Time to wrap up...

Britain’s ongoing labour squeeze is continuing in the run up to Christmas, as firms continue to struggle to fill vacancies. The number of active job postings at UK firms hit 2.68 million in the first week of November, a record high, with another 221,000 ads were added during the week.

Roles being advertised for driving instructors, prison officers, fork-lift truck drivers, secondary school teachers, care workers and goods packers all saw big increases, while vacancies for painters, roofers and carpenters fell as builders were hit by supply shortages.

In the US, consumer confidence has slumped to its lowest level in a decade, as rising inflation hit confidence.

But workers are also quitting their jobs at a record pace, at a time when firms are competing for staff.

Pressure is mounting over Bain Capital’s proposed £530m takeover of LV=. Campaigners are concerned that the deal for the pensions and life insurance mutual will mean worse payouts for customers and poorer customer service. MPs fear another private equity asset-stripping.

And this evening, we’ve reported that the Conservative party’s new treasurer could make millions of pounds from the controversial takeover of the pensions and insurance mutual LV= by an American private equity firm.

AstraZeneca has started signing commercial contracts to supply its Covid-19 vaccine next year as the pandemic moves to an “endemic phase” – in a major shift away from the drugmaker’s not-for-profit pricing.

Britain’s blue-chip FTSE 100 index fell around 0.5%, dragged down by AstraZeneca which missed earnings forecasts, hospitality firms, and a stronger pound today.

European markets closed at fresh record highs, despite new lockdowns measures being announced in Austria and the Netherlands.

Eurozone industrial output fell again, down 0.2% in September.

With supply chain problems still intense, the EU’s competition chief has warned that Europe and the US must avoid being dragged into a ‘subsidy race’ in the struggle to get hold of computer chips

Johnson & Johnson has become the latest major company to announce it will split. It will spin off its consumer products division into a new company as it focuses on pharmaceuticals and medical devices.

Elon Musk has continued to cut his stake in Tesla, selling almost $700m of shares yesterday.

Logistics workers are processing mountains of parcels after Chinese e-commerce titan Alibaba has enjoyed record sales during its Singles Day shopping extravaganza.

The energy regulator has threatened to strip five suppliers of their licences after they failed to hand over more than £500,000 collected from customers’ bills to help pay for a renewable energy support scheme.

Women who work mostly from home have been warned they risk hurting their careers and getting caught in a “she-cession” as more men return to office working post-pandemic .

And Bake Off’s coming back again, after Channel 4 struck a new deal to keep the hit show for three more years.

Goodnight, and have a lovely weekend. GW

The Conservative party’s new treasurer could make millions of pounds from the controversial takeover of the pensions and insurance mutual LV= by an American private equity firm.

The proposed buyout has enraged some Conservative MPs – and could put them at odds with Malik Karim, an investment banker, who was named Tory treasurer in September, responsible for building the party’s election war chest.

Conservatives see the takeover as another sale of a cherished British mutual institution, and it has drawn the wrath of former Conservative deputy prime minister Michael Heseltine.

Karim is the founder and chief executive of City investment bank Fenchurch Advisory Partners, LV=’s longstanding financial adviser. Fenchurch is believed to have made millions of pounds of fees by advising the member-owned firm on its gradual dismemberment in recent years.

Karim, a Tory donor who earns the lion’s share of Fenchurch’s profits, stands to make one last payday by advising LV= on its £530m sale to Bain Capital – the US private equity giant that was co-founded by Republican Mitt Romney.

But the deal has provoked outrage because it will end LV=’s status as a member-owned firm after 178 years, hand a paltry payout of about £100 to each of its 1.2m members, and has led to fears over asset stripping.

It has whipped up a political storm among MPs, by placing another British institution into US private equity hands. Karim’s involvement is likely to further anger Tory MPs, who are reeling after a string of revelations about standards in public life.

LV= refused to say what it will pay Fenchurch. Advisers on other insurance buyouts have made millions of pounds in fees.

Here’s the full story:

European shares closed their sixth straight week of gains at a new high on Friday, as strong results from Cartier owner Richemont rounded off a robust earnings season, reports Reuters:

The pan-European STOXX 600 index rose 0.3% to a new peak of 486.75 points, and added 0.7% for the week. It has finished at record highs in four of the five sessions this week.

