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Tuesday Papers: Carney looks beyond rates to steer UK upturn

Tuesday Papers: Carney looks beyond rates to steer UK upturn

Top stories

  • Financial Times: Bank of England Governor Mark Carney said on Monday that he favours initially using tools other than interest rates to help control the UK’s economic recovery and to prevent the housing market rapidly moving from “stall speed to warp speed”.
  • Financial Times: EADS is to cut 5,800 jobs at its defence businesses and close sites in Paris, Munich, Spain and Britain as it tries to lift its lagging profit margins and deal with the steep reduction in European defence spending.
  • The Guardian: The US government ended up losing $10.5 billion on its bailout of General Motors, but still says the alternative would have been much worse; Treasury secretary Jacob Lew announced Tuesday that the government sold its remaining shares in the Detroit automaker.
  • Financial Times: Lloyds Banking Group is set for a £670 million capital boost after the taxpayer-backed bank pressed the button on the sale of its remaining stake in the wealth manager St James’s Place.
  • The Guardian: HSBC has played down the prospect of spinning off its UK business in a separate stock market listing in a move that would undo its takeover of Midland Bank 20 years ago.
  • Daily Mail: Punters pumped up the volume at Weir Group, 20 pence better at 2,072 pence, on Monday, as rumours suggested that General Electric could be weighing up a possible £5.9 billion or £28 a share bid for the Glasgow-based group.
  • The Daily Telegraph: Central banks have lost $400 billion in gold rout.
  • Financial Times: Kazakhmys is selling its remaining stake in Kazakhstan’s biggest power station for $1.3 billion as it sheds peripheral assets and focuses on expanding its core copper-mining business.
  • Financial Times: A London court has sentenced Elias Preko, a former Goldman Sachs banker, to four and-a-half years in prison for helping a Nigerian politician to launder money.
  • Financial Times: Former Deutsche Bank managing director in Hong Kong, Ma Sin-chi, 39, has been sentenced to seven years in prison for accepting illegal bribes in return for investment tips.
  • Financial Times: Trilantic Capital Partners, the private equity group that emerged from Lehman Brothers after its collapse, has amassed $2.2 billion of commitments from investors for its first fund as an independent team.

Business and economics

  • The Independent: US politicians are closing in on a deal to ease the impact of spending cuts worth up to $200 billion which are due to hit home next year, it emerged on Monday.
  • Financial Times: Europe is on the brink of a banking union deal that will bring a “real revolution” to its financial system, France’s finance minister Pierre Moscovici predicted, as he signalled differences with Germany on a system to fund failed banks were narrowing.
  • Financial Times: UK ministers are under growing pressure to intervene against plans by the island of Malta to sell EU passports for €650,000, allowing buyers immediate rights of residency in all member states.
  • Financial Times: The US chemicals industry is planning a sharp increase in its exports as a result of the cost advantage created by the shale gas boom, putting pressure on competitors in Europe and Asia.
  • Financial Times: Wall Street’s efforts to overturn the Volcker rule, which regulators are due to ratify on Tuesday, will fail in the courts, according to Barney Frank, who spearheaded the US post-crisis overhaul of financial regulations.
  • Financial Times: Foreign banks in China have warned that they will suffer severe “collateral damage” from new rules aimed at limiting off-balance sheet lending by domestic banks.
  • The Guardian: Current account customers have been switching to Halifax from troubled rivals such as Co-operative Bank and Royal Bank of Scotland, its boss said on Monday, as the bank returned to Scottish high streets for the first time in a decade.
  • Financial Times: Activist investor Carl Icahn has forced his way on to another board – medical diagnostics group Hologic.
  • Financial Times: Carlyle has chosen Madrid over London for the multibillion-euro stock market listing of Applus, an industrial testing company, in a boost to the Spanish exchange as investor confidence gradually returns to the country.
  • The Guardian: Kate Swann, the former chief executive of WH Smith, quit the stationer this year sitting on bonus payments, shares and options worth up to £13 million.
  • Daily Mail: