News updates from July 1: US Supreme Court says Trump immune for ‘official acts’; Boeing to plead guilty to fraud or face criminal trial

Panama’s new president has pledged to halt illegal immigration through the notorious Darién Gap and work with the US government as it seeks to limit arrivals at its southern border ahead of its presidential election.

José Raúl Mulino, the right-wing leader who won the May vote, said in his inauguration speech on Monday that the country could no longer pay the economic and social costs associated with migration.

“Panama will no longer be a transit country for illegals,” he said, adding that migrants were being organised by “international groups related to drug trafficking and people smuggling”.

Last year more than half a million people crossed the Darién Gap, which stretches into Colombia, with economic and political crises in Latin America pushing people out of their home countries such as Venezuela. After leaving the jungle most migrants cross Panama’s isthmus on buses on their journey towards the US.

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Boeing must either plead guilty to felony fraud or go to trial against the US government as the next step in a criminal case stemming from its door panel blowout, according to the latest terms offered to the company by the Department of Justice. 

Under the potential plea agreement, the airline would plead guilty to one charge of conspiring to defraud the US and pay a fine of $243.6mn, the second criminal penalty of this size in the case, according to someone familiar with the matter.

The move comes after the DoJ notified Boeing it had breached the deferred prosecution agreement it signed in 2021 in the wake of the fatal Lion Air and Ethiopian Airlines 737 Max crashes.

The notification followed the mid-air blowout that terrified passengers of an Alaska Airlines flight earlier this year.

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US closed higher in the first session of the second half of the year, even as Treasury yields hit multi-week highs.

Strong gains in the technology sector helped the benchmark S&P 500 add 0.3 per cent despite almost three quarters of the index’s constituents declining on the day. The Nasdaq Composite rose 0.8 per cent, with every Magnificent Seven tech group finishing higher.

Treasuries sold off as traders weighed higher odds of Donald Trump being elected as US president later this year. The yield on the 10-year bond jumped 0.14 percentage points to 4.48 per cent, its highest level in a month.

“There are several investment implications of Trump back in the White House,” said Jack Ablin, chief investment officer at Cresset Capital. “[Most notable would be] a higher-for-longer Fed, as monetary policymakers increase the likelihood that the corporate tax cuts will be extended next year.”

Meanwhile, oil prices rose for the fourth session in a row, with international benchmark Brent crude settling 1.9 per cent higher to $86.60 a barrel.

US stocks moved higher in the first session of the second half of the year, even as yields on Treasuries rose to their highest level in several weeks.

The benchmark S&P 500 was up 0.1 per cent in Monday afternoon trading, with the consumer cyclical and technology sectors emerging as the top performers. The Nasdaq Composite gained 0.6 per cent as every Magnificent Seven tech group except Meta advanced.

Treasuries sold off as traders weighed political uncertainty in the US and France. The yield on the 10-year bond jumped 0.14 percentage points to 4.48 per cent, its highest level in a month.

In a shortened trading week, traders will receive the latest picture of the US labour market with the release of job openings data for May on Tuesday and the June non-farm payrolls report on Friday.

The owners of the Boston Celtics said on Monday they are planning to sell the team, less than a month after the National Basketball Association franchise won its league-record 18th championship.

The Celtics are expected to set a record price for an NBA team, having been valued by Forbes at $4.7bn in October.

The Celtics were purchased for $360mn in 2002 by a group led by Wyc Grousbeck, a Massachusetts native venture capitalist; Bain Capital’s Stephen Pagliuca; and real estate developer Robert Epstein.

In a statement, the team said the board of the ownership group, Boston Basketball Partners LLC, “expects to sell a majority interest in 2024 or early 2025, with the balance closing in 2028” and that Grousbeck will remain as team governor until 2028.

Millennium Management, one of the world’s largest and best-known hedge funds, was up 6.9 per cent to the end of June, according to a source familiar with the matter. 

The New York-headquartered hedge fund, which manages more than $67.7bn in investor assets, was up 10 per cent the previous year. 

Millennium is a multi-manager hedge fund that puts hundreds of trading teams to work across asset classes and strategies, all controlled by a centralised risk system to ensure the fund does not take big losses. 

The multi-manager hedge fund space, which includes competitors Ken Griffin’s Citadel and Steve Cohen’s Point72, has been the fastest-growing corner of the hedge fund market.

