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Europe
BBC Business

Stick to spending limits, PM and chancellor tell ministers in joint memo

Chancellor John Healey and Prime Minister Andy Burnham have written a joint letter to cabinet ministers telling them they must stick within their existing spending limits while funding new pledges. After taking office, Burnham announced a host of new cost-of-living policies, including scrapping of VAT from domestic electricity bills, reduced business rates for pubs, and capping bus fares in England. Burnham and Healey are determined to stick within the fiscal rules set out by their predecessors Sir Keir Starmer and Rachel Reeves, treasury sources have told the BBC. Healey's first Budget will be on 28 October and will be "built on fiscal discipline", the chancellor said. Healey said the budget would "meet our fiscal rules" and "give businesses and families some of the stability they need to plan for the future". A report in the Times says the joint letter told ministers they must "within the budgets they have already got" even while "pay[ing] for new things they want to do this year and next". While the ongoing war in Iran is pushing up inflation and borrowing costs, senior Treasury sources confirmed the government is determined to stay "well within the fiscal rules" inherited from Sir Keir Starmer and his chancellor Rachel Reeves. But Burnham has said his government will stick to Labour's fiscal rules on spending and borrowing as well as the party's 2024 manifesto pledges not to increase income tax, VAT or national insurance contributions. He also said he will honour the fiscal rules imposed by Reeves, which include a pledge to balance day-to-day spending with tax revenues by the end of the decade. An influential think tank said earlier this week that the prime minister only has a small margin of error to do this, and that Healey may have to cut spending or raise taxes to meet Burnham's policy priorities such as such as extra defence spending and better social care. Healey was Defence Secretary under Keir Starmer, but resigned after a row over defence spending commitments - saying he was "certain" that Britain should lift its spending to 3% by 2030. Questioned about funding on Thursday, Burnham's Defence Secretary Wes Streeting repeatedly refused to commit to that target.

Stick to spending limits, PM and chancellor tell ministers in joint memo
North America
CNBC Finance

FIFA tests the limits of private equity in sports with World Cup subsidiary sale

Global soccer may be finding the limits to private equity's stampede into sports. A plan by FIFA to sell a minority stake in a new subsidiary — FIFA Forward Enterprise, or FFE — that would control the business side of the World Cup has faced swift backlash. UEFA, the governing organization of European soccer, and Concacaf, the organization controlling North American, Central American and Caribbean soccer, have both rejected the proposal out of concern for outside influence. FIFA said earlier this week it plans to raise $4.2 billion from third parties, valuing FFE at about $20 billion. Thrive Capital, a private equity firm led by Joshua Kushner, has already backed the plan. But on Thursday, UEFA threatened to boycott FIFA competitions and the World Cup if the plan moves forward. "The World Cup cannot be treated as an investment product," UEFA said in a statement. "No part of it should ever be surrendered to private investors. The World Cup is not for sale." FIFA defended the proposal late Thursday night, saying it would move forward with a vote among its member associations despite mounting criticism. UEFA and Concacaf together represent 96 of the 211 members of FIFA. "We respect the feedback and concern aired in public and reaffirm our commitment to an open and democratic consultation," its statement read. "No single entity can claim to represent all 211 member associations around the world." FIFA blamed "incorrect media reports" for the negative response to the plan and said that without the support of a majority of the member associations, its commercial activities would remain unchanged and FFE would not move forward. Carlos Cordeiro, a senior advisor to FIFA President Gianni Infantino, announced his immediate resignation in protest of the plan. "Let me be clear: I had no involvement in this proposal, and I oppose it unequivocally. It is a bad deal for FIFA's Member Associations, a bad deal for football, and a bad deal for the long-term future of the game," Cordeiro said in a statement posted to LinkedIn Friday. While there's no certainty that bringing on institutional capital would affect FIFA operations, it opens the door to outside influence driven by financial gain. While neither UEFA nor Concacaf specifically brought up FIFA's past ties to alleged bribery, but UEFA did cite the soft pressure of shareholder influence as one of the reasons for its rejection of FIFA's plan. "Football's future cannot be dictated by the expectations of those whose first duty is to maximise financial return," UEFA said. "The moment external investors acquire ownership interests in FIFA competitions, football changes forever. Commercial return becomes a permanent obligation. Investor expectations become a daily pressure."

