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Tuesday Papers: Junk-bond prices point to return of bulls

Tuesday Papers: Junk-bond prices point to return of bulls

Top stories

  • Financial Times: The junk-bond market is sending a bullish signal for the global economy in 2013, with investors in US high-yield securities earning higher returns so far this year than those who have bought investment-grade debt.
  • Financial Times: HMV is to go into administration, delivering a further blow to Britain’s embattled high streets after suppliers refused a request for a £300 million lifeline for the struggling retailer.
  • The Guardian: The Bank of England is to be given sweeping new powers to prevent house prices spiralling out of control, amid predictions that a year of stable house prices in 2013 will spark a resurgence in homebuying.
  • Financial Times: Britain’s biggest banks have thrown their weight behind the creation of a tough new professional standards body for the UK’s beleaguered financial sector as they brace for reaction to bonus awards in the coming months.
  • Financial Times: The proposed €5.2 billion takeover of Dutch delivery group TNT Express by UPS has collapsed after the European Commission indicated it would block the deal.
  • Financial Times: JP Morgan Chase is being penalised for failures in risk management that led to a multibillion-dollar loss on credit derivatives by a trader dubbed the “London whale”; Jamie Dimon, chief executive of the bank, will have his bonus for last year docked by the board in a sign of personal accountability for the failures.
  • The Independent: Goldman Sachs is forecast to report on Wednesday that profits jumped to about $6.3 billion last year, from $4.44 billion in 2011, helped by strengthening revenues from bond and share trading.
  • Financial Times: Goldman Sachs provoked a furious reaction in Westminster after it emerged that the US investment bank was mulling a plan to delay its UK bonus payments to take advantage of the imminent cut to the top rate of tax.
  • The Guardian: The extradition of a former Credit Suisse trader Kareem Serageldin to the United States to face fraud charges has been approved by Westminster magistrates court.
  • Financial Times: Shares in Apple shaved the $500 mark in pre-market trading and closed down almost 3.6% at $501.75 in New York on Monday, as investors, already jittery about the iPhone maker's results next week, were spooked by reports of supply-chain cutbacks.
  • The Daily Telegraph: Apple has slashed orders on parts for the iPhone 5 in what could be a sign of pressure from Samsung and other rivals.
  • Financial Times: Taube Hodson Stonex Partners, a big independent shareholder in Bumi Plc, plans to support Nat Rothschild’s attempt to oust the board of the contentious coal miner.
  • The Daily Telegraph: Financier Nat Rothschild has spent more than £16 million buying shares in Bumi, boosting his firepower in the bitter struggle for control of the bombed-out Indonesian coal mining group.

