Kalyeena Makortoff

JD Sports Fashion has cut its full-year pre-tax profit forecast by £50m to £700m–£800m as inflation and cost-of-living pressures reduce demand for trainers, particularly among younger shoppers in the United States. Like-for-like sales fell 3.1% in the second quarter, including a 6.8% decline in North America and a 2.7% decline in Europe, while the UK benefited from World Cup football-kit demand and stronger outdoor-gear sales. The retailer has used discounts and promotions to support demand, but analysts warn that its reliance on struggling Nike, a maturing sportswear market and changing preferences toward outdoor and performance products are weighing on growth. JD’s shares fell 14%, and recent leadership changes underscore continuing strategic disagreements.

The UK’s four largest banks reported £29.2bn in combined first-half profits, with £13.7bn returned to shareholders, intensifying calls for Andy Burnham’s government to impose a windfall tax and fund cost-of-living and social-care measures. Trade unions and campaigners argue banks can afford to contribute more, while executives warn that higher taxes could reduce lending, weaken economic growth and deter investment. The article reviews the City’s successful resistance to earlier levies, including HSBC’s threat to move its headquarters, and notes alternative proposals for taxing bank reserve income. Burnham has not committed to a bank tax, but any move in that direction would likely trigger a renewed confrontation with the financial sector.

Conservative leader Kemi Badenoch defended the selection of Joshua Bonehill-Paine, a former neo-Nazi activist jailed for racially aggravated harassment of Jewish Labour MP Luciana Berger, arguing that he had shown contrition, been rehabilitated and deserved a second chance. Prime Minister Andy Burnham’s revised early-release scheme will exclude prisoners convicted of rape, serious child sexual offences and grooming, but some domestic abusers and killers—including two men involved in the death of PC Andrew Harper—remain eligible, prompting condemnation from Harper’s family. Probation officials warned that the service lacks the staff and funding to manage the additional workload. The live coverage also reported falling police numbers in Scotland, rising Scottish exam results, Reform UK’s narrow polling lead over Labour, calls for a bank windfall tax after strong HSBC profits, Gatwick’s approval to develop a second runway, and the return of 157 people after a small boat capsized in the Channel.

Oil prices and energy-company profits surged after the US-Israeli war with Iran disrupted Gulf exports. BP reported quarterly profits of $5.73bn, while ExxonMobil and Chevron also drew criticism from Donald Trump for allegedly profiting excessively from the supply shortage. Oil later fell below $80 a barrel after Treasury Secretary Scott Bessent suggested a US-Iran deal to reopen the Strait of Hormuz could be imminent; Qatar, Pakistan and Oman were helping mediate. Saudi Aramco warned that inventories had fallen by more than 2.6bn barrels and that replenishment could take up to 18 months. UK banks also reported strong profits, prompting renewed calls for a windfall tax, while Gatwick Airport won approval to proceed with its £2.2bn second-runway project. Markets reached records in some areas, Caterpillar benefited from data-centre demand, and Spotify reached 300 million Premium subscribers but forecast weaker-than-expected operating income.

Campaigners including Positive Money and the Trades Union Congress are urging the UK government to impose a windfall tax on banks after HSBC reported $10.1bn (£7.5bn) in second-quarter profits, up 60% year on year. They estimate a levy modeled on Spain’s system could raise £19bn to fund Andy Burnham’s proposed cost-of-living measures, while banks warn that excessive taxation could undermine lending and economic growth. HSBC plans to resume share buybacks and may increase bonuses. Metro Bank also reported sharply higher profits, though it would likely fall below the proposed tax threshold. ActionAid UK separately called for banks to pay more for their climate and human-rights impacts.

UK Government Investments disclosed that an internal file containing high-level management information and the names and work email addresses of 51 government officials was publicly accessible for about 40 hours. The breach was attributed to a staff member who failed to follow information-security rules, and UKGI notified the Information Commissioner’s Office and commissioned an external review. The agency says it has implemented or is implementing most recommended control improvements. The incident highlights broader concerns about cyber vulnerabilities as AI agents increase the speed and scale at which attackers can probe security gaps.

