Far right bursts Starmer’s bubble

Tacking far-right violence is suddenly the most pressing problem for Keir Starmer. [View in browser]( [Bloomberg]( Welcome to Balance of Power, bringing you the latest in global politics. If you haven’t yet, sign up [here](. Aside from the Labour Party’s thumping victory, the outcome of the UK’s July election was a more fragmented politics that the country’s first-post-the-post voting system had for so long hindered. As a result, strategists at No. 10 Downing Street have already been talking privately about how they should ready themselves to face a consolidated far-right foe at the next election. It took only a month for that to become [the most pressing challenge]( in Keir Starmer’s intray. After almost a week of rioting across England reached an ugly crescendo yesterday with attacks on two hotels serving as temporary accommodation for asylum seekers, the prime minister [called an emergency security meeting]( to try to get a grip on the disorder. The man who ran and won on an ostentatiously boring “governance” platform will now be judged on his ability to do precisely that. The timing couldn’t be more awkward: Starmer’s chancellor, Rachel Reeves, is in New York to sell the message to financiers that the UK is now “open for business.” In that context, the outburst of what Starmer called “organized, violent thuggery” is not a helpful look. WATCH: Starmer called an emergency security meeting following violent anti-immigrant protests across the country. Rosalind Mathieson reports. Source: Bloomberg TV Starmer was Director of Public Prosecutions in 2011, the last time the UK experienced anything like this. That may be why he’s rushed to respond with emergency court sittings, asking prosecutors to work round the clock to process cases, and pledging that offenders will regret their actions. The question is whether, this time, a legalistic approach will be enough. The Conservatives spent years trying by turns to ignore and outdo the populist right and their hostility to migrants, but it’s clear their election defeat hasn’t done enough to turn a page. The outpouring of anti-immigration sentiment amid the racism again underlines how the Brexit referendum — far from neutering that tendency in British politics — instead elevated it to its most salient issue. That’s Starmer’s problem now.— [Isobel Finkel]( A chair is thrown at riot police in Rotherham yesterday. Photographer: Danny Lawson/PA Please note: Our email domain is changing, which means you’ll be receiving this newsletter from noreply@news.bloomberg.com. Update your contacts to ensure you continue receiving it — check out the bottom of this email for more details. Global Must Reads Iran signaled it wants to avoid all-out war with Israel, even as it [threatened to retaliate]( for last week’s assassination of a leading Hamas figure in its capital. A spokesperson for Iran’s foreign ministry said Tehran has the right under international law to punish Israel but does not want to [escalate tensions]( in the Middle East. Israel has neither confirmed nor denied being responsible for [the killing]( of Ismail Haniyeh. President Volodymyr Zelenskiy showcased two F-16 warplanes flying near Kyiv, hailing [a new era]( for Ukraine’s military with proof that the long-awaited fighter jets had finally arrived. Ukrainian forces said they struck a military airfield as part of a [massed drone attack]( on several Russian regions, while claiming they had sunk a Black Sea Fleet submarine in Crimea. In one of its biggest displays of rocket prowess under leader Kim Jong Un, North Korea said it deployed 250 new mobile launchers for ballistic missiles that can [deliver nuclear strikes]( on South Korea and US bases there. Seoul [has warned]( that Pyongyang may be considering timing its first nuclear test since 2017 close to November’s US presidential election. After claiming victory in Venezuela’s presidential election, Nicolas Maduro has faced down international condemnation and ratcheted up his anger at the opposition like never before, arresting more than 2,000 protesters and promising to send them to maximum-security prisons for 30 years — the same sentence handed down to murderers. [As this piece from Caracas shows]( taking repression to unprecedented extremes puts both Venezuela’s people and its economic recovery at risk. Maduro during a news conference at Miraflores Palace in Caracas last week. Photographer: Gaby Oraa/Bloomberg Bangladesh Prime Minister Sheikh Hasina left the country with her sister as anti-government protesters converged on the capital, according to the Prothom Alo newspaper. Hasina has [faced pressure to resign]( for weeks following demonstrations that turned deadly; Army Chief Waker-Uz-Zaman said he will meet with the president on forming an interim government. Australia raised its terrorism threat level for the first time since 2014 as [fears grow]( inside the intelligence community about online radicalization and public anger over the Israel-Hamas war. Nigerian President Bola Tinubu said demonstrations last week against the high cost of living that led to the deaths of at least 21 people are politically motivated and meant to [undermine his government](. Cyprus’ president accepted an invitation to a United Nations-brokered meeting that will attempt to [restart talks]( on unification of the divided island, although it’s unclear if Turkish Cypriot leader Ersin Tatar will agree to attend. Washington Dispatch Kamala Harris is expected imminently to announce who will join her on the 2024 Democratic Party presidential ticket. Sources say [she met yesterday]( with at least three possible running mates: Arizona Senator Mark Kelly, Pennsylvania Governor Josh Shapiro and Minnesota Governor Tim Walz. Mark Kelly, Josh Shapiro and Tim Walz. Photographers: Al Drago, Hannah Beier, Eva Marie Uzcategui/Bloomberg The vice president’s entry has overhauled the dynamics of the race. She quickly [raised more than $300 million]( and has [erased some of the lead]( that former President Donald Trump held in national polls. Her pick could determine whether that momentum continues to propel her or fades as election day approaches. Kentucky Governor Andy Beshear, Transportation Secretary Pete Buttigieg and Illinois Governor JB Pritzker are among the other names floated to join her on the ticket. Harris plans to kick off a tour of seven battleground states next week, with her running mate slated to join her tomorrow in Philadelphia. One thing to watch today: The ISM Services Index is expected to show that activity in the sector remained in contractionary territory in July. [Sign up for the Washington Edition newsletter]( for more from the US capital and watch Balance of Power at 1 and 5 p.m. ET weekdays on Bloomberg Television. Chart of the Day The global stock-market rout accelerated, with [losses cascading]( across tech shares, Nasdaq 100 Index futures falling 3% and [Japanese equities crashing]( by the most in over a decade. As concerns about a US economic slowdown intensified, traders ramped up bets that the Federal Reserve will step in with an emergency interest rate cut, putting the odds at 60% for a quarter-point reduction within one week. Nasdaq 100 futures tumbled as much as 6.5%, coming close to triggering a circuit breaker. And Finally Climate protesters are [taking the fight to Wall Street bankers]( with demonstrators outside Citigroup’s headquarters in New York holding up signs that read “Hot People Hate Wall Street” and calling for banks to divest from fossil fuels. Why ­Citigroup? Organizers of the Summer of Heat movement point to a report that ranks it among the top financiers of the fuels on Wall Street, but the bank has questioned the report’s figures and says it wants to work with carbon energy companies while funding a shift to a cleaner economy. Demonstrators in front of Citigroup’s New York headquarters last month. Photographer: Mark Peterson for Bloomberg Markets Thanks to the 21 people who answered the Friday quiz and congratulations to Karol Bojnanský, who was the first to name South Korea as the country where authorities arrested an official over allegations of leaking intelligence that included a list of secret agents posted abroad. More from Bloomberg - [Economics Daily]( for what the changing landscape means for policy makers, investors and you - [Green Daily]( for the latest in climate news, zero-emission tech and green finance - Check out our [Bloomberg Investigates]( film series about untold stories and unraveled mysteries - [Bloomberg Opinion]( for a roundup of our most vital opinions on business, politics, economics, tech and more - [Next Africa]( a twice-weekly newsletter on where the continent stands now — and where it’s headed - Explore more newsletters at [Bloomberg.com](. 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