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iSnapchat signals end to federal probe
The owner of messaging app Snapchat has signalled
that US authorities may have dropped a probe into
whether it misled investors on competition from
Facebook-owned rival Instagram.— PAGE 11iKiev detains Russian tanker in Black Sea
Ukraine has detained and searched a Russian ship it
said was involved in a naval clash last year between
the two countries in the Black Sea, in a move likely to
increase Moscow-Kiev tensions.—PAGEiTunisia’s president Sebsi dies, aged 92
Beji Caid Sebsi, Tunisia’s
president, has died aged 92, just
months before he was to step
down having helped guide the
country through the aftermath
of the Arab spring.—PAGEiNissan expands scope of restructuring
Nissan is to lose 12,500 jobs and reduce the number
of models it produces by 10 per cent in an expansion
of its revamp plans after its quarterly profit fell
95 per cent.— PAGE 12; LEX, PAGE 10iMoscow police hold Putin critic Navalny
Police have arrested Alexei Navalny and raided his
allies’ homes in a sign that the Kremlin fears dissent
before September’s local elections as President
Vladimir Putin’s approval ratings slide.—PAGEiCaxton HQ shift gives boost to London
In a symbolic boost to Britain’s financial services as
Brexit looms, Caxton, one of the world’s oldest and
best-known hedge funds, has told investors that its
HQ is now in London rather than New York.— PAGE 11iJBS joins trend for extending maturities
Brazil meat processor JBS joined the trend for issuing
longer-dated debt as borrowing costs fall, sparking
fears that monetary easing will see companies take
on more debt than they can handle.— PAGE 19Datawatch
Losing patience
Business is fed up with the IMF and
World Bank— GILLIAN TETT, PAGE 9
FRIDAY26 JULY 2019 WORLD BUSINESS NEWSPAPER EUROPE
World Markets
STOCK MARKETS
Jul 25 prev %chg
S&P 500 3006.02 3019.56 -0.
Nasdaq Composite 8264.39 8321.50 -0.
Dow Jones Ind 27146.14 27269.97 -0.
FTSEurofirst 300 1531.54 1539.83 -0.
Euro Stoxx 50 3515.03 3532.90 -0.
FTSE 100 7489.05 7501.46 -0.
FTSE All-Share 4096.03 4100.36 -0.
CAC 40 5578.05 5605.86 -0.
Xetra Dax 12362.10 12522.89 -1.
Nikkei 21756.55 21709.57 0.
Hang Seng 28594.30 28524.04 0.
MSCI World $ 2217.75 2209.59 0.
MSCI EM $ 1055.34 1055.49 -0.
MSCI ACWI $ 531.82 530.10 0.CURRENCIES
Jul 25 prev
$ per € 1.116 1.
$ per £ 1.250 1.
£ per € 0.893 0.
¥ per $ 108.550 108.
¥ per £ 135.638 135.
SFr per € 1.105 1.
€ per $ 0.896 0.Jul 25 prev
£ per $ 0.800 0.
€ per £ 1.120 1.
¥ per € 121.125 120.
£ index 76.548 76.
SFr per £ 1.237 1.COMMODITIESJul 25 prev %chg
Oil WTI $ 56.26 55.88 0.
Oil Brent $ 63.62 63.18 0.
Gold $ 1426.95 1425.55 0.INTEREST RATES
price yield chg
US Gov 10 yr 127.32 2.08 0.
UK Gov 10 yr 148.67 0.71 0.
Ger Gov 10 yr 148.22 -0.37 0.
Jpn Gov 10 yr 121.52 -0.15 0.
US Gov 30 yr 103.32 2.61 0.
Ger Gov 2 yr 101.20 -0.77 0.price prev chg
Fed Funds Eff 2.38 2.39 -0.
US 3m Bills 2.10 2.06 0.
Euro Libor 3m -0.42 -0.41 -0.
UK 3m 0.78 0.78 0.
