News updates from April 9: OpenAI and Meta ready new AI models; EU launches probe into Chinese wind turbine companies

Shares in several big North America-based gold miners continue to play catch-up as the price of the yellow metal remained on course for its third record closing high in a row.

The likes of US-listed Newmont and Canada-listed Barrick Gold recovered on Tuesday, after slipping a session earlier even as the gold price rose. In Newmont’s case, its drop on Monday ended a nine-session winning streak.

The divergence has not been uncommon this year, with some of the sector’s biggest stocks underperforming gold.

An advance for gold on Tuesday would mark the 44th session this year it has closed higher, equating to a gain in about 63 per cent of sessions in 2024, as well as its 16th record close.

Of the selected miners, none have had gains in more than about 55 per cent of trading days this year, and none are at record highs.

US stocks recovered from losses earlier in the session to close higher on the eve of the release of closely watched inflation data.

The S&P 500 added 0.1 per cent on Tuesday, with biotech group Moderna the best performing stock, up 6.2 per cent. Real estate and utilities were the best performing sectors on the day. The tech-dominated Nasdaq Composite closed 0.3 per cent higher.

In fixed income markets, yields on US Treasuries fell as prices rose. The yield on benchmark 10-year Treasuries slipped 0.06 per cent to 4.36 per cent.

In commodity markets, oil prices fell back from recent highs, with Brent crude, the international oil benchmark, down 0.1 per cent at $89.50 per barrel.

The Nobel Prize-winning particle physicist Professor Peter Higgs, whose prediction of the Higgs boson helped revolutionise understanding of the universe, has died aged 94.

Higgs, who died peacefully at home on Monday, saw the groundbreaking theoretical work he and others did in the 1960s triumphantly confirmed by experiments at the Cern particle accelerator almost half a century later.

The detection of the Higgs boson in 2012 at Cern, the European Organization for Nuclear Research near Geneva, completed the so-called Standard Model of particle physics. It confirmed the existence of a fundamental field that, as Higgs had postulated, filled the universe and gave mass to the stars, planets and life within.

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Venezuela’s former oil minister Tareck El Aissami, once a powerful confidante of authoritarian President Nicolás Maduro, has been arrested on corruption allegations, the socialist government announced on Tuesday.

Former finance minister Simón Zerpa and Sarmark López, a businessman and associate of El Aissami, were also arrested as part of the probe into corruption at state oil major Petróleos de Venezuela, a critical source of government revenue.

Attorney-general Tarek William Saab on Tuesday said El Aissami and his co-conspirators were involved in an illegal scheme to directly manage shipments of crude in avoidance of US sanctions, without sending the payments through the country’s central bank. Doing so also allowed them to speculate on currency markets, Saab said.

US stocks slipped in afternoon trading in New York as investors geared up for a closely watched inflation report out on Wednesday.

The benchmark S&P 500 stood 0.4 per cent lower, with financials and industrials the worst performing sectors. Real estate stocks, in contrast, notched solid gains. The tech-dominated Nasdaq Composite fell 0.2 per cent, with index heavyweight Nvidia down 3.3 per cent. 

The moves came ahead of Wednesday’s release of consumer price inflation data, which will probably influence investor forecasts for the number of interest rate cuts this year.

The headline inflation number from the Bureau of Labor Statistics is forecast to be 3.5 per cent for March, up from a rate of 3.2 per cent the previous month, according to a Bloomberg poll of economists.

Arizona’s highest court has upheld a 160-year-old law banning nearly all abortions, a radical move in a critical swing state that could decide who wins the White House in November.

The state supreme court on Tuesday ruled that an 1864 ban on all abortions, except those aimed at saving a woman’s life, is now enforceable. The law does not include exceptions for women’s health, or for victims of rape or incest. It carries a penalty of up to five years in prison for providers.

“Physicians are now on notice that all abortions, except those necessary to save a woman’s life, are illegal,” wrote the justices, who voted 4-2 to revive a law that was written before Arizona was a state and women could vote. The state had previously banned abortions beyond 15 weeks of pregnancy.

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Petitions to form unions in the US are on course to reach historic levels this year, according to federal data, as the labour movement seeks to capitalise on the success of last year’s high-profile strikes to add new members.

The National Labour Relations Board on Tuesday said petitions for union representation elections continue to “surge”, and increased 35 per cent from a year ago to 1,618 in the first half of fiscal year 2024, which runs from October 1 to March 31.

