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  1. Get in touch:
  2. Dow Jones closes down 4.15%
  3. Pound under $1.39
  4. Bank holds rates at 0.5%
  5. Debenhams cuts 320 jobs

Live Reporting

By Chris Johnston

All times stated are UK

Good night!

That's all we have time for on Business Live today - thanks for reading.

We're back bright and early at 06:00 tomorrow, so do join us then.

Twitter shares close 12% up

Twitter logo
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Let's get a quick update on Twitter shares now - they ended the day 12% ahead.

They had surged by more than 18% in early trade on the news that the company had reported its first quarterly net profit.

Volatility set to continue?

Trader in US
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Explaining the big falls Jonathan Corpina, senior managing partner with Meridian Equity Partners in New York said: "The dust hasn't settled yet, and I think both buyers and sellers are trying to figure out what this market really wants to do.

"I would think that this continues to happen for the next few trading sessions for everything to kind of get flushed out."

Dow and S&P 10% down on record highs

To put those fall on Wall Street into context both the benchmark S&P 500 and the Dow have fallen by more than 10% from the record highs they hit on 26 January.

On your bike


Female prisoners on a cycle mechanic training scheme launched by Halfords have gone on to work for the retailer after finishing their sentence, it has emerged.

The Halfords Academy was launched a year ago at HMP Drake Hall, Stafford, aimed at women inmates who wanted to train as bike mechanics. It followed a similar facility set up in 2015 at Onley Prison in Rugby, which has also seen offenders offered full-time jobs.

Halfords said two women had joined the company as cycle mechanics following their release, another two are due to start employment soon and others are expected to follow suit. The programme gives offenders the chance to recondition bikes, which are then donated to primary schools.

Jonathan Crookall of Halfords says: "It's about changing people's lives and giving them a second chance. We'd really encourage other businesses to consider supporting offender rehabilitation."

Big falls in Wall Street stocks

New York Stock Exchange sign
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The falls on Wall Street gathered pace towards the end of trading - with the Dow Jones seeing a big correction after gains earlier this week.

Dow Jones closed down 4.15% or 1,033.23 points to 23,860.12.

The S&P 500 fell 100.58 points or 3.75% to 2,581.

And the tech-heavy Nasdaq was down 3.9% or 274.82 points at 6,777.16.

To mix or not to mix, that is the question...

BBC World

BBC business producer Jonathan Josephs tweets a clip from today's edition of Talking Business with Aaron Heslehurst.

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Sterling stirs slightly

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It certainly has been a rollercoaster ride for sterling today. The pound is back above the $1.39 level to be up 0.3% at $1.3921.

900 jobs face the axe

Uncooked chicken

Nine hundred jobs are at risk at three poultry plants that 2 Sisters Food Group says are "loss-making".

The sites facing closure are Cambuslang in Scotland, with 450 jobs at risk, along with Smethwick and Wolverhampton in England, where 350 and 100 roles are at risk respectively.

Scot Walker, a Unite union representative at the Cambuslang plant, said staff were dismayed at news of the possible closure. "It is far too early to accept that this is the final word," he said.

Last year an investigation by the Guardian and ITV News found that workers at a 2 Sisters factory in West Bromwich had changed slaughter dates to extend the shelf life of meat.

Dow dips further

AmEx logo

The Dow Jones has fallen further in afternoon trading in New York to be down 2.3% or about 570 points, but the broader S&P 500 has shed just 1.5%, or 41 points.

Exxon Mobil is the sole riser of the 30 companies on the Dow, with American Express the biggest faller.

"The dust hasn't settled yet, and I think both buyers and sellers are trying to figure out what this market really wants to do," says Jonathan Corpina, senior managing partner at Meridian Equity Partners in New York.

"I would think that this continues to happen for the next few trading sessions for everything to kind of get flushed out."

