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Summary

  1. Get in touch: bizlivepage@bbc.co.uk
  2. Pound slides after Carney comment on rates
  3. Barclays charged by SFO over Qatari investments
  4. Hammond says UK 'weary' over austerity

Live Reporting

By Simon Neville

All times stated are UK

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Good night

Thanks for reading Business Live. We'll be back at 6am sharp tomorrow with more business news and analysis.

US stocks fall as oil dips

Traders
Getty Images

US stocks fell on Tuesday as investors dumped energy shares following a dive in crude-oil prices.

The S&P 500 index closed 0.67% lower at 2,437.03, the Dow Jones lost 0.3% to 21,467.14, and the Nasdaq fell 0.8% to 6,188.03.

The prices of Brent Crude and West Texas Intermediate both dipped by more than 2% per barrel on fresh fears of oversupply in the global market.

Vince's vision

BBC World Service

It's just emerged that Sir Vince Cable is running for the leadership of the Liberal Democrats - but what would he do for the UK economy?

World Business Report asked him earlier this month.

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Oil bear market

US crude-oil prices on have fallen into bear-market territory, defined as a drop of at least 20% from its most recent peak.

The fall on the West Texas Intermediate Crude Oil Futures of nearly 3%, sent the cost of a barrel to just under $43 during trading at 4pm, East-coast time.

It means we are officially in bear territory because the WTI is down more than 20% from its 52-week high of $55.24 back in January.

US oil chart
BBC

Instagram storms away from Snapchat

Instagram
AFP

Good news for Facebook-owned Instagram, as bosses claimed it has increased the number of users for its Stories service by 50m since April.

Facebook's global head of sales Carolyn Everson told CNBC: "If you think about it a year ago when we sat together, Instagram Stories didn't exist.

"Today on the platform, we not only have 250m people using it, but actually a third (of the most viewed stories) are businesses using Instagram Stories and one million are advertisers."

But Instagram's gains have been at the cost of rival Snapchat, which saw its shares dive 3.3% to $17.29 on the back of the news.

Instagram Stories overtook Snapchat in April, when bosses said it had 200m active users.

Ms Everson said copycat allegations were not true, because Facebook invented the "Feed" format first.

Chipotle feels the heat

Chipotle store
Getty Images

US markets are still struggling today, as the low oil prices stayed at 10-month lows.

Oil and gas companies were naturally the biggest-hit shares.

But fast-food chain Chipotle was also badly dented, with shares set to record their biggest one-day fall this year.

The company saw shares drop 6.3% to $429.86 after bosses admitted marketing and promotional costs are set to rise by between 0.2% and 0.3% in the current quarter, versus the first three months of the year.

Investors in the burrito chain are worried that profits could be squeezed as a result.

Top 5 biggest paid bosses in the US

Bloomberg has pulled together a list of the highest paid CEOs in the US.

For anyone who thought British CEOs get paid a lot... Hold onto your hats.

Topping the list is the Wal-mart boss, but the list is dominated by tech firm chiefs (with notable mention to former Goldman Sachs executive John S. Weinberg, who bagged a massive sign on fee at Evercore Partners.

The highest paid UK chief executive in 2016 was WPP boss Sir Martin Sorrell taking home £40m, while the average UK chief executive bagged just over £5m last year, according to the Equality Trust

CEO pay list
Bloomberg

Qatar blockade - "no problem" claim Qataris

Saad al-Kaabi
AFP

Sticking with Qatar for a moment, the chief executive of Qatar Petroleum, Saad al-Kaabi (pictured), says he reckons the country can stay under "blockade forever" if it needs to.

Speaking to Qatar-based TV network Al Jazeera, he said the UAE, Saudi Arabia, Egypt and Bahrain blockades against the country were not working.

He explained: "With what we have prepared, we can stay under the blockade forever, and our gas and oil industries will not be affected.

"We [still] import everything we need for our industries, maybe except some logistical needs, and UAE's port of Jebel Ali will be the biggest loser [in the dispute], not us."

Russia looking positive - according to S&P

Putin
Getty Images

Going back to the comments earlier today from Standard and Poor's sovereign ratings chief, Moritz Kraemer, who was interviewed earlier today at the Global Markets Forum.

He spoke at some length about Russia's credit rating and was asked about the country's "positive outlook" position S&P has stated previously.

Mr Kraemer said: "Any renewed deepening of geopolitical risks could diminish the chances of an upgrade. This is because the consequences of a tightening sanctions regime might choke off the recovery of the Russian economy with fiscal but also potential political risks."

