Aurelia Butler

Emmanuel Macron is to be re-elected for a second term as French president after defeating his far-right rival Marine Le Pen in the second round of voting on Sunday, according to projections by polling agencies based on early returns. Le Pen conceded after the projections on Sunday showed Macron winning about 58 per cent of the vote, against her 42 per cent. However, she vowed to fight on with her Rassemblement National party in elections for the National Assembly in June. Once the results are confirmed, Macron will be the first French president to be re-elected in 20 years. Victory for Macron, first elected in 2017, will mean continuity in economic and foreign policy, and comes as a relief to investors and to France’s EU and Nato allies in the midst of the Russian invasion of Ukraine. A win for Le Pen would have been a geopolitical earthquake akin to Brexit or the election of Donald Trump.“I am delighted to be able continue our excellent co-operation,” EU commission president Ursula von der Leyen tweeted on Sunday after congratulating Macron. But the far-right has not performed as strongly as this in France since the second world war and Macron will preside over a deeply divided nation.Happy Monday. I hope you have a great start to your week. Here’s the rest of the day’s news — SophiaThe latest from the war in UkraineVolodymyr Zelensky anger: The Ukrainian president lashed out at the Kremlin over a Russian missile attack that killed civilians in Odesa on Saturday, a day before he met with top US diplomat Antony Blinken.Turkey blockade: Ankara has banned Russian armed forces’ air route to Syria, in a bid to motivate Vladimir Putin to renew peace talks.Foreign military aid: The US is boosting the range of heavy weaponry it will supply to Ukraine, including parts to get 20 warplanes back in the air.Boris Johnson warning: The British prime minister became the first western leader to concede that Putin could win the war, and proposed sending tanks to Poland.Farewell drinks: Anheuser-Busch InBev, the brewer of Budweiser and Stella Artois, is in discussions to sell its stake in a Russian joint venture to its Turkish partner.Sinking of the Moskva: Sailors’ families are seeking answers over the sinking of Russia’s flagship while Moscow seeks to control the narrative.Oleg Tinkov censures invasion: The banking tycoon is the highest-profile Russian entrepreneur to criticise Putin’s “crazy war”.Video: The FT examines why it took Russia’s invasion of Ukraine to highlight London’s role in the recycling of Russian money.Five more stories in the news1. Putin has abandoned a peace deal in favour of a land-grab strategy The Russian president, who said he sees no prospects for a settlement, has lost interest in diplomatic efforts to end his war with Ukraine and instead appears set on seizing as much Ukrainian territory as possible.2. Shanghai tightens lockdown with harsh measures Local authorities are fencing off apartment building entrances to further restrict movement in the city. Meanwhile, China’s army of censors are struggling to remove viral videos from spreading online that depict the growing frustration in the financial hub.3. Blackstone takes aim at publicly listed real estate vehicles The buyout group has spent billions of dollars taking four real estate investment trusts, or “Reits”, private since the start of the pandemic. This leaves investors with fewer ways to cash out, but can be attractive for those interested in smoothing out market bumps.4. Cambridge Innovation Capital’s funding brings it to $1bn assets CIC has raised £225mn to invest in early stage start-ups operating in areas from cell therapies to quantum computing. The VC firm, which has a special contract with Cambridge university, likens innovation and entrepreneurship in the university city to Silicon Valley.5. Rising US rates and China’s slowdown hit renminbi China’s renminbi is heading for its biggest weekly drop since before the pandemic as the country’s deteriorating economic outlook and rising returns on US debt undermine the draw of Chinese securities. The pound dropped to its weakest level since late 2020 today after the release of weak retail sales data.The day aheadQ1 results Tesla and Coca-Cola will both release their first-quarter results today, as well as Activision Blizzard, Deutsche Börse, Hyundai, Philips Electronics, and others.Anzac Day Australia commemorates the ill-fated landing of the Australia and New Zealand Army Corps on the beaches of Gallipoli in Turkey on April 25 1915.Register here to attend the FT’s first Crypto and Digital Assets Summit on April 26-27. Be sure to check out the full line-up of events, including remarks from Changpeng Zhao, founder and chief executive of Binance.What else we’re readingAre airlines ready for a summer travel boom? The aviation industry is struggling to expand operations after two years of Covid disruptions, cost-cutting and redundancies. After 24 months of crisis management, passengers are suddenly coming back so quickly that the industry does not know what to do with them.Elon Musk could help Twitter, but not in the way he thinks The world’s richest man seems largely uninterested in the area in which he could most help Twitter: rethinking its business model. Instead of focusing on scrapping the platform’s moderation, Musk could focus on figuring out better governance for social media companies, writes John Thornhill.The crypto industry’s pricey Super Bowl ads fell flat LeBron James and Larry David were among the star-studded cast of crypto commercials run during the American football game two months ago. Since then, trading has turned sluggish as factors like rising interest rates and the war in Ukraine have dampened investor spirit.The big cancellation is spreading beyond Netflix The growing subscription economy is finally starting to trend downward, as rising inflation causes consumers to rethink discretionary spending. Streaming services such as Netflix are the canary in the coal mine — the gloomy climate is also casting a shadow over other sectors like clothing and restaurants.

