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Economics
Monetary moves: The Bank of England has paused for breath in its battle
to combat the economic slump and pegged interest rates for the first time in
six months at their present 315-year low of 0.5 per cent. It also stayed its
hand over any changes in its radical quantitative easing plan to jump-start
growth by “printing money”.
Trade gap: Britain’s deficit on trade in goods narrowed to £7.3 billion
during February, from £7.8 billion in January, as both exports and imports
fell. However, there was little sign that the steep fall in the value of the
pound is yet delivering a significant boost to exports, with volumes of
goods sold abroad down by 14 per cent from levels reported a year earlier.
Exports to non-European Union countries rebounded by 12.8 per cent in
February, after a fall in January, but UK exports to the EU tumbled by 4.7
per cent.
Factory inflation: Producer output prices, for goods leaving factory
gates, dropped sharply to an annual rate of 2 per cent during March, down
from 3 per cent in February and from 5 per cent late last year. Last month’s
figure was the lowest since July 2007.
Factory costs: Producer input prices, for manufacturers’ raw materials,
components and fuel, rose by 1 per cent during March, but their annual rate
of increase sank into negative territory after much larger rises a year ago,
dropping to minus 0.4 per cent, the lowest figure since August 2007.
German industry: Output from German factories fell by 2.9 per cent
during February, the sixth consecutive monthly fall. This decline left
industrial production down by by 23.2 per cent over a year, the steepest
annual decline seen since the country’s reunification in 1990.
US trade gap: America’s trade deficit plummeted by 28.3 per cent, its
sharpest fall for more than 12 years, as the slump in US consumer demand
undercut the country’s appetite for imports, while exports managed to grow.
The monthly trade gap of $26 billion (£17.7 billion) was the lowest since
late 1999 and was down by more than $10 billion from the revised $36.2
billion deficit in January, It also marked a record seven consecutive months
of decline.
Japan boost: The ruling party in Japan unveiled a plan for a record
$154 billion (£104 billion) economic stimulus worth 3 per cent of GDP to
combat the deepening recession in the world’s second-biggest economy.
Banking
& finance
Sumitomo Mitsui Financial Group: The Japanese megabank stunned markets
with a surprise profit warning that it had probably finished the 2008
financial year with a net loss of about £2.6 billion and provoked fears
about the stability of the country’s financial sector.
Wells Fargo: America’s fourth-largest bank said that it expected to
report a first-quarter profit of $3 billion (£2.04 billion), giving hope
that lenders engaged in traditional banking activities may handle the
recession better than analysts had expected.
Hypo Real Estate: The German Government announced an offer to take over
the stricken commercial property lender. It would be the first German bank
nationalisation in the post-war era.
Barclays: Bob Diamond, president of the banking group, could pocket as
much as £4.7 million after it agreed the sale of its iShares asset
management unit to CVC Partners, the private equity group, for $4.4 billion
(£3 billion). Shares in Barclays rose by 12.5 per cent.
Construction
& property
Canary Wharf Group: The operator of London’s second-biggest financial
hub has cut its long-term debt costs by about £84 million, after buying back
£120 million of mortgage securities at discounts.
British Land: The property investment group is in talks to sell half of
its £2.5 billion Broadgate London office estate to MGPA, the Australian fund
manager, as part of its efforts to consolidate its cash position after a
rights issue in February.
Costain: The Berkshire construction company said that it has been
awarded a £397 million contract by Viridor Laing to design and build
municipal waste treatment infrastructure in Greater Manchester as part of a
Private Finance Initiative agreement.
Consumer
goods
Cosentino Signature Wines: Fears were growing over the future of the
upmarket Napa Valley wine producer after it admitted that it had been forced
to seek new financing after its American lender had declined to refinance
its $18 million (£12.3 million) debt facility.
Kirin: A contract allowing the Japanese drinks group to distribute
products made by Pernod Ricard, the French wine and spirits company, in
Japan has been cancelled. This will enable Kirin to sell its 3.74 per cent
stake in Pernod Ricard. Starting in October, Pernod Ricard will distribute
its Chivas Regal Scotch whisky and other products through its Japanese
subsidiary.
Engineering
Beneteau: The French shipbuilder, which specialises in sailing boats,
said it planned to cut nearly 600 jobs to stay afloat during the economic
crisis. The company, which employs 4,000 people in France, said sales of
sailing boats and yachts had dropped by 50 per cent as the downturn hit the
recreation industry.
Tata Motors: The Nano, the world’s cheapest car has gone on sale for
$2,000 (£1,364), with the Indian carmaker saying it was confident of strong
demand despite a slump in global car sales.
Toyota: The American division of the Japanese carmaker is bringing
Yoshi Inaba, a former top executive, out of retirement as it responds to the
downturn in its biggest market.
China Association of Automobile Manufacturers: The industry body said
that the Chinese had bought a total of 1.1 million vehicles during March, up
by 5 per cent from the previous record of 1.06 million in March last year
and making the country the world’s largest car market, outstripping the
United States.
Health
AstraZeneca: The Anglo- Swedish pharmaceuticals group said that it had
won partial support for its bid to expand the approved uses of Seroquel XR,
its blockbuster schizophrenia treatment. A committee of US Food and Drug
Administration advisers said that Seroquel XR was safe enough for treating
some patients with depression but they opposed the use of the drug for
patients dealing with anxiety.
