That’s all for today - here’s our main stories:

Goodnight. GW

Tobacco company Philip Morris International and US private equity group Carlyle could go head-to-head in a rare auction process to resolve the £1bn takeover battle for Vectura, the asthma inhaler maker, my colleague Rob Davies writes.

A five-day auction process will begin on Wednesday if final bids are not forthcoming by 5pm on Tuesday, regulators at the UK takeover panel announced.

Shares in Vectura gained 5% to reach 172p on Monday, valuing the Chippenham, Wiltshire-based company at more than £1bn, as investors responded to the prospect of a continued tug-of-war.

Marlboro maker Philip Morris International (PMI), which advocates a smoke-free future but still makes more than 75% of its revenue by selling cigarettes, put in an increased offer above £1bn over the weekend, trumping an offer from rival suitor Carlyle.

The raised bid from PMI at 165p a share values Vectura at £1.02bn, compared with the 155p offer on the table from Carlyle, which values the firm’s equity at £928m.

Vectura’s board had previously recommended that investors accept the offer from Carlyle but withdrew that recommendation on Monday ahead of a potential auction. ...

Here’s the full story:

Just in: the number of job openings in the US has hit a new record high, at over 10 million.

There were 10.1 million job openings at the end of June, the US Bureau of Labor Statistics reports, the highest on record, and 590,000 more than in May.

That highlights that firms are struggling to attract workers as the economy reopens from the pandemic, even though unemployment is higher than its pre-Covid levels.

Job openings increased in several industries, with the largest increases in professional and business services (+227,000); retail trade (+133,000); and accommodation and food services (+121,000), the BLS says.

Firms did manage to recruit more workers, though. There were 6.7 million hires in June, up 697,000, including in retail trade (+291,000); state and local government education (+94,000); and durable goods manufacturing (+36,000).

Some early reaction:

The oil price is sliding today, hit by worries that the latest curbs to fight the Covid-19 pandemic will hit the recovery.

A stronger US dollar, and a major new warning about the climate emergency, are also weighing on the energy market today.

Brent crude has tumbled by 4%, or $2.90 per barrel, to $67.82, a three week low.

US crude fell as low as $65.15 per barrel, the lowest since late May.

Analysts said that new travel restrictions imposed in China, following a rise in Covid-19 cases, were hitting the oil price as they could mean lower demand for energy and weaker growth.

Those tighter restrictions have included the cancellations of flights and train services, and warnings against travel.

Raffi Boyadjian of XM says:

Fresh travel restrictions in China have added to oil’s downside as the Delta variant continues to delay the full lifting of virus-related curbs in most countries.

Australia has also brought in new curbs, expanding its New South Wales lockdown amid fears that coronavirus has spread from Sydney.

Other commodity prices have also been pulled down by a strengthening US dollar, after last Friday’s upbeat American labor market report showed around 943,000 new US jobs were created last month.

With wages rising, it may mean the Federal Reserve tightens monetary policy sooner.

A new Intergovernmental Panel on Climate Change report, warning that immediate and deep emissions cuts are urgently required, also highlights the need to cut oil production.

My colleague Fiona Harvey explains:

Human activity is changing the Earth’s climate in ways “unprecedented” in thousands or hundreds of thousands of years, with some of the changes now inevitable and “irreversible”, climate scientists have warned.

Within the next two decades, temperatures are likely to rise by more than 1.5C above pre-industrial levels, breaching the ambition of the 2015 Paris climate agreement, and bringing widespread devastation and extreme weather.

Only rapid and drastic reductions in greenhouse gases in this decade can prevent such climate breakdown, with every fraction of a degree of further heating likely to compound the accelerating effects, according to the International Panel on Climate Change, the world’s leading authority on climate science.

Discount voucher business Groupon could be taken to court if it fails to change its ways, according to the competition watchdog, the Press Association reports.

An investigation by the Competition and Markets Authority (CMA) launched in April found that the company does not always provide customers with the refunds or other forms of redress they are legally entitled to.

In some cases the CMA also found that Groupon UK would only offer credits, rather than cash refunds as required under consumer laws.

The company has now been contacted by the watchdog and told to commit to changes or face court action.

Investigators also found that some vouchers cannot always be redeemed within the advertised periods, or descriptions of goods and services were inaccurate or poor quality.

Bosses must also ensure customer services are up to scratch when customers contact them, the CMA added.

As well as potentially breaking consumer protection law, Groupon UK could be in breach of the formal commitments it gave to the CMA’s predecessor, the Office of Fair Trading (OFT), in 2012, it said. As part of these commitments, Groupon UK pledged to ensure information on its website is not misleading and to comply with customers’ legal cancellation and refund rights.

Andrea Coscelli, CMA chief executive, said:

“More people than ever are shopping online, especially over the last year.

