What’s next for US Steel?

Key takeaways

UK businesses anticipate raising prices due to increased labor costs, which poses a challenge to their confidence.
President Biden's rejection of the US Steel-Nippon merger highlights the complexities of national security and domestic industry reliance.
CrowdStrike has effectively managed its post-crisis recovery, maintaining high customer retention and substantial revenue growth.
The European Central Bank faces criticism for not cutting rates swiftly enough to support economic growth.
Chinese cinema struggles as viewers shift to streaming, compounded by economic factors and fewer major film releases.

Summary

UK Businesses and Price Increases

A new survey from the British Chambers of Commerce reveals that over half of UK companies are planning to raise prices, driven by increasing labor costs and a decision by the government to raise the living wage and national insurance contributions. This has led to a confidence slump among businesses as they head into 2025.

US Steel and Biden's Blocked Merger

President Joe Biden's decision to block the takeover of US Steel by the Japanese firm Nippon arises from concerns regarding national security and supply chain reliability, particularly for domestic industries that rely on steel production. The outcome leaves US Steel in a precarious financial position, complicating future investments and technological upgrades needed for sustainability.

CrowdStrike's Resilient Comeback

Following a significant IT outage caused by a software update that affected millions, CrowdStrike has rebounded impressively, boasting a 97% customer retention rate and reporting $1 billion in revenue, a 29% increase year-over-year. Analysts credit effective communication and recovery strategies post-crisis, though Delta Airlines has opted to sue for significant damages.

European Central Bank's Slow Rate Cuts

A recent FT survey indicates that many economists believe the European Central Bank (ECB) is lagging in aggressive interest rate cuts necessary to stimulate the stagnating Eurozone economy. Despite previous cuts, growth remains weak, with the IMF forecasting minimal growth in the upcoming year.

China's Theatre Revenue Struggles

Box office revenue in China has plunged nearly 25%, in stark contrast to a mere 3% decline in North America. Economic hardships, including high youth unemployment, have shifted consumer preferences towards streaming services, and a notable absence of blockbuster films has exacerbated this trend.

Show notes

Eurozone economists warn the European Central Bank has been too slow to cut interest rates, and US Steel faces a bleak outlook after President Biden’s decision to block its sale. UK businesses plan price increases as the Budget drives up costs, and CrowdStrike has more than recovered the $30bn in market value it shed last year. Plus, China’s movie theatres are in crisis.

Mentioned in this podcast:

ECB has been too slow to cut rates, Eurozone economists warn

Joe Biden blocks Nippon Steel’s $15bn takeover of US Steel

UK businesses plan price increases as Budget drives up costs

CrowdStrike bounces back after triggering largest IT outage in history

China’s box office takings drop by a quarter as viewers turn to streaming

The FT News Briefing is produced by Niamh Rowe, Fiona Symon, Sonja Hutson, Kasia Broussalian and Marc Filippino. Additional help from Breen Turner, Sam Giovinco, Peter Barber, Michael Lello, David da Silva and Gavin Kallmann. Our engineer is Joseph Salcedo. Topher Forhecz is the FT’s executive producer. The FT’s global head of audio is Cheryl Brumley. The show’s theme song is by Metaphor Music.

Read a transcript of this episode on FT.com

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