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Mark Zuckerberg says White House pressured Facebook on Covid-19 content; Ryanair says fare declines ‘levelled off’ – business live

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Mark Zuckerberg says White House pressured Facebook on Covid-19 content; Ryanair says fare declines ‘levelled off’ – business live

Mark Zuckerberg says White House put pressure on Facebook over Covid-19 content

Meta boss Mark Zuckerberg has said the US government under Joe Biden put pressure on the Facebook social network to “censor certain Covid-19 content” during the coronavirus pandemic.

Zuckerberg said that “senior officials” from the White House “repeatedly pressured our teams for months to censor certain Covid-19 content, including humour and satire”, in a letter to the US House of Representatives’ judiciary committee. He wrote:

I believe the government pressure was wrong, and I regret that we were not more outspoken about it. I also think we made some choices that, with the benefit of hindsight and new information, we wouldn’t make today.

Meta chief executive Mark Zuckerberg speaks during a Senate Judiciary Committee hearing with other social media platform heads on Capitol Hill in Washington in January. Photograph: Susan Walsh/AP

Zuckerberg also said that Facebook “temporarily demoted” a story about the contents of a laptop owned by Hunter Biden, the president’s son, after a warning from the US Federal Bureau of Investigation (FBI) that Russia was preparing a disinformation campaign against the Bidens.

Zuckerberg wrote that it has since become clear that the story was not disinformation, and “in retrospect, we shouldn’t have demoted the story”.

The admissions will probably fuel criticisms of tech companies and the Biden administration by Republicans. They control the judiciary committee, and posted Zuckerberg’s letter on – of all places – the committee’s Facebook page. “Big win for free speech”, the page’s administrators wrote in the post containing the letter.

Zuckerberg also said he would not donate money towards US election infrastructure, after facing criticism from Republicans that similar donations in 2020 benefited the Democratic party.

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Key events

Some of the shine has come off European stock markets. The FTSE 100 is now only up by 0.2%.

London’s benchmark index has not been helped by weakness in the property industry. Developer Berkeley Group is the biggest faller, down 2.7%, while Persimmon, Barratt Developments, Vistry Group and Taylor Wimpey are all down by between 1.9% and 2.3%.

Mark Zuckerberg says White House put pressure on Facebook over Covid-19 content

Meta boss Mark Zuckerberg has said the US government under Joe Biden put pressure on the Facebook social network to “censor certain Covid-19 content” during the coronavirus pandemic.

Zuckerberg said that “senior officials” from the White House “repeatedly pressured our teams for months to censor certain Covid-19 content, including humour and satire”, in a letter to the US House of Representatives’ judiciary committee. He wrote:

I believe the government pressure was wrong, and I regret that we were not more outspoken about it. I also think we made some choices that, with the benefit of hindsight and new information, we wouldn’t make today.

Meta chief executive Mark Zuckerberg speaks during a Senate Judiciary Committee hearing with other social media platform heads on Capitol Hill in Washington in January. Photograph: Susan Walsh/AP

Zuckerberg also said that Facebook “temporarily demoted” a story about the contents of a laptop owned by Hunter Biden, the president’s son, after a warning from the US Federal Bureau of Investigation (FBI) that Russia was preparing a disinformation campaign against the Bidens.

Zuckerberg wrote that it has since become clear that the story was not disinformation, and “in retrospect, we shouldn’t have demoted the story”.

The admissions will probably fuel criticisms of tech companies and the Biden administration by Republicans. They control the judiciary committee, and posted Zuckerberg’s letter on – of all places – the committee’s Facebook page. “Big win for free speech”, the page’s administrators wrote in the post containing the letter.

Zuckerberg also said he would not donate money towards US election infrastructure, after facing criticism from Republicans that similar donations in 2020 benefited the Democratic party.

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Updated at 

Airline share prices rise after Ryanair says fare declines will be limited

European airlines have risen across the board after Ryanair boss Michael O’Leary said the worst-case fare falls (from investors’ perspective rather than consumers) had been avoided.

EasyJet gained by 4.3%, Wizz Air gained 7% and British Airways owner International Airlines Group rose by 1.4%. Frankfurt-listed Deutsche Lufthansa and Paris-listed Air France KLM rose by 2.6% and 2% respectively.

