Welcome to today's round-up of business news from The Times: what we're
saying, what they're saying
Top stories
The Times: Gordon Brown, the Prime Minister, admitted
Britain was entering a recession as the pound plunged to a five-year low
against the dollar and London shares plummeted.
The Times: Wachovia, the American banking group being rescued by Wells
Fargo, reported a quarterly loss of
$23.9 billion (£14.7 billion) with the takeover still on track for
Christmas.
The Times: The White House called a
summit of the world's key economies for November 15 as the global
financial crisis causes havoc from Budapest to Buenos Aires.
Comment
David Wighton in The Times: In his unremittingly gloomy speech about
the economy, Mervyn King kicked the pound
when it was down so it was no surprise that a good old-fashioned run on it
arrived.
Tom Stevenson in Daily Telegraph: Markets hate
uncertainty and see things in black and white. This is a problem because
they exist in a multi-coloured world in which the only constant is change.
Robert Skidelsky in The Times: John Maynard Keynes has been brought
back to life . It seemed that the great economist was history - just
like the Great Depression but recent events have proved him right.
Upside
Financial Times: Germany is preparing a package of economic
measures to support consumption and help selected industries as growth
in Europe's largest economy rapidly loses steam.
The Independent: Depository Trust and Clearing Corporation, the US
securities clearing house, and its European rival LCH.Clearnet have
combined to create the world's biggest clearing house in an effort to
cut trading costs.
Reuters: The quarterly earnings of defence contractors Northrop Grumman
and General Dynamics beat Wall Street
forecasts , showing few signs that US spending will slow.
Downside
The Times: The ban on short-selling delivered a heavy
blow to hedge funds as they suffered their worst month on record, losing
4.6 per cent in September.
New York Times: After investing more aggressively to narrow its
deficit, the US federal agency that guarantees pensions lost
$2.1 billion (£1.3 billion) on its investments so far this year.
The Times: The BBC pension scheme lost
£1 billion ($1.6 billion) in value in four months as a casualty of
sliding share markets.
Mergers and shakers
The Times: The Government broke its pledge to sell
the Tote after admitting market conditions made it impossible to secure
a good price for the bookmaker.
Daily Telegraph: Analysts say Jerry Yang, the Yahoo! co-founder, could
be ousted by activist US investor Carl Icahn, a 5 per cent owner, and
other board members.
New York Times: American International Group, the beleaguered insurer, suspended
payments to executives from a $600 million (£370 million) bonus fund as
well as $19 million (£11.7 million) in payments to its former chief
executive.
Around Asia
Bloomberg: According to insiders, Nissan Motor, Japan's third largest
carmaker, was not willing to put up
cash for an alliance with Cerberus Capital Management LP's Chrysler.
Financial Times: Haruhiko Kuroda, president of the Asian Development
Bank, said Asian growth would stay robust
next year despite the financial crisis and looming recession in Europe and
the US.
Bloomberg: Citic Pacific, the steelmaker and property unit of China's
largest state-owned investment company, has four times more money riding
on the Australian dollar than it earned last year.
Look ahead
The Times: Home Retail group, owner of Homebase and Argos, warned that
activity on the high street was continuing
to deteriorate after a £437 million ($710 million) pre-tax loss over the
latest six months.
Financial Times: ArcelorMittal, the world's biggest steel producer, is
reviewing its $35 billion (£21.5 billion) expansion program as it
prepares for weak growth.
Daily Telegraph: Retailers were facing
their worst Christmas for more than a decade according to a report by
Verdict, the retail research company.
