News updates from September 5: Oil rises above $90 a barrel, Spanish women’s football manager sacked

The former leader of the rightwing extremist group Proud Boys has been sentenced to 22 years in prison, the harshest penalty to be handed down in a case stemming from the attack on the US Capitol on January 6 2021.

The sentence for Henry “Enrique” Tarrio was handed down Tuesday by US district judge Timothy Kelly in a Washington federal court mere blocks from the Capitol, where a mob of Donald Trump’s supporters had sought to block the certification of Joe Biden’s win. Prosecutors had sought a prison sentence of 33 years for Tarrio, whom they accused of playing a major role in a plot to thwart the peaceful transfer of power that day.

Read more about the sentences from the January 6 attack here

Struggling Chilean retail group Falabella announced the resignation of CEO Gaston Bottazzini on Tuesday, after posting its fourth consecutive net loss in August.

Bottazzini, appointed in 2018, had led a push to expand Falabella’s online footprint, including an $800mn investment in its e-commerce business. The efforts have yet to pay off, with the company suffering from a slowdown in consumer spending in Chile. The country has struggled to revive its economy following a period of unrest in 2019 and the Covid-19 pandemic.

“I’m sure that during the next few years, we will start to reap the rewards of the efforts made during this challenging digitization process,” Bottazzini said.

Dominion Energy, one of the US’s biggest utilities, has agreed to sell its natural gas distribution business to pipeline giant Enbridge in a $14bn deal that highlights the seismic shifts taking place as the green transition upends America’s energy sector.

The transaction will see Enbridge purchase Dominion’s three natural gas distribution companies for about $9.4bn plus debt, making it the biggest gas utility group on the continent.

The deal is significant because it underlines two distinct approaches to creating shareholder value as the rush to decarbonise the US economy gains steam. 

Enbridge, which is largely focused on shipping oil, will ramp up its exposure to natural gas with the transaction.

Saudi Arabia’s STC Group has acquired a 9.9 per cent stake in Spain’s Telefónica valued at €2.1bn, in the latest foray by Gulf state telecom companies into the European market.

The Saudi company, which is majority-owned by the country’s sovereign wealth fund, said it was not seeking a controlling stake in Telefónica.

The purchase represented a “compelling investment opportunity to use our strong balance whilst maintaining our dividend policy,” STC chief executive Olayan Alwetaid said.

The deal comes as Gulf countries use wealth boosted by rising oil prices to search for deals. Last month, STC unit Tawal completed its €1.2bn acquisition of tower infrastructure from United Group.

In April, the United Arab Emirates investment group e& increased its Vodafone stake from 9.8 per cent to 14.6 per cent.

United Airlines has resumed flight departures from the US, after
asking federal regulators to halt them due to an equipment issue.

The ground stop issued by the US Federal Aviation Administration at
the airline’s request was lifted. The airline briefly experienced “a
systemwide technology issue” but has now “identified a fix”.

Flights were grounded for just over an hour. The airline said it
working with customers to help them reach their destinations.

United’s stock sank by more than 4 per cent on the news, before reversing losses slightly.

Vedanta will take back ownership of a key Zambian copper mine four years after Africa’s second-largest producer kicked the Indian group out of the operation, as the country seeks to revive mining investment. 

The group owned by Anil Agarwal will invest $1bn over five years to revive Konkola Copper Mines as a condition of resuming control of operations in the heart of the southern African nation’s historic Copperbelt, Vedanta and President Hakainde Hichilema’s government said on Tuesday. 

Vedanta lost control of KCM in 2019 when the government of Edgar Lungu, Hichilema’s predecessor, accused the group of a lack of investment and used a 20 per cent stake in the mine to place it in provisional liquidation. Vedanta denied the claims and launched a legal battle to secure the mine’s return.

Read more about the copper mine here

Cuba has said it is trying to block Russian efforts to recruit Cuban citizens for military operations in Ukraine, as Moscow searches for allies to bolster its armed forces.

Havana “is working to neutralise and dismantle a human trafficking network” operating in Russia that “incorporate[s] Cuban citizens living there and even some living in Cuba, into the military forces” that fight in Ukraine, the ministry of foreign affairs said on Tuesday.

It added that the Cuban government, historically a Russian ally, has launched criminal proceedings against those involved.

The announcement came a day after the White House said North Korean leader Kim Jong Un was expected to travel to Moscow to meet with president Vladimir Putin to discuss Pyongyang selling weapons to Russia.