Industrials
HeidelbergCement: The German cement maker is drawing closer to a deal
with its banks to fill a €6 billion (£5.4 billion) refinancing hole,
according to reports. The company is part of the heavily indebted empire of
Adolf Merckle, the late German billionaire, and has to repay a €5 billion
bond in the middle of next year as well as other debts.
Norman Hay: The West Midlands chemicals and sealants group reported a
4.3 per cent rise in full-year pre-tax profits to £2.4 million, but added
that economic weakness in its main markets had significantly affected
trading in the first quarter of this year.
Leisure
JD Wetherspoon: The pub operator has dropped the controversial
99p-a-pint deal launched in January in a blaze of publicity. In its latest
price list, the price of a pint of Ruddles ale has risen from 99p to £1.29.
Stanleybet International: The British sports betting company, which
operates a number of shops in the earthquake-hit Italian city of L’Aquila,
has made a €1 million (£901,000) contribution to the fundraising efforts for
those affected by the disaster.
Hebridean International Cruises: The operator of the Hebridean
Princess, the cruise liner that tours the highlands and islands of Scotland,
has called in administrators from Ernst & Young, who have already
fielded interest from potential buyers.
Manchester United: The Premier League football club said that it has
increased its full-year sales by 22 per cent to £256.2 million, a record for
a British football club. This means pre-tax profits at Red Football Limited,
United’s immediate parent, rose by 29 per cent to £24.1 million.
Media
ABC: The media research group said total average daily newspaper
circulation in Britain during the six months from October 2008 to March 2009
had fallen by 5 per cent to 2.54 million, down from 2.68 million a year ago.
The Local Radio Company: The London-listed group said its Trinity FM
unit had sold the Jazz FM brand to Jazz Investments, a consortium headed by
Richard Wheatly, Local Radio’s former chairman, for £1 and the assumption of
Trinity’s liability of £195,510 to GMG Radio Holdings.
Natural
resources
Gazprom: The Russian gas export monopoly said it believes that global
demand and its own gas production will be depressed by about 10 per cent for
the next four to five years. The company, which supplies a quarter of
Europe’s gas demand, said that it would produce 492 billion cubic metres of
gas this year, down by 12 per cent from the original planned output and down
by 10 per cent from last year.
Retailing
John Lewis: The department store chain said that sales during the week
to April 4 had fallen by 6.7 per cent to £45.4 million compared with last
year — hit by the late Easter.
Wal-Mart: Same-store US sales at the world’s largest retailer rose by
1.4 per cent during March, falling short of the 3.2 per cent rise which had
been expected by analysts. However, Asda, the British supermarket group
owned by Wal-Mart, reported strong like-for-like sales. The core grocery and
fresh meat categories led food sales, while general merchandise sales grew
fastest in pet care and gardening.
Support
Services
Hays: The recruitment group said that it had cut 250 more of its own UK
workforce to cope with the deteriorating demand for permanent staff, and
added that third-quarter net fees from UK recruitment were down by 37 per
cent compared with last year. Britain and Australia are the company’s
largest markets and the unemployment rate in Australia has now hit 5.7 per
cent — the highest level since 1991.
Helphire: The accident management group, based in Bath, said that it
plans to raise £50 million through a share placing and open offer to enable
it to improve profitability and cash generation.
Technology
Cisco Systems: The American network equipment maker announced that it
was buying Tidal Software, the privately held group, for $105 million (£71.6
million) in a move that is aimed at enhancing Cisco’s next-generation data
centres.
Autonomy Corporation: The software group, based in Cambridge, said it
expects to report record first-quarter revenues of between $128 million and
$130 million, ahead of analysts’ estimates. It added that earnings per share
are expected to be “significantly” ahead of market predictions.
Telecoms
Comstar: The Russian fixed-line telecoms operator which is owned by
Sistema, the Moscow conglomerate, has reported fourth-quarter net profits of
$59.2 million (£40.4 million), up from $51.8 million last time and beating
forecasts of $43.6 million.
Vodafone: The mobile phone group, based in Berkshire, said it has
dropped Goldman Sachs and UBS as its corporate brokers, severing of one of
the longest-running and best-known advisory relationships in the City.
BT: The telecoms group is cutting the rate it pays contractors by
between 10 and 30 per cent in a bid to shore up costs. It has already made
6,000 contractors redundant as part of its plan to cut 10,000 jobs and
announced a pay freeze for 100,000 staff.
Transport
British Airways: The merger of British Airways and Iberia, the Spanish
flag carrier, may be delayed until the summer as the two sides continue to
haggle over the terms of the deal. Separately, British Airways has once
again been voted the UK’s most trusted airline in an annual survey by
Reader’s Digest magazine, comfortably beating Virgin Atlantic for the top
spot.
Airline price-fixing: The US Government said that three international
airlines — Nippon Cargo Airlines of Japan, South Korea’s Asiana Airlines and
the Luxembourg-based Cargolux Airlines International — have agreed to pay
fines for their roles in a cargo price-fixing scheme.
Utilities
Russian state utilities: The Russian Government has trimmed 300 billion
roubles (£6.1 billion) from its state utilities’ spending plans for 2009-11,
but warned them not to slacken the pace of construction lest they hurt
prospects for economic recovery.