The FTSE 100 reached a record high and was on course to gain roughly 3.5–4% in July, recovering from the sharp March sell-off triggered by US-Israeli attacks on Iran. Rising oil prices pushed UK petrol to about 160p per litre and diesel to 179p, increasing pressure on households and airlines. Morrisons reported a £926m loss and nearly 5,000 job cuts, while Sainsbury’s agreed to sell Argos for £120m. IAG’s profits fell as fuel costs rose, and eurozone inflation edged up to 2.9%, raising expectations of further interest-rate increases. BP put its North Sea operations up for sale, HS2 renegotiated major contracts to improve cost control, and Asian and US equity markets also showed strength.

UK house prices increased by only 0.1% in July to an average of £277,542, while annual growth slowed to 1.8% from 2.2% in June. Nationwide attributed the subdued market to economic uncertainty, geopolitical tensions and volatile expectations for Bank of England interest rates. Estate agents reported more sellers than buyers and broadly flat prices, while Taylor Wimpey warned of weaker demand and rising building costs. Mortgage activity briefly surged as borrowers sought to lock in deals, but later returned to more normal levels.

The Bank of England held its benchmark interest rate at 3.75%, although three of nine Monetary Policy Committee members voted for an increase to counter inflationary risks arising from the Iran war and higher oil prices. Governor Andrew Bailey said the Bank had not begun preparing markets for a future hike because there was little evidence that energy costs were generating broader second-round price pressures. Markets consequently reduced expectations of a September increase. The coverage also reported weaker-than-expected US second-quarter growth, faster eurozone growth, record highs for the FTSE 100, and strong results or upgraded forecasts from Shell, Rolls-Royce and BAE Systems. Lloyds announced a further £2bn in cost reductions, while Airbus was fined £6.4m for export-control breaches.

Lloyds Banking Group plans to cut a further £2bn in costs over four years while investing £13bn by 2030 in technology, artificial intelligence and business growth. Chief executive Charlie Nunn said AI would support personalised financial advice, customer offers, relationship managers and faster mortgage approvals, but he did not specify the potential impact on jobs. The bank will review technology, office space and productivity, while reskilling staff and hiring for new roles. Lloyds also intends to expand its corporate and institutional banking operations in the US and Europe, strengthen its car finance business, and develop services for electric-vehicle buyers. The strategy was announced alongside a 14% rise in second-quarter profit to £2.3bn, a dividend increase and a £1bn share buyback.

Oil prices rose about 6% after Donald Trump threatened Iran with military retaliation following an attempted surprise attack, adding geopolitical and inflation concerns ahead of the Federal Reserve’s interest-rate decision. Global chip stocks continued to fall after weak results from SK Hynix, while the UK’s tech-light FTSE 100 remained relatively resilient and briefly reached an intraday high. Major corporate developments included Grant Thornton’s proposed $5bn acquisition of CBIZ, Standard Chartered’s $1bn share buyback following stronger profits, and sales growth at Chapel Down. Ofgem proposed upfront financial guarantees for datacentre grid connections, BMW reportedly began a programme that could eliminate up to 8,000 German jobs, and UK data showed workless households increasing in more than half of local authority areas.

Unilever says it expects to raise prices further in the second half of 2026 as higher commodity and service costs feed through to consumers. The company reported second-quarter underlying sales growth of 5.8%, turnover growth of 3.8% to €13bn, and volume growth of 5.5%, helped by strong demand for branded products and increased marketing, particularly for personal-care brands such as Dove, Vaseline and Sunsilk. Temporary discounts linked to the World Cup and competitive conditions in Brazil slowed price growth during the quarter, but Unilever expects pricing to become the main driver of growth later in the year. Analysts viewed the results and upgraded outlook positively, while warning that persistently high oil prices could increase inflation, transport costs and pressure on household budgets.

Barclays’ first-half bonus pool rose nearly 30% to £1.3bn as pre-tax profits increased 17% to £6.1bn, enabling the bank to announce a £1bn share buyback and £800m in dividends. The Trades Union Congress urged Andy Burnham’s government to raise the bank surcharge and use additional revenue to help reduce household energy costs. Barclays argued that UK banks already face higher effective taxation than peers in Frankfurt and New York, while executives said retaining capital is important for lending and economic growth. The bank described the larger bonus accrual as a mechanical response to stronger revenues, with final compensation decisions due later.