A federal court in Alabama has ordered that a special master redraw the state’s congressional electoral map after the US Supreme Court held that an earlier version of the plan diluted votes of black citizens. 

A three-judge panel in a US district court in Alabama on Tuesday handed down an order saying the state’s latest electoral map failed to include a second district in which “Black voters have an opportunity to elect a candidate of their choice”, in violation of US voting rights laws. 

The Supreme Court in June upheld a previous ruling handed down by the Alabama court that had rejected the state’s congressional district map due to voting rights violations. 

“While we wait for a final map, my office will continue to support local officials as we ensure that we are prepared to conduct safe, secure and fair elections in Alabama,” said Wes Allen, Alabama’s secretary of state.

Spain’s football association has sacked the manager who helped the country’s women’s team win the World Cup in the wake of the scandal over an unwanted kiss.

Jorge Vilda, the team coach, was dismissed on Tuesday by the Royal Spanish Football Federation, which praised his “impeccable” conduct in a positive statement.

It did not mention the kiss Luis Rubiales, the federation’s suspended chief, planted on the lips of player Jenni Hermoso. Vilda was close to Rubiales and was one of those who stood to applaud a defiant speech in which Rubiales claimed he was a victim of “false feminism”.

Read more on Spanish football here

The European Commission is set to appoint Belgium’s Didier Reynders to the bloc’s critical competition portfolio, as incumbent Margrethe Vestager takes a leave of absence to run for president of the European Investment Bank.

The commission is preparing to announce later on Tuesday that Reynders, currently the justice commissioner, has been allocated the powerful authority to scrutinise corporate mergers and take antitrust actions against big tech firms, according to four people with knowledge of the decision.

Like Vestager, Reynders belongs to Renew Europe, the centrist liberal political group whose members also include France’s Emmanuel Macron.

Vestager’s departure comes at a time of key commission-led enforcement action against mainly US tech giants with two landmark pieces of legislation, the Digital Markets Act and the Digital Services Act.  

A top Federal Reserve official signalled the US central bank is preparing to hold its benchmark interest rate steady at its September policy meeting, saying the recent spate of economic data does not necessitate any “imminent” further monetary tightening. 

Christopher Waller, among the most hawkish members of the rate-setting Federal Open Market Committee said on Tuesday that the Fed is well-positioned to proceed “carefully” in terms of further monetary tightening following what he described as a “helluva good week of data”.

“There’s nothing that is saying we need to do anything imminent anytime soon, so we can just sit there, wait for the data and see if things continue,” he told CNBC in an interview.

Read more on the Fed here

Russian oligarch Mikhail Fridman has been issued a notice of suspicion by Ukraine’s SBU state security service in a case that accuses him of “financing” Russia’s full-scale invasion.

“To finance the Kremlin’s aggressive ‘projects’, the oligarch uses the assets of the Russian financial and investment consortium ‘Alfa Group’ controlled by him,” the SBU said in a statement.

It was not immediately clear whether or how Fridman, who lives in London, received the notice. Born in Lviv, western Ukraine, when it was part of the USSR, he became a billionaire after moving to Moscow.

This month, a Ukrainian journalist aired footage of himself confronting Fridman in London asking his views on the war. Fridman declined to answer citing advice from his lawyers.

Jeremy Hunt, the UK’s chancellor, said on Tuesday that his next big fiscal event, the Autumn Statement, will be held on November 22.

Hunt’s allies say he will use the event to try to boost economic growth, through stimulating business investment and announcing measures to help keep sick people in the workplace.

The chancellor is under pressure from Tory MPs to cut taxes but he has insisted his priority this autumn is to bring down inflation.

Treasury insiders say Hunt’s main tax-cutting event is likely to be next spring’s Budget — widely expected to the last big fiscal event before the general election.

Illumina has appointed Jacob Thaysen as its new chief executive, as the biotech group seeks to rebuild its leadership team following a bruising proxy battle with activist investor Carl Icahn.

The world’s largest gene sequencing company said on Tuesday that Thaysen, who previously led Agilent’s life sciences and applied markets group, would begin as chief executive on September 25.

Illumina’s former chair John Thompson was ousted from its board in May following a proxy battle with Icahn, who criticised management for closing the $8bn acquisition of cancer test company Grail without regulatory approval.

