Welcome to today's round-up of business news from The Times: what we're
saying, what they're saying from Paul Larter paul.larter@thetimes.co.uk
Top stories
The Times: Bradford & Bingley's largest shareholders were forced
to rescue the bank's capital-raising effort as TPG, the private equity
group, pulled out of a £179 million deal.
Financial Times: Eurozone interest rates hit
a seven-year high but markets were relieved by a less hawkish tone from
Europe's central bank, which damped fears of further rises.
Bloomberg: Origin Energy, Australia's biggest producer of coal-seam
gas, said that BG Group's A$13.8 billion (£6.7 billion) hostile takeover bid undervalues
the company.
Comment
David Wighton in The Times: Until house prices find a floor, the credit
system and the wider economy will continue
to flounder.
Lex in Financial Times: By limiting the scope to manage market risk the
crusade against 'speculators' could increase the world's dependence on
important oil producers.
Jeff Randall in The Daily Telegraph: Mark Thompson once admitted the
BBC was wallowing in a "Jacuzzi of cash". The problem is that it
tries to do too much.
Upside
Financial Times: BHP Billiton, the Australian mining company, said the
US antitrust authorities had largely
cleared its proposed $170 billion acquisition of rival Rio Tinto.
BBC: The price of oil has continued to climb with US light, sweet crude
reaching a record closing price and
London Brent rising above $146 a barrel.
The Times: Britain's four largest law firms each
earned more than £1 billion last year, confirming London's emergence as
the centre of the global legal services market.
Downside
The Times: British Airways flights are taking off with almost a quarter
of their seats empty as higher air
fares and a slowing economy led to a 87,000 drop in passengers last month.
Reuters: Phillip Bennett, the former chief executive of Refco, was
sentenced to 16 years in prison for
fleecing investors of more than $2.4 billion (£1.2 billion).
The Wall Street Journal: US nonfarm payrolls shrank
for a sixth consecutive month, down 62,000 jobs in June, as
retrenchments followed rising costs and a weak economy.
Mergers and shakers
The Times: Barratt Developments told staff that it would make about 1,000
people redundant, taking job losses in the construction industry to
nearly 2,300 in just two days.
Reuters: A US judge's order to Google to turn over YouTube user data to
Viacom sparked an outcry from
privacy advocates.
BBC: Vodafone, the mobile phone firm, is to expand
its presence in Africa by buying a controlling stake in Ghana Telecom
for £452 million.
Around Asia
The Times: Steiff, fed up with China's poor workmanship, high staff
turnover, delays and shipping costs, is moving
bear production back to its birthplace in Germany.
Financial Times: Chinese spending
on technical consumer equipment is set to overtake that of western Europe
some time in 2009-2010, according to a report released on Friday.
The Nikkei: Japan's finance minister voiced concerns that inflation and
the global economic slowdown are making it harder for advanced countries to
steer economic policies.
Coming up
New York Post: Blockbuster, which abandoned its offer to buy Circuit
City Stores this week, may try to
acquire the electronics retailer later, insiders say.
The Times: Baugur will this week
sell the Icelandic supermarket business that formed the foundation of
its European retail empire when it confirms plans to relocate to the UK.
The Daily Telegraph: European Union politicians are considering an obscure
treaty article to curb financial speculation, in an attempt to force
down oil and food prices.
MARKETS
FTSE 100 5,476.60 up 0.9% (Thursday close)
Dow 11,288.54 up 0.7% (close)
S&P 500 1,262.90 up 0.1% (close)
Nasdaq 2,245.38 down 0.3% (close)
Nikkei 13,192.07 down 0.6% (latest)
Hang Seng 21,454.63 up 1% (latest)
CURRENCIES
Sterling $1.9841/1.2623 euros (latest)
Euro 1.5718 (latest)
COMMODITIES
West Texas crude $145.32 up 3 cents (latest)
Gold $937.30 up $3.70 (latest)
New York
Bloomberg: Most US stocks
fell, completing the longest streak of weekly declines in four years. A
reduced sales forecast by Nvidia, the second-biggest maker of
computer-graphics chips, outweighed speculation the Federal Reserve will
hold off raising interest rates. Freddie Mac tumbled but General Electric
and General Motors advanced.
Asia
Bloomberg: Asian stocks fell,
sending the region's benchmark index lower for a fourth week, as record oil
and slowing growth dent profits. Japan's Nikkei 225 Stock Average had
declined for a twelfth day - down 0.3 per cent - the longest losing streak
in 54 years. The MSCI Asia-Pacific Index was down 0.1 per cent in intraday
trading.
Paul Larter
paul.larter@thetimes.co.uk
London
Far from letting their fingers do the walking to sort out their £3.8 billion
debt, managers of Yellow Pages publisher Yell have been keeping them
crossed, one broker said yesterday.
The company has consistently refused to reveal details of its bank covenants
but John Davis, the finance director, has let slip to analysts that if
underlying earnings remain steady in the next financial year from April 2009
he will have to talk to the banks. He also said that if earnings are flat in
the current year Yell is only 5 per cent away from a breach.
Paul Gooden, analyst for ABN Amro, said: “There is a material risk of a
covenant breach next year.” Yell shares gained 1.25p to 61.75p, valuing it
at £482.3 million compared with its £3.8 billion debt as Mr Gooden said that
the banks would probably insist on a rights issue before they agreed to
refinance £3.8 billion debt. He suggests a five for two rights issue at 39p
would raise £760 million.
The FTSE 100 gained 50.3 points to 5,476.6 on a rollercoaster day rising as
high as 5,490.6 and falling as low as 5,358.5 as the index’s usual prop –
miners and oils – went up and down on speculation that the commodities boom
was finally over. There were worries that steel demand has passed a peak as
the car industry goes into reverse, meaning that the price of steel’s raw
materials, iron ore, coking coal and ferrochrome, could also dive. Coal for
European delivery experienced a sharp sell-off on Wednesday.
J Sainsbury lost another 10p to 280p after Marks & Spencer’s
warning. It too has been losing food market share in recent weeks.
Robert Lindsay
robert.lindsay@thetimes.co.uk
AGENDA
INTERIMS
None scheduled
FINALS
O Twelve Estates
Polar Capital Holdings
AGMs
Shires Income
EGMs
None scheduled
TRADING STATEMENT
Caledonia Investments
ECONOMICS
No UK data scheduled
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