Thursday 26/06/25

Nato promises historic rearmament shift in bid to win over Donald Trump (Financial Times, Henry Foy, Steff Chavez and Anne-Sylvaine Chassany) shows that NATO is promising that its members will raise defence spending to 5% of GDP by 2035 in an effort to appease Trump and get him to continue to maintain existing commitments in Europe. In a NATO summit at The Hague, Trump told the 31 allies that he was “with them all the way”. Donald Trump changes tune on Volodymyr Zelenskyy and Putin (Financial Times, Christopher Miller and Steff Chavez) shows that the president has once again changed his assessment of the Ukrainian leader, describing him as “very nice”, whilst also mildly admonishing Putin, who “really has to end that war”.

Back in the US, Donald Trump brands Zohran Mamdani a ‘100% Communist Lunatic’ (Financial Times, Guy Chazan) reflects the president’s assessment of the mayoral candidate who was a surprise winner in the Democratic primary. Among other things, Mamdani promised to freeze rents and increase taxes on the wealthy to fund free buses, reduced food prices and universal child care. Wall Street reels from Zohran Mamdani’s victory in New York mayoral primary (Financial Times, James Fontanella-Khan, Amelia Pollard and Sujeet Indap) shows that Wall Street was none too pleased about Mamdani’s victory either and various big cheeses in the finance world immediately looked at the best way of finding a centrist challenger before the mayoral election in November.

Meanwhile, UK to focus new trade strategy on boosting services exports (Financial Times, George Parker, Peter Foster and Ashley Armstrong) brings our attention to today’s announcement from Starmer where he’ll outline a new trade strategy that will focus on the export of UK services. He’ll also talk about how we’ll defend against an influx of product that was destined for America but now needs to find new buyers! Chinese exports to UK rise as firms seek to avoid US tariffs (The Guardian, Heather Stewart) confirms the need for such protection as it cites data from the Chinese government which showed that exports to the UK in May increased by 16.1% versus May last year! * SO WHAT? * Given that pretty much three-quarters of our GDP comes from the service sector, it’s about time that there was a proper and coherent strategy to make the best of what we do best! It’ll be interesting to see the detail. I would have thought, though, that the main danger for imports will be more in manufacturing…

Then in Keir Starmer bats away welfare rebellion threat as ‘noises off’ (Financial Times, Anna Gross, David Sheppard and Jim Pickard) we see that the PM has rejected claims that rebellion from his own party on welfare reforms could precipitate the end of his tenure at number 10. He remains confident that his divisive package will pass the Commons vote next week but this is the biggest rebellion of Labour MPs so far.

Meta wins artificial intelligence copyright case in blow to authors (Financial Times, Cristina Criddle) highlights a big win for Meta and a bitter blow for authors over the use of millions of books to train its AI models. A federal court judge has decided that the absorption of all the books, academic articles and comics by Meta’s AI models constituted “fair use” because they had been used to develop a transformative technology. However, it is worth noting that the judge said that the decision was a reflection of the authors not properly making their case rather than the lawfulness of Meta using copyrighted materials. * SO WHAT? * This is the second case this week that has found in favour of the AI models (Anthropic won another similar case on Monday), but it doesn’t sound like this will be the end of it. When the judges are giving you advice about how to sharpen your arguments, you know there’s hope!

Meanwhile, Meta boss praises new US army division enlisting tech execs as lieutenant colonels (The Guardian, Robert Booth) shows that Meta’s CTO has now become a lieutenant colonel in Detachment 201, a unit in the reserves which that US army says will “fuse cutting-edge tech expertise with military innovation”. The unit has taken on some major top bods at Palantir, OpenAI and Thinking Machines Lab. * SO WHAT? * Such recruitment shows how important AI is becoming to the military but Big Tech’s push into military AI is troubling (Financial Times, Jonathan Guyer) highlights misgivings about this growing relationship because AI isn’t 100% reliable and “hallucinating” in a military context can cost lives. There’s always the chance that it could be hacked as well. The fact that many AI companies are neither transparent nor particularly accountable also doesn’t engender trust. OpenAI recently announced that it had won its first Pentagon contract, Google Cloud is working with Lockheed Martin on generative AI, Meta has changed its policies so that the military can use Llama AI and Anthropic has partnered up with Palantir to get Claude into the military. It looks like the relationship is deepening – and I wonder whether this will mean that it will be even more difficult for tech companies to be brought to account for undesirable behaviour…

Nvidia shares hit record high on renewed AI optimism (Financial Times, Michael Acton) just highlights a return to form for the chip maker as it edged ahead of Microsoft to become the world’s most valuable company in trading yesterday, marking a major turnaround since its shaky start to 2025 when the emergence of China’s DeepSeek caused mass-panic. Investors will no doubt have been even more buoyed by CEO Jensen Huang’s bullish outlook at its AGM yesterday. He got very excited about the “multitrillion-dollar opportunity” of AI and robotics.

