the main headlines..........Business
Global shares see further steep falls
Poor economic news in the US and Europe sent share prices tumbling in Tuesday's trading. Fresh concerns over US mortgage lenders Fannie Mae and Freddie Mac and evidence of mounting inflation in Germany confined investors to the sidelines, with the FTSE 100 falling 2.4 per cent and the Dow Jones Industrial down 1 per cent. Ex IMF chief Kenneth Rogoff warned of further credit problems in the US, leading to the likely collapse of "one of the big investment banks".
BAA forced to sell London airports
The Competition Commission today signalled a break-up of BAA's UK airports network after it recommended the company stop running two of its three London airports, Heathrow, Gatwick and Stansted, and either Edinburgh or Glasgow north of the border. Its initial report said that competition problems were affecting the service offered to both passengers and airlines. A final report is due at the end of the year.
Lehman shares continue collapse on results fear
Shares in Lehman Brothers continued to decline sharply on Tuesday, falling another 13 per cent on worry over third quarter writedowns. Shares in the investment bank are down 80 per cent this year so far after sub-prime losses amounting to $8bn, and in a report by JPMorgan Chase analysts speculated that the investment bank would post another $4bn in credit-related writedowns.
Hedge fund investors face huge losses on investments
After a difficult summer for hedge funds, investors are having to come to terms with poor performance, reports the Times. Monaco-based SRM, which was wrong-footed by its investment in Northern Rock last Autumn is said to have lost 85 per cent of its assets and many of its rivals are "nursing losses" for the year. With managers positioned for rising commodities prices, the recent reversal has been "badly burning" funds.
Credit crunch creates boom for discount retailers
In a bid to cut household bills shoppers are turning away from traditional supermarkets to cut-price chains for their daily essentials, reports market research group TNS Worldpanel. TNS says that sales at Aldi were up 19.8 per cent year on year in the 12 weeks to August 10th, while Lidl saw sales rise 12.3 per cent. Frozen food discounters experienced impressive growth too, with Iceland's 14.4 per cent increase their best for a number of years.
Bank of England split on interest rate decision
In the second split vote in as many months, Bank of England Monetary Policy Committee members disagreed on the direction of interest rates, reported Bloomberg.com. Minutes of the August 7th meeting show that while Governor Mervyn King and six other members voted for no change, Timothy Besley voted for an increase and David Blanchflower a cut to spur growth. While the economy is heading towards recession, rising inflation means officials are "struggling to agree on the best remedy".
...in brief..................
Silverjet enquiry and house prices set to fall further
The Serious Fraud Office is likely to launch an enquiry into the collapse of business-class airline Silverjet, reports the Daily Telegraph. The company collapsed shortly after a $100m loan from Abu Dhabi-based Viceroy Holdings failed to materialize............
Babcock & Brown is conducting a review after renewed falls in its share price. The Australian investment group is rumoured to be considering the future of its chairman and chief executive in the wake of a 23.5 per cent fall in its shares............
Crown Paints, the Lancashire-based rival to market leader Dulux, is to return to British ownership. The private equity buyout by investment fund Endless comes after owner Akzo Nobel's purchase of Dulux gave it ownership of both brands............
Alliance & Leicester's four executive directors stand to receive bonuses of up to 125 per cent of their salaries if they stay for a year after the bank is bought by Banco Santander. Santander has said it expects to cut £50m of costs as it merges A&L with existing business Abbey............
Shares in Hewlett-Packard were up over 4 per cent in late trading after the company delivered better than expected earnings results. The 26 per cent jump in notebook sales came as a result of new designs and demand from Europe and Asia, the company said............
Market analyst Datamonitor has warned that mortgage lending will fall nearly 20 per cent this year, dashing hopes of a revival in the housing market. The company says that high levels of debt will result in a "bleak" future of rising arrears and reposessions
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