10 things you need to know in markets today

Good morning! Here’s what you need to know in markets on Wednesday.

1. Splits over Brexit emerged yesterday at the very highest levels of the British government as the Brexit secretary accused the chancellor of inconsistency and Boris Johnson faced mockery, the Times reports. Prime Minister Theresa May appeared to be struggling to contain divisions within her top team after David Davis and Philip Hammond set out alternative timetables for Brexit.

2. Popular support for higher taxes and increased public spending is stronger than it has been for more than a decade, according to a study of social attitudes reported in the FT. Just under half of Britons are now in favour of higher tax and spend policies — the highest proportion since 2004.

3. A new government advisory group involving the main UK business organisations has been set up by senior ministers, to give higher priority to companies’ concerns in the Brexit negotiations, the FT reports. The move will be seen as an attempt by the government to build bridges with business after months of what was seen as a deliberate effort by 10 Downing Street to give it the cold-shoulder.

4. One of the world’s biggest cyberattacks disabled computer systems across Russia, Britain and the US yesterday, freezing government departments, disrupting oil and shipping companies and restricting radiation checks at the Chernobyl power plant, the Times reports. Experts said that the virus, which hit Ukraine before spreading to Europe and America, could be a global outbreak of Petrwrap, a type of ransomware similar to the virus that affected NHS hospitals last month.

5. Britain’s major lenders have been told by the Bank of England that they must set aside a combined £11.4 billion of capital in the next 18 months as a means to protect themselves from the risks of an economic downturn. In its Financial Stability Report — released on Tuesday morning — the bank increased the so-called counter cyclical capital buffer (CCB) from 0% to 0.5%, with the expectation that that buffer will be increased to 1% at the next stability report in November.

6. Japanese bank Nomura has confirmed reports it is applying for a licence to operate in Frankfurt as its European Union base after Brexit. Currently, its official European HQ is in London. The bank will transfer fewer than 100 staff from London, where it currently employs between 2,500 and 2,800 people.

7. Japanese stocks wobbled on Wednesday morning as tech shares were dragged down by falls in their U.S. counterparts overnight, while financials rallied on the back of rising U.S. yields, Reuters reports. The Nikkei share average shed 0.2% to 20,181.62 in midmorning trade, while gains in banking stocks and insurers supported the broader Topix, which tacked on 0.1%.

8. Oil prices fell early on Wednesday after a report of rising U.S. fuel inventories underscored concerns that a three-year old crude glut is far from over, Reuters reports. Brent crude futures were at $US46.32 per barrel at 1.12 a.m. BST (8.12 p.m. Tuesday ET) down 33 cents, or 0.7%, from their last close.

9. Google was hit on Tuesday with a record-breaking fine of 2.4 billion euros ($US2.7 billion, £2.1 billion) by European regulators. The European Commission accused the California-based technology giant of abusing its dominant position and promoting its own shopping service in its search results over those of its competitors.

10. Hot fintech startup Revolut’s eye-catching growth has seen it burn through millions of pounds in investment, new accounts show. London-based Revolut, which offers a pre-paid international currency card, made a pre-tax loss of £7.1 million in 2016, its first full year of operations. Revenue was £2.3 million in the year to December 31, accounts filed with Companies House show.

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