News updates from May 10: US says Israel’s use of its arms may have violated humanitarian law; Jim Simons dies

Shares in electric vehicle maker Zeekr Intelligent Technologies jumped by more than one-third on their New York debut on Friday in the biggest US listing by a Chinese company in almost three years.

Zeekr, controlled by Volvo owner Geely, sold shares worth $441mn in an initial public offering, two-thirds of which was bought by Geely units and existing investors. Demand for the shares not already spoken for allowed Zeekr to increase its deal from $367mn and to price at $21, the top of its range.

The company’s New York Stock Exchange-listed shares closed 34.6 per cent higher to $28.26. On average, IPOs of roughly this size have risen 29 per cent on their debut this year, according to Dealogic data.

A flood of Chinese companies seeking funds from US listings was abruptly cut off in 2021 after ride-hailing group DiDi floated amid investor acclaim, only to suffer a harsh Chinese regulatory crackdown within days.

Wall Street blue-chips have managed their first three-week positive run higher in three months, while the S&P 500 made minor gains on Friday after consumer data suggested a weakening mood with renewed fears over inflation.

The S&P 500 closed 0.2 per cent higher, up 1.9 per cent this week, while the tech-heavy Nasdaq Composite ended flat for a rise of 1.1 per cent since Monday morning.

An early upbeat mood was dented after figures from the University of Michigan’s preliminary May survey showed overall sentiment at a six-month low, but at a six-month high for expected inflation, prompting some worry about the potential for stagflation.

Yields on interest-rate sensitive two-year Treasuries rose to 4.87 per cent in response, up 0.06 percentage points on the day.

Wall Street stocks struggled to make headway on Friday as a sentiment survey suggested consumers’ mood was weakening while inflation expectations were rising. 

The S&P 500 and the tech-heavy Nasdaq Composite were both broadly flat by mid-afternoon in New York, although still on course for their first three-week run of gains in three months. 

Data from the University of Michigan’s preliminary May sentiment report showed overall sentiment at a six-month low, but a six-month high for expected inflation, prompting concerns about the potential for stagflation.  

Yields on interest-rate sensitive two-year Treasuries rose to 4.86 per cent in response, up 0.07 percentage points on the day. 

UK and European stocks closed again closed at record highs, with the former helped by signs of green shoots in the British economy.

London’s FTSE 100 closed 0.6 per cent higher on Friday, helped by data showing that the UK has recovered from a technical recession, as the economy expanded by 0.6 per cent in the first quarter.

The region-wide Stoxx 600 ended trading 0.8 per cent higher, extending a run this week that has been spurred by rising expectations the European Central Bank could soon cut interest rates as well as stronger than expected earnings for financial services companies.

Germany’s Dax rose 0.5 per cent, France’s Cac 40 added 0.4 per cent.

Jim Simons, the billionaire founder of hedge fund Renaissance Technologies, has died, aged 86.

A trained mathematician, Simons worked as a Cold War codebreaker for the National Security Agency during the mid-1960s, before shifting to Stony Brook University later in the decade where he chaired the maths department at the New York-based school.

Leaning on his mathematical expertise, Simons in 1978 founded what would go on to become Renaissance Technologies, which pioneered quantitative trading strategies.

Simons stepped back from his role as co-chair of the fund in early 2021 and from his family’s Simons Foundation, which sponsors research in mathematics and the basic sciences.

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US stocks rose slightly in early trading on Friday, putting them on track to notch a third straight week of gains for the first time since February, as traders looked ahead to potential interest rate cuts.

Wall Street’s benchmark S&P 500 gained 0.3 per cent and edged closer to an all-time high shortly after the New York opening bell, with financials and industrials among the best-performing stocks. The tech-dominated Nasdaq Composite also rose 0.3 per cent.

In a quiet week for major economic news, US investors will turn their gaze to the latest consumer price index reading, due next week, to gauge whether the Fed will move towards a more dovish position in pursuit of its 2 per cent inflation target. 

A measure of US consumer sentiment has unexpectedly fallen to its lowest level since November as more Americans expect inflation, unemployment and interest rates to become “unfavourable” in the year ahead. 

The University of Michigan’s consumer sentiment index registered a preliminary reading of 67.4 in May, its lowest since November, falling far short of the 76 expected by economists and April’s reading of 77.2.  

“While consumers had been reserving judgment for the past few months, they now perceive negative developments on a number of dimensions,” said Joanne Hsu, University of Michigan’s survey of consumers director. 

Inflation expectations for the year ahead rose from 3.2 per cent last month to 3.5 per cent.

Everton Football Club’s suitor 777 Partners has called in turnaround and crisis management experts, as the investment firm wrestles with accusations of fraud and the unravelling of the reinsurance financing that underpinned many of its acquisitions.