Booker investor voices concern

Tesco store
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Could there be trouble ahead for Tesco? Activist investor Sandell Asset Management plans to oppose its £3.7bn takeover of Booker Group unless the wholesaler secures a better offer from Britain's biggest supermarket.

The New York based hedge fund it has a 1.75% in Booker and that it had conveyed concerns about the Tesco takeover to Booker's board.

Booker shareholders must approve Tesco's offer at a vote for it to proceed.

Oil down too

Oil pump
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Not to be left out, oil prices have also fallen to their lowest in six weeks today after data showed US output had hit record highs, while the North Sea's largest crude pipeline reopened following a lengthy outage.

US crude fell 1.2% to $61.07 a barrel, while Brent also dropped 1.2% to $64.72.

Flat out

The Bank of England reminds us today that UK productivity levels have been stubbornly flat for the best part of a decade in this handy chart:

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Bond jitters

US flag
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Some of the blame for the slide on Wall Street is being attributed to a fall in returns on Treasuries, or US government bonds, if you prefer.

Bond prices have weakened in recent days as investors prepared for the likelihood of a stronger US economy and higher inflation, which could lead the US Federal Reserve to raise interest rates more times than previously anticipated this year.

That has all kept equity investors nervous about higher rates and inflation. "Now we are having acute attention on what happens in the bond markets, so when yields move up there is an unsettling feeling in the equity market. Things haven't quietened down," said Jason Ware, chief investment officer and chief economist at Albion Financial Group.

"As rates rise, things, as far as equity investors are concerned, are getting worse," he added.

Sterling suffers

Oops: sterling has now erased almost all of its earlier gains against the dollar to be just 0.1% higher on the day at $1.3893 even.

Traders fear more losses

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While the London market had a reasonably bad day, and Wall Street looking set to close lower as well, it was worse on the continent: the Cac 40 in Paris and the Dax in Frankfurt tumbled about 2% and 2.6% respectively.

David Madden, a market analyst at CMC Markets UK, said: "Stocks are offside today as traders undo the positive move from yesterday. Investors remain unconvinced that panic has disappeared from the markets.

"The aftermath of a major decline usually leaves traders in limbo as they fear another leg lower is around the corner, and stocks are selling off."

The safe option?

Nobel prize-winning economist Paul Krugman comments on today's stock market falls:

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Wall Street falls

Getty Images

Wall Street is heading south again amid concerns that the US Federal Reserve could soon raise interest rates.

At lunchtime in New York the Dow Jones Industrial Average is down 460 points, or 1.8%, while the S&P 500 fell 1.6% and the Nasdaq Composite shed 1.8% as well.

Analysts said higher returns for US government bonds was the reason for Thursday's drop.

US markets have been under pressure all week due to worries the Fed may accelerate hike rates if inflation rises suddenly.

It may not be May...

Samuel Tombs, chief UK economist at Pantheon Macroeconomics, has been taking a close look at what the Bank of England's Monetary Policy Committee said today.

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Markets hit

Guardian economics correspondent Richard Partington tweets:

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FTSE falls again

After recovering from the losses earlier in the week on Wednesday, the FTSE 100 has headed south again to end the day 1.5% lower at 7,170 points.

A fall was to be expected to some degree, given that the earlier jump in sterling usually means a hit for London's blue-chip index. That because a stronger pound means lower profits for the many companies on the FTSE that make the bulk of their profits abroad.

However, it seems that London is following Wall Street lower, as the S&P 500 is down 1.2% and the Dow Jones Industrial Average has shed 1.3%

Japanese ambassador's Brexit fears

Japan's ambassador Koji Tsuruoka speaks after attending a meeting at Downing Street of major Japanese investors in the UK.

'High stakes'

Koji Tsuruoka
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Bosses from 19 Japanese companies, including the likes of Nissan and Toyota, met with prime minister Theresa May this afternoon in Downing Street.

After the meeting Japan's ambassador to the UK said that no firm would be able to keep operating in Britain if it is not profitable due to Brexit-related trade barriers.