But he added that, despite falling oil prices the country's economic recovery is "surpassing our expectations and we have also seen progressive improvement in the Russian financial system".

Another economic powerhouse in the region, Qatar, was hinted at being downgraded though, over the recent sanctions introduced by neighbouring countries.

He said: "We do not see a wave of downgrades in the Middle East, but there are individual countries with a negative rating outlook. Among them is Qatar".

Uber introduces tipping for drivers

Uber car
Getty Images

Private hire firm Uber, which has faces some of its harshest criticism ever in recent months, said today it has introduced tipping on its app for riders in Houston, Minneapolis and Seattle.

The company has been hauled over the coals due to sexism allegations, harassment in the workplace and questionable conduct.

It led to a slew of senior executives resigning and co-founder and CEO Travis Kalanick taking an extended leave of absence.

No word on whether the tipping policy - which Uber has resisted introducing in the past - will be introduced in other countries.

But the company said it'll be adding more US cities over the coming weeks, eventually making it available throughout America.

Labour politicians demand Single Market membership

EU flag
AFP

Labour MPs are attempting to persuade its leader Jeremy Corbyn to adopt a softer approach to Brexit - echoing the voices of some of the biggest business leaders in the country.

In an open letter to the Guardian newspaper, 51 MPs, Peers and MEPs including Chuka Umunna, David Lammy and Lord George Foulkes, have called for the UK to remain a member of the Single Market.

They write: "Jeremy Corbyn has rightly said that Labour’s position on Brexit is to focus on a deal that prioritises jobs first. We are all united behind that goal. For us that means membership of the single market.

"A country can be a member of the single market without being a member of the EU and we must be clear – “access” to the European single market is both different and inferior to “membership” of the single market."

Unions vow to "smash the pay cap"

Dave Prentis of Unison
Getty Images

The Unison union is having its annual conference in Brighton today, and general secretary Dave Prentis (pictured) had some tough words for the Government.

He told assembled members that he planned to campaign against the "brutal" Trade Union Act, which aims to make it harder for unions to strike, and wanted to "smash" the Government's cap on public sector pay rises.

Mr Prentis said: "This Government's austerity pay policies have crushed public services under their heel. They have ground down public service employees. They're worried about their jobs, their families and can't go through another five years of poverty pay.

"Now is the time to shout 'enough is enough'. "This is the year to smash the pay cap. We will not stop taking industrial action because of the draconian legislation against us."

Market movements

Oil refinery
AFP

The FTSE 100 produced a rare result today - compared with its behaviour in recent months.

Typically, when the pound falls against the dollar, the FTSE rises. Logic being that, foreign investors can benefit from the low pound and stocks become "cheaper" when bought in dollars.

This then pushes up the market.

However, today was unusual because even though the pound was down (£1 is $1.2626 compared to 1.2742 dollars at the previous close) the FTSE was also down.

The biggest fallers were primarily mining giants, including Antofagasta, Glencore, BHP Billiton, Rio Tinto and Anglo American made up five of the seven biggest fallers).

And they typically fall when the oil price is down - it fell 2.2% today.

So - does this mean the FTSE starting to become more susceptible to oil price movements (as it traditionally was before the Brexit referendum) or will the dollar continue to be the major influence on the market?

Heat wave boosts Argos business

sunbathers in park
Getty Images

For those of you suffering from the heat across much of the country, there has been one big beneficiary of the hot weather.

Retail expert Steve Dresser complained earlier that Amazon had run out of fans, leading to Argos revealing it has sold nearly 100,000 fans on Monday.

Investors weren't overly impressed with the extra business though. Shares in Sainsbury's (which owns Argos) were down 1.2% today.

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Concorde comeback?

Chris Johnston

Business reporter, BBC News

Blake Scholl, Boom Supersonic boss
BBC

It is somehow appropriate that the US company Boom Supersonic used the Paris air show to say it has moved a step closer to getting a Concorde-like passenger plane in the sky.

After all, not one but two Concordes are in the museum at Le Bourget airfield, where the huge aerospace trade show is being held this week.

Boom's founder, Blake Scholl (pictured), aims to get a 55-seat passenger plane (about half the number of seats BA offered in its Concorde) flying by 2023 after getting a sub-scale demonstrator in the air by the end of next year.

Despite having the likes of Richard Branson as backers, Boom has a long way to go before passengers are forking out something like $5,000 for a return flight to New York. That would still be substantially less than the price of a ride on nosiy old Concorde, though.

