Thursday 06/11/25

Putin signals Russia may start nuclear weapons tests in response to Trump (Financial Times, Anastasia Stognei) shows the Russian president stepping things up a gear as he’s now ordered his minions to draft proposals to potentially start nuclear weapons testing. This is in apparent response to Trump’s rhetoric last week where he asked his defence department to start testing again. Here we go again…

The US president has had a bit of a tricky time of it recently. Donald Trump tries to brush off election losses as Democrats hail shift in mood (Financial Times, Lauren Fedor and James Politi) shows him downplaying the Republican drubbing in elections across the US yesterday. There’s a year to go until the midterm elections when the control of Congress is up for grabs. Meanwhile, U.S. to Reduce Flight Traffic by 10% at 40 Airports Because of Shutdown (Wall Street Journal, Alyssa Lukpat and Allison Pohle) highlights one of the day-to-day effects of the ongoing government shutdown – that traffic at 40 major airports would be cut starting on Friday – while Supreme Court appears sceptical of legal basis for Trump tariffs (Financial Times, Stefania Palma and Aime Williams) shows that US Supreme Court justices appeared to show scepticism for Trump’s use of the International Emergency Economic Powers Act (IEEPA) to back his global tariffs in a hearing yesterday. The case was brought by groups of American businesses and 12 US states who said that they’d been hit by Trump’s tariffs. * SO WHAT? * This is a bit of a downer after the high-fiving of peace in Israel and Gaza (which has not really worked) and negotiations with China (which has resulted in him walking back his threats) but he still controls the narrative and still has a lot of money and support from some very powerful people. The Mamdani thing will have annoyed him but I’m sure he’ll do his level best to make the new mayor’s job as difficult as possible. If the Supreme Court goes against him, though, it could be a real blow because he’s made so much of his aggressive tariff regime. His claim of America facing a national emergency is the cornerstone of a lot of his policies – and if this is struck down as a justification it could become problematic for Trump. Practically speaking, though, even if the justices rule against the government, there are lots of other ways that tariffs could be imposed – it’s just that using IEEPA makes them quicker to implement.

In Bank of Canada to slash 10% of jobs as Mark Carney targets public sector (Financial Times, Ilya Gridneff) we see that the Bank is going to cut 225 jobs to hit PM Mark Carney’s target for cutting public services funding. This is necessary to counter the effects of the increasingly tetchy relationship with the US. The move is part of wider plans to reduce public sector headcount by 16,000 over the next three years. A government-wide spending review was announced on Tuesday this week and the public sector is set to suffer after the civil service expanded considerably under the previous leadership of Justin Trudeau. The Bank of Canada sets monetary policy and oversees financial conditions.

Back home, there’s ongoing chat about the Budget. Rachel Reeves set to spare UK banks from Budget tax raid (Financial Times, George Parker, Sam Fleming, Ortena Aliaj and Emma Agyemang) shows that the chancellor isn’t going to target the banks after all but she is going to hit EV drivers in Reeves poised to unveil Budget plan for EV drivers to pay per mile charges (Financial Times, David Sheppard and Jim Pickard) where she’s thinking about introducing road charges for EVs from 2028, something that she reckons will raise about £1.8bn a year for the Treasury by the early 2030s. EV drivers could potentially pay 3p per mile on top of other road taxes. This would equate to the average EV driver paying an extra £250 per year. This will still rake in less than the average owner of a petrol or diesel car paying £600 a year in fuel duty. However, M&S boss: Shoppers are preparing for the worst at the Budget (Daily Telegraph, Hannah Boland) shows that the M&S boss is critical of the chancellor, saying that she’s scaring consumers into not spending and not doing enough to encourage growth but then UK services activity ticks higher in October amid resilient demand (Financial Times, Valentina Romei) would suggest that customer demand remains resilient despite everything as the S&P Global UK Services PMI came in better than expected. This is good news given how important the services sector is to the UK economy.

In crypto news, Citadel Securities and Fortress take stakes in Ripple at $40bn valuation (Financial Times, Nikou Asgari) shows that a number of investors have collectively injected $500m into Ripple, giving the stablecoin company an implied valuation of $40bn. This is just another example of how crypto continues to make its way into “mainstream” finance – which isn’t surprising given how supportive (and entwined) Trump’s administration is with the whole asset class! Ripple is aiming to become a major player in stablecoins and their infrastructure. * SO WHAT? * This new valuation means it has now overtaken US rival Circle, which is currently valued at $26bn following a flotation on the NYSE in May. It also means that it is one of the most highly valued private crypto companies in existence!

Then in US and European stocks recover after tech-driven sell-off (Financial Times, Emily Herbert, William Sandlund and Arjun Neil Alim) we see that markets recovered yesterday, powered by new-found confidence/relief regarding the latest US jobs data, which came in stronger than expected. As I said yesterday, I don’t feel that there has been a major “event” to prompt a proper sustained sell-off.

AI Is Accelerating Tech Giants’ Dominance of the Ad Market (Wall Street Journal, Suzanne Vranica) observes that AI is helping tech companies like Meta and Google to take even more control of the ad market by improving ad targeting. This runs counter to expectations of an advertising slowdown resulting from tariff wars and increasingly budget-conscious consumers. Meta, Google and Amazon.com are expected to take a 56%+ share of the US ad market this year, high than the 51% two years ago, according to an analyst at Madison & Wall. * SO WHAT? * I think that it’s particularly interesting to see that the money saved by the used of AI ad-creation tools that automate some of the process of launching ad campaigns are being ploughed back into more ads! No wonder traditional ad agencies like WPP are getting left behind…

Meanwhile, AI-designed antibodies promise big boost to drug development (Financial Times, Melissa Heikkilä and Michael Peel) heralds an amazing discovery by a team led by Nobel Peace-winning scientist David Baker which has used an AI tool to create new antibodies that could accelerate drug development! The generative AI model can be used to develop completely new antibodies from scratch! * SO WHAT? * This is a potential game-changer! Not only will it accelerate drug development, it will also mean that animal testing won’t be needed! However, the acceleration in the development of antibodies is just one part of the drug development process and there are still areas that can take a considerable length of time. Still, it’s a move in the right direction!

