Economics
Mortgage approvals fell by 27 per cent in the year to September, the
British Bankers’ Association said, to 52,685, the smallest number of
approvals for any September since 2000. Approvals are the key measure of
activity in the property market and a decline is seen as an early indicator
of a slowdown in house prices.
Banking crisis Alistair Darling, the Chancellor, turned up the pressure
on the board of Northern Rock to secure a workable solution to its plight.
Mr Darling defended Britain’s system of financial regulation but conceded
there were “lessons to be learnt”, while criticising the Financial Services
Authority for failing to scrutinise Northern Rock more closely.
Bank of England lending to Northern Rock rose by £4.7 billion in the
week to Wednesday, taking the latter’s total borrowing from public funds to
£20.6 billion, the Bank’s balance sheet indicated. Separately, the Liberal
Democrats have challenged the Treasury to toughen lending conditions on
Northern Rock’s financial lifeline.
German business confidence Germany’s Ifo index of business confidence
fell to 103.9 in October, from 104.2 in September, in what analysts said was
still consistent with strong growth.
US new home sales rose by 4.8 per cent in September to 770,000.
However, analysts gave warning that the outlook remained bleak, as the
figures can be extremely volatile.
US durable goods orders fell by 1.7 per cent in September, after a 5.3
per cent drop in August. The figure was below market expectations, but was
driven by a big drop in defence orders following a strong two months for the
sector.
China’s economy rose by 11.5 per cent in the third quarter, from
a 12-year high of 11.9 per cent in the previous three months but still
putting China on track to overtake Germany to become the world’s
third-largest economy before the end of the year.
Banking
& finance
Resolution, the closed life fund consolidator, is in talks over whether
to accept a £5 billion conditional offer from Standard Life, the Scottish
insurer.
Aviva reported a 21 per cent rise in global life and pensions sales to
£22.9 billion for the nine months to September 30, beating consensus
forecasts of £22.7 billion.
Banco Santander, the Spanish bank that owns Abbey, said the UK bank had
made a net attributable profit of £613 million, up by 20 per cent, for the
nine months to September 30.
Revenue & Customs Businesses or individuals affected by errors at
Revenue & Customs will be able to sue for damages after a landmark
victory at the Court of Appeal for Neil Martin, the Cumbrian builder who was
almost bankrupted by Revenue errors.
Capital gains tax The Chancellor has given strong hints that he may
offer some concessions over his plans to scrap “taper relief” on capital
gains tax in favour of a single flat rate of 18 per cent for the levy.
Industrial and Commercial Bank of China, the country’s biggest lender,
is to buy 20 per cent of South Africa’s Standard Bank for $5.6 billion (£2.7
billion), the largest foreign acquisition by a Chinese commercial bank.
Construction
& property
Delek Global Real Estate, the AIM-listed owner of NCP car parks, has
pulled out of a £1.4 billion Swiss property deal blaming the “uncertainty in
the global commercial property market”.
Consumer
goods
Mattel, the world’s largest toymaker, is recalling 12,000 toys in
Britain, Ireland, the United States and Canada because of excessive levels
of lead paint found in the products, according to the European Commission.
It is Mattel’s fourth recall in the past few months.
Scottish & Newcastle, the brewing group, has rejected an indicative
720p-a-share offer from Carlsberg, the Danish brewer, and Heineken, its
Dutch rival, describing the offer as “unsolicited and derisory”.
Greene King, the Suffolk brewer, has launched a new ale, called St
Edmunds, that will be served with different heads, depending on regional
preferences.
Engineering
QinetiQ The Ministry of Defence said that it was reconsidering the
award of the second stage of a £16 billion contract to QinetiQ, the defence
group, because the group would not deliver on the expected efficiences.
Honda Motor, the Japanese carmaker, reported record half-year net
profits up by 38.1 per cent to $3.25 billion (£1.59 billion), compared with
$2.353 billion last time.
Daimler, the German carmaker, reported a third-quarter net loss of
€1.533 billion (£1.065 billion, compared with a € 868 million profit last
time. It booked a €2.6 billion cash charge relating to the sale of its 80
per cent stake in Chrysler, the American carmaker, in May.
Black & Decker, the US power tools manufacturer, said its
third-quarter earnings had fallen to $104.6 million, despite stronger sales,
from $125.1 million last time.
Health
Oxford Biomedia, the gene therapy company, said it was unaware of any
reason for the fall of its share price over the past month and was trying to
clear up confusions over TroVax, its cancer drug. The company said that the
treatment had not failed in any study.
Industrials
JFE Holdings, the Japanese steelmaker, reported a 16.5 per cent rise in
half-year pre-tax profits to 260.8 billion yen (£1.1 billion), thanks to
higher prices. JFE makes almost half its revenue through affiliates and
customers based in China, South Korea and Thailand.
