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  • Daily business and finance update 3rd May 2023

Daily business and finance update 3rd May 2023

House price surprise

Good morning. Today we're talking about the surprising rise in house prices, controversial oil profits, artificial intelligence regrets and Hollywood grinds to a halt.

Big Stories

House price surprise

UK property prices unexpectedly rose for the first time in eight months in April, according to mortgage lender Nationwide after borrowing costs steadied. On a monthly basis, prices went up by 0.5%, while on an annual basis, they fell by 2.7%, improving from the 3.1% decline seen in March. The average house price is now £260,411, 4% below the peak in August. Despite the surprising rise, and with mortgage rates more than double where they were a year earlier, economists are warning the risk of a sustained correction in prices hasn’t disappeared yet. Prices are forecast to fall by 10% or more this year.

Oil profits backlash

Yesterday BP reported bumper profits of £4bn in the first three months of the year. The British energy giant beat analyst expectations and again brought the issue of windfall taxes to the fore. Following Russia’s invasion of Ukraine last year, consumers have faced surging energy bills with oil giants benefiting and recording huge profits. Although energy prices have fallen since the last summer, they are still above pre-war levels. In May the UK government introduced a 25% windfall tax on British profits generated in the North Sea. BP said it had paid £1bn in windfall taxes but the Labour party has vowed to expand the tax if it comes to power.

AI regrets

British-Canadian scientist Geoffrey Hinton — known as one of the “Godfathers of AI” —stepped down from his role at Google’s AI division so he could freely talk about the dangers AI currently poses. Hinton says AI may soon be more intelligent than humans, and that he can’t see how to prevent “bad actors from using it for bad things” such as spreading misinformation and deploying autonomous weapons or “robot soldiers”. He sees the situation getting much worse if Google, Microsoft, and others don’t pause their AI arms race to assess the risks.

Hollywood on hold

Hollywood television and film writers are on strike for the first time in 15 years. The Writers Guild of America, which represents 11,500 writers, is trying to negotiate a contract that they say is fit for a new streaming-centric industry. The union says that its members have suffered financially during the streaming boom as they are getting paid less to do more. The strike will immediately take off air late-night talk shows followed by soap operas. And if the strike drags on, other programming will be impacted too. The last strike in 2007 lasted 100 days prompting studios to turn to more reality TV.


Striking a deal: More than a million NHS workers will get a 5% pay increase – plus a one off cash payment for last year, after unions agreed to accept the government’s offer.

Banking profits: HSBC reported a sharp rise in profit in the first quarter, driven by bumper interest income and its purchase of collapsed Silicon Valley Bank's British business.

On the brink: Vice, the global news publisher and TV company that was once valued at nearly $6bn is reportedly close to filing for bankruptcy.

Delivering growth: Uber reported a jump in profits in the first quarter after a surge in demand for travel and food delivery.

Russian exit: The owner of the dating apps Tinder and Hinge has announced it will stop operating in Russia, more than a year after the war in Ukraine broke out.

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