That puts 2024 on track to reach historic levels: the 2,115 petitions filed in fiscal year 2023 was the second-highest over the past decade, behind 2015, according to NLRB data going back to 2014.

Labour organisers have said they plan to recruit new members in traditionally non-union workplaces including banks and pharmacies.

Shares of Boeing slipped 1.9 per cent after the aircraft maker reported its lowest quarterly deliveries since 2021.

Boeing, which has been in turmoil since a door panel blew out of one its 737 Max jets in January, delivered 83 planes in the first quarter, compared with 157 in the prior quarter. Airbus, its main competitor, delivered 142 planes in the period.

The decline in its share price also came after a New York Times report said the US aviation regulator was investigating whistleblower claims about safety issues in the production of Boeing’s 787 Dreamliner plane. The company said the claims were “inaccurate”.

“Voluntary reporting without fear of reprisal is a critical component in aviation safety,” the Federal Aviation Administration told the Financial Times. “We thoroughly investigate all reports.”

Rupert Murdoch’s UK newspaper empire incurred fresh costs of more than £51mn related to claims made in the phone-hacking scandal against the Sun and now defunct News of the World, according to its most recent annual accounts.

The costs from ongoing court action against the group — which is still facing claims from Prince Harry as well as celebrities such as Hugh Grant — fell from £128mn the year before when it was forced to book additional provisions in its accounts.

News UK has now paid out about £1bn in settlements and legal costs since the scandal broke more than a decade ago. The group has admitted phone hacking to procure stories took place at News of the World — leading to the newspaper’s closure, a public inquiry and a police investigation — but not at the Sun.

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Marco Dunand, head of Swiss energy trader Mercuria Energy, has indicated that Nick O’Kane, the former star trader at Macquarie, will take on a senior job at the company to help its “overstretched” management rethink how the business operates and manages risk.

It was a “good thing to bring someone from outside to take a look at how we run the company and maybe come with different ideas, and with a certain level of seniority,” Dunand said at the FT’s Global Commodities conference.

“Our trading business is a very complex machine … it requires constant work to be done to make sure you stay on top of your risk and everything.”

The company is also set to hire Steve Hill, the former head of liquefied natural gas, natural gas and power trading at Shell.

“We do trade LNG, but more from a financial perspective, and we wanted to grow on the physical side of things,” Dunand said.

Stocks fell and government bonds rallied in Europe as traders await further signals on the pathway for interest rates ahead of the European Central Bank’s policy meeting on Thursday. 

The region-wide Stoxx Europe slipped 0.6 per cent, pulled lower by steep declines for industrial groups and financials. 

Germany’s Dax fell 1.3 per cent, France’s Cac 40 dropped 0.9 per cent, and London’s FTSE 100 slipped 0.2 per cent. 

Yields on 10-year German Bunds — a benchmark for the eurozone — fell 0.07 percentage points to 2.37 per cent. Yields move inversely to prices.

The green transition and artificial intelligence boom risk creating a “real problem” for the supply of critical commodities such as copper, aluminium and zinc as demand rises, warned Trafigura chief Jeremy Weir.

The twin shifts will increase the consumption of metals sharply, Weir said at the FT’s Global Commodities conference on Tuesday. “You are either not going to supply the metals or there’s going to be a price incentive to allow the production to ultimately take place,” he said.

Weir said the price of critical minerals has started to rise, and saw future shortfalls in copper, which is used in electrification; aluminium, which features heavily in green technologies; and zinc, which is used to make steel used in wind turbines.

Wall Street stocks and US Treasuries rallied as traders awaited a key inflation reading on Wednesday from the US Department of Labor for further insights into the pathway for interest rate cuts from the Federal Reserve. 

The S&P 500 was 0.3 per cent higher shortly after the opening bell in New York, pulled higher by gains for technology stocks and rate-sensitive real estate groups. The tech-heavy Nasdaq Composite climbed 0.5 per cent.

Yields on benchmark 10-year Treasuries fell 0.04 percentage points to 4.38 per cent, partially reversing an increase from the previous session. Yields move inversely to prices. 

Gunvor co-founder Torbjörn Törnqvist said the picture for oil was “quite” constructive and the market was better balanced than most people forecast two months ago.

“We are coming into the prime season for demand and Opec is doing a great job, holding back just enough oil to keep this market tight. But [there] is spare capacity [that] can be released at any time,” the chair of the commodities trading house said at the FT Global Commodities conference.

He added current prices at about $90 a barrel were fair given supply and demand dynamics and geopolitical tensions. “$90 is a good price for a producer. Oil companies make more money today at $90 than they did 10 years ago, when it comes to the long term.”

