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Economics
Services sector: The CIPS/Markit report showed that the services sector
shrank in October at the fastest pace since 1996. The headline services
activity index plunged to 42.4, well below the forecast of 44.5. It marks
the sixth consecutive month below the growth threshold of 50 that separates
growth from contraction, the longest losing streak in the survey’s 12-year
history.
Manufacturing output: Official data showed that manufacturing output
fell by more than expected in September to mark the longest stretch of
monthly declines in 28 years. Output dropped by 0.8 per cent, while the
wider measure of industrial production declined by 0.2 per cent.
GDP: Figures from the National Institute of Economic and Social
Research showed that GDP fell by 0.5 per cent in the three months to
October. This is the same rate of decline as shown in the third quarter,
suggesting that output could shrink at similar rate in the final quarter of
the year.
Eurozone services sector: The final Markit Eurozone Purchasing
Managers’ Index showed that the eurozone services sector dropped to a record
low in October, falling to 45.8 — the lowest in the survey’s ten-year
history and well below the flash estimate and forecasts of 46.9.
Eurozone retail sales: Data from the European Union’s statistics office
showed that eurozone retail sales fell less than expected in September,
declining by 0.2 per cent during the month and by 1.6 per cent year on year.
Economists had forecast a 0.4 per cent month-on-month drop and a 2.3 per
cent annual fall.
US non-manufacturing activity: The Institute for Supply Management said
that its gauge of US non-manufacturing activity fell to 44.4 in October,
from 50.2 in September. A reading of 47.5 had been forecast.
Banking
& finance
HSBC: The banking group will decide within the next six weeks whether
to press ahead with controversial changes to its pension arrangements that
could trigger a damaging clash with unions.
BNP Paribas: France’s largest bank said that third-quarter profits had
fallen by more than half after the collapse of Lehman Brothers and the
worsening financial crisis. Shares in the bank fell by more than 3 per cent
after it said its net income had declined to €901 million (£728 million),
from €2.03 billion a year earlier.
GMAC: The US finance company owned by General Motors and Cerberus, the
private equity group, reported a third-quarter loss of $2.52 billion (£1.56
billion) because of heavy losses from the housing meltdown. This compared
with a loss of $1.6 billion a year ago and left the group in the red for the
fifth consecutive quarter.
Working time directive: Britain’s opt-out from the maximum working week
of 48 hours imposed by the European Union is under threat after a Labour MEP
joined a revolt in Brussels in opposition to Gordon Brown.
Allied Irish Bank: The bank, which is covered by an Irish Government
scheme that guarantees all savers’ money, said that it will scrap its
dividend to try to support its balance sheet, sending its shares down by 9
per cent.
Italian banks: Silvio Berlusconi, the Italian Prime Minister, said his
Cabinet would create a reserve fund to support Italian banks, but added that
no bank had yet asked for help and that it had no plans to take stakes in
banks’ share capital unless requested to do so.
UBS: The loss-making Swiss bank said that it has been examining the
possibility of reclaiming the huge bonuses paid to its former executives and
will update its shareholders later this month.
Council of Mortgage Lenders: The lobby group representing banks and
building societies said that homeowners should not expect cheaper mortgage
repayments even if the Bank of England cuts interest rates.
Lehman Brothers: Dick Fuld, chief executive of Lehman Brothers, the
collapsed US investment bank, will not receive any bonus or severance pay.
He was widely criticised for having done little to save the company from
collapse.
Ulster Bank: The Irish arm of Royal Bank of Scotland is not
participating in the Irish Government’s bank guarantee scheme, saying it was
satisfied that the UK Government’s measures will provide its parent with the
necessary protection and security.
Construction
& property
Rok: The building group that is based in Exeter is to cut 750 jobs
because demand for the construction and refurbishment of social housing is
falling. It said projects worth more than £150 million had been postponed or
cancelled by public and private clients following the banking crisis.
Redrow: The Flintshire housebuilder said reservations had plunged by 45
per cent year-on-year since June in an “extremely fragile” property market.
Liberty International: The UK’s biggest owner of shopping malls said
that it has more than doubled last year’s provisions for tenant failures,
raising a contingency fund for bad debts to £10.2 million, from the £4.5
million available in September 2007.
Cement cartel: Some of the world’s largest cement manufacturers are
being investigated by the European Commission after being suspected of
operating an illegal cartel to push up prices.
Monier Group: The former Lafarge Roofing business, which owns Redland
Roof Tiles in the UK, has hired Goldman Sachs to restructure an estimated €2
billion (£1.6 billion) of debt and head off the danger of it breaching
banking covenants next month.
Consumer
goods
Carlsberg: The Danish brewer cut its forecast for full-year operating
profit growth from 12 per cent to 8 per cent and announced plans to close
the Tetley’s brewery in Leeds in 2011, putting 170 jobs at risk.
Engineering
Cobham: The aerospace and defence group, which is based in Dorset, said
it had experienced strong organic growth in the first nine months of 2008
and remained confident of its outlook.
Health
GlaxoSmithKline: Britain’s biggest drugs maker said that it will cut
about 1,000 US sales jobs, a reduction of 12 per cent, by the end of this
year as it reshapes the operation to compete in an increasingly tough
market.
