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Summary

  1. Oil price hits $50 but slides below
  2. FCA proposes 1% cap on pensions exit fees
  3. Amazon executive Sergio Bucher takes over at Debenhams
  4. Former pensions minister Steve Webb warns of 'moral hazard' of proposed changes to Tata's pension scheme

Live Reporting

By Karen Hoggan

All times stated are UK

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Good night

That's it from the Business Live team for another day.

We'll be back, as usual, at 6am tomorrow.

Please join us then for all the latest from the world of business - and thank you for sticking with us today.  

All quiet on Wall Street

People walking past New York Stock Exchange
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There was little movement on Wall Street on Thursday following two days of strong gains.

The Dow Jones was down a fraction (-0.13%) at 17,828.29.

The S&P 500 also edged down by 0.02%, closing at 2,090.10.

However, the Nasdaq was up marginally. It gained 0.14%, finishing at 4,901.77.

Share gains earlier this week were encouraged by investors beginning to accept that there will be a rise in interest rates in the US - maybe as soon as next month. It seems they're starting to accept that any increase would be a sign that the US economy is picking up. 

But today, "eople are taking their foot off the gas after making a bunch of money, and now they're waiting for the next data point", says Phil Blancato, chief executive of Ladenburg Thalmann Asset Management in New York. 

Google handed victory in court

 A US jury handed Alphabet's Google a major victory on Thursday in a long-running copyright lawsuit against Oracle, saying the law allowed Google's use of Oracle's software to create its Android smartphone operating system, reports Reuters.

The jury upheld claims by Google that its use of Oracle's Java development platform was protected under the fair-use provision of copyright law, bringing trial to a close without Oracle winning any damages.  

View more on twitter

US discounters doing well as department stores disappoint

Front of Dollar Tree store
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Here's the flip side to disappointing results in the last couple of weeks from"higher end" US department stores like Macy's - as reported by Reuters.

Discount retailers Dollar Tree and Dollar General have turned in better-than-expected profits as more people visited their stores and spent more on average, sending their shares to record highs. 

The two chains, which are primarily aimed at those on low incomes, were also helped by a drop in management payroll costs and lower tax bills. 

 "We are part of what I consider, in this economic environment, the most attractive sector in retail," Dollar Tree Chief Executive Bob Sasser said in a statement.

Macy's - and other department stores, including Target - have been hit by lower demand for clothes and electronics, as well as competition from online rivals.  

Philips sets price of shares in lighting division

Philips sign above factory in Germany
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Last week, the Dutch electronics firm, Philips, said it was aiming to raise at least €694m (£547m) by selling a 25% stake in its lighting business on the stock market.

Philips said the initial public offering (IPO) would allow it to focus on its health technology business.

Well, today it has set the price of the shares at €20 apiece - that values Philips Lighting at €3bn as a standalone company. 

It will be the world's biggest lighting manufacturer.

French fuel rationing 'causing anxiety and delays'

Fuel Pump on French forecourt stipulating 20 litre maximum purchase
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Many fuel stations are running short of fuel, and that is making it unpredictable for our drivers as to where they will fill up, and that's causing some anxiety and some concern, and even where filling stations have got fuel we're hearing that supplies are being rationed, so that maybe out of a tanker load of 900 litres, trucks are only allowed to fill up with about 200 litres, so again drivers are not entirely clear where they'll be able to fill up again, and this again is causing anxiety and delays.

James HookhamDeputy chief executive, Freight Transport Association

SpaceX rocket launch today

SpaceX is trying to lower the cost of space launches by re-using rockets. The company has been experimenting with landing the rockets vertically on a platform at sea, after they have launched their payloads. It's not easy. SpaceX founder Elon Musk tweets:

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Tata staff 'mainly worried about their jobs'

Sign to steel works
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We've had plenty of comment around the consultation about proposals to change the British Steel Pension Scheme today. 

But what do the people who work for Tata think?

