Friday, 9 January 2009




BoE cuts rates to 315-year low

The Bank of England cut interest rates by 0.5 per cent to a 315-year low of 1.5 per cent yesterday, reported the Financial Times. While it said the cut was necessary as the world economy sees an "unusually sharp" downturn, it also emphasised that rate cuts alone "were not enough" to improve the state of the economy. As a result the government has indicated that it is to introduce another package intended to ease credit. HSBC, Lloyds and Nationwide said they would pass on the cut in full on their variable mortgages, while others are "reviewing" their rates.
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Markets fall on uncertain outlook

Markets in Asia were down today, with the MSCI Asia Pacific Index falling 0.3 per cent to 89.60. Auto and technology stocks were weak as profits declined on falling demand. In Tokyo Nissan shares retreated five per cent after it announced layoffs in the UK and Taiwan computer-maker Asustek slid seven per cent. Stocks in the US were mixed yesterday – the Standard & Poor’s 500 Index closed up 0.34 per cent, while the Dow Industrials Index fell 0.30 per cent. In London the FTSE 100 Index opened marginally lower.
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Foxtons future in doubt

The future of another of the UK's biggest brands was "hanging in the balance" last night as it emerged that high street estate agent Foxtons had breached lending agreements with its banks, said the Independent. Buyout firm BC Partners, which bought the company in May 2007 for £390m is "reluctant" to put any more money into the estate agent, after poor market conditions forced it into "crunch talks" with lenders including Bank of America and Mizuho. The company has suffered as transactions in London have "dried up".
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Russia rift with Ukraine nears end

The crisis between Russia and Ukraine which has disrupted gas supplies to Europe "seemed to be moving towards resolution" last night, reported the Financial Times. Russia agreed to the placement of international observers to monitor the transfer of Russian gas via Ukraine, according to the Czech EU presidency. Russia's prime minister, Vladimir Putin, said that it was a "condition" for European gas supplies being restarted, although there is no certainty amid continued criticism and counter-criticism between the two countries.
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Korea cuts rates to record low

The Bank of Korea cut its benchmark interest rate by half a percentage point to 2.5 per cent, a record low, reported Bloomberg.com. The central bank said that the economy was "deteriorating faster than expected", with consumer and export demand faltering. The reduction to 2.5 per cent is the fifth such cut since October and brings the total drop to 2.75 per cent since then. Recession in Korea now looks certain and in reaction the government pledged to provide 50tr Korean won (£24.5bn) in loans and guarantees to small businesses.

Clifford Chance in partner cash-call

Clifford Chance, the world's biggest law company, is asking its 400 equity partners for an average £100,000 each in an effort to raise £40m, reported the Daily Telegraph. The cash call, was approved yesterday and is "the most dramatic sign yet" of the difficult situation at leading law firms as they anticipate revenues declining sharply. The move came as the company announced that it was in talks that could lead to 80 redundancies, but called the capital-raising a "routine measure" to ensure it had enough cash to fund growth.

...in brief..................

Satyam future in doubt and Cathay Pacific loses $1bn

Satyam Computer Services "plunged" to a record low for a second low on concerns over the company's future, said Bloomberg.com. Shares in the outsourcing company fell a further 84 per cent on worries it may run out of money in the wake of its chairman's alleged fraud…………

The Madoff saga continues as details emerged that he allegedly ordered the UK arm of his company to transfer $150m to his US operations "just weeks" before his supposed confession, said the Financial Times. It is thought he wanted to distribute the funds to "selected employees, family and friends"…………
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John Lewis brought "seasonal cheer" to the high street today after revealing a 27.4 per cent "surge" in weekly sales, said the Times. The chain reported strong fashion and electricals and home technology sales and benefitted from its price-matching commitment…………

Russian oligarch Alexander Lebedev approached Daily Mail & General Trust with a view to buying the London Evening Standard, reported the Daily Telegraph. It has emerged that Lebedev, who has a stake in Russian newspaper Novaya Gazeta, had his approach rejected late last year…………
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The recession has claimed "another motorsport casualty", with the news that Kawasaki has pulled out of MotoGP to cut spending, reported the Guardian. The Japanese company had competed in the sport since 2003, with annual costs of around 4bn yen or $43.8m…………
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Cathay Pacific has admitted to paper losses of almost $1bn in connection with the airline's fuel hedging, reported the Independent. The policy "backfired" after falls in the oil price and although the company tried to put a gloss on the number its shares fell 7.6 per cent…………

Posted by Britannia Radio at 12:52