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UK pension funds are moving away from US equities
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The ECB refuses to support the EU’s planned Ukrainian loan
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Ownership claim of Italy’s gold reserves
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Products with the Zara label found in Russian stores
We start in Britain, where pension funds are reducing their exposure to US equities over fears of market concentration in a limited number of technology stocks and the risk of an artificial intelligence bubble.
What you need to know: Schemes that manage more than £200 billion in assets for millions of British savers told the Financial Times they have shifted allocations to other regions or added protection against a possible fall in share prices.
Concentration risk: The tech-heavy Nasdaq Composite index is up more than 20 percent this year, driven by so-called Magnificent Seven stocks like Nvidia, Alphabet and Meta.
This has fueled concerns about the dominance of a small number of stocks and the risk of a bubble, which could expose pension savers to a sharp sell-off.
Read where the pension funds are switching to.
Here’s what else we’re keeping an eye on today:
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Economic data: The EU releases flash inflation data for November and unemployment figures for October. The OECD publishes its latest economic forecasts.
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UK: The FT Global Banking Summit kicks off in London and runs until Thursday. Barclays CEO CS Venkatakrishnan, HSBC’s Georges Elhedery and Lloyds Banking Group’s Charlie Nunn will speak. Register here.
Join senior FT editors tomorrow for a discussion about what will shape the year ahead. Register for free today.
Five more top stories
1. Exclusive: The European Central Bank has refused to create a backstop a €140 billion payment to Ukraine, which is a blow to the EU’s plan to raise a “reparation loan” backed by frozen Russian assets. The ECB told the European Commission that such a move would violate its mandate.
2. Lawmakers from Giorgia Meloni’s right-wing coalition are calling for Italy’s gold reserves – the third largest in the world after the US and Germany – to be declared the property of the Italian people. But critics fear the move will pave the way for a government sell-off of the precious metal.
3. French President Emmanuel Macronwho visits Beijing this week is expected to warn about industrial dependence on China. But European companies continue to increase their investments in local factories, which they say helps them compete with Chinese rivals.
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EU competitiveness: The bloc should withdraw the Corporate Sustainability Due Diligence directive, which is killing growth, writes Andrew Puzder, the US ambassador to the EU.
4. Swedish private equity group EQT is considering charging institutional investors more to back its deals as the influx of money from wealthy individuals makes it less dependent on funds from traditional lenders. Read the details of the change.
5. Payments to UK non-executive directors have fallen has risen by more than 10 percent in real terms over the past decade, raising concerns that London-listed companies will struggle to attract experienced board members, research shows. Read the full story.
The great reading
China’s biopharmaceutical companies are developing drugs faster and cheaper than foreign competitors thanks to a surge in investment and improved supply chains. But can the country’s industry match rivals such as AstraZeneca and Pfizer?
We are also reading. . .
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Affordable leggings: Manchester gym-to-coffee shop womenswear brand Adanola is taking on Lululemon, writes John Gapper.
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Reforming the divorce law: A group of women in London have become the best-known and most successful family lawyers of their generation.
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Labor doesn’t work: The British government’s muddled thinking about the economy is causing support to flow in all directions, writes Stephen Bush.
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Budget leak: How the Office for Budget Responsibility, Britain’s “fiercely independent” budget watchdog, fell.
Graphic of the day
The momentum on the battlefield has left the Rapid Support Forces behind in the weeks since the capture of the Sudanese town of El Fasher. After consolidating control over the surrounding region, the ruthless paramilitary is now advancing east and south in an offensive that will roil regional powers and worsen the world’s worst humanitarian catastrophe.
Take a break from the news. . .
Jeanette Winterson returns with a work of nonfiction with the same flavor and power we’ve come to know. One Aladdin two lamps combines her views on a range of contemporary issues with some of the oldest stories we know.
