Thomas Cook, the UK tour operator, lost nearly a fifth of its market value after it confirmed it was seeking a further £150m on top of the £750m already secured as part of a rescue deal with its debtholders, the Financial Times reported. The Financial Times revealed on Friday that Thomas Cook was in talks with bondholders to secure the additional capital, as part of a bailout involving its largest shareholder, the Chinese conglomerate Fosun, and its lending banks.

The British economy shrank in the second quarter for the first time in almost seven years as stockpiling activity slowed and Brexit uncertainty intensified against a backdrop of weaker global growth, the Financial Times reported. Output fell 0.2 per cent in the three months to June, worse than the flat performance expected by economists and down from a 0.5 per cent expansion in the first quarter, according to data from the Office for National Statistics released on Friday.

Industrial production in France fell sharply in June, undermining hopes that the eurozone’s manufacturing sector might have seen the worst of this year’s slowdown, the Financial Times reported. Industrial production dropped by 2.3 per cent month-on-month according to French statistical body Insee. Manufacturing, the largest component of industrial output, fell 2.2 per cent in June from the previous month, and was down 0.3 per cent in the second quarter compared to the first, driven largely by a marked drop in the making of transport equipment.

A fresh bout of political instability in Italy is testing investors’ faith in a bond rally that has sent Rome’s borrowing costs tumbling this year, but bondholders are reluctant to head for the exit. Italian debt came under pressure on Friday after the far-right League tabled a vote of no confidence in Prime Minister Giuseppe Conte, as party leader Matteo Salvini pulled the plug on Italy’s governing coalition, the Financial Times reported. The 10-year Italian bond yield rose by 0.23 percentage points to 1.76 per cent, extending the previous day’s rise.

Boris Johnson arrived in Downing Street last month intent on putting “rocket boosters” under the economy, the Financial Times reported. But after the dismal growth figures released on Friday, the prime minister may count himself lucky if the UK manages to avoid falling into a recession by October 31, when he insists the UK will leave the EU.

Investment banks and hedge funds are betting on the downfall of UK shopping centres, turning their attention to corporate bonds issued by one of the country’s largest retail landlords, the Financial Times reported. Bricks-and-mortar retailing in the UK is in crisis because of higher costs and consumers moving purchases online — trends that have forced a series of big retailers to enter insolvency arrangements, shutting thousands of stores.

Tata Steel’s UK division sank deeper into the red over the past financial year, as output fell at the country’s largest producer because of repair work on a furnace. The manufacturer registered a 1 per cent increase in annual sales to £2.41bn in the period ended 31 March because of higher global steel prices, according to its annual report, the Financial Times reported. But its operating loss before one-off items widened to £157m, from £48m last year, because of lower liquid steel production and sales volumes, the company said.

Investors have flocked to fixed income mutual funds at the fastest rate since the financial crisis, piling in almost $500bn in the first half of 2019 during trade war tensions, recessionary fears and market volatility, the Financial Times reported. About $487bn flowed into fixed income funds this year, up from $148bn in the first half of 2018, according to figures from Morningstar, the data provider. It is the highest level of first-half net inflows into bond mutual funds for at least a decade.

Burford Capital, a London-listed fund that finances lawsuits in return for a cut of any payouts, said it is considering buying back shares, a day after short-seller Muddy Waters criticised its accounts and said it had bet on its shares falling, Reuters reported. “The board is ... considering the company buying back its own shares, given the potential investment return the shares represent at their current price,” it said in a statement.

The German economy is stuck in a rut. The country’s large, export-dependent manufacturing sector is reeling from the collapse in global trade while problems within domestic industry compound the overall economic malaise, the Financial Times reported. The services sector has held up, but the disconnect is not certain to last much longer — business cycle indicators already point to a mild recession. Benefits from further monetary easing will be constrained by unprofitable banks and vast savings. Fiscal space is abundant. It must finally be used.