The Miami-based group has appointed a team from B Riley Advisory Services to assist with “various operational challenges”, according to a 777 memo reviewed by the Financial Times. “We have retained a team of professionals from B Riley Advisory Services (a division of B Riley Financial) to assist with managing through various operational challenges,” the memo said.

It added that 777 is working to “rationalise” the business and “select the most profitable path forward for our investments”.

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European Central Bank policymakers believed they were close to cutting interest rates when they met last month, but most thought they should wait to see if escalating geopolitical tensions could cause a fresh surge in inflation.

Rate-setters thought it was “plausible” they would be “in a position to start easing monetary policy restriction at their June 6 meeting” if data continued to show inflation falling, according to the minutes of last month’s meeting.

There were “a few” members of the governing council who argued in favour of cutting rates at last month’s meeting, citing the risk of inflation “undershooting” the bank’s 2 per cent target. 

But most wanted to wait until June for “further evidence” of whether the disinflation process would continue or be derailed by “a possible escalation of geopolitical tensions”.

Russian forces launched an armoured attack on Ukraine’s northern Kharkiv region on Friday as Moscow seeks to take advantage of its superior weaponry and manpower before the arrival of US military aid.

The defence ministry in Kyiv said Russian armoured units attempted to break through Ukrainian defensive lines in the early morning after conducting artillery and air strikes around the city of Vovchansk.

“As of now, these attacks have been repelled; battles of varying intensity continue,” the ministry said on X. “Reserve units have been deployed to strengthen the defence in this area of the front. The Defense Forces of Ukraine continue to hold back the enemy’s offensive.”

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Jaguar Land Rover posted its biggest profit in nine years as global demand surged for its luxury vehicles, led by the Range Rover and Defender brands. 

Sales of the company’s Range Rover SV more than doubled, with 4,099 units sold in its fiscal year of 2024. Revenues for the 12 months to March were £29.0bn — JLR’s highest-ever full-year revenue and up 27 per cent compared with the year before.

Pre-tax profit hit £2.2bn in the full year, the highest since 2015. This comes after a difficult post-pandemic period for the company, with heavy losses due to production issues and chip shortages.

European stocks were marching upwards in early afternoon trading on Friday as strong earnings pushed indices to fresh highs.

The region-wide Stoxx 600 gained 0.8 per cent in early afternoon trading on Friday, while France’s Cac 40 added 0.7 per cent and Germany’s Dax climbed 0.5 per cent.

In a note to clients, Barclays said that companies’ tone on outlook had improved. “This has translated into better earnings momentum,” it said. 

London’s FTSE 100 continued to hit record highs, up 0.7 per cent. This followed data showing that the UK had rebounded slightly from a technical recession, with the economy growing by 0.6 per cent in the first quarter. 

Shares in Novavax more than doubled in pre-market trading on Friday after the struggling US maker of Covid-19 vaccines struck a licensing deal worth up to $1.2bn with Sanofi, one of the world’s largest vaccine makers by sales.

Under the deal, Sanofi will commercialise Novavax’s coronavirus jab and use its technology to develop its own combined shot with flu.

Novavax’s US-listed shares were trading at $10.31 before the New York open, a rise of more than 130 per cent, giving it a market value of about $1.4bn. Sanofi’s Paris-listed shares were up 0.6 per cent, with a market value of about €118bn.

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A long-awaited approval decision on Moderna’s second commercial product after its Covid-19 jab has been delayed by several weeks, the US biotech said on Friday. 

The US Food and Drug Administration originally planned to have concluded the approval decision for Moderna’s respiratory syncytial virus vaccine by May 12 but the decision has been delayed to the end of the month. 

Moderna is also awaiting a decision from the Centers for Disease Control and Prevention’s vaccine advisory committee later this month, which is key to guarantee the widespread distribution of the jab.

Tesla lost ground to local electric vehicle brands in April, latest data showed, as the US company grapples with heated competition and waits for full approval to sell its self-driving software in the world’s largest EV market.

Tesla’s market share in China dropped 2.6 percentage points from a year earlier to 4 per cent in April, according to the China Passenger Car Association.

The EV maker’s April sales volume in China declined 21 per cent year on year to 31,421 units, compared with a 28 per cent rise in the country’s overall EV sales.

US consumer sentiment: The University of Michigan’s consumer sentiment index is forecast to report a preliminary reading of 76 in May, down from 77.2 in April.

Fedspeak: Federal Reserve governor Michelle Bowman will deliver a speech about financial stability risks before the Texas Bankers Association Annual Convention. Chicago Fed president Austan Goolsbee will participate in a question-and-answer-session at the Economic Club of Minnesota.

Canada employment: The economy is forecast to have added 18,000 jobs last month, up from a loss of 2,200 jobs in March. The unemployment rate is expected to have ticked up to 6.2 per cent.