House Republicans have sued Merrick Garland in a bid to force the US attorney-general to hand over tape recordings of Joe Biden’s conversations with a special counsel who concluded the US president was an “elderly man with a poor memory”.

The House judiciary filed the lawsuit in the US district court in the District of Columbia on Monday.

It marks the latest escalation in a long-running dispute between Republican lawmakers and the attorney-general over the tapes of Biden’s interviews with special counsel Robert Hur.

Hur decided not to charge Biden with a crime over his handling of classified documents, but sparked a political firestorm earlier this year when he issued a report depicting Biden as forgetful and ageing.

Steve Bannon, a former White House adviser to Donald Trump who has remained one of his most vocal advocates, has surrendered to prison, making him the latest aide in the ex-president’s orbit to be incarcerated. 

Bannon, a rightwing firebrand who helped build Trump’s Maga movement, is due to serve four months in federal prison in Connecticut following a conviction for contempt of Congress. He was charged for refusing to comply with a subpoena from the congressional committee probing the January 6 2021 attack on the US Capitol by Trump’s supporters.

Bannon, former chair of Breitbart News, began serving his sentence after an extended legal fight that went all the way to the US Supreme Court, which on Friday denied his appeal. He joins roughly half a dozen Trump confidants to serve time in jail.

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The former senior investment banker at Moelis who was filmed punching someone at a New York City Pride event last month has been arrested on assault charges.

Jonathan Kaye, who resigned from Moelis a week ago following the incident, was arrested and charged on Monday morning on second- and third-degree assault charges, a spokesperson for the NY City Police Department said.

Representatives for Kaye, 52 and who is Jewish, had previously described how the altercation started after he approached four individuals with a Palestinian flag. A lawyer for Kaye said on Monday that they had shared another video with the New York district attorney showing that Kaye was acting in self-defence.

“We are hopeful that the district attorney will fully and fairly consider these facts, along with the surge of antisemitic acts, protests, and attacks that are ravaging our city,” the lawyer for Kaye said in a statement. “We will aggressively fight injustice, and we look forward to a full vindication for our client.”

The investment arm of Ingka Group, which owns the majority of Ikea stores, said it is taking a minority stake in a new tower on New York’s Fifth Avenue, one of the world’s most expensive retail strips. 

The group will hold a one-third stake in the building, while US developer Extell Development Company will own the rest. Ingka Investments said in a press release that it will have full ownership of the “prime retail space”, where it plans to create an Ikea “customer meeting point”.

“We are excited to share the news of this major investment that boosts our growth strategy across the US, a vital market for Ingka Group,” said Peter van der Poel, managing director at Ingka Investments.

Activist hedge fund manager Boaz Weinstein has vowed to continue his fight to take control of several BlackRock closed-end funds, citing the fact that his nominees for the boards of two funds garnered more total votes than the sitting directors.

The nominees put forward by Weinstein’s Saba Capital fell short of election last week because they failed to garner a majority of all votes, rather than just those cast, as required by the fund bylaws for new directors. Saba has asked a judge to throw out that requirement, and the case is moving towards trial in federal court in Manhattan.

“There is a great injustice that continues as BlackRock refuses to let its fund owners have their voices heard,” Weinstein said. 

Saba, which holds large stakes in both funds, contends that new leadership would seek to close the gaps that have emerged between the funds’ share prices and the value of their underlying assets.

US secretary of state Antony Blinken defended US President Joe Biden as a strong leader who has “reinvested America in the world,” after his debate performance raised questions of his fitness among allies.

Blinken, like many of his predecessors, often tries to stay out of US politics but made a rare dip into the fray on Monday to defend Biden, who he has worked with for decades.

“If you look at surveys around the world . . . you see again and again and again that confidence in American leadership has gone up dramatically over the past three years,” Blinken said during an appearance at the Brookings Institution think-tank in Washington.

French stocks closed sharply higher on Monday as traders bet that the second round of the country’s election this weekend would deny the far right or far left a majority in the National Assembly.

The Cac 40 in Paris rose 1.4 per cent, with banks and utilities the best performers.

Although investors welcomed the results of the first round of the legislative elections, “the discount on French financial assets is still there and, in our view, likely to stay”, said Hubert de Barochez, a markets economist at Capital Economics.

