Urgent action needed on energy crisis, says Italy’s Mario Draghi – live updates

Britain’s tourism sector is estimated to be losing around £200m every day as domestic and foreign travellers stay at home.

According to new figures from Visit Britain, there was a combined loss of spending of £146bn over 2020 and 2021.

It said £97.1bn of this lost income was from domestic tourism, while £48.6bn came from inbound tourism.

Visit Britain is expecting tourist numbers to recover to around 68pc of pre-Covid levels in 2022. However, these forecasts were made before the outbreak of omicron, and the group warned it could be revised downward significantly.

Some more “de facto lockdown” data now…

The latest footfall figures from London’s West End on Tuesday 21st December show a 27pc drop on pre-pandemic levels.

Shopper numbers were up 10pc on the previous week, suggesting some Londoners were still heading out to buy last-minute Christmas presents.

But the data highlights the impact of the omicron variant on the capital’s retail sector. Jace Tyrrell, chief executive of the New West End Company, called for more substantial support for the sector.

He added:

Once again we are seeing fewer customers on the high street than there were two years ago. Retail and leisure businesses will have spent significant amounts of time and money preparing for a busy Christmas period, only for people to understandably stay at home in the face of rising Covid rates.

It is therefore vital that they receive the financial support required to get them through the winter months – support that must go further than the limited package announced by the Treasury yesterday. We must see tangible relief for the retail industry, alongside more substantial measures for leisure businesses. Otherwise we run the risk of more much-loved brands being forced to close in the coming months.

New figures have highlighted the impact of omicron on rail travel, with passenger numbers slumping after the new strain emerged.

Passenger numbers were at 53pc of pre-pandemic levels on Monday, according to data from the Department for Transport. That’s down from 61pc a week earlier, and 68pc on Monday 6 December.

It follows a renewed work from home order to help curb the rapid spread of omicron, while Brits have also opted to stay away from high streets and city centres as cases surge.

Rail travel has also been hit by hundreds of cancellations this week due to Covid-related staff shortages.

Bus use outside London was at 62pc of pre-Covid levels on Monday, down from 78pc a week earlier.

The Daily Mail’s parent company has announced it will delist from the London Stock Exchange on 10 January.

It comes after Lord Rothermere secured shareholder backing for an £871m take-private deal that will see it leave the stock market after nearly 90 years.

Lord Rothermere, Chairman of Daily Mail and General Trust said:

Today marks a huge milestone for DMGT, as we look towards an exciting and rewarding future under private ownership once again. We have always been a business that backs strong leadership and talent, and today is the ultimate expression of that faith.

Everything we do is in the service of our customers, for whom we will continue to deliver the absolute best, as we have for over 130 years. I would like to extend my thanks to everyone who has played a role in making this momentous day possible. I am excited and inspired by what lies ahead.

Chemicals giant Croda has inked a deal to sell the majority of its performance technologies and industrial chemicals unit for €915m (£778m).

The FTSE 100 company has agreed a sale to US food group Cargill on a cash and debt free basis as it looks to focus on its life sciences and consumer care divisions.

The divested business includes five manufacturing plants across Europe and China, including one in Hull.

Shares in Croda fell 1.4pc following the announcement.

Steve Foots, chief executive of Croda, said:

Today’s announcement completes our transition into a pure-play consumer and life sciences company. We will focus our capital and resources on delivering sustainable solutions and scaling our consumer, health and crop care technologies, leading to consistent sales growth and an even stronger profit margin.

Cargill is a company with a distinguished history and strong values. Under its ownership, the divested business and our talented, hardworking employees can look forward to a bright future.

Elon Musk has offloaded another $528m (£397m) worth of Tesla shares as he closes in on his pledge to sell 10pc of his stake in the company.

The world’s richest man is now more than three-quarters of the way to making good on his sale promise, which came after he polled his Twitter followers on the matter.

The billionaire has now sold around 13.5m shares for about $14.1bn, regulatory filings show. He’ll need to dispose of some 17m shares all up to offload 10pc of his interest in the electric vehicle maker, assuming his pledge excludes exercisable options.

Tesla has declined by about a quarter since a peak on Nov 4, just prior to Mr Musk’s Twitter poll.