Oil prices fell about 6% as the US and Iran paused hostilities, easing immediate fears of further disruption to shipments through the Strait of Hormuz, although Red Sea attacks and low European gas inventories kept winter supply risks elevated. Global equities rallied, while bond yields declined. AstraZeneca reported stronger-than-expected second-quarter profits and revenue, driven by cancer treatments, with CEO Pascal Soriot urging western drugmakers to match China’s pace of innovation. DCC Energy agreed to a £5.75bn takeover by KKR and Energy Capital Partners, adding to the list of companies leaving London’s stock market. Other developments included Shein’s first-quarter loss before a planned Hong Kong listing, Vodafone’s stronger revenue growth, China’s opposition to new US tariffs, and an FCA campaign encouraging consumers to claim car-finance compensation directly.

Jes Staley testified in a closed-door session before a US House oversight panel examining his long-standing ties to Jeffrey Epstein. Regulatory findings, including a UK Financial Conduct Authority ruling based on extensive JPMorgan emails, concluded that Staley’s relationship with Epstein was closer than he claimed, leading to his ban from the UK financial sector and the loss of significant compensation. Recent US Department of Justice documents renewed scrutiny, though no charges have been brought. The hearing transcript will be released later as part of an ongoing congressional investigation involving multiple high-profile witnesses.

US lawmakers led by Elizabeth Warren pressed Barclays for explanations on its failure to uncover former CEO Jes Staley’s long‑standing ties to Jeffrey Epstein. In a letter to chair Nigel Higgins, they questioned the bank’s due diligence, its handling of Staley’s disclosures, and broader governance practices. The inquiry follows revelations from a UK court case in which Staley unsuccessfully appealed his industry ban for misleading regulators. Lawmakers warned that Barclays’ ability to operate in the US depends on strong management oversight. Barclays maintains it was misled by Staley and that key information emerged only after its internal investigation.

Brent crude rose above $95 a barrel as renewed US-Iran hostilities and Houthi threats to shipping raised concerns about disruptions through the Strait of Hormuz and Bab el-Mandeb. UK inflation fell faster than expected to 2.6% in June, helped by lower fuel and food prices, although businesses warned the improvement could be temporary as energy costs rise. The live coverage also reports criminal charges against former Southern Water employees over alleged wastewater-testing fraud, uncertainty over easyJet takeover bids following a possible EU review of ownership rules, AMD’s planned investment of up to $5bn in Anthropic, a $1.5bn Anthropic copyright settlement benefiting Bloomsbury, falling London house prices, and several major corporate earnings and takeover developments.

Lloyd’s of London found that former chief executive John Neal and former corporate affairs director Rebekah Clement failed to disclose a close relationship that created a perceived conflict of interest. The investigation found no conclusive evidence of a romantic relationship or promotion-related process failures, but said senior managers had raised concerns with Neal repeatedly and that he did not materially change his conduct. Lloyd’s also reported that whistleblower allegations dating to 2023 had not been escalated to the appropriate level, prompting notification to the Financial Conduct Authority. Neal had already forfeited unvested pay after resigning, while Clement is considering legal action, arguing that the finding against her was based on rumor and damaged her career and health.

JD Wetherspoon issued its fourth profit warning in seven months after lower-than-expected sales and rising costs for food, labour, energy and business rates pushed expected profits below forecasts. Shares fell 10% following Tim Martin’s warning that full-year earnings would miss expectations, with like-for-like sales up only 4% despite the World Cup. Late match kick-off times and broader cost pressures, including higher minimum wages and energy prices linked to the US-Israel conflict with Iran, further weighed on performance. While net debt is expected to settle at £720m, analysts remain cautious about the company’s investment outlook.

Equinor’s quarterly profits nearly doubled to $11.5bn as higher oil and gas prices driven by the war against Iran boosted revenues. Increased production early in the conflict helped offset reduced global supply following disruptions in the strait of Hormuz. Brent crude prices surged amid renewed hostilities despite briefly falling after a US‑Iran memorandum of understanding. Continued US strikes on Iran and a new Houthi blockade on Saudi oil routes further pushed energy prices higher.

The Bank of England will stop accepting bonds linked to thermal coal as collateral for loans to commercial banks from October. The policy reflects concerns that the transition to net zero could make coal-related assets financially risky and is stricter than measures adopted by many other western central banks. Climate campaigners welcomed the move as an important signal that could prompt commercial banks to reassess coal-related holdings, but warned that its impact will depend on how climate-risk discounts are calculated and urged the Bank to extend exclusions to fossil-fuel expansion and deforestation. The decision comes as financial institutions face political pressure, particularly in the United States, to retreat from climate commitments.

