Reddit aims for $6bn stock float; bitcoin at new record high – as it happened

View image in fullscreen

Europe is unprepared for war with Russia or the risk that Donald Trump could withdraw the US from Nato and needs to ramp up spending on defence equipment, the boss of Airbus has said.

Guillaume Faury, the chief executive of Europe’s biggest aerospace and defence company, said it was a “defining moment” for the continent’s defence industry, after Russia’s full-scale invasion of Ukraine in 2022 brought war to western Europe’s borders.

“We are coming from peacetime,” Faury told the Guardian. “I don’t think Europe has yet the level of preparedness that you would need for a conflict between Europe and Russia. Let’s call a spade a spade. And it seems like Russia is ramping up its defence capabilities.

You can read the interview here:

Stock markets have fallen back across the world on Monday, but investors will be more focused on important data to come in the next few days.

In the US traders’ eyes will be on inflation figures, due on Tuesday. Economists expect price rises to remain at 3.1%, according to a poll.

Any surprise either way has the potential to prompt a scramble by investors to readjust. The Federal Reserve is due to announce its latest monetary policy decision next wee. Nobody expects any movement, but investors are nervously awaiting signals for when the Fed will consider cutting interest rates – once inflation falls durably.

Reuters reports:

An unexpected uptick in consumer and producer price pressures in January has raised some fears that inflation could see another bout of strength. Traders will be watching Tuesday’s data for confirmation that inflation is staying sticky, or for proof that January’s data was an anomaly due to seasonal factors.

In the UK the Office for National Statistics will publish labour market statistics on Tuesday. Unemployment is expected to stay steady at 3.8%, according to Reuters polling.

Imogen Bachra, head of non-dollar rates strategy at NatWest bank, said:

Given that wage growth is one of the MPC’s key indicators in determining the underlying persistence of inflation (and that there still exist question marks over many other parts of the labour market data set), this week’s wage growth will be important in determining the BoE’s reaction function over the coming months.

She said the data will not “add fuel to the early rate cut fire” because wage growth will stay about steady at an annual rate of 5.6%. However, that will not be enough to give the Bank of England the green light to slash rates at its next meeting on 21 March.

That will be followed on Wednesday by UK GDP data for January. The economists’ consensus is for a 0.2% rebound. That would provide some small relief to prime minister Rishi Sunak, after December’s data showed that the UK entered recession at the end of 2023.

If a rebound is confirmed (and watch out for revisions), that would probably eliminate any chance of an “early” interest rate cut, according to Matthew Ryan, head of market strategy at financial services firm Ebury. He said:

As things stand now, markets are not pricing in a full chance of a cut until August, a relatively hawkish stance that is providing solid support for sterling.

Wall Street’s main stock indices have followed their European counterparts lower on Monday morning.

The S&P 500 is down 0.5%, the tech-focused Nasdaq is down 0.4%, and the Dow Jones industrial average has dropped 0.4% as well in the first hour of trading.

One of the largest military contractors in the US paid commissions to a Saudi company later alleged to have been a conduit for bribes for the kingdom’s royal family.

You can read the latest installment in the Guardian’s investigation of a Saudi defence deal here:

View image in fullscreen

Messaging app Telegram has 900m users and is making “hundreds of millions of dollars” in revenues, according to its secretive founder.

Russian-born founder Pavel Durov is based in Dubai. He has not given an interview since 2017, the Financial Times said:

Durov, who fully owns Telegram, said the company had “been offered $30bn-plus valuations” from potential investors including “global late-stage tech funds”, but has ruled out selling the platform while it explores a future initial public offering.

The interview has some interesting details about Durov’s relationship with his mother country: he says he fled Russia in 2014 after secret services asked for details on Ukrainian users of VKontakte, a Facebook-equivalent social network that made Durov perhaps Russia’s most prominent tech founders. Russian president Vladimir Putin launched a covert invasion of eastern Ukraine in 2014, before a full-scale assault in February 2022. Telegram has also been used prominently during the war on Ukraine.

Durov has already been a notable advocate of freedom of speech, and has resisted calls for increased moderation of content on Telegram channels, which can be used to broadcast to thousands of people. He said:

Unless they cross red lines, I don’t think that we should be policing people in the way they express themselves. I believe in the competition of ideas. I believe that any idea should be challenged … Otherwise, we can quickly degrade into authoritarianism.

People from ethnic minority backgrounds now lead 12 of the UK’s top 100 listed companies, according to a wide ranging review into diversity in business, up from the seven recorded last year.

The latest figures from the Parker Review also show that 96 of the top 100 companies had at least one ethnic minority board member as of 31 December 2023, but only 56 firms had more than one.

Diploma, Frasers Group, Howden Joinery and Intermediate Capital Group were the companies without any representation.

The Parker Review was launched in 2017 and carries out a voluntary annual census on ethnic minority makeup of boards of the FTSE 350 companies, and the 50 largest private companies.

