FirstFT: Companies bring forward financing plans to avoid US election uncertainty

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Good morning. We start the week with news that companies are rushing to meet their financing needs before the US election, in a bid to get ahead of potential market volatility in the final stages of the race.

According to LSEG data, corporate borrowers have issued $606bn worth of dollar bonds so far this year — that’s up by two-fifths compared with the same period in 2023 and the highest total since at least 1990. Bankers and investors said companies were being motivated to borrow by the lowest spreads in years, referring to the difference between US corporate debt yields and those of equivalent government bonds. However, they added that the prospect of a close election had pushed companies to bring forward their plans, rather than risk running into potentially more expensive markets later in the year.

More details on what the companies, from Morgan Stanley to Ford, are up to.

And here’s what else we’re keeping tabs on today:

• Economic data: S&P Global publishes its manufacturing purchasing managers’ indices for the US, Russia, Canada and Greece.

• Israel: Demonstrations against Benjamin Netanyahu are set to continue until Wednesday after tens of thousands of Israelis rallied in Jerusalem last night in the biggest protest against the prime minister’s rightwing government since the start of the war against Hamas.

• Easter Monday: Financial markets are closed in the UK, France, Germany and Italy.

Five more top stories

1. Exclusive: Regulators in two US states are pushing insurers to cut exposure to 777 Partners, according to an official memo seen by the Financial Times. Their demands are the latest fallout from a dealmaking spree in which the Miami investment firm bought sports teams around the world, and comes as it is bidding for English Premier League club Everton. Here’s why the states believe their move would protect retirees, widows and orphans relying on annuities and other insurance products.

2. The US government is said to be arranging a summit between President Joe Biden and his Japanese and South Korean counterparts, Fumio Kishida and Yoon Suk Yeol for July. Japanese media outlets reported that this would take place alongside a Nato summit in Washington, and would include discussions about defence and North Korea’s nuclear threat.

3. Russian disinformation to undermine support for Ukraine in Europe has grown significantly in scale, skill and stealth, one of Germany’s most senior diplomats has warned. “It is absolutely a threat we have to take seriously,” Ralf Beste, head of the department for culture and communication at Germany’s Federal Foreign Office, told the FT. Here’s why Moscow’s campaigns have become harder to combat.

• EU defence: The chief of Germany’s largest military contractor Rheinmetall told the FT that European countries should ditch their preference for national champions and build bigger, more specialised defence groups to compete with US rivals.

4. Recep Tayyip Erdoğan’s ruling party suffered a resounding defeat in Turkey’s local polls, leaving the president facing his most severe electoral setback since his rise to power two decades ago. Ekrem İmamoğlu’s strong performance for the opposition Republican People’s party (CHP) in Istanbul marked a particularly painful blow for the president, who had campaigned vigorously for the AKP’s mayoral candidate in the hope of vanquishing his most credible rival. Here’s more on what the outcome means for the strongman and his party.

5. Lawmakers in US state capitals are seeking to stifle development of “lab-grown” meat. Republicans in at least seven states have introduced legislation since the beginning of the year to ban sales or distribution of lab-grown tuna, pork and other animal proteins, which are cultivated from animal cells. Find out why.

For more on US politics in the lead-up to the election, sign up for Steff Chávez’s US Election Countdown newsletter, out every Tuesday and Thursday.

Violence in Argentina

The birthplace of well-known figures from revolutionary Che Guevara to football superstar Lionel Messi, Rosario has more recently become known for a different reason: it has transformed into a drug trafficking hub as Latin American groups step up exports of cocaine to meet growing demand in Europe and the US. Don’t miss Ciara Nugent’s shocking report from the rgentinan city.

We’re also reading . . . 

• Learning from Kim Kardashian: The reality star’s run-in with regulators as a “finfluencer” provides lessons on an age-old problem in finance.

• China’s ‘hypocrisy’: Rana Foroohar is not impressed by China’s complaints about US protectionism.

• AI hype: DeepMind co-founder Sir Demis Hassabis tells the FT that money flooding into artificial intelligence has resulted in some crypto-like hype and “grifting” that clouds the field’s “phenomenal” scientific progress.

• Labour’s challenge: It will be hard for the UK economy to get any worse, but the bad news facing the next government is that it will also be hard to make it much better, writes Martin Wolf.

• The race to develop the next generation of weight-loss drugs: Pills are the holy grail of convenience, making them a key development, as Ian Johnston in Copenhagen and Oliver Barnes in New York, report.

Chart of the day

Employment figures are closely watched by central bankers around the world as they try to work out when to cut interest rates. But there is one big problem: the data might be dodgy.

Economists are increasingly questioning whether official reports can be relied upon for an accurate read of the labour market, with constant revisions to crucial US jobs data just one of the many headaches facing policymakers.

Take a break from the news

How Harry Potter is still enticing visitors to the UK — even to places with no obvious connections to the books or films!

Contributions from Benjamin Wilhelm, Tee Zhuo and Sarah Ebner