FirstFT: Netanyahu accuses Hamas of backtracking

Good morning and welcome back. Today we are covering:

• Israel-Hamas agreement delays

• US stocks’ best day since Trump’s election victory

• Citi’s £1bn refit of its London headquarters

• And the impact of New York’s congestion charge

Israel’s Prime Minister Benjamin Netanyahu has accused Hamas of reneging on parts of the Gaza ceasefire and hostage release deal and delayed a cabinet meeting intended to endorse the agreement.

US President Joe Biden, president-elect Donald Trump and the prime minister of Qatar last night announced that Hamas and Israel had agreed a multi-phase deal that would halt the 15-month war in Gaza and free the 98 hostages still in captivity. The ceasefire is supposed to come into effect and the first hostages released on Sunday.

But Netanyahu’s government, which relies on the support of two far-right parties bitterly opposed to any deal, this morning said the deal’s final details had not been resolved and added that Hamas had backtracked by seeking to dictate which Palestinian prisoners should be released in exchange for Israeli hostages.

Finance minister Bezalel Smotrich, who is a member of the far-right Religious Zionist party, branded the deal “bad and dangerous” last night and a member of his party this morning said that “in all likelihood” the party would resign from Netanyahu’s government if it agreed to the deal.

The agreement is the closest Israel and Hamas have come so far to agreeing an end to the brutal war which has become the deadliest chapter in the decades-long history of the Israeli-Palestinian conflict. James Shotter in Jerusalem has the latest.

Here’s what else we’ll be watching today:

• Earnings: Bank of America and Morgan Stanley are the latest major US banks to report earnings, following yesterday’s bumper profits from JPMorgan and Goldman Sachs, among others.

• Economic data: The US commerce department’s Census Bureau is due to publish retail sales figures for December, and the labour department will release initial jobless claims for the week ending January 11.

• Congress: Hedge fund manager and Donald Trump’s nominee as Treasury secretary, Scott Bessent, will appear before senators for the latest confirmation hearing.

• Starmer in Kyiv: Sir Keir Starmer will sign a symbolic “100-year partnership” treaty with Ukraine in his first visit to the country as UK prime minister.

Five more top stories

1. Joe Biden has warned that an “oligarchy is taking shape in America” that risks damaging democracy. Five days before he hands power to Donald Trump, the outgoing US president blasted an emerging “tech industrial complex” in a veiled attack on his successor’s allies, including Elon Musk. Here’s more from Biden’s farewell address.

2. Blue Origin’s New Glenn rocket has reached orbit on its maiden flight, five years later than originally planned and roughly an hour into its launch window. But it boosts the ambitions of Jeff Bezos to challenge the hold of Elon Musk’s SpaceX on the satellite launch market and paves the way for a new era in space flight.

3. Trump could use the approval of cross-border deals to press foreign governments into aligning with US policy priorities, dealmakers and investors have warned. One European banker said: “The people in this administration have no compunction about using every lever at their disposal to achieve their aims.”

• Nippon Steel: An anti-Japan tirade by the head of US steelmaker Cleveland-Cliffs is symptomatic of the abrasive environment brewing in the Trump era, writes Leo Lewis.

4. Pension funds are dipping their toes into buying bitcoin, in a sign that even typically staid corners of finance are finding it hard to ignore the potential outsized returns from cryptocurrencies. Pension schemes for the states of Wisconsin and Michigan are among the main holders of US stock market funds devoted to crypto. Here are more examples of institutions diving into digital currencies.

5. Citigroup is on course to spend more than £1bn on the overhaul of its 25-year-old Canary Wharf tower in east London. When the bank launched the refit in 2022, it was reported the cost would be more than £100mn. But people close to the project said that figure had never been realistic.

The Big Read

Foreign oil has underpinned China’s economic rise, as the country built the world’s largest car industry from scratch, new railways and air travel networks, and thousands of skyscrapers. But China’s thirst for crude may be reaching a peak sooner than expected, a development that has sent shockwaves through the oil market.

We’re also reading . . . 

• LA fires: The damage — and the insurance crunch that will follow — would not have been as enormous were it not for a series of misguided state policies.

• 🎧M&A: The head of Lex discusses the outlook for dealmaking over the next four years and the surprising similarities it could share with Biden’s administration.

• Scholz’s legacy: We trace the German chancellor’s shortlived government in charts, including its failure to stop the nation’s economic decline.

Chart of the day

New Yorkers are cruising much faster along Manhattan’s bridges and through its tunnels since the city implemented its long-debated congestion pricing plan this month, according to newly available traffic data. In one route from New Jersey, morning rush-hour speed has almost doubled.

Take a break from the news . . . 

Asia’s rapidly growing economies have bolstered, and at times rescued, the global art market since the financial crisis of 2008. In recent years, though, demand from China has waned. But, fortunately for the art market, countries such as South Korea, Taiwan and Japan are among those now on the commercial cultural map. Here’s what Asia’s top art collectors are buying as collectors prepare to gather in Singapore for Art SG.

Source: Economy - ft.com