First and foremost, it's their jobs in all honesty. The pensions... Obviously the issue around pensions doesn't go away. But it's... at the forefront of people's minds is their jobs. That's where their income is at the minute isn't it? But pensions is an ongoing issue then because it's our deferred pay - it's what we're due when we retire.

Jason WyattTata Steel employee, Port Talbot

Don't panic ...

Sticking with that industrial action in France and the resultant fuel shortages ...

There is, of course, a Bank Holiday weekend looming in the UK ...

However, one motoring organisation says for anybody planning a trip to France, there's no need to panic just yet:

The French government have substantial stocks - around 4 months worth of demand for the whole of France - and they are starting to supply that into the network. So, we're hoping it's not going to get any worse than it is at the moment. But still it's an unwelcome complication for people who've been looking forward to a hard-earned holiday.

David BizleyRAC

French blockades 'disrupting UK exports'

More on the industrial action in France, where union activists have stepped up their industrial action. Protesters - angry about labour law reforms - have barricaded motorways and bridges. 

The port city of Le Havre has been blockaded. And some UK businesses say it's already starting to have an impact ...

The blockades and the uncertainty of everything is a bit of a nightmare cos our Spanish customers are afraid to go through France because of the blockades. So they've been using Santander to Plymouth and Bilbao up to Portsmouth but there is only so many trucks they can get on each ferry so, it's causing a bit of problem with us being able to shift the fish in this nice weather, that the fishermen's actually catching.

Paul BlewittFish exporter, Cornwall

Television Centre's £1bn revamp - as seen by the WSJ

Wall Street Journal tweets

Microsoft and Facebook 'to build transatlantic undersea cable'

Cable-laying ship
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Microsoft and Facebook are to build an undersea cable across the Atlantic, the Reuters news agency reports.

The construction of the "Marea" cable will begin in August and it is expected to be completed in October 2017, it said.

McDonald's in France raided

BBC World Service

Burger and drink
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It's emerged that French investigators raided the headquarters of the fast food chain McDonald's near Paris last week, reports BBC World Service. 

Police sources say documents were seized as part of a preliminary tax fraud investigation. 

French authorities suspect McDonald's of lowering its tax bill by channelling its French earnings through Luxembourg. 

Last week, the French finance ministry sent McDonald's a tax bill for alleged unpaid taxes.  

Retired steel workers 'should not have to pay for industry's rescue'

BBC Wales Politics

More reaction to the government's consultation on the future of the British Steel pension scheme.

Welsh Labour MP, Paul Flynn says retired steel workers shouldn't have to pay for the industry's rescue by taking cuts in their pensions.

As we've been hearing, trustees of the scheme have welcomed the idea as better than seeing the scheme collapse.

Mr Flynn - who's the MP for Newport West - told BBC Wales that the nation should foot the bill to save the steel industry, not its past workers. Watch the interview here

British Steel pension scheme trustee backs changes

BBC Wales Politics

The government has launched a consultation on the British Steel pension scheme's future and - as we've been reporting - one option would be to limit annual pension increases to a lower measure of inflation.

Earlier, we mentioned a statement by Allan Johnston, chairman of the board of trustees of the British Steel pension scheme. In it he said smaller increases in steel pensions would avoid the risk of collapse and cuts.  

Well, he's subsequently been speaking to our colleagues in Wales and and he told them the changes would be better than a rescue by the Pension Protection Fund, which would result in "significant" cuts in payments. Watch the interview here

FTSE closes higher - but only just ...

London Stock Exchange sign
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Little movement on the FTSE today - it closed at 6,265.65 - a rise of just 0.04%.

Earlier it had been boosted by commodity-related shares as the price of oil hit $50 a barrel for the first time this year.

However, a short while ago Brent Crude oil had fallen back to $49.93 a barrel - though that's still up on where it was. 

