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There has been a positive market reaction to the resignation of Liz Truss after just 44 days in office, following the fierce backlash against her economic plan and humiliating climbdown.

News that the prime minister was to make a Downing Street statement sparked a rally for sterling versus the dollar – leaving the UK currency almost a cent up on the day at one stage at almost $1.13 before settling at $1.12 in the late afternoon.

It originally rose half a cent following confirmation she was to leave office.

Truss resignation – live updates

Shares also moved upwards initially on the FTSE 100 before closing higher than opening trading while government borrowing costs fell.

The 30-year gilt yield fell back to 3.8% – continuing its recovery since the post mini-budget highs of around 5% that sparked Bank of England intervention. As the afternoon progressed the figure rose to the 3.9% of Thursday morning.

It took a series of U-turns on the tax-cutting growth plan, demanded by new Chancellor Jeremy Hunt after the sacking of Kwasi Kwarteng, for market damage to ease.

More on Liz Truss

The reaction to the departure of Ms Truss signalled a measure of relief that the architect of the Growth Plan – outlined during her campaign for the Tory leadership – was on her way out.

Nevertheless, there was also a measure of uncertainty at play for values, given the complete lack of vision on who would replace the prime minister in Number 10.

It will not be Mr Hunt, who has ruled himself out, leaving him free to continue preparations for the Halloween statement that is to set out the government’s new medium-term fiscal plan.

There will be some jitters over whether its direction is likely to change – or even be delayed to allow the new Tory leader to get their feet under the desk.

There has been no indication that the statement will be delayed as it is expected that the successor will be in place before 31 October.

Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said of the market moves: “Sterling is highly sensitive to economic policy uncertainty and even though the ship Britannia will still be left largely rudderless, with a successor still to be chosen, as far as investors are concerned, the future is marginally brighter without her in charge.

“Ten-year gilt yields eased further today, as speculation soared about her resignation, a sign of tacit approval from the bond vigilantes who punished the UK by deserting its government’s debt as worries raced up about fiscal responsibility.”

Business appealed for a more stable period ahead.

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Hunt rules out leadership challenge

Tony Danker, the director-general of the CBI, said: “The politics of recent weeks have undermined the confidence of people, businesses, markets and global investors in Britain.

“That must now come to an end if we are to avoid yet more harm to households and firms.

“Stability is key. The next prime minister will need to act to restore confidence from day one.

“They will need to deliver a credible fiscal plan for the medium term as soon as possible, and a plan for the long-term growth of our economy.”

Pantheon Macroeconomics, the economic research consultancy, said in its October UK economic chartbook: “The economy is heading for a prolonged recession … the MPC [the interest rate setting Monetary Policy Committee] will hike Bank Rate further, but will relent at about 4%.”

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Driver hits several people on French holiday island of Ile d’Oleron

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Driver hits several people on French holiday island of Ile d'Oleron

A driver has knocked down several people on the French island of Ile d’Oleron.

Two people are in intensive care following the incident and a man has been arrested, French interior minister Laurent Nunez said.

Several others were injured after the motorist struck pedestrians and cyclists, he added.

Thibault Brechkoff, the mayor of Dolus-d’Oleron, told BFMTV the suspect shouted “Allahu Akbar” (Arabic for God is Greatest) when he was detained.

Arnaud Laraize, the public prosecutor in La Rochelle, told the Sud Ouest newspaper the 35-year-old suspect “resisted arrest” and was “subdued using a stun gun”.

He said the suspect was known for minor offences such as theft, adding he was not on a list of people considered a threat to national security.

Pedestrians and cyclists were hit on a road between Dolus d’Oleron and Saint-Pierre d’Oleron, he added.

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Police were alerted, with the first calls made at around 9am, according to French media reports.

Mr Nunez said in a post on X that he was heading to the scene at the request of the French prime minister.

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Aerial images show destruction of Typhoon Kalmaegi in Philippines – with at least 66 killed

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Aerial images show destruction of Typhoon Kalmaegi in Philippines - with at least 66 killed

At least 66 people have died after Typhoon Kalmaegi struck the Philippines, as footage emerges showing the scale of destruction.

A further 26 people have been reported missing, half of them in Cebu, where floods and mudslides killed at least 49 people, the Office of Civil Defence said.

Six crew members of a military helicopter were also killed when it crashed on the island of Mindanao, where it was carrying out a humanitarian disaster response mission, according to the military.

The powerful storm, locally named Tino, made landfall early on Tuesday and lashed the country with sustained winds of 87mph and gusts of up to 121mph.