The region-wide Stoxx Europe 600 rose 0.4 per cent, Germany’s Dax gained 0.5 per cent and London’s FTSE 100 rose 0.2 per cent.

Bonds in the US and Europe sold off on Monday as traders assessed fresh economic data and the outcome of France’s snap parliamentary elections.

The benchmark 10-year Treasury yield leapt 0.14 percentage points higher in New York morning trading to 4.48 per cent, as the price of the debt instrument fell, while the policy-sensitive two-year yield also rose 0.07 percentage points to 4.79 per cent.

Germany’s 10-year Bund, the Eurozone’s benchmark, added almost 0.1 percentage point to 2.58 per cent. The UK’s 10-year yield rose 0.09 percentage points to 4.27 per cent. Yields rise as prices fall. 

Those moves followed a victory on Sunday for the far-right Rassemblement National party in the first round of France’s parliamentary elections.

The reaction in markets also followed data that showed the US manufacturing sector weakened in June.

Italian bank UniCredit has filed a legal challenge to a European Central Bank order to reduce its dealings in Russia.

UniCredit, which has the second biggest exposure to Russia among western banks, was one of several Eurozone lenders to receive a letter from the ECB in May, ordering them to speed up their withdrawals from the country.

On Monday, the Italian bank said it had applied to the European Union’s General Court to seek clarification on the ECB’s request. It added it had asked not to have to comply with the ECB’s demands while its application was being heard.

UniCredit said it had “concerns about the terms upon which this reduction has to take place as provided for in the decision issued by ECB, that goes beyond the current legal framework”.

The US manufacturing sector contracted for the third consecutive month in June, as high interest rates continued to weaken demand. 

The Institute for Supply Management said its index tracking factory activity fell to a reading of 48.5 last month from 48.7 in May, missing economists’ expectations for a reading of 49.1. A figure below 50 indicates that the sector is contraction.

“Demand remains subdued,” said Timothy Fiore, chair of the ISM manufacturing business survey committee. “Production execution was down compared to the previous month, likely causing revenue declines, putting pressure on profitability.”

Although inflation slowed with fewer companies reported higher prices, Fiore said commodity prices continued to be volatile.

Wall Street stocks began the third quarter of the year on the front foot, following European indices higher ahead of a data-packed week in the US.

The blue-chip S&P 500 rose 0.3 per cent in early trade in New York, with utilities and banks among the best performing stocks. The tech-dominated Nasdaq Composite rose 0.1 per cent.

Data due out on Friday is expected to show a further 180,000 new jobs were created in June, while the unemployment rate is forecast to hold steady at 4 per cent, its highest level since February 2022.  

Shares in pet product retailer Chewy jumped as much as 20 per cent in pre-market trade after the meme stock investor known as Roaring Kitty disclosed a 6.6 per cent stake in the company. 

The reappearance of Roaring Kitty — real name Keith Gill — on social media in May after a three-year absence boosted shares in ailing computer games retailer GameStop, which is now run by Ryan Cohen, the founder of Chewy. GameStop shares still trade 40 per cent higher than before Gill reappeared. 

Gill’s filing showed he held 9,001,000 shares — a symbolic amount to his online followers since it matches the initial stake in GameStop that Cohen purchased.

German inflation slowed in June for the first time in two months, vindicating the European Central Bank’s wager that a recent rebound in price pressure was a temporary blip, after it cut interest rates last month for the first time since 2019.

Consumer prices rose 2.5 per cent year-on-year, down from 2.8 per cent in May, according to EU harmonised data released by Germany’s statistical office.

The rate was a tad less than the 2.6 per cent expected by economists polled by Reuters. Energy prices fell 2.1 per cent from June last year but food price inflation picked up again, rising to 1.1 per cent year-on-year after 0.6 per cent in May. Inflation in services remained high and sticky at 3.9 per cent, unchanged from May.

Supreme Court: The highest court in the US is expected to issue a blockbuster ruling on Donald Trump. On its final day of decisions before the summer break, the court is to decide whether the former president has immunity from criminal prosecution for his actions related to the insurrection at the Capitol on January 6, 2021.

Markets: Wall Street begins the third quarter — and second half — of the year this morning, with the S&P 500 having last week ruled off on one of its best performances for the first six months of a year since the dotcom bubble in the late 1990s. The benchmark index has gained 14.5 per cent so far in 2024, but the gains have been propelled by a narrow group of stocks. Investors will be watching for whether the rally can continue and if it broadens out to include more sectors.