Leisure
Southampton Leisure Holdings, the owner of Southampton Football Club,
said it is in talks with Sisu Capital about a possible investment, which
would be made through a placing of new shares at 40p per ordinary share,
valuing the company at £14 million.
Betfred, owner of the Done Bookmakers chain, is understood to be
considering a sale or private equity buyout as an alternative to its mooted
£600 million flotation.
PartyGaming, the internet gambling operator, reported a 24 per cent
increase in third-quarter revenues as big gains in casino and sports betting
more than offset a 3 per cent decline from poker.
Hilton Hotels Corporation has announced the completion of a $26 billion
(£12.7 billion) buyout by Blackstone, the American private equity group.
Boylesports, the Irish bookmaker, has ruled itself out of the bidding
to acquire 32Red’s Bet Direct internet operation, leaving Stan James as the
leading contender.
Media
Capital Radio has recovered from a disappointing fourth place in the
last quarter but still tails behind Global Radio’s Heart 106.2 and Emap’s
Magic 105.4, according to the latest radio audience figures. Capital, which
was once the favourite radio station in London, held third place with a
market share of 4.7 per cent.
Natural
resources
Royal Dutch Shell, the Anglo-Dutch oil company, said it would take
political issues into consideration before deciding to go ahead with a
proposed pipeline project in Iran. The company, along with Spain’s Repsol,
is planning to develop part of Iran’s South Pars gasfield despite political
objections from Washington.
Oil price Peter Voser, finance director of Royal Dutch Shell, blamed
speculators for driving the price of oil to record highs. He believed the
soaring oil prices were being driven by speculation and political tension,
not a lack of supply.
BP’s chief executive, Tony Hayward, sought to draw a line under
the most turbulent period in the British oil group’s history after agreeing
to fines of almost $400 million (£195 million) for the Texas refinery blast,
Alaskan oil pipeline leaks and price-fixing of propane contracts.
Retailing
Arcadia, the retail group which owns Topshop, the high street fashion
chain, reported full-year operating profits that were up by 1.6 per cent to
£293.3 million, and drew attention to the impact on retailers of the wet
summer weather. The company did not declare a dividend for the year.
J Sainsbury The Qatar Investment Authority, which has put in a £10.6
billion bid for J Sainsbury, the supermarket chain, lacks appropriate
transparency and accountability, according to new research into sovereign
wealth funds by the Peterson Institute for International Economics, a
Washington think-tank.
M and M Direct Steve Robinson, the former chief executive of Tesco
Direct, has been appointed chief executive of M and M Direct, the online
sportswear and fashion retailer, as management secured a £90 million buyout
of the business.
Support
services
Network Group Holdings, the specialist recruiter, said it had placed
nearly 600,000 shares at 26p each raising almost £155,000. This was
following an October 8 placement that had raised £2.9 million. The proceeds
will be put into general working capital for Network and its subsidiaries.
Technology
Sony, the Japanese consumer electronics group, reported a rise in its
second-quarter operating profits thanks to stronger sales of personal
computers and digital cameras and a weaker yen. The company reported
quarterly net profits of 73.7 billion yen (£315 million), up from 1.7
billion yen last time, despite a poor performance from its gaming sector.
Nintendo, the Japanese gaming company, reported first-half profits at a
record 420 billion yen, in line with analysts’ expectations and up from an
earlier estimate of Y370 billion. as its Wii and DS video game consoles
outsold Sony’s PlayStation 3.
Motorola, the Japanese wireless technology and mobile phone maker,
reported a 38 per cent drop in third-quarter profits, amid flagging mobile
phone sales, to $60 million (£29.3 million), from $968 million last time.
Telecoms
Ericsson, the Swedish mobile networks group, reported lower
third-quarter earnings in line with last week’s surprise profit warning,
with a net profit of SKr4 billion (£303 million), down by 36 per cent from a
year ago.
Transport
EasyJet, the low-cost airline, is paying £103 million to buy GB
Airways, the Gatwick-based airline and franchise partner of British Airways,
in a deal which will give it 34 new routes to Southern Europe and North
Africa. The deal will see British Airways end its franchise with GB.
Transport for London has handed the contract to run the capital’s
congestion charge to IBM, pushing out Capita, the outsourcing company that
has operated the scheme since its inception in 2003.
Utilities
Guardian Water Treatment PHSC, the environmental services company, said
that it had signed a heads of agreement to purchase Guardian Water
Treatment, which is based in Essex, for up to £2.15 million.
British Gas, the residential gas provider, has been criticised for poor
customer service in a review by Energywatch, the independent UK watchdog.
Nuclear Decommissioning Agency Clean-up work at defunct nuclear
reactors in the South of England will be halted amid funding problems at the
Nuclear Decommissioning Agency.