“It is therefore essential that online businesses treat customers fairly and refund them money where due under consumer law.

“Groupon must swiftly step up and do right by its customers if it wants to avoid court action.”

Economic optimism in the eurozone has dropped to a three-month low, as investors fret about economist prospects and the risk of new lockdowns.

Research group Sentix has reported that its index of eurozone investor morale fell to 22.2 this month, sharply down on July’s 29.8 and the lowest since May.

Although investors’ view of the current situation was the brightest since October 2018, the future expectations sub-index fell for the third month running, to its lowest since May 2020.

Sentix says:

The global economy is running at full speed, but momentum is weakening. The slowdown in the Asia ex Japan region is also contributing to this. In the Eurozone, the recovery of the current economic situation continues.

Economic expectations among German investors also fell, Sentix adds.

Fears are growing that new lockdowns could loom from autumn onwards with rising infection figures and could once again weigh on the economy.

UK inhaler maker Vectura has now withdrawn its backing for Carlyle’s takeover offer, following Philip Morris’s higher, £1bn bid.

Last Friday, Vectura backed Carlyle’s 155p-per-share offer (£958m), saying the private equity bid was “well aligned with Vectura’s wider stakeholder objectives” as well as being worth more than Philip Morris’s initial offer.

It also noted the concerns about the possibility of the Company being owned by PMI [cancer charities had blasted the idea of Vectura, whose products treat lung disease, being owned by a cigarette maker].

But with PMI now offering 165p per share, Vectura’s board says it will withdraw its intention to recommend the Carlyle Offer. But, it’s not saying whether it plans to recommend the PMI Offer either.

That’s because the Takeover Panel, which regulates such battles, has announced that an auction process lasting up to five days will begin, if Carlyle and Philip Morris do not make final bids by 5pm tomorrow (Tuesday).

That would give both suiters up to five days of public bidding, from Wednesday, to settle the ownership of Vectura.

Shares in Vectura have now pushed higher, up over 5% at 173p, as the City anticipates further bids.

In a statement this morning, Vectura explains:

As there remain two competing bidders for Vectura, in accordance with the City Code on Takeovers and Mergers, the Takeover Panel has today announced rules to govern the basis on which any further offers for Vectura are made after 5.00 pm on 10 August 2021 (the “Auction Rules”).

As a result, the Board feels that it is appropriate to withdraw its intention to recommend the Carlyle Offer and at this stage not to state an intention to recommend the PMI Offer. The Board will make a further announcement after the end of the auction, as set out in the Auction Rules, based on its fiduciary duties, consistent with its approach to date.

The FTSE 100 has started the new week on the back foot, down 25 points points or 0.35% to 7097 points.

Financial services platform Hargreaves Lansdown is leading the fallers, down 10%, after attracting a record number of new customers in the last year, which pushed up its costs.

Hargreaves attracted 233,000 net new clients and £8.7bn of net new business in the period, taking its total client base to 1.645m and assets to £135.5bn.

Chris Hill, chief executive officer, says investing has seen a generational shift, and a move to digital services.

The pandemic has accelerated two trends that were already evident to us: a permanent shift to digital; and a change in the demographic mix. Demand for our digital services has soared with 393 million digital visits and 98% of trades being done online.

In FY21, 83% of our new clients were under 55, as we saw younger clients showing an interest investing and saving, prioritising financial resilience as they benefit from the transition of wealth from older generations.

But this boom is also pushing up Hargreaves Lansdown’s costs; underlying earnings were weaker than expected, as it services “an enlarged and growing client base”.

Operating costs increased by 24% to £266m, as the company took on more staff in order to deal with higher client numbers and activity levels, plus various activity based costs.

Average staff numbers increased by 11% from 1,599 in 2020 to 1,776 in 2021 with the key increases being within the service functions of the Helpdesk and in Operations, driven by the need to support our increased levels of client activity and contact whilst working in a COVID-19 configuration.

On the economic front, German exports have picked up despite the supply chain problems weighing on manufacturers.

German exports jumped 1.3% in June, data this morning shows, the 14th monthly rise in a row, even though factories are facing shortages of components such as computer chips.

That takes exports above their pre-crisis levels, and 23.6% higher than the same month a year earlier when pandemic lockdowns were in force.

Imports were 0.6% higher in June, and 27.0% up on a year earlier.

Destatis adds:

Compared with the same month last year, exports to the United Kingdom were up by 11.0% to €5.5bn in June 2021. German imports from the United Kingdom increased by 11.5% to €2.7bn over the same period.

ING’s Carsten Brzeski says German exporters have staged an impressive recovery:

Today’s strong data illustrates that supply chain frictions have not yet affected German exports. However, looking ahead, this could still change.

