Welcome to today's round-up of business news from The Times: what we're
saying, what they're saying
Top stories
The Times: Dire economic news drove the pound to 13-year
lows and convinced many that the Bank of England would cut rates by up
to 150 basis points.
Daily Telegraph: The boss of Iberia, the Spanish airline considering
merging with British Airways, was told of BA’s merger talks with Qantas only at
the last minute .
The Times: AAim, a £3 billion ($4.4 billion) property investment
company backed by HBOS and chaired by Sir David Frost, has gone
into administration .
Comment
David Wighton in The Times: Cutting interest rates will not help when
the mechanism that turns these cuts into a boost for the economy is
broken .
Damian Reece in the Daily Telegraph: Any British Airways-Qantas merger
looks increasingly unlikely , and
it may threaten BA’s proposed deal with Iberia.
Lex in the Financial Times: If things are as bad as the US auto giants
make them out to be, extending loans would be even
more wasteful than it seems.
Upside
The Times: Homeowners who are sacked or whose pay is cut can defer
their mortgage interest payments for up to two years under a Government
guarantee.
Daily Telegraph: Some staff at New Star Asset Management could
share £10 million ($15 million) in incentives under a rescue deal for
the stricken fund manager.
Reuters: Online retail spending rose
15 per cent on the all-important Monday after Thanksgiving from a year
earlier.
Downside
The Times: Nomura, the Japanese securities giant, will cut
1,000 City jobs after taking on the European business of Lehman
Brothers, the failed US investment bank.
Daily Telegraph: The Financial Times newspaper will ask staff to work
shorter weeks or apply for redundancy as it seeks to slash
costs .
New York Times: Harvard University’s $36.9 billion (£25 billion)
endowment fund lost 22 per cent of
its value in the past four months and could lose 30 per cent by June 30.
Mergers and shakers
The Times: Competition regulators will ask Mike Ashley, the billionaire
behind Sports Direct, to justify
his recent purchase of shares in rival JJB Sports.
Reuters: Panasonic reportedly raised
its buyout offer for rival electronics maker Sanyo by 8 per cent in the
hope of closing a deal this week.
The Times: France’s EDF offered
$4.5 billion (£3 billion) for half of US nuclear power generator
Constellation Energy, disrupting Warren Buffett’s bid for it.
Around Asia
Financial Times: China Investment Corp, the country’s sovereign wealth
fund, would stop investing in
Western financial institutions, its chairman said.
The Times: An Indian court ruled that Vodafone, the mobile phone giant, must
pay $2 billion (£1.4 billion) in capital gains tax and other firms
could face bills.
Bloomberg: Babcock & Brown, the Australian asset manager struggling to
stave off collapse, got a lifeline
with a A$150 million (£66 million, $98 million) loan.
Look ahead
The Times: ITV predicts that advertising could
fall by between 12 per cent and 18 per cent on its flagship television
channel in January.
Bloomberg: Boston’s State Street, the world’s largest money manager for
institutions, plans to cut 1,700
jobs by March.
Nikkei: Japan's industry-leading Nippon Oil and sixth-ranked Nippon
Mining Holdings will merge under a holding company by next autumn.
MARKETS
FTSE 100 4,169.96 up 1.1% (Wednesday close)
Dow 8,591.69 up 2.1% (close)
S&P 500 870.74 up 2.6% (close)
Nasdaq 1,492.38 up 2.9% (close)
Nikkei 7,932.32 down 0.9% (latest)
Hang Seng 13,730.86 up 1.1% (latest)
Currencies
Sterling $1.4776/1.1621 euros (latest)
Euro $1.2715 (latest)
Commodities
West Texas crude $46.55 down 24 cents (latest)
Gold $773.30 up $2.80 (latest)
New York
Bloomberg: US stocks rose for
a second day as a jump in online spending and a record increase in mortgage
applications lifted retailers and banks. Amazon.com, the world’s top
online retailer, rose 10 per cent. Among financial stocks, Morgan Stanley
rose 15 per cent, JPMorgan Chase rose 6 per cent, Citigroup
rose 8.3 per cent and Bank of America rose 7.1 per cent. Freeport-McMoRan
Copper & Gold, the US’s largest public copper miner, fell 17 per
cent after it cut production and suspended its dividend. SanDisk, the
world’s largest maker of digital camera memory cards, rose 25 per cent on
takeover talks. CIT Group, the largest US independent commercial
lender, rose more than 20 per cent for the second straight day as it moves
to become a bank holding company.
Asia
Bloomberg: Asian stocks fell
in morning trade after Japanese businesses cut investment at the fastest
pace in six years last quarter. China stocks surged after a report that the
Government may inject more funds into the nation's largest banks. Sumitomo
Mitsui Financial Group, Japan’s largest bank, fell 7 per cent, leading
declines among Japanese banks. Industrial & Commercial Bank of China
rose 3.4 per cent on speculation the country's sovereign wealth fund would
raise its holdings in the nation's three largest lenders. Australian
surf-wear maker Billabong fell 18 per cent on a gloomy profit
outlook. The MSCI Asia Pacific Index fell 0.5 per cent to 79.52 in morning
trade.
Michael Beh
michaelwbeh@gmail.com
London
Rio Tinto lost another 10 per cent as a broker warned that many of the miner’s
investors believed “muddling through” its debt repayments without a rights
issue was not an option.
A warning of a slowdown in London train commuter passenger numbers from Stagecoach
sent its shares down 17 per cent. Go-Ahead, thought to be the
next most exposed to City job losses, lost 13 per cent, FirstGroup
fell 8 per cent, National Express fell 9 per cent, and Arriva,
least exposed,lost 6 per cent.
The FTSE 100 rose 47.1 to 4,169.96 dragged up by a strong start to Wall Street.
Man Group, the hedge fund manager, was the top performer, up 7 per
cent, after its flagship futures fund AHL reported 5.8 per cent growth in
value over the past month.
AstraZeneca rose 5 per cent after good trial results from its
anti-inflammatory drug for arthritis sufferers.
Drax, the coal-fired power station, fell 5 per cent after Credit Suisse
cut its target price from 660p to 400p,saying long term $50 a barrel oil
prices would make its electricity look relatively expensive.
Robert Lindsay
robert.lindsay@thetimes.co.uk
AGENDA
INTERIMS
Samuel Heath
FINALS
Abacus
The Local Shopping REIT
Minorplanet Systems
Optos
Redhall
Western & Oriental
TRADING STATEMENT
Bellway
Wm Morrison (Q3 results)
EGMs
Prodesse
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