Drone footage shows wrecked homes after heavy flooding in Cebu province. Pic: Reuters
Image:
Drone footage shows wrecked homes after heavy flooding in Cebu province. Pic: Reuters

Some communities have been wiped out. Pic: AP
Image:
Some communities have been wiped out. Pic: AP

‘State of calamity’ in Cebu

Several people were trapped on their roofs by floodwaters in the coastal town of Liloan in Cebu, said Gwendolyn Pang, secretary-general of the Philippine Red Cross.

She said in the city of Mandaune, also in Cebu, floodwaters were “up to the level of heads of people”, adding that several cars were submerged in floods or floated in another community in Cebu.

Cebu, a province of more than 2.4 million people, was still recovering from a 6.9 magnitude earthquake on 30 September, which left at least 79 people dead.

A state of calamity has been declared in the province to allow authorities to disburse emergency funds more rapidly.

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Entire towns flooded in the Philippines after typhoon

Damaged vehicles after flooding in Cebu City. Pic: AP
Image:
Damaged vehicles after flooding in Cebu City. Pic: AP

Pic: Reuters
Image:
Pic: Reuters

Fierce winds either ripped off roofs or damaged around 300 mostly rural shanties on the island community of Homonhon in Eastern Samar, but there were no reported deaths or injuries, mayor Annaliza Gonzales Kwan said.

“There was no flooding at all, but just strong wind,” she said. “We’re okay. We’ll make this through. We’ve been through a lot, and bigger than this.”

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Red Cross staff rescue people and dogs. Pic: Reuters
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Red Cross staff rescue people and dogs. Pic: Reuters

Pic: AP
Image:
Pic: AP

Hnndreds of thousands evacuated

Before Kalmaegi’s landfall, officials said more than 387,000 people had been evacuated to safer ground in eastern and central Philippine provinces.

The combination of Kalmaegi and a shear line brought heavy rains and strong winds across the Visayas and nearby areas, state weather agency PAGASA said.

A shear line is the boundary between two different air masses such as warm and cold air.

Pic: AP
Image:
Pic: AP

A boy with a goldfish he caught after a nearby fish farm flooded. Pic: AP
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A boy with a goldfish he caught after a nearby fish farm flooded. Pic: AP

Vietnam gears up for storm

The Vietnamese government has said it was preparing for the worst-case scenario as it braced for the impact of Kalmaegi.

The typhoon is forecast to reach Vietnam’s coasts on Friday morning. Several areas have already suffered heavy flooding over the last week, leaving at least 40 people.

Kalmaegi hit the Philippines as it continues to recover from several disasters, including earthquakes and severe weather over recent months.

Around 20 typhoons and storms hit the Philippines each year, and the country is also often struck by earthquakes and has more than a dozen active volcanoes.

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Meet the underground squad with the lives of countless civilians in their hands

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Meet the underground squad with the lives of countless civilians in their hands

“Follow me and be careful,” says the commander, as he leads us down a narrow path in the dead of night.

The overgrown tract had once been occupied by the Russians, and there are landmines scattered on the side of the path.

But the men with us are more concerned about the threat from above.

Members of a unit in Ukraine’s 3rd Assault Brigade, they run a covert operation from an underground cellar, tucked behind a ruined farmhouse.

And what they are doing in this old vegetable store is pushing the boundaries of war.

“This is the interceptor called Sting,” says the commander, named Betsik, holding up a cylindrical device with four propellers.

“It’s an FPV [first-person view] quad, it’s very fast, it can go up to 280km. There’s 600 grams of explosive packed in the cap.”

The Sting interceptor drone used by the Ukrainians
Image:
The Sting interceptor drone used by the Ukrainians

However, he had not told us the most important thing about this bulbous drone.

“It can easily destroy a Shahed,” he says with determination.

Devastating and indiscriminate drone attacks

Once viewed as a low-cost curiosity, the Iranian-designed Shahed drone has turned into a collective menace.

As Russia’s principal long-range attack weapon, enemy forces have fired 44,228 Shaheds into Ukraine this year, with production expected to rise to 6,000 per month by early next year.

A Shahed-136 drone used by Russia amid its attack on Ukraine, on display in London. Pic: Reuters
Image:
A Shahed-136 drone used by Russia amid its attack on Ukraine, on display in London. Pic: Reuters

The Russians are also changing the way they use them, launching vast, coordinated waves at individual cities.

