Beijing’s intensifying crackdown on technology, education and other companies has sent shivers through the global economy and world stock markets lower.

Asian technology stocks slumped, leading to a further 4.2% decline in Hong Hong’s Hang Seng after Monday’s 4.1% fall – the steepest drop since the Covid-19 pandemic hit global markets in March 2020. Chinese tech giants Tencent lost 9% and Alibaba dropped 6.4%.

On Wall Street, the tech-heavy Nadaq fell 1.2% ahead of quarterly results from Google, Microsoft and Apple, while the Dow Jones and S&P 500 both lost about 0.6%. A weaker-than-expected US durable goods report added to pessimistic mood, while US consumer confidence improved slightly in July.

The UK’s FTSE 100 index is down 0.45%, while indices in mainland Europe have declined by 0.5%% to 1%.

The CBI’s latest monthly survey points to continued UK retail sales growth in July, despite worker shortages and flat online sales. And Tesco is offering lorry drivers a £1,000 joining bonus until the end of September, amid a huge shortage of HGV drivers.

Here is a round-up of our main stories today:

The world economy risks losing $4.5tn (£3.3tn) from highly-infectious variants of Covid-19 spreading through poor countries where vaccination rates are lower, the International Monetary Fund has warned.

Consumer goods group Reckitt Benckiser, which owns brands including Dettol, Nurofen and Durex, has reported disappointing second-quarter sales, and warned it will have to raise its prices to deal with rising raw material costs.

FirstGroup, one of the UK’s largest bus and train operators, has announced its chief executive is to step down, just a day after the firm’s biggest shareholder called for his resignation.

Warhammer retailer Games Workshop is handing its shop workers, model makers, designers and support staff a £5,000 bonus after sales and profits surged during the pandemic.

Moonpig has reported that its annual sales and profits have doubled in its first results since listing on the stock market, after it benefited from lockdown spending during the Covid-19 pandemic.

Thank you for reading. We’ll be back tomorrow. Good-bye! - JK

US consumer confidence improved to the highest level since the start of the pandemic this month, according to the Conference Board indicator, which rose to 129.1 in July from 127.3 in June. It is almost back to the pre-pandemic level of 132.

But the sell-off on global stock markets continues regardless.

Tesco is offering lorry drivers a £1,000 joining bonus amid a huge shortage of drivers in the industry since Brexit, which has disrupted supermarket and other deliveries and left some supermarket shelves empty.

The BBC has more details (We are also looking into this):

The supermarket giant has deployed the recruitment incentive for candidates who join before 30 September.

Other companies are also understood to be offering similar incentives for HGV drivers after disruption to supply chains led to product shortages.

The Road Haulage Association (RHA) has estimated there is a 100,000 shortage in HGV drivers across the UK.

The industry body has said some 30,000 HGV driving tests did not take place last year because of the coronavirus pandemic, and added a “historic” shortage in drivers had been exacerbated by changes to rules following Brexit.

US stocks have opened slightly lower ahead of results from Microsoft and Apple later.

The Dow Jones fell 65 points, or 0.2%, to 35,078. The S&P 500 slipped nearly 6 points, or 0.1%, to 4,416 and the Nasdaq dropped almost 33 points, or 0.2%, to 14,807.

The world economy risks losing $4.5tn (£3.3tn) from highly-infectious variants of Covid-19 spreading through poor countries where vaccination rates are lower, the International Monetary Fund has warned, reports our economics writer Phillip Inman.

Calling on rich countries to take urgent action to share at least a billion doses with developing nations, or risk severe economic consequences, the Washington-based fund said the gap between rich and poor economies had widened during the pandemic and risked worsening further next year.

A speedy rollout of vaccines has improved the economic outlook in wealthier countries, including the UK, while a lack of resources to improve vaccination rates and support the re-opening of their economies has depressed growth rates across low income countries.