A Boeing 737 flown by Ryanair. Boeing has struggled to deliver more 737-Max planes on time. Photograph: Pau Barrena/AFP/Getty Images

Ryanair boss Michael O’Leary has given typically short shrift to plane manufacturer Boeing, saying that relations with the new management are “difficult”.

Boeing is struggling to increase the production rate for its aircraft after another year of crisis. In January a door plug panel blew out from a flight, renewing regulatory scrutiny of the company after years of trying to repair the damage from two fatal crashes in 2018 and 2019 that were caused by design flaws.

Ryanair, the biggest airline in Europe, is one of Boeing’s biggest customers. O’Leary, a tough negotiator, is rarely one to pull his punches.

O’Leary told Reuters in an interview on Tuesday that things with Boeing are “difficult”. The Irish airline was due to receive seven and 10 new aircraft from Boeing in July and August respectively, but will only received ten in total, he said.

Ryanair is working with Boeing’s new management, after Stephanie Pope took over its commercial aviation arm, but “they continue to disappoint us”, O’Leary said.

Ryanair shares rise as O’Leary says fare decreases will be limited to 5%

Ryanair chief executive Michael O’Leary speaks during a press conference in 2023. Photograph: Evelyn Hockstein/Reuters

Ryanair shares have risen after boss Michael O’Leary said that fares will fall by less than 10%, reassuring investors who had feared steeper reductions in prices.

The Irish airline alarmed the aviation industry last month when it warned that fares could drop by more than 10% as it missed analyst estimates for sales.

O’Leary on Tuesday said that he expected a fall of about 5% compared with last year, in an interview with Reuters. That prompted a 4.6% rally in the Dublin-listed airline’s share price, although it remains down by 17% over the course of this year.

The risk of what O’Leary at the time called an “ugly scenario” of double-digit falls in average fares “looks like it has disappeared,” O’Leary said. That suggests that passengers are happier to pay more for flights.

O’Leary said:

While fares were kind of softening during April, May and June, that has leveled out.

Germany is struggling so much because it is facing cyclical headwinds at the same time as deeper structural changes, said Carsten Brzeski, global head of macro at ING, a Dutch investment bank.

He said:

The German economy had started the year with some optimism. First-quarter GDP growth was a positive surprise and confidence indicators improved, giving rise to hopes that the pessimism of the last few years was behind us, and that discussions about whether or not Germany was the “sick man of Europe” could be put to one side. The truth, however, is that GDP growth in the first quarter was driven by the mild winter weather and a downward revision of fourth quarter GDP. Therefore, it was not what we would call a sustainable and healthy growth story.

With disappointing second-quarter growth and almost all confidence sentiment indicators pointing south, the German economy is currently back where it was a year ago: stuck in stagnation as the growth laggard of the entire eurozone.

Still, we are not ready, yet, to give up on at least some optimism for the second half of the year. The highest increase in real wages in more than a decade could still open German consumers’ wallets and there only needs to be a small improvement in industrial orders to bring the long overdue turning of the inventory cycle. Admittedly, hopes of a consumer-driven recovery in the second half of the year got another hit this morning with consumer confidence dropping.

The numbers from Germany’s economy are not very promising, but there may well be some reasons to be hopeful, said Melanie Debono, senior Europe economist at Pantheon Macroeconomics, a consultancy.

There have been worrying signs from business surveys, today’s GDP figures show very weak business investment, and today’s GfK consumer sentiment numbers are not very promising for spending. Yet Debono said it is not all bad.

She said:

The recession in industry [reasserted] itself after signs it may have been fading in previous months. Investment in machinery and equipment will likely remain in the doldrums.

But inventories, we think, are on the cusp of a sustained rebound. We still believe, meanwhile, that consumers’ spending, will rebound on the back of the improvement in real income growth. Today’s other release, showing consumer confidence fell back at the end of the third quarter, bodes ill but these data have only a weak relationship with retail sales and consumers’ spending figures more widely.

On the Paramount bid battle, here is what the various parties had to say.