Tata pensions changes could be 'least worst solution'

Tata logo at Port Talbot with two people in silhouette
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In this case, a change of escalation rates could be the least worse solution. But the potential deal on British Steel could rip a hole in one of the most fundamental principles of pension provision. It is well-established that pension benefits, once granted cannot be taken away. The government should be very cautious about sacrificing such a principle in pursuit of short term interests, even if there are tens of thousands of jobs at stake. This isn’t the first move to reduce the costs of final salary schemes. Companies have been closing schemes to new members, changing to calculate pensions on a career average rather than final salary, and incentivising deferred members to transfer out for years. Having said that, it may be a blessing in disguise. Some final salary schemes have become unsustainably expensive. The bulk of employer pension funding is being used to prop up these schemes, at the expense of younger employees in defined contribution pensions. A review of how we treat final salary guarantees could ultimately unlock better long-term pension provision.

Tom McPhailHead of Retirement Policy, Hargreaves Lansdown

Mossack Fonseca to close in Jersey, Isle of Man and Gibralter

Mossack Fonseca
AFP

The firm at the centre of the Panama Papers data leak is to end its operations in Jersey as a result of the scandal.

Mossack Fonseca is also to close offices in the Isle of Man and Gibraltar, it said.

More than ten million documents from the firm have shed light on how the rich and powerful use tax havens to hide their wealth.

The company said the leak was partly behind its decision to quit the island.

Jersey, where the company has had a small office for 20 years, was mentioned many times in the leaked documents.

Germany exports to Iran surge

German exports to Iran, especially of machines and equipment, rose significantly in the first quarter following the removal of international sanctions against the Islamic Republic, official figures have shown.

Exports to Iran surged by 7% year-on-year in the January-March period to €500m (£380m), the Federal Statistics Office said. That compares with a 0.7% rise in overall, year-on-year German exports in the same period. 

All quiet on Wall Street ...

Wall Street sign
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Little change on Wall Street so far today - though the higher oil price combined with some positive economic data has helped to buoy up shares. 

Orders for US durable goods, including everything from toasters to aircraft, rose strong in April and the number of Americans filing for unemployment benefits fell more than expected last week, as the economy picks up.   

A short while ago the Dow Jones was a shade down at 17,826.07 - a fall of 0.14%.

And the S&P 500 was also marginally down at 2,088.87 - a fall of -0.08%.

The Nasdaq was slightly higher at 4,897.74  - a rise of 0.06%.  

Could a robot do your job?

BBC technology correspondent tweets

Tata: changes to pension scheme 'in best interests' of members

More from Tata on the government's consultation on changes to the pension scheme

Sun sets behind Port Talbot steelworks
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“The British Steel Pension Scheme was set up on the basis that pension increases would be provided so long as they remained affordable. The proposed legislative changes would allow this unusual rule to operate as intended. That means it's unlikely that a regulatory change would affect other final salary pension schemes,” said Tor Farquhar, HR director for Tata Steel’s European operations. 

Tata said in its statement that the British Steel Pension Scheme is now "considerably larger than its sponsoring business, Tata Steel UK, exposing both the scheme and business to risk".

And Mr Farquhar added: “The proposed option to change future pension increases would significantly improve the funding position and risk associated with the British Steel Pension Scheme. It also produces a better outcome for the scheme’s members than entry to the Pension Protection Fund. We believe, together with the scheme’s trustees, that this is in the best interests of the scheme’s members, for both current and future pensioners.”

Greek train privatisation deadline pushed back

Greece has extended the deadline for binding bids for its railway operator Trainose and maintenance company Rosco to June 22. 

The country's privatisation agency has said in a statement that its board of directors decided to extend the deadline of 31 May to 22 June following requests from interested investors. 

The government received expressions of interest in Trainose from Italy's state railways, Russian Railways and Greek construction group GEK-Terna. 

UK government loses money on oil and gas production

BBC industry correspondent tweets

Tata Steel welcomes pension scheme proposals

Port Talbot steel plant
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Tata has said the consultation on changes to the pension scheme follows "intense discussions" between it, the government, the pension scheme trustees and regulators.

