Time to wrap up…

Thames Water said it has received six takeover offers from potential suitors to buy the company, and that talks are ongoing.

The company hopes to agree a deal by the end of June, and complete it by the end of September.

Its appeal to lift customers bills by more than regulators allowed has been paused while talks continue, but the CMA will consider appeals by five other water companies.

Geopolitical tensions have pushed the gold price to a new all-time high of $3,038 per ounce. Analysts said the weaker dollar, and fears of a global trade war, were fuelling a new gold rush.

The dollar has recovered ground this afternoon, after slipping to a four-month low which saw the pound trade at $1.30 for the first time since November.

Bosses at the publisher of the Mirror, Express and Star newspapers took home more than £2m in pay and bonuses last year, angering staff who were awarded a few hundred pounds each following a boost in profits last year.

Jim Mullen, the chief executive of Reach, the owner of more than 100 news brands including the Manchester Evening News, the Birmingham Mail and the Liverpool Echo, received total remuneration of £1.25m last year.

His pay packet was sweetened by a maximum bonus of £662,000 after the company boosted operating profit by 6% to £102m last year.

According to Reach’s annual financial report Mullen was paid 35 times that of an employee in the 25th percentile, the lower end of the company’s pay structure.

Darren Fisher, Reach’s finance chief, received £857,000 including a £378,000 bonus.

Following deep cuts affecting more than 800 staff Reach struck a deal to boost employee pay by 5% last year, and a £600 bonus payment this month as part of the company’s profit share scheme.

Management is currently in negotiations with the National Union of Journalists over a proposed 2% increase this year, while any increase in the base salary of Mullen and Fisher will be decided on 1 April.

The NUJ said that in light of the publication of top executive pay Reach should reconsider its pay offer.

“It is good news that the business has turned around its key digital revenues and has improved its operating profits out of which these bonuses will be paid,” said Reach’s NUJ chapel.

“But this was done on the back of heroic efforts by employees to dramatically increase the number of stories going online and by those in print outperforming the market with threadbare resources thanks to significant redundancies.”

Donald Trump appears to have triggered a stampede out of the US stock market.

Bank of America’s March Global Fund Manager Survey has found there was a record rotation out of US stocks by fund managers this month, as investor sentiment was hit by fears of a trade war and possible US recession.

BofA reports there has been a “bull crash” in fund manager sentiment this month, with March seeing the second biggest drop in global growth expectations ever, the biggest drop in US equity allocation ever, and the biggest jump in cash allocation since Marcn 2020.

This is reflected in market prices this year – the S&P 500 share index is down 4.5% during 2025, while Europe’s Stoxx 600 has jumped 9%.

Back in the financial markets, the US dollar has shaken off its earlier losses – pulling the pound down to $1.296.

Gold, though, is undaunted, and has now touched a new all-time high of $3,038 per ounce, up 1% today, thanks to a cocktail of Middle East tensions, US trade war fears, and the ongoing scamper into safe-haven assets.

The news that Thames Water has received six takeover proposals since last summer comes as regulator Ofwat asks the competition watchdog to consider requests from several other water companies to lift their bills even higher than has been allowed.

Ofwat is referring redetermination requests from Anglian Water, Northumbrian Water, South East Water, Southern Water and Wessex Water to the Competition and Markets Authority (CMA).

The five companies are all challenging Ofwat’s ruling last year about how they can raise their bills between 2025 and 2030, arguing that the increase – 36% on average across the industry – wasn’t enough to invest in pipes, drains, reservoirs and treatment works.

Ofwat defends its decisions, saying:

The increase in investment means that customers’ bills will increase from 1 April; many customers are already expressing concerns about the level of increase.

While the companies have not yet set out the details of their reasons for appealing, their initial statements highlight the need for additional funding beyond the substantial increase already allowed. This would mean a further increase in bills for customers.

Interestingly, the regulator has also agreed a request from Thames Water to defer its referal to the CMA for up to 18 weeks. That delay, Thames says, will give it time to potentially “unlock a market-led solution for the recapitalisation of the Company” (presumably through one of the six offers on the table).

Thames Water has revealed it has received six approaches from potential suitors.

The struggling utility, which has been on the verge of collapse for months, says it has received proposals from six parties in response to a fundraising process launched in 2024, and that it “has since been conducting a detailed assessment of each proposal”.

Thames says that many of the proposals included its bond holders taking a hit:

The proposals involve a range of potential valuations, structures and outcomes for stakeholders. Of the five proposals that provided financial metrics, all except one (from a Class B Creditor and with significant conditions attached) indicated a material impairment of the Class A debt.

