Welcome to today's round-up of business news from The Times: what we're
saying, what they're saying
Top stories
The Times: The British taxpayer may
have to pay almost £900 million ($1.56 billion) for London's Olympic
Games while two of the main Olympic Park venues may have to be nationalised.
New York Times: After tussling over whether to revamp the regulatory
framework for global finance, US President Bush and European leaders have
agreed to a series of international
meetings to address the economic crisis.
The Times: While refusing to use the word recession, Lord Mandelson,
the new Business Secretary, admits Britain's economy is going
into reverse .
Comment
Anatole Kaletsky in The Times: Is it now too late to prevent the chaos
that suddenly engulfed the financial system this month spreading to rest of
the economy? Probably not, but radical
action is extremely urgent.
Nelson Schwartz in New York Times: Americans often dismiss Europe as a
place for languorous meals and vacations, not economic innovation. That
thinking is now under challenge as over the past 10 days Europeans have
proved more nimble than Americans.
Ambrose Evans-Pritchard in Daily Telegraph: With the commodity and
emerging market booms breaking in unison, do our rulers know
enough to avoid a 1930s replay?
Upside
Daily Telegraph: British house prices are close
to affordable levels , according to research by an economic consultancy,
however, households should not expect prices to bounce back as fast as they
did in the past.
The Independent: Sunseeker, the UK luxury yacht builder, says orders
from Russia and the Middle East are behind a record
turnover for the year.
Daily Telegraph: Aviva, the UK's largest insurer, has reassured
worried policyholders about a promised £1 billion ($1.74 billion) payout.
Downside
The Times: E.ON, British Energy and BizzEnergy, some of Britain's biggest
energy suppliers, have stopped bidding
for new power contracts with industrial customers.
Bloomberg: Groupe Caisse d'Epargne, the French customer-owned bank that
announced a €600 million (£466 million, $807 million) trading loss, has
replaced its chairman and chief executive officer.
Daily Telegraph: Consumer spending, one of the main drivers of the
Gordon Brown decade of boom, will not
recover until 2011 , according to an influential report.
Mergers and shakers
The Times: Prudential, Britain's second-largest insurer, is considering
selling a 20 per cent stake to a sovereign wealth fund to bankroll a
bid for part of AIG, its stricken American rival.
Financial Times: Oleg Deripaska, Russia's richest man on paper, is running
out of time to secure more than $2 billion (£1.15 billion) in financing
or hand over a 25 per cent stake in the world's biggest nickel miner.
The Times: Cable & Wireless, the telecoms provider, has postponed
plans for a demerger until next year because of the turmoil in
financial markets.
Around Asia
The Times: A $130 billion (£75 billion) guarantee by South Korea to win
back market confidence may not be enough
to stave off a crisis called Kiko.
Reuters: OPEC oil producers could
cut oil supplies in two rounds, one when they meet next week in Vienna
and a second later on, to firm up prices.
Financial Times: Indicators are hinting China is on
the verge of slump with third-quarter gross domestic product figures to
be announced today.
Look ahead
The Times: The Dutch Government will
inject €10 billion (£7.8 billion) of fresh capital into ING, the Dutch
savings bank with more than a million British customers.
The Times: Banks are braced
for tomorrow's deadline for insurers of Lehman Brothers' debt to pay up on
billions of dollars of policies with fears dozens of financial groups will
go under.
Daily Telegraph: Marks & Spencer, the retailer, will
cut dozens of head office jobs after deciding to scale back its
ambitious store expansion and refurbishment program.
Unfinished business - last week wrapped up
Last Monday
World stock markets soared in their
biggest one-day advance for 19 years as countries across four continents
bailed out stricken banks.
President Bush announces Washington will use $250 billion (£143 billion) of
its $700 billion (£400 billion) rescue fund to seize
stakes in nine of the US's biggest banks.
