Madeline Halpert
Reporting from court

We're touching on yet another chapter in the scandal.

Daniels testifies that she later hired a new lawyer, Michael Avenatti, to get her out of the non-disclosure agreement.

She says she did this “so that I could stand up for myself".

Daniels testifies that she was later freed from the agreement after Michael Cohen agreed not to enforce it.

Her lawyer, Avenatti, later went to prison for defrauding Daniels.

Meanwhile, things seem to be going better for prosecutors this afternoon after giving some instruction to Daniels.

Prosecutors are asking more yes or no questions, and Daniels is giving shorter answers.

Image source, Reuters

Madeline Halpert
Reporting from court

Like this morning, Trump is not showing much of a reaction to the testimony from Daniels.

He's sitting still in his chair, appearing to look straight ahead.

His son is seated just two rows behind him, listening to intricate details about his father's alleged sexual encounter with Daniels.

Like his father, Eric Trump has a similar demeanour, a stern and non-reactive expression.

Madeline Halpert
Reporting from court

Image source, Reuters/ Jane Rosenberg

Daniels says she continued to abide by the hush-money agreement, not speaking about the alleged sexual encounter for years.

But in 2018, she was approached by the Wall Street Journal about a story on the agreement, she says.

We learned in earlier testimony that she signed a statement to the outlet denying anything happened between her and Donald Trump. She says she did not want to sign the statement because it felt untrue - and because her hush-money agreement mandated she not comment at all.

After the Wall Street Journal article was published, Daniels says she and her family were "ostracized" from many social settings.

Madeline Halpert
Reporting from court

Daniels says she ended up with about $96,000 after her lawyer, Davidson, and manager, Gina Rodriguez, took their fees from the hush-money payment of $130,000 from Michael Cohen.

Madeline Halpert
Reporting from court

We start back where we left off - discussing the fact that the hush-money payment to Daniels was late.

We’re seeing an email her lawyer, Keith Davidson, sent to Michael Cohen saying the hush-money deal was cancelled because she hadn’t received the money.

During this time, Daniels says that she spoke to the news outlet Slate about her story.

As a result, a new agreement was drafted that Daniels also signed, she says.

Madeline Halpert
Reporting from court

After that back and forth, prosecutor Susan Hoffinger has stepped outside to talk to Daniels and to tell her to stick to the questions and not give any "unnecessary narrative", Justice Merchan tells the court.

Daniels has just walked back into the room and now takes her seat at the stand.

Madeline Halpert
Reporting from court

Image source, Reuters/Jane Rosenberg

Justice Merchan says a mistrial is not warranted.

But he agrees with Trump's lawyers that "there were some things that would probably have been better left unsaid" when Stormy Daniels testified this morning.

He says Daniels has been a difficult witness for prosecutors to control, and he notes that he's been sustaining objections from Trump's lawyers.

Madeline Halpert
Reporting from court

Prosecutors are up arguing their case now.

They say Justice Merchan did not put any guardrails on her testimony.

Susan Hoffinger notes that a lot of the details Daniels is sharing are not new.

She adds that they have been "extremely mindful" in eliciting her testimony, and says the defence can raise any issues they have during cross-examination.

Madeline Halpert
Reporting from court

Trump's lawyers have tried to argue for mistrials before, and did so in his civil business fraud trial.We'll find out in a bit what Justice Merchan decides.

But he has already shown frustration today, with the prosecutor's questioning of Daniels this morning. He sustained several objections from Trump's legal team, and reminded Daniels to stick to the questions and keep her answers brief.

Madeline Halpert
Reporting from court

Todd Blanche, Trump's lawyer, is arguing for a mistrial.

He says the court set "guardrails" for Daniels' testimony, and that those guardrails were thrown out.

He calls Daniels' testimony "unduly and inappropriately prejudicial" against Trump and claims that Daniels has changed her story of the alleged encounter.

Donald Trump has just walked back into the courtroom after lunch.

His son Eric and lawyer Alina Habba are still here.

Image source, EPA

While the court is on a lunch break, it's worth reminding ourselves what this trial is all about.

Trump has been charged with business fraud over a hush-money payment to adult-film actress Stormy Daniels.

Daniels claims she and Trump had sex, and that she accepted $130,000 (£104,500) from his former lawyer before the 2016 election in exchange for her silence about the encounter.

Prosecutors allege Trump had his personal lawyer, Michael Cohen, make the payment. They say he then paid Cohen back, and fraudulently recorded the transactions in his company’s books as legal expenses.

Paying hush-money is not illegal, but the prosecution says how the payment was recorded amounts to election fraud.