FIFA tests the limits of private equity in sports with World Cup subsidiary sale
North America
CNBC Finance

How Leopold Aschenbrenner built a $45 billion AI hedge fund — and lost most of it in days

Two years ago, Leopold Aschenbrenner argued he was one of few people in the world who saw the future clearly. In a sprawling, 165-page essay that became required reading in Silicon Valley, the former OpenAI researcher positioned himself as a kind of prophet for the coming age of artificial super intelligence. But this week, the limits of Aschenbrenner's vision were on display when the AI-themed hedge fund he runs — named Situational Awareness, also the title of his viral June 2024 manifesto — ran into the harsh reality of tumbling semiconductor stocks and Wall Street margin calls. At its peak earlier this month, his fund sat atop $45 billion in assets. By Thursday, however, after being forced to offload all of his leveraged stock bets — including hard-hit names like SK Hynix and CoreWeave — to Ken Griffin's Citadel at a discount, the fund's holdings plunged to around $10 billion, according to people with knowledge of the situation. The story of Aschenbrenner's meteoric rise and sudden fall has captivated both Wall Street and tech circles, making him the most high-profile casualty yet of the volatility accompanying the AI boom. A polarizing figure, his online followers saw Aschenbrenner — a Columbia University valedictorian at age 19 — as a genius of the next big thing and followed his fund's quarterly filings for clues on hot AI stocks. Before this month's decline, Situational Awareness racked up gains of more than 1,000% since inception, The Wall Street Journal reported last month. The Journal noted Aschenbrenner was just 24 years old. Meanwhile, critics pointed out that Aschenbrenner had no experience running money prior to launching his fund in July 2024, calling him more lucky than smart. Some noted that his early work experience was at the doomed crypto firm FTX, where he helped now-disgraced founder Sam Bankman-Fried run a charity out of a Bahamas penthouse. Others on Wall Street, including former traders at global investment banks, noted that in light of reports Situational Awareness used as much as 400% leverage, the collapse wasn't shocking. "A lot of people saw this blow-up as a matter of not if, but when," said Jerry Diao, who runs a Wall Street coaching firm. "Maybe his views on AI are correct in the long run, but in the public markets, you have to be prepared for the short-term." Earlier this week, before the sale to Citadel, about two-thirds of Situational Awareness holdings were in long and short positions in public equities, according to one source. The rest were stakes in private companies, dominated by a multibillion-dollar Anthropic investment, the person said. CNBC's sources spoke on the condition of anonymity to discuss nonpublic details.

How Leopold Aschenbrenner built a $45 billion AI hedge fund — and lost most of it in days
Europe
BBC Business

Faisal Islam: Four reasons why Fifa's World Cup plan never stacked up

Image source, ReutersByFaisal IslamEconomics editorPublished1 August 2026Documents that set out Fifa's plan to part-privatise the World Cup and seen by the BBC show why the deal may have fallen apart. The sales pitch was circulated to Fifa members this week, setting out the case for Gianni Infantino's controversial plan featuring pictures of the Spain team lifting the trophy and Argentina's fans. The 25-page deck of slides painted a picture of American football-level revenue expectations, which pointed to a potential continuation and extension of the controversial 2026 US-influenced World Cup model. It suggested there was the potential for $1,000+ tickets, dynamic pricing, and pressure to put broadcasting of the world's biggest sports tournament behind a paywall. The documents make it clear that the plan and Fifa's arguments never really stacked up. Here are four reasons why. In the slides, Fifa's central argument was that football does not raise enough cash in relation to its fan base, that "Fifa has been under-monetised versus other leagues" and so "global football development gets squeezed". It did this with reference to a comparative chart showing annual revenue as well as revenue per fan for Fifa, the Uefa Champions League, Premier League, US baseball and NFL American football. On the face of it, Fifa is the poorer cousin at just $1 per global fan, compared to NFL's $52.80. But this measure is rather suspect. The World Cup is not an annual competition - it happens once every four years. If instead this was done on revenue per World Cup 2026 match, Fifa makes multiples of the Premier League, perhaps more than three times as much. As important, football is decentralised globally, so more of the revenues go to individual leagues, such as the Premier League or Champions League. Fifa was effectively arguing it wanted to keep more of that overall football pie. Football's fans are also spread across the globe, in rich and poor countries alike. NFL has a much smaller base concentrated in the US and is pretty much the whole of American Football. Finally, about half of NFL's revenues are paid out as wages. Fifa does not pay Erling Haaland or Lionel Messi or Vozinha. Profits would have yielded a rather different result than the chart’s focus on revenues.