Elsewhere, Dating app sacks hundreds of staff as Gen Z goes old-school (Daily Telegraph, Alex Singleton) shows that matchmaking service Bumble announced plans to cut a whopping third of its staff as part of a broader restructuring of the company. Bumble has been driven to do this because Gen Zs in particular are losing interest in dating apps, opting instead for more old-school ways of meeting partners like via sports clubs and mutual friends – and even Strava! A poll from Ipsos found that 63% of men and 66% of women aged between 16 and 24 prefer to meet partners IRL rather than via an app. Fun fact: women only account for 35% of users on dating apps because of safety and stalking concerns. * SO WHAT? * It seems that younger people now have dating app fatigue after the apps’ popularity peaked under lockdown. Bumble’s share price has cratered by an eye-watering 92% over the last five years while Match Group,

which owns Tinder among many many other brands, has seen its share price fall by 68%. TBH, I would have thought that there will always be a market for these apps – they will “just” have to find something new to get people excited again. No doubt this “new thing” will have something to do with AI?!? On a related note, I’ve often wondered why LinkedIn doesn’t offer a Tinder-like experience for jobs. If both sides have the option of “swiping right” you could potentially eliminate the huge amount of garbage you get when posting job ads. LinkedIn could even offer AI selection criteria for the employer side of the equation – for an extra fee – that would mean recruiters wouldn’t have to plough through all the “swipers”. To stop candidates spamming, I think it’d be a good idea for the number of “right swipes” to be limited on the candidate side and there would have to be some proof that they had actually READ the job ad (e.g. tick boxes in the appropriate areas, perhaps a little test at the end?). Sooooo many applicants don’t bother with even the basics…

Then in Apple-related news, Carmakers push back against Apple’s takeover of the dashboard (Financial Times, Kana Inagaki and Michael Acton) firstly highlights the release of Apple CarPlay Ultra and secondly, carmakers’ pushback. Brands including Mercedes-Benz, Audi, Volvo, Polestar and Renault said that they were not planning on bringing the upgraded software to their vehicles despite Apple’s previous assumption that they would. Why is this? Well it’s because there’s a feeling among carmakers that Apple is trying to encroach on their turf. CarPlay Ultra connects your iPhone not just to music and maps – but also to other vehicle information like temperature, speed and fuel use. The system allows drivers to do other things like switch the radio station and change the cabin temperature without leaving the app. Aston Martin has made the upgrade but other makers have been more reticent because they’ve been trying to develop their own infotainment systems to justify charging customers more. * SO WHAT? * I can understand why carmakers are annoyed with this because it’s getting harder and harder to make money out of car sales – particularly now with the booming popularity of Chinese cars. However, I don’t think that stopping Apple is the answer. It seems to me that car companies spend a lot of money on the software, but they are cr💩p at it. Just look at VW – it had to give up! I would say that you need to go in the opposite direction and make sure that vehicles can use as much third party tech as possible. Let’s face it – carmakers make cars. Apple makes software that actually works. If a potential buyer knows that they won’t be able to hook their phone up to a car there’s a real chance that they’ll choose a different car where they CAN do this.

Can Brad Pitt’s ‘F1’ Movie Finally Deliver Apple a Big-Screen Hit? (Wall Street Journal, Ben Fritz and Joe Flint) is an interesting article which suggests that F1 could be the hit that Apple has been looking for for so long (Apple has gone six years without a single box-office hit!). They want it to be Top Gun – but on land. At the moment, it only seems to be generating interest among older men but there’s a lot riding on it having wider appeal. Although it has had critically-acclaimed successes with TV shows such as Ted Lasso, Severance and Slow Horses, a real box office smash has so far eluded it.

In Federal Reserve unveils plans to reduce capital rules imposed after 2008 crisis (Financial Times, Martin Arnold and Claire Jones) we see that the Fed is looking at cutting capital requirements that will enable higher leverage at American banks. They could be the biggest reduction since the 2008 financial crisis. Basically, this means that banks won’t have to hold as much high-quality capital against loans and will free up cash to put to work in other areas. The current rules were established in 2014 as part of the reforms aiming to avert another financial crisis. * SO WHAT? * Big banks have been pushing for this for a while now but critics maintain that the requirements were put in place to stop any potential repeat of 2008. The Fed is planning a conference next month that will look at broader reform of US banking regulation.