On its launch it set the target for every board in the FTSE 250 to have at least one board member from an ethnic minority background by next year, while all FTSE 100 companies were tasked with hitting the goal by 2021.

Of the 222 FTSE 250 companies that responded to the survey, 175 (79%) had some ethnic diversity on their board, which was an increase from the 149 that met the target last year.

The review chair David Tyler described the figures as showing “good progress in driving up diversity” but urged those in the FTSE 250 to do all they could to increase numbers over the coming 12 months.

For the first time, the review also looked into representation in senior management teams, which showed that 13% of all FTSE 100 managers being from an ethnic minority background, and 12% of FTSE 250 firms.

The committee team did find that only 36 of the 50 private companies that it had invited to respond, had provided figures, and called for more responses in future years.

Of those that did respond, 22 (61%) had at least one board member from an ethnic minority background. The review has set a target that all private companies have at least one ethnic minority board member by 2027.

A quick check-in on bitcoin … shows it has hit a new record high.

The new tidemark is $72,259, according to Refinitiv. The cryptocurrency is up by 5.3% today (although that is a relatively meagre move for an asset that has been known for extreme volatility as speculators pile in and move out).

From mid-January though, with a few exceptions, it has been a one-way movement in the bitcoin price, from below $39,000 to above $72,000.

View image in fullscreen

And here is an updated five-year chart. It shows what might well come to be known as the FTX dip – when the collapse of one of the biggest exchanges caused chaos in the market.

It also represents one of the fastest stories of multi-billion-dollar hubris followed by nemesis in financial market history: the fall of Sam Bankman-Fried. The former crypto entrepreneur is now fighting against a 100-year prison sentence for perpetrating one of the biggest frauds of all time.

View image in fullscreen

11 Mar 202408.19 EDT

Heathrow enjoys record February with busiest year expected

Gwyn Topham

View image in fullscreen

Heathrow airport saw further growth last month with its busiest-ever February, as passenger numbers surpassed pre-Covid levels.

The London hub averaged 200,000 passengers per day through the month, with the leap year bringing the total to 5.8m passengers – although it had hit the monthly record before the extra day.

Numbers were up 10% from last year, while the half-term holiday was its strongest to date, with more than 2m passengers travelling through, boosted by the winter sun and ski market.

The airport has reported record traffic in three of the past four months and is expecting 2024 to become the busiest on record.

Heathrow chief executive Thomas Woldbye is expected to unveil further plans to maximise capacity at the London hub in the coming months, including a decision on whether to push forward plans for a third runway.

View image in fullscreen

UK culture secretary Lucy Frazer has received reports submitted by competition and media regulators ahead of deciding whether a more detailed regulatory probe is needed into a planned £600mn takeover of one of the Daily Telegraph owner by a UAE-backed consortium.

Reports on the proposed takeover for the Daily Telegraph and Spectator magazine were submitted to Fraser by 9am on Monday by Ofcom, the media regulator and the Competition and Markets Authority (CMA), which examines monopoly issues. The CMA confirmed in a statement on Monday that it had delivered its report to Fraser on jurisdictional and competition matters.

The proposed deal by RedBird IMI has been fiercely opposed by many Tory MPs and peers who have raised concerns about press freedom. Redbird IMI is a partnership between a fund backed by sheikh Mansour bin Zayed Al Nahyan, the UAE’s vice-president, and the US investment firm RedBird Capital Partners.

Redbird IMI is majority owned by International Media Investments (IMI) backed by sheikh Mansour. Mansour is best known in the UK as being the ultimate owner of Manchester City football club. US investor Redbird is run by Jeff Zucker, a former CNN president.

IMI has teamed up with Redbird for the transaction which aims to take over the titles in exchange for repaying £1.15bn of debts owed to Lloyds Banking Group by its current owners, the billionaire Barclay family.

Grounds for ministers to refer a media takeover to a detailed investigation by regulators include the need for accurate presentation of news, free expression of opinion and – specifically regarding newspapers – a sufficient plurality of views and persons with control of ownership.

View image in fullscreen

Social network Reddit is hoping for a valuation of as much as $6.4bn when it floats shares on the New York stock exchange.

Reddit said it will sell 22m shares valued at between $31 and $34 each, in a filing published on Monday.

The social network is one of the most popular forums for online culture, with “subreddits” on a huge array of topics. However, it is still lossmaking – it lost $90m in 2023.

The listing will not be Reddit’s first run-in with financial markets. One subreddit, r/wallstreetbets, was behind a huge surge in market volatility in early 2021 when retail investors banded together to ruin hedge funds shorting various companies, including retailer GameStop and cinema chain AMC Entertainment.

It will be intriguing to see if Reddit itself becomes a target of those same retail investors. The company is certainly aware of the risks: it said r/wallstreetbets could cause “exteme volatility:

Advance Magazine Publishers is the company’s largest shareholder, with a 30.1% stake, while the Chinese multinational Tencent has 11%.