Behold the heatwave! The temperatures, after dipping into the teens – and even lower with cloud cover to boot – are rising again amid the promise of more sunshine this weekend.
Past that weather report, in the world of finance a lot has happened this week. Central banks took a call on interest rates, the US and China are holding their first trade talks today in Switzerland, and the UK became the first nation to seal a trade deal with the US after president Trump's tariff policy upended the global economy.
The UK also signed a trade with India, and mergers and acquisitions were in focus with DoorDash (DASH) agreeing to acquire Deliveroo (ROO.L) for $3.8bn (£2.9bn) and Associated British Foods (ABF.L) buying dairy technology firm National Milk Records for £48m. There were also reports of Shell (SHEL.L) preparing a takeover bid for BP (BP.L), though both declined to comment about this to Yahoo Finance.
A major UK think tank warned of tax rises, saying chancellor Rachel Reeves is running out of choices and facing a reckoning before the autumn budget when the government may have to discard its self- imposed fiscal rules — thanks to reduced growth projections amid mounting global uncertainty.
Quite a lot to unpack, you see.
But before we get to that, here’s how Warren Buffett signed off at the 60th annual shareholder meeting of Berkshire Hathaway (BRK-B, BRK-A) last Sunday, signalling it would be his final appearance as chairman and CEO.
“That’s the news hook for the day,” 94-year-old Buffett said, as he announced his retirement after six decades in which he transformed a struggling textile company that he took over in 1965 into a $1.12tn behemoth.
In the interim, the price of Berkshire class A shares rose from $19 to $778,173 — a staggering 4,095,546% growth. To visualise that scale of growth, imagine Berkshire as an average-sized tree in 1965. It would have grown so tall today that the top would reach the International Space Station.
On that note, here are the highlights from the last seven days, plus a glimpse at the week ahead.
Warren Buffett shook the investment world last week with four words: ‘The time has arrived.' ·Reuters / Reuters
Warren Buffett to step down as Berkshire Hathaway CEO at year-end, Greg Abel to take over
Warren Buffett announced at the 60th annual shareholder meeting of Berkshire Hathaway (BRK-B, BRK-A) on Saturday 3 May that he plans to hand over the reins at year-end.
“I think it's time that Greg [Abel] should become the chief executive officer of the company at year-end,” said Buffett. “And I want to spring that on the directors, effectively, and give that as my recommendation.”
Abel, currently vice chairman at Berkshire Hathaway and overseer of the company's operating businesses, was tabbed as Buffett's successor in 2021.
Buffett said that he has no plans to sell any of his Berkshire Hathaway stock as part of this transition. He has served as CEO since 1970.
Bank of England cuts interest rates to 4.25%
The Bank of England (BoE) cut interest rates to 4.25% in a quarter-point reduction on Thursday. The cut marked its fourth since rates peaked at 5.25% last year and comes amid a global trade war and a weak domestic economy.
BoE governor Andrew Bailey said policymakers should take a “gradual and careful” approach to cutting interest rates.
Bailey said: “Inflationary pressures have continued to ease, so we’ve been able to cut rates again today. The past few weeks have shown how unpredictable the global economy can be.”
Fed holds rates steady, defying Trump's call for cuts
The Federal Reserve held US interest rates steady on Wednesday for the third meeting in a row, defying president Donald Trump's calls for it to again loosen monetary policy while also warning of increased economic uncertainty.
Fed chair Jerome Powell said the central bank does not “need to be in a hurry” as it evaluates how Trump's tariffs will affect employment and inflation and whether talks with America's largest trading partners change the outlook.
Powell made it clear he is concerned about the effect Trump's tariffs could have: “My gut tells me that uncertainty for the path of the economy is extremely elevated.”
The UK-US trade deal announced on Thursday received a mixed response from market observers, with most remaining guarded about its long-term prospects.
Hailed as a ‘breakthrough and great deal' by Trump, the US-UK pact is the first for his administration since imposing — then pausing — sweeping “reciprocal” tariffs against all trading partners in early April.
It offers the UK relief from tariffs on cars and steel, while the UK reduces tariffs on US products, including beef and ethanol. Overall, a 10% tariff on most imports remains in place.