In a statement it said the consultation was the first step in a potential change to regulations which would enable the British Steel Pension Scheme to modify its benefits enabling it to become self-sustaining and remain outside of the Pension Protection Fund.

This is an important step forward which would enable a better outcome for the vast majority of members of the British Steel Pension Scheme than the benefits provided by the Pension Protection Fund. The consultation is also an important step that supports the prospect of securing a sustainable future for Tata Steel UK’s 11,000 employees. In particular, we welcome the inclusion of an option to change the way that future payments in the scheme are increased. This option, which is fully supported by the pension scheme’s trustees, provides a way for the scheme to continue to operate on a well-funded, low-risk basis indefinitely.

Tor Farquhar,Human Resources Director, Tata Steel’s European operations,

PPF would be unmitigated disaster for UK steelworkers

Trade unions Community, Unite and the GMB have released a joint statement regarding the future of the British Steel pensions scheme. 

The unions say:

A number of bidders have made it clear that the British Steel Pension Scheme (BSPS) presents a major challenge to any sale. We also fully understand the great importance of this pension scheme to both current and former steelworkers and steel communities across the UK. There has been a lot of speculation that any sale of Tata’s assets would involve the BSPS going into the Pension Protection Fund (PPF). The trade unions believe that such a move would be an unmitigated disaster. The PPF is a financial safety net but it would see every member of the scheme take an unnecessary cut in pension benefits. The financial health of the BSPS is such that going into the PPF can certainly be avoided.

Paul Smith: 'No-one cares how good you used to be'

Abercrombie & Fitch sales continue to fall

Abercrombie & Fitch
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Abercrombie & Fitch has reported lower sales for the 13th quarter in a row as traffic to its stores dropped, mainly in markets outside the United States. 

The company, whose brands include Hollister and abercrombie kids, said revenue fell 3.4% to $685.5m in the three months to the end of April.

Sales at stores open at least a year fell 4%. But losses eased to $39.6m in the period from $63.2m a year earlier. 

The art of headline writing is not dead

Labour criticises proposed steel pension plan

Commons debate

Proposed changes to the British Steel pension fund risk setting a "very worrying precedent" for other company schemes, Labour says. Shadow business secretary Angela Eagle voiced concerns over the suggestion of cutting the fund's long-term liabilities by linking it to the consumer price index (CPI) rather than the higher retail price index (RPI).

The move is thought to potentially save £2.5bn. Speaking in the Commons, Ms Eagle told MPs: "The suggested move from RPI to CPI for the British Steel pension scheme risks setting a very worrying precedent for other occupational schemes. As the House will know, this change is currently illegal." 

FTSE 100 update

Commodity-related shares helped to lift the London market as the price of oil hit $50 a barrel for the first time this year.

The FTSE 100 was up 15.98 points at 6,278.83, with mining companies among the biggest risers. Shares in BHP Billiton and Glencore were both up by more than 4%.

Among the major oil companies, BP rose 0.7% and Royal Dutch Shell was 1% higher. Brent crude stood at $50.14 a barrel, having touched $50.22 earlier. 

Shares in Daily Mail and General Trust fell 9% after the company reported an 11% fall in half-year profits to £129m.

On the currency markets, the pound was flat against the dollar at $1.4697, and fell 0.3% against the euro to €1.3145. 

Dong float could value energy company at up to £11bn

Offshore wind farm
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A planned flotation of Dong Energy could be one of the largest stock market listings this year.

The Danish wind farm company, which operates - and has proposals for - huge projects off the UK coast, has set an indicative price range for its flotation that could value the company at up to 106.5 billion Danish crowns (£11bn).

Dong said it would sell up to 17.4% of its shares in the initial public offering and that the Danish state would keep a 50.1% stake. 

The company was created 10 years ago from the merger of a Danish state oil and gas entity and five regional utilities. It has grown rapidly to become the world's largest offshore wind farm developer. 

Is Apple interested in Time Warner?