"If there is no profitability of continuing operations in the UK - not Japanese only - then no private company can continue operations. So it is as simple as that," said Koji Tsuruoka (pictured) when asked about the threat posed by a failure to secure a post-Brexit free trade deal with Europe.

"This is all high stakes that all of us, I think, need to keep in mind."

Sterling falls back


That earlier rally, which sent sterling up 1.3% against the dollar, has lost much of its steam and is now only 0.8% higher at just under $1.40.

Start the week

Wall Street Journal Mike Bird makes a fair point about today's sterling rally:

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YouTube denies Russian influence in Brexit vote

YouTube logo

Perhaps no great surprise that YouTube has found no evidence of Russian sources using ads on its platform in a bid to interfere in the Brexit referendum.

Juniper Downs, YouTube's public policy chief, told a hearing of the Commons Digital, Culture, Media and Sport Committee that the company would be ready to help further investigations into possible Russian attempts to influence votes in the UK.

The committee was taking evidence from internet companies YouTube, Facebook, Google and Twitter in a session of its inquiry into fake news being held in Washington DC.

The cross-party panel of MPs was also using the trip across the Atlantic to meet senior senators who have been investigating allegations of Russian interference and collusion in US presidential election won by Donald Trump.

In three words or less...

Duncan Weldon, a former Newsnight economics correspondent who is now head of research at the Resolution Group, boils today's announcement from the Bank down to the very bare bones:

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Stock markets lose ground

US flag
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The market gyrations continue today, with the FTSE 100 now down about 1% at 7,211 points.

It's a similar story across the pond, with the the Dow Jones Industrial Average off about 0.74%, the S&P 500 has shed 0.5% and the Nasdaq Composite is down 0.4%.

"While volatility in the markets has eased over the last couple of days, it has remained at very high levels - probably a sign of the ongoing nervousness among investors which may leave markets vulnerable to further declines," said Craig Erlam at Oanda.

Sterling jumps

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Sterling has continued to climb higher in the wake of the Bank's soundings on interest rates, with the pound now back above $1.40 against the dollar, and close to €1.1440 against the euro.

The hand brake is half on...

Kamal Ahmed

Economics editor

Bank of England
Getty Images

Today the Bank signalled that the old conventions of increasing interest rates when inflation is above target would return.

The cost of mortgages is likely to rise and savers at last will see returns improve.

The economy is stronger, the Bank has made clear today - but not everything in the garden is rosy.

It points out that the UK economic engine still "remains restrained by Brexit-related uncertainty", which is "the most significant influence on the economic outlook".

We are driving along with the hand brake half-on.

Growth is modest by historic standards and the UK has gone from the fastest growing economy among the G7 largest global economies to the slowest.

Read more from Kamal here.

OBR 'was wrong'

BBC2's Daily Politics presenter Andrew Neil tweets:

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'Earlier and greater' - Watch Carney on the path of interest rates

Bank of England says interest rate moves will be 'somewhat earlier'

Are we heading for a May hike in interest rates?

Interest rate chart

Samuel Tombs, chief UK economist at Pantheon Macroeconomics reckons so.

He said: "The MPC has brought a May rate hike into play by stating that it thinks interest rates '…would need to be tightened somewhat earlier and by a somewhat greater extent' over the next three years than anticipated in November."

Ben Brettell, senior economist, Hargreaves Lansdown, agrees.

He said: "It now looks like the next rise could happen as soon as May – the next time the Bank’s economic forecasts are due to be updated."

Banks 'aren't fleecing customers'

The BBC's Szu Ping Chan at the Bank of England

Mark Carney

Many savers have not yet seen the returns on their accounts rise since the Bank increased interest rates to 0.5% from 0.25% last November. What does the Bank have to say?

Mr Carney says recent movements in savings and loan rate are similar to those seen in the past. He points out that the gap between what banks and building societies charge on their mortgages and the rate they pay to savers has actually narrowed in recent years.

