Economics
Interest rates The Bank of England has kept interest rates unchanged at
5 per cent.
House prices fell by 1.7 per cent last month, pushing the annual drop
to 11 per cent, according to Halifax, the UK’s biggest lender. Prices in the
three months to July were 8.8 per cent lower than in the same period last
year. The average house price is £177,351. down from £199,600 when the
market peaked in August last year.
New construction orders fell by 7.5 per cent between April and June,
against the first three months of the year, driving the annual decline to 21
per cent. New orders for private housing fell by 35.1 per cent year-on-year.
Eurozone interest rates The European Central Bank has kept eurozone
interest rates unchanged at 4.25 per cent.
German industrial output rose by 0.2 per cent in June, taking the total
decline in the second quarter to 1.7 per cent, official data indicated.
May’s decline was revised up to 1.8 per cent.
US pending home sales The Pending Home Sales Index, which is based on
contracts signed in June, was up 5.3 per cent to 89 from a downwardly
revised 84.5 in May. It was the highest reading for the index since October
last year.
US unemployment The number of individuals filing new claims for US
unemployment insurance in the week ending August 2 rose by 7,000 to 455,000,
the highest level since March 2002. Claims had been forecast to fall to
430,000.
Banking
& finance
Barclays rebuked rival bankers and short-selling hedge fund managers
for suggesting that its results could not be believed as it reported a 33
per cent slide in first-half pre-tax profits to an “acutely disappointing”
£2.8 billion.
Friends Provident, the insurance group, reported a 20 per cent drop in
first-half profits to £211 million on falling sales and margins and
confirmed that it had been unable to attract serious bids for its wealth
management businesses.
Benfield, which specialises in offering earthquake, kidnap and ransom
cover, reported a 0.4 per cent fall in first-half trading profits, hit by
the softening reinsurance market.
American International Group saw its shares fall by 18 per cent as the
world’s biggest insurer refused to rule out the issue of new shares that
would dilute the ownership of its existing investors.
RSA Insurance reported a rise in first-half profits to £292 million
after overseas premiums jumped by 23 per cent to £1.63 billion, as
international growth offset flat trading in the UK.
Bank of Scotland, which raises funding for HBOS, its parent company,
sold €750 million (£593 million) in euro-denominated two-year floating rate
notes, which is half the size of the amount raised in a note issue in May.
Financial Services Authority Sir Callum McCarthy, the outgoing chairman
of the Financial Services Authority, the City regulator, will join the board
of the Treasury after he leaves the regulator next month.
Citigroup, America’s biggest financial services company, has agreed to
a $7.6 billion (£3.9 billion) landmark deal with regulators to settle
charges that its mis-sold debts to customers in a deal described as “another
body blow” to the banking industry.
Construction
& property
Hammerson, the office and shopping centre investor, reported a 6.4 per
cent dip in the value of its UK and French assets, but robust rental income
growth buoyed half-year pre-tax profits.
Consumer
goods
Cains Beer Company, the Liverpool brewer and pub operator, has been put
up for sale after the collapse of talks with its bankers and the appointment
of PricewaterhouseCoopers as administrator. About 1,000 jobs are under
threat.
Diageo, the drinks group, has signed a partnership deal with Dalkia,
the energy management company, to create a £65 million bio-energy facility
at its distillery in Cameron Bridge in Fife.
Nestlé, the Swiss food company, reported a 6 per cent rise in its
first-half net profits to SwFr5.2 billion (£2.53 billion) and said that it
was accelerating its share buyback programme, but currency effects had
weighed on sales.
Engineering
Cobham, the aerospace and defence company, reported a 24 per cent rise
in first-half profits, beating forecasts, and said that it expected to be
slightly ahead of its growth targets in 2008. The company said that it had
benefited from robust US military and national security markets.
Pininfarina Andrea Pininfarina, chief executive of Pininfarina, the
design group best known for styling classic Italian sports cars, died when
his Vespa scooter was hit by a car near Turin, close to where the company is
based. He was 51.
Toyota Motor, the Japanese carmaker, reported a 28.1 per cent
year-on-year dip in quarterly net profits as American and European car
markets crumpled under high petrol prices and economic strain. The company
also admitted that it was reviewing a key target for next year that would
have taken the company’s annual vehicle sales above ten million units.
Health
Sinclair Pharma, the speciality pharmaceuticals group based in Surrey,
said that it was in talks with a party about a strategic opportunity and
added that it had also received an inquiry from another party, which may or
may not lead to an offer being made.
Acambis, the vaccine maker based in Cambridge, said that its half-year
pre-tax loss had narrowed to £12.2 million, from a £19.3 million loss last
time, while revenue rose to £8.8 million, from £3.4 million a year ago.