Joe Biden’s campaign has released a new advert addressing the US president’s disastrous debate performance that will air in swing states and target younger and diverse audiences, as unease about his fitness for office rises among voters.

Biden’s campaign said the ad would air on TV networks that “over-index” to younger and diverse viewers. It will also appear during sports matches and the premiere of reality dating show The Bachelorette.

The spot features footage of Biden from his North Carolina rally on Friday, when he addressed his age: “I know I’m not a young man. But I know how to do this job.”

The advert closes out with the president saying, “I know, like millions of Americans know, when you get knocked down, you get back up”.

Workers from Unite have suspended an overtime ban and called off a planned strike at Tata Steel over impending job losses, the union said. 

About 1,500 steelworkers in south Wales had been due to walk out indefinitely from July 8. Members of Unite voted for industrial action in April in protest at the decision by Britain’s largest steelmaker to shut both of its remaining blast furnaces at Port Talbot this year. 

The closures will result in up to 2,800 job losses and are part of a government-funded plan to shift to greener forms of steelmaking. 

Alun Davies, national officer for Community, the steelworkers’ union, said it welcomed Unite’s decision to “withdraw their strike action and get back around the table with their sister steel unions”.

A series of Scottish local authorities on Monday were running emergency help centres for voters whose postal voting packs had not arrived.

The issues in Scotland are particularly acute because of delays in printing some ballot papers and because many voters are away for summer holidays as the school term ended last week.

There have also been reports of problems with the delivery of postal voting material in parts of England, including in Chelmsford in Essex and Devon.

Peter Stanyon, chief executive of the Association of Electoral Administrators, said there had been some “documented” cases where postal votes had not yet arrived with people who applied for them.

“The latest information that we’ve got is that all postal votes are in the supply chain and were due to be delivered over the weekend,” he said.

Xavier Niel’s Atlas investment vehicle has launched a $4bn offer for Millicom, a Latin American telecoms company operating under the Tigo brand.

Atlas said on Monday it had offered $24 per share for Nasdaq-listed Millicom. The price is slightly below the $24.55 at which the shares closed on Friday, but a 19 per cent premium to the average price over the past 90 days.

An independent board committee said last week that an offer at $24 per share “would significantly undervalue Millicom and not be in the best interests of Millicom’s shareholders”.

Atlas already owns 29 per cent of the company.

Air France-KLM has warned it expects to take a financial hit as a “significant” number of would-be visitors to Paris avoid booking trips during the Olympics. 

The airline group said traffic to and from the French capital was lagging behind other major European cities, and added that French visitors “seem to be postponing their holidays” until after the games, which will run between July 26 and August 11.

As a result, the airline group on Monday forecast an impact of between €160mn and €180mn on revenues between June and August. 

Shares fell 1 per cent in morning trading.

UK mortgage approvals fell for the second consecutive month in May, according to data from the Bank of England that reflects the impact of high borrowing costs on the property market.

Net mortgage approvals for house purchases fell to 60,000 in May from 60,800 in April and 61,086 in March, new data showed on Monday. Approvals for remortgaging decreased slightly from 29,900 in April to 29,600 in May.  

The figure was marginally higher than the 59,900 forecast by economists polled by Reuters, but well below 65,340 in May 2019, before the pandemic as high mortgage costs continued to hit prospective buyers.

Separate data by Nationwide earlier on Monday showed that house prices unexpectedly rose 0.2 per cent between May and June. 

Big share price moves in Europe today include miner Anglo American, French media group Vivendi and London-listed chemicals company Croda.

Anglo American: Shares in the London-listed miner slipped 3 per cent on Monday after a fire at an Australian coal mine it was looking to sell led to a suspension of production.

Vivendi: Shares in the French media group rose 2.1 per cent after it announced it had reached a no-fault settlement with investors in a case related to financial communications dating back to the early 2000s.

Croda: Shares in the London-listed chemicals company fell 1.1 per cent in early trading after it announced Stephen Oxley would join as chief financial officer from rival chemicals company Johnson Matthey.

France’s blue-chip Cac 40 index rose 2.7 per cent at the open on Monday as investors bet Sunday’s snap parliamentary elections in France would result in no party winning a majority.