Richemont surged 10.9% and was the best-performing European stock for the day, after it beat six-month profit estimates and said it was seeking investors for its loss-making Yoox business.

The luxury sector also got a boost from France’s LVMH, which gained 2.5% on news that Louis Vuitton was planning to open its first duty-free store in China.

In the City, the FTSE 100 has ended the day down 36 points or 0.5% at 7348 points.

After hitting a 20-month high yesterday, the blue-chip index couldn’t repeat the feat. AstraZeneca pulled it down, closing 6.8% lower after missing earnings expectations this morning.

Travel and hospitality shares also had a weak day, after Austria announced a lockdown for unvaccinated people in two of Europe’s worst-hit coronavirus regions, and the Netherlands announced a partial lockdown will begin tomorrow.

Airline group IAG fell 2.8%, hotel operator Whitbread lost 2.3% and catering group Compass lost 2.1%.

On the smaller FTSE 250, cruise operator Carnival fell 3.9% and package holiday group TUI lost 3.3%.

France’s CAC had a stronger day, though, hitting an all-time high, while Germany’s DAX was flat.

U.S. consumer sentiment has plunged to the lowest level in a decade this month, as surging inflation cut into households’ living standards.

The University of Michigan’s Consumer Sentiment Index has tumbled to 66.8 in its preliminary November reading from October’s final reading of 71.7. That was the lowest level since November 2011, and weaker than expected

It shows that the jump in prices this year, which has driven US inflation to a 31-year high of 6.2%, is worrying consumers.

Marketwatch explains:

Americans’ sentiment worsened due to escalating inflation and the growing belief that no effective policies have yet been developed to reduce the damage from it, said Richard Curtin, the survey’s chief economist.

Rising prices for homes, vehicles and durables were reported more frequently than any other time in more than half a century, he said.

Consumer confidence hints at Americans’ willingness to spend on goods and services, which is a major driver of the U.S. economy. However, although confidence has remained at subdued levels in the last few months, U.S. consumers haven’t shown signs of a severe retreat in spending.

Here’s some reaction:

Workers in the US quit their jobs at a record pace in September.

Around 4.4m people voluntarily left their jobs during the month, the Labor Department reports, lifting the quits rate to 3.0% -- which are record levels since the survey began.

There were 10.4m job openings during the month, close to the record highs seen this summer, as firms continue to struggle to hire workers (as we’ve seen in the UK today too)

The report says:

The number of quits increased in September to a series high of 4.4 million (+164,000).

The quits rate also increased to a series high 3.0 percent. Quits increased in several industries with the largest increases in arts, entertainment, and recreation (+56,000); other services (+47,000); and state and local government education (+30,000). Quits decreased in wholesale trade (-30,000). The number of quits increased in the West region.

Nick Bunker, economist at jobs site indeed.com, has more rapid analysis:

Johnson & Johnson plans to split into two companies, separating its consumer health division that sells Band-Aids and Baby Powder from its pharmaceuticals and medical devices business.

It’s the biggest shake-up in the company’s 135-year history, just days after another US titan, General Electric, announced it would split in three.

Johnson & Johnson plans to separate its consumer health business into a new publicly traded company, and will focus on pharmaceuticals and medical devices.

J&J says the new consumer health company would be “a global leader with iconic brands and products that touch over one billion lives every day”, such as Neutrogena, AVEENO, Tylenol, Listerine, JOHNSON’s, and BAND-AID.

Alex Gorsky, J&J’s chief executive, said:

Following a comprehensive review, the Board and management team believe that the planned separation of the Consumer Health business is the best way to accelerate our efforts to serve patients, consumers, and healthcare professionals, create opportunities for our talented global team, drive profitable growth, and – most importantly – improve healthcare outcomes for people around the world.”

Gorsky adds that splitting the businesses makes sense -- rather than keeping two diversified entities within one corporation.

We believe that the new Johnson & Johnson and the New Consumer Health Company would each be able to more effectively allocate resources to deliver for patients and consumers, drive growth and unlock significant value.

J&J’s consumer arm has faced tens of thousands of claims that its baby powder and other talc-containing products caused mesothelioma and ovarian cancer.