Ben Broadbent, deputy governor, says: "It's not the case that banks are fleecing their customers relative to the past. Deposit rates have gone up a little bit," while he says mortgage rates haven't for many people who have fixed deals.

Mr Carney says higher investment and the end of austerity in several advanced economies will help to boost growth, which might see interest rates rising gradually around the world. With that, the news conference ends.

Carney: Market turbulence not surprising

The BBC's Szu Ping Chan at the Bank of England

How has the recent financial turbulence affected policymaking?

Mr Carney says he will not deliver a "running commentary on financial markets"

He recognises that recent volatility in markets had been "extremely low", so much so that he believes that "at some point there would be an adjustment".

"It's not an entirely surprising development," he says.

However, reforms after the financial crisis mean big sell-offs don't matter as much as they used to. He says it's "incredibly important to recognise we feel strongly that the core system is entirely different to the past," so big stock market falls don't result in a big hit to households and businesses.

Carney: Productivity disappointing

The BBC's Szu Ping Chan at the Bank of England

Why is the Bank so gloomy on the outlook for growth and living standards given that the most recent figures show productivity has picked up?

Mr Carney says productivity growth has disappointed for a while, which has resulted in downgrades to its medium-term outlook.

Ben Broadbent, the Bank's deputy governor for monetary policy, says there are reasons to believe that the recent strength may not be sustained. While policymakers "remain hopeful" that it will pick up, he says the Bank would not rip up its forecasts after one data release.

Carney: Investment has been weak

The BBC's Szu Ping Chan at the Bank of England

Mr Carney is asked why, given weaker growth than seen in the past, sluggish household spending and the recent financial market turbulence, are interest rate rises even on the cards?

He says that investment has been weak, which has fed into the "modest" growth in productivity - a key ingredient for rising living standards and stronger growth over the medium term.

He says: "That means the economy cannot grow as fast as it used to without generating inflationary pressures... and we have to deal with the consequences of that. The speed limit of the economy has changed."

As a result, the Bank is likely to have to raise interest rates to prevent it from overheating, even if growth does remain subdued relative to historic rates.

He highlights that growth is not debt-fuelled and the economy is expected to be supported by stronger pay growth in the coming years.

He says the interest rate rise in November last year has pushed up mortgage costs for those on variable rates, but adds that 60% of outstanding mortgages are now tied to fixed rates, which also cushions the impact of rate rises for households.

"We have been providing a significant amount of support to this economy during a very difficult period," he says, which has ensured the economy remains robust and the jobs market remains strong.

However, he adds there are limits to the Bank's powers.

"The most important decisions by orders of magnitude for the years to come are not going to be taken in Threadneedle Street," he says, but elsewhere, as part of the Brexit negotiations.

Carney: Households feeling the pinch

The BBC's Szu Ping Chan at the Bank of England

Bank of England

Kamal Ahmed, the BBC's economics editor, asks the governor to elaborate on the overarching message of the latest Inflation Report.

Is it a warning to British households that they can expect interest rates to rise at a faster pace than before? He also asks Mr Carney's opinion on the government's Brexit impact assessments.

Mr Carney says that in order to return inflation to the 2% target in an economy that could be at risk of overheating, it may be necessary to raise interest rates.

He stresses that any increases will be limited and gradual, but more than it expected in November if growth remains steady. Back then, they said interest rates could rise to around 1% by the end of the decade, up from 0.5% today.

"The message is not that rates will rise rapidly," he stresses again. But instead that they could rise "somewhat sooner and a to somewhat greater extent".

On the impact assessments, the governor stresses that the Bank was not involved in compiling them.

He says that the Bank does take into consideration how households have responded to developments in negotiations and the vote.

For households, they are mainly feeling the pinch from the squeeze on real incomes, while there has been a "notable" impact on investment on businesses, which has picked up, but not to the extent to which you might expect, given the strength of the global economy.

No hands tied

The BBC's Economics Editor tweets...