MARKETS
FTSE 100 4,040.89 down 4.5% (Wednesday close)
Dow 8,519.21 down 5.7% (close)
S&P 500 896.78 down 6.1% (close)
Nasdaq 1,615.75 down 4.8% (close)
Nikkei 8,195.74 down 5.5% (latest)
Hang Seng 13,556.14 down 5% (latest)
Currencies
Sterling $1.6245/1.2671 euros (latest)
Euro $1.2821 (latest)
Commodities
Brent crude $65.25 up 73 cents (latest)
West Texas crude $67.45 up 70 cents (latest)
Gold $727 down $8.20 (latest)
New York
Reuters: Stocks tumbled to
five-year lows on Wednesday as investors grappled with an increasingly dire
outlook for the global economy following a raft of disappointing profits and
outlooks from major US companies. Plummeting commodity prices sent energy
and materials companies' shares sharply lower. Exxon Mobil was the
top drag on the Dow, down almost 10 per cent. Boeing fell 7.5 per
cent after the aircraft maker reported a steep drop in quarterly profit and
warned it might need to provide financing to some of its customers in 2009. AT&T
fell 7.6 per cent after the top US phone carrier posted a quarterly
profit below Wall Street's forecasts as it grappled with pressure on
wireless margins. SanDisk plunged 31.6 per cent after Samsung
Electronics ditched its $5.9 billion unsolicited bid for the flash memory
maker, citing SanDisk's deepening losses and uncertain outlook. But Apple
bucked the trend, gaining 5.9 per cent, a day after the iPod maker reported
a stronger-than-expected quarterly profit.
Asia
Bloomberg: Asian stocks slumped
in morning trade, sending the region's benchmark index to the lowest level
in four years. Japanese exports missed estimates and commodities prices
tumbled, deepening concern the global economy is headed for recession. Mazda
Motor plunged 15 per cent, the most since February 2000 as the yen
surged against the euro, cutting the value of overseas sales. Konica
Minolta, the world's second-largest maker of film used in liquid-crystal
displays, plunged by its daily limit of 13 per cent. Isuzu Motors,
Japan's third-biggest maker of commercial vehicles, dropped 13 per cent
after saying it may miss its full-year profit forecast. Korea Electric
Power slumped 7.9 per cent after forecasting an $881 million loss. BHP
Billiton and Rio Tinto Group fell more than 8 per cent as commodities
dropped to a four-year low and European regulators said a takeover of Rio by
BHP may break antitrust rules. The MSCI Asia Pacific Index lost 3.9 per cent
to 84.36 in morning trade.
Myles McIvor
mjclub@bigpond.com.au
London
ITV fell 10 per cent to a new low of 30p amid mounting fears that it
would have to axe its dividend to help to fill a big hole in its pension.
Nicholas Bell of Jefferies International initiated coverage with an
“underperform” and 30p price target warning that he did not believe that
shareholders had woken up to the true state of the pension shortfall.
Meanwhile the evidence for falling TV advertising spend grows. Credit Suisse
analysts report that Moneysupermarket, down 2.25p at 52.25p, “has been told
by its media buying agency that TV ad costs are likely to be 10 per cent
cheaper in 2009.”
WPP lost 9 per cent amid growing fears that advertisers were cutting
expenditure for the fourth quarter after a warning from Omnicom. It reports
on third-quarter trading next Thursday.
BSkyB lost 11 per cent after a survey showed 10 per cent of pay-TV
subscribers were planning to cancel next year. Traders are concerned that
switching off the analogue signal which begins late next year will driving
people to choose Freesat boxes over pay-TV subscriptions.
The FTSE lost 188.84 to 4040.89, driven down by global recession fears after BHP
Billiton echoed the recent warning of its bid target Rio Tinto by saying
that Chinese growth had stalled.
Robert Lindsay
robert.lindsay@thetimes.co.uk
AGENDA
INTERIMS
Abberycrest
Provident Financial
Stobart Group
FINALS
Eaglet Investment Trust
Gartmore Smaller Co's
AGMs
Alumasc Group
BHP Billiton
Go-Ahead Group
Haynes Publishing
Highams Systems Services Group
Thorntons
TRADING STATEMENTS
Cattles
DSG International
Go-Ahead
Informa
Sports Direct
William Hill
OTHERS
Anglo American Q3 output
Aquarius Platinum (Q1)
Cattles (Q3)
Colt Telecom (Q3)
Elan (Q3)
Legal and General (Q3)
NDS (Q1)
Subsea 7 (Q3)
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