Edgar Bronfman officially dropped out of the running on Monday evening. Reuters reported that a source said that some of the equity partners had dropped out.

Bronfman said in a statement:

We continue to believe that Paramount Global is an extraordinary company, with an unrivaled collection of marquee brands, assets and people. While there may have been differences, we believe that everyone involved in the sale process is united in the belief that Paramount’s best days are ahead.

Paramount said the deal with Skydance will close in the first half of 2025.

Charles Phillips Jr, chair of Paramount’s special committee, said:

Having thoroughly explored actionable opportunities for Paramount over nearly eight months, our special committee continues to believe that the transaction we have agreed with Skydance delivers immediate value and the potential for continued participation in value creation in a rapidly evolving industry landscape.

The biggest gainer on the FTSE 100 this morning is Bunzl, which distributes packaging, cleaning products and personal protective equipment.

It may not be the most glamorous name on London’s benchmark index, but it has wowed investors this morning with a big upgrade to its profit forecast thanks to higher profitability.

It also said it will buy back shares worth £450m. Frank van Zanten, chief executive of Bunzl, said:

I am very pleased with the performance of the group during the first half of 2024, with strong growth in adjusted operating profit for the period.

London’s FTSE 100 is the pick of Europe’s stock markets this morning, as investors catch up from a bank holiday on Monday.

Most of the other main indices are fairly flat in the opening trades. Here are the opening snaps, via Reuters.

  • EUROPE’S STOXX 600 UP 0.2%

  • BRITAIN’S FTSE 100 UP 0.4%

  • FRANCE’S CAC 40 UP 0.1%; SPAIN’S IBEX FLAT

  • EURO STOXX INDEX FLAT; EURO ZONE BLUE CHIPS FLAT

German GDP down 0.1%; Bronfman drops Paramount bid

Good morning, and welcome to our live coverage of business, economics and financial markets.

Germany’s economic outlook has worsened as GDP was confirmed to have fallen in the second quarter and consumer sentiment slumped, according to figures published on Tuesday.

GDP fell by 0.1% in the second quarter, confirming the previous estimate, said Destatis, the federal statistics office. GDP in the first quarter of 2024 was up 0.2% on the previous quarter, unrevised from the last reading.

Meanwhile job concerns weighed on German consumer sentiment. GfK’s closely followed index fell to -22 points for September. That was down from a slightly revised -18.6 the month prior and below a forecast by economists polled by Reuters for -18.2.

Ruth Brand, Destatis’s president, said:

After the slight increase in the previous quarter, the German economy slowed down again in spring.

Germany’s economy has narrowly avoided a technical recession for a year and a half, alternating between a contracting economy followed by expansion. Two consecutive quarters of contraction is one commonly used definition of recession.

Germany’s GDP growth rate has narrowly avoided a technical recession since early 2023, alternating between contraction and expansion each quarter. Photograph: Trading Economics

Edgar Bronfman drops bid for Paramount

Media industry veteran Edgar Bronfman has dropped his bid to take over Paramount Global, paving the way for a $28bn (£21bn) deal with Skydance to proceed.

Bronfman, a former Warner Music chief executive, had gathered a consortium of investors to try to gazump Skydance after it last month agreed a merger (described, of course, as a blockbuster) with Paramount. The deal will, if it goes through, sever links with the Redstone family, whose media empire has included Paramount since 1994.

That deal had a “go shop” period in the terms, allowing Paramount to evaluate other offers. Bronfman gathered a consortium to offer $4.3bn and then $6bn to Shari Redstone, who controls the company. However, he failed to come up with the equity to finance the deal, Reuters reported, citing unnamed sources.

Paramount is the company behind classic films such as The Godfather, Titanic and Breakfast at Tiffany’s. It also owns the television network CBS and channels including MTV, Nickelodeon and the UK’s Channel 5.

Skydance, a film production group, is led by the producer David Ellison, the son of Larry Ellison, the tech tycoon who co-founded Oracle.

The agenda

  • 11am BST: UK Confederation of British Industry distributive trades index (August; previous: -43; consensus: -11)

  • 2pm BST: US S&P/Case-Shiller home price index (June; prev.: 6.8% year-on-year; cons.: 6%)

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