What you should know if you’re fiddling your expenses A piece of corporate wisdom states that if a company wants to fire someone, the easiest way to do it is to go through their expenses. Over-exaggerating business expenses is so widespread that many don’t even consider it to be fraud. New digital systems ushered in by the pandemic might make it harder to fudge the numbers, though.House & Home“Nobody is remotely real around the royals”, says former New Yorker editor Tina Brown as she discusses her new book about the British monarchy, her role as a “transatlanticker” and knowing everyone from Obama to Malala.

‘The Palace Papers’ by Tina Brown is a sharp-nibbed observation of a generation of tumult for the House of Windsor, bookended by the deaths of Diana, Princess of Wales, and Prince Philip © Timothy O’Connell More

LONDON (Reuters) – European markets will breath a collective sigh of relief on Monday as pro-EU centrist Emmanuel Macron looked set to win a second term as France’s president, beating rival far-right candidate Marine Le Pen.First projections after Sunday’s run-off election showed Macron securing around 57-58% of the vote. Such estimates are normally accurate but may be fine-tuned as official results come in from around the country.While a Macron win was the likeliest outcome, markets had fretted about his relatively small poll lead over Le Pen, who favours nationalising key industries, slashing taxes and cutting French contributions to the EU budget.The euro should now get a boost when it starts trading in Asia in a few hours’ time, while French and European markets were expected to open higher, at least initially, on Monday.”What we have learned form the last couple of years is that the polls are good but not completely reliable,” said Marchel Alexandrovich, European economist at Saltmarsh Economics in London. “So, we are likely to get a relief rally, there would have been such a big upset if Le Pen had won.”The yield premium demanded by investors to hold French 10-year bonds versus European benchmark Germany — a key barometer of relative risks — fell to a three-week lows around 42 basis points on Friday as investors anticipated a Macron win. French stocks closed almost 2% lower and the Euro Stoxx 600 closed down 1.8% as rate-hike jitters weighed on global stocks. While Le Pen had toned down her anti-euro rhetoric, there was no shortage of initiatives that would have put Paris on a collision course with EU partners.So relief at Sunday’s election result should be felt across the euro area too.Kasper Hense, a senior portfolio manager at BlueBay Asset Management, said he expected the French/German yield gap to move 10 bps tighter, noting BlueBay had gone short Italian debt on a view that markets were “a bit complacent” ahead of the election.”While over the medium term there will be some pressure on peripheral bonds, the immediate market reaction will be one of relief,” he said. Macron will become the first French head of state in two decades to win a second term, promising continuity in the bloc’s second biggest economy at a time of heightened uncertainty unleashed by the war in Ukraine, surging inflation and the prospect of the rapid withdrawal of central bank stimulus.Shares of French banks such as BNP Paribas (OTC:BNPQY), Societe Generale (OTC:SCGLY) and Crédit Agricole, which rallied after Macron’s strong showing during Wednesday’s key TV election debate, could also see more gains on Monday.Other analysts such as Seema Shah, chief strategist at Principle Global Investors, said that after the knee-jerk reaction attention was quickly likely to return to central banks’ response to soaring inflation.European Central Bank officials are keen to end bond purchases at the earliest opportunity and raise interest rates as soon as July, sources familiar with ECB thinking told Reuters.Focus will also shift to France’s June parliamentary elections. To implement reforms, the new president will need to secure a parliamentary majority. That election will have a significant bearing on the future policy, so investors with specific French exposure may bide time before taking a view.”Is the outcome of this election clear enough to anticipate that the June parliamentary elections will give the President a majority that will allow him to implement his pro-business and pro-European policies desired by the markets?” said Frederic Leroux, a member of Carmignac’s investment team.”It seems dangerous at this stage to take it for granted.” More