It’s a downbeat start to the day for the FTSE, which is now lagging 0.2pc as investors respond to disappointing GDP figures.

Miners are leading the falls, with Rio Tinto down 2pc after it agreed to buy the Rincon lithium project in Argentina for $825m. BHP and Anglo American have also fallen, tracking lower iron ore prices.

Rolls Royce has gained 1.1pc on plans to invest in methanol technology for climate-friendly shipping.

The domestically-focused FTSE 250 is up 0.3pc. It’s being led by investment trust Syncona, which has jumped 8.7pc after announcing Novartis will buy its Gyroscope Therapeutics business for up to $1.5bn.

Sterling steadied against the dollar this morning despite new data showing the economy slowed more than previously thought before the outbreak of the omicron variant.

GDP grew by 1.1pc in the third quarter, revised down from previous forecasts of 1.3pc, according to the ONS. Investors are braced for an even sharper slowdown in the final three months of the year as omicron wreaks havoc across the economy.

Despite this, the pound is broadly flat against the dollar at $1.3264. Against the euro, it’s up 0.1pc at 84.95p.

Still, it remains behind highs reached last week following the Bank of England’s surprise decision to raise interest rates.

The City watchdog is opening a consultation to prepare a redress plan for members of the British Steel pension scheme who were advised to transfer their savings.

The Financial Conduct Authority (FCA) found that 47pc of steelworkers received “unsuitable” pension advice. It described the multi-million-pound scandal as a “highly exceptional case”.

In a letter sent today, the watchdog set out its expectation that firms in the scope of a potential redress scheme should retain assets and should not try to avoid their responsibilities.

The FCA has warned it will take such action as it deems necessary if a firm attempts to avoid redress liabilities. 

It comes after the National Audit Office said it will investigate the FCA over its handling of the British Steel pension saga, which dates back to 2017 and affected thousands of steelworkers.

Wizz Air has snapped up 15 daily slot pairs at Gatwick Airport from Norwegian Air.

Following the deal, the budget airline will have five aircraft based at the London airport starting in the spring of 2022.

Wizz Air said it plans to launch a host of new low-fare routes, while the new slots will also create inbound flight opportunities from Wizz Air Hungary.

Jozsef Varadi, Wizz Air chief executive, said:

This announcement is further evidence of our commitment to London Gatwick Airport as well as the UK market, as we continue to create local jobs and deliver our promise of providing low-fare travel opportunities with excellent service to an ever-increasing range of exciting destinations, while flying one of the greenest aircraft fleets available on the market today.

The UK has inked contracts to buy a further 4.25m courses of antiviral Covid drugs to help tackle the spread of the omicron variant.

The drugs are used to either treat those who are infected with a virus or sometimes protect exposed individuals from becoming infected.

The two new contracts are for 1.75m courses of Merck’s drug and 2.5m additional courses of Pfizer’s pill, which will be available from early next year.

Taylor Wimpey is overhauling residential property contracts that left tenants with escalating costs following scrutiny from the competition watchdog.

The housebuilder said it’s getting rid of “unfair terms” that led to charges known as ground rents doubling every 10 years.

Taylor Wimpey is one of four major British developers targeted by the Competition and Markets Authority (CMA) over the practice. The charges had made it impossible for some leaseholders to sell or mortgage their homes, leaving them tied to properties with soaring costs.

Housing Secretary Michael Gove said: “Unfair practices, such as doubling ground rents, have no place in our housing market. Other developers with similar arrangements in place should beware, we are coming after you.”

Aviva and Persimmon also agreed to change their practices as a result of the crackdown. Investigations into other firms, including Barratt Developments, are ongoing.

Metro Bank has been slapped with a £5.4m fine for failing to meet standards of governance and controls.

The Prudential Regulation Authority (PRA) said the lender failed to act with “due skill, care and diligence” linked to the regulatory reporting of its capital position.

The bank was also fined for failures in its regulatory reporting governance, controls and investment between May 2016 and January 2019.

Shares dropped 1.4pc in early trading.

It comes after the regulator hit Standard Chartered with a record £46.5m fine for failings in its reporting standards.

The FTSE 100 has faltered at the open, putting the brakes on gains following Tuesday’s rally.

The blue-chip index slipped 0.1pc to 7,289 points.

