Wednesday 01/04/26

Middle East war live: Markets rebound on hopes war will end soon (Financial Times, Alexandra White, Zehra Munir, Peter Wells and Kieran Cash) shows that markets rallied when Trump said that the war would end within “two or three weeks” as secretary of state Marco Rubio maintained that US-Iran talks were ongoing and Donald Trump says US could withdraw from Iran ‘whether we have a deal or not’ (Financial Times, Steff Chávez, James Politi and Amy Mackinnon) shows the president airing the possibility that the US might pull out even if a peace deal is not reached while Donald Trump rebukes France as tensions rise with Europe over Iran war (Financial Times, Amy Kazmin, Henry Foy and Barney Jopson) gives us the latest example of Trump lashing out, this time at France for not letting US warplanes fly over its territory. Italy also denied permission for US warplanes to refuel in Sicily.

Now while Trump comes in for a lot of criticism for wading into Iran without much in the way of a plan, The EU doesn’t have an Iran war strategy either (Financial Times, Constanze Stelzenmüller) contends that Europe doesn’t have one either (although, let’s be honest, Europe didn’t invade Iran!). Lessons have to be learned for the future and some dramatic changes will be needed such as repurposing Europe’s ailing car manufacturers to defence manufacturers, the integration of renewable power across the continent with nuclear power as a backup and the streamlining of regulation, common defence procurement, energy and capital markets. Europe also needs to build up satellite capability in space, kick out rogue EU members like Hungary and include “friendly” non-members (like Norway, the UK, Switzerland and Ukraine) to get things done. Unity is needed in order to be able to stand up to bigger powers but so many countries have their own agenda to push. Right now, though, Oil soars 60% in March as Iran war chokes global energy supplies (Financial Times, Malcolm Moore, Emily Herbert, George Steer and Steff Chávez) reflects the immediate impact of the war while Iran war gives Chinese exporters chance to grab global market share (Financial Times, Joe Leahy, Cheng Leng, Wenjie Ding and Thomas Hale) highlights opportunity for Chinese factories who can keep functioning because of large oil reserves and domestic energy supplies while most others suffer.

In terms of reaction, Trump is not just sinking in the Gulf (Financial Times, Edward Luce) says that Trump’s approval ratings are falling – although they were already falling before the Iran war. He just can’t get a grip on the affordability problem that swept Biden out of office as his aggressive moves have forced China and Iran to use their respective “aces” – rare earths and the Strait of Hormuz respectively – to put him back in his box. There are now rumours that he’ll cancel the US midterm elections in November. This would be a bold move since they have not been cancelled since the first US election was held in 1789. He is also rumoured to be thinking of imposing martial law in a number of swing districts. However, it seems that the courts are starting to resist his onslaught, as evidenced by recent court decisions on ICE, tariffs and now his proposed reinterpretation of the 14th Amendment, which automatically grants citizenship to

anyone born in the US, is also looking like a battle he’s going to lose. * SO WHAT? * Trump’s re-election campaign rested on four pillars – tariffs, deportation of immigrants, the avoidance of “stupid, senseless wars” in the Middle East and the “war on woke”. He’s had limited success on the first three but regarding the “war on woke”, he’s probably done a bit too well in that he’s losing the working-class vote. He still has MAGA support for the Iran war but if his efforts don’t work in Iran he may just move on to an easier targe – Cuba.

Judge halts construction of Donald Trump’s $400mn White House ballroom (Financial Times, Alex Rogers) highlights another bit of resistance to the Trump juggernaut – this time a district court judge has ordered the president to stop building a new ballroom until Congress approves its completion. The National Trust for Historic Preservation is also suing the White House over its plans to renovate the John F Kennedy Center for the Performing Arts, saying that it has not complied with environmental laws and historic preservation procedures. The president, unsurprisingly, wasn’t best pleased.