Hello and welcome to the working week,Did you miss me? Thank you to those who emailed — to [email protected] — while I was away. And for those who did not, you are welcome to drop me a line now about events you think should (or should not) be mentioned in this newsletter. Depressingly, the Ukraine conflict is a certainty for news events this week but activity will be largely off diary — except for events such as the UK reopening its embassy in Kyiv — for the next seven days. Somewhat ironically there is a long list of other war anniversaries this week — from Monday’s Anzac Day to Saturday’s commemoration in Vietnam of Liberation Day. A reminder that peace has been an unobtainable dream for this world in modern times.At the same time, we are in a sort of minor holiday season. Easter, orthodox or otherwise, has been and gone and this coming Sunday heralds the various May Day celebrations around the world.At the moment this newsletter was sent, the result of the final round of the French presidential election was imminent. Next comes the analysis — a reason to keep connected to the FT’s coverage.Before getting on to the economic and corporate news, here is a plug for an FT event this week. The Future Cities Americas forum, running from Tuesday to Thursday, will bring together government leaders, corporates, innovators, academics, investors and financial services experts to establish a common vision for the sustainable, equitable, and safe cities of tomorrow. And as a newsletter subscriber, you can register free here. Economic dataIt’s a fairly full week for economic news with inflation figures for France, Germany and the eurozone countries as well as first-quarter GDP estimates for the eurozone, the US, Korea, France, Germany Italy and Spain plus an interest rate decision by the Bank of Japan.The conflict in Ukraine is having an immediate and longer term impact on the global economy, as the IMF highlighted last week when it cut growth forecasts for numerous countries.The new world (dis)order was described by Pierre-Olivier Gourinchas, IMF chief economist, in an interview with the Financial Times. “If we become a world of many different blocs, we will have to undo a lot of the integrated economies that we’ve built and supply chains that we’ve built . . . and build something else that is more narrow [and] smaller in scope,” he said. “There will be adjustment costs [and] there will be efficiency losses and that could lead to an increase in unit costs because things are not done as efficiently as before.”CompaniesIt will be a week for the geeks in terms of corporate earnings this week. Big Tech has had a good pandemic. The question now is whether Meta, Alphabet, Amazon.com, Microsoft or Spotify can maintain their strong growth rates. After last week’s Netflix shock drop in subscribers, investors are no doubt nervous, although as has been pointed out there is a difference between a company purely focused on streaming TV and film shows and other tech businesses.Golden child Apple may now fancy itself as a Hollywood player after taking top prize at the Oscars, but its investors are worrying about its ability to deliver new tech kit given the wave of lockdowns at several of its Chinese manufacturing hubs. That next iPhone model won’t make itself, you know. Analysts at Morgan Stanley believe Wall Street’s consensus forecasts for the June quarter of $86.7bn (a rise of 6 per cent year on year) “seems high” given chief executive Tim Cook’s typical caution when it comes to guidance.Key economic and company reportsHere is a more complete list of what to expect in terms of company reports and economic data this week.MondayGermany, Ifo business confidence surveyUK, Bank of England’s asset purchase facility quarterly report, Rightmove April house price survey plus CBI quarterly industrial trends reportResults: Activision Blizzard Q1, Deutsche Börse Q1, Hyundai Motor Company Q1, Philips Electronics Q1, Roche Q1, Südzucker H1, Vivendi Q1TuesdaySouth Korea Q1 GDP dataTaylor Wimpey trading update and AGMUK, March tax receipts data showing the state of the public financesUS, consumer confidence figures and March durable goods ordersResults: 3M Q1, Alphabet Q1, Associated British Foods H1, GE Q1, General Motors Q1, HSBC Q1, Iveco Q1, Kuehne & Nagel Q1, Microsoft Q3, Nomura FY, Novartis Q1, PepsiCo Q1, Texas Instruments Q1, UBS Q1, United Parcel Service Q1WednesdayFresnillo Q1 production reportFrance, consumer confidence figuresGermany, Gfk consumer confidence figuresUK, Freedom of Information statisticsUS, Q1 housing vacancies and home ownership dataResults: Boeing Q1, Credit Suisse Q1, Daiwa Securities Group Q4, Deutsche Bank Q1, GlaxoSmithKline Q1, Lloyds Banking Group Q1 interim management statement, Mattel Q1, Mercedes-Benz Q1, Meta Q1, Puma Q1, Spotify Q1, STMicroelectronics Q1ThursdayEU, economic and business sentiment indicators plus the European Central Bank’s monthly economic bulletinDelivery Hero Q1 trading updateEvraz