FTSE closes down

Ding ding!

Stock markets across Europe have closed for the day.

The FTSE 100 index of leading companies took a 51.1 point hit, down 0.68%, to 7472.71.

Oil prices, comments from S&P and Carney's Brexit gloom all seem to have contributed to the lacklustre day.

FTSE chart
BBC

Listen: Chancellor's call for a transitional arrangement post Brexit is positive says Siemens boss

The World at One

BBC Radio 4

The Chancellor, Philip Hammond, has used a speech to city leaders at the Mansion House to say he wants to make the economy the top priority in Brexit negotiations.

He said the government did not want to shut down migration, and said the customs union could be maintained for a time after the UK leaves the EU, during a 'transitional period' to protect key industries.

The chief executive of Siemens in the UK, Juergen Maier, who is leading an industrial strategy review for the government, welcomes the idea of 'transitional' arrangements which he says, will give businesses more time to organise themselves.

Mr Maier also told Martha Kearney it had taken a while to get the Brexit talks started, but it was now important to get on with the negotiations.

Theresa May's business guru resigns

The Prime Minister's link to the business world has quit after just 10 months, according to Joel Hills at ITV News.

Theresa May has always had a difficult time trying to win the City over to her point of view - mainly due to the hardline position she took on Brexit before the recent election.

General election campaigns typically involve business leaders signing numerous letters in support of Conservative Party policies, but they were remarkably silent this time round.

The only letter that came along was last week, with the biggest business groups calling for a softer Brexit.

Chris Brannigan is a former Royal Scots Dragoon Guards Lieutenant Colonel who commanded a tank squadron to liberate Basra in 2003.

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Standard and Poor's could downgrade UK again

Standard and Poor's boss in charge of sovereign ratings, Moritz Kraemer, has been speaking to Reuters today about a range of topics.

We'll delve into some of them later.

But the main take home comments were he said S&P may not wait until the Brexit terms are known, before shifting its rating down again.

S&P cut the UK to AA from AAA after the Brexit vote last year, with a negative outlook.

He said: "We will review the UK every six months... and if necessary more often... We will be watching the economic implications, the implications for the public finances, the constitutional implications like the whole Scotland situation... and things like the currency and if it will maintain its reserve status."

Paris Air Show: Big money in defence

Chris Johnston

Business reporter, BBC News

Paris Air Show
BBC

There are planes from lesser known manufacturers such as Russia’s Irkut, and Canada’s Bombardier, as well as Embraer of Brazil; helicopters, drones, and pretty much anything else that flies. That also includes missiles, with the likes of Raytheon showing off their wares. One of its missiles, the SkyCeptor, is promoted as being “low-cost but high-performing” compared with other “hit-to-kill effectors”.

Although a new passenger jet can cost hundreds of millions of dollars, the global spend on defence aerospace technology leaves commercial aviation in its wake. It’s no wonder that the hundreds of companies exhibiting at the show go out of their way to encourage the top brass from the air forces of the world to stop way, as well as wooing slightly less visible customers.

The bulk of the aerial displays are performed by defence aircraft, be they jet fighters, transporters or helicopters performing sometimes hair-raising manoeuvres at high speed – and high decibels. An A380 might be able to carry several hundred passengers, but it most certainly cannot loop the loop.

Ford moves Focus production to China

Ford focus car
Getty Images

Car maker Ford said it will no longer build its next generation Focus in Mexico, instead the car will be built and exported to the US from China.

The current Focus will stop being made in Michigan later next year, although the plant will build trucks instead.

Earlier this year, Ford cancelled plans for a new $1.8bn small-car plant in San Luis Potosi, Mexico, and said it would build the new Focus instead at an existing plant in Hermosillo, Mexico.

But that has now been scrapped, with Chongqing, China preferred – saving $500m in costs.

Donald Trump has been encouraging companies to stop using Mexican factories to produce US goods. Although, he may be disappointed that the Focus production won't move to America.

America wakes up

US markets have all opened down today thanks to oil prices falling 2.5% to seven month lows.

The Dow Jones Industrial Average fell 19.59 points, or 0.1%, to 21,509.4

The S&P 500 lost 5.35 points, or 0.2% to 2,448.11

The Nasdaq dropped 8.06 points, or 0.13%, to 6,230.95.

Here's how oil is looking...

oil chart
BBC

Fox's takeover of Sky to be decided next week

Rupert Murdoch
Getty Images

The long attempted takeover saga of Sky by Rupert Murdoch's 21st Century Fox took a step closer to be resolved today.

