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Tuesday Papers: Deal takes shape to avert US fiscal cliff

And nearly 36 bankers will be implicated in the alleged rigging of Libor interest rates when UBS settles with global regulators later this week.

Tuesday Papers: Deal takes shape to avert US fiscal cliff

Top stories

  • Financial Times: The shape of a deal to avert the US fiscal cliff is at last emerging, with at least $1 trillion in new taxes, up to $1 trillion in fresh spending cuts and an increase in America’s debt ceiling, as negotiators scramble to reach an agreement before the end-of-the-year deadline.
  • Financial Times: About three dozen bankers and senior managers will be implicated in the alleged rigging of Libor interest rates when UBS settles with global regulators later this week, according to people familiar with the matter.
  • Financial Times: Morgan Stanley was fined $5 million by the Massachusetts securities regulator, which said the company’s investment bankers had “improper influence” on the research analysts who covered Facebook at the time of its initial public offering.
  • Financial Times: Carlos Slim, the world’s richest man, has overseen a loss of close to €2 billion on his foray this year into the European market after investments in two of the region’s largest telecoms groups - Holland’s KPN and Telekom Austria - slumped in value.
  • The Guardian: Fallen Icelandic retail tycoon Jon Asgeir Johannesson, once one of the most powerful tycoons on the UK high street, has been charged in Reykjavik with criminal offences relating to allegations he exerted improper influence on the failed Icelandic bank that financed much of his business empire.
  • The Daily Telegraph: Norilsk Nickel said Roman Abramovich will get a 20% voting stake and named co-owner Vladimir Potanin as chief executive in a peace deal to end a feud at the world's top nickel producer.
  • The Independent: It emerged that Instagram chief executive, Kevin Systrom, verbally agreed to sell to Twitter for $525 million in March but then called off the deal.
  • Financial Times: Wall Street’s debate over how to value Apple has intensified with the iPhone maker’s stock skirting around the $500 mark on Monday.
  • Financial Times: Former hedge fund managers Anthony Chiasson, co-founder of Level Global, and Todd Newman, a former portfolio manager with Diamondback Capital, were convicted on 10 counts of conspiracy and securities fraud for trading shares of Dell and Nvidia after receiving secret information about the companies’ earnings through a “circle of friends”.
  • The Guardian: The UK Department of Energy and Climate Change has approved the £1 billion Western Isles project, which will develop the Harris and Barra oilfields in the Northern North Sea, 99 miles east of the Shetlands and seven miles west of the mature Tern field.
  • Financial Times: The US credit union regulator has sued JP Morgan Chase over $3.6 billion worth of “faulty” mortgage securities created by Bear Stearns at the height of the housing boom.
  • Financial Times: Allianz has been fined $12.3 million by the US Securities and Exchange Commission after being charged with making improper commission payments over seven years to win insurance business in Indonesia.
  • The Guardian: Google is this week expected to escape the biggest anti-trust investigation for more than a decade by agreeing with US regulators to tweak the way it displays searches.
  • Financial Times: Twitter is linking with media measurement company Nielsen to create a television ratings system based on the chatter that TV shows spark on the microblogging site.
  • Daily Express: HMV's battle for survival in the face of dwindling demand for CDs and DVDs could lead to Apollo Global Management, a US private equity group, seizing control of the ailing entertainment retailer.
  • Financial Times: Tesco is moving closer to appointing a UK chief executive, with Chris Bush, chief operating officer, emerging as the frontrunner for the role.
  • The Daily Telegraph: Around 200 new British jobs will be created by GE Oil & Gas next year when it opens a "sub-sea" centre in Bristol.
  • Financial Times: Unsecured creditors to Comet, primarily landlords, stand to lose more than £200 million from the collapse of the electricals chain.
  • Financial Times: Banco Santander is to absorb its subsidiary Banesto into its main domestic bank in a deal that will close 700 branches as Spain’s largest lender by assets cuts costs.