Q1 trading updateGermany, April consumer price index (CPI) inflation dataGlencore Q1 production report and AGMJapan, Bank of Japan interest rate decision and outlook report for economic activity and prices, plus retail sales figuresSchroders Q1 trading updateSmith & Nephew Q1 trading updateSpain, April inflation data and unemployment figuresSweden, central bank Riksbank holds its monetary policy meeting in StockholmUnilever Q1 trading statementUK, Q4 insolvency statistics plus NHS workforce data and inflation risks for public services in EnglandUS, Q1 GDP estimate plus Q1 consumer spending figuresResults: Amazon.com Q1, Apple Q2, Barclays Q1, Carlsberg Group Q1 trading statement, Caterpillar Q1, Comcast Q1, Eli Lilly and Co Q1, Hershey Q1, Intel Q1, McDonald’s Q1, Merck & Co Q1, Nokia Q1, Northrop Grumman Q1, Sainsbury’s H1, Samsung Electronics Q1, Swedbank Q1, Total Q1, VeriSign Q1FridayCanada, February GDP figuresEU, flash Q1 GDP estimate plus euro area inflation figuresFrance, preliminary Q1 GDP estimate and April CPI dataGermany, Q1 GDP figuresItaly, GDP figuresMexico, Q1 GDP dataRémy Cointreau FY sales figuresSmurfit Kappa Q1 trading update and AGMSpain, Q1 GDP figuresTravis Perkins Q1 trading updateUK, British Retail Consortium monthly economic briefing, government deficit and debt figures, Office for National Statistics data on how changes in the workforce have affected earnings growth during the Covid-19 pandemic, sickness absence data, Nationwide’s April house price index plus quarterly betting and gaming statisticsResults: AstraZeneca Q1, BASF Q1, Chevron Q1, Colgate-Palmolive Q1, Danske Bank Q1, Electrolux Q1, Eni Q1, ExxonMobil Q1, Honeywell Q1, NatWest Q1SaturdayChina, Caixin general manufacturing purchasing managers’ indexWorld eventsFinally, here is a rundown of other events and milestones this week. MondayAustralia, New Zealand and Turkey: the 107th anniversary of the start of the first world war Gallipoli campaign will be commemorated with Anzac DayChina, the UN Biodiversity Conference (COP15) opens in KunmingItaly, Liberation Day commemorating the end of Nazi occupation in the second world warNorth Korea, 90th anniversary of the creation of the Korean People’s Revolutionary ArmyUK, the last bank branch on the Isles of Scilly — run by Lloyds Bank on St Mary’s — due to close its doors todayTuesdayUkraine, anniversary of the 1986 Chernobyl nuclear power plant disasterUK, the second term of the legal year in England and Wales, the Easter term, begins and will run until May 27 US, the 26th Webby awards — ‘the Oscars of the internet’ — are announcedWorld Intellectual Property DayWednesdayIsrael, Holocaust Martyrs and Heroes Remembrance Day marked in JerusalemThe Netherlands, Koningsdag national holiday marking the birth of King Willem-AlexanderSierra Leone, National DaySouth Africa, Freedom Day marking the date when Nelson Mandela was elected president in 1994ThursdayUS, annual Take Our Daughters and Sons to Work dayFridayUK, Three-time Wimbledon champion Boris Becker faces sentencing at Southwark Crown Court in London after being found guilty of four charges under the Insolvency Act relating to his 2017 bankruptcyPortugal, parliament to vote on the working majority Socialists budget draftSaturdayPartial solar eclipse over South America, Antarctica, Pacific and Atlantic OceansUS, The White House Correspondents’ Association holds its annual dinner at the Washington DC Hilton. Sitting presidents usually attendVietnam, Liberation Day celebrating the anniversary of the fall of Saigon — now Ho Chi Minh City — to the Communist Democratic Republic of VietnamSundayChina, start of the five-day May Day holidayMay Day celebrated in various countriesUS, date to which president Joe Biden deferred student loan payments last December More

WASHINGTON (Reuters) – European Central Bank policymakers are keen to end their bond purchase scheme at the earliest possible moment and raise interest rates as soon as July but certainly no later than September, nine sources familiar with ECB thinking told Reuters.The ECB has been removing stimulus at the slowest possible pace this year but a surge in inflation is now putting pressure on policymakers to end their nearly decade-long experiment with unconventional support. The big obstacle so far has been that longer-term forecasts still showed inflation falling back below the ECB’s 2% target but fresh estimates shared with policymakers at their April 14 meeting showed even 2024 inflation over target, several of the sources said.”It was just over 2% so in my interpretation all the criteria to raise interest rates have now been met,” one of the sources, who asked not to be named said.Governing Council members have long criticised the ECB