Former Illumina chief executive Francis deSouza resigned shortly afterwards and the company was fined €432mn for closing the deal without approval from European officials.

Read more on Illumina here

Arm plans to price its initial public offering at between $47 and $51 per share, according to an updated filing on Tuesday, raising an initial $4.9bn for its current owner SoftBank and valuing the UK-based chip designer at up to $52bn.

Cornerstone investors including Apple, Google, Nvidia, Intel and TSMC have indicated they plan to purchase up to $735mn worth of Arm shares at the IPO price, the company said.

Read more about Arm’s IPO here.

Birmingham city council has become the latest and largest local authority in the UK to declare itself effectively bankrupt after issuing a section 114 notice announcing it cannot balance its books this year.

In a statement on Tuesday, the Labour-run council, the largest local authority in the UK, said it had implemented “rigorous spending controls in July” and that government help was “a necessary step as we seek to get our city back on a sound financial footing”.

Councils across England and Wales are under growing financial stress amid rising social care costs, soaring inflation and reduced income.

Birmingham announced last month that it was facing budget shortfalls of £87.4mn for 2023/24, rising to £164.8mn in 2024/25. 

The UK’s financial regulator has vowed to take “prompt action” against banks found to be unfairly refusing service to politicians and their families, as it outlined the terms of a review thrust into the spotlight by controversy over Nigel Farage’s banking relationships. 

The Financial Conduct Authority said its previously-announced review will examine how banks define so-called politically exposed persons, how they carry out risk assessments, how they monitor evolving risks and the process for closing accounts.

“The FCA will take prompt action if any significant deficiencies are identified,” the regulator said. Action could be taken as issues are discovered by the FCA, rather than waiting for the June 2024 deadline to complete its review, a person familiar with the situation told the FT.

Discount retailer B&M has agreed to buy 51 of rival Wilko’s 400 stores for £13mn from the administrators, as the fate of the rest of the British high-street chain remains uncertain. 

The news comes amid talks between PwC and others about salvaging parts of Wilko, which went into administration last month with thousands of jobs at risk. 

HMV’s owner Doug Putman is eyeing around 200 stores following discussions with Wilko’s suppliers, less than the 300 he originally planned to acquire. He did not immediately respond to a request for comment.

B&M said it would provide more details about its plans in November when it publishes its interim results but added that it would not retain the Wilko brand. 

Germany has supplied Ukraine with the first batch of newly produced ammunition for Gepard anti-aircraft guns as part of a Europe-wide drive to respond to Kyiv’s urgent need for more firepower.

The supplies are the first shipment of a €168mn order for 300,000 rounds placed by the German government with the arms producer Rheinmetall in February.

The weapons manufacturer did not say how many rounds of the 35mm ammunition had been delivered, but said the number would reach 40,000 by the end of the year.

German defence minister Boris Pistorius hailed the speed of the delivery as evidence that his country was mobilising all possible options in its support of Ukraine.

The UK registered “subdued” numbers of domestic and inward mergers and acquisitions in the three months to June, according to official statistics.

The number of cross-border and domestic M&As involving a change in ownership was 450 in the second quarter, 58 fewer than in the previous three months, the Office for National Statistics said.

The value of inward M&A by foreign companies was £7.4bn, down £4.4bn from the previous quarter. The value of domestic M&A declined to £2.4bn, a fall of around £300mn.

M&A dropped substantially at the start of the pandemic in 2020 but strengthened during 2021 and remained relatively consistent during 2022, with the latest figures indicating “some weakening at the start of 2023”, the ONS said.

Ashtead has lowered its annual revenue growth forecast for the UK, even as the equipment rental group posted a rise in profit.

The UK-listed company said pre-tax profits in the three months to July rose 11 per cent to $585mn on a 19 per cent rise in revenue to $2.7bn.

However, it lowered its annual UK rental revenue growth forecast to between 6 and 9 per cent, from 10 to 13 per cent previously.

Ashtead said it continues to improve rental rates in the UK but this has been “insufficient to offset the inflation impact on the cost base”. Ashtead’s share price fell 5 per cent in early trading on Tuesday.

Chinese and European stocks fell on Tuesday as a downbeat business survey from China halted a rally fuelled by a property stimulus from Beijing.

Europe’s region-wide Stoxx 600 fell 0.5 per cent, extending losses into the fifth successive trading session, while France’s Cac 40 dropped 0.8 per cent and Germany’s Dax gave up 0.7 per cent. 