Business and economics

  • The Daily Telegraph: Banks are facing an unprecedented level of intrusion under new powers that will allow the Bank of England to crack down on specific activities, from mortgage lending for first-time buyers to off-balance sheet securitisations.
  • Financial Times: Worldwide PC shipments totalled 90.3 million units in the fourth quarter of 2012, a 4.9% decline from the fourth quarter of 2011 while PC shipments in Europe, the Middle East and Africa fell by 9.6%, according to preliminary results from Gartner.
  • Financial Times: President Barack Obama called on Republicans in the US Congress to lift the country’s debt limit without preconditions, saying markets could go “haywire” if there is another confrontation over allowing new borrowing.
  • Financial Times: The European Commission has concluded that China is providing illegal subsidies to its steel manufacturers, paving the way for European companies to seek higher import tariffs on a wide range of Chinese products.
  • Financial Times: India’s government has delayed the introduction of controversial tax avoidance laws, the latest in a series of measures intended to rebuild trust among foreign investors worried about the nation’s faltering economy.
  • Financial Times: China has surged ahead of the US to regain its title as the world’s biggest investor in renewable energy, new figures showed on Monday.
  • The Daily Telegraph: The number of staff being sacked or suspended at financial institutions for reasons such as wrongdoing has reached a five-year high, figures have revealed.
  • Financial Times: The National Rifle Association has released an app that includes a 3D shooting game, stirring controversy as the country debates new gun regulation.
  • Financial Times: Hopes that Dell is once again considering taking itself private prompted a 13% jump in the shares of the battered US technology company, bringing some relief amid the gloom that has settled over the troubled PC industry in recent weeks.
  • The Guardian: The number of Facebook's UK users dropped by 600,000 in December, according to data by social media monitoring firm SocialBakers.
  • The Daily Telegraph: Tweetdeck, the well-known Twitter platform, is under threat of closure over failure to file company accounts.
  • The Independent: Baidu, China’s biggest internet search engine, has signed a deal with France’s Orange to appear on the homescreen of the mobile giant’s telephones across Africa.
  • Financial Times: KBC, the Belgian financial group that received €7 billion in state aid in 2009, is poised to follow Barclays’ example and issue a bond with a permanent writedown feature under which investors could lose their money even if the bank stays in business.
  • Financial Times: Carl Icahn, the corporate raider, has disclosed an effective 3.2% stake in Transocean, the offshore drilling contractor that owned and operated the Deepwater Horizon rig that sank in the Gulf of Mexico in 2010.
  • The Daily Telegraph: Spanish power giant Iberdrola has shelved a plan to sell off part of its Scottish Power division.
  • Financial Times: Tata Consultancy Services, India’s largest IT outsourcing group by revenue, announced that net profits rose 23% to $651 million in the third quarter, up 23% from the same period the year before.
  • The Daily Telegraph: Investors have rushed in to reserve luxury homes planned for the revamped Battersea Power Station, with 600 of the 800 properties already claimed after just five days on the market.
  • The Daily Telegraph: Ingenious Media, the media finance company run by Patrick McKenna, is to launch a new £10 million investment fund - as it invests £1 million in an online business which aims to take live theatre to the classroom and beyond.
  • Financial Times: Capital Shopping Centres is to rename all of its 14 shopping malls, which include the Trafford Centre and Lakeside, in an effort to establish a consumer-facing brand.
  • The Daily Telegraph: Taylor Wimpey said full-year profits would be at the "upper end" of its expectations, as the housebuilding sector's recovery is boosted by recent mortgage rate cuts by major lenders.
  • The Independent: Sainsbury’s chairman, David Tyler, is moving into property, succeeding John Nelson at the helm of Hammerson in May.
  • The Guardian: Pressure is mounting on Marks & Spencer boss Marc Bolland, after a major shareholder said his job is under threat unless the retailer's flagging clothing business improves by September.
  • Financial Times: Bumper sales of dinner jackets and suits amid the downturn have prompted Moss Bros to upgrade pre-tax profit projections from £1.75 million to £2.6 million.
  • The Daily Telegraph: Luxury fashion e-tailer Net-A-Porter.com saw sales rise from £238 million to £368 million last year.
  • Financial Times: A new smartphone app from British Telecom will let customers connect their landline tariffs to their smartphones as the telecoms group seeks to benefit from customers looking for ways to minimise their mobile phone bills.

Share tips, comment and bids

  • Financial Times: Swatch Group is to buy Harry Winston Diamond Corporation’s jewellery and watch division for about $1 billion, in a move that will help realise the Swiss watchmaker’s long-held aim of increasing its presence in the jewellery market.
  • The Guardian (Comment): Obama says the US is not a 'deadbeat nation' about to default. But if Congress won't raise the debt ceiling, then actually it is.
  • The Guardian (Comment): This assault on an entire social contract is what Michał Kalecki warned about.
  • The Daily Telegraph (Comment): When it comes to Europe, Cameron represents the silent majority.
  • The Daily Telegraph (Comment): Brussels must explain why EU failed to deliver UPS-TNT deal.
  • Daily Mail (Comment – Alex Brummer): We should not be surprised that the idea of postponing bonus pay-out dates until after 5 April, the date that the highest rates of tax in Britain drop from 50% to 45%, looks to have begun at Goldman Sachs.
  • Financial Times (Lex): Apple: even if rumours about lower orders for iPhone 5 screens are true, the group is so large the usual rules of growth and valuation do not apply.
  • Financial Times (Lex): TNT Express shareholders nurse wounds after UPS abandons a deal to buy the company, pushing its shares down 42%.
  • Financial Times (Lex): Saint-Gobain/Ardagh: French industrial group sells some of its bottle-making business to an up-and-coming Irish glass and metal packaging company.
  • Financial Times (Lex): Generali sets strategic course: the Italian insurer wants to fix past mistakes before asking investors to cough up cash for big acquisitions.
  • Financial Times (Lex): Singapore property: the government has brought in unexpectedly punitive measures to cool its property market after six attempts in three years.

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