The sixth proposal was for minority equity, intended to partner with investors, and did not set out financial metrics.

In certain of the contemplated proposals, relevant creditors would receive – in exchange for debt impairment – certain rights to share in future growth in the value of the Company, and/or will have the ability to co-invest in the business.

Thames adds that most of the proposals are conditional on the company achieving various “regulatory support and accommodations” – a nod to its financial and operational problems, from a £19bn debt pile to crumbling infrastructure.

It explains:

Discussions with relevant parties are ongoing, although there is no certainty that a binding equity proposal will be forthcoming or that any such proposals will be capable of being implemented. As a result, certain senior creditors continue to progress in parallel alternative transaction structures to seek to recapitalise the business.

Thames does not name any of its suitors.

But in December, the company received a £5bn bid from infrastructure investor Covalis Capital.

News of the six takeover approaches comes a day after the UK court of appeal has upheld an emergency debt package worth up to £3bn. That debt should keep Thames operating for a few months while efforts to recapitalise it are progressing.

The Guardian reported last week that Thames Water is asking to be spared billions of pounds of costs and fines over the next five years and heap more on to bills so it can attract new investors.

The company is hoping to persuade the regulator Ofwat to grant it significant leniency on penalties and extra costs, to help woo bidders.

South Yorkshire has become the latest combined authority to announce it will take buses into public control.

Mayor Oliver Coppard has followed his fellow metro mayors in the north in deciding to pursue bus franchising to improve local services.

Today’s decision came after a public consultation in which the authority said nearly 90% of 7,800 respondents backed local authority control of buses.

South Yorkshire will, like Greater Manchester, West Yorkshire and Liverpool, now take control of the bus network - including depots and vehicle fleets, and setting routes, timetables, ticketing and fares. Buses are expected to operate under the new system from September 2027.

Coppard said the move was “turning back the tide on the failed experiment of the privatisation of our bus network that was started in the 1980s, putting the public back into public transport.”

He added:

“Over the last forty years we’ve seen public transport taken apart; fares go up, routes and passenger numbers go down, and our city centres, our high streets and our economy flatline.

“I want us to build a bigger and better economy in South Yorkshire and we need a public transport system that allows people to get to where they want to go, when they want to go there.

“The destination is a fully integrated transport system across Barnsley, Doncaster, Rotherham and Sheffield, one that works in the interests of our communities and our economy, putting people back in control of essential services.”

It is expected to have new branding, covering buses and trams and other public transport, much like Manchester’s Bee Network.

Google is reportedy poised to make its biggest acquisition ever – posing a test for competition regulators.

Google parent Alphabet has agreed to buy cyber security start-up Wiz for at least $32bn, the Financial Times is reportiing, with an announcement expected today.

Wiz, which offers a service that scans the data on cloud storage providers such as Amazon Web Services and Microsoft Azure for security risks, was founded by alumni of Israel’s elite cyber intelligence unit in 2020.

It rejected a $23bn offer from Google last year, and recently opened its European headquarters in London.

The FT says:

The all-cash deal, which will rank as the biggest deal of the year so far, will be announced on Tuesday morning, the people said. It will probably still face scrutiny from the Federal Trade Commission under President Donald Trump, whose new chair Andrew Ferguson has maintained guidelines giving the agency the ability to block large deals used by his predecessor Lina Khan. There will be an additional retention bonus offered to employees as part of the deal, which could be worth an extra $1bn, the people added.

More here: Google parent Alphabet agrees to buy cyber security group Wiz for $32bn

Trade between Europe and the United States accelerated in January, as firms on both sides of the Atlantic raced to avoid a new trade war.

New data from eurostat shows that European Union exports to the US rose by 16% year-on-year in January, to €46.7b, while shipments the other way rose by 7.5% to €30.5bn.

That swelled the EU’s trade surplus with the US to €16.2bn, up from €11.9bn in January 2024.

In contrast, Europe’s trade deficit with China ballooned to €30.1bn, from €20.6bn, due too a drop in exports and a rise in imports.

Analysts at ING say “some tariff war anticipation effects can be seen in the US trade data”, adding:

The outlook for 2025 is highly uncertain due to the trade war, despite new export orders finally showing signs of bottoming out.

Last week, Donald Trump imposed 25% tariffs on steel and aluminium imports, including from the EU, and is threatening a 200% tariff on wine and champagne from European Union countries unless the EU’s retaliatory 50% levy on American bourbon whiskey is dropped.

