Aurelia Butler

Today’s top storiesA 21-year-old Air Guardsman suspected of leaking highly classified US intelligence documents has been charged.France’s constitutional council has cleared President Emmanuel Macron’s unpopular pension reforms.The European parliament is preparing tough new measures over the use of artificial intelligenceFor up-to-the-minute news updates, visit our live blog.Good evening. With Darren on holiday, I am with you for Disrupted Times today.It’s been a big day in banking. Since the collapse of Silicon Valley Bank last month, there seems to be little consensus over whether the ensuing financial turmoil in the US and across Europe is waning or a taste of more to come. This morning, some of the biggest US banks reported their first-quarter profits, and JPMorgan, Citigroup and Wells Fargo have confounded pessimistic expectations.JPMorgan Chase’s net income rose 52 per cent year-on-year in the first quarter, gaining $37bn in deposits following SVB’s collapse. The bank exceeded analysts’ estimates for quarterly net income, according to consensus data compiled by Bloomberg.Strong consumer spending and corporate activity drove profits for Citigroup in the first three months of this year. Net income rose to $4.6bn, or $2.19 per share. That was a marked improvement on analysts’ forecasts. Citi’s profits were bolstered by planned sales including an India-based consumer banking business.At Wells Fargo, sales increased 17.8 per cent to $30.7bn during the first three months of 2023. However, deposits have fallen slightly and are down 7 per cent from last year.BlackRock, the world’s biggest money manager, also reported earnings today — but it didn’t fare as well. The group’s quarterly net income fell by nearly a fifth. Net income fell 19 per cent year-on-year to $1.1bn as it struggled to weather the industry fallout following last month’s banking turmoil.Need to know: UK and Europe economyEuropean stocks responded optimistically to US economic data, as fears of further Federal Reserve interest rate hikes receded.However, the UK outlook is less optimistic, with Britain’s goods exports having fallen behind all other G7 countries. Quarterly figures released from the Office for National Statistics last month demonstrated that in the final quarter of 2022, UK export volumes were more than 9 per cent below the 2019 pre-pandemic average.

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While other countries’ employment rates have recovered from pandemic-induced recessions, the UK looks slow to catch up, says John Burn-Murdoch, the FT’s chief data reporter.Economics editor Chris Giles writes that while the UK sees signs of the slowdown that the Bank of England believes is necessary to reduce inflation, the data may not be sufficient to convince the central bank to pause interest rate rises.Need to know: Global economyA fall in US producer prices have fuelled investor hopes that the Federal Reserve might wrap up its rate hiking campaign. However, top Fed official Christopher Waller says there’s still more work to do to bring inflation under control.Ghana is in the spotlight in our latest story in our series on distressed countries. The conditions the IMF has imposed on the African nation since it defaulted on its debts last December have opened “a can of worms”, said Thys Louw, emerging market debt portfolio manager at investment company Ninety One.In Singapore, the world’s biggest banks have been asked to avoid discussing the origins of wealth flowing into the Asian financial hub as the billions coming into the city-state from rich Chinese has become a politically sensitive issue. Need to know: businessLondon-listed gambling group 888 has reinstated Middle Eastern client accounts after failures to correctly follow anti-money laundering processes earlier this year.A production issue is set to damage Boeing’s ability to deliver 737 Max jets, potentially exacerbating global aircraft shortages that are already causing headaches for customers.

Production problems are set to delay Boeing’s ability to deliver 737 Max jets © Reuters

Glencore has held on tightly to its coal business while other mining companies including Rio Tinto and BHP have moved on. But now it wants to spin off coal, as part of its $23bn hostile takeover bid for Teck Resources.American business magnate Larry Ellison’s stealth takeover of Oracle demonstrates that old tactics by “tech dinosaurs” still work, writes the FT’s west coast editor Richard Waters.Corporate filings reveal that billionaire brothers Mohsin and Zuber Issa, who own one of the world’s biggest petrol station businesses EG, bought the £6.8bn supermarket chain Asda for just £200mn.Science round-upHealth authorities in Ghana have granted a new malaria vaccine developed at Oxford university’s Jenner Institute its first regulatory approval. Director Adrian Hill said the approval marked the “culmination of 30 years of malaria vaccine research”.