Brussels has launched a subsidy investigation into Chinese wind turbine companies as it steps up efforts to protect its domestic industry from cheap competition.

Margrethe Vestager, the European commissioner in charge of competition policy, said regulators were looking at “the conditions for the development of wind parks in Spain, Greece, France, Romania and Bulgaria”.

Officials said they believed Chinese companies participating in the wind parks may have received subsidies from Beijing.  

The investigation will use new legislative powers designed to clamp down on market-distorting subsidies by foreign governments as Brussels seeks to defend itself from unfair competition coming from abroad, including Beijing.

UK government officials deterred ministers from engaging with sub-postmasters in the Post Office Horizon scandal, according to a lead campaigner.

Alan Bates, a former sub-postmaster, told a public inquiry that he held the civil service “to blame” after meetings with ministers failed to yield action in the decades-long saga. 

Bates met Ed Davey, leader of the Liberal Democrats, when he was postal affairs minister in the 2010 coalition government. Davey had been briefed by officials to meet for “presentational reasons” but to “avoid any commitment”.

“I hold the officials far more guilty in all of this than politicians,” he said. “They were briefing them in the direction they wanted . . . not what was for the benefit of the group or the individual here.” 

Simon Harris has been elected as Ireland’s youngest Taoiseach, taking the helm of the coalition government less than a year before a general election.

Harris, 37, who replaces Leo Varadkar, won Tuesday’s vote in the Irish parliament, the Dáil, by 88 to 69.

The centre-right Fine Gael party’s leader — dubbed the “TikTok Taoiseach” because of his social media savvy — will be formally appointed by President Michael D Higgins and will reshuffle the cabinet later.

Harris has promised to “hit the ground running”, massively increase homebuilding, offer tax breaks for middle-income earners and help for small businesses. He faces local and European elections on June 7 and a general election by March 2025.

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The lead campaigner in the UK Post Office Horizon scandal was dismissed after he became “unmanageable”, according to an internal Post Office memo published on Tuesday.

Alan Bates, a former sub-postmaster, was removed from his post in 2003 after he refused to make up accounting shortfalls he alleged at the time had been generated by the Post Office’s Horizon IT system.

Internal Post Office slides noted that Bates was “dismissed because he became unmanageable. Clearly struggled with the accounting and despite copious support did not follow instructions”.

More than 900 sub-postmasters were convicted in cases involving data from Fujitsu’s faulty Horizon IT system following its introduction in 1999. Thousands more were pursued for account shortfalls.

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An oil price range of $80 to $100 per barrel “feels like a sensible range”, the chief executive of Dutch oil trading company Vitol told the FT’s Commodities Summit on Tuesday, as global oil prices traded at five-month highs.

“It’s really a supply constrained market,” said Russell Hardy, pointing to the supply cuts that members of the Opec+ oil cartel have undertaken since 2022. His comments come as Brent crude trades at about $90 a barrel, up around 15 per cent this year.

Hardy added that he expected oil demand in China to peak “fairly soon” but that “there’s still a little bit of consumer growth there that we’d expect to take the [oil demand] numbers a little bit higher”.

Europe’s top human rights court has dismissed a landmark case brought by six Portuguese young people against 32 European governments for failing to cut greenhouse gas emissions but said in a separate ruling that climate change could still be considered a threat to human rights, setting a benchmark for future litigation on climate change. 

The judges deemed that the Portuguese group had not exhausted legal action through national courts before bringing their case to Strasbourg.

However, in another case against the Swiss government that went before the European Court of Human Rights on Tuesday, the judges ruled that because climate change was a “common concern to humankind”, citizen groups should be able to take legal steps against governments that failed to act.

The UK Post Office Horizon inquiry will push ahead with several months of evidence despite being beset by the late disclosure of documents. 

Sir Wyn Williams, chair of the public inquiry, said witnesses would be recalled if required after it emerged that tens of thousands of documents had been disclosed late by the Post Office in recent months. 

“I am unshakeable in my belief that this inquiry should not last a day longer than is strictly necessary,” Williams said. 

The public inquiry into one of the widest miscarriages of justice in modern British history began its penultimate phase of hearings on Tuesday.

The valuation gap between US and European oil groups is a “major issue” making it more likely that companies will consider moving their listings to New York, said former Shell chief executive Ben van Beurden.

In his first public interview since leaving Shell in 2022, van Beurden told the FT Global Commodities summit that when the company ended its dual listing and moved its headquarters to London, a listing in New York was seen as a “bridge too far”.