Smith & Nephew, the maker of medical devices, said that it would
sue the sellers of Plus, the orthopaedics business that it bought last year
for $899 million (£457 million), after finding what it described as
“unacceptable sales practices” at the company.
Industrials
ArcelorMittal, the steelmaker, said that it would invest $1.6 billion
(£823 million) to boost its long carbon steel capacity in Brazil by 2.6
million tonnes a year. The new investment programme, which is expected to
last 30 months, will raise its capacity in Brazil to 6.5 million tonnes a
year, from 3.9 million tonnes.
Leisure
Jurys Inns Quinlan Private, the Irish property investment group that
owns Claridge’s, the luxury London hotel, announced that it had sold 50 per
cent of Jurys Inns, which it bought last year for €1.15 billion (£909
million), to the Oman Investment Fund, an investment arm of the Sultanate of
Oman. The deal is understood to value Jurys at the same price that Quinlan
paid last year.
Ladbrokes, the betting chain, said that its first-half pre-tax profits
fell by 16 per cent to £134 million, compared with the same period last
year, as high- rolling customers moved to offshore gambling operations and
the Euro 2008 football championship was won by Spain, the favourite.
Millennium & Copthorne, the hotels group, reported first-half
pre-tax profits up by 9.2 per cent to £60.3 million, but said that although
it was tracking in line with expectations, its growth in Asia had slowed in
recent months.
Travelodge, the budget hotel chain, is spending £150 million to build
55 seaside hotels, creating about 1,000 jobs. A quarter of those jobs will
be open to long-term unemployed people through the Government’s Local
Employer Partnership programme.
BetOnSports Three Florida men associated with BetOnSports, the online
gambling company, face sentencing in October after pleading guilty to
federal charges. Cases are still pending against Stephen Kaplan, the
BetOnSports founder, and David Carruthers, the former chief executive.
Media
Warner Music, the US group, reported a fiscal third-quarter loss from
continuing operations of $9 million (£4.6 million), narrower than the $16
million that it lost in the same period a year ago.
Natural
resources
International Power said that an extended outage at its Rugeley
coal-fired power station in Staffordshire could cost it £45 million. The
site went offline for planned work in the first half, but one unit is
expected to be out of service until the end of the third quarter.
Rift Oil said that the potential resources of the Puk-Puk field in
Papua New Guinea were about 430 billion cubic feet of gas and 8.5 million
barrels of condensate, double its pre-drilling estimates.
Lonmin, the platinum producer, has told its shareholders to reject the
unsolicited $10 billion (£5.14 billion) takeover approach from Xstrata as
the Anglo-Swiss miner starts building up its stake by buying more Lonmin
shares in the market.
Retailing
Marks & Spencer The Wellcome Trust, Britain’s largest charity, has
emerged as the mystery investor that has been building a stake in Marks &
Spencer. The charity said that it had taken a 2.5 per cent shareholding in
the high street retailer, acquiring 39.35 million shares, as part of its
long-term investment strategy.
Flying Brands Sir Tom Hunter, the retail entrepreneur, has tabled an
undisclosed bid for Flying Brands, the struggling home shopping group. Its
shares rose by nearly 30 per cent, valuing the company at £17 million.
Woolworths, the high street retailer, saw its shares rise by 9 per cent
after it revealed that Ardeshir Naghshineh, the property tycoon, had bought
another seven million shares to take his holding in the group to 10.2 per
cent.
Signet, the jewellery group, reported a 0.6 per cent slide in
second-quarter like-for-like sales in the UK, reversing the 5.3 per cent
rise seen in the previous three months. A weaker US performance dragged its
overall comparable sales down by 4.5 per cent.
Alliance Boots, the health and beauty retailer, is poised to form a
partnership with Reliance Industries, the Indian petrochemicals group, that
would take the retailer to the sub-continent.
Support
services
4imprint Group, the promotional products supplier, said that its
first-half pre-tax profits rose on sales up by 13 per cent and added that it
saw further progress in the second half.
Technology
Autonomy, the software group based in Cambridge, said that it had
entered into an agreement with De Nederlandsche Bank, the Dutch central
bank, to license Autonomy’s intelligent data operating layer software.
Telecoms
WIN, the provider of media, entertainment and data communications, said
that it had received an approach from a third party regarding a possible
business combination that could result in an offer being made.
Transport
Ryanair, the budget airline, has been in talks with Boeing and Airbus
about aircraft purchases beyond 2012. The purchase would probably be about
200 firm orders and with options for an additional 200 aircraft.
British Airways The Office of Fair Trading has charged four past and
present executives of British Airways with conspiring with their
counterparts at Virgin Atlantic, BA’s rival, to fix the price of fuel
surcharges on long-haul flights.
Utilities
British Energy The share of electricity generated by British Energy’s
nuclear power stations has fallen to 15 per cent of total demand — its
lowest level in 21 years — according to government figures.