Tuesday
Almost 10,000 jobs will be lost in
the public sector with £900 million ($1.56 billion) to be saved at the
Ministry of Justice in the next two years.
The US Treasury uses $100 billion (£57.5 billion) of taxpayers' money to buy
preference shares in nine banks in
the White House's rescue strategy.
Wednesday
In an effort to keep the bailout on track, the Treasury prepares to relax an
implicit five-year ban on newly nationalised banks paying
dividends .
Ben Bernanke, the Federal Reserve chairman, warns that the American economy
is headed toward an extended period of
difficulty , despite worldwide efforts to stabilise the financial
markets.
Thursday
Google, the world's biggest internet company, defies the financial crunch to grow
profits by 26 per cent in the third quarter.
Prime Minister Gordon Brown risks an angry reaction from fuel and energy
suppliers after demanding garages slash
petrol and diesel prices .
Friday
Consumer confidence suffered its steepest
monthly drop on record in October and construction starts on new homes
fell to a 17-year low the previous month.
The International Monetary Fund is
investigating whether its chief Dominique Strauss-Kahn abused his power
in an affair with a subordinate who has since left.
MARKETS
FTSE 100 4,063.0 up 5.2% (Friday close)
Dow 8,852.22 down 1.4% (close)
S&P 500 940.55 down 0.6% (close)
Nasdaq 1,711.29 down 0.4% (close)
Nikkei 8,739.70 up 0.5% (latest)
Hang Seng 14,877.69 up 2.2% (latest)
Currencies
Sterling $1.7314/1.2877 euros (latest)
Euro $1.3446 (latest)
Commodities
Brent crude $70.55 up 95 cents (latest)
West Texas crude $72.80 up 95 cents (latest)
Gold $796.20 up $8.50 (latest)
New York
Reuters: US stocks fell on
Friday after weak housing and consumer confidence reports added to growing
worries about a widening slowdown, while oil prices rose on growing
expectations OPEC will cut crude supplies. Trading was volatile on Wall
Street and other financial markets as a wave of forced selling pushed
security prices wildly up and down in what has become a daily occurrence.
The US dollar rebounded against the yen in signs of greater risk appetite
but gold dropped after the dollar rally triggered heavy liquidations by
commodity funds. The Dow capped its best weekly gain in five years and the
broader S&P 500 had its best week since February after a disastrous three
weeks that had knocked US stocks deeply into bear territory. Stocks had
risen solidly earlier on reassuring results by technology leaders Google
and IBM, as well as bargain-hunting. There were more advancing shares
than declining shares on the New York Stock Exchange, but among the 25 most
active, decliners outnumbered advancing stocks by two to one.
Asia
Bloomberg: Asian stocks
advanced, led by financial companies, as government efforts to bolster
financial markets lowered banks' borrowing costs. Shinhan, South
Korea's second-largest financial company, rose 4.3 per cent, snapping a
three-day slump. Shinhan jumped 4.3 per cent while Woori Finance Holdings,
which control's South Korea's second-largest bank, advanced 3 per cent and
KB Financial, the holding company for Kookmin Bank, added 2.9 per cent. BHP
Billiton, Australia's biggest oil producer, climbed 5.9 per cent, the
first gain in four days, on speculation that OPEC will reduce output targets
at its meeting this week to support prices. Woodside Petroleum,
Australia's No. 2 oil producer, jumped 4.2 per cent as Marubeni, a Japanese
trading house that generates more than a quarter of its revenue from energy,
climbed 3.6 per cent. Panasonic jumped 6.7 per cent after the Nikkei
newspaper said profit would exceed the company's estimate. The MSCI Asia
Pacific Index rose 0.9 per cent to 88.11 in morning trade.
Myles McIvor
mjclub@bigpond.com.au
AGENDA
TRADING STATEMENTS
Senior
OTHER
Rightmove House Price Index
Council of Mortgage Lenders' gross lending estimate
London Retail Sales Monitor, 9.30am
Public Sector Finances - September
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