Andrew Bailey said he would have delayed meeting Nigel Farage last autumn if the Bank of England had known about the undeclared £5m gift Farage received from crypto billionaire Christopher Harborne, which is now subject to a parliamentary inquiry. Bailey defended holding the meeting to discuss cryptocurrency regulation and rejected suggestions of improper influence, noting that the Bank later revised stablecoin rules on technical grounds. Farage had used the meeting to challenge plans for a state-backed digital currency and limits on stablecoin holdings. Bailey said the controversy will not alter how the Bank engages with political figures, stressing the need for confidential communication and equal access for party leaders.

Andrew Bailey urges global cooperation to manage AI risks, warning that the United States cannot secure its systems alone, particularly after its temporary ban on foreign access to Anthropic’s Claude Mythos model. Rachel Reeves defends her economic record as she prepares to leave the Treasury, citing improvements in borrowing, productivity and wages, while cautioning that geopolitical instability, including renewed conflict in the Middle East, continues to threaten economic resilience. Rising gilt yields and fiscal pressures await the incoming chancellor, expected to be appointed by Andy Burnham’s new government. Demis Hassabis calls for a US-led global AI watchdog, arguing that models with human-level cognitive capabilities may be only years away.

The Financial Conduct Authority is seeking to have Consumer Voice removed from legal challenges over the UK car loan mis‑selling scandal, alleging undisclosed funding arrangements and conflicts of interest tied to Courmacs Legal. Consumer Voice, which advocates for higher compensation for affected borrowers, argues the regulator’s payout plan underestimates consumer losses and prioritises lender concerns. Major banks and car finance providers face about £9.1bn in compensation liabilities. Consumer Voice denies the FCA’s claims, insisting it receives no financial benefit from the car finance case.

The Bank of England plans to loosen capital requirements for major UK lenders, including scrapping part of the leverage ratio, despite concerns within its financial policy committee about heightened risks from AI developments and increased market leverage. Some members warned that reduced buffers could worsen vulnerabilities tied to debt‑fuelled investments in AI‑related stocks. The committee will review the proposals for potential stability gaps before finalising changes in 2027. Officials also highlighted rapidly growing cyber risks linked to advanced AI systems such as Anthropic’s Mythos, prompting calls for stronger oversight and international coordination to protect the financial system.

A review by the UK Financial Conduct Authority warns that financial services are rapidly shifting toward AI-driven models, increasing risks of fraud, cybercrime and consumer harm. Led by FCA executive Sheldon Mills, the report recommends expanding the regulator’s authority to oversee critical third‑party tech providers and giving it direct powers to regulate AI firms. It calls for regulators to adopt AI internally and for government action to prevent digital monopolies and strengthen consumer protection. The review highlights growing public willingness to use AI for financial decisions despite limited oversight and raises concerns over the cybersecurity risks posed by Anthropic’s Mythos model, whose use was recently restricted by US authorities.

Bankers and trade unions are preparing for conflict over a potential windfall tax on UK banks proposed to help fund Andy Burnham’s support package for struggling households. Union leaders urge higher taxes on bank profits, while City executives warn such a move would damage competitiveness and risk investment losses. Banks argue they already face high tax rates compared with other financial centres. The debate has intensified as bank profits rise with higher interest rates and as the incoming government faces significant fiscal pressure. Lobbying is expected to increase once the new chancellor is appointed.

Lloyds Banking Group will retire the Halifax brand after 173 years, ending new account openings and moving existing Halifax customers to Lloyds branding. Signage will be removed from 190 Halifax branches beginning in early 2027, though no branches will close. The move follows a strategic branding review and comes ahead of a broader plan to be announced by chief executive Charlie Nunn. Halifax customers will retain account details and existing services while gaining access to Lloyds’ expanded offerings. The change has prompted concern among loyal customers and residents of Halifax, given the brand’s long history and its role in UK banking. HBOS’s troubled past, including the Reading branch scandal and the 2008 bailout, adds further context to the decision.