Faisal Islam: Four reasons why Fifa's World Cup plan never stacked up
Asia
The Hindu BusinessLine

Micron, SK hynix, Oracle, SpaceX, Google, Microsoft et al: AI’s dotcom deja vu

The AI debate has never been hotter and to say that the bears won the argument last month would be an understatement. Any doubts? Look up South Korean stock markets. The benchmark KOSPI Composite Index completed ‘a month to forget’ in July with a loss of 22 per cent. This is the third worst month in the index’s history, after the 27 per cent crash during the Asian financial crisis of October 1997 and 23 per cent plunge during the global financial crisis in October 2008. The country, which raced to a stock market capitalisation of $5.1 trillion as of June peak, has now seen $1.2 trillion of that wealth erode in a matter of weeks — a brief demonstration of the possible fallout if the AI trade were to go South across the globe. The reason? Semiconductor stocks SK hynix and Samsung Electronics, which roughly account for 50 per cent of KOSPI companies’ market cap, slumped 20 per cent and 24 per cent respectively to intra-week lows (versus previous week close) — the very stocks that took the Korean stock market to record highs. . That is not all. The rout was more intense in products such as single-stock leveraged ETFs. These are high risk funds that use derivatives to multiply the daily returns of an underlying stock. For instance, the CSOP SK Hynix Daily (2x) Leveraged Product ETF. This ETF will gain 2 per cent if SK hynix gains a per cent in a day and lose 2 per cent if the stock loses 1 per cent in a day. From its 52-week high on June 25, this ETF has lost over 78 per cent! Products like these and leveraged exposures to chip stocks have wiped out the portfolios of thousands of Korean investors. The situation is so dire that their finance minister apologised and admitted that such leveraged products were introduced without careful consideration. While the impact has been most dramatic in South Korea, that is partly because its stock market had become, in effect, a concentrated bet on the AI trade. However, this unwind is no longer a Korea-only story and AI-theme stocks have been under pressure across markets. We looked at 16 stocks which are front-runners of the AI theme. The list spans across hyperscalers, chip design (Nvidia, Broadcom), semiconductor manufacturing, neoclouds (CoreWeave, Nebius) and an AI investor/ financier in SoftBank. From their 52-week highs, these stocks are down 30 per cent on average (Chart 1). From the said peaks, they have erased investor wealth of about $6 trillion. One of the starkest examples is Oracle. Last year, after it announced Q1 FY26 results in September, the stock zoomed about 43 per cent to a 52-week high, reflecting the recklessness in the AI mania. Today its correction of 62 per cent reflects the concerns building up. Many of them are part of S&P 500, accounting for about 30 per cent of the index’s total market-cap and earnings. Between 2025 and 2026 (consensus estimate), the total net income of the index’s constituents is expected to move from $2.1 trillion to $2.9 trillion. Of this incremental income of about $840 billion in 2026, the said AI constituents account for one in three dollars — showing the weightage of these companies (Chart 2). Further, the index P/E multiple, based on CY25 net income is at 33x, which is a valuation that falls in the bubble territory. However, based on CY26 earnings estimates, the P/E cools to 23x. This expected earnings growth is the thin line dividing the debate between the bulls and the bears. If, unfortunately, these companies fail to meet earnings expectations, the index being in bubble territory, brings back memories of dot-com crash in which the S&P 500 corrected 50 per cent and the Nasdaq Composite 78 per cent from 2000 peak to troughs in late 2002. So, does the market’s disappointment stem from earnings? Apparently not, as these companies have delivered earnings beat almost all the time in the last four quarters. The problem appears to be capex of astronomical proportions. Take Alphabet’s case. The company reported Q2 2026 earnings on July 22. Revenue grew 24 per cent year-on-year and operating income 30 per cent. Its cloud revenue (20 per cent of consolidated revenue) grew a staggering 82 per cent. Profit growth was muted relative to revenue growth at around 16 per cent after adjusting for one-offs. But what spooked the Street was the company raising full-year 2026 capex guidance from $195 billion to $205 billion. It also posted its first quarter of negative free cash flows. What added fuel to the fire was the management admitting that free cash flows will remain under pressure driven by capex and that capex will continue until it sees an ‘attractive return on that investment’. Meta Platforms came up with Q2 results on Wednesday. Revenue beat expectations. But it barely ended up free cash flow positive with $784 million as against $8.5 billion in Q2 2025. Amazon’s Q2 results on Thursday revealed that it continued to turn negative free cash flows for the quarter, similar to Q1. The company upped capex guidance from $200 billion to $220 billion for 2026. The fact that companies are spending big time on capex and that free cash flows would drain is not a recent development, per se. It’s only now that the market is waking up to smell the coffee. As Keynes said, “Markets can remain irrational longer than you can remain solvent.” The top hyperscalers, neoclouds, Meta Platforms alongside newly-listed SpaceX (xAI) are expected to incur capex of over $2.16 trillion in fiscals ending in 2026 and 2027, per Bloomberg consensus (Chart 3). This is around half the size of India’s economy! Also, rising capex has meant a clear downtrend in the fixed assets turnover ratio of hyperscalers (Chart 11).

