Today’s top stories
US conspiracy site InfoWars founder Alex Jones files for bankruptcy, having been ordered to pay $1.5bn in damages to Sandy Hook school shooting victims
The head of IMF warns Asia’s leaders and central bankers to brace for “exceptional” uncertainty as the impact of China’s zero-Covid policy and Russia’s invasion of Ukraine hit the region
ANC leaders meet to discuss President Cyril Ramaphosa’s fate after a damning parliamentary report into a scandal over the theft of bundles of cash from his private game farm
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Good evening.
The US jobs markets remained robust, despite the Federal Reserve’s tightening campaign. Today’s US non-farm job payrolls reported 263,000 jobs were added to the economy last month, compared with an expected 200,000. This comes as a top Fed official warned that US unemployment rate could hit 5 per cent next year.
Added jobs are a blow to the markets. Wall Street stocks fell sharply today and the dollar strengthened. Historically elevated vacancies added pressure on the Fed Reserve to pull the reins on the decades-high inflation. Earlier this week Fed Reserve chair Jay Powell said the demand for higher benchmark policy rates comes as the US central bank has seen “only tentative signs of moderation of labour demand”.
This means that job losses are on the horizon. Indeed Loretta Mester, president of the Cleveland Fed, told the FT reduced supply of workers would probably mean the central bank has to do more to bring down demand for new hires.
Workers are also affected by the Big Tech blues. Twitter has laid off thousands of workers since Elon Musk completed his purchase of the social media platform in October. This week Amazon identified cuts in its low-margin and costly hardware divisions — the makers of Alexa, Kindle and the Halo health tracking device. Silicon Valley law firm Cooley, which counts Facebook owner Meta, Apple and Netflix among its clients, announced it is axing over 100 lawyers and other staff, following a dramatic slowdown in its technology practise. “What isn’t clear to any of us is if it ends there,” said one Kindle employee.
Across the Atlantic, yesterday’s eurozone labour market data defied the gloom though. The single market unemployment rate is at a record low at 6.5 per cent. A 142,000 reduction in jobless people was the largest drop since November 2021, but economists predict labour demand will wane.
Meanwhile, the UK is braced for a wave of industrial unrest over the winter as the country faces a steep recession. Ambulance workers are the latest public sector employees to vote to go on strike, prompting prime minister Rishi Sunak to create a dedicated unit to respond to the threatened “winter of discontent”. The days lost to labour disputes are currently incomparable to the strikes of 1978-9. Will that change when nurses, rail, postal and ambulance workers all strike?
Need to know: UK and Europe economy
Europe is on the breadline. Inflation has overwhelmed food banks as a surge in demand has led organisations to turn people away.
Ukraine has restored some power, but Kyiv’s allies are concerned by the struggle to increase ammunition production. Nations have been slow to sign contracts needed to boost supply.
Brexit means Brexit. EU officials will raise concerns that the UK’s freeport scheme will violate the post-Brexit Trade and Cooperation Agreement at a meeting this week. Post-Brexit labour shortages also remain unsolved.
UK house prices fell at the fastest pace since the financial crisis, excluding the spring lockdown of 2020. Nationwide said a drop of 1.4 per cent in November came as rising borrowing costs weighed on sentiment. Perhaps coming to the rescue, John Lewis is to link with Abrdn to build homes for rent.
Need to know: Global economy
Senior Dutch minister Micky Adriaansens defended trade links with China and said the Netherland’s would not undermine its relationship with Beijing in the face of US pressure over high-tech exports.
Emerging market equities and bonds rallied powerfully, after optimistic prospects that China would relax its Covid restrictions and a dollar sell-off relieved pressure on developing countries.
With the private sector’s support, New Delhi has increased infrastructure spending in neighbouring countries. Our Big Read delves in to India’s plan to take on China as south Asia’s favourite lender.
Need to know: business
Blackstone has limited withdrawals from its $125bn real estate investment fund as concerns about the long-term health of the commercial property market have led to a surge in redemption requests.
HSBC chief executive Noel Quinn denied that Beijing is driving Ping An’s campaign to spin off its Asian business. Quinn said the Chinese insurer’s demands are not backed by other large shareholders or its customers.
Credit Suisse chair Axel Lehmann said clients have begun to return to the bank after withdrawing tens of billions of dollars of assets following a “social media storm” which started in October.
Latest in the Twitter–Apple spat, Elon Musk has said he spoke to Apple CEO Tim Cook and “resolved the misunderstanding” about his claim that Twitter may be removed from the App Store. Meanwhile the US and EU have turned up the heat on Musk over Twitter.
Ford announced it would invest £150mn in its Halewood plant in Liverpool, with hopes to boost the UK’s flailing car industry by expanding the production of electric vehicle parts.
Profits at UK investment bank Peel Hunt were almost entirely wiped out after a plunge in company flotations and other equity-raising activity in 2022.
Science round-up
Chinese vice-premier Sun Chunlan said Covid has entered a “new stage” and the state-media have downplayed its risks, not long after officials in the southern manufacturing hub of Guangzhou eased restrictions.
Lecanemab, a drug being developed by Japan’s Eisai and Biogen, was hailed as a breakthrough in the treatment of Alzheimer’s. However Eisai could not rule out the possibility that the drug contributed to brain bleeds in two patients who died during clinical trials.
New AI developments raise ethical questions about their ability to deceive, writes science commentator Anjana Ahuja.
The blood clot drug Apixaban, widely prescribed to Covid-19 patients after discharge from hospital, has been found to be ineffective.
The team behind Apple’s Face ID is developing tiny robots to deliver drugs into the brain to target hard to treat diseases such as Parkinson’s, Huntington’s, Alzheimer’s and strokes in the long run.
“Twenty per cent of our future health is prewritten — but the other 80 per cent is within our control.” HTSI magazine explores the latest watchword of the wellness industry.
Some good news
On a brighter note, Christmas lights won’t put you out of pocket this festive season. It would cost just 18p to turn on a string of 100 LED lights for six hours a day for a month, Money Saving Expert Martin Lewis told Good Morning Britain.
Something for the weekend
The FT Weekend interactive crossword will be published here on Saturday, but in the meantime why not have a go with today’s cryptic crossword.
Get the latest worldwide picture with our vaccine tracker
Source: Economy - ft.com