Marine Le Pen’s far right RN party won the first round of voting, but analysts said the result might produce a hung parliament. The euro rose 0.5 per cent against the dollar to $1.077.

The yield on French two-year government bonds rose 0.02 percentage points to 3.15 per cent. The 10-year bond fell 0.019 percentage points to 3.24 per cent.

The gap between benchmark French and German 10-year borrowing costs, seen as a barometer for the risk of holding France’s debt, narrowed to 0.74 percentage points, after last week hitting the highest level since the Eurozone debt crisis in 2012.

The UK home secretary has insisted that the Conservatives’ Rwanda scheme will have a “powerful deterrent effect” on asylum seekers coming to the UK in small boats. 

James Cleverly told Sky News on Monday that the government’s efforts to control immigration had been “hampered at every stage” by the Labour party and that asylum seekers in France were “praying” for a Labour victory. 

Later speaking to BBC Breakfast, he said Labour had taken a “sudden interest” in immigration in the few weeks leading up the election. “We’re highlighting the hypocrisy of this,” he said, adding that “a soft touch” approach by Labour would see immigration “go through the roof”. 

Shares in shipbuilder Harland & Wolff have been suspended after the company failed to publish its annual results on time.

The Belfast shipbuilder said the delay to the audited results being published was due to “ongoing discussions with its auditors regarding revenue recognition relating to the multiyear and complex nature of some of the contracts under which the company is working”.

It said its annual report would be published during the week beginning July 8, a week past the deadline according to Aim market rules.

The company remains in talks with the government over securing a £200mn export development guarantee. It said it expected ministers to reach a decision after this week’s election.

UK house prices unexpectedly rose in June according to data from lender Nationwide.

Property prices were up 0.2 per cent between May and June, following a 0.4 per cent rise the previous month, and contractions in March and April, new data showed on Monday.

The rise took the average house price to £266,604, which was 1.5 per cent higher than in the same month last year, up from 1.3 per cent in the previous month.

Both figures exceeded analysts’ expectations. Economists polled by Reuters expected a 0.1 per cent month-on-month contraction and a 1.1 per cent annual increase in prices.

France’s Cac 40 stock market index rose 2.7 per cent in early trading on Monday as investors assessed the outcome of France’s snap parliamentary elections.

Marine Le Pen’s far-right party won the first round of voting, putting it on track to win the most seats, but analysts said it might fall short of an absolute majority. “The result is probably better than feared, but not as good as the status three weeks ago pre elections,” said Mohit Kumar, an analyst at Jefferies.

The euro rose 0.6 per cent against the dollar to $1.077.

French stock and bond markets tumbled last week as investors fretted over the impact of Sunday’s election.

A fire at one of Anglo American’s coal mines in Queensland, Northern Australia, has cast doubt over the company’s plan to quickly sell the assets as part of a recovery plan.

The company suspended production at its Grosvenor mine, which produces coal used to make steel, after a fire over the weekend and said that procedures to secure the site would probably take “several months” to resolve because of damage to the underground mine.

Anglo American rejected an offer from Australian rival BHP in May and laid out a plan to sell off a number of assets including the Queensland coal mines.

RBC Capital Markets said in a note that Grosvenor accounts for a fifth of its forecast production for the coking coal division.

Morgan Stanley has joined the rush of Wall Street lenders changing their pay structures in response to the UK’s decision last year to scrap its cap on banker bonuses.

The bank, which has not yet informed staff of the decision, said in regulatory filings that it would replace the previously mandated limit with “an appropriate internal bonus cap”, but did not provide further details about how it would be structured.

“We continue to pay competitively and reward strong performance,” it said in a statement to the Financial Times.

The limit on bonuses of two-times base salary was introduced in 2014 across the EU in response to the global financial crisis but the UK removed it last year.

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Boeing has agreed to buy Spirit AeroSystems in a deal valuing the airline supplier at $4.7bn, after months of negotiations that involved the US aircraft maker as well as its European arch-rival Airbus.

The total transaction value is about $8.3bn, including Spirit’s last reported net debt, said Boeing. The deal, which values the supplier at about $37.25 per share, will bring Spirit back under Boeing’s wing after two decades apart.

Spirit clinched a deal with Boeing after it reached a separate agreement with Airbus, with the European group taking over parts of the aerospace supplier’s work on some of its own key aircraft programmes.

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