In China, the benchmark CSI 300 declined 0.7 per cent and Hong Kong’s Hang Seng was down 2 per cent, erasing most of the gains both indices made a day earlier, after private survey data showed that service sector activity in August declined to its slowest rate since Xi Jinping’s coronavirus controls were lifted at the start of the year. 

Big share price moves in Europe today include German lender Commerzbank, Swiss private equity company Partners Group, and British industrial rental equipment company Ashtead:

• Commerzbank: Shares in the German lender dropped 4.1 per cent in early trade after Barclays cut its rating on the stock.
  
  

  

• Partners Group: The Swiss company led gains on the Europe-wide Stoxx 600 index after it confirmed its outlook for the year and reported profits for the first half grew by nearly a fifth.
  

• Ashtead: Shares fell 5.2 per cent after it warned of softening demand in its UK business, while first-quarter revenues for the group rose 19 per cent year on year.

Canada’s Ontario Teachers’ Pension Plan is buying a majority stake in UK wealth manager Seven Investment Management from Caledonia Investments for £255mn ($321.5mn), the companies said on Tuesday.

OTPP, which has almost $250bn in assets and is known as one of the world’s most sophisticated institutional investors, said it would provide 7IM with long-term capital to pursue organic growth and mergers and acquisitions. The wealth manager runs £21bn in assets on behalf of more than 2,300 financial advisory firms and 7,000 private clients across the UK.

OTPP already has direct investments with more than C$10bn in financial services. Following the deal, 7IM will continue with its existing strategy, led by chief executive Dean Proctor.

Read more about OTPP and 7IM here.

European economic indicators: S&P Global/Cips releases August services purchasing managers’ surveys for the EU, France, Germany, Italy and the UK.

NHS waiting lists: The latest statistics, a closely watched metric of the state of Britain’s health system, are released.

Markets: Futures contracts for the Euro Stoxx 50 and FTSE 100 tipped the indices to open 0.3 per cent and 0.1 per cent lower, respectively, on Tuesday morning. Asian equities declined earlier in the day as disappointing data on China’s services sector sapped optimism over Beijing’s efforts to stimulate the country’s property sector.

Voice-recognition software maker iFlytek on Tuesday publicly launched its artificial intelligence chatbot, making it the latest Chinese company to join the race to deliver the country’s answer to Microsoft’s OpenAI.

The company said in a statement that its AI assistant, nicknamed Spark, was available on “all mainstream app stores” including the Apple and Android stores.

It added that it expected Spark’s capabilities to match those of OpenAI’s ChatGPT 3.5 in English and exceed them in Chinese by October this year.

iFlytek’s announcement comes shortly after internet search group Baidu and TikTok owner ByteDance made their chatbots available for public use.

Shares in Country Garden pared losses on Tuesday after local media reported the troubled developer had made late payments on two dollar bonds within their grace periods, avoiding its first default.

Country Garden’s Hong Kong-listed stock pulled back from a drop of almost 5 per cent to be down just 3 per cent in late-morning trading after Chinese news organisation The Paper reported the company had paid coupons totalling $22.5mn on two $500mn international bonds.

The developer initially missed those payments in early August, triggering a grace period that had been set to expire this week and stoking widespread concerns over the state of China’s vast and economically important real estate sector.

Japanese household spending declined by the most in nearly a year and a half in July as inflation hit confidence, but spending in some areas increased amid surprisingly strong economic growth.

Official figures published on Tuesday showed spending fell 5 per cent on the previous year. Economists had forecast a drop of 2.5 per cent.

Inflation dented spending in some categories such as housing and food, but so-called real core spending, which excludes certain items such as rent and vehicle purchases, increased 0.1 per cent compared with June. Spending on dining out and entertainment rose.

Japan’s economy beat forecasts to grow at an annualised rate of 6 per cent during the April-June period, but inflation has remained above the central bank’s 2 per cent target for 16 months.

Growth in China’s services sector has decelerated to its slowest rate since Xi Jinping’s coronavirus controls were lifted, as Beijing struggles to reinvigorate the country’s private sector.

The Caixin services purchasing managers’ index fell to an eight month-low of 51.8 in August from 54.1 in July, slipping closer to the 50-point level separating expansion from contraction. Economists polled by Reuters had forecast a reading of 53.6.

Business confidence also dropped to its lowest point this year, compounding China’s economic gloom as it battles large piles of debt in the property sector and local government coffers.

