Russian navy trained to target sites inside Europe

Good morning. We start with an exclusive story: Russia has trained its navy to target sites deep inside Europe with nuclear-capable missiles in a potential conflict with Nato, according to secret files seen by the Financial Times.

Maps of targets as far-flung as the west coast of France and Barrow-in-Furness in the UK are detailed in a presentation for officers that predates the full-scale invasion of Ukraine.

The FT has previously reported from the same cache of 29 secret Russian military files that Moscow had rehearsed using tactical nuclear weapons in the early stages of a conflict with a major world power.

The latest revelations show how Russia envisioned a conflict with the west reaching well beyond its immediate Nato frontier, planning for a series of overwhelming strikes across western Europe. The documents were shown to the FT by western sources. Max Seddon and Chris Cook have more on the secret files.

Here’s what else I’m keeping tabs on today:

• Economic data: IEA’s oil market report and the ZEW survey on the German economy for the month are released. The UK has monthly labour market figures while the US publishes July producer price index inflation rate data.

• Results: CSL, HelloFresh, Henkel, Home Depot, Just Group, Porsche and
  Sun Life Financial report.

• Made by Google: The company is expected to launch its latest devices, including the Pixel 9 smartphone. A teaser video released in June said “AI . . . meet IX”.

Robert Armstrong of Unhedged and other FT experts from London to Tokyo will break down the recent trading turmoil in a subscriber-only webinar tomorrow. Don’t miss it.

Five more top stories

1. The US yesterday warned that Iran or its proxies could launch an attack on Israel this week in retaliation for the assassinations of Hamas and Hizbollah leaders. The White House said it was preparing for “what could be a significant set of attacks” in its most specific public assessment of the timing of a potential assault from Tehran.

• Go deeper: Since Hamas’s political leader was assassinated in Iran, the Islamic republic has kept the region on edge, giving few clues on how it will retaliate.

2. German direct investment into China has risen sharply this year, in a sign that companies in Europe’s largest economy are ignoring pleas from their government to diversify into less geopolitically risky markets. Figures from the Bundesbank show that direct investments in China stood at €2.48bn in the first three months of 2024, rising to €4.8bn in the second quarter. Guy Chazan reports what’s driving the uptick in investment.

3. Donald Trump told Elon Musk that internal “enemies” were “more dangerous” than foreign adversaries such as Russia and China in a rambling, two-hour conversation on X that was delayed by glitches. Yesterday’s discussion, billed by the Republican presidential candidate as the “greatest interview ever”, was heard at times by more than 1mn people, according to X. Here’s more on how the conversation unfolded.

4. UK chancellor Rachel Reeves is considering seeking private finance to pay for a £9bn highway and tunnel across the Thames in an effort to keep the costs off the government’s books. Investors in the Lower Thames Crossing would receive returns from the toll road in exchange for bankrolling the project, according to two people close to the Treasury discussions. Read the full report.

5. Exclusive: Blackstone has sold 3,000 homes to the Universities Superannuation Scheme, the UK’s largest private pension fund, for £405mn in the biggest affordable housing deal of its kind. The deal is the first sale by the buyout group from its UK residential portfolio, which includes roughly 20,000 homes. Here’s what the deal means for the housing sector.

The Big Read

Blessed with copious energy from its extensive network of hydropower, Sweden’s far north has experienced a green rush. Thousands of people have flocked to this often snow-covered region that straddles the Arctic Circle to work for companies using the surplus power. The reality has been far from easy. With green industry projects struggling to scale up, can Sweden live up to the hype?

We’re also reading . . . 

• Corporate bonds: Investors are piling back into bonds as recession replaces inflation as markets’ main fear, and fixed income proves its worth as a hedge against the recent stock market chaos.

• Rise of branded games: Companies moving into platforms such as Roblox discover that balancing brand building with entertainment for a community that is wise to ad trickery remains a tough task.

• AI-generated CVs: More job hunters are using ChatGPT and Gemini to polish job applications, flooding recruiters with low-quality applications in an already squeezed labour market.

• South African politics: Pretoria’s unity government is holding together six weeks after it was formed, boosting business confidence.

Chart of the day

There always seems to be a reason BT’s investors are kept on hold. Strategic mis-steps, operational challenges, a hypercompetitive sector and a noisy shareholder roster have kept a lid on the stock. But Bharti’s acquisition of a stake alongside other telco investors is a vote of confidence in the company’s strategy.

Take a break from the news

Artificial intelligence, increasingly used in fashion when it comes to search, ecommerce and customer service, is making inroads into marketing. More recently, AI influencers have become a flashpoint for conversations about inclusion and representation in fashion media. The use of AI however raises questions around who is profiting and what real representation looks like.

Additional contributions from Benjamin Wilhelm and Harvey Nriapia