Culture secretary Karen Bradley said she had received reports from the Competition and Markets Authority and Ofcom, including its “fit and proper” assessment of the suitors and will make her decision in Parliament next Thursday.

Ofcom has also completed and handed over its views on “the need for there to be a plurality of persons controlling media enterprises” and “for those carrying on or in control of such enterprises to have a genuine commitment to the attainment of broadcasting standards objectives.”

The reports, which will be published online for outside scrutiny in nine days, was supposed to be submitted on 21st April, but was delayed until today due to the general election.

Paris Air Show: Boeing vs Airbus

Chris Johnston

Business reporter, BBC News

Airbus A380
BBC

The Paris air show - the world’s biggest aerospace trade show – is taking place at the Le Bourget airfield near Charles de Gaulle airport this week. It is held every other year, alternating with the Farnborough air show, and is a vast affair, requiring very comfortable shoes – particularly given that the temperature is well over 30C here.

The giants of commercial aviation occupy the most space. Airbus, on home turf, has various models including the striking but troubled A400M military transporter on display, alongside a tweaked A380. The superjumbo has had wingtips fitted, among other more cosmetic changes, in a bid to revive airlines’ almost non-existent interest in the giant plane.

Boeing, meanwhile, has a 787 Dreamliner and a 737 Max 9 on show. The US company has announced an even bigger version of the short-haul workhorse, although at just 66 inches longer most would be hard pressed to tell the difference between it and the new 737 Max 10.

John Varley resigns from Rio

John Varley
AFP

More fallout from the SFO's decision to charge ex-Barclays executives today.

John Varley, former Barclays chief executive and one of those charged with fraud, has stepped down from the board of mining giant Rio Tinto with immediate effect.

The company's chairman Jan du Plessis said: "I am very grateful for John's outstanding contribution over the five or so years he has been on the board.

"The board holds him in the highest regard and will miss his valuable insight. Personally, I am not only losing a senior independent director, but a close colleague, whose wisdom and support I am going to miss tremendously.

"On behalf of the board I wish John the very best for the future".

No comment from Varley.

South Korean firm pays 'record' $1m ransom

South Korean web-hosting firm Nayana has agreed to pay a $1m ransom to unlock computers frozen by hackers.

It is believed to be a record amount, although it is worth noting that many ransom payments are never made public.

Nayana's chief executive revealed that the hackers initially asked for $4.4m, payable in bitcoin.

Security experts warned that firms should not pay such ransoms or enter into negotiations with hackers. Read more here

Pound still down on Carney comments

Sterling intraday graph, Tuesday 20 June 2017
BBC

And if we check on sterling - it's still trading lower following those comments by Bank of England boss Mark Carney, in which he said now was not the right time to raise UK interest rates.

It's down by about half a per cent at $1.2667.

FTSE 100 pares earlier gains

FTSE 100 intraday chart Tuesday 20 June 2017
BBC

Let's get a quick update on the FTSE 100 - and it's currently at 7,513.43, a fall of 10 points or 0.14%.

Bank of England governor Mark Carney's speech caused sterling to fall and that drove the FTSE 100 higher, on the grounds that companies in the index, which make a lot of their profits abroad, benefit from a weaker pound.

But as the graph above shows, the FTSE has since retreated from those gains.

Barclays charges: Boath will contest them 'vigorously'

Richard Boath, the ex-European head of financial institutions at Barclays, is one of those charged with conspiracy to commit fraud in a capital raising exercise during the 2008 financial crisis.

He has issued the following response.

The SFO's decision to charge me is based on a false understanding of my role and the facts. I was not a decision-maker and had no control over what the bank did in 2008. I repeatedly raised concerns about the decisions taken by the bank with both senior management and senior lawyers and was reassured that those decisions were lawful. I have co-operated fully with the SFO and FCA throughout their investigations. The evidence I have supplied is very clear: there is no case for me to answer. I will contest these charges vigorously.

Richard Boath

'Mansion House blues' hit sterling

Sterling notes and coins
Getty Images

Sterling had the "Mansion House blues" this Tuesday, says Spreadex financial analyst, Connor Campbell.

During his speech, Bank of England boss Mark Carney made it very clear that ‘now is not yet the time’ for a hike in interest rates.

According to Mr Campbell, the governor's stance was a "very public telling off for those three Monetary Policy Committee members – including the departing Kristen Forbes – who raised their hawkish hands in the June meeting".

