Texas governor orders arrest of Democrats

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Texas governor Greg Abbott has ordered the arrest of Democratic lawmakers who temporarily left the state to prevent a vote on redrawing congressional districts that would bolster the Republican party’s majority in the US House of Representatives. Here’s what you need to know.

Why has Abbott ordered the arrests? A vote in the Texas state legislature had been scheduled for yesterday to redraw the state’s congressional map ahead of the 2026 midterm elections. In order for the Texas House to vote on the measure, at least 100 of 150 members needed to be present. Democrats are denying Republicans, who control the state government, a quorum by absenting themselves en masse. At least 51 of the 62 members of the Democrat caucus have broken the quorum. “This is not a decision we make lightly, but it is one we make with absolute moral clarity,” caucus chair Gene Wu said in a statement.

Why it matters: Donald Trump has pushed for these changes ahead of next year’s midterm elections. Republicans hold the US House by a slim 219-212 majority and the president has said he would like to see electoral boundaries redrawn in various states before his party defends its control of Congress in the midterms. “There could be some other states we’re going to get another three, or four or five in addition. Texas would be the biggest one,” Trump said earlier this month. “Just a simple redrawing, we pick up five seats.” Read more on the proposed changes.

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

• Economic data: The Institute for Supply Management publishes its non-manufacturing PMI for July. The Commerce Department’s Bureau of Economic Analysis reports international trade figures and the Federal Reserve Bank of New York issues its second quarter household borrowing and indebtedness report. The UN publishes its updated economic growth forecasts for Latin America and the Caribbean.

• Results: Pfizer, Amgen, Yum Brands, Molson Coors, Rivian, Lucid, Snap and Advanced Micro Devices publish second-quarter results. News Corp releases annual earnings. See our Week Ahead newsletter for the full list.

• Ghislaine Maxwell: Jeffrey Epstein’s former girlfriend, a lawyer for the deceased sex offender and the alleged victims in their sex trafficking cases face a deadline to tell a US judge their position on the justice department’s bid to unseal the grand jury records in her case.

Five more top stories

1. Exclusive: Deutsche Bank’s chief executive Christian Sewing signed off a €1.5bn deal that was later scrutinised as part of a probe he oversaw that led to the conviction of former colleagues, according to documents seen by the Financial Times. Read the full report.

2. Brazil’s supreme court last night ordered the house arrest of former president Jair Bolsonaro, in open defiance of Donald Trump as the US leader’s ally stands trial on charges of a coup plot. The country’s top tribunal issued the ruling on the grounds that Bolsonaro, who was already subject to a curfew, had breached a social media ban imposed by the court last month. Michael Pooler in São Paulo reports.

3. Investor enthusiasm for Argentine President Javier Milei has yet to translate into cheap dollar financing for the cash-strapped country. Argentina is still locked out of foreign currency issuance on global markets and without that access, the country’s economic growth will be stunted and it will be unable to pay back the $57bn it owes to the IMF. “Milei needs fluid access to markets to make his programme sustainable,” said one Buenos Aires-based economist.

4. Drugmaker Sandoz could offer unbranded weight-loss drugs at an up to 70 per cent discount to the branded versions in Canada when patents start to expire there next year. Sandoz chief executive said the company had not finalised the price for its generic weight-loss and diabetes drug semaglutide but that a reduction of “60 or 70 per cent of the list price” was possible.

5. Visa is nearing a deal to move its European headquarters from London’s Paddington to Canary Wharf, in a sign of strength for the Docklands’ financial district amid a string of company departures. The payments group is in talks to take over the space being vacated by Moody’s at One Canada Square, according to people familiar with the matter. 

The Big Read

An FT investigation has found that an Iranian delegation last year visited Russian scientific institutes that produce dual-use technologies — components with civilian applications but which, experts say, have potential relevance to nuclear weapons research. The trip to Russia took place at a time when western governments were noticing a pattern of suspicious activity carried out by Iranian scientists. Read the full investigation.

We’re also reading . . . 

• Federal Reserve: The US central bank should reconsider its dual mandate and reorient monetary policy towards maximising productivity, argues Wellington Management’s Brij Khurana.

• Defence tech: Anduril and Palantir are among the most prominent tech companies set to profit from Trump’s flagship tax and spending legislation. Joe Miller and Tabby Kinder investigate the connections between the administration and the companies.

• Dynamic wages: Food-delivery companies’ new pay models use algorithms to decide bespoke fees, but the practice leaves gig workers in the dark, writes Sarah O’Connor.

• Jason Furman: The Harvard professor and former chair of the White House Council of Economic Advisers says America’s consumers and businesses will suffer from Trump’s tariffs.

Chart of the day

Weak business investment is threatening global growth, the OECD has warned, with corporate spending in most advanced economies failing to return to historic trends after the financial crisis and pandemic. Only two advanced economies out of 34 the OECD tracked had surpassed their pre-financial crisis net investment trends as of last year. Find out more.

Take a break from the news . . . 

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