King Charles to visit US in April despite Donald Trump’s attacks (Financial Times, Robert Wright, George Parker and Lucy Fisher) shows that the King is still set to visit Trump later this month on a state visit despite the president’s continued slagging off of Starmer and shaky relations with the UK. Royal trips are approved by the UK government and there are calls for the trip to be cancelled. If it goes ahead, it would be Charles’ first official US tour as King and the first by a British monarch since 2007. It would also mark “the 250th anniversary of American Independence”. There’s supposed to be a follow-up in the summer by Wills and Kate. * SO WHAT? * This is where Charlie boy gets to earn his money. If he can pull off a decent trip and not get the Zelenskyy treatment while improving relations with the UK and Starmer, the Royal Family’s existence will be justified. The Royal Family could do with a bit of positive PR and the UK could do with not being shut out by the Americans.

Elsewhere, Italy prepares to keep coal power stations open for another decade (Daily Telegraph, Hans van Leeuwen) highlights more drastic reactions to Iran war consequences in a major policy reversal while British companies invest in economy at second-lowest rate in G7 (The Times, Jack Barnett) cites findings from the left-leaning Institute for Public Policy and Research think tank that British businesses invest the second-lowest amount in their economy among the G7 countries at the equivalent of 11.1% of GDP in 2023. Only Canada is worse. We have also consistently been the worst country in the G7 for underinvestment by private businesses since 2008. * SO WHAT? * The think tank believes that this has held back productivity and growth in the UK for years. It probably has, but there has been a lot of uncertainty, particularly since Covid! New taxes,  higher overheads and now the Iran war have impacted business sentiment, so it’s not surprising that we’re suffering at the moment!

The Year Is Off to the Strongest Start for Big Deals Ever (Wall Street Journal, Ben Dummett and Lauren Thomas) cites LSEG data which shows that big corporate deals have have their best ever quarterly performance as there have been 22 transactions valued at $10bn or more in the Q1 of 2026. The next best quarter was in Q4 of 2015 when there were 21 such deals. It is interesting to note that the total value of deals announced globally climbed by about 29% in Q1 versus the same period a year ago – but the number of deals is down, which shows that the number of smaller deals slowed down. Despite all the uncertainty right now, deals are still getting done. Estée Lauder is in talks to buy Puig, Pernod Ricard is looking to buy Brown Forman and Tilman Fertitta is in talks with Caesars Entertainment. Unilever combines food division with spice maker McCormick in $66bn deal (Financial Times, Madeleine Speed, Oliver Barnes and Ivan Levingston) has just been announced and would create a food behemoth with a combined enterprise value of almost $66bn and annual revenues of $20bn, with Unilever owning 65% of the combined group. Unilever has been trying to exit from food for the last decade to concentrate more on faster-growing categories. Unilever’s Marmite deal with McCormick looks unpalatable (Financial Times, Lex) suggests that investor reaction to the deal has been mixed although it

makes strategic sense for Unilever. McCormick has a lot of debt and integration of the two companies could prove to be tricky.

In money-raising news, OpenAI raises $3bn from retail investors as part of record funding haul (Financial Times, George Hammond) highlights the company’s latest massive fund raising round. The company now has an implied valuation of $852bn. Meanwhile Whoop hits $10bn valuation as health tracking takes off (Financial Times, Samuel Agini) highlights an impressive valuation for the wearable device maker. The company is hoping to do an IPO within two years. * SO WHAT? * I have to say that I think Whoop is just a one-trick pony – and an expensive one at that! The wristbands themselves are quite accessible but the subscriptions to the app range from £169 to £349 per year. I think that this is a space that could be eliminated by other tech companies (like Apple) should they decide to put a bit more effort into it.