But the governor's comments also had an immediate effect on the pound.

"With no chance of an increase in interest rates any time soon, and the continued political uncertainty – be that Brexit or the lack of stable government – in the background, investors saw little reason to prop up the pound. This meant it fell half a percent against the dollar and the euro, hitting one week lows against both," Mr Campbell said.

Honda wants UK to stay in customs union

Honda sign outside UK plant
BBC

Ian Howells, senior vice president, Honda Motor Europe has told our Business Editor, Simon Jack that he'd like the UK to remain part of the Customs Union.

He's worried about the supply of parts from smaller firms who could be impacted by any change to our current arrangement.

Unlike Honda many of them don't have the backing of big administration and legal departments to work through any of the complex arrangements that could arise.

'How I could have stolen my old car using my smartphone'

Interior of car showing potential connections it could have
Getty Images

The technology industry would like everything you own to be connected to the internet: car, fridge, toaster - the lot.

However, it throws up some new problems. This piece tells the story of one driver who had a car which he could unlock and start with his smartphone.

But when he sold it, he was amazed to find that he could still control the car.

Read the piece by Matthew Wall here.

Date set for Queensferry Crossing opening

Queensferry Crossiing
Transport Scotland

The delayed Queensferry Crossing over the Firth of Forth will open to traffic on 30 August.

The huge infrastructure project began in 2011 and was originally due to open last December.

Following the official opening, the £1.35bn bridge, which links Edinburgh and Fife, will then close temporarily to give the public a "once in a lifetime" chance to walk over it on 2 and 3 September.

Read more here

'Brexit could exacerbate slowing economy'

UK flag
Getty Images

"The economy... is slowing down from the surprisingly elevated rates we saw a year ago, and it will be good fortune if the UK can keep the economy growing at just 1%," writes respected economist George Magnus in Prospect Magazine.

"We should not forget that a deterioration in the economy is highly likely to be exacerbated by the Brexit process starting now," his article says.

Mr Magnus says the Bank of England is right to keep interest rates on hold, despite rising inflation.

Sharp bids for return to Japan's top stocks

Simon Atkinson

Asia Business Reporter

Sharp sign
Reuters

Has a corner been turned at consumer electronics firm Sharp?

Once weighed down by debt, it was bought by Taiwan's Foxconn last year.

And on Tuesday shares leapt 7.7% on news it plans to apply to be once again listed among Japan's most prestigious stocks - in the first section of the Tokyo Stock Exchange.

Meanwhile the country's benchmark Nikkei 225 had another good day - adding 0.8% to end at 20,230.41 points, its highest finish since August 2015.

Electric fan sales take off

Retail analyst Nick Bubb tweets:

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No rate hike until 2019?

We might have to wait until 2019 for an interest rate increase in the UK, says Howard Archer, chief economic advisor to the EY ITEM Club (a respected economic forecaster).

“The [Bank of England] Governor is particularly cautious over UK growth prospects as Brexit negotiations get underway. In addition, he appears to be in “wait and see” mode indicating that he wants to see the extent to which other elements of demand offset weaker consumer spending over the coming months, and whether wages start to firm up."

“We maintain the view that the Bank of England will hold off from raising interest rates in 2017. A tightening in 2018 also looks highly questionable given the cloudy outlook.”

Tesco customers complain over cancelled orders

BBC online personal finance Brian Milligan reporter tweets:

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Pound to be stuck in a range?

The pound has recovered a little from the dive it took after comments from Bank of England governor Mark Carney earlier.

A short while ago it was trading close to $1.27.

It's still down half a cent from where it was before he started speaking.

However the pound has been trading in a range between $1.26 and $1.28 since mid-April.

Neil Wilson at ETX Capital says that is likely to be the case "until we get a clearer steer on what sort of trading arrangement Britain and the EU is to strike. That could be a long time coming".

US defence firms comfortable with the President

Chris Johnston

Business reporter, BBC News

You might recall yesterday Business Live brought you the news that Boeing chief executive Dennis Muilenburg thinks the aerospace and defence company has "a seat at the table" now that Donald Trump is in the White House.

Funnily enough the very same phrase was used today by John Harris, chief executive of Raytheon International, one of the biggest missile and radar systems makers in the US, when speaking to the BBC at the Paris air show.

He politely describes President Trump's methods as a "fresh approach to doing business". But given Mr Trump's desire to substantially increase defence spending, perhaps it is no surprise that companies like Raytheon aren't complaining about the administration - not yet at least.