Malaria is one of biggest causes of child death globally, with countries in Africa disproportionately affected © Jerome Delay/AP

A UK review argues that moving clinical trials from overwhelmed hospitals to “pop-up” locations could boost the number of trials. This is in response to a nearly 41 per cent fall in industry clinical trials since 2017.British scientists have released research mapping the genetic evolution of lung cancer cells, which allows them to predict the cells’ future behaviour.A detection tool has been developed by academic publishers to spot academic essays written by “paper mills” as the industry attempts to clamp down on fake research studies. In the final episode of Tech Tonic’s series on quantum technology, the FT’s Madhumita Murgia speaks to Nobel Prize winner Anton Zeilinger about the potential for teleportation.Intel, once the global leader in semiconductor manufacturing, is fighting to prove it can become the chip champion the US needs as it aims to win financial backing from the Biden administration.Some good newsIn some good news for the weekend, a cross-sectional study of 1,123 participants has found a highly accurate technique for identifying Parkinson’s disease, according to research published in The Lancet Neurology journal. The technique detects at-risk patients and may be an early indicator of the patient developing the disease at a later date. More

U.S. short-term interest rate futures reflect the view that a rate hike in May is about four times as likely as no move, slightly firmer than the chance seen before the Commerce Department report. The current target range is 4.75%-5.00%.(This story has been corrected to say retail sales drop was more than expected, in paragraph 1) More

(Reuters) -Citigroup Inc’s first-quarter profit beat Wall Street expectations on Friday as it earned more from borrowers paying higher interest on loans.While its net interest income rose 23% to $13.3 billion, Citi also set aside $241 million to cover potential loan losses, from $138 million a year earlier. It joined other banking giants in preparing for a potential recession and the likelihood of consumers and businesses falling behind on payments later this year.Citi earned $1.86 per share in the first quarter, beating analysts’ average estimate of $1.67, according to Refinitiv data. Net income rose 7% to $4.6 billion, or $2.19 per share, in the three months to March 31 from $4.3 billion, or $2.02 per share, a year earlier.Thomas Hayes, chairman and managing member at Great Hill Capital, said Citi “reported the weakest growth of the three (banks reporting on Friday) – but still better than expected – and managed to buy back $1B of stock. Today’s bank earnings put dagger in the heart of the bears.”Citi also benefited from selling assets, with revenue from its legacy franchises unit climbing 48% to $2.9 billion. The bank on March 1 announced the sale of its Indian consumer business to Axis. At the time, the bank said the transaction would result in a benefit of $1.4 billion. The banking sector was jolted by the collapse of Silicon Valley Bank and Signature Bank (OTC:SBNY) last month, which wiped out billions of dollars in market value. In Europe, Credit Suisse was rescued by rival UBS Group AG (SIX:UBSG) in a government-backed takeover.The lender’s deposit growth was flat at $1.33 trillion from a quarter as well as a year ago as investors moved their cash into money market funds to chase greater yields. Its loans also fell marginally to $652 billion. Analysts expect an economic slowdown to curb demand for loans and depress net interest margins (NIM) across the industry in the coming quarters.”The banking crisis may take attention from the efforts for a short period of time, but in the long run, this crisis will show where Citigroup (NYSE:C)’s strengths lie by acting as a major stress test and will assist in simplifying operations in the long run,” said Mona Dajani, a partner at New York-based law firm Shearman & Sterling LLP.Citi’s investment banking revenue sank 25% from $774 million a year ago, weighed down by the most sluggish market for deals in more than a decade. It slipped four rungs to the ninth position in 2023 in the list of financial advisors based on deal value, according to data from Dealogic. More

“The CFTC and the Bank reaffirm the primacy of the UK and US home authorities in their respective jurisdictions,” the BoE said in a statement.The BoE said that it would recognise CFTC assessments of U.S.-based CCPs which operate in Britain.”This assessment enables the Bank to place reliance on the CFTC’s supervision and oversight of incoming CCPs based in the US,” it said. More