The UK Financial Conduct Authority will introduce extensive regulations requiring crypto firms to hold capital against risky assets and conduct annual stress tests beginning in October next year. Firms will determine their own risk levels for testing, and capital requirements for some assets such as stablecoins have been reduced after industry feedback. Regulators aim to strengthen consumer protection and curb harmful practices, though crypto investments will remain high risk. Industry figures welcome clearer rules, while market analysts warn consumers to remain cautious.

Nationwide will cut 600 roles as part of its integration of Virgin Money following a £2.9bn takeover, with most redundancies expected among back‑office staff whose roles overlap. Consultations are under way with the Nationwide Group Staff Union and Unite. The lender says it is recruiting for 270 positions but none are reserved for affected workers. The merger has drawn scrutiny over governance, including members’ lack of a vote on the deal and a sharp rise in CEO Debbie Crosbie’s potential pay. The cuts follow earlier rounds of job reductions at Nationwide and come as the building society continues expanding into business banking while pledging to keep branches open until at least 2030.

Community banks representing about 4,000 lenders warn that the Clarity Act’s provisions allowing rewards on stablecoin transactions could trigger major deposit outflows, reducing funds available for small business and agricultural loans. The ICBA has launched a significant ad campaign arguing the legislation would shift capital toward global crypto platforms and undermine rural economies. Crypto industry representatives counter that the bill already includes concessions for banks and offers needed regulatory clarity. The debate has created tension within the Republican Party as it weighs support for crypto expansion against the interests of rural constituents. Congress is now under pressure from both sides as the bill moves forward.

Revolut will require graduates and interns in its 2027 programmes to work in the office at least three days a week, shifting away from the remote‑first flexibility offered to other employees. The company says early‑career staff benefit from in‑person learning, while maintaining that remote‑first remains unchanged for its wider workforce. The move aligns Revolut with major banks that tightened remote‑work policies post‑pandemic, and successful trainees who gain full‑time roles will regain full remote‑work benefits after probation.

The UK’s Financial Reporting Council fined and temporarily banned audit firm King & King and its managing partner, Milankumar Patel, for widespread failures in auditing companies within Sanjeev Gupta’s GFG Alliance. Investigators found the firm relied heavily on fees from GFG entities, breaching independence rules and failing key audit requirements. The sanctions follow broader scrutiny of GFG’s finances after the collapse of its lender, Greensill Capital, and an ongoing Serious Fraud Office investigation into suspected fraud and money laundering.

Lloyds Banking Group plans to hire 300 technology specialists to expand its work with agentic AI ahead of a new strategic plan, while acknowledging that wider AI adoption may lead to future job cuts. The effort aligns with moves by major banks, including Santander and Standard Chartered, to use AI for efficiency and cost savings. Lloyds aims to apply AI to fraud prevention, internal operations and improved customer services, using models such as Claude and Gemini. The bank has already seen financial gains from generative AI, but research from KPMG highlights industry gaps in testing and resilience planning for potential AI system failures.

Brexit’s legacy is examined through five emblematic sectors showing long-term disruption to manufacturing, fishing, travel, social care and financial services. Sunderland’s car industry suffered uncertainty and declining output despite government support, while fishing communities saw little of the promised gains and in some cases faced worsening conditions. Travel to Europe became more complex and costly for UK citizens, with new passport rules and border systems adding friction. The social care sector lost significant EU labour, driving recruitment crises and reliance on non‑EU migrants before new restrictions worsened shortages. In finance, fears of large‑scale job losses to Europe proved overstated as the City adapted, though costs and duplication increased. Across all areas, Brexit’s real outcomes diverged sharply from expectations, revealing a more fragmented and challenging landscape than promised.

Barclays will acquire the UK business of GoHenry from Acorns to expand its presence in youth banking, keeping the GoHenry brand while integrating it into its broader family-focused offerings. GoHenry, founded by Louise Hill and used by about 500,000 UK children, provides prepaid debit cards and financial education tools for young people. The acquisition positions Barclays against rivals such as NatWest, Revolut and Monzo, which are also competing for younger customers. Analysts note GoHenry’s unprofitability and suggest Barclays’ primary goal is customer acquisition and long-term retention. The deal will slightly reduce Barclays’ CET1 ratio but is not expected to affect its financial targets, and its shares rose nearly 5% following the announcement.