Stocks resumed their upward path, with the Standard & Poor's 500 Index rising one per cent in New York after better than expected economic figures. US durable goods orders and new home sales both surpassed analysts' expectations and helped push up the market. The positive momentum continued in Asia, with the MSCI Asia Pacific Index also rising one per cent for a 21 per cent gain since its five-year low on March 9th, technically a "bull market". In London the FTSE 100 Index was 0.60 per cent higher in early trading. Gordon Brown is "facing embarrassment" over his second fiscal stimulus plan after a failed bond auction, reported the Independent. The government's "increasingly limited room for manoeuvre" is becoming apparent after the Treasury's most recent attempt to raise money through an auction of bonds failed. Investors are increasingly concerned about the UK's level of debt, leading to the first failure for seven years. The Debt Management Office could not find buyers for the whole of a £1.75bn tranche of bonds. Legal & General "bowed to reality" yesterday and cut its dividend in two, after soured investments sent it to a £1.5bn annual loss, reported theIndependent. The insurer "slashed" its annual payout to 2.05p per share after being forced to double the reserves it sets aside to cover defaults on its corporate bond holdings. The decision to cut the dividend "for the first time in living memory", was not an easy one, according to Tim Breedon, the company's chief executive. L&G shares dropped 7.4 per cent to 39.7p. US Treasury Secretary Tim Geithner shocked global markets yesterday by revealing that he is "quite open" to Chinese proposals for a "global reserve currency", reported the Daily Telegraph. The dollar "plunged instantly" against a range of currencies, with currency experts expressing shock that the US authorities would even contemplate the dollar's replacement as cornerstone of the global currency markets. Although Geithner later qualified his remarks, "the seeds of doubt have been sown". The two heads of Royal Bank of Scotland's "highly profitable" commodities trading joint venture have quit ahead of a review of pay and bonuses, reported the Times. David Messer, the US-based chief executive has left the nationalised bank on the heels of ex-president Frank Gallipoli and sources close to the joint venture - RBS Sempra Commodities - say that "a number of traders" are planning to leave because RBS is expected to "clamp down" on remuneration at the operation. Romania yesterday became the third EU country to receive financial assistance after Hungary and Latvia, reported the Guardian. It was bailed out by the European Union, the IMF and the World Bank to the tune of €20bn, with the loan dependent on "severe cuts" in public spending and wages. Eastern European countries are in "economic freefall" as the crisis deepens in their export markets. Yesterday's rescue package saw the IMF put up €13bn, the EU €5bn the World Bank €1bn and other creditors another €1bn. IBM, which has the biggest workforce in the US technology sector, is "set to lay off 5,000 staff" in North America, reported the Financial Times. Sources close to the company confirmed the cuts, which will come from its 100,000 staff, amid problems due to "slower technology spending"............ US retail investors "poured" nearly $250bn into bank accounts in the first few months of this year, reported the Financial Times. The "flight to safety" saw bank savings deposits reach a record $4.34tr in the nine weeks to March 9th, rising more than during the whole of 2008............ JJB Sports has sold its chain of fitness clubs to Wigan Athletic chairman Dave Whelan and sacked its chief executive for "gross misconduct", reported the Daily Telegraph. Finance director David Madeley has also resigned, amid a "widespread shake-up" of the struggling sports giant............ Next is "refusing to cut prices" during the economic crisis, despite pre-tax profits falling 14 per cent to £428.8bn, reported the Times. Chief executive Simon Wolfson admitted that the company's position is "not the most comfortable" place to be but pledged not to slash prices............ An executive who has benefited from AIG's "controversial" bonus scheme has quit with a "public tirade", reported the Guardian. Jake DeSantis, an executive vice-president, objected to being "persecuted" by US politicians and said he would give away his $742,006 bonus............ The global economy may be "flirting with disaster" but the world's top hedge fund managers are still bringing home the bacon, reported theGuardian. 11 of the world's top managers took home a combined $10bn last year, with Jim Simons of Renaissance Technologies top of the pile with $2.5bn............ .....business headlines.... headlines.........
Markets regain upward momentum
Geithner's toxic assets buy out sends stocks soaring 
Brown on defensive over stimulus
Mervyn King and Gordon Brown at odds over the recession
Daniel Hannan mugs Brown in Strasbourg Legal & General slashes dividend
Agent Provocateur defies the credit crunch US backs world currency idea
After the credit crunch, what next for the world? RBS braced for staff exodus
People: vandals attack Fred Goodwin's home Romania latest to get bail-out
Travel: The Romanian wetlands ...in brief..................
IBM slashes workforce and hedge fund managers prosper in crisis
Thursday 26 March 2009
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