The EU also faces the threat of new reciprical and sectorial tariffs being imposed by the US in early April.

Britain’s accounting watchdog is investigating accountancy firm MHA for its audit of the collapsed construction company ISG, in a blow to MHA’s hopes to raise £125m through a stock market flotation.

The Financial Reporting Council said it had begun an investigation of MHA’s audit of IGS’s accounts for 2022. The construction firm, which held more than £1bn of government contracts, fell into administration last September, and 2,200 workers lost their jobs. IGS, which built the velodrome for the 2012 London Olympics, had been struggling financially for some time and failed to secure a rescue deal.

Neil Hallsworth from Nottingham, who worked for ISG as a project manager for more than 15 years, told the BBC at the time that he was “gutted” and that some of the contractors were “owed a fortune”.

It was the biggest collapse in the construction sector since Carillion’s failure in 2018, and forced government officials to look for other contracts to take over ISG’s projects, including prisons upgrades and work to school buildings.

The FRC investigation into MHA’s audit comes just a day after it announced plans for a public listing to raise up to £125m, including a £6m offer to small investors. On Monday, the accounting firm, which is the UK arm of the international network Baker Tilly, said it planned to float on London’s junior market Aim in the coming weeks to raise money for technology investments such as AI and the company’s expansion. It employs 43,515 people in 143 territories and made worldwide revenues of $5.6bn last year.

MHA also said it is looking at buying up other Baker Tilly firms.

Today, the firm said:

“MHA is committed to audit quality and we will be co-operating fully with the FRC as part of this investigation.”

Sterling is also having a good morning against the weakening US dollar.

The pound has traded at $1.30 for the first time since early November (just before Donald Trump’s election win sparked a dollar rally).

The dollar is generally weaker again today, due to uncertainty over trade tariffs and concerns that the US economy is weakening.

Expectations that sticky inflation will make it hard for the Bank of England to cut interest rates this year are also supporting the point, Bloomberg reports, adding:

By year-end, traders see the BOE lowering borrowing costs by 51 basis points, less than the 60 basis points expected from the Federal Reserve. The US central bank also meets this week and is forecast to keep rates at 4.5%.

[51 basis points would imply two rate cuts in the UK this year, with very little chance of a third, while 60bps implies that a third cut in the US is a possibility].

The BoE and the Fed both set interest rates later this week – neither is expected to cut, though.

Gold is continuing to hit new heights this morning – it’s now trading at $3,027 per ounce.

Oil is trading near a two-week high this morning, with Brent crude up 1% at $71.73 per barrel.

Matt Britzman, senior equity analyst at Hargreaves Lansdown, reports that concerns over supply disruptions due to ongoing conflicts in the Middle East are lifting oil, adding:

Israel’s large-scale attack on Gaza and President Trump’s threats against Iran have added to the uncertainty, while expectations of increased demand from China, fuelled by stimulus plans and strong economic data, are acting as another tailwind.“

In the City, shares in banking group Close Brothers have tumbled after it reported that the UK’s motor finance scandal dragged it into a loss.

Close Brothers reported an operating pre-tax loss of £103m for the six months to 31 January 2025, and a loss after tax ofo £111.8m.

It was dragged into the red by a £165m provision relating to motor finance commissions, the practice where UK lenders made undisclosed payments to car dealers when customers bought cars on credit.

Close Brothers is continuing to not pay a dividend, until the cost of motor finance compensation claims is known.

The company expects to spend £22m this financial year on complaints handling and other operational and legal costs – more than the £10m-£15m it had previously forecast. That increase is due to additional costs associated with an appeal to the Supreme Court over a court of appeal ruling against Close Brothers, which widened the potential scale of the scandal.

Close Brothers’ shares are down 13% in early trading.

More than 6,000 IT staff at Lloyds Banking Group are due to learn their fate today, more than a month after the high street lender put their jobs under review.

Line managers are due to speak to staff individually this morning, with a company-wide announcement due Tuesday afternoon.

Overall, there is expected to be a net increase in IT vacancies - totalling around 1, 200 according to the banking group, which owns the Lloyds, Halifax and Bank of Scotland brands.

But the problem is how many existing IT staff will be deemed fit to fill them.

Some are expected to be pushed out as a result of a change in job location (with new roles being too far from their home,) their position no longer existing, or requiring more specialised skills.

It is all part of a wider reshuffle related to a major digitisation plan under CEO Charlie Nunn.