Nvidia’s Jensen Huang says China ‘will win’ AI race with US (Financial Times, Madhumita Murgia and Cristina Criddle) highlights the Nvidia chief’s contention that China will beat the US in the AI race because of lower energy costs and looser regulation while Nvidia boss Jensen Huang dismisses fears of an ‘AI bubble’ (The Times, Katie Prescott) highlights his dismissal of growing fears of an AI bubble. He said that “I believe we’re in the beginning of the build-out. It just happens to be with very large numbers”. He maintains that the impact of AI on economies will more than justify the current valuations. Well he would say that, wouldn’t he! Still, the money keeps coming in…

Qualcomm Swings to Fourth-Quarter Loss On Tax Charge; Revenue Rises (Wall Street Journal, Katherine Hamilton) reflects a loss in Q4 for the company thanks to a big tax-related

charge although the chip and software maker actually saw a 10% increase in sales. It sounds like there are a lot of one-off elements here but recent developments would suggest that it is belatedly getting its act together on its AI offering.

Musk’s $1tn bonus tests investors’ willingness to live without him (Financial Times, Lex) reminds us that Tesla’s shareholders are going to vote on whether Musk should be allowed to get a $1tn bonus. * SO WHAT? * The choice could be decided by whether a) they just want the share price to go up, in which case the vote should go Musk’s way because this will be the way to keep him locked in, or b) they could have broader concerns about the effect it could have on pay expectations of CEOs in other companies, in which case they should vote no. The real gamble here rests on how well investors think Tesla can do without Musk. I think Tesla without Musk is pretty much unthinkable. However, we’ll see soon enough!

Snap shares jump after $400mn deal with AI start-up Perplexity (Financial Times, Hannah Murphy) highlights an initial 24% jump in Snap’s share price in after-hours trading last night following the announcement by Snap that Perplexity AI’s search engine will pay $400m for one year to feature prominently in the Snapchat app starting in 2026. Snap also announced a strong Q3 performance – and so the combination put the boosters under the share price! * SO WHAT? * This will be particularly welcome for Snap because it will open up new revenue streams for the platform. It has struggled a bit to keep the growth of its ad business up with market expectations so this is good news. Maybe there will be more such deals to come?

The Next Big Quantum Computer Has Arrived (Wall Street Journal, Isabelle Bousquette) highlights an important development in quantum computing as Quantinuum, one of the biggest players in quantum computing, unveiled its latest computer yesterday, called the Helios. * SO WHAT? * This is just the latest development in a string of quantum developments recently in both hardware and software. Everyone is aiming to develop a machine that can deliver reliable answers to problems that will be of major commercial value. Everyone says that the results will be transformational but it seems to me that no-one quite knows what the practical applications are actually going to be at this stage!

France says it will ban Shein in row over sex dolls and weapons (Financial Times, Adrienne Klasa) highlights the strength of anti-Shein feeling in France as interior minister Laurent Nuñez filed a legal request yesterday to block Shein’s website after childlike sex dolls and a large number of weapons were found for sale on its marketplace. French authorities launched an investigation into Shein, Temu, Wish and AliExpress. Shein said that it had temporarily suspended all marketplace sales in France while it conducted a comprehensive review. In the meantime, Shein was trying to open its first permanent shop in the centre of Paris. * SO WHAT? * Shein just seems to me to be dodgy as – and they continue to ignore and flout laws designed to protect employment practices and IP. The thing is that the company comes under constant attack

and yet, despite that, they keep pushing on! It’ll be interesting to see how things go in France. If Shein gets kicked out, it would in theory be a victory – but their online capability is so vast and their prices so tempting that customers just can’t seem to help themselves!

Then in Luxury tiles retailer collapses in latest high street casualty (Daily Telegraph, Hannah Boland) we see that Fired Earth has had to shut all of its high street stores after falling into administration. The company has had a rough few years and is now the latest casualty of the high street.

In a quick scoot around some of today’s other interesting stories, Pfizer matches Novo bid for obesity biotech Metsera as takeover battle rages (Financial Times, Oliver Barnes, James Fontanella-Khan and Patrick Temple-West) shows that Pfizer is willing to fight to keep its bid for Metsera on track by embarking on a bidding war but There is only one winner in the Pfizer Novo Nordisk showdown (Financial Times, Lex) suggests that, when all is said and done, the biggest winner from all this will be the Metsera shareholders who will get a better offer than the one they had originally expected! It looks highly likely now that Pfizer or Novo Nordisk will overpay for what seems to be an unproven asset…

Then in McDonald’s bucks dining industry downturn with cost-conscious pitch (Financial Times, Taylor Nicole Rogers) we see that McDonald’s managed to buck the gloomy trend of fast food restaurants by benefiting from new promotions and new menu items over Q3. This is all the more impressive because rivals have been reining in forecasts as lower-income customers are slowing their spend dramatically.

I think that I’ve given you a few examples of this before, but this video reminds me of the time that I took on the client base in Ireland in my stockbroking days. Until then, I’d really had hardly any contact with this market – so some of these names were a big shock to me! Here’s a more comprehensive example of how to pronounce Irish girls’ names and here’s one on boys’ names! How would you have done??