European shares end lower as investors assess mixed earnings; focus on trade talks
The pan-European STOXX 600 index (.STOXX), opens new tab closed 0.1% lower, as a drop in healthcare stocks such as Roche (ROG.S), opens new tab and Novonordisk (NOVOb.CO), opens new tab offset gains in mining companies (.SXPP), opens new tab.
Traders were gearing up for a week filled with corporate updates in both Europe and the U.S. and will scrutinize company reports for any clues on the impact trade uncertainty has had on profitability and consumer demand.
On Monday, Stellantis (STLAM.MI), opens new tab said it expects a net loss of 2.3 billion euros ($2.68 billion) for the first half of 2025 as the automaker faced the dual challenge of revamping its product ranges while also dealing with the impact of U.S. tariffs.
Shares of the automaker were volatile throughout the day and settled about 1.5% higher.
Ryanair (RYA.I), opens new tab jumped 5.7% after Europe's largest low-cost carrier reported that its quarterly profit more than doubled. Other airline stocks such as Lufthansa (LHAG.DE), opens new tab and EasyJet (EZJ.L), opens new tab gained about 1% each.
Meanwhile, trade negotiations were high on the radar as diplomats said that the EU is exploring wide-ranging "anti-coercion" measures which would let the bloc target U.S. services or curb access to public tenders in the absence of a deal.
U.S. President Donald Trump has threatened 30% duties on imports from Europe if no agreement is signed before the August 1 deadline.
"The question ultimately boils down to whether the EU can swallow an unbalanced outcome which is tilted in favour of the U.S., or whether Trump would accept some form of EU countermeasures without ratcheting up tariffs further," said Henry Cook, senior economist at MUFG bank.
"The landing ground for a deal still looks small and there is plenty of risk that things could go south."
The benchmark STOXX 600 has recovered all its losses from the April selloff when Trump slapped tariffs on world economies. However, trade ambiguities and their impact on corporates have kept investors wary.
The prevailing uncertainty had investors also flocking to safe-havens including gold and European sovereign bonds on Monday. EUR/GVD
Among stocks, Delivery Hero (DHER.DE), opens new tab logged its biggest one-day jump of over 16% in more than a year. On Friday, Prosus had offered to slash its stake in the German company and give up its board seat to address EU concerns over its 4.1 billion euro ($4.78 billion) Just Eat Takeaway (TKWY.AS), opens new tab deal, according to sources.
Miners Glencore (GLEN.L), opens new tab, Anglo American (AAL.L), opens new tab and Antofagasta (ANTO.L), opens new tab rose between 3% and 5%, tracking a rise in industrial metal prices after China vowed to stabilise its industrial growth, and on hopes for more stimulus. IRN/
Markets also await the ECB's policy decision later this week with traders pricing in no change in interest rates.