Setting out the downside risk scenario in its six-monthly health check of the global economy, the IMF said the emergence of highly-infectious strains of coronavirus would wipe $4.5tn from global GDP by 2025 with the potential for more than two thirds of that loss falling on middle and low-income countries.

US stock futures have moved lower again, indicating declines of 0.2% to 0.3%, after weaker-than-expected US durable goods data.

New orders for manufactured durable goods in June increased by 0.8% to $258bn, the US Census Bureau announced a few minutes ago. Economists had pencilled in a 2.1% increase.

This increase – orders have risen in 13 of the last 14 months – followed a 3.2% gain in May. Excluding transportation, new orders increased 0.3%. Excluding defence, orders increased by 1%. Transportation equipment, up for two consecutive months, led the increase, by 2.1% to $77.5bn.

The Yorkshire speciality chemicals company Croda is the top FTSE 100 riser today, up nearly 7% to a record high of £83.70. It upgraded its full-year profit outlook, as sales in the first six months of 2021 climbed 39% to £934m, helped by demand for lipid components used in Covid-19 vaccines and treatments.

Croda makes ingredients for products ranging from beauty products to plastics and its life sciences arm supplies Pfizer and BioNTech with the lipid nanoparticles needed to make their coronavirus vaccine. They act as a delivery mechanism for the mRNA jab. (In a smart move, Croda acquired the lipid nanoparticles business when it bought the US firm Avanti last summer.)

Croda’s profit before tax rose almost 41% to £204m in the first half. The firm is working on more than 100 Covid-19 projects in 20 countries and expects lipid component sales to top $200m (£145m) this year.

Renewable energy giant Scottish Power has completed its first onshore wind farm for five years – with a little help from Tesco. The subsidy-free Halsary wind farm was built in the highlands by Scottish Power in partnership with the grocery chain which has agreed to buy 100% of its clean electricity, reports our energy correspondent Jillian Ambrose.

The wind farm’s 15 turbines are now generating enough clean energy to power the equivalent of almost 20,000 homes and will help power Tesco’s 3,000 store, warehouses and electric vehicles across the country.

Tesco is the UK’s biggest corporate energy buyer, typically using around 1% of the UK’s total electricity generation, but set a target in 2017 to source 100% of its power from renewables. The retailer has already met its target using renewable energy bought via ‘green energy certificates’ but plans to invest directly in new renewable energy projects too to help make the UK’s electricity system greener.

UK retail sales in July were slightly better than expected, according to the CBI’s latest monthly survey. Sales continued to grow at a rate well above the long-run average in the year to July, while orders grew at the fastest pace since December 2010.

Retail sales grew at a similar pace as in June (+23% vs +25%), while orders grew at the fastest pace since December 2010 (+49% from +30%). Sales are expected to grow at a faster pace (+29%) and orders at a slower pace (+39%) next month. The percentage balances measure the number of retailers saying sales or orders grew minus those reporting a decline.

However, stock levels are at a record low and firms have been hampered by shortages of workers. And internet sales were flat in July (after shops reopened) – the weakest outturn since the question was first asked in August 2009. Retailers expect internet sales to pick up next month, but growth is set to remain well below the long-run average.

Ben Jones, principal economist at the CBI, says:

Consumer demand continues to support the UK’s economic recovery. Retail sales have been at or above seasonal norms for the last four months now, although this picture is not universal, with the clothing and footwear stores in particular yet to see demand recover to usual levels.

While demand may be more stable, operational issues worsen. Relative stock levels are at a record low and expected to fall further still, while the number one worry for many firms at the minute is labour shortages throughout the supply chain as staff self-isolate.

Following on from property website Zoopla’s strong house price figures this morning... The property group Savills has more than doubled its 2021 house price forecast to 9% from 4%, which was made before the extension of the stamp duty holiday to the end of June. In the first half of the year, property values rose by 5.6% on average, according to Nationwide building society.

Savills is predicting further growth of 3.5% next year and a total of 21.5% growth in the five years to the end of 2025, which is set to take the average house price above £280,000, an average gain of £50,000.

