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Thursday Papers: US Fed lifts rates as economy strengthens

Thursday Papers: US Fed lifts rates as economy strengthens

Top stories

  • Financial Times: The Federal Reserve raised short-term interest rates by a quarter-point following its latest two-day meeting; new Fed chairman said that the economy was healthier than it had been in 10 years, which justified the recent increases in rates.
  • The Times: A British group of advertisers has threatened to pull out of Facebook as Mark Zuckerberg broke his silence on the Cambridge Analytica scandal, admitting that the company had made mistakes.
  • The Daily Telegraph: After a succession of high-level EU trips to Washington, EU leaders are hopeful the economic bloc will get an exemption from looming US steel and aluminium tariffs, avoiding a full-blown trade confrontation with the Trump administration.
  • Financial Times: Dealmaking worldwide this year surpassed the $1 trillion mark on Tuesday, up more than 50% from a year ago, buoyed by quickening economic growth and strong business confidence.
  • The Times: Former French president Nicolas Sarkozy allegedly received €50 million campaign funding from the late Libyan ruler Colonel Muammar Gaddafi; Sarkozy has been placed under formal investigation on suspicion of corruption.

Business and economics

  • Financial Times: Eurosceptic Conservative and Democratic Unionist MPs have threatened to oppose a final Brexit withdrawal deal over plans to keep the UK in the EU’s Common Fisheries Policy until 2020.
  • The Times: Crude prices last night surged 3.6% to its highest level in six weeks after a sudden decline in US stockpiles and renewed concerns that the new US secretary of state might reapply sanctions on Iran.
  • The Daily Telegraph: European Commission might slap an extra €5 billion tax bill each year on the world’s biggest technology firms operating in the EU as governments face “an ever-bigger black hole” in their finances.
  • The Times: Factory activity in UK showed a sigh of slowdown this month after a survey from the CBI employers’ group indicated the order book balance fell from +10 in February to +4 in March, the lowest since October.
  • The Times: Royal Dutch Shell may roll out an ambitious expansion plan to open more than 10,000 new petrol stations by 2025 in fast-growing markets such as China, India and Mexico.
  • Daily Mail: Interserve’s stocks jumped yesterday after the outsourcer struck a crucial refinancing deal with its lenders – including HSBC, Lloyds, RBS and Barclays – that will see it get a £196.6 million cash injection and £95 million in bonds; shares surged 25.75% to 87.9p shortly before market close.
  • Daily Mail: Accountancy firm PwC, hired to wind up collapsed builder Carillion, has charged £20. 5 million for eight weeks work; raising questions of conflict of interest, PwC also advised the Government on Carillion in the run-up to its collapse.
  • The Times: Swiss iron ore pellet producer Ferrexpo has announced a 47% jump in earnings to $551 million for 2017, thanks to higher prices; the company awarded a record dividend to its shareholders for last year.
  • Financial Times: Chinese carmaker Geely’s profits more than doubled on the back of strong sales of sport utility vehicles; last month, Geely acquired nearly 10% of Daimler, demonstrating its global ambitions.
  • Daily Mail: French fashion house Hermes has registered bumper sales and profits helped by a handbag named after the singer Jane Birkin, and selling for £6,000 and upwards.
  • Financial Times: Shares of HelloFresh jumped 6% yesterday after the fast-growing Berlin-based meal kit business unveiled a 52% surge in sales; the company also announced a deal to acquire organic US meal kit provider Green Chef that would help HelloFresh enter the market for trendy Paleo and Keto diets as well as organic and gluten-free foods.
  • The Guardian: Lloyd’s of London plunged into a £2 billion loss in 2017, its first in six years, as the insurance industry was ravaged by a series of major earthquakes and hurricanes.
  • The Times: Retailer Moss Bros said it expected profits to be “materially lower than market expectations” amid weak consumer confidence and stock shortages.
  • Daily Mail: Thousands of jobs came under threat on Wednesday after Carpetright said that it may have to shut some of its 470 UK stores; meanwhile, New Look has agreed a restructuring plan with creditors that will axe it's 60 stores, cutting up to 980 jobs.
  • The Times: DIY chain Kingfisher saw its shares tumbling yesterday on concerns about consumer confidence and the pressure on retailers; however, the company said that its transformation strategy remained on track.
  • The Times: Vauxhall’s UK retail network could fall by more than 30%, axing thousands of jobs; PSA, which acquired Vauxhall last summer, is trying to find €1 billion of savings and appears headed towards the 324 UK Vauxhall dealerships.
  • Financial Times: Deutsche Bank’s chief financial officer James von Moltke has said that more radical cutbacks at the lender’s investment banking division cannot be ruled out if it fails to improve.
  • Financial Times: Crest Nicholson’s annual general meeting today faces a potential shareholder revolt after Institutional Shareholder Services recommended voting against moving UK housebuilder’s chief executive to the chairmanship.
  • The Guardian: Bargain Booze’s owner Conviviality has said in a stock exchange announcement that it may go bust unless it raises £125 million; the company, which issued its third profits warning in a month, said that the funding would help it pay a £30 million tax bill.
  • Financial Times: Fonterra chief executive Theo Spierings is set to resign after the world’s biggest dairy exporter plunged into a NZ$348 million first-half loss due to problems at its Chinese partner.
  • Financial Times: Washington plans to apply “maximum pressure” on China through new targeted tariffs to stop it stealing the intellectual property of US business, according to Robert Lighthizer, US trade representative.

Share tips, comment and bids

  • The Daily Telegraph (Questor share tips): BUY Abercrombie & Fitch.
  • The Times (Tempus share tips): BUY Facebook; HOLD Vectura.
  • The Daily Telegraph: The UK Competition and Markets Authority has given green signal to the planned merger between GVC and Ladbrokes.
  • Daily Express: European Commission has approved the £46 billion takeover of Monsanto by Bayer, completing the last of a trio of mega mergers that will restructure the agrochemicals industry.
  • Daily Mail: In a major boost to the efforts to save GKN from Melrose’s hostile bid, US engineer Agco Corporation, which makes tractors and other agricultural equipment, has supported GKN's plans to team up with Dana.
  • The Times: Reckitt Benckiser has exited from the talks to acquire consumer healthcare business of Pfizer, clearing the way for Glaxosmithkline to complete the deal.
  • The Daily Telegraph (Comment): The next global recession will entirely reshape the Brexit debate.
  • Financial Times (Comment): Changing fortunes for Nokia and Ericsson; arch-rivals struggle to find good businesses beyond their core networks operations.

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