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Friday Papers: UK housing bubble ‘risks derailing economy’

Friday Papers: UK housing bubble ‘risks derailing economy’

Top stories

  • Financial Times: The Bank of England has given its strongest warning yet that a housing bubble threatens to derail the UK economy, saying that spiralling property prices were “the very brightest [hazard] light” on its dashboard.
  • The Daily Telegraph: Moody's has said an independent Scotland would likely receive an investment grade rating and that the rest of the UK's credit could actually be improved in the event of a 'yes' vote.
  • The Guardian: Britain's manufacturing recovery powered ahead in the second quarter of the year, with growth in the sector well ahead of expectations in April, pushing the pound to a near five-year high against the dollar.
  • Financial Times: Pfizer is planning to sweeten its £60 billion takeover approach for AstraZeneca in an attempt to increase pressure on its UK rival to enter talks to create the world’s biggest drugmaker.
  • The Independent: Lloyds Banking Group is poised to launch the share sell-off of its £1.5 billion TSB business before the end of June.
  • Financial Times: China fought for a year to undermine new data showing it is poised to usurp the US as the world’s biggest economy in 2014 based on purchasing power, according to people who helped compile the report.
  • The Daily Telegraph: BP is being drawn ever deeper into its costly Russian venture with oil giant Rosneft, quietly extending a five-year loan to help the company lower debt costs despite escalating US sanctions against Russia.