Micron, SK hynix, Oracle, SpaceX, Google, Microsoft et al: AI’s dotcom deja vu
Asia
The Hindu BusinessLine

ICICI Prudential Flexicap: Conviction behind the flexibility

Indian equities still benefit from healthy domestic growth and improving earnings, but valuations and prospects vary sharply across large, mid and small companies. Flexi-cap funds can shift between these segments as opportunities change, giving investors diversification, professional stock selection and a more adaptable route through today’s uneven and volatile market. We recommend ICICI Prudential Flexicap Fund for investors who can remain invested for at least five years. It suits those willing to accept sizeable equity swings for better long-term return potential. Since its July 2021 launch, the fund has built a credible performance record and a distinct portfolio. We covered the fund during its new fund offer and reviewed it again in August 2024. Since then, it has grown in size further (₹22,500-crore AUM now) and sharpened its choices. The fund now combines a large-cap base with a sizeable small-cap allocation. It also carries strong positions in automobiles, retail and other consumer-facing businesses. Note, this is not a fund that closely follows the market. It takes meaningful stock, sector and market-cap positions. That can lift returns when its calls work. It can also create periods of sharp underperformance. Here is the fund review. The fund is the seventh-largest scheme among 45 flexi-cap funds in the market. Size provides operating stability and research depth. It also makes liquidity important, especially in smaller companies. Large-caps formed 62.59 per cent of the portfolio. Mid-caps accounted for 9.71 per cent, while small-caps made up 24.47 per cent. Other assets formed the balance. The flexi-cap category portfolio had around 64 per cent in large-caps and 15 per cent in mid-caps. Its small-cap exposure was about 11 per cent. ICICI Prudential Flexicap, therefore, held more than twice the category’s aggregate small-cap allocation. Its mid-cap exposure was notably lower. This positioning was built gradually. In June 2023, large-caps formed 76.99 per cent of the fund. Small-caps accounted for only 9.70 per cent. By June 2026, large-caps had fallen by over 14 percentage points. Small-caps had risen by almost 15 points. The allocation barely changed during the latest year. The fund’s “dynamic” approach has, therefore, meant a measured three-year shift. It has not meant constant movement between market segments. The fund uses wider economic and valuation signals mainly for large-cap choices. It relies more on company-level research in mid-caps and small-caps. Around 60-65 per cent is intended as a core growth portfolio. The rest can include cyclical and contrarian opportunities. The current portfolio is built heavily around domestic demand. Automobiles formed 18.41 per cent in June 2026. Banks accounted for 16.99 per cent. Retailing made up 10.75 per cent. Consumer durables and auto components added another 14.40 per cent. By a broad grouping, mobility and consumption-linked businesses formed nearly half the portfolio. The fund held much more in automobiles, retail and consumer durables than the category. It held less in banks, pharmaceuticals and software services.