It put thousands of those claims into a newly created subsidiary this autumn, which it then placed into bankruptcy in a controversial legal strategy known as the Texas Two Step.

Elon Musk has sold more of his stake in Tesla.

New SEC filings (here and here) show that the Tesca CEO’s trust sold 639,737 shares on Thursday.

That’s on top of the 4.5m share sales, worth $5bn, reported on Wednesday which lowered his stake by around 3%.

These latest shares were sold in a series of transactions at between $1,056 and $1,104, which I think has raised roughly $687m (based on the reported transaction sizes and prices).

This follows Musk’s poll last weekend, in which Twitter users voted that he should sell 10% of his Tesla stake.

This latest sale leaves Musk’s trust owning nearly 167.5m shares in the company, the filing says.

That suggests the 639,737 shares sale cuts his stake by under 0.5%, meaning Musk would need to sell more shares to hit the 10% target

Tesla’s shares have fallen around 13% so far this week, from $1,221 last Friday night to $1,063 by Thursday’s close.

The Chinese e-commerce titan Alibaba enjoyed record sales during its Singles Day shopping extravaganza, giving a much-needed boost to the firm after a torrid year in which it became the symbol of a government crackdown that hammered the country’s tech sector.

The firm said 540.3bn yuan (£63bn) was spent as China’s army of consumers went on a splurge despite a more low-key sales campaign after pressure from the government to tone down the aggressive promotions and rampant consumerism.

Combined sales with its industry rival JD.com came in at 889bn yuan, which was also a record and up about a fifth from last year.

Alibaba and JD.com reported strong sales of items such as electric appliances, electronics, pet supplies, and cosmetics and other personal-care goods.

JD.com shares rose more than 4% in Hong Kong on Friday, although Alibaba was down more than 1%.

Singles Day – so-called for the 11.11 date – began more than a decade ago and for years was a one-day, 24-hour event on 11 November.

However, industry players expanded it recently into an extended promotion from 1-11 November, with many retailers and platforms offering discounts and pre-sales even earlier... More here:

This surge of orders has meant delivery workers have been sorting through masses of packages....

The EU’s competition chief has warned that Europe and the US must avoid being dragged into a ‘subsidy race’ in the struggle to get hold of computer chips.

In a speech to Belgium’s Katholieke Universiteit Leuven this morning, EU Competition Commissioner Margrethe Vestager warned that the serious shortage of semiconductors is threatening to destroy company profits and undermine their recovery.

Vestager said there were several causes of the shortage (according to a copy of her speech on the Commission’s website):

From the increase in demand coming from home-stay during the pandemic; to the geopolitical tensions leading to hoarding of supplies, notably in China; to the business decisions of some companies to cancel supply contracts, only to find themselves at the back of the queue when demand picked up.

And she cautions against a subsidy race, saying it would leave everyone worse off.

In the current circumstances, it becomes tempting for companies to try to play out governments against each other, scanning the landscape to see who would be willing to pay more. This risks letting taxpayers – whether European or American – pick up the bill, and get little from it.

Those chip shortages have hit car production around the world, with UK output hitting its lowest since the 1950s in July. Even Apple, with its huge financial muscle, has warned that supply chain shortages are hitting its output.

AstraZeneca has sold more than $2.2bn (£1.64bn) of its Covid-19 vaccine in the first nine months of this year, as the drugmaker said it is set to move to “modest profitability” as new orders are received.

Britain’s biggest drugmaker has so far promised to provide the jab, which it developed with Oxford University, on a not-for-profit basis through the pandemic.

“The company is now expecting to progressively transition the vaccine to modest profitability,” it said in its third-quarter results this morning.

“Covid‑19 vaccine sales in the fourth quarter are expected to be a blend of the original pandemic agreements and new orders, with the large majority coming from pandemic agreements.”

Earlier this week the Anglo-Swedish drugmaker confirmed it will create a vaccines unit as it plans for the future of its coronavirus shot beyond the pandemic. The company said the reorganisation would bring together people who had previously been based in different parts of the business, and will be dedicated to the Covid-19 vaccine and tweaked versions to deal with new variants of Sars-CoV-2.