Business and economics

  • Financial Times: Argentina’s government took the first step towards forcibly breaking up London-listed media group, Clarín, under an anti-monopoly law, but the newspaper-to-internet group slammed the step as “totally inadmissible and illegal”.
  • The Daily Telegraph: Edmund Truell, the entrepreneur founder of the Pension Corporation, has been appointed by the Mayor of London to head the capital's £4.2 billion local authority pension fund.
  • Financial Times: A JP Morgan-backed investment vehicle that aims to track the price of copper has won the approval of US regulators in spite of strong opposition from users of the metal and senior politicians.
  • The Daily Telegraph: British Parliamentary Banking Commission will this week call for banks to be broken up, rather than just ring-fenced.
  • The Independent: The yen plunged to 84.48 against the US dollar on Sunday as traders bet on a huge expansion in money printing from Japan's central bank in the wake of a landslide election victory for the Liberal Democratic Party.
  • Financial Times: After three years of topping the global rankings for initial public offerings, Hong Kong, this year, fell to fourth place, only narrowly beating Kuala Lumpur, the Malaysian capital.
  • The Guardian: The eurozone posted a trade surplus of €10.2 billion for October, up from a deficit of €0.7 billion the previous year (with no seasonal adjustments).
  • The Independent: There are "very large" risks to the recently negotiated Greek bailout package, according to a long-awaited report from the European Commission and European Central Bank.
  • The Daily Telegraph: Cyprus could default on loan payments due this month unless it can reach an agreement on a bailout with international lenders within days, a government official said on Monday.
  • The Guardian: More than £5 billion has been illegally siphoned out of Zambia over 10 years, with most of it ending it up in offshore banks and tax havens, according to a report by financial transparency campaigners.
  • The Daily Telegraph: Household energy bills will rise by more than £15 by 2020 to pay for a £38.2 billion upgrade to Britain's networks of gas pipelines and electricity cables, Ofgem said on Monday.
  • Financial Times: Up to 100 financial advice firms that sold high-risk, illiquid Arch Cru funds to retail investors are expected to fail next year as a result of being made to pay compensation, according to the Financial Services Authority.
  • Financial Times: Schroders, the global asset manager, has bolstered its US business after acquiring 100% of STW Fixed Income Management and adding nearly $12 billion to its assets under management.
  • Daily Mail: Grosvenor, the Duke of Westminster’s multi-billion pound property empire, is planning a major reorganisation of its fund management arm to cut spiralling costs.
  • Financial Times: Hunting has resolved a tax dispute with Canadian regulators that will see the London-headquartered international energy services group receive a cash refund of about £25 million.
  • Financial Times: Centamin, the London-listed gold miner, said it had resumed exports from its Sukari mine in eastern Egypt, adding that it expected normal operations to begin again “in the coming days” after clashes with the government over fuel supply and visas.
  • Financial Times: KKR, the US private equity group, has achieved its goal of raising $6 billion for its new Asia fund, according to people familiar with the matter, making it the largest fund focused on the region.
  • The Guardian: Aggreko, the temporary electricity provider that helped power the Olympic Games, said sales would drop next year, sending its shares tumbling over 20%.
  • Financial Times: G4S, the company at the centre of the Olympics security fiasco, is set to win a role in implementing the government’s contentious and complex changes to child benefit and the universal credit.
  • Financial Times: Holcim will take charges totalling $556 million against its fourth-quarter earnings, as the Swiss cement maker presses ahead with the overhaul of its troublesome European operations.
  • The Independent: H&M said like-for-like sales had fallen 1% in November, better than analysts were expecting and an improvement on a 5% drop suffered in October.
  • The Guardian: John Lewis saw an 11% increase in sales to £148 million in its stores compared with the 15% rise year on year reported the week before.
  • Financial Times: DS Smith, the recycled packaging company, is at loggerheads with SCA Group after attempting to claw back some of the €1.6 billion it paid for its Swedish rival’s packaging division.
  • The Guardian: Controversial payday loans firm Wonga is taking on the credit card industry with a product that allows shoppers to pay for goods with a three-month loan.
  • Daily Express: One Media IP Group, a digital music and video rights holder whose portfolio runs from the Sex Pistols to Sooty and Sweep, has appointed advisors to explore options including a move to AIM next year.

Share tips, comment and bids

  • Financial Times: BP said it was selling its stake in the Sean natural gasfield in the UK North Sea to SSE for $228 million in cash.
  • The Daily Telegraph: First Quantum Minerals has launched a £3.1 billion hostile takeover bid for copper and zinc producer Inmet Mining.
  • Financial Times: Sprint Nextel plans to take full control of Clearwire with a sweetened $2.2 billion offer for the remaining 49% stake in the US mobile broadband telecoms business it doesn’t already own.
  • Financial Times: Elliott Management, a $20 billion hedge fund and activist investor, has made a $2.3 billion bid to acquire Compuware, saying the Detroit-based business software maker has underperformed.
  • The Independent: The private healthcare group Bupa has agreed to take over Australia and New Zealand's largest dentistry chain, Dental Corporation, for £244 million.
  • Financial Times: Sun Life Financial has become the latest life assurer to walk away from US annuities, agreeing to sell its business in the country for about $1.35 billion in cash to the backers of Guggenheim Partners.
  • Financial Times: German family holding group Joh A Benckiser is to increase its presence in the US coffee market, buying café chain Caribou Coffee for $336 million six months after it agreed to acquire Peet’s Coffee & Tea.
  • Financial Times: Bharti Infratel, the telecom towers unit of Bharti Airtel, India’s largest mobile phone operator by subscribers, has raised about $760 million in India’s biggest initial public offering for two years.
  • The Independent: Dods, which owns Parliament's weekly magazine The House, has agreed to buy Biteback Media and Holyrood Communications for a total of up to £1.46 million.
  • Financial Times: Six Group, owner of the Swiss stock exchange, is to buy the clearing operations of its Norwegian counterpart for $32 million in a deal which will prepare it for sweeping changes in derivatives markets.
  • Financial Times (Comment – Jeffrey Sachs): Today’s challenges go beyond Keynes; a different kind of growth path is required
  • The Guardian (Comment): Past generations have inflated away their debts knowing they had the power as workers to maintain their wages in real terms.
  • The Guardian (Comment): Give bank ringfencing a chance, but make parliament assess its success after a few years.
  • The Daily Telegraph (Comment): Inflation rocks, but it could spur a bond market crash.
  • The Daily Telegraph (Comment): Savers, don't expect better rates if peer-to-peer lenders replace banks.
  • Financial Times (Lex): First Quantum/Inmet: First Quantum can afford to play a long game, but it is a risky deal: it has not had access to the Cobre Panama copper mine for due diligence
  • Financial Times (Lex): Holcim: News of accelerated cost-cutting at the Swiss-based cement maker Holcim is welcome, but it still looks pricey compared with its peers
  • Financial Times (Lex): Aggreko: The UK power supply rental group, which issued its second profit warning in three months, should be more specific about its capital spending plans
  • Financial Times (Lex): Japan elections: The country’s new prime minister could be the most successful this century, but he will have his work cut out persuading investors to stick around

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FTSE 100 hands back gains as Bank turns hawkish

by Michelle McGagh on Jun 21, 2018 at 17:05

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