Economics
Mortgage lending The Bank of England said that the number of mortgage
approvals in June had fallen to 36,000, from 41,000 in May, the lowest level
since comparable records began in 1999. Approvals for remortgaging fell to
84,000, the lowest since July 2002. Net mortgage lending rose by £3.1
billion, the smallest increase since October 2000, while its annual rate of
increase fell to 7.5 per cent, the lowest since September 1999.
Unsecured consumer credit rose in June by £900 million, after an
increase of £1.3 billion in May and the weakest figure since January, the
Bank of England said. Total net lending to individuals showed a £4 billion
increase, the weakest since February 1999, while its annual rate of increase
fell to 7.4 per cent, the lowest since October 1997.
Retail sales during July were at their worst in 25 years, according to
a CBI survey. Its headline gauge of retail sales fell to minus 36 per cent,
from minus 9 per cent in June, to the worst reading since the survey began
in 1983.
Inflation expectations among households fell back during July,
according to a survey by YouGov for Citigroup. It showed that the average
expectations of the inflation rate over the next 12 months fell to 4.2 per
cent, from 4.6 per cent in June, which was the highest level since the poll
began in 2005. Expectations of inflation over the next five to ten years
also dropped, to 3.6 per cent, from 3.8 per cent.
German inflation Headline inflation in July on Germany’s EU-harmonised
measure was unchanged from June at 3.4 per cent.
US house prices The S&P/ Case-Shiller index of 20 American
metropolitan areas showed that home values fell by 15.8 per cent in May,
compared with a year earlier, in the worst decline since the survey began in
2000.
US consumer confidence rose during July, according to the monthly
barometer of sentiment from the Conference Board, a private research group.
Its headline confidence index rose to 51.9, from a 16-year low of 51 in
June.
Indian interest rates The Reserve Bank of India announced a 0.5
percentage point rise in the repo rate — at which it lends short-term money
to banks — to 9 per cent, a seven-year high.
Oil prices Benchmark US light crude fell by $3.30 to $121.43 in late
afternoon trade, while benchmark North Sea Brent crude fell by $3.56 to
$122.28.
World Trade Organisation talks in Geneva to rescue the deadlocked Doha
global trade round failed to agree measures to help the poorest nations to
protect their subsistence farmers.
Banking
& finance
Abbey, owned by Santander, the Spanish banking group, has overtaken
Halifax as the biggest lender of new mortgages in Britain. Abbey said that
its share of the new home-loan market rose to about 26 per cent in the first
half as rivals cut back on lending amid the credit crunch.
St James’s Place, the UK life assurer and wealth manager,
reported a drop in first-half profits but saw a record second quarter in
terms of new business.
Nomura, the Japanese broker, reported a quarterly net loss of 76
billion yen (£354 million), which compares with a Y75 billion profit last
year, mainly because of the global credit crunch and the collapse of
investor sentiment.
Construction
& property
Lupus Capital, the AIM-listed property investment group, said it
expects a 5 per cent fall in first-half like-for-like sales and reiterated
that it sees the second half as “difficult and uncertain”. But it added
that, with the inclusion of the Laird construction businesses, first-half
group sales and profits will be higher than last time.
Consumer
goods
PZ Cussons, the Stockport company that makes Imperial Leather and Carex
soaps, said full-year pre-tax profits rose by 13 per cent to £76.5 million,
sending its shares up by more than 10 per cent.
Matsushita Electric Industrial, the Japanese consumer electronics
group, said first-quarter profits had nearly doubled to 73 billion yen
(£344.7 million) from a profit of Y39.3 billion last time, thanks to global
demand for flat-panel televisions and digital cameras.
Bacardi, the Bermuda-based drinks company, is to take a significant
minority stake in Patrón tequila in a deal that will see John Paul DeJoria,
co-founder of the Las Vegas group, assume majority control.
Tullibardine, the privately owned Scotch whisky distiller, confirmed
that it had hired UBS, the investment bank, to help it to assess takeover
approaches worth an estimated £15 million.
Colgate-Palmolive, the American consumer products group, reported
second-quarter profits up by 19 per cent to $493.8 million (£250 million),
from $415.8 million last time.
Engineering
Bodycote, the engineering group, announced a 4.9 per cent rise in
interim pre-tax profits to £44.7 million and said that it was continuing to
trade in line with expectations.
Health
Sanofi-Aventis, the French drugs maker, and Bristol-Myers Squibb, its
US partner, suffered a setback when a German court backed marketing approval
for generic versions of Plavix, their blockbuster blood-thinning treatment.
Sanofi said the two groups would appeal against the decision.
Industrials
Croda International, the speciality chemicals company based in East
Yorkshire, reported a 64.1 per cent rise in first-half pre-tax profits and
said that it is confident of further progress.