AstraZeneca said it intends to start including the revenue and profit of sales of the pandemic vaccine in its future financial guidance and in results on Friday there would be a “limited profit contribution” in the final three months of the year.

The company said the contribution would offset costs relating to its long-acting antibody combination AZD7442, and has not changed its earnings guidance for investors.

AstraZeneca’s third-quarter revenue rose by 50% to $9.8bn, boosted by the addition of Alexion, the US drugmaker for rare disease acquired earlier this year, and were up 32% excluding the vaccine.

But adjusted earnings per share came in at $1.08, below average analyst estimate of $1.24.

Despite the UK’s tight labour market, there are concerns that women who work mostly from home risk seeing their careers suffer.

Bank of England policymaker Catherine Mann warned that with significant numbers of workers returning to the office, those who stay away risk their careers suffering -- as a ‘two track’ workplace develops.

While online communication is much better than before the pandemic, it still can’t replace the spontaneous office conversations which can lead to recognition and advancement in many workplaces, argued Mann, a member of the BoE’s Monetary Policy Committee.

Yesterday she told an event for women in finance hosted by the newspaper Financial News that:

“Virtual platforms are way better than they than they were even five years ago. But the extemporaneous, spontaneity - those are hard to replicate in a virtual setting.

And with difficulties accessing childcare and Covid-related disruption to schooling continuing, Mann fears that this means many women will continue to work from home, while men returned to the office:

“There is the potential for two tracks. There’s the people who are on the virtual track and people who are on a physical track. And I do worry that we will see those two tracks develop, and we will pretty much know who’s going to be on which track, unfortunately.”

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

Britain’s ongoing labour squeeze is continuing in the run up to Christmas, as firms continue to struggle to fill vacancies.

The number of active job postings at UK firms hit 2.68 million in the first week of November, a record high, according to the Recruitment and Employment Confederation (REC) this morning.

Growth in job adverts shows “no signs of slowing down in the build up to Christmas”, REC says, despite concerns about increases in the cost of living and the persistent presence of COVID-19.

Another 221,000 ads were added during the week - the fourth highest weekly figure since the start of 2020. It highlights that the worker shortages that have hampered the UK’s recovery have not eased, as growth slows over the summer.

Driving instructors saw the biggest jump in adverts, up over 32% week-on-week, followed by prison officers (+13.0%), and fork-lift truck drivers (+9.1%).

Adverts for secondary school teachers rose 9.1% with fitness instructors (+7.7%) and care workers and home carers (+7.1%), also in demand.

Hospitality firms are also struggling to hire, with ads for bar staff (+3.2%), chefs (+3.1%) and waiters and waitresses (+2.7%) up again.

These vacancies could give workers the upper hand in pay negotiations -- at a time when the cost of living squeeze is hitting families.

But there were “notable fall in adverts for construction sector roles”, where shortages of raw materials have been hitting the sector. Ads for painters and decorators fell 17.8%, along with roofers (-13.4%), and bricklayers (-11.3%).

Neil Carberry, chief executive of the REC, says:

“The latest job advert numbers show recruitment activity staying strong in the run-up to Christmas. The general positive trend varies by region and sector, however. London has been affected more than other areas by the rise of hybrid working, and its jobs market continues to grow at a slower pace than the rest of the UK.

And while roles in logistics and care are in high demand, the construction sector saw a drop-off last week as supply issues constrained the industry’s ability to work to capacity.

UK’s top hiring hotspot last week was Telford and Wrekin (+19.4%) followed by South Teesside (+13.9%).

But the East of England lagged - with three of the bottom ten local areas for growth: Breckland and South Norfolk (-3.6%), North and West Norfolk (-2.4%), and Bedford (-2.2%).

European stock markets are set for a flat open.

Yesterday, the FTSE 100 closed at a 20-month high, after strong results from AutoTrader, with mining giants lifted by relief that property developer China Evergrande averted a default.

The US dollar is on track for its best week in almost five months, after America’s inflation rate hit a three-decade high this week, raising pressure for the Federal Reserve to raise interest rates. Gold could post its best week in six months.

The agenda

• 10am GMT: Eurozone industrial production for September
  
• 3pm GMT: University of Michigan consumer sentiment index
• 3pm GMT: JOLTS survey of US job openings