But he now believed Shell was “massively undervalued”. Deeper capital pools in the US and more favourable attitudes towards conventional energy companies in the US made European listings less attractive and this would “increasingly” be a problem, he said.

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Big share moves in Europe this morning include French medical diagnostics company BioMérieux, Polish miner Polska Miedz and Italian hearing-aid supplier Amplifon:

• BioMérieux: the French company’s shares led risers in the Stoxx Europe 600 index, up 8.6 per cent after strong first-quarter sales and following release of its latest strategic plan.

• Polska Miedz: shares in the copper miner and producer of precious and other non-ferrous metals rose 4.6 per cent in early trading, joining other miners in a sector-wide rally driven by rising metals prices.

• Amplifon: shares in the Italian hearing care company led fallers in the Stoxx Europe 600, down 5.6 per cent after Italy’s antitrust regulator said the market for hearing aids lacked transparency on pricing and services.

Europe must prepare for potential war, with a full-scale conflict on the continent “no longer a fantasy”, the EU’s chief diplomat has warned. 

“War is certainly looming around us,” said Josep Borrell, the EU’s high representative for foreign and security affairs. “A high-intensity, conventional war in Europe is no longer a fantasy.

“Russia threatens Europe,” Borrell said in a speech to foreign diplomats and officials in Brussels, through its war in Ukraine and through hybrid attacks on EU member states.

European equities slipped in early trading on Tuesday, pulled lower by declines for rate-sensitive real estate stocks.

The region-wide Stoxx Europe 600 was down 0.2 per cent shortly after the opening bell, as was London’s FTSE 100. France’s Cac 40 and Germany’s Dax both dropped 0.4 per cent. 

Mining stocks were among the few positive performers in Europe as metals prices continued to rally on hopes that a rebound in economic growth will stimulate demand.

Contracts tracking Wall Street’s benchmark S&P 500 and the tech-heavy Nasdaq Composite were little changed ahead of the New York market open after both indices closed near to flat in the previous session.

Turkey has restricted exports to Israel of industrial goods and commodities as President Recep Tayyip Erdoğan’s government comes under increasing pressure to crack down on the country over its war against Hamas. 

Turkey’s trade ministry said on Tuesday it would restrict exports of 54 goods, including construction machinery and a variety of metals, fuels and oils. 

Turkey exported about $5.4bn to Israel in 2023, according to the Turkish Statistical Institute. 

The move comes after foreign minister Hakan Fidan said late on Monday that Turkey would take “a string of measures against Israel until a ceasefire is achieved and Israel allows uninterrupted aid into Gaza.” Erdoğan has been criticised domestically for not taking enough action to curb trade with the country.

Highly indebted French IT services company Atos said it needs €600mn in cash between now and 2025 as it rushes to lay out its financing needs to investors. 

The company said it needed to reduce its debt by €2.4bn and extend all remaining maturities by five years. Atos has €3.65bn in debt maturing before the end of 2025, and the company said it aimed to have an agreement in place with creditors by July. 

Interim financing of €450mn will provide liquidity until a deal is finalised, according to Atos, who said that it had reached an agreement in principle with a group of banks, bondholders and the French state.

Japan’s stock market rallied on Tuesday afternoon as the country’s currency weakened further against the dollar.

The benchmark Topix index added 1 per cent as the yen fell 0.06 per cent against the dollar to ¥151.88, edging closer to the ¥152 level widely seen by traders as the threshold for government intervention.

On Tuesday, Japan’s finance minister repeated his warning that the government was prepared to act against excessive declines in the yen.

Hong Kong’s Hang Seng index held on to some of its early gains and was up 0.6 per cent in the afternoon session. Xinyi Solar rose 5.2 per cent, bringing its gains for the year to 42.1 per cent.

HSBC has agreed to sell its Argentina unit to Grupo Financiero Galicia for $550mn, a move that will trigger a $1bn loss in its earnings for the first quarter of this year. 

Noel Quinn, chief executive of the UK-based bank, said in a statement on Tuesday that the sale “enables us to focus our resources on higher value opportunities across our international network”. 

The sale will also force the bank to recognise $4.9bn in historical currency translation reserve losses when the deal closes, HSBC said. Those losses grew by $1.8bn in 2023 because of the devaluation of Argentina’s peso. 

UK economic indicators: The British Retail Consortium releases retail sales data for March. In February, BRC reported total retail sales rose at an annual rate of 1.1 per cent, down from 1.2 per cent in January, and the slowest rate since August 2022. UK lender Barclays will also publish March consumer spending. Business lobby group CBI publishes its quarterly Financial Services Survey.