Since the allegations surfaced in 2018, the former president has denied any sexual involvement with Daniels.

He's facing 34 counts of fraud under New York campaign finance laws, and has pleaded not guilty to all of them.

Want to know what Trump’s been getting up to when he’s not in court? North America correspondent Anthony Zurcher makes sense of the race for the White House in his weekly US Election Unspun newsletter.

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Image source, Donald Trump campaign

While Trump was in a New York court this morning, his campaign team sent out an email asking supporters for their loyalty and money.

The email features a lot of what we have already heard from the former president: talk of the judge being a Democrat, the trial being a "witch hunt" and Joe Biden being "crooked".

The email reads: "The Democrat Biden Judge thinks he can threaten me with JAIL TIME & you’ll abandon me!

"He knows losing your support would be the CRUSHING BLOW that sinks my campaign FOR GOOD."

In one line, Trump is quoted as saying "I need to know right here, right now that you will NEVER leave me", before supporters are urged to "chip in" and linked to a donations page.

Tiffany Wertheimer
US reporter

Woah, what a morning.

There had been some scepticism about the importance of Stormy Daniels’ testimony, because she knows nothing about what is at the heart of this criminal trial – Donald Trump’s financial records.

Oh how wrong they were.

What we’ve seen this morning was an at-times tense exchange between Daniels, the judge, and lawyers on both sides.

Often giving very long answers, Daniels had to be told more than once to stay on topic by Justice Merchan. She was also asked to speak more slowly, so the stenographer transcribing the proceedings could keep up.

The judge also cracked down on prosecutors, telling Susan Hoffinger to tone down questioning, so as to limit the explicit nature of some of the answers.

Trump’s lawyers objected to nearly every question from Hoffinger, and Justice Merchan often sided with them.

Much of what we heard wasn’t new – Daniels has given interviews before, and even written a book.

In regards to the hush-money payment, she saw it as a win-win, because she didn't want her partner finding out about the alleged sexual encounter, and she would be paid.

The money was paid late, and she signed the agreement using a fake name - Peggy Peterson.

Trump has always denied having any sexual encounter with Stormy Daniels.

Madeline Halpert
Reporting from court

Stormy Daniels says she didn't receive the hush-money payment on time.

She says Trump gave excuses to his lawyer, Michael Cohen, who told Keith Davidson, her lawyer, why it was late.

And with that, it's announced that we're taking a lunch break.

Daniels walks off the witness stand and sweeps by the defence table - she doesn't appear to look at Trump.

Stay with us as we continue covering the highly anticipated testimony.

Kayla Epstein
Reporting from court

We've returned to the 2016 agreement and legal documents meant to secure Daniels' silence, which her then-attorney Keith Davidson hashed out with Michael Cohen.

Under the agreement, she would be paid $130,000 and she could not speak publicly about her story of having sex with Trump.

We've already seen these documents - the settlement agreement, a side letter agreement - during testimony from Davidson earlier in the trial. He told us how he negotiated the deal.

Now we're hearing about Daniels' experience of signing the document using a fake name, Peggy Peterson. Daniels testifies that she signed with the fake name to keep the true nature of the parties confidential.

Kayla Epstein
Reporting from court

Daniels is beginning to tell her side of the hush-money deal struck in October 2016.

She says she came to understand that Trump and his lawyer, Michael Cohen, were trying to buy her story about an alleged sexual encounter. Her manager, Gina Rodriguez, alerted her to what was happening, she explains.

Daniels testifies that she understood Cohen was representing Trump, and that Cohen was “interested in paying for my story".

She says that a deal would have been a win-win, because she didn't want her partner finding out about the alleged encounter with Trump and she would've been paid.

She adds that she didn't try to negotiate the $130,000 price for her story that Cohen ended up paying - because, Daniels says, she "didn't care" about the money.

Daniels testifies she was financially successful at the time.

Image source, Reuters/ Jane Rosenberg

A court sketch that just arrived in our newsroom is of today's first witness, Sally Franklin - but the cover of one of Trump's books steals the spotlight.

Sally Franklin, who works with Penguin Random House, testified about different selections in his books and was asked how Donald Trump worked with another author to write them. Prosecutors seemed to seek to use Trump's own words against him, while the defence sought to distance him from some of the text..

Madeline Halpert
Reporting from court

We’re fast forwarding to 2015 now, before Trump was running for president.

Daniels says she started getting a lot of offers to tell her story about their alleged sexual encounter - but she says she wasn’t sure how to handle them because of the threat she had received in a Las Vegas car park (see our previous post).

She decided to let her manager, Gina Rodriguez, try to sell her story, she tells the court.