Your Summer Travel Is About to Be Hit With Fuel Surcharges (Wall Street Journal, Dean Seal) mentions the looming prospect of air travellers facing fuel surcharges. Airlines are jacking up fares, they’re introducing baggage fees and cutting back on routes in order to take the edge of the price of jet fuel. Air France-KLM has increased fuel surcharges already but Cathay Pacific is talking about introducing a new add-on fee of $200, up from the $149 customers paid in March. JetBlue is charging more for bags and the CEO of United Airlines said that fares could rise by up to 20% as a result of the higher price of jet fuel, which has more than doubled in the last three weeks. * SO WHAT? * This is a nightmare for consumers, particularly as there has been a rising trend of people booking closer to the time when they want to go on holiday. I would have thought that this will kill demand for now as people wait it out in the hope that the war will be over soon and prices will calm down. Maybe this could be good for companies like Airbnb who could potentially see more business as people decide to stay closer to home.

In other consumer news, Food price rises unlikely before summer, says boss of Sainsbury’s (The Guardian, Sarah Butler) highlights what could be the calm before the storm for food prices as the Sainsbury’s boss allayed fears of immediate price rises due to the Iran war. Still, it’s too early to tell what impact it will have in the summer months and beyond. * SO WHAT? * Farmers around the world are facing huge hikes in costs, mainly to do with the skyrocketing price of fertiliser for their crops and increased logistics costs.

Then in UK minimum wage rise has not led to economy-wide impact on jobs, analysis says (Financial Times, Delphine Strauss) we see the somewhat surprising conclusion reached by the Low Pay Commission that the chancellor’s decision to hike the UK minimum wage by 6.7% last spring hasn’t affected employment all that much. This flies in the face of businesses saying that they are cutting entry-level positions to keep a lid on costs. * SO WHAT? * A lot of economists

have been blaming this rise in the minimum wage for the high levels of youth unemployment. The incoming 4.1% rise in the national living wage will take effect this week at a time when businesses are facing a huge rise in energy bills and borrowing costs that have come thanks to the Iran war. It looks to me like the LPC is talking its own book, particularly as it looked at the impact of the minimum wage in isolation rather than in tandem with taxes that came in at roughly the same time that prompted employers to raise prices and cut jobs. This is the real world, after all…Two-thirds of UK hospitality businesses plan to cut jobs and one in seven will close, survey finds (The Guardian, Mark Sweney) cites a separate industry-wide survey of 20,000 hospitality businesses which refutes this conclusion! 64% of respondents said that they would cut jobs, 42% said that they’d cut trading hours and one in seven said that they’d be forced to close. According to the latest figures from the Institute of Directors, economic confidence has hit an all-time low.

Then in Marie Claire publisher loses a third of its value after warning of AI hit (Daily Telegraph, James Warrington) we see that the publisher, Shares In Future, saw its share price bomb by 30% in trading yesterday because of a sharp drop in traffic from Google. The advent of Google’s AI overviews at the top of its research results has decimated click-through rates. This has led to a drop in readership, digital and e-commerce revenues. Clearly a plan to get out of this rut is needed ASAP…

Meanwhile, Oracle Lays Off Workers Amid Heavy AI Investment (Wall Street Journal, Sebastian Herrera and Joseph De Avila) shows that the cloud-computing and database firm started to roll out job cuts yesterday across all business lines. The company’s share price has almost halved in the last six months as investors have taken fright about its massive financial commitments to AI datacentre build-outs. Nasty.

In a quick scoot around some of today’s other interesting stories, BlackRock looks at HSBC’s Canary Wharf tower for new London HQ (Financial Times, Julie Steinberg and Stephen Morris) highlights some potential good news for Canary Wharf although it’s not been finalised (but at least it’s in the mix!) and UK house prices rose sharply in March but Iran war expected to cause slowdown (The Guardian, Mark Sweney) cites Nationwide figures which show that UK house prices increased at their fastest rate in almost 18 months in March – but this doesn’t include the impact of the war. It warned that the war had “clouded the outlook”. I’ll say!

Then in Nike shares tumble on unexpected forecast for sales decline (Financial Times, Peter Wells) we see that Nike’s apparent turnaround under its new boss has hit a bump and the company is now saying that revenues could actually fall in 2026. It blamed tougher conditions in greater China and disruptions in Europe and the Middle East. Ouch.

Where do you stand in the whole France vs Italy debate?? It seems that I just about fall on the French side of the fence! What about you??