UK gilt-edged stocks fell to their lowest for 21 months, influenced by US Treasuries and reports of heavy post-Christmas retail spending. Yields on ten-year benchmark bonds rose from 4.73 per cent to 4.79 per cent, the highest since March 2005.
US housing market Early evidence that the downturn in the US housing market might be easing stemmed a fall in the dollar but hit prices of US Treasury bonds. Sales of new US homes in November were unexpectedly strong, rising by 3.4 per cent from October. The supply of unsold homes also fell.
US oil prices eased marginally after an official prediction that mild Christmas weather would cut the US weekly demand for heating oil by a quarter.
China’s Government has raised land development charges for commercial projects in a further attempt to stem the country’s investment boom.
Banking & finance
Up 1.1%
Credit Suisse Leonhard Fischer, who revived Winterthur, the insurance group, has been touted as the next chief executive of Credit Suisse, its parent company.
Construction & property
Up 1.7%
Globe Trade Centre, the leading Polish property developer, said that it had agreed a deal to build a €265 million (£178 million) shopping and office complex in Prague, the Czech capital.
Consumer goods
Up 1%
Leica Camera ACM, the Austrian investment group, offered €12.50 a share to buy the remaining 7 per cent in Leica Camera, the loss-making German camera maker, that it does not already own.
Engineering
Up 0.5%
Ford shares rose on hopes that the US car maker would secure co-operation work with Toyota, its Japanese rival, after talks in Japan between Alan Mulally, chief executive of Ford, and Fujio Cho, chairman of Toyota, in Japan. Toyota said the talks did not include forming an alliance.
Siemens A group of employees of Siemens, the German engineering and technology company, plan to withhold their approval of management at a shareholders’ meeting amid a corruption scandal. They are angered by management’s failure to prevent the alleged corruption and by the fact that some directors were awarded 30 per cent pay rises as the company cut some jobs and reduced staff wages.
McDermott International, the US engineering and energy services company, said that it has made a final payment to Babcock & Wilcox’s asbestos-related reorganisation, and will take a charge of $5 million (£2.5 million) in the fourth quarter.
MAN, the German truck maker and engineering group, wants to offer Investor, a shareholder in Scania, the Swedish truck maker, a supervisory board seat in the event of MAN taking over Scania.
Boeing The Ministry of Defence is planning to buy three C17 Globemaster IIIs from Boeing, the US aerospace group, for about $660 million (£337 million) as fears grow about the delivery schedule for the rival 400M from Airbus, the European aircraft maker.
Health
Up 0.9%
SkyePharma, the drugs maker, said that the development of its Flutiform treatment for asthma was incurring higher costs than had been expected and that it had arranged a new £35 million loan. The company also said that it was in exclusive talks with a possible buyer of its loss-making injectable drugs unit.
Prescription drugs Popular heartburn medications such as Nexium, Prevacid and Prilosec can increase the risk of broken hips in people over 50, a study has found. The research, which examined the way the drugs can block the body’s production of calcium, has raised questions about the safety of some of the most commonly used prescription drugs.
Mölnlycke Health Care Apax, the private equity group, has appointed Deutsche Bank and Goldman Sachs to handle the flotation of Mölnlycke Health Care, the Swedish surgical and woundcare equipment group, which is valued at up to £2 billion.
Industrials
Up 2.3%
Steel makers CVRD, the Brazilian mining giant, said that its leading Asian steel customers had agreed to a 9.5 per cent rise in iron prices for their 2007 contracts. The company has reached agreement with Pohang Steel, the South Korean group, and five Japanese clients, Nippon Steel, JFE Steel, Sumitomo Metals, Kobe Steel and Nisshin Steel.
Leisure
Up 1.4%
First Choice Holidays has bought LateRooms, the online seller of late-availability hotel rooms, for up to £120 million.
InterContinental Hotels Group shares reached record highs amid speculation that the hotel operator could be a takeover target. IHG shares rose almost 3 per cent in thin post-Christmas trading after reports that the company could receive an offer from a private equity group valuing it at about £15 a share, or £5.7 billion.
Media
Up 0.4%
EON Productions The latest James Bond movie Casino Royale, made by EON Productions, has become the highest-earning 007 thriller so far. The film, featuring Daniel Craig playing the British superspy for the first time, has passed the previous box office record held by a Bond movie, the $431 million earned by 2002’s Die Another Day. To date, Casino Royale has earned $448 million (£229 million) worldwide since its opening in November.
Arabian Television Network said that it was joining forces with Viacom, parent company of MTV, to launch MTV Arabiya in 2007.
Natural resources
Up 1.4%
South China Resources, the London-listed miner, has agreed to buy a 53 per cent stake in the Zhunuo copper project in Tibet for 53 million yuan (£3.5 million).
Pantheon Resources, the oil and gas explorer, made a net loss of £339,514 in the period from incorporation on March 8, 2005, to June 30, 2006. Last week Pantheon said that test results from the Kindee well in Texas show that the zone is unlikely to contain commercially recoverable hydrocarbons. The company said that drilling at the next planned core point is under way.
Retailing
Up 1.8%
Moss Bros shares rose by 10½p or 15.9 per cent on renewed rumours that Baugur, the Icelandic retail investor which jointly owns a 29 per cent stake in the men’s clothing retailer, is planning an £80 million bid.
Boots, the health and beauty retailer, aims to double the number of customers involved in its Change One Thing campaign in January after it boosted sales of nicotine replacement patches by 30 per cent a year ago.
Support services
Up 0.8%
PricewaterhouseCoopers, the accountant, is facing court action over allegations in Russia that it provided false audits for Yukos, the collapsed oil company. Russian tax officials have accused the accountancy group of producing “distorted” audit reports between 2002 and 2004.
Technology
Up 1.4%
Apple shares fell by 6 per cent during morning trading after a media report claimed that details on stock option documents had been “apparently falsified” by officials of the computer company. The shares traded as low as $76.77 before recovering to $78.14 — a drop of 4.2 per cent.
Telecoms
Down 0.3%
Hutchison Essar The multibillion-dollar bidding war for Hutchison Essar, the Indian mobile phone group, is being clouded by a dispute between the two brothers who hold a key stake in the telecoms company.
Transport
Up 1.7%
American Airlines FL Group, the Icelandic investor, said that it has high hopes for AMR, the parent company of American Airlines, in which it bought a 6 per cent stake this week. Hannes Smarason, the chief executive, likened AMR stock to easyJet, the British low-cost airline, in which FL made a £140 million profit in April.
Ryanair, the low-cost airline, has lost its battle to win control of an internet domain name from a disgruntled former customer after a ruling issued by a United Nations panel. Michael Coulston set up a website in July under the domain name www.ryanaircampaign.org, which is critical of Ryanair’s business practices and invites contributions from other unhappy passengers.
Utilities
Up 1.6%
Gazprom, the Russian state energy monopoly, said that the worsening dispute between Russia and Belarus over gas prices could hit Western European energy supplies next week in an apparent rerun of last year’s gas crisis with Ukraine. Russia has threatened to turn off the gas supply to Belarus on New Year’s Day if an agreement cannot be reached on new price rises.
Avista, the US utility, said that Washington regulators had dismissed its bid to increase rates by 8.8 per cent. Avista had sought the rate rise to help to recover costs from its investments in generation and transmission infrastructure and increased demand.
sectors@thetimes.co.uk
Up/down= sector index percentage change on day