The Paris Club said the Japanese and Indian finance ministers along with its president and representatives of Sri Lanka set up a creditor committee on Thursday on the sidelines of the spring meetings of the International Monetary Fund and World Bank in Washington.Creditor committees lead talks about the terms for a future debt relief deal.”The Paris Club intends to keep the momentum and start the restructuring negotiations in coordination with all relevant stakeholders, to ensure fair burden sharing, transparency and comparability of treatment,” it said in a statement.It added that all public sector creditors were welcome to participate in the process.Sri Lanka last month secured a $2.9 billion IMF programme to tackle its suffocating debt burden and its worst economic crisis in more than seven decades. More

WASHINGTON (Reuters) -Bank of Japan Assistant Governor Tokiko Shimizu said on Friday there had been “extremely high” uncertainty regarding Japan’s economy, as slowing global growth and recent financial market stress cloud its outlook.”The BOJ deems it necessary to conduct monetary easing and support the economy, and provide a favourable environment for firms to raise wages,” Shimizu told a seminar hosted in Washington by the Peterson Institute for International Economics.Rapid interest rate hikes by U.S. and European central banks could eventually depress global growth, which was among risks discussed at this week’s International Monetary Fund (IMF) meetings, Shimizu said.”More recently, financial market stress is drawing attention,” she said. “Taking these risks into account, it’s necessary to pay due attention to developments in the financial sector” and the impact on Japan’s economy and prices.The remarks came after the IMF on Tuesday trimmed its 2023 global growth outlook and warned that a severe flare-up of financial system turmoil could slash output to near recessionary levels.Reflecting rising raw material costs and a tightening job market, more Japanese firms are raising prices and wages in a sign of change in the public’s long-held deflationary mindset, Shimizu said.Many big firms have accepted union demands for pay increases with some smaller companies following suit, she said.Despite such positive signs, broader wage hikes are needed for Japan to hit the BOJ’s 2% inflation target in a stable, sustainable manner, Shimizu said.Shimizu is among BOJ officials accompanying new central bank governor Kazuo Ueda on a visit to Washington for this week’s IMF and G20 finance leaders’ meetings.Japan’s economy has made a delayed recovery from the scars of the COVID-19 crisis, with an end to pandemic-induced curbs propping up consumption.But global recession fears cloud the outlook for the export-reliant economy, a risk that may keep the BOJ from phasing out its massive stimulus.Markets are focusing on the BOJ’s first policy meeting to be chaired by Ueda, on April 27-28, when the board will produce fresh quarterly growth and inflation forecasts extending through fiscal 2025. More

(Reuters) -UnitedHealth Group Inc beat Wall Street targets for quarterly profit and raised its annual forecast on Friday, as the healthcare giant banks on “market-leading” membership growth in its federal government-backed health insurance plans. UnitedHealth (NYSE:UNH) is among the largest players in the Medicare Advantage market, where private insurers offer an alternative to the original Medicare – the federal government’s health insurance plan for people aged 65 and older or those with certain disabilities. The industry bellwether’s strong Medicare outlook offers some relief at a time when health insurers are bracing to lose some members in their Medicaid plans – which cover healthcare costs for people with low incomes – as states remove pandemic-era guidelines to keep members continuously enrolled. Medicare and Medicaid memberships make up a third of the company’s health insurance business. It added 655,000 Medicare Advantage members and 570,000 Medicaid members in the quarter.Shares of the Dow component were up nearly 1% at $530 before the bell. Meanwhile, a slow recovery in non-urgent procedures helped lower medical costs at its insurance unit, driving the company’s first-quarter profit above expectations. “We expected few surprises from a medical cost perspective in the quarter, given performance by the industry in the fourth quarter,” said RBC Capital Markets analyst Ben Hendrix.The company’s medical cost ratio – the percentage of payout on claims compared with premiums – came in at 82.2%. Analysts had estimated 82.54%, according to Refinitiv IBES data.UnitedHealth raised its adjusted 2023 profit forecast to between $24.50 and $25 per share, compared with its earlier estimate of $24.40 to $24.90 and market expectations of $24.94. Excluding items, it reported a quarterly profit of $6.26 per share, beating estimates of $6.13. More