Economics
Industrial activity rose in July at its fastest pace for three years,
driven by a surge in new orders, according to the CIPS/NTC purchasing
managers’ index. Its gauge of activity climbed to 55.7 from 54.7 in June,
where any figure above 50 indicates rising activity. Companies raised prices
at their fastest pace since the index began in 1992. Input price inflation
also rose and was at its highest in almost a year.
Interest rates All nine members of The Times Monetary Policy Committee
voted to keep interest rates at 5.75 per cent this month. The Bank of
England is expected to do the same at the conclusion of its monthly meeting
today.
Eurozone manufacturing activity fell to a 17-month low in July, hit by
a strong euro and high oil prices. The eurozone’s purchasing managers’
index, compiled by NTC Research, was revised up to 54.9, from a provisional
estimate of 54.8, but was still down from 55.6 in June. It was the weakest
reading since February 2006.
French tax cuts France’s Parliament has approved a package of tax cuts,
delivering on some of the pledges made by President Nicolas Sarkozy less
than three months after he took office. The measures are expected to cost
about €11 billion (£7.4 billion) in 2008.
US manufacturing activity in July fell to its lowest in four months,
according to data from the Institute for Supply Management. Its index of US
manufacturing activity fell to 53.8, from 56 in June.
US crude oil hit a new record high of $78.77, before falling back by
more than $2 in later trading. In London, Brent crude fell by $1.95 to
$75.10.
US home sales The index of pending US home sales rose in June by 5 per
cent, its biggest gain in more than three years.
US economy The shake-out in America’s sub-prime mortgage market and the
tightening financial conditions it has triggered could jeopardise prospects
for a revival in the US economy next year, the International Monetary Fund
said.
Banking
& finance
Up 0.4%
HBOS, the banking group, will launch a 25-year fixed-rate mortgage in
an attempt to attract homebuyers. Earlier it disclosed that its share of new
mortgages had more than halved this year.
Prudential, the insurer, reported a 41.1 per cent rise in first-half
pre-tax profits to just over £2 billion, from £1.4 billion last time.
London Stock Exchange Kinetics Asset Management and Horizon Asset
Management, two of the biggest shareholders in the London Stock Exchange,,
said that they would support the €1.6 billion (£1.1 billion) deal to buy
Borsa Italiana.
Mortgage lenders that persist in charging unfair exit fees could face
court action, according to the Financial Services Authority, the industry
watchdog.
ABN Amro’s board members are set to receive a substantial pay
rise if Barclays beats the Royal Bank of Scotland-led consortium in the
battle for the Dutch bank.
Investment banks on both sides of the Atlantic are saddled with almost
$500 billion (£246 billion) in agreed leveraged loans that they are unable
to parcel out to other investors.
Construction
& property
Up 0.1%
Savills, the UK property agency, has paid $54 million (£27 million) for
Granite Partners, the New York-based commercial property investment
advisers, whose 18 property agents last year had turnover of $15.4 million.
Westfield, the shopping mall developer behind the new White City
scheme, has landed Louis Vuitton as a new tenant for the West London
shopping centre, the first time the luxury goods brand has opened a store in
a UK shopping centre.
Travis Perkins, the building materials group, reported a 9.6 per cent
rise in like-for-like half-year revenue from its merchanting division but
saw same-store sales from retail showrooms fall 7.4 per cent as homeowners
felt the squeeze from higher interest rates.
Chartered surveyors are at their most confident since 2001 of future
rent rises, according to data from the Royal Institution of Chartered
Surveyors, which were justified by separate figures from DTZ which showed
that second-quarter take-up of Central London offices was 4.6 million sq ft,
a 39 per cent increase on the first quarter.
Consumer
goods
Down 1.1%
Miller Brewing, the US beer company owned by SABMiller, is suing former
executive Hasan Yardimci, claiming that he had downloaded pricing and
strategic planning files and taken them with him when he joined Diageo, the
rival drinks group.
Scottish & Newcastle’s Baltic Beverages Holding joint venture
reported a 48 per cent rise in first-half operating profits on the back of
unseasonably mild weather in Russia, where volumes grew by 30.8 per cent.
Cadbury Schweppes, the confectionery and soft drinks group, blamed
rising milk prices for contributing to a slide in first-half pre-tax profits
to £182 million, from £819 million last time.