Bethany Beckett, UK economist at Capital Economics, said:

The downward revision to GDP in the third quarter means the economy had a little less momentum going into the closing months of the year than we previously thought. And given early signs that the huge surge in Covid-19 infections has weighed on activity so far in December, GDP growth looks to have slowed in the fourth quarter […]

There were still some encouraging signs within the data. Admittedly, households’ nominal income grew by a bit less than we had anticipated, at 1.1pc quarter on quarter in Q3. But nominal consumer spending rose by 3.3pc quarter on quarter, which was more than we had expected. That means that the household savings rate fell by more than we had forecast, from a downwardly-revised 10.7pc in the second quarter to 8.6% in the third quarter.

But these data are old news and predate the recent surge in virus infections caused by the omicron variant. That already seems to have prompted a weakening of activity in December.

And, although the economy has got better at coping with restrictions with each new wave, the possibility of tighter restrictions in January is further darkening the outlook for GDP.

Darren Morgan, director of economic statistics at the ONS, said:

Our revised figures show UK GDP recovered a little slower in the third quarter, with much weaker performances from health and hairdressers across the quarter, and the energy sector contracting more in September than we previously estimated.

However, stronger data for 2020 means the economy was closer to pre-pandemic levels in the third quarter.

With the economy reopening in the third quarter, households saved less in the latest period. However, household saving was still up on pre-pandemic levels.

Broken down by sector, the ONS stats show the continued strength of the hospitality sector after reopening, while supply chain troubles weighed on manufacturing and construction.

In output terms, the largest contributors to the increase were hospitality, and arts, entertainment and recreation; production and construction both fell.

Meanwhile, household consumption rose by an upwardly revised 2.7pc and made the largest contribution to expenditure.

There was a fall in underlying inventories, likely reflecting some of the recent supply chain challenges; and a negative contribution from net trade.

Good morning. 

We kick off with some rather grim data on the health of the UK economy.

The ONS has revised down its figures for third-quarter GDP growth from 1.3pc to 1.1pc. That’s a sharp slowdown from the 5.4pc growth registered as the country reopened in the second quarter.

It suggests the recovery was struggling even before the omicron variant hit, and investors will be pessimistic about the prospect for fourth-quarter growth.

The only saving grace is that the economy is now only 1.5pc smaller than its pre-Covid levels in the fourth quarter of 2019, rather than a previous estimate of 2.1pc smaller. That’s thanks to some upward revisions to growth in 2020.

5 things to start your day 

1) Ministers stand up to Sage doomsters as economic fears mount  No models about the impact of a new lockdown have been shown to the Cabinet, running the risk of more unbalanced decision-making

2) Gas prices surge to new records as fears of winter crisis deepen  Low storage levels across Europe, reduced output from renewable sources and delays to Nord Stream 2 pipeline are all contributing factors

3) Airbus and Boeing call for 5G delay over aircraft safety fears  World’s two largest plane makers ask Biden administration to support delaying the rollout of high-speed networks in the US

4) Europe’s pandemic recovery fund unravels as billions go to old projects  The bulk of grants allocated under the bloc’s stimulus scheme are funding investments already on the drawing board

5) Bitcoin will replace the US dollar, says Jack Dorsey  The Twitter founder, who recently resigned as its chief executive, made the prediction in a series of controversial exchanges online

What happened overnight 

Most Asian markets rose on Wednesday, extending a global rally as investors assess the impact of the fast-spreading omicron variant.

Traders are also keeping an eye on developments in Washington after President Joe Biden reassured investors by calling for vaccinations and testing but no travel curbs in response to omicron.

Tokyo, Hong Kong, Shanghai, Singapore, Seoul, Taipei, Manila and Jakarta rose but Sydney and Wellington slipped.

Both the Nikkei 225 in Tokyo and the Shanghai Composite Index recorded a 0.1 percent rise, to 28,548.80 and 3,629.47 respectively, while the Hang Seng in Hong Kong was up 0.7pc to 23,143.11

Coming up today

• Corporate: Heineken, Winnebago (Interim results); Revolution Bars (AGM)
• Economics: GDP (UK, US), Chicago Fed National Activity Index (US), personal consumption expenditures (US), consumer confidence (US)