Meanwhile, Deal hunger stirs among US banks (Financial Times, Martin Arnold, Akila Quinio and James Fontanella-Khan) highlights the current belief that the rate of US banking mergers will accelerate over the coming year thanks to more relaxed regulators, tighter competition and the need to put more money into technology. * SO WHAT? * There was initially a lot of excitement when Trump came to power regarding the outlook for M&A, but his tariffs spooked everyone badly. However, banking execs, lawyers and analysts are now coming round to thinking that the pace of activity will pick up once there’s more clarity about US trade policy, interest rates

and global economic prospects. There have been rumours of talks between BNY and Northern Trust but nothing concrete has been said yet. Given that America’s banking sector is still very fragmented, there is definitely room for consolidation.

Staying on the subject of M&A, though, Shell denies it is in talks to buy BP after reports of potential £60bn takeover (The Guardian, Jillian Ambrose) shows the oil major denying market speculation about it holding talks to buy rival BP to create what would be one of the world’s biggest oil and gas companies. Sounds interesting though, no?

Then in Big Four firms fined in new exam cheating scandal (Financial Times, Stephen Foley) we see that the US audit regulator has fined the Dutch arms of Deloitte, PwC and EY a total of $8.5m because “hundreds” of their naughty accountants cheated on internal training exams – including, ironically, ethics tests! The Public Company Accounting Oversight Board said that staff at all levels of seniority had shared answers or collaborated on tests which are supposed to satisfy ongoing training and education requirements. In case you were wondering about whether KPMG behaved in a more saintly fashion, they didn’t – they got fined $25m for the same kind of thing! I guess the next thing will be ChatGPT -usage in such tests…

In a quick scoot around some of today’s other interesting stories, Robert Kennedy to cease US funding for global vaccine alliance (Financial Times, Patrick Temple-West and Michael Peel) shows that anti-vaxxer-in-chief RFK is still on the warpath – now he will be stopping funding for global vaccine group Gavi that provides free jabs for meningitis, malaria and other diseases. Gavi is an international alliance that includes Unicef and the World Bank and the US health secretary said that it had failed to justify the billions of dollars it received in funding. Staying with pharma sector news, Drug ad ban could leave US pharma with a bad case of withdrawal (Financial Times, Lex) shows that the administration is thinking about imposing restrictions on B2C ads for pharma companies. * SO WHAT? * If this actually happens, this will be bad for pharma companies and bad for the TV network operators who make a lot of money out of it. The argument is that drug ads push healthcare costs up because they cajole patients towards more expensive drugs despite equally effective generic drugs being available. The pharma industry spent over $5bn on national TV ads last year! Companies spend hundreds of millions of dollars each on buying ads.

Elsewhere, Skoda electric car sales overtake Tesla in Europe after Musk backlash (Daily Telegraph, Matthew Field) heralds more misery for Tesla as Skoda EV sales have now overtaken Tesla in Europe as Musk’s popularity continues to slide while Skoda’s popularity rises. Figures from the European Automobile Manufacturers Association show that this is the fifth month in a row of falling sales for Tesla. And this is despite overall EV sales in Europe rising by 27.2% over the period!

In retail news, Asda owner slumps to near £600m loss as sales fall (The Guardian, Sarah Butler) highlights a poor performance for Bellis Finco, Asda’s holding company, as the UK’s third biggest supermarket’s nightmare continues with a near-£600m loss last year, M&S food sales slow after cyberattack (The Times, Isabella Fish) quantifies the effect of that cyberattack that happened over the Easter weekend (it was bad, but it seems like it’s bouncing back!) and Waitrose sales grow at fastest pace in three years amid M&S crisis (Daily Telegraph, Hannah Boland) highlights a decent performance over the quarter. This is great if it’s just more people loving Waitrose, but not such a great thing if customers return to M&S now that disruption is improving.

Further down the high street, Halfords makes loss after restructuring and higher labour costs (The Times, Isabella Fish) shows that the retailer fell into loss for the year thanks to restructuring costs and a write-down of the value of its retail business. It’s looking to close underperforming parts of its business but I have said in the past that I think it should ditch its bike business (although I’d probably keep the maintenance part going) and concentrate on cars given that EVs are going to be our future!

Haven’t done one of these for a while – so can you solve this puzzle?? The answer comes at the end of the video – so try not to cheat!