While order books are still richly filled, supply chain frictions, particularly the lack of microchips, could lead to more delivery problems in key sectors like the automotive industry and therefore to some distortions of export data in the coming months.

The Serious Fraud Office (SFO) has launched an investigation into entrepreneur Gavin Woodhouse, whose business dealings were revealed by an undercover investigation by the Guardian and ITV News.

The UK’s anti-corruption agency said it was investigating “suspected fraud and money laundering in relation to ... Woodhouse and individuals and companies associated with him”.

It added:

“The conduct currently under investigation by the SFO relates to investments offered in care homes and hotels between 2013 and 2019.”

Woodhouse raised more than £80m from amateur investors over several years to build care homes and buy and refurbish hotels, promising generous returns.

The Guardian and ITV News revealed in June 2019 that many of the projects were incomplete, several years after they were due to be operational, while the businessman’s firms had a multimillion-pound black hole.

At the time, several investors, who in some cases had paid hundreds of thousands of pounds into Woodhouse projects, said they had not received the annual dividends they had been promised.

Here’s the full story:

Shares in online delivery firm Deliveroo have surged by 10% in early trading, after it reported that Germany’s Delivery Hero has taken a 5.09% stake.

The news of Delivery Hero’s stake-building has pushed Deliveroo as high as 360p, their highest level since floating on the London stock market this spring.

Deliveroo floated at 390p at the end of March, and promptly plunged by a quarter, in one of the worst opening-day performances for an IPO for some time.

Analysts at Jefferies say:

It is hard to say with conviction at this point what Delivery Hero’s intention is with respect to its 5% holding in Deliveroo. Each company hosts a trading update in the coming days that will shed more light.

Delivery Hero are another of a string of online food delivery platforms whose businesses have boomed in the pandemic -- although the easing of lockdown restrictions may hit the sector in future.

Reuters has more details:

Founded in 2011, Delivery Hero operates in about 50 countries worldwide, with particular strength in Asia, where it owns the foodpanda brand.

It does not operate in Britain - Deliveroo’s largest market - after selling its Hungryhouse business to Just Eat in 2016.

However, after later consolidation in Germany, it does own a 7.4% stake in Just Eat Takeaway.com.

It also owns a 37% stake in Spain’s Glovo, which is considering its own listing in about three years.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

The takeover battle for Vectura, the UK inhaler company, between a private equity company and a cigarette maker has escalated after Philip Morris hiked its offer for the company.

PMI, the owner of Marlboro cigarettes, has lifted its bid for Vectura to just over £1bn, just a couple of days after its previous bid was trumped by Carlyle, the US private equity group.

Carlyle’s bid had been accepted by Vectura’s board... following criticism from medical experts alarmed about the prospect of a major tobacco company owning a firm which makes medicines and devices to help with breathing problems.

PMI insists that it is committed to a long term transformation of its business to go ‘beyond Nicotine’, rather than being focused on “short term gains and efficiency” (a pop at the much-criticised private equity model).

Its plan to run Vectura as an autonomous business unit that will form the backbone of PMI’s inhaled therapeutics business:

PMI intends to increase the total level of expenditure on research and development that it believes will further benefit Vectura’s differentiated technologies and development expertise for the delivery of complex inhaled therapeutics....

PMI believes that its significant expertise in scientific research, regulatory science, manufacturing, supply chain and commercialization globally (with operations in over 180 markets), will safeguard and enhance the development of Vectura and its capabilities in complex inhaled therapeutics.

Philip Morris’s bid is worth 165p per share, beating the 155p per share offer from Carlyle (worth around £958m), which Vectura accepted on Friday afternoon (ditching its support for an earlier offer from PMI).

But doctors, health charities and politicians have all recently sounded the alarm about PMI owning a company whose medicines treat smoking-related diseases.

As we wrote on Friday:

Anti-smoking campaigners and politicians had criticised Vectura for proposing to sell up to a tobacco company. The chief executives of Cancer Research UK, Asthma UK, the British Lung Foundation and Action on Smoking and Health wrote to the business secretary, Kwasi Kwarteng, and the health secretary, Sajid Javid, calling on the government to block the deal.

The charities said there was a “real prospect” that PMI would use Vectura to “legitimise tobacco industry participation in health debates within the UK”

The takeover of Morrisons rumbles on too, with the Takeover Panel announcing this morning that private equity firm Clayton, Dubilier & Rice has been given until August 20 to bid for the supermarket chain, or walk away.

They had been facing a 5pm deadline today, before rival bidder Fortress lifted its bid on Friday.

The agenda

• 9am BST: Sentix survey of eurozone investor morale
• 3pm BST: US Jolts survey of job openings
• 4pm BST: US consumer inflation expectations for July