Prices are latest for edition Data provided by MorningstarGEORGE PARKER AND
ROBERT WRIGHT— LONDON
JIM BRUNSDEN— BRUSSELSBoris Johnson has been accused by the
EU’s chief Brexit negotiator of laying
down “unacceptable” terms for talks
on a new exit deal, setting the scene for
bruising clashes between Brussels and
the new British prime minister.Michel Barnier wrote to 27EU member
states warning that Mr Johnson’s
“rather combative speech” to the House
of Commonshad raised the risk of no-
deal Brexit, and urged them to hold
their nerve. Mr Johnson, in his first
statement to MPs since entering 10
Downing Street, demanded the aboli-
tion of theIrish border backstop, which
is at the heart of the exit deal agreed by
his predecessor Theresa May.
Mr Johnson stepped up warnings thatBritain would leave without a deal on
October 31, promising to “turbo-
charge” preparations. He gave the
impression that he was waiting for the
EU to accept his demand that the with-
drawal treaty be ripped up before he
would open talks.
The prime minister, who promised
that a “golden age” awaited Britain once
Brexit was delivered, said: “If an agree-
ment is to be reached it must be clearly
understood that the way to the deal goes
by way of the abolition of the backstop.”
He said he would be willing to talk “on
this basis”, insisting that the insurance
policy against a hard border in Ireland
was unnecessary and could be dealt
with in the months ahead as part of talks
on a future trade deal.
Mr Barnier wrote: “This is of course
unacceptable and not within the man-
date of the European Council.” His mes-sage was reinforced by Jean-Claude
Juncker, outgoing European Commis-
sion president, in a telephone call with
Mr Johnson in which he told the prime
minister that the existing exit deal was
“the best and only agreement possible”.
Mr Barnierreferred to the parliamen-
tary resistance to no-deal that Brussels
expects Mr Johnson to face, noting the
“many strong reactions to the speech in
the House of Commons”.
“In this context we must follow care-
fully the further political and economic
reactions and developments in the UK
following this speech,”he wrote. Mr
Johnson and Mr Juncker agreed to
exchangephone numbers, heralding a
busy period of EU summer diplomacy.
Brexit resolvepage 2
Editorial Comment & Letterspage 8
Philip Stephenspage 9
Currenciespage 19EU criticism of Johnson’s ‘unacceptable’
Brexit terms sets scene for bruising talks
© THE FINANCIAL TIMES LTD 2019
No: 40,152★Printed in London, Liverpool, Glasgow, Dublin,
Frankfurt, Milan, Madrid, New York, Chicago, San
Francisco, Orlando, Tokyo, Hong Kong, Singapore,
Seoul, Dubai, DohaAnalysisiPAGE 15;LexiPAGE 10Facebook warns on delays
to launching new productsAustria €3.80 North Macedonia Den
Bahrain Din1.8 Malta €3.
Belgium €3.80 Morocco Dh
Bulgaria Lev7.50 Netherlands €3.
Croatia Kn29 Norway NKr
Cyprus €3.60 Oman OR1.
Czech Rep Kc105 Pakistan Rupee
Denmark DKr37 Poland Zl 20
Egypt E£42 Portugal €3.
Finland €4.50 Qatar QR
France €3.80 Romania Ron
Germany €3.80 Russia €5.
Gibraltar £2.70 Serbia NewD
Greece €3.60 Slovak Rep €3.
Hungary Ft1090 Slovenia €3.
India Rup220 Spain €3.
Italy €3.60 Sweden SKr
Latvia €6.99 Switzerland SFr6.
Lebanon LBP7500 Tunisia Din7.
Lithuania €4.30 Turkey TL
Luxembourg €3.80 UAE Dh17.Much progress
has been made
towards having
people vaccinated
against hepatitis.
Yet immunisation
rates for its most
serious form are
stagnating. In
Latin America,
rates actually fell
14 percentage
points in less
than a decade.Fighting hepatitis
Immunisation coverage, third dose
of hepatitis B vaccine ( ) GlobalLatin America & CaribbeanSouth AsiaWest & Central AfricaSources: Unicef, WHOThe past recast
How Viktor Orban is rewriting
Hungary’s history— BIG READ, PAGE 7
Big tech’s big fail
Silicon Valley has neglected climate
change— HENRY MANCE, PAGE 8
CLAIRE JONES— FRANKFURTMario Draghi has paved the way for a
fresh package of monetary stimulus
measures to boost the ailing eurozone
economy before he departs in October,
signalling that the European Central
Bank will cut rates and embark on a
fresh round of asset purchases.
