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The boss of Gunvor, one of the world’s biggest oil traders, has awarded himself a bumper $1bn dividend to sever his ties to a former business partner who is the subject of US sanctions. Torbjörn Törnqvist, chief executive, used the $1bn dividend to settle a debt owed to Russian oligarch Gennady Timchenko.

Mr Timchenko, who co-founded Gunvor, is on a US sanctions list because of links to Russian president Vladimir Putin. The sanctions were imposed after Russia’s annexation of Crimea.

The $1bn dividend comes after Gunvor reported net income of $1.25bn for 2015 — a record amount. Like other oil traders, the trader has made money amid volatile oil prices, for example by buying crude cheaply and agreeing to sell it on later at higher prices. Its 2015 profit was significantly boosted by the sale of a majority stake in a Russian oil terminal. But the amount is likely to raise eyebrows in the close-knit oil trading community. (FT)

In the news

Brazil anti-corruption minister resigns Michel Temer’s government, in office less than three weeks, is being rocked by leaked recordings that appear to show newly appointed cabinet members working to subvert a probe into government graft. The latest casualty is Fabiano Silveira, whose job as transparency minister is intended to fight corruption. He resigned after a recording aired on national television showed him apparently advising Senate President Renan Calheiros on how to dodge investigators. (WSJ)

France braced for more labour unrest François Hollande has insisted a controversial labour reform will go ahead as strike action spreads to the railways. “The text assures the best performance for businesses and offers new rights to employees,” the French president told a newspaper. Protesters clashed with police last week during marches against the bill, which makes hiring and firing easier and which was pushed through the lower house of parliament without a vote. There are concerns the Euro 2016 football championships, which France hosts next week, may be disrupted. (BBC)

Web giants sign up to EU hate speech rules Google, Facebook, Twitter and Microsoft have signed up to new EU rules on taking down illegal hate speech as lawmakers and internet giants try to cope with violent racist abuse and technically savvy terrorists online. The “code of conduct” will require companies to “review the majority” of flagged hate speech within 24 hours — and remove it, if necessary — and even develop “counter narratives” to combat the growing problem. (FT)

Ground offensive to retake Fallujah begins Iraqi forces pushed into Isis-held Fallujah on Monday, hoping to claim their biggest victory to date against the militants but also facing their sternest test. In the past week, the Iraqi army, along with special forces and Shia militias, has been encircling the city, preparing to attack a stronghold that represented Isis’s first big conquest in Iraq in January 2014. (FT)

Obama criticised over migrants President Obama has spoken passionately about embracing refugees as a core American value. But nearly eight months into an effort to resettle 10,000 Syrian refugees in the US, his administration has admitted just over 2,500. As it prepares for a new round of deportations of Central Americans, the president is facing intense criticism from allies in Congress and advocacy groups about his administration’s treatment of migrants. (NYT)

Gulliver tops investor hit list HSBC’s Stuart Gulliver is the European bank chief executive who investors would most like to be replaced, according to a recent poll of large shareholders. (FT)

Europe defence spending to rise Europe’s Nato states are set to increase their military spending for the first time in nearly a decade as fears over Russian aggression and the migrant crisis in the Mediterranean stoke anxiety. The alliance’s parliamentary assembly has urged members to be ready to respond to the “potential threat” from Moscow. “The challenge from Russia is real and serious,” said Michael Turner, the US president of the assembly, which gathered about 250 lawmakers from the 28 member states. (FT, Yahoo)

It's a big day for

Chinese stocks, which carved out their biggest gain in two months amid speculation that A-shares could be included in MSCI’s global benchmarks. Today, Goldman Sachs upgraded the odds of A-shares being included in the MSCI indices to 70 per cent, from the 50 per cent chance it had given it on April 25. The decision is due on June 15. (FastFT)

Volkswagen The carmaker’s first-quarter results were far higher than expected despite weaker than forecast operating margins in its core passenger brand. The postponed results showed operating profit in the quarter was €3.4bn, up from €3.3bn a year earlier and well above forecasts for €2.8bn. (FastFT)

Food for thought

Obama ratings are good news for Clinton Hillary Clinton and Donald Trump are running neck-and-neck in the polls, but Mrs Clinton’s chances look much stronger based another set of numbers: President Barack Obama’s approval ratings. A president’s popularity, combined with strong economic data, have proven better predictors than horse-race polls this far ahead of the general election. (Bloomberg)

Xi has changed China’s winning formula Politics in the west are so dramatic at the moment that China can look relatively staid and stable by comparison. But that impression is deceptive. Xi Jinping is taking his country in radical and risky new directions, writes Gideon Rachman. (FT)

Credit quality of some P2P loans triggers concerns “Interest rates at record lows. Investors desperate for decent returns. A whizzy new way to make money by securitising risky consumer debt. Crash.” The story of the US subprime mortgage craze of a decade ago and the disaster that followed, “could equally be a doomsday extrapolation of the distress evident today among US peer-to-peer ‘marketplace’ lenders, says Patrick Jenkins.(FT)

Nigeria: Running on empty Should the fall be this hard? The question is nagging at a growing section of the Nigerian public, angered that President Muhammadu Buhari — elected on a wave of optimism just last year — has not only failed to react fast enough to the changing economic climate but made matters worse. “The pain level is going up.” (FT)

Our man in New Delhi signs off The FT’s departing South Asia bureau chief Victor Mallet looks back on the things he has loved — and hated — during his four years in India. (FT)

Perils of taking on Russia’s internet trolls Seeking to shine some light into the dark world of internet trolls, a journalist with Finland’s national broadcaster asked members of her audience to share their experience of encounters with Russia’s “troll army,” a raucous and often venomous force of online agitators. The response was overwhelming, though not in the direction that the journalist, Jessikka Aro, had hoped. (NYT)

Why some cultures frown on smiling In some countries, smiling might not be taken as a sign of warmth or respect — but rather evidence of a lack of intelligence. The issue relates to a phenomenon called “uncertainty avoidance”; these countries were typically institutionally unstable and therefore viewed smiling — and its implicit contentment — as an absurdity. (The Atlantic)

Video of the day

China, Japan and Oil Katie Martin highlights what’s hot in the markets including Chinese stocks jumping by more than 3 per cent, robust domestic data from Japan and the upcoming Opec meeting (FT)

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