Business and economics

  • Financial Times: Mark Fields will be Ford’s new chief executive following the retirement of Alan Mulally, the man credited with rescuing the carmaker from bankruptcy and avoiding a government bailout in the wake of the financial crisis.
  • Financial Times: With its £450 million deal to buy the UK broadcaster from Richard Desmond’s Northern & Shell Media, US-based Viacom is making a bet that it can bolster the business of the free-to-air television group through investing in original programming and new television watching technologies.
  • Financial Times: US internet companies that collect masses of data about their users dodged a bullet yesterday as a White House study commissioned in the wake of the Snowden surveillance scandal endorsed their main information-gathering practices.
  • Financial Times: Rapid house price inflation is casting a shadow over an otherwise positive run of data showing the UK economic recovery is strengthening and broadening.
  • Financial Times: Recruitment in the City was flat in April as investment banks were held back by a slowdown in fixed-income trading, a recruiter has reported.
  • Financial Times: Africa’s largest development lender plans to launch a $3 billion infrastructure fund this month, aiming to raise money from regional and non-African pension funds, insurance groups, sovereign wealth funds and institutional investors.
  • Financial Times: Lloyds Banking Group strengthened its hand for crucial discussions with the regulator about restarting dividend payments as it bolstered underlying profits and capital in the first quarter.
  • Financial Times: Rio Tinto’s lawsuit claiming Vale cheated it out of billions of dollars adds to the conflicting accounts of the battle over a trove of minerals in a remote corner of Africa – and shines a light on a struggle between the two biggest companies in the global iron-ore market.
  • Financial Times: The chief executive of Smith & Nephew shrugged off fears of stronger competition from rivals in the medical products industry after a flurry of healthcare dealmaking brought together US competitors Zimmer and Biomet.
  • Financial Times: Saga is drawing up plans to expand into retirement villages as the travel-to-insurance provider for older people prepares to branch into new areas after this month’s planned flotation.
  • Financial Times: Sony has issued its third profit warning in six months, as the Japanese electronics and entertainment group booked an additional Y30 billion this year in costs from exiting its unprofitable PC business.
  • Financial Times: The UK regulator has banned a former co-worker of UBS rogue trader Kweku Adoboli from working in the financial services industry.
  • Financial Times: The Danish drugmaker, Novo Nordisk, failed to post quarterly double-digit sales growth for the first time in 12 years, bringing to an end one of the longest such streaks among European companies.
  • Financial Times: Egypt’s political turmoil weighed on BG Group’s first-quarter performance as both profits and production slipped after Cairo diverted gas intended for export to the domestic market.
  • Financial Times: Shares in Weir Group fell yesterday after the FTSE 100 engineer reported weak first-quarter mining demand, despite confirming it remained on target to return to growth this year.
  • Financial Times: The effect of this year’s cold winter in the US in pushing up natural gas prices helped ExxonMobil and ConocoPhillips, two of the largest US oil companies, report earnings significantly above analysts’ expectations for the first quarter of 2014.
  • Financial Times: NYSE Euronext was hit with its second regulatory fine in less than two years for failing to comply with rules related to co-location services, block trades and net capital requirements.
  • Financial Times: UK authorities have been probing past transactions between a division of Anglo-Dutch publisher Reed Elsevier and Iranian banks, to consider whether sanctions may have been breached.
  • Financial Times: Schroders reported a big jump in pre-tax profits, net inflows and an increase in assets under management as the improving economic landscape bolstered its business.
  • Financial Times: The Financial Conduct Authority has approved new rules to strengthen the position of minority shareholders when a controlling investor attempts to take a listed company private.
  • Financial Times: British Sky Broadcasting has heralded a surge in television customers as it seeks to reassure investors about the potential for revenue growth; Britain’s largest pay TV operator by subscribers added 74,000 new television customers in the three months to March, twice as many as a year earlier, amid a rise in marketing spend.
  • Financial Times: Rolls-Royce’s chief executive said he was “reasonably optimistic” about concluding the sale of the company’s energy business to Siemens in a deal expected to raise at least £900 million.
  • Financial Times: N Brown, the clothing retailer that makes almost two-thirds of its sales online, is reversing the industry trend by heading back to the high street – with plans to open 25 stores across the UK.
  • Daily Mail: BSkyB brushed off competition from BT as it snared TV customers at twice the rate of last year during the third quarter.
  • Daily Mail: Marks & Spencer has predicted online sales will exceed those from its chain of 800 stores within three years, as its recently launched website gains traction.
  • The Guardian: Former chancellor Lord Lawson has called for an end to Help to Buy in London's property market, arguing that this could be done by bringing the threshold for eligible properties down to £300,000.
  • The Guardian: Rolls-Royce said revenue and profit would now be weighted towards the second half of the year.
  • The Guardian: The minimum wage should be frozen for a decade, reduced to 44% of average weekly earnings and vary between states and territories, according to the Commission of Audit.
  • The Guardian: The annual rate at which UK house prices are increasing moved into double digits in April, according to figures from the country's largest building society, as low mortgage rates and a mismatch between supply and demand for homes continued to drive the market.
  • The Independent: The latest stunning evidence of a UK manufacturing revival sent the pound surging to a five-year high yesterday as the City upped its bets on early interest rate rises.
  • The Independent: New Serco boss Rupert Soames reassured investors he understood their concerns over yet another profit warning on his first day in charge of scandal-struck outsourcer.
  • The Daily Telegraph: Energy department has hailed "major milestone" as Toshiba and GDF Suez agree key commercial terms for option to build reactors at Moorside site in West Cumbria.
  • The Daily Telegraph: Defence group BAE has landed £125 million contract extension to maintain RAF's fleet of Tornado GR4 jets until they go out of service.
  • The Daily Telegraph: Mongolia is set to resolve Rio Tinto copper mine tensions; government opposition to Rio Tinto's copper mine should soon be resolved, as a government official admits "mistakes".
  • The Daily Telegraph: Deloitte survey has warned of weakening investment outlook for North Sea oil drillers amid weaker crude prices.

Share tips, comment and bids

  • Financial Times: Fat Face is pressing ahead with plans to become the latest UK retailer to list with the casual fashion chain hoping to raise £110 million in a flotation that would value it at about £440 million.
  • Financial Times: Alibaba, the Chinese ecommerce group, is in talks to buy back a stake in its online payment arm Alipay, which in 2011 was sold for a nominal sum to a vehicle controlled by Jack Ma, Alibaba’s founder and chairman, according to a person close to the situation.
  • The Daily Telegraph: Cloud software company, Box, will make its initial public offering later than expected.
  • The Daily Telegraph: Hawthorn Leisure, an ambitious new company backed by Avenue Capital and former Lazard investment banker Noah Bulkin, has made its first acquisition - 275 pubs of Greene King.
  • Financial Times (Lex): Ford – changing drivers.
  • Financial Times (Lex): Vale/Rio Tinto: Simandou blues.
  • Financial Times (Lex): Lloyds: the road to Shangri-La.
  • Financial Times (Lex): Japanese airlines: yen blues.
  • Financial Times (Lex): Yelp – positive review.

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