The official non-manufacturing PMI, which places greater emphasis on larger, state-owned groups and includes sectors like construction, came in at 51 last week.

Asian equities steadied on Tuesday morning after making sharp gains the day before when Beijing’s property-sector stimulus measures spurred optimism.

Japan’s Topix and South Korea’s Kospi were flat, while futures contracts for Hong Kong’s Hang Seng pointed the index to open 0.5 per cent lower. The Topix and Hang Seng gained 1 per cent and 2.5 per cent, respectively, on Monday.

The advances were driven by measures from Beijing designed to prop up China’s massive property sector, which has been wracked by a renewed liquidity crisis in recent months.

But on Tuesday morning, traders refocused on the country’s economic woes as they anticipated the release of privately compiled purchasing managers’ indices for the service sector.

Australia: The country’s central bank makes an interest rate decision. Economists expect the Reserve Bank of Australia to leave the cash rate unchanged at 4.1 per cent. The country also releases retail sales figures.

Asean: Leaders of countries in the Association of Southeast Asian Nations convene for a summit and the Indo-Pacific Forum in Jakarta, Indonesia.

Markets: Asian equities were set to decline on Tuesday morning, giving up some of the sharp gains they made the day before when Beijing’s stimulus measures spurred optimism. US markets were closed on Monday for Labor Day.

Alan Joyce will stand down as Qantas chief executive two months earlier than planned after the airline was sued by the country’s competition regulator for selling tickets for thousands of flights that it had already cancelled.

Joyce has been Qantas chief executive for 15 years and was due to hand over to Vanessa Hudson later this year.

The airline reported a record profit last month. But the regulatory action potentially exposed the company to a penalty worth hundreds of millions of dollars, leading unions to question Joyce’s bonus and retirement package.

“The best thing I can do under these circumstances is to bring forward my retirement,” Joyce said in a statement.

Kim Jong Un, the North Korean leader, expects to travel to Russia to meet Russia’s President Vladimir Putin to discuss weapons sales to Moscow, a senior White House official said on Monday.

A meeting between Kim and Putin would significantly step up military ties between Russia and North Korea as Moscow’s occupying forces try to contain a counteroffensive in the southern and eastern part of Ukraine.

Washington has been growing increasingly alarmed at the possibility of a growing weapons trade between Moscow and Pyongyang at a critical moment in the Ukraine conflict.

Read more about Kim’s plan to travel to Russia here.

Apple and Microsoft, the most valuable companies in the US, have argued some of their flagship services are insufficiently popular to be designated “gatekeepers” under landmark new EU legislation designed to curb the power of Big Tech.

Brussels’ battle with Apple over its iMessage chat app and Microsoft’s search engine Bing comes ahead of Wednesday’s publication of the first list of services that will be regulated by the Digital Markets Act.

The legislation imposes new responsibilities on the tech companies, including sharing data, linking to competitors and making their services interoperable with rival apps.

Read more about Apple and Microsoft here.

Southern African leaders were largely absent as Emmerson Mnangagwa was sworn in for a second term as Zimbabwe’s president, as the country’s opposition sought to rally the region to back a rerun of the disputed vote.

South Africa’s Cyril Ramaphosa, Felix Tshisekedi of the Democratic Republic of Congo and Mozambique’s Filipe Nyusi attended Monday’s inauguration in the capital Harare, but 12 other leaders from the Southern African Development Community stayed away.

Mnangagwa, an 80-year-old former spymaster who first took power after a military coup overthrew Robert Mugabe in 2017, was officially re-elected last month with 52.6 per cent of the vote, versus 44 per cent for his main rival Nelson Chamisa.

Read more about Zimbabwe here.

Northern Ireland’s police chief has resigned, bowing to mounting pressure after a string of scandals.

Simon Byrne announced his resignation after an emergency meeting of the Police Service of Northern Ireland’s oversight body, capping a tumultuous month for the force after it accidentally posted personal details of its nearly 10,000 officers and staff on the internet in August, exposing them to potential security threats.

Byrne faced a vote of no confidence at the police board in the coming days, brought by the pro-UK Democratic Unionist party. Officers and civilian staff were mulling similar votes.

Liam Kelly, chair of the Police Federation for Northern Ireland, which represents rank-and-file officers, said Byrne’s position had become “questionable and then untenable”.

Read more about Northern Ireland’s police chief here.