Honduras election on a knife-edge

Good morning and welcome back. In today’s newsletter:

• Virtual tie in the Honduras election

• Steve Cohen’s plan for New York’s first casino moves closer

• China’s booming pharma industry

• And a new guide to the best art in Washington DC

We start in Honduras where early results in the presidential election show a virtual tie with just over 500 votes separating a conservative former mayor backed by Donald Trump and an ex-television host making his fourth run for the presidency. Here’s what you need to know.

The latest: With 57 per cent of the ballots counted, the conservative National party’s Nasry “Tito” Asfura, the former mayor of the capital Tegucigalpa, has 39.91 per cent of the vote to 39.89 per cent for the Liberal party’s Salvador Nasralla, a former sportscaster. Nasralla whittled down Asfura’s lead to just 515 votes, according to the latest official data from the National Electoral Council. Rixi Moncada, from the ruling leftist Libre party, was well behind with 19 per cent of the vote.

Why it matters: Trump last week threw his weight squarely behind Asfura, saying “democracy is on trial” in a country of strategic importance to the US. Trump’s comments turned up the heat on an election that had already become a tinderbox in a nation that underwent a military coup in 2009 and whose previous president was serving a 45-year jail term in the US for cocaine trafficking. But in a surprising development on Friday, Trump announced he would pardon Juan Orlando Hernández, the former president, saying he had been “set up” by former US president Joe Biden. Read the full story.

Here’s what else we’re keeping tabs on today:

• Ukraine war: President Donald Trump’s special envoy, Steve Witkoff, and son-in-law Jared Kushner will meet Russian President Vladimir Putin at the Kremlin to discuss a peace plan for Ukraine.

• Federal Reserve: Vice-chair for supervision Michelle Bowman testifies before the House Financial Services Committee hearing on oversight of financial regulators, in Washington.

• Companies: Apparel retailer American Eagle Outfitters is expected to post a rise in its third-quarter revenue.

• Economic data: Brazil’s IPC-Fipe inflation index for November is set for release. Separately, the Brazilian Institute of Geography and Statistics is expected to report industrial output for October.

Join senior FT editors tomorrow for a discussion on what will shape the year ahead. Register for free today.

Five more top stories

1. Exclusive: The European Central Bank has refused to backstop a €140bn payment to Ukraine, dealing a blow to an EU plan to raise a “reparations loan” backed by frozen Russian assets. It comes amid pressure on the EU to finance Ukraine for the next two years, as Kyiv faces a cash crunch and Russia makes military gains on the battlefield.

2. Hedge fund manager Steve Cohen has won approval from a critical regulatory board to build a casino in New York. The decision to proceed with the project, called Metropolitan Park, paves the way for the billionaire to potentially run one of the city’s first gambling facilities. Here’s more on the Queens project.

3. Shares of Strategy slipped after the bitcoin champion launched a US dollar reserve to fund its dividends and warned that it could incur a $5.5bn loss if the price of the cryptocurrency does not rebound this year. Bitcoin evangelist Michael Saylor has transformed Strategy from a small software company into the world’s biggest corporate holder of the cryptocurrency.

4. Apple’s vice-president of artificial intelligence will be replaced by a top Microsoft executive as the iPhone maker struggles to recover from a slow start in the race to harness advanced AI. John Giannandrea, senior vice-president for machine learning and AI strategy, will step down and will be replaced by former Microsoft executive Amar Subramanya, who previously worked at Google, where he was involved with developing the Gemini chatbot.

• More AI news: OpenAI chief executive Sam Altman has declared a “code red” over the need to improve ChatGPT, according to a memo sent to staff yesterday.

5. Blackstone, Apollo and KKR have agreed to participate in a Bank of England stress test of how the fast-growing private credit market would fare in a major crisis, according to people briefed on the matter. The BoE is expected to announce this week that it is pressing ahead with the groundbreaking assessment.

Today’s Big Read

China’s biopharmaceutical companies are developing drugs faster and more cheaply than foreign competitors thanks to a surge in investment and improved supply chains. But can the country’s industry match rivals like AstraZeneca and Pfizer?

We’re also reading . . . 

• The strongman race: Chinese leader Xi Jinping is ending the year in a better position than his American and Russian counterparts, writes Gideon Rachman.

• Chile: Arch-conservative José Antonio Kast has a commanding poll lead ahead of the final round of voting in the December 14 presidential election. He spoke to the FT.

• Remaking divorce law: A group of women in London has become the best known, most successful family lawyers of their generation.

• Tech start-ups: A new ritual has taken hold in Silicon Valley and it is replacing the pitch deck for entrepreneurs hoping to raise finance, writes Amber Atherton, partner at early-stage venture firm Patron.

Chart of the day

As official US data releases are published again following the shutdown hiatus, our colleagues over on the Unhedged newsletter took a moment to check in on the health of the US consumer. They analysed last week’s September retail sales report, the latest results from retail giants such as Walmart and Home Depot and some early Black Friday data. Here’s what they found.

The FT’s Financial Literacy and Inclusion Campaign gives people the financial skills that lead to better choices at a time when many households are under real pressure. Please consider supporting the FT’s seasonal appeal at ft.com/donate

Take a break from the news . . . 

Ariella Budick writes about US art for the FT. She has shared her top-10 favourite works in Washington DC, part of FT Globetrotter’s new guide to the capital.