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Monday Papers: Central banks set to cut debt holdings

Monday Papers: Central banks set to cut debt holdings

Top stories

  • Financial Times: Central banks are planning to cut their exposure to longer-term debt to protect themselves from losses when the Federal Reserve ends its bond-buying this autumn, increasing the risk of instability in global markets.
  • The Daily Telegraph: One of the Bank of England's most dovish policymakers, David Miles, says increasingly likely he would vote to raise rates from a record low of 0.5% before leaving the committee next May.
  • Daily Mail: Shareholders have geared up to flex their muscles again as investors plan to target Tesco, RBS, and WPP at annual meetings.
  • The Guardian: Global investors are betting on a substantial property boom despite warnings that housing in many countries is already overvalued; according to a study, sovereign wealth funds are seeking to boost returns by placing a larger proportion of their funds than last year in property, infrastructure projects and emerging markets.
  • Financial Times: Banks including Barclays and UBS are accelerating a shift towards automation in foreign exchange and rates trading as they move to slash costs and reduce the risk of further price manipulation scandals.
  • Financial Times: European airline shares have fallen sharply as growing violence in Iraq marks the end of an unprecedented period of low volatility in oil prices.
  • Financial Times: France’s socialist government has claimed a resounding victory for state intervention after forcing General Electric to significantly revise its $16.9 billion takeover deal for Alstom’s energy businesses, which both companies approved at the weekend.
  • The Daily Telegraph: Zoopla boss, Alex Chesterman has pointed out that London is not in a property bubble as the capital ought to be a more expensive place to live.
  • Financial Times: The Foreign and Commonwealth Office has halved its counter-terrorism budget even as officials warn of the most severe threat to the UK from overseas terror groups since the London bombings in 2005.
  • Daily Mail: Fresh figures due out this week could show that Britain’s economy is growing at its fastest rate since 2007; the Office for National Statistics will release a first-quarter growth revision, with research firm IHS Global Insight predicting that the earlier estimate of 0.8% quarter-on-quarter may hit 0.9%.

Business and economics

  • Financial Times: Shire will on Monday step up its defence against a £27 billion takeover approach by AbbVie amid a growing sense of siege surrounding Britain’s healthcare sector.
  • Financial Times: The tax tribunal is gearing up for a surge of legal challenges, after tens of thousands of financiers, celebrities and other users of avoidance schemes are issued with demands to pay tax avoided over the past decade.
  • Financial Times: UK chancellor will float the idea of building a high-speed rail link between Manchester and Leeds as part of his plan to create a “northern powerhouse” for the British economy.
  • Financial Times: The pot of money that ministers have set aside to subsidise UK renewable power is likely to run out much more quickly than previously thought, according to research, placing green energy projects in jeopardy.
  • Financial Times: The number of state aid approval requests by the UK to the European Commission continued to rise last year despite the economic recovery, research has found.
  • Financial Times: Bulgaria’s central bank on Sunday announced the nationalisation of Corporate Commercial Bank, an overstretched private lender, in a bid to head off a large-scale bank run in the EU’s poorest member state.
  • Financial Times: World trade had an anaemic start to 2014 according to figures that confirm the faltering state of the global economic recovery six years on from the collapse of Lehman Brothers.
  • Financial Times: Increasing numbers of shareholders are demanding that US companies account for their political spending, as annual meetings become the latest stage in the country’s electoral wars.
  • Financial Times: Chinese banks are borrowing record amounts from international bond investors, as they seek to shore up their balance sheets ahead of strict new rules for capital requirements.
  • Financial Times: Britain’s neglected medium-sized companies expect to grow faster than their mainland European rivals during the coming year, but they are being held back by the UK tax system, business leaders say.
  • Financial Times: France has launched a strong attack on the US-based international body that governs internet addresses, calling its decision-making “totally opaque” and saying a move to assign domain names for wine could threaten talks on a transatlantic trade deal.
  • Financial Times: European companies that raise finance are taking on levels of debt not seen since the financial crisis as they adjust to the prospect of low interest rates for the foreseeable future; ratio of debt to company earnings, or “leverage multiples”, for all European transactions were 5.1 times earnings in the first quarter of 2014, above the 10-year average (4.8 times) for the first time since 2008.
  • Financial Times: A new corporate structure is rapidly gaining popularity among US-listed power generators: the “yieldco”, a vehicle that earns stable cash flows and distributes them in dividends, offering a low-cost source of capital for renewable energy.
  • Financial Times: Italian and foreign investors are challenging the legality of cuts in subsidies to the rapidly expanding solar power sector imposed by Matteo Renzi’s new government, which the industry warns will undermine Italy’s credibility in attracting fresh investments.
  • Financial Times: The US’s top motor safety regulator has outlined plans for his agency to revolutionise its approach to monitoring vehicle safety, as it faces the challenge of making increasingly self-driving cars safer than their human-driven counterparts.
  • Financial Times: The wave of challenger banks entering the UK market is expected to boost regional lending because a number have chosen to base themselves outside London.
  • Daily Mail: Morrison has fired a salvo in the price war between the supermarkets being threatened by discounters such as Aldi and Lidl – by announcing price cuts.
  • Daily Express: Families had a cash boost from falling clothing and food costs for the eighth month in a row in May as retailers slashed prices to attract customers, a survey showed.
  • The Guardian: An awful year for the Co-operative Group - which slumped to a loss and was forced to relinquish control of its banking arm - has led to a slowdown in the annual growth of the wider movement and a fall in membership, according to a report.
  • The Guardian: Lawyers for workers sacked when electrical goods retailer Comet collapsed in 2012 have asked a government investigation to consider whether Deloitte, the administrators involved, should face criminal charges.
  • The Guardian: British Airways is facing the threat of renewed strikes after cabin crew said they were prepared to take industrial action after their pay claims were rebuffed.

Share tips, comment and bids

  • Financial Times: Philip Falcone is close to mounting a $1.1 billion unsolicited takeover of one of the US’s largest lawn seed producers, Central Garden and Pet, in what would mark a return to dealmaking by the high-profile hedge fund manager.
  • Daily Express: Global Invacom is hoping to raise a minimum of £5.8million when it lists at the end of this month at AIM.
  • The Daily Telegraph: Europe's largest online eyewear retailer MyOptique Group raised £16 million to fund marketing expansion.
  • The Daily Telegraph: Irish telecoms operator, Eircom, which fell into bankruptcy two years ago, plans to raise money through a London float to pay down debt.
  • Financial Times (Lex): Coal India: lumpy.
  • Financial Times (Lex): South Africa: exports, please.
  • Financial Times (Lex): Yieldco: making it rain.

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