ICICI Prudential Flexicap: Conviction behind the flexibility
North America
CNBC Finance

‘Spider-Man: Brand New Day’ sets domestic box office preview record with $72 million

Sony and Marvel's "Spider-Man: Brand New Day" secured $72 million in preview ticket sales, the highest collection for any domestic film in Hollywood history. The previous record holder was 2019's "Avengers: Endgame," which tallied $60 million ahead of its opening weekend. "The demand for 'Spider-Man: Brand New Day' is nothing short of astonishing," said Paul Dergarabedian, head of marketplace trends at Rentrak. "For a film to earn more than $70 million in pre-shows is unprecedented, and it reflects massive enthusiasm among moviegoers to head to the multiplex for the latest Marvel epic." The newest solo Spider-Man film starring Tom Holland benefited from Wednesday early access screenings as well as Thursday night previews. It is expected to haul in around $270 million domestically over its debut weekend, although some box-office analysts foresee an even bigger bounty. The previous Spidey flick, "Spider-Man: No Way Home" currently stands as the second-highest domestic opening of all time with $260 million across its debut weekend in 2021. "Endgame" tallied $357 million during its first three days in theaters in 2019. "Brand New Day" is expected to surpass "No Way Home," but remain behind "Endgame." "While pre-shows are a very strong indicator of potential opening-weekend success, several factors can come into play, including a heavily front-loaded preview and opening day driven by fans motivated by the shared urgency of opening-weekend FOMO [fear of missing out]," Dergarabedian said. "Endgame" managed its historic opening weekend with the help of 24-hour showings and extra screenings. There are late-night and early morning screenings of "Brand New Day" to meet demand for tickets, but it's unclear if the programming is on the same scale as it was for "Endgame." And, "Brand New Day" does not have the added benefit of an Imax release, as those screens have been reserved for Christopher Nolan's and Universal's "The Odyssey." The Spider-Man installment will still benefit from premium large format screenings, however. The film has been programmed for ScreenX, 4DX, Dolby Cinema and HDR by Barco as well as premium offerings that are proprietary to the likes of AMC, Regal, Cinemark and regional players. ScreenX represented $1.8 million in Thursday ticket sales domestically and is expected to reach $4 million by the end of the weekend. Meanwhile, 4DX has tallied around $1.3 million domestically and is set to hit $4.5 million over the three-day debut. "Brand New Day" arrives at the tail end of July, and the bulk of its box office will be reflected during the month of August. That's good news for the domestic box office. Typically, August is the softest month on the summer movie calendar. With "Brand New Day," the theatrical industry gets a momentum boost heading into the fall movie season. The domestic box office has collected $5.6 billion in ticket sales this year through Sunday. That's 16% behind 2019 levels, the last benchmark before the Covid pandemic shuttered movie theaters and paused productions. However, the 2026 summer corridor is down just 9% from the 2019 comparison, standing at $3.05 billion versus $3.36 billion seven years ago.