The damage can be devastating and indiscriminate. This year, more 460 civilians have been killed by these so-called kamikaze weapons.

Russia’s strategy is straightforward. By firing hundreds of Shaheds on a single night, they aim to overload Ukraine’s air defences.

It is something Betsik reluctantly accepts.

Betsik observes the work of the team on in the cellar
Image:
Betsik observes the work of the team on in the cellar

Still, his unit has come up with a groundbreaking way to tackle it.

Perched in the centre of the vegetable store, we watch a youthful drone pilot and a couple of navigators staring at a bank of screens.

“Guys, there’s a Shahed 10km away from us. Can we fly there?” asks one of the navigators, called Kombucha.

He had just spotted a Shahed on the radar, but the enemy projectile was just out of reach.

“Well, actually 18 km – it’s too far,” Kombucha says.

“Do you know where it is going?” I ask.

“Yes, Izyum, the city. Flying over Izyum, I hope it won’t hit the city itself.”

Kombucha takes a deep breath.

“It is driving me nuts when you can see it moving, but you can’t do anything about it.”

The chase

The atmosphere soon changes.

“Let’s go. Help me lift the antenna.”

An engineer runs an interceptor drone up to the unit’s ad-hoc launch pad, located on a pile of flattened brick.

“The bomb is armed.”

The drone pilot, called Ptaha, tightens his grip on the controller and launches the Sting into the night sky.

Now, they hunt the Shahed down.

Their radar screen gives them an idea of where to look – but not a precise location.

“Target dropped altitude.”

“How much?”

“360 metres. You’re at 700.”

Instead, they analyse images produced by the interceptor’s thermal camera. The heat from the Shahed’s engine should generate a white spec, or dot, on the horizon. Still, it is never easy to find.

“Zoom out. Zoom out,” mutters Ptaha.

Then, a navigator code-named Magic thrusts his arm at the right-hand corner of the screen.

“There, there, there, b****!”

“I see it,” replies Ptaha.

The pilot manoeuvres the interceptor behind the Russian drone and works to decrease the distance between the two.

The chase is on. We watch as he steers the interceptor into the back of Shahed.

“We hit it,” he shouts.

“Did you detonate?”

“That was a Shahed, that was a Shahed, not a Gerbera.”

Going in for the kill

The Russians have developed a family of drones based on the Shahed, including a decoy called the Gerbera, which is designed to overwhelm Ukrainian defences.

However, the 3rd Brigade tells us these Gerberas are now routinely packed with explosives.

“I can see you’ve developed a particular technique to take them all down,” I suggest to Ptaha. “You circle around and try to catch them from behind?”

“Yes, because if you fly towards it head-on, due to the fact that the speed of the Shahed…”

The pilot breaks off.

“Guys, target 204 here.”

It’s clear that a major Russian bombardment is under way.

“About five to six km,” shouts Magic.

With another target to chase, the unit fires an interceptor into the sky.

Ptaha stares at the interceptor’s thermal camera screen.

The lives of countless Ukrainians depend on this 21-year-old.

“There, I see it. I see it. I see it.”

The team pursues their target before Ptaha goes in for the kill.

“There’s going to be a boom!” says Magic excitedly.

“Closing in.”

On the monitor, the live feed from the drone is replaced by a sea of fuzzy grey.

“Hit confirmed.”

“Motherf*****!”

‘In a few months it will be possible to destroy most of them’

The Russians would launch more than 500 drones that night.

Betsik and his men destroyed five with their Sting interceptors and the commander seemed thrilled with the result.

“I’d rate it five out of five. Nice. Five launches, five targets destroyed. One hundred percent efficiency. I like that.”

Maxim Zaychenko
Image:
Maxim Zaychenko

Nevertheless, 71 long-range projectiles managed to slip through Ukraine’s air defences, despite efforts made to stop them.

The head of the air defence section in 3rd Brigade, Maxim Zaychenko, told us lessons were being learnt in this underground cellar that would have to be shared with the entire Ukrainian army.

“As the number of Shaheds has increased we’ve set ourselves the task of forming combat crews and acquiring the capabilities to intercept them… it’s a question of scaling combat crews with the right personnel and equipment along the whole contact line.”

Betsik speaks to Sky News
Image:
Betsik speaks to Sky News

Buoyed by the night’s successes, Betsik was optimistic.

“In a few months, like three to five, it will be possible to destroy most of them,” he said.

“You really think that?” I replied.

“This is the future, I am not dreaming about it, I know it will be.”

Photography by Katy Scholes.

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