BBC economics editor tweets:

Tata has received several credible bids - Javid

Statement on steel industry crisis

Sajid Javid
BBC

Business Secretary Sajid Javid tells the Commons that Tata has received several credible bids for its UK steel assets and is now assessing them. He says it is "not the government's role to pick winners" and would not be recommending any particular one.

Mr Javid has just returned from Mumbai after meeting Tata executives.

Oil tankers backed up at French port due to strike

Nearly two dozen vessels were queued outside the French oil import terminal in Fos, southern France, held up by a strike organised by the CGT and FO unions over planned labour reforms.

A spokeswoman for the port of Marseille told Reuters that yesterday 29 oil, LNG and chemicals vessels were waiting between the wharf and harbour on Wednesday. This morning, 21 vessels including 12 carrying oil, LNG or chemicals, were waiting.

During normal busy operations, about 5 vessels would be waiting, the port authority said.

CGT port workers and dockers joined the nationwide strike on Thursday and Friday. The stoppages hitting the power, fuel and transport sectors are aimed at forcing the government to withdraw the planned labour reform bill.

Meanwhile, thousands of dock workers have poured into the square in front of the city hall of the northern port city of Le Havre, setting off smoke bombs throughout the area.  

McDonald's and the $15 Minimum Wage

BBC World Service

US union leader David Rolf on McDonald's and the $15 minimum wage.

Union leader and $15 minimum wage campaigner David Rolf tells the BBC why McDonald's has a big role to play in the campaign to raise the minimum wage in the US and improve the working conditions of its low-paid workers. Several cities and states in the US have already introduced new minimum wage laws.

British Steel pension scheme welcomes government proposals

Allan Johnston, chairman of the board of trustees of the British Steel pension scheme, has responded to the proposed changes being proposed by the government. 

he trustee of the British Steel pension scheme welcomes the government’s decision to consult on changes to the law applying to the scheme. The trustee will be writing to members over the coming days to make clear its belief that, with government support, it should be possible to modify benefits so as to allow the Scheme to remain outside the Pension Protection Fund (PPF) indefinitely and on a low-risk basis. Although this would entail future pension increases being cut back from their current levels, benefits would be more generous than those provided by the PPF for the vast majority of Scheme members. The primary focus of the trustee is to secure the best outcome for scheme members. Whilst the current pension protection framework provides a valuable safeguard for pension scheme members generally, the circumstances of the British Steel pension scheme are such that its assets could be better used in paying member benefits than potentially swelling a PPF surplus or insurance companies’ profits. The government consultation is open to the public and not everyone replying will necessarily do so with the best interests of the Scheme membership in mind. The trustee will be looking to ensure that the views of members are properly reflected in the consultation outcome.

British Steel pension deficit now £700m

Business editor, ITV News tweets

Less than a third of Financial Ombudsman complaints resolved

BBC Breakfast

1.6 million people contacted the Financial Ombudsman Service last year

If you can't get a problem with your bank, your insurance provider or your credit card company sorted your last port of call should be the Financial Ombudsman Service.A total of  1.6 million people contacted them last year, more than double the number of the previous year. But less than a third of those enquiries were resolved and only half of that number were found in favour of the consumer. Caroline Wayman from the FOS told BBC Breakfast why that proportion was so low, and why they encourage consumers to get in touch with them directly.

Pension savers shouldn't face punitive charges

And now here's theChancellor of the Exchequer's reaction to the FCA's proposals regarding pension exit fees. 

Nearly quarter of a million people have already taken advantage of the government's pension freedoms, accessing their money when it suited them. I want everyone to have the same opportunity, including people who are eligible but currently face some sort of early exit fee. And I am clear that people who've done the right thing and saved responsibly should be able to access their pensions fairly. They shouldn't face prohibitive charges that block them from exiting their current deal. That is why I placed a duty on the Financial Conduct Authority to cap excessive early exit charges and the Department for Work and Pensions will take similar steps for occupational pension schemes. I am pleased that the FCA plans to cap exit fees at just 1% for current pension holders and bans them from future contracts altogether.

George Osborne