Engineering
Up 0.3%
BMW, the German carmaker, reported a 13.6 per cent decline in
second-quarter pre-tax profits to €1.065 billion (£718 billion).
Ford Motor, the US carmaker, reported a sales decline in July down by
19 per cent compared with a year ago.
Health
Down 0.2%
Sanofi-Aventis, the French drugs maker, blamed competition from rivals’
generic copies of its bestselling drugs and a weaker dollar for a decline in
second-quarter net profits to €1.68 billion (£1.13 billion), compared with
€1.79 billion last time.
Industrials
Up 1.5%
Arcelor Mittal, the world’s largest steelmaker, reported second-quarter
earnings of $2.72 billion (£1.34 billion) as increased sales at higher
prices offset the rising costs of raw materials.
Leisure
Up 0.2%
Arena Leisure, the racecourse operator, defied the poor summer weather
to report a 5.6 per cent rise in first-half attendances and announced that
it had won planning consent for a £23 million expansion of Wolverhampton
Racecourse.
LA Fitness, the health club operator, reported an upturn in trading as
a result of the poor summer weather, achieving a 39 per cent increase in
like-for-like visitor levels in June and July.
Von Essen Hotels, the luxury hotels operator, is believed to be close
to acquiring Amberley Castle, the country house hotel in West Sussex.
Accor, the French hospitality group, sold its Italian catering business
to Barclays Private Equity for €135 million (£91 million).
Meritage Hospitality, the US restaurant franchisee, announced plans to
open a number of new Wendy’s hamburger outlets, just one day after Nelson
Peltz, the billionaire activist investor, said that he wanted to buy
America's third-largest hamburger chain.
Media
Up 0.4%
Time Warner, the US media group, reported quarterly profits up 5 per
cent to $1.07 billion (£527 million), from $1.01 billion last time.
Virgin Media, the pay-television group, has had to amend two
advertisements after the Advertising Standards Authority said it had misled
consumers.
Guardian Media Group, parent company of The Guardian newspaper, said
that it may enter the auction for parts of Emap, the £1.8 billion media
group.
EMI, the embattled music company, has been taken over by Terra Firma,
the private equity group, as more than 90 per cent of shareholders voted in
favour of the £2.4 billion deal.
Natural
resources
Up 1.5%
Anglo American, the mining group, has signed a deal for a subsidiary to
be a 50 per cent partner with an affiliate of Northern Dynasty Minerals in a
copper, gold and molybdenum project in Alaska.
Gazprom, the Russian gas monopoly, is poised to cut shipments of gas to
Belarus, the former Soviet satellite state, in a confrontation over unpaid
gas bills that could jeopardise Central European gas supplies.
Retailing
Up 0.3%
Kingfisher, the DIY retail group, has signed a sale and leaseback
contract on its B&Q distribution centre in Nottinghamshire for £73
million. Kingfisher said that it plans to use the proceeds to repay existing
debt and invest in its global store opening programme.
Sports Direct, the sportswear retailer, has raised its stake in the
Finnish group Amer Sports, the owner of Salomon, the ski brand, and the
Wilson golf equipment brand, from 5.4 per cent to 10.64 per cent.
Support
services
Up 0.4%
Hogg Robinson, the business support company, said its first-quarter
revenues were higher than last time and added that it remains confident of
its full-year prospects.
Technology
Up 0.1%
Google, the internet search engine, said that its plans to bid for a
portion of America’s airwaves had been dealt a blow when the US Federal
Communications Commission refused to approve two of its conditions.
ISoft, the troubled UK healthcare software supplier, reported a halving
in full-year profits to £6.6 million, from £13.3 million last time, but said
a recommended takeover offer by Compugroup, its German rival, and an
improved cash position meant that it was well placed for a return to growth.
Telecoms
Unchanged
Mobile licence A fourth mobile licence is to be offered in Portugal in
December, the regulator said. The auction could be restricted to bidders who
do not hold existing mobile licences.
Transport
Up 0.9%
EasyJet, the low-fares airline, said that Blackrock, the investment
management group, has bought 21.33 million shares, taking its indirect stake
in the airline to 5.09 per cent.
Utilities
Down 0.5%
British Gas has launched “zero carbon” and “future energy” tariffs as
the latest initiative to meet customers’ demand for “green” energy tariffs.
Up/Down = sector index percetage change on day
