Thanks for joining me. The pound dropped after Andy Burnham launched his campaign to return to Westminster and become the new prime minister.

Sterling has declined by 0.8pc against the dollar since the Mayor of Greater Manchester announced his intention to run in a by-election for the Makerfield seat on Thursday.

The pound fell to a one-month low of $1.335, having been above $1.36 on Tuesday, as Mr Burnham took the first steps on his path towards a leadership contest to replace Sir Keir Starmer.

His gambit came just hours after Wes Streeting resigned as health secretary decrying the “vacuum” and lack of “vision” of Sir Keir’s leadership and demanding the Prime Minister set a timetable for his departure.

The leadership turmoil has left the pound on track for its worst week since the aftermath of Rachel Reeves’s first budget in November 2024, declining by 1.9pc so far.

Investors will wait to see what happens to the cost of government borrowing now the Mayor of Greater Manchester has entered the leadership fray.

Mr Burnham announced he would seek to replace Josh Simons, the scandal-hit Labour MP who is resigning, after the bond market had closed on Thursday.

He triggered a spike in government borrowing costs last year when he said Britain was too “in hock” to the bond markets, raising concerns he would loosen the public purse strings to fund his plan for the country. Here is what you need to know.

5 things to start your day

1) China threatens UK over British Steel nationalisation | Beijing warns Starmer to ‘act cautiously’ in decisions over state ownership of Scunthorpe plant

2) JCB’s Lord Bamford: You can’t get away with £60k benefit handouts | Billionaire sounds alarm on welfare spending and warns Labour against a lurch to the Left

3) Currys’ turnaround king tasked with reviving tired Boots ahead of flotation | New chief executive aims to convince investors of health and beauty retailer’s £7bn worth

4) Overworked AI ‘turns towards Marxism’ | Bots that carried out ‘unfair’ tasks were more likely to express Left-wing opinions

5) Benefit cheats fuel £10bn in welfare overpayments | Claimants’ fraudulent practices include understating their wealth and filing misleading earnings

What happened overnight

Asian stocks fell as investors watch for developments from the Iran war and Donald Trump’s summit in Beijing with Chinese leader Xi Jinping.

Tokyo’s Nikkei 225 fell 1.2pc to 61,880.04 after rising earlier in the day. South Korea’s Kospi lost 3.2pc to 7,727.34 after crossing the 8,000 mark for the first time and reaching 8,046.78, in part powered by excitement around the artificial intelligence boom.

Hong Kong’s Hang Seng was down 0.9pc to 26,145.66, while the Shanghai Composite index edged up 0.1pc to 4,183.05.

Australia’s S&P/ASX 200 dipped 0.1pc to 8,629.70.

Taiwan’s Taiex traded 0.5pc lower, and India’s Sensex was up 0.1pc.

Mr Trump is wrapping up his China visit on Friday after a series of meetings with Xi that touched on issues including US-China trade, further economic cooperation and Taiwan.

Brent crude oil jumped above $107 a barrel after the US president said the US doesn’t need the Strait of Hormuz open “at all”.

US stocks hit new highs, with the S&P 500 jumping 0.77pc to an all-time record 7,501. The tech-heavy Nasdaq Composite also climbed by 0.88pc to hit a record 26,635. The indexes are up 9.37pc and 14.63pc so far this year respectively.

Chip-maker Nvidia was one big performer, rising by 4.39pc on Thursday. It has climbed by more than 10pc in the last five days alone and now has a market cap of $5.7tn.

The pound slumped after Labour MP Josh Simons said he would resign to allow Manchester Mayor Andy Burnham to run for Parliament and challenge Prime Minister Keir Starmer for the Labour leadership.

Sterling dropped 0.5pc to $1.34 against the dollar. Earlier in the day, before Mr Simons’ announcement, it was at $1.35.