However, a reshuffle that puts some staff at risk comes at an awkward time, given how hard existing IT staff feel they’ve been working to help the bank through high-profile outages, that are now under scrutiny by MPs on the Treasury Committee.

Lloyds was among a raft of banks whose customers struggled to log into online bank accounts or suffered payment delays at the end of February.

Overall, MPs are concerned that customers at Britain’s major banks and building societies have suffered the equivalent of more than one month’s worth of IT failures in the last two years.

One of Lloyds’ staff unions, Accord, said it would not be commenting about the IT reshuffle until employees were informed.

Lloyds said:

“Making changes means not only creating new roles and upskilling colleagues but also saying goodbye to talented people who have been part of the group’s success in the past. Where that is the case, we will do everything we can to support them with the changes recently announced.

“We know change can be uncomfortable, but we are excited about the opportunities ahead as we propel forward to achieve our growth ambitions and delivering exceptional customer experiences.”

We appear to be in the third major bull run in gold since Richard Nixon withdrew America from the gold standard on 15 August 1971, reckons AJ Bell investment director Russ Mould.

He explains:

“The first surge took place in the 1970s, after Nixon’s policy switch that was designed to free up room for US government spending, particularly in Vietnam. Two oil price shocks, in 1973 and 1979, stoked inflation and investors took fright from paper assets and promises, such as government debt, and sought out ‘real’ assets where supply only grew slowly instead.

“The second took place in the early 2000s, as central banks played increasingly fast and easy with monetary policy in response to a series of crises, real or perceived. They ranged from the collapse of the LTCM hedge fund in 1998, the millennium IT bug, the collapse of the technology, media and telecoms bubble and then the Great Financial Crisis and the European Debt Crisis. Record-low interest rates and Quantitative Easing followed, to persuade some investors that central banks and policymakers had lost control, just as it seemed they had in the 1970s.

“The third, and current surge, has its origins in the last decade, as central banks continued to run zero-interest rate policies and did little to sterilise QE. Then came the Covid pandemic, and a crisis for which already-tattered government balance sheets were, in many cases, ill-prepared. Government borrowing surged, especially in the UK and USA, and in the latter the federal debt has continued to grow at an unprecedented pace. The result is that the annual interest bill is now $1.2 trillion, or more than a fifth of the federal tax take, a situation that seems unsustainable. The Trump administration is trying to tackle this head on, with tariffs and efforts to boost America’s manufacturing base, but perhaps gold bugs are sensing another shift in global monetary policy and how the system is managed, especially as inflation remains stubbornly above central banks’ 2% target.

Back when Nixon took the US off the gold standard, bullion was valued at $35 per ounce under the Bretton Woods fixed exchange rate system – a price that proved impossible for the US to stick to, as the money supply increased and other countries swapped their dollar reserves for gold.

Once the US was no longer committed to backing every dollar overseas with gold, at that price, gold began to climb steeply, and by January 1980 it had hit $835 per ounce.

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

It’s been a record-breaking year for gold, as nervous investors have sought out safe-haven assets.

And this morning, the precious metal has hit a fresh all-time high above $3,000 per ounce, driven by escalating geopolitical tensions in the Middle East, trade war fears and the weakening US dollar.

Gold touched $3,017.64 per ounce, as news broke that Israeli military forces have launched widespread strikes on targets across Gaza early today, leading to fears that the shaky ceasefire in the region is over.

This means gold has climbed by 15% since the start of this year, having ended December at $2,623/ounce, adding to its 27% surge during 2024.

As this chart shows, it has now doubled over the last five years:

The recent weakness of the US dollar has also pushed up the gold price. The greenback is trading near a five-month low against a basket of other currencies, as traders worry that Donald Trump’s enthusiasm for tariffs will trigger a full-blown trade war, that could push the US into recession.

As analysts at Deutshe Bank put it:

Investors continue to rotate away from the US dollar and find perceived safe havens amidst the heightened policy uncertainty.

Linh Tran, market analyst at XS.com, reports that rising tensions in the Middle East and the escalating U.S.-China trade conflict have both driven investors toward gold as a safe investment channel, adding:

These uncertainties have not only increased demand for gold but have also pushed significant capital inflows into the precious metals market, contributing to gold reaching record-high prices.

The agenda

• 9.30am: ONS releases changes to the UK inflation basket

• 10am GMT: ZEW eurozone economic confidence survey

• 12.30pm GMT: US housing starts/building permits data for February

• 1.15pm GMT: US industrial production for February