Sanofi-Aventis: The French pharmaceuticals group said it would
discontinue all clinical trials involving Accomplia, its anti-obesity
treatment. Last month European health authorities said Accomplia should be
withdrawn because of links to mental disorders.
Industrials
ArcelorMittal: The world’s largest steelmaker is to cut output by
almost a third as the global economic downturn hits demand for the steel
used in construction and cars. The company had formerly planned to increase
steel shipments by a fifth by 2010.
Leisure
Ellerman Investments: The London hotel and gaming group controlled by
the Barclay family scaled back daytime casino operations at the Ritz Club
after a fall in turnover last year to £15.3 million, from £20.7 million
previously. Ritz Hotel turnover rose by 11 per cent to £28.9 million.
Ellerman said it valued the hotel at more than £600 million, £4.4 million a
room, and the casino at £25 million.
McDonald’s: Europeans spend an average of €19.47 (£15.84) a year
at McDonald’s, the hamburger chain, less than a third of the average US
consumption, according to Horizons, the consultancy.
Muir Group: The Scottish property company has won planning consent for
a £115 million project to turn Blairs College, Deeside, into a luxury hotel
with a golf course designed by Paul Lawrie, who won the Open in 1999.
Media
ITV: The commercial broadcaster said that its advertising revenues
would fall by 9 per cent in the Christmas quarter, reflecting the impact of
a weak economy. It also said that Jeff Henry, the executive responsible for
ITV Play, the controversial phone-in quiz show, would leave the group.
Time Warner: The owner of Warner Bros film studios has cut its
full-year forecast for income growth to about 5 per cent, down from its
previous prediction of between 7 and 9 per cent, despite reporting better
than expected third-quarter results.
News Corporation: The parent company of The Times reported a 30 per
cent decline in first-quarter profits, partly because of falling revenues
from television advertising.
Natural
resources
Total: The French oil group beat forecasts to report a 35 per cent jump
in third-quarter underlying profits to €4.07 billion (£3.28 billion),
against €3 billion last time, as high oil prices and strong refining margins
made up for a drop in its crude oil and gas production.
Royal Dutch Shell: The Anglo-Dutch oil group will be the first big
Western oil company to move large numbers of expatriate staff into Iraq to
oversee its gas joint venture. It plans to employ up to 200 people in Basra,
where it has signed a preliminary deal worth up to $4 billion (£2.5 billion)
to process and market natural gas.
BHP Billiton: The Japanese Government ordered BHP Billiton, the miner,
to provide details of its proposed $78 billion takeover of Rio Tinto or face
possible criminal prosecution.
Retailing
Next: The fashion and homewares retailer said that like-for-like sales
had fallen by 4.4 per cent in the 14 weeks to November 1, in line with
expectations.
Home Retail Group: Meristem Holdings, the maker of flatpack furniture,
has gone into administration. It was responsible for £80 million of the
annual sales of Home Retail Group, mainly through Argos, Home Retail’s
catalogue shop.
Support
Services
Carillion: The Wolverhampton support services and construction group
said that its Middle Eastern joint venture has won contracts in Abu Dhabi
and Dubai worth about £600 million.
Wilmington: The education and training group said that bookings for its
courses had fallen in the first quarter, prompting a round of cost-cutting
in the company.
Interserve: The support services and building group, based in
Berkshire, has added to its £6 billion order book with new contract wins
since July and said it was “trading well” and in line with expectations.
Technology
Pace: The digital TV set-top box maker, based in West Yorkshire, said
that it was on target to meet expectations for this year, but currency
fluctuations would dent profitability in 2009.
Panasonic: The Japanese electronics group is preparing to make an offer
to buy Sanyo Electric, its rival, but may be forced into price negotiations
by Goldman Sachs and other investors. Panasonic’s offer could be worth as
much as $10 billion (£6.2 billion).
Google: The US internet group has snubbed Yahoo!, the US internet
search engine, by walking away from an agreed advertising partnership to
avert a “protracted legal battle” with US antitrust regulators.
Telecoms
Orange: The French mobile phone operator has slowed the launch of its
fixed-line broadband service in Britain and returned to the drawing board on
its planned internet-based TV service.
Unused spectrum: The US Federal Communications Commission has approved
opening up the “white spaces” — the unused airwaves between broadcast TV
channels — for wireless broadband use. Technology groups have campaigned to
free up the unused spectrum for public use by unlicensed wireless internet
devices.
Swisscom: The Swiss telecoms operator reported a 3.6 per cent drop in
third-quarter core profits, missing expectations, partly because of a
one-off cost from its iPhone launch. It confirmed its full-year targets,
forecasting revenue of about SwFr12.3 billion (£6.5 billion) and pre-tax
earnings of about SwFr4.8 billion.
Transport
FirstGroup: The transport company reported higher interim profits and
better than expected cost savings from its acquisition of Laidlaw, the US
school bus operator. FirstGroup, which runs the First Great Western rail
franchise, said that half-year adjusted pre-tax profits had risen by 44 per
cent to £107.1 million.
Olympic Airlines: Greece said that Qatar Airways, Iberia, Chrysler
Aviation, SkyOne and Swissport were among the companies that had expressed
interest in the sale of parts of Olympic Airlines, the state-run carrier.
Utilities
Portland Gas: The AIM-listed group said that its fundraising for a £500
million project to create underground caverns to store 1 per cent of the
UK’s total gas demand has been suspended, blaming the credit crunch.