AkzoNobel, the Dutch paint maker, reported second-quarter profits down
by 3 per cent and added that its pretax earnings would fall short of the
€1.87 billion (£1.48 billion) reported last time because of the slowdown in
the US and UK housing markets and rising raw material costs.
Leisure
Mitchells & Butlers, the pub operator, said that the Elpida Group
has increased its stake in the company to 10.08 per cent, from 9.06 per cent
previously. Elpida is the investment vehicle of John Magnier and J. P.
McManus, the Irish racing tycoons.
Restaurants suffered an 11 per cent rise in food costs last month,
according to figures from Horizons, the food service consultancy.
Separately, toptable.com, the restaurant reservations service, found that 50
per cent of diners were eating out less often because of a rise in the cost
of living.
Starbucks, the American coffee shop behemoth, insisted that its
international expansion plans remained intact after it announced the closure
of 61 of its 84 stores in Australia.
Beanscene, the chain of 14 coffee shops in Scotland, has been placed
into administration with KPMG after failing to secure new funding for
expansion.
Media
Contentfilm, the media rights owner, said that it has renewed and
extended its senior secured revolving loan facility to $45 million (£22.7
million), from $32 million earlier, and plans to utilise these funds in its
television and film operations.
Informa, the events and exhibitions group, has received a second
approach, believed to be from another private equity consortium led by
Blackstone. It is understood that Blackstone has obtained information on
Informa and is considering an approach with two other private equity groups
— Kohlberg Kravis Roberts and Permira.
Natural
resources
BP, the oil group, unveiled a 23 per cent rise in first-half profits,
boosted by record global crude prices. Replacement cost profit, which strips
out unrealised gains from changes in the value of fuel stocks, hit a record
$13.44 billion (£6.79 billion) in the first half, up from $10.93 billion a
year ago.
Rio Tinto, the mining group, said it will invest $2.15 billion to
expand its iron ore mine in Corumb Brazil, boosting annual capacity of the
mine from two million tonnes a year to 12.8 million tonnes.
Retailing
Inchcape, the FTSE 250 car dealership, said that low demand for
vehicles in the UK will wipe out profit growth, sending its shares down by
13 per cent. It reported that half-year pre-tax profits rose by 8.6 per cent
to £130.3 million, boosted by stronger than expected growth in Hong Kong.
Woolworths, the high street retailer, reported a sharp deterioration in
sales and margins during June and July.
Support
services
Bateman Litwin, the Dutch oil industry support services group, said
that it expects its full-year operating profits to be between $15 million
(£7.57 million) and $20 million, citing revisions, delays and negotiations
relating to its current orders. It also announced new contract wins.
Interior Services, the construction services company, said it has
received a confirmed extension to its framework agreements with leading
financial retailers and announced a new appointment from the HBOS banking
group.
Technology
CSR, the Bluetooth technology specialist based in Cambridge, said that
its third-quarter revenues would be towards the lower end of analysts’
expectations, reflecting the continuing “very tough” economic conditions.
Alcatel-Lucent, the US-French telecoms equipment company, has announced
its sixth successive quarterly loss. The company, which was formed in
December 2006, said that its second-quarter loss has risen from €336 million
(£265 million) last year to €1.1 billion.
Wolfson Microelectronics, the computer chip maker, said falling demand
for consumer electronics would mean its third-quarter revenues would be
lower than expected and that costs and jobs would be cut to fight the
downturn.
Telecoms
BT, the telecoms group, announced that it has acquired Ribbit, the US
platform company, for $105 million (£53.05 million). It said the acquisition
will accelerate its strategy to become a “next-generation, platform-based,
software-driven services company”.
Solution1, the communications service provider of voice and data
services, has won a multimillion-pound contract to provide and manage fixed
line telephony services to Anglian Water.
Transport
British Airways and Iberia, the Spanish flag carrier, announced that
they are seeking a merger that would create one of Europe’s largest
airlines. BA owns 13.15 per cent of Iberia and attempted to buy the Spanish
airline last year in partnership with TPG, the private equity group, but the
deal fell through. BA has traditionally been strong on routes from Heathrow
to the United States, while Iberia has firm links with South America.
Lufthansa Some 4,000 Lufthansa employees stopped work for the second
day of a strike for higher wages, causing Germany’s largest airline to
cancel more than a dozen flights and give warning that more cancellations
may follow.
The Airports Council International said that nearly 4.8 billion
passengers used the world’s airports last year, up by 6.8 per cent on 2006.
Atlanta’s airport was the world’s busiest, with 89.4 million arrivals and
departures.
Utilities
Bluewater Bio International, the London-listed waste water treatment
company, said that it has conditionally raised £2 million through a placing
of new shares with Lehman Brothers International (Europe) in two tranches.