Ireland: The country’s parliament returns from recess and Simon Harris is due to be voted in as taoiseach, heading Ireland’s three-party coalition after Leo Varadkar’s shock resignation last month.

Central banks: Bank of England governor Andrew Bailey presents the UK’s new bank notes featuring King Charles III’s portrait. Martin Flodén, deputy governor of Sweden’s Riksbank, speaks at a DNB Bank event about the country’s economy and monetary policy.

EU events: Swedish foreign minister Tobias Billstrom hosts a two-day meeting with his Nordic and Baltic counterparts on the island of Gotland. Frank-Walter Steinmeier and Zuzana Čaputová, presidents of Germany and Slovakia, review troops in Berlin.

Hong Kong’s stock market led gains in Asia on Tuesday morning, rising 1.1 per cent in early trading.

Utilities sector companies rose the most, with shares of Chinese group ENN Energy leading gains with 5.8 per cent.

Mainland China’s benchmark CSI 300 was muted, shedding 0.3 per cent.

Most Asian currencies fell against the dollar, with Japan’s yen losing 0.06 per cent against the dollar to ¥151.88, edging closer to the ¥152 threshold widely seen by traders as the point where government intervention becomes likely.

The offshore Chinese renminbi also fell 0.06 per cent to Rmb7.25.

The US military said on Monday its forces had destroyed a Houthi missile system that was “ready to launch” attacks on commercial shipping off the coast of Yemen.

US Central Command said it had also destroyed a ground control station in an area of Yemen controlled by the rebels and one unmanned aerial system launched by “Iranian-backed Houthi terrorists”.

Earlier, a missile was launched at the Hope Island, a British-owned, Italian-operated container ship, Central Command said. There were no injuries or damage reported.

Economic data: China is scheduled to release data on new loans and total social financing. Japan announces figures on household confidence and machine tool orders. The New Zealand Institute of Economic Research’s business confidence index is published.

Corporate results: Chinese communications company Hytera announces earnings.

Events: Vatican foreign minister Archbishop Paul Gallagher meets his Vietnamese counterpart Bui Thanh Son in Hanoi.

Fifa and US sports promoter Relevent have reached an agreement to end their legal fight over a ban on big European football leagues and clubs playing official matches in the US.

Relevent and the world football governing body told a Manhattan federal court on Monday that they expect the agreement “will resolve the claims between them” in the litigation.

There is no guarantee that the resolution will result in European league games taking place in the US. But Relevent told the Financial Times that Fifa was considering “changes to its existing rules about whether games can be played outside of a league’s home territory”.

Read more here.

US equities indices closed mixed, a subdued start to a week in which inflation data and minutes from the Federal Reserve’s March meeting will feed into traders’ expectations for the interest rate outlook this year.

The benchmark S&P 500 finished 0.03 per cent lower, while the Nasdaq Composite advanced by a similar magnitude. The small-cap focused Russell 2000 had a better day and added 0.5 per cent.

Treasury yields returned to session highs during afternoon trading, leaving them at levels seen in late November.

Gold continued to rally, hitting a record intraday high of $2,353.79 a troy ounce.

The capability of new artificial intelligence models will surpass human intelligence by the end of next year, so long as the supply of electricity and hardware can satisfy the demands of the increasingly powerful technology, according to Elon Musk.

“My guess is that we’ll have AI that is smarter than any one human probably around the end of next year,” said the billionaire entrepreneur, who runs Tesla, X and SpaceX.

Within the next five years, the capabilities of AI will probably exceed that of all humans, Musk predicted on Monday during an interview on X with Nicolai Tangen, the chief executive of Norges Bank Investment Management.

Read more here.

The US is “very focused on ensuring” Russia is not able to develop new liquefied natural gas projects, one of the country’s senior diplomats said.

The remarks by Geoffrey Pyatt, the US assistant secretary of state for energy resources, to the FT’s Commodities Summit related to Russia’s Arctic LNG 2 project, which is led by private company Novatek.

The US put the flagship project under direct sanctions in November, in effect blocking its stakeholders from getting LNG. Novatek, however, is also developing another major project in the Murmansk region.

“Our goal is to ensure that Arctic LNG 2 is dead in the water,” Pyatt said, adding that while he cannot preview future sanction actions, “we’re very focused on ensuring that Russia is not able to develop new [LNG] projects in order to [redirect] the gas that it had previously sent into Europe”.