Welcome to today's round-up of business news from The Times: what we're
saying, what they're saying, what you should be thinking
Top of the home pages
The Times: Borrowers will be allowed to stop
repaying debts by taking out a court order, under radical plans outlined
by the Government.
Financial Times: European regulators
raided some of the biggest pharmaceutical companies in an inquiry into
whether they conspired to keep up the price of drugs after patents expired.
The Independent: A personal finance scandal is brewing as thousands of
customers are seeking, and winning, refunds
of premiums for payment protection insurance.
From the commentators
Anatole Kaletsky in The Times: Something must be done to ensure that
banks, their employees and their shareholders pay an adequate
price for the implicit insurance they enjoy from governments and
taxpayers.
Lex in Financial Times: Selecting
defensive stocks means abandoning the bad analytical habits that have
prospered over the past two years. Fans of buyout simulations, that means
you.
Tom Stevenson in The Daily Telegraph: Merrill
Lynch's survey of fund managers confirmed that institutional investors
are heading towards capitulation, that most terrifying market phase when
fear obliterates greed.
Good day
BBC: Iraq faces a period of
economic growth and political progress, according to assessments by the
International Monetary Fund and the UN.
The Wall Street Journal: An authoratitive study says new
oil projects will pick up the slack as output from the world's existing
oilfields declines at a rate of about 4.5 per cent a year.
The Daily Telegraph: Rio Tinto
has kept the pressure on its stalker, BHP Billiton, to increase the value of
its takeover offer with the announcement of its strongest annual production
levels.
Bad day
The Times: BP admitted that it
had fallen short of safety standards after the death of another worker at
its Texas City refinery this week.
The Wall Street Journal: The credit
crunch is starting to bite commercial projects, with the developer of a
Las Vegas casino defaulting on a $760 million (£390 million) loan from
Deutsche Bank.
The Times: Energy companies
were threatened with a windfall tax after Ofgem, the regulator, advised the
Treasury that suppliers will receive a £9 billion benefit from emissions
permits.
Mergers and shakers
The Wall Street Journal: JPMorgan
is "very open-minded" about acquisitions, its chief executive
said. The firm said mortgage-origination volume surged despite a 34 per cent
drop in profits.
The Times: Somerfield, the
grocery chain part-owned by the property tycoon Robert Tchenguiz, is up for
sale and could change hands for as much as £2.5 billion in an auction being
conducted by Citigroup.
The Daily Telegraph: Charles Denton,
former chief of the luxury soapmaker Molton Brown, is building a stake in
the troubled computer games group SCi and is considering a takeover bid.
Around Asia
Bloomberg: The yen rose against
the dollar and the euro after the US Federal Reserve and European Central
Bank said economic growth was slowing.
Financial Times: The US, the UK and other leading donors are demanding
an overhaul of staffing and oversight procedures at the Asian
Development Bank .
Bloomberg: All Nippon Airways,
scheduled to be the first recipient of Boeing's 787, and Japan Airlines may
seek compensation from the aircraft maker after a second delay in the
aircraft's delivery.
Coming up
Reuters: Ben Bernanke, chairman of the US Federal Reserve, is expected
in congressional testimony on Thursday to back
a growth package structured around business and consumer spending.
Financial Times: Gordon Brown ruled out letting Northern
Rock slide into administration, claiming it was "a route to a fire
sale of assets", as he prepares to make a final decision.
The Daily Telegraph: The Government is facing mounting pressure to
clarify its controversial plans to scrap
the 10 per cent rate of capital gains tax paid on business assets and
replace it with a flat rate of 18 per cent for all assets.
MARKETS
FTSE 100 5,942.90 down 1.4% (Wednesday close)
Dow 12,466.16 down 0.3% (close)
S&P 500 1,373.20 down 0.6% (close)
Nasdaq 2,394.59 down 1% (close)
Nikkei 13,622.95 up 0.9% (latest)
Hang Seng 24,358.90 down 0.4% (latest)
Sterling $1.9636 (latest)
West Texas crude $90.99 up 15 cents (latest)
Gold flat at $882.00 (latest)
New York
Reuters: US stocks fell after Intel
reported a disappointing profit and outlook, driving the S&P 500 to
its lowest closing level in 14 months. Investors also unloaded Apple
shares for a second day, after the maker of the iPod failed to inspire with
new products. The Dow Jones industrial average closed down 0.3 per cent, the
S&P 500 index was down 0.6 per cent and the Nasdaq dropped 1 per cent.
Asia
Bloomberg: Asian stocks
declined on concerns that China's economic growth will slow at the same time
as the US economy heads towards a recession. China Construction Bank,
the nation's second-largest bank, fell after the Government ordered lenders
to set aside more money in reserves. BHP Billiton dropped on
speculation that a slowdown in China will curb demand for raw materials. The
MSCI Asia Pacific index, a regional benchmark, was down 0.7 per cent, while
Japan’s Nikkei had risen 0.9 per cent in intraday trading.
Paul Larter
paul.larter@thetimes.co.uk
London
Talk of strategic investment from the Middle East helped British Airways
to buck the market sell off with a 12p gain to 289½p.
Goldman Sachs added fuel to the fire by declaring that BA offered “strategic
value at a distressed price for a Middle Eastern or Asian carrier backed by
sovereign wealth”.
The fall of 82.7 to 5942.9 in London’s leading index was triggered by fears
about bank write-offs and worries that a US recession would shrink metals
demand, which sent the copper price down and mining stocks into reverse.
Shares in the London Stock Exchange itself were down 97p to £16.14
after Alliance Bernstein initiated coverage with a £16 price target. It
warned of slowing growth in equity trade and growing competiton from the
likes of Nomura’s Chi-X.
Cable & Wireless lost 5.9p to 164½p after Morgan Stanley cut its
price target to 185p, saying that the way it accounted for its pension
surplus flattered its earnings.
Bear Stearns cut the insurance sector, pointing out that many big players had
high debt and heavy investments in residential and commercial property and
shares. Prudential fell 28p to 642p. Friends Provident, down
2.3p at 155½p, was its top sell for 2008 with the credit crunch making a
break-up or sale unlikely.
Banks fell further on a Goldman Sachs downgrade. HBOS lost 10p to 630p, HSBC
19p to 753½p, Lloyds TSB 11¾p to 753½p and Royal
Bank of Scotland 1p to 391p.
Vedanta Resources, owner of mines in Zambia, Australia and India, down
105p to £18.85, was eyeing a bid for First Quantum Minerals, down 180p at
£40.20, whose main asset is its Zambian copper mine. Vedanta chairman Anil
Agarwal said yesterday he was looking at acquiring mineral assets in Africa,
Latin America and South East Asia.
Robert Lindsay
robert.lindsay@thetimes.co.uk
AGENDA
INTERIMS
None scheduled
FINALS
Food & Drink Group
Wogen
AGMs
Amarin
Diploma
Enterprise Inns
Mediterranean Oil & Gas
EGMs
Norseman Gold
Redstone
TRADING STATEMENTS
Associated British Foods
Barratt Developments
Enterprise Inns
Food and Drink Group
HMV Group
Home Retail Group
Kesa Electricals
SABMiller
Smiths News
Tradus
Thorntons
ECONOMICS
BCC economic survey (0930 GMT)
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