Big share price moves in Europe today include Italian transport manufacturer Iveco Group, Swedish medical tech company Getinge, and British real estate portal Rightmove:

• Iveco Group: Shares in the Italian truck and bus maker advanced 6.8 per cent after it reported strong results for the first quarter of 2024, beating analysts’ expectations. Adjusted net income doubled compared with the same quarter last year, rising to €153mn. 

• Getinge: The Swedish medical technology company opened 8.7 per cent down this morning in its first trading session since the US Food and Drug Administration urged providers to move away from the company’s heart devices following a string of recalls for safety and quality concerns. 

• Rightmove: Shares in the UK housing portal slipped 5 per cent after it cut its forecast for average revenue per advertiser from £100-£110 to £75-£85. Rightmove nevertheless provided a positive outlook for the UK property market and left its revenue and profit guidance unchanged.

Chancellor of the exchequer Jeremy Hunt said the UK’s above-expected GDP growth of 0.6 per cent was “encouraging” and showed the government needed to stick with its policies. 

He told Sky News that Friday’s growth figures, alongside the Bank of England’s improved outlook for inflation issued on Thursday, would mean that “for families who’s been having a really tough time, this is an indication that difficult decisions that we’ve taken over recent years are beginning to pay off and we need to stick with them”.

London’s main bourse hit fresh highs on Friday after data showed the UK economy expanded 0.6 per cent in the first quarter, surprising economists and denting the case for an interest rate cut in June.

The FTSE 100 added 0.5 per cent in early trading on Friday, rising to a record high. The mid-cap FTSE 250 gained 0.3 per cent.

Sterling strengthened 0.1 per cent against the dollar to $1.2535 after Office for National Statistics figures showed the UK economy grew at a faster pace than the US and Eurozone in the first three months of the year. 

European stocks also rose, with the region-wide Stoxx 600 up 0.5 per cent. France’s Cac 40 added 0.4 per cent as did Germany’s Dax.

Banco Sabadell has accused its rival BBVA of breaking Spanish takeover law in an escalation of tensions between the two banks at the centre of a deal battle.

Sabadell, the target of a hostile takeover bid by BBVA, filed a statement with regulators on Thursday saying the larger bank “violated” takeover law by providing “incomplete data” in a call with analysts earlier in the day.

On Monday, Sabadell rebuffed a friendly approach from BBVA, which responded by going hostile and pitching the same bid directly to Sabadell shareholders. It originally valued the Catalan bank at €12bn.

Winter holidaymakers flying to the Caribbean and a recovery in business travel helped British Airways owner International Airlines Group report a rise in first-quarter profit as it forecast another strong summer for the airline industry.

The company, which also owns airlines including Spain’s Iberia and Ireland’s Aer Lingus, reported operating profit before exceptional items of €68mn in the first three months of the year, beating analysts’ expectations and up from €9mn a year earlier.

IAG said it had increased flights to “the strongly growing” Latin America and Caribbean region as leisure travel demand “remains strong”, and noted that corporate travel “continues to recover”.

“We are well-positioned for the summer. The high demand for travel is a continuing trend,” said chief executive Luis Gallego.

The UK economy has exited last year’s technical recession with above expectations growth of 0.6 per cent for the first quarter, providing welcome economic news for Rishi Sunak ahead of the election expected this year.

Friday’s Office for National Statistics figure for quarter-on-quarter growth compared with the 0.4 per cent forecast by both the Bank of England and economists polled by Reuters. 

It also marked a recovery from the technical recession of the second half of 2023, when output fell for two consecutive quarters.

The figure is set to be welcomed by Sunak, who has made economic growth a signature pledge. The prime minister’s Conservatives trail Labour by roughly 20 points in opinion polls.

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The founder of Hin Leong Trading has been convicted of cheating HSBC and abetting forgery after a lengthy trial in Singapore, drawing a line under an oil dealing scandal that left banks facing hundreds of millions of dollars in potential losses.

Lim Oon Kuin was found guilty of three charges involving a total of $111.7mn which included two for cheating HSBC and another for instigating a Hin Leong employee to forge a false document. 

The 82-year-old was one of Singapore’s wealthiest businessmen before his empire collapsed in 2020 as oil prices tumbled. He was first charged in 2020 after confessing to hiding $800mn in losses at the oil trading firm he founded.

Hong Kong equities extended a weekslong rally on Friday, with the city’s benchmark Hang Seng index surging 2.4 per cent.

The Hang Seng Mainland Properties index, which includes large Chinese developers, rose 3.9 per cent. On Thursday, the Chinese cities of Hangzhou and Xi’an scrapped restrictions on buying properties that had been put in place to deter speculation.