Lucian Cook, Savills head of residential research, says:

Some of the growth generated by the extraordinary market conditions of 2020 and 2021 could unwind at times during 2022, but we see nothing on the horizon that would trigger a major house price correction.

New buyer demand continues to outweigh supply despite the potential stamp duty saving falling from £15,000 at June 30 to just £2,500 until the end of September, and this against low levels of supply.

This imbalance looks set to continue, underpinning further price growth over the near term, particularly as people look to lock into current low interest rates. But such strong growth in 2021 will leave less capacity for growth over the next few years, particularly as interest rates are expected to rise a little earlier than leading commentators had previously projected.

The rate at which interest rates rise will also shape price growth. A steeper than anticipated jump in rates would restrict growth, although it would have to be severe to lead to actual falls in values – an outside risk in our view.

The European Union is on track to achieve its target of fully vaccinating at least 70% of its adult population by the end of the summer. The European Commission said that percentage of people over 18 has now received at least one dose, while 57% have received both jabs.

However, in Australia, where vaccine rollout has been slow, the former prime minister Malcolm Turnbull has described it as a “colossal failure”. He told the BBC that the government failed to buy enough vaccines and Australia’s borders are likely to remain closed until at least early next year.

Games Workshop, which makes its fantasy figures in Nottingham, its main base, has also fared well as people were stuck at home during the pandemic. Sales grew 31% in the year to 30 May, to £353m, with profit before tax soaring from £89m to £151m, despite all the pandemic disruption which forced its 523 shops to close for months.

The firm has paid its staff a £10.6m bonus. It said new releases for Age of Sigmar and the Cursed City game sold out very quickly.

Kevin Rountree, the chief executive, says:

After a tough year we are delighted that the Warhammer hobby and Games Workshop are in great shape.

Our ambitions remain clear: to make the best fantasy miniatures in the world, to engage and inspire our customers, and to sell our products globally at a profit. We intend to do this forever. Our decisions are focused on long-term success, not short-term gains.

The company has bought more land next to its main factory in Nottingham to expand production.

China’s sweeping crackdown on companies ranging from education firms to the technology sector is fuelling a sell-off in global stock markets. Over the weekend, Beijing banned academic tuition groups from making profits, raising capital or going public. Hong Kong’s Hang Seng took a late dive, tumbling nearly 5%, while the Shanghai Composite Index closed down 2.5%.

• UK’s FTSE 100 index down 95 points, or 1.4%, at 6,930
• Germany’s Dax down 146 points, or 0.9%, at 15,474
• France’s CAC down 38 points, or 0.6%, at 6,539
• Italy’s FTSE MiB down 245 points, or 1%, at 25,048

In Hong Kong, the first person charged and tried under its national security law has been found guilty of terrorism and inciting secession by a panel of three judges.

The landmark case before Hong Kong’s high court came more than a year after the law – imposed by Beijing with the blessing of the city’s leadership – was implemented, despite global condemnation of its content.

Reckitt Benckiser, the maker of Dettol and Cillit Bang, is the biggest faller on the FTSE 100, with the shares down more than 9%, after its second-quarter sales came in worse than expected. Like rival Unilever, the company is being squeezed by rising commodity costs, which will force it to put up its prices.

Reckitt’s chief executive Laxman Narasimhan said:

Cost inflation accelerated in the second quarter and it will take time to offset this headwind with productivity and pricing actions being implemented in the back half of the year and early next year.

Unilever, which makes household brands including Dove shampoo, Domestos bleach and Hellmann’s mayonnaise, also warned last week that the big jump in the price of commodities such as crude, palm and soya bean oil, as well as higher transport and packaging costs, was eating into its profitability.

Reckitt moved into a pre-tax loss of £1.9bn in the first half of the year, against a profit of £1.4bn a year earlier, partly because of a £3bn charge related to the sale of its baby formula business in China.