‘Spider-Man: Brand New Day’ sets domestic box office preview record with $72 million
Asia
The Hindu BusinessLine

Q1 Results Today Live: Divis Laboratories, Muthoot Finance, APL Apollo Tubes, Gujarat Ambuja Exports, Clean Science & Technology to announce Q1 results

(PTI) GHCL Ltd, India’s largest single-location soda ash maker, on Saturday reported a 32 per cent rise in first-quarter profit to Rs 191.18 crore, helped by lower expenses, even as total income fell. The Gujarat-based chemical maker had posted a net profit of Rs 144.78 crore a year earlier, it said in a regulatory filing. Total income fell 3.06 per cent to Rs 798.01 crore from Rs 823.19 crore a year earlier, while total expenses declined to Rs 594.10 crore from Rs 627.96 crore. Muthoot Finance posted a 25% rise in Q1 FY27 profit to ₹2,550 crore as gold loan AUM jumped 44%, driven by strong demand and record loan growth. APL Apollo Tubes Limited board approved participation in the proposed incorporation of a Group Shared Services Company (SSC), with an investment of up to 20 per cent of its equity share capital for an amount not exceeding ₹1 crore. Upon incorporation, the SSC is expected to qualify as an Associate Company of APL Apollo Tubes. The proposed entity will provide common corporate support services to participating group companies through a centralised shared services model. The Finance Committee of the Board was authorised to execute all necessary steps to operationalise the proposal. The board also took note of a separate decision by Apollo Metalex Limited (AML), a material subsidiary of the company, to rationalise its manufacturing operations. AML plans to consolidate production from its A-25 unit at Sikandrabad, Uttar Pradesh, into other group manufacturing facilities, and will consequently dispose of the land and building at that unit. The company stated the move is aimed at improving capacity utilisation, reducing operating costs, and freeing up capital for core manufacturing and growth. APL Apollo said the consolidation will be phased and is not expected to affect overall production volumes or customer commitments. On the financial front, consolidated revenue from operations for the June 2026 quarter stood at ₹5,606.71 crore, compared to ₹5,169.77 crore in the same quarter last year. Net profit for the quarter came in at ₹263.11 crore against ₹237.17 crore a year ago. Sarda Energy & Minerals Ltd reported a standalone net profit of ₹318.57 crore for the first quarter ended June 30, 2026, a decline of roughly 17.5 per cent compared to ₹386.05 crore in the same quarter last year. Standalone total income fell to ₹1,232.55 crore from ₹1,377.47 crore in Q1 FY26, while revenue from operations came in at ₹1,162.54 crore against ₹1,307.09 crore a year ago. Total expenses declined to ₹808.45 crore from ₹866.93 crore. Basic earnings per share stood at ₹9.04, down from ₹10.96 in the year-ago period. On a consolidated basis, the company fared better. Net profit attributable to the owner stood at ₹458.25 crore, up from ₹434.36 crore in Q1 FY26, aided partly by ₹110.21 crore in net positive impact from recognition of additional revenue and interest income related to the Sikkim Hydropower project following regulatory approval of its final project cost. Among segments, the Power division was the standout performer on a standalone basis, with segment profit of ₹312.92 crore, up sharply from ₹173.55 crore in the previous quarter ended March 2026, though lower than ₹377.44 crore in Q1 FY26. Steel and Ferro Alloys segments both saw year-on-year profit declines. The board also approved seeking shareholder consent to raise funds up to ₹1,000 crore through debt instruments. The record date for dividend payment for FY 2025-26 has been fixed at August 14, 2026.

Q1 Results Today Live: Divis Laboratories, Muthoot Finance, APL Apollo Tubes, Gujarat Ambuja Exports, Clean Science & Technology to announce Q1 results
Asia
The Hindu BusinessLine

Who Am I? August 2, 2026

Here’s a challenge. Using the five clues below, identify the company that is being talked about here. 1 Began my journey as a JV with an overseas partner whose country’s name I still carry in my corporate name, though I have completely bought them out. 2 I was listed only on a regional stock exchange for a decade before getting listed on the national stock exchanges. 3 My chairman earned his master’s from IIM Ahmedabad, and his son graduated from Stanford. 4 I have delivered a CAGR of more than 20 per cent to my shareholders over the last decade despite a return on equity of under 12 per cent. 5 Both FIIs and DIIs own negligible stakes, and no non-promoter shareholder owns more than 1 per cent. Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments. We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.

Who Am I? August 2, 2026