Futures for Brent crude, the global benchmark, edged up 0.7 per cent to $84.44 per barrel amid heightened tension in the Middle East after Israel struck a defiant tone over US objections to an invasion of Rafah.

Eurozone economy: The European Central Bank will publish the minutes of its latest monetary policy meeting which took place in April. At the time, the ECB sent a strong signal that it could consider rate cuts at its next meeting in June.

UK: The Office for National Statistics will release its latest figures on UK GDP. Economists polled by Reuters expect the economy to have grown by 0.1 per cent in March.

International Airlines Group: The London-listed owner of British Airways will report results for the first quarter of the year; its shares are up by 17 per cent in the year to date.

Hong Kong equities rose on Friday, with the city’s bourse operator leading gains after the announcement of a plan to create a Hong Kong-themed exchange traded fund in Saudi Arabia.

Hong Kong’s financial secretary Paul Chan on Thursday said the city was working on an ETF tracking Hong Kong equities that would be listed on Riyadh’s Tadawul stock exchange.

Hong Kong’s benchmark Hang Seng index rose 1.4 per cent on Friday. Shares in Hong Kong Exchanges and Clearing, the company that runs the city’s stock exchange, rose as much as 8.2 per cent.

The Oversea-Chinese Banking Corporation, Singapore’s second-largest lender, has made an offer to fully acquire its life insurance subsidiary Great Eastern Holdings.

OCBC said on Friday it had made an unconditional S$1.4bn (US$1bn) offer to buy the rest of Great Eastern’s shares at a 37 per cent premium.

The company said the take-private offer was “in line with OCBC’s strategy to solidify its wealth management leadership position to drive growth by capturing rising Asian wealth”.

OCBC on Friday reported first-quarter net income of S$2bn, a new quarterly record and a 5 per cent increase from the previous year. Shares rose 1.8 per cent after the report.

Events: Iran holds run-off parliamentary elections. Indonesian markets are closed for the ascension of Jesus Christ holiday.

Economic data: Japan publishes its current account balance for March, while Malaysia and India have industrial production data for the same month.

Earnings: India’s Tata Motors, Japan’s Honda Motor, Tokyo Electron and Singaporean bank OCBC report results.

The S&P 500 climbed to its highest level in a month as traders had higher hopes for rate cuts after the publication of soft labour market data.

The benchmark index rose 0.5 per cent on Thursday, its highest since April 1, as 82 per cent of its participants rose in the session. The tech-heavy Nasdaq Composite advanced 0.3 per cent as four “Magnificent Seven” stocks made gains. Tesla and Nvidia notched three-day losing streaks.

The small cap-focused Russell 2000 also finished at its highest level in a month after closing 0.9 per cent higher.

The advance mirrored moves on the other side of the Atlantic, where stocks in the UK and Europe rose as the Bank of England stirred hopes it could loosen monetary policy this summer if inflation stays low.

BP is interested in acquiring available Tesla supercharger sites in the US following Elon Musk’s decision to scale back growth of the electric-vehicle maker’s charging network.

“We are aggressively looking to acquire real estate to scale our network, which is a heightened focus following the recent Tesla announcement,” BP said in a statement.

BP Pulse, the company’s EV charging division, plans to work with real estate owners with potential Tesla supercharger development deals to secure available sites to meet its expansion goals. Last week Tesla laid off most of its supercharger division in response to falling revenues at the EV company.

BP’s interest in Tesla supercharger sites was first reported by Bloomberg.

BP has committed to invest $1bn in the US’s EV charging infrastructure by 2030, with $500mn of that in the next two to three years to deliver 3,000 charge points.

Tesla operates more than 57,000 superchargers at more than 6,200 locations globally.

Shares in Roblox, one of the biggest video game developers in the world, plunged more than one-fifth after the company issued a weaker than expected revenue and bookings outlook this quarter, in a further sign of the slowdown afflicting the industry.

Roblox, which had a market capitalisation of $25bn at Wednesday’s close, is best known for its eponymous platform that allows users to create and play their own games. Player spending on in-game transactions has come under pressure in a challenging consumer environment.

Shares were down about 22 per cent in Thursday afternoon trading after its projected ranges for bookings of $870mn to $900mn and revenue between $855mn and $880mn in the current quarter undershot analysts’ forecasts.

The UK government has under the National Security and Investment Act cleared the planned merger between telecoms operators CK Hutchison-owned Three UK and Vodafone’s domestic business with conditions.

The Cabinet Office in a “final order” said the secretary of state had approved the proposal subject to conditions, including the establishment of a national security committee within the combined entity to “oversee sensitive work”.

The UK competition watchdog last month formally referred the planned tie-up to a more in-depth investigation.

The companies in a joint statement said they were “pleased” the proposal had been approved by the government and were “continuing to engage collaboratively with the Competition and Markets Authority” on its ongoing review.