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Good morning and welcome back. In today’s newsletter:
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Mamdani wins New York as Democrats triumph in key races
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Russia’s retrofitted ‘dumb bombs’
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Norway suspends ethical investing rules
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Deutsche Bank weighs hedging data centre exposure
We begin in the US, where voters in various cities and states handed down a verdict on President Donald Trump’s second term.
Democratic sweep: Zohran Mamdani has become New York City’s first Muslim mayor, after the democratic socialist scored a resounding victory over former state governor Andrew Cuomo, according to the Associated Press’s projections.
Meanwhile, Democratic candidate Mikie Sherrill has won the race for New Jersey governor, AP projected, defeating Trump ally Jack Ciattarelli. The Democrats also made gains in Virginia, where candidate Abigail Spanberger was elected governor.
Verdict on Trump: The US president’s failure to bring down inflation as promised during his 2024 election campaign was put to the test in yesterday’s vote. Both Spanberger and Sherrill in their campaigns blamed him and the Republicans for high inflation, as did Mamdani.
Trump has touted a rising stock market and investment announcements by big companies as a sign that his economic policies are working and will bring widespread benefits, but voters were sceptical.
Read more on the elections.
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Wall Street reaction: New York’s financial elite has offered cautious support to Mamdani after the Muslim democratic socialist won the city’s mayoral election.
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Trump’s year in charts: Trade wars, executive orders and falling approval ratings have characterised the first 12 months of the president’s second term.
Here’s what else we’re keeping tabs on today:
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Economic data: S&P Global releases services PMI data for Canada, the Eurozone, France, Germany, Italy, the UK and US.
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UK: FT Live’s two-day Future of AI event begins in London and online. Speakers include Nvidia chief executive Jensen Huang. Register here.
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US: The Supreme Court is scheduled to hear challenges to Donald Trump’s tariffs.
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Results: Arm Holdings, Bouygues, DoorDash, Lyft, Marks and Spencer, McDonald’s, Metro Bank, Novo Nordisk, Qualcomm and Snap report earnings. See our Week Ahead newsletter for a fuller list.
Five more top stories
1. Russia has started using jet-powered glide bombs to hit targets deep beyond the frontline, an upgrade to Moscow’s arsenal that could put further strain on Ukraine’s stretched air defences. Read more on the retrofitted Soviet-era “dumb bombs”.
2. Norway has suspended its ethical investing rules to avoid its $2.1tn oil fund being forced to sell out of Amazon, Microsoft and Alphabet due to their work for the Israeli government, the Norwegian finance minister said. Read more remarks from Jens Stoltenberg.
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Climate bonds: China’s green bond market has overtaken its western rivals for the first time this year, as Beijing embraces a form of sustainable finance.
3. Exclusive: Deutsche Bank is exploring ways to hedge its exposure to data centres after extending billions of dollars in debt to the sector to keep up with demand for artificial intelligence and cloud computing. Read more on the options the German lender is weighing.
4. Iran must “seriously improve” co-operation with UN inspectors to avoid increasing tensions with the west, the International Atomic Energy Agency’s head has warned. Rafael Grossi told the Financial Times the IAEA had not been given access to the country’s most important nuclear facilities.
5. Exclusive: Coutts, the private bank to King Charles, is increasing the fees for its least wealthy customers for the first time in almost a decade, following a turbulent period for the NatWest-owned business. Read more on the new charges.
The Big Read
© FT montage/Getty/PA
Europe’s deindustrialising regions are hoping that higher defence expenditure will lead to investment and jobs. But economists warn that the extra money needs to go to research and development, and not just more tanks and artillery shells. Will the spending spree deliver growth?
We’re also reading . . .
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First Brands: Creditors caught in the auto parts group’s collapse are bracing themselves for a clash at this week’s bankruptcy hearing.
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Holding the line: As hostility to reason and evidence spreads, US climate scientist Virginia Burkett offers survival tips to others under fire, writes Anjana Ahuja.
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Financial literacy: All primary and secondary school pupils in England will be taught fundamentals of money as part of a curriculum overhaul.
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Budget stand-off: The bond market remains confident the UK chancellor will not lean on gilt investors to plug the gaps in public finances, writes Katie Martin.
Chart of the day
Raising taxes is unavoidable for the UK government. The only way to do so without damaging economic growth is to replace bad taxes with better ones, writes Martin Wolf.
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Take a break from the news . . .
A handful of art galleries survive their founders. David Juda, who has steered his mother’s Annely Juda Fine Art into the 21st century, shares advice on how to make the business transition to the next generation.
Nina Fellmann and David Juda, co-directors of Annely Juda Fine Art gallery © Hugo Glendinning