for underestimating inflation, which hit 7.5% last month, and they consider the new projection as a step in acknowledging the reality.”When (chief economist) Philip (Lane) presented the numbers, people actually clapped,” another source said. An ECB spokesperson declined to comment. No policy proposals have been tabled yet and the ECB’s next meeting is still over a month away, on June 9.ECB President Christine Lagarde on Friday said that bond buys should end early in the third quarter and a rate rise this year is likely. THREE MOVES?Nearly all of the sources said that they see at least two rate hikes this year, but some argued that a third is also possible, although highly dependent on how markets digest its moves.Markets price in around 85 basis points of hikes for this year, so more than three 25 basis point moves, which would put the minus 0.5% deposit rate back in positive territory for the first time since 2014. Unwinding stimulus, the ECB has long argued that it is merely normalising policy, is an undefined concept with no set parameters.The policymakers who spoke to Reuters, however, said that normalisation should mean returning to the neutral rate of interest, which neither stimulates nor holds back growth. They put this at around 1% to 1.25%, so 150 to 175 basis points above the current rate.”Getting to this level by the end of 2023 could be reasonable,” a fifth source said.Interest rates can only rise, however, once bond purchases conclude and all 9 policymakers, who spoke on condition of anonymity, said this should happen on June 30 or July 1.This would mean that the ECB would be in position by its July 21 meeting to raise rates. “Unless the outlook changes dramatically, I would go for July,” a third source said. Some of the sources, however, said they would still prefer to wait until September, partly because new forecasts would be available by then and partly to avoid a major policy move during the summer months, when liquidity is lower.The ECB last raised interest rates in 2011 on the eve of the bloc’s debt crisis, a move now widely considered its biggest policy mistake to date. “Memory of that move still haunts us,” a fourth source said. “Some people fear making a similar error.”The U.S. Federal Reserve is expected to tighten even more quickly. Markets see nearly 250 basis points worth of tightening this year with 50 basis point hikes due at some meetings.All ECB policymakers stressed, however, that the outlook could change radially until then as Russia’s invasion of Ukraine is a persistent threat to confidence and the COVID-19 pandemic is also not over.Some of the policymakers said that a technical recession, or two consecutive quarters of negative growth, is possible this year but the full year figure is still going to be positive. More

The planned cuts come a week after regulators encouraged smaller banks to lower the ceiling for their deposit rates. The moves will also coincide with China’s reduction in banks’ reserve requirements, effective on Monday. Bank of China will cut the rates for time deposits of 2-3 year tenors by roughly 10 basis points, according to two banking sources. Bank of Communications will make similar moves, said another source.Bank of China and Bank of Communications were not immediately reachable for comment outside working hours. It was not immediately clear if other state banks, including Industrial and Commercial Bank of China (ICBC), China Construction Bank (OTC:CICHF) (CCB) and Agricultural Bank of China (OTC:ACGBF) will also cut deposit rates, but the sources say state lenders typically move in tandem on rate moves. Beijing has repeatedly urged banks to reduce borrowing costs for smaller companies in an economy hit by COVID-19 outbreaks, fallout from the Ukraine crisis, and capital outflows triggered by U.S. monetary tightening. To prod banks to lend more, the PBOC has announced it would cut the reserve requirement ratio (RRR) for all banks by 25 basis points, effective from April 25.Rocky Fan, economist at Guolian Securities, said that cutting deposit rates could incentivize banks to reduce lending rates, by lowering their own borrowing costs. “One major reason banks are reluctant to cut loan rates now, is that the move would hurt their margins.”Lower deposit rates are also conducive to more effective use of money, and will benefit consumption and investment, Fan added. In mid-April, the interest rate self-disciplinary mechanism, a top regulatory body overseen by the People’s Bank of China, urged smaller lenders to lower deposit ceilings on time deposits by about 10 basis points, sources told Reuters.Banks including Industrial Bank and China Zheshang Bank have already made the adjustment, according to direct sources. More