business headlines.
Asian markets fall for a third day
Stocks in Asia fell for a third day as financials and commodity companies suffered a sell-off. Sumitomo Mitsui Financial Group, Japan's third-biggest bank, fell 7.9 per cent after it announced plans to raise ¥400bn to boost its capital and Australia's Babcock & Brown dropped 19 per cent after saying it would cut jobs to avoid defaulting on its debts. The MSCI Asia Pacific Index was down 0.4 per cent, bucking the recovery in the US in the last hour of trading, which saw the Standard & Poor's Index closing up nearly one per cent. The FTSE 100 opened down a little over half a per cent.
Japan is proof that busted economies can come back 
Inflation falls sharply
The UK rate of inflation fell more than expected in October, as drops in food and petrol accelerated, reported the Independent. CPI fell to 4.5 per cent last month, down 0.7 per cent from the month before, which was a 16 year high of 5.2 per cent, while the RPI, which includes council tax and mortgage interest payments and is used to set pay claims, fell from five per cent to 4.2 per cent. The Office of National Statistics said that the lower oil price was "the main reason" for the fall and the slowdown in food price inflation "also contributed".
After the credit crunch what next for the world?
Barclays fails to halt revolt
Barclays is facing "renewed shareholder anger" in spite of its efforts to head off shareholder concerns over its raising of £7bn of new capital from the Middle East, reported the Financial Times. The bank announced a "limited retreat" on some parts of its plan to raise money from Qatar Holding and Sheikh Mansour Bin Zayed Al Nahyan, a member of the Abu Dhabi royal family. It is allowing investors to "claw back" £500m in high-yielding securities, waiving bonuses and putting the board up for re-election, but this has not assuaged dilution concerns.
Financial crisis is a mess of Brown's own making
Lloyds seeks HBOS vote
Shareholders in Lloyds TSB are expected to vote in favour of the takeover of HBOS today, reported the Times. Chancellor Alistair Darling issued a "last minute warning" that a rejection could prove "costly" and that access to the government's bail-out funds was not automatic, in a "clear threat" to the proposed rival bid from Sir Peter Burt and Sir George Mathewson. Shareholders in Lloyds TSB will vote at an extraordinary meeting in Glasgow today and HBOS investors will vote next month. The independent bid is not seen now as likely to succeed.
HBOS: Lloyds rides to the rescue
12,000 businesses lose insurance
At least 12,000 UK businesses have had insurance cover withdrawn over the past week as the credit crunch starts to "bite deep", reported the Financial Times. Britain's biggest credit insurer, Altradius, confirmed yesterday that it was taking back the insurance offered to the suppliers of these companies against non-payment of credit. One broker said the move was "unprecedented" and that as many as 20,000 companies may have been affected by the problem in the last two to three weeks. Fears are growing that the government may have to step in.
Credit crunch bail outs are a threat to democracy
US cash injections eclipse interest
The Federal Reserve's "record" injections of liquidity into the banking system, to resolve the financial crisis are risking "the eclipse of their benchmark interest rate" as the key indicator of monetary policy, said Bloomberg.com. The overnight lending rate has been driven to less then half the official one per cent target set last month, resulting in "quantitative easing" as liquidity becomes a better gauge of policy than interest rates. The risk is that banks fail to lend the excess capital to customers, "prolonging the credit freeze".
Economic woes pile into Obama's in-tray
...in brief..................
M&S to hold sale and Woolworths in crunch talks
Marks & Spencer is "turning to a tactic it has not used since the business was in the doldrums in 2004" by holding a one-day sale. In a sign of how difficult the retail environment is, it is to hold a one-day "20 per cent off" sale on Thursday, according to insiders…………
Citigroup has had to liquidate its Corporate Special Opportunities hedge fund, after it lost 53 per cent of its value last month, said the Financial Times. It is the ninth time recently that the bank has had to either close or rescue a fund and is "the latest setback" for chief executive Vikram Pandit…………
How Porsche took the hedge funds to the cleaners
Brewer InBev has completed its $52bn purchase of Anheuser-Busch, making it the world's biggest alcohol-producer and marking a rare significant deal to boot. The credit crunch forced both sides to agree to stringent conditions, which helped to secure the deal…………
Sumitomo Mitsui Financial Group, Japan's third-largest bank, said it was looking to raise ¥400bn and saw its shares drop nine per cent. Sumitomo joins rivals Mitsubishi UFJ and Mizuho who are planning to raise ¥900bn and ¥300bn respectively…………
George Davies, the designer behind Next and George at Asda brands is to retire as part-time chairman of Marks & Spencer's Per Una clothes range next month. The departure comes as a surprise and has led to a shake-up at the clothing side of the company…………
Troubled retailer Woolworths is in "crunch talks" to sell its retail business to restructuring specialist Hilco, said the Daily Telegraph. The news will "raise further fears" about the financial strength of the company amid worries over the key Christmas period…………
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