Sales and profits have more than doubled at Moonpig, the online greetings card and gift retailer, which has today reported its first results since listing on the stock market, after benefitting from lockdown spending during the pandemic.

Revenue rose by 113% to £368m in the year to 30 April, compared with a year earlier, which it said was a result of people shopping more often, as well as new customers making purchases. Moonpig acquired triple the number of customers during the pandemic than in a normal year. Mother’s Day broke all records, beating a very strong Valentine’s Day during the last Covid-19 lockdown.

However, its share price fell 6.3%. The overall FTSE 100 index is down nearly 1%.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

FirstGroup, the Aberdeen-based rail and bus operator, has announced that its chief executive Matthew Gregory intends to step down after its annual meeting, in a victory for shareholders. Chairman David Martin will run the firm as interim CEO while it looks for a permanent replacement.

FirstGroup’s biggest shareholder, a US hedge fund, had demanded the resignation of the transport firm’s chief executive and two board members, after failing to prevent the sell-off of its American businesses.

Coast Capital, the New York-based hedge fund which owns about 15% of the group, had opposed the $3.1bn sale of the FirstStudent and FirstTransit businesses to Swedish group EQT, arguing the price was too low for the school and city bus services.

Meanwhile, UK house prices hit a new high of £230,700 in June and are now 30% higher than the peak they hit before the 2008 financial crisis, according to the property website Zoopla.

European stock markets have started the week cautiously, pressured by a downbeat Ifo business survey for Germany and concerns over rising Delta infection rates. Cases in the UK remain much higher but continue to fall, for the sixth da in a row. On Tuesday, the FTSE 100 index fell 30 points, or 0.4%, at the open to 6,694 while European shares also headed lower.

On Wall Street, the S&P 500 and the Nasdaq set fresh record highs on Monday despite a fall in US new homes sales. Microsoft and Apple are expected to report positive results later today.

In Asia, most stocks followed the US lead on Tuesday, with Japan’s Nikkei nearly 0.5% ahead and the Australian market up 0.4%. Chinese and Hong Kong stocks tumbled after a regulatory crackdown in Beijing. Also, data from China showed industrial profit growth slowed to 20% year-on-year in June. The Shanghai Composite Index fell 2.5% while Hong Kong’s Hang Seng lost 3.4%.

Michael Hewson, chief market analyst at CMC Markets UK, explains:

Concerns about over-reach by Chinese regulators saw equity markets get off to a cautious start yesterday. The clampdown on various sectors within the Chinese economy that rely on overseas investment has seen a flight of capital out of Chinese stocks, particularly those with overseas listings, raising concerns as to what other sectors might be next. This caution has continued in Asia markets this morning with the Hang Seng sinking to a nine-month low.

[In the US:] With Microsoft and Apple expected to post some bullish earnings numbers later today, expectations are high that even with today’s decent results already priced in, and there’s little doubt that they are, in the absence of other alternatives, any dips are likely to be bought into.

Also coming up

In a quiet week for UK economic data, the highlight today is the release of the CBI’s latest retail sales survey for July. This will provide an update on retail sector activity at the start of the third quarter following June’s moderate growth of 0.5% reported in the official retail sales figures last Friday.

As the US Federal Reserve’s latest meeting gets underway in Washington DC, we get US consumer confidence numbers for July, which are expected to ease a bit from June’s peak of 127.3. Investors are waiting for further clues on when US stimulus might start winding down, when Fed chair Jerome Powell holds a press conference at the end of the meeting on Wednesday evening.

Danielle DiMartino Booth of Quill Intelligence says:

We expect Jay Powell to reiterate that the tapering discussion is underway, but that it’s too soon to reveal a specific date.

The Agenda

• 9.30am BST: UK trade data
• 11am BST: UK CBI retail sales survey for July (forecast: 21)
• 1.30pm BST: US Durable gods orders for June (forecast: 2.1%)
• 2pm BST: US House prices for May
• 3pm BST: US Conference Board Consumer confidence for July (forecast: 123.9)