The ECB presidentsaid yesterday that
officials at the eurozone’s central bank
would look into a range of stimulus
options — including rate cuts, a commit-
ment to keeping policy exceptionally
loose for years to come and another
quantitative easing package — to coun-
ter fears that the bank would persist-
ently undershoot its inflation target of
just under 2 per cent.
“A considerable mass of inflation
expectations are moving towards [a
belief that there will be] lower infla-
tion,” said Mr Draghi. “We don’t like it
and therefore we are determined to act.”
ECB watchers viewed his ratcheting
up of the rhetoric on inflation as a clear
sign that the governing council would, at
its next meeting in September, join a
growing chorus of central bankers loos-
ening policy to counter fears of a global
slowdown. Mr Draghi is due to step
down after the ECB’s October meeting,
to be replaced by Christine Lagarde,
currently head of the IMF.
“It now increasingly looks as if the
September meeting will not only bring a
single measure but rather a package of
several measures,” said Carsten Brzeski,
chief economist at bank ING Germany.
The US Federal Reserve is expected to
cut interest ratesby a quarter-point at
its monetary policy vote next week.
Mr Draghi said “most people” on the
governing council “converged on this”
response to the economic slowdown but
admitted the statement did not have
unanimous support. In recent weeks
some hawks on the council have
sounded lukewarm on the prospect of
fresh stimulus.
Despite the clear sign of fresh easing,market reaction to the decision was
muted. The euro went on a volatile run,
bouncing up off two-year lows to rise 0.
per cent overall, at $1.1169, as Mr Draghi
spoke to reporters.
A rally forgovernment bondsalso
faded, drawing yields higher as the trad-
ing day developed.
The yield on benchmark 10-year Ger-
man Bunds rose1.1 basis points, to
minus 0.369 per cent. Yields on 10-year
Italian debt alsorose, up 2.6 basis points
to 1.522 per cent.
European stocks were unsettled.
Frankfurt’s Xetra Dax index fell 0.1 per
cent, surrendering earlier gains.
The region-wide Stoxx 600 slid 0.
per cent. Its banking index pared initial
gains to end flat on the day.
Some investors had expected thebank to cut rates as soon as yesterday,
citinga raft of bad dataon the Germany
economy, the eurozone’s largest and
until recently its economic powerhouse.
Instead, the ECB opted to keep rates on
hold, with the main refinancing rate
remaining at zero and the deposit rate at
minus 0.4 per cent.
In a move that paved the way for rate
cuts in the coming months, the govern-
ing council changed its forward guid-
ance to say that it expected rates to
remain “at their present or lower levels”
at least through the first half of 2020.
The mention of lower rates raised
markets’ expectations that the ECB will
cut the deposit rate in September.
“The ECB might have disappointed
those looking for an immediate rate cut
after the spate of weak sentimentdata but their statement of intent is
clear: easing is coming, and soon,” said
Hetal Mehta, senior European econo-
mist at Legal & General Investment
Management.
The bank has not expanded its €2.6tn
quantitative easing programme since
December, but Mr Draghi hasindicated
in recent weeksthat it could do so,
should the economic data continue to
suggest growth will remain sluggish.
In his first public comment on Ms
Lagarde’s nomination as his successor,
Mr Draghi endorsed her appointment,
saying she would be “outstanding”.
Additional reporting by Michael Hunter
in London
’Whatever it takes' signalpages 3
Tail Riskpage 11
Day in the marketspage 20Draghi paves the way for stimulus
package to revive ailing eurozone
3 ECB chief hints at loosening policy in September 3 Rate cut and asset purchases signalled
“We don’t like
what we see on the
inflation front. We
are determined
to act ”
MARIO DRAGHIRates slashed
Turkey’s central
bank cut its
benchmark
interest rate by
4.25 percentage
points, marking
an abrupt shift
after the sacking
of its former
governor by
President Recep
Tayyip Erdogan
Page 3
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