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Telegraph
an hour ago
- Telegraph
Rachel Reeves won't break her fiscal rules, she'll destroy them
For those not paying attention, this Labour Government is turning deception into a fine art. The technique is simple enough: make a pledge that seemingly provides reassurance, then drive a Challenger tank through the pretence, while claiming the literal promise has been maintained. The obvious example is Labour's pledge not to raise the taxes of working people. From the Prime Minister, Sir Keir Starmer, to the Chancellor, Rachel Reeves, on to the Chief Secretary to the Treasury, Darren Jones, and any Labour minister being grilled in an interview, the mantra is repeated. Income tax, employee National Insurance contributions and VAT have not been increased – so there have been no taxes raised on working people. The undeniable fact that increases in employers' National Insurance contributions and other taxes result in costs being borne by working people causes no shame, no embarrassment and no admission of a promise being broken. The next big promise to be broken but not betrayed is that the tax and spend plans of Reeves will stay within the fiscal rules she has set herself. By this, the Chancellor means that a responsible government matches its day-to-day spending with its income and only borrows to invest. The latest public borrowing figures have taken a howitzer to this pretence, effectively blowing it out of the water. The deficit for June was £6.6bn higher than the same month last year, while the gap has grown by £7.5bn when you compare this financial year to the previous – and we're only three months in. Andrew Sentance, a former Bank of England economic adviser who served on its Monetary Policy Committee for five years, suggests the 'deficit for 2025/26 [is] heading for £170bn, 5.5-6pc of GDP, even higher than last year – totally unsustainable and over £50bn above the OBR forecast'. Unfortunately for the Government, the many tax rises Reeves announced in her Budget of October 2024 accelerated behavioural responses in the British public to avoid tax increases. The result has been – at best – erratic economic growth, unpredictable tax revenues and a rise in borrowing to meet its everyday commitments. In reality, Reeves is borrowing now to pay for past borrowing and Labour's additional spending that we cannot afford. That is why even the dogs in the street are barking loudly about higher taxes being necessary for her next Budget to stay within the fiscal rules. Were Reeves to abandon her talk of supposed prudence, there would likely be a market response akin to her experiencing skydiving without a parachute. What can the Chancellor do to avoid such a fate? This was signalled in March 2024, when in her Mais Lecture, she revealed an approach to debt financing that would augur greater use of the EU's style of borrowing that, like old Private Finance Initiative (PFI) schemes, could be used to 'invest' in net zero and other politically driven infrastructure. It will keep some beneficiaries in the private sector happy while allowing Labour to claim it is making investments for our future without driving up the debt burden. Bob Lyddon, an international banking and finance consultant, explained her cunning plan in his paper Decoding Rachel Reeves and remains convinced that while tax rises to meet everyday funding will undoubtedly be necessary, the Chancellor will attempt to balance her bromides with honeyed announcements of grand schemes that promise much but deliver little. Reeves signalled how a small amount of 'borrowing for investment' by the Government could be multiplied by having intermediate public entities (like Great British Energy and the National Wealth Fund) borrow as well, and by the resultant schemes also borrowing, this time from investment companies like BlackRock and UK pension schemes. The result will be an Enron-style debt mountain costing 10pc per annum plus the repayments, all falling on the hapless UK business and personal taxpayers one way or another. It is an EU 'bait and switch' that grows off-balance sheet debt that eventually crystallises and has to be paid, just like off-balance sheet PFI still has to be paid. This vision is consistent with Labour's ambition of realignment with the EU and will result in the UK experiencing the same sub-optimal levels of economic growth. It allows Labour to say it is meeting its commitments to splurge great dollops of money into our economy without us feeling the hit. The price would be paid over a 50-year-long commitment that will not immediately result in higher taxes but will drive up the running costs of the public sector. We should be afraid. When Reeves talked up the supposedly halcyon days of Gordon Brown's grandiose public borrowing and especially his use of PFI 'investment' she ignored how it still costs us billions to repay today. The total PFI payments from 1996/97 up to the final transaction not due until 2052/53 are £278.3bn – representing an astonishing 555pc of the £50.1bn capital sum. Of the total of 669 PFI contracts, 588 were under Labour's Blair and Brown governments. An estimate by the Left-leaning Institute of Public Policy Research (IPPR) priced £13bn of Labour's 1998 PFI-funded NHS capital investment to have a cost of £80bn, and by 2019, it still had £55bn to pay. My money's on Lyddon being right, meaning Labour's next big political double-cross will be to say its fiscal rules are being met when she's driving that tank right over them. While she distracts us with carefully composed doublespeak about the need to increase taxes (because Reeves knows no other way to make her numbers add up and will not be allowed to cut spending), hidden borrowing will be conjured up, too. Ultimately, that will mean yet further tax rises for our grandchildren and their children too. Whether or not our economy or our people can bear it, we shall never know – for none of us are likely to be around to see the carnage.