The London stock market, however, didn't move much either with the anticipation of the deal or its announcement. The FTSE 100 (^FTSE) closed 0.3% lower on the day, and lagged behind its European peers. The FTSE 250 (^FTMC) only delivered minor gains.
Rolls-Royce (RR.L) shares jumped as it emerged as a big winner from the trade deal. It won’t have to pay tariffs on aircraft engines shipped to Boeing (BA) in the US.
The most bought stocks and funds for investors in April
Nvidia CEO Jensen Huang. ·David Zalubowski, Associated Press
April was a particularly volatile month for markets, amid developments around US president Donald Trump's tariff agenda.
The investments that proved most popular last month across UK platforms Interactive Investor, Hargreaves Lansdown, Robinhood (HOOD) and Bestinvest included oil major BP (BP.L), chipmaker Nvidia (NVDA) and financial services firm Legal & General (LGEN.L).
Read more: Stocks to watch next week
New research for Hargreaves Lansdown found that 55% of people say they manage short-term finances, like paying the bills and saving for a holiday, between them and their partner. ·SimpleImages via Getty Images
Do you split the bills with your partner? Most likely, but despite a majority of couples sharing financial responsibilities, there is still a gender split, with more women disproportionately impacted when it comes to money matters. More on this by our columnist Sarah Coles as she asks the question Who wears the financial trousers in your relationship?
This week, we also focused on pension musings: How often do you think about it, and why should you? Helen Morrissey talks about how to plan for retirement and track your pension pot income.
Find more personal finance gems here: Money Matters
Monday 12 May
Data: US April federal budget balance, Japan March BoP current account balance, BoP trade balance, April bank lending, Economy Watchers survey, Denmark April CPI
Central banks: Fed's Kugler speaks, BoE's Lombardelli, Greene, Taylor and Mann speak
Earnings: UniCredit (UCG.MI), Petroleo Brasileiro (0KHP.L)
Tuesday 13 May
Data: UK jobs report, US April CPI, NFIB small business optimism, Japan April M2, M3, Germany May Zew survey, March current account balance, Eurozone May Zew survey
Central banks: BoJ's summary of opinions from April meeting, ECB's Escriva, Knot and Makhlouf speak, BoE's Governor Bailey and Pill speak
Earnings: Munich Re (1MUV2.MI), Sea, JD.com (JD), Bayer (1BAYN.MI), Venture Global (VG), On Holding (ONON)
Wednesday 14 May
Data: Japan April PPI, Canada March building permits
Central banks: Fed's Waller, Jefferson and Daly speak, ECB's Nagel and Holzmann speak, BoE's Breeden speaks
Earnings: Tencent (0700.HK), Cisco (CSCO), Sony (SONY), E.ON (EOAN.MU), Coreweave (CRWV), RENK (R3NK.F), Burberry (BRBY.L)
Thursday 15 May
Data: UK Q1 GDP, US April PPI, retail sales, industrial production, capacity utilisation, May Philadelphia Fed business outlook, Empire manufacturing index, NAHB housing market index, March business inventories, initial jobless claims, Japan April machine tool orders, Germany April wholesale price index, Italy March general government debt, Eurozone Q1 employment, March industrial production, Canada April housing starts, existing home sales, March manufacturing sales, Australia April labour report, Norway Q1 GDP
Central banks: Fed's Chair Powell and Barr speak, ECB's Cipollone, Elderson, Guindos and Villeroy speak, BoE's Dhingra speaks
Data: US May University of Michigan survey, New York Fed services business activity, April building permits, housing starts, import and export price indices, March total net TIC flows, Japan Q1 GDP, March capacity utilisation, Italy March trade balance, Eurozone March trade balance, Canada March international securities transactions
Central banks: Fed's Barkin speaks, BoJ's Nakamura speaks, ECB's Lane speaks, BoE's Lombardelli speaks
Earnings: Cie Financiere Richemont (CFRZ.XC)
Other: European Commission Spring Economic Forecasts
*Calendar courtesy of Deutsche Bank
Sir David Attenborough turned 99 this week. He remains mesmerisingly brilliant. As he enters his 100th year he launched what he called one of the most important films of his career: Ocean. “After almost 100 years on the planet, I now understand the most important place on Earth is not on land, but at sea.”
Do watch. Happy birthday Sir David!
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