Telegraph
an hour ago
- Telegraph
Tax rises killing off pub summer holiday jobs, warn bosses
It's a been rite of passage for university students for decades. But now Rachel Reeves's tax raid risks killing off the traditional pub summer holiday jobs amid a sharp slump in hospitality vacancies, bosses have warned. Job openings in the hospitality sector - which includes pubs and restaurants - fell by over 22,000 in June compared to the same month a year earlier, according to figures from the Recruitment and Employment Confederation (REC). Industry groups have warned the sharp drop risks 'the death of the great British summer job' as students finishing up college and university struggle to find work behind the bar during their holidays. Britain's pubs and restaurants have long been a source of temporary work for thousands of students across the country. It adds to the mounting worries for young people who are facing a challenging labour market this summer. Neil Carberry, the chief executive of REC, said the fall in vacancies was a 'red flag' for the wider UK economy. 'Hospitality is one of the UK's biggest entry points into work, but right now, we are shutting people out before they even get a foot in the door,' he said. Many hospitality businesses have put a freeze on hiring or cut jobs following Ms Reeves's tax raid in the autumn Budget, which increased the cost of employing staff by raising employers' National Insurance Contributions. Mr Carberry said the decline in open roles 'puts recruiters, hospitality businesses and customers under massive pressure to make the most of the short-lived English summer'. According to the trade body UKHospitality, the Chancellor's tax raid added £3.4bn in costs to hospitality businesses. Around 84,000 jobs have been lost in the sector since last year's autumn Budget as companies attempt to shed workers following the rise in labour costs. The jobs fall comes at a time when the British tourism industry is booming, with visitors making the most of a warm start to the summer. Spending on day visits by tourists in England climbed to £48.4bn in 2024, up 6pc from a year earlier. According to the latest monthly figures, Britons went on 68.6m trips within the UK in April, a 10pc increase from the same month in 2023. Despite the strong visitor numbers, the hospitality and tourism sectors have been left grappling with mounting costs following last year's autumn Budget. Allen Simpson, the chief executive of UKHospitality, said the decline in vacancies was 'sadly reflective of the impact we have seen from increased costs over the past nine months – less employment, less opportunity and less growth in the economy'. The warnings over hospitality roles came as figures released by the Office for National Statistics earlier this month revealed that the number of jobs advertised across the country fell to 727,000 in the three months to June, down from 783,000 for the previous three-month period. Mr Simpson called on the government to 'reverse the damage' facing the hospitality industry. 'That starts with fixing NICs, lowering business rates and cutting VAT for hospitality businesses,' he said. The hospitality industry has borne the brunt of the Chancellor's tax raid. Earlier this month, the British Beer and Pub Association warned that one pub a day would shut across Britain this year as publicans battle surging costs, including Ms Reeves's £25bn National Insurance raid and an increase in the minimum wage. The Treasury was contacted for comment.
The Sun
an hour ago
- The Sun
Nine money changes happening in August including benefit that could be stopped worth £1,354.60 if you don't act NOW
AS we head into August and the last month of summer, there are several important financial changes that will affect your money, from student loans and benefits to bank accounts and interest rates. Whether you're managing your household budget, planning ahead for childcare, or keeping an eye on mortgage costs, knowing what's coming can help you stay in control and avoid any surprises. 1 We've gathered all the key dates and explained what you need to know and do, so you can prepare your finances for the weeks ahead. Aug 1: Tuition fee rise takes effect in England From August 1, 2025, undergraduate tuition fees in England will rise from £9,250 to £9,535 a year. Students will also be able to borrow more to help with living costs, with the maximum maintenance loan for those living away from home outside London increasing from £10,227 to £10,544. All students will get an uplift in support for the 2025 to 2026 academic year, with the government predicting that the most help will go to those from households earning £25,000 or less. Student loan repayment rules changed in England in 2023, meaning graduates are likely to pay back more over a longer period than before. Graduates who started repayments in April 2025 had an average debt of £53,000, according to the Student Loans Company. Aug 6: eBay faster payments come in From August 6, eBay is speeding up payments to some sellers. Those who have completed at least 10 sales totalling £150 or more over the past five years, and have no more than two unresolved cases in the last 12 months, will receive their funds within 24 hours of sale. This replaces the previous system where sellers had to wait two days after delivery confirmation before payment. An unresolved case means any buyer dispute that wasn't resolved or where eBay ruled in favour of the buyer. This change should help sellers manage their cash flow more easily. Aug 7: Bank of England base rate decision On August 7, the Bank of England (BoE) is expected to announce its next base rate decision. At its last meeting, policymakers kept the rate steady at 4.25%, with six voting to hold and three in favour of a cut. The BoE is closely watching signs of a cooling labour market alongside inflation, which rose to 3.6% in the 12 months to June, according to the Office for National Statistics (ONS). The base rate affects borrowing costs and savings returns. Most mortgage holders are on fixed deals, so payments won't change immediately. However, UK Finance estimated in January that around 1.8 million fixed-rate deals will end this year, meaning lots of homeowners could soon face higher rates. What is the base rate and how does it affect the economy? NINE members of the Bank of England's Monetary Policy Committee meet eight times each year to set the base rate. Any change to the Bank's rate can have wide-reaching consequences as it directly influences both: The cost that lenders charge people to borrow money The amount of savings interest banks pay out to customers. When the Bank of England lowers interest rates, consumers tend to increase spending. This can directly affect the country's GDP and help steer the economy into growth and out of a recession. In this scenario, the cost of borrowing is usually cheap, and the biggest winners here are first-time buyers and homeowners with mortgages. But those with savings tend to lose out. However, when more credit is available to consumers, demand can increase, and prices tend to rise. And if the inflation rate rises substantially - the Bank of England might increase interest rates to bring prices back down. When the cost of borrowing rises - consumers and businesses have less money to spend, and in theory, as demand for goods and services falls, so should prices. The Bank of England is tasked with keeping inflation at 2%, and hiking interest rates is a way of trying to reach this target. In this scenario, the losers are those with debt. First-time buyers will lose out to cheaper mortgage rates, and those on tracker or standard variable rate mortgages are usually impacted by hikes to the base rate immediately. Those on a fixed-rate deal tend to be safe if they fixed when interest rates were lower - but their bills could drastically increase when it's time to remortgage. The cost of borrowing through loans, credit cards and overdrafts also increases when the base rate rises. However, the winners in this scenario are those with money to save. Banks tend to battle it out by offering market-leading saving rates when the base rate is high. Markets generally expect two rate cuts this year, potentially lowering the base rate to 3.75% by December. But rising food prices and global uncertainties mean the outlook remains uncertain. If your mortgage deal is ending soon, now's a good time to review your options. For savings, shop around to find the best rates. Credit card and loan rates are unlikely to change immediately but remain higher than in recent years. Aug 20: July inflation figures and rail fare rises The Office for National Statistics (ONS) will release the July inflation figures on August 20. Inflation, measured by the Consumer Prices Index (CPI), shows how much the cost of everyday goods and services is rising. In June, CPI inflation was 3.6%, up from 3.4% the previous month and still well above the Bank of England's 2% target. Inflation influences many parts of daily life, including rail fares. In England, annual increases to regulated rail fares such as season tickets and off-peak travel are usually linked to the July Retail Prices Index (RPI) measure of inflation. The cost of unregulated tickets, such as first class, advance and anytime fares, is set by train companies. Aug 21: Santander axing popular current account Santander is closing its 123 Lite current account on August 21. Hundreds of thousands of customers will lose the account's popular 3% cashback on household bills, which is capped at £15 a month and comes with a £2 monthly fee. Affected customers will be automatically switched to Santander's Everyday Current Account, which has no monthly fee but offers no cashback. If you want to keep earning cashback with Santander, consider switching to the Edge or Edge Up accounts. Edge offers 1% cashback on some household bills, supermarket shopping, petrol, and travel, with a £3 monthly fee capped at £10 cashback. Edge Up costs £5 a month and offers up to £15 cashback, but requires a higher monthly deposit. Note that from September 9, cashback on supermarket, fuel, and travel spending will be removed from both accounts, leaving cashback only on household bills. If you're looking for better cashback deals elsewhere, some credit cards offer higher rewards. For example, the American Express Cashback Everyday Credit Card gives up to 5% cashback on spending for the first five months. Aug 25: Bank holidays affecting benefit payment dates If your benefit payment usually falls on a bank holiday, it will be paid early. For example, payments due on Monday August 25 (the bank holiday) will arrive on Friday August 22 instead. You'll get your money sooner, but since the next payment won't move, you'll need to budget carefully as the gap between payments will be longer. It's also standard for payments due on weekends to be paid on the preceding working day. So, payments normally scheduled for Saturday 23 or Sunday 24 August will also arrive on Friday August 22. This early payment applies to a range of benefits, including: Attendance allowance Carer's allowance Child Benefit Disability Living Allowance Employment Support Allowance (ESA) Income Support Jobseeker's Allowance (JSA) Pension Credit Personal Independence Payment (PIP) State Pension Universal Credit If you receive the basic state pension, your payments come every four weeks on a weekday linked to the last two digits of your National Insurance number: 00 to 19: Monday 20 to 39: Tuesday 40 to 59: Wednesday 60 to 79: Thursday 80 to 99: Friday The next bank holidays affecting payments after August will be in December. Payments due on Christmas Day and Boxing Day will be paid early on 24 December, this year. Aug 31: Deadline to extend Child Benefit claims for 16- to 19-year-olds Parents of teenagers aged 16 to 19 must extend their Child Benefit claim by August 31 to keep payments coming in September. If a claim isn't extended, Child Benefit will automatically stop from August 31 after a child's 16th birthday. HM Revenue & Customs (HMRC) sends reminders to parents to confirm online if their teenager is staying in full-time education or approved training after GCSEs. Parents can extend claims easily via the HMRC app or with letters including a QR code for quick access. Child Benefit currently pays £26.05 per week for the eldest or only child, and £17.25 per week for each additional child. Last year, over 870,000 parents extended their claims online or through the app in minutes. Aug 31: Deadline to resubscribe for free childcare codes If you want to keep or start receiving up to 30 hours of free childcare a week for children aged 9 months to 4 years, you must apply or renew your childcare code by August 31. This applies to working parents in England who use registered childcare providers such as nurseries, playschemes, or wrap-around care. You'll need to set up a childcare account online and apply via or the HMRC app. Once approved, you'll get an 11-digit code to give your childcare provider as proof of eligibility. If your child turns 9 months old between April 1 and August 31, you must apply by August 31 to get free childcare starting in September. If you already receive 15 hours for your child under two, you'll automatically get 30 hours from September, but you still need to confirm your details and provide the code to your provider. Remember to apply early, ideally at least six weeks before the deadline. Some childcare providers ask for codes before the official deadline. Once you have your code, you'll need to reconfirm your details every three months to keep your place, although some providers may offer a short grace period. If you're starting a new job, returning from parental leave, or changing circumstances, deadlines vary - but August 31 is the key date for many parents wanting free childcare starting this autumn. You can apply or check eligibility here. Are you missing out on benefits? YOU can use a benefits calculator to help check that you are not missing out on money you are entitled to Charity Turn2Us' benefits calculator works out what you could get. Entitledto's free calculator determines whether you qualify for various benefits, tax credit and Universal Credit. and charity StepChange both have benefits tools powered by Entitledto's data. You can use Policy in Practice's calculator to determine which benefits you could receive and how much cash you'll have left over each month after paying for housing costs. Your exact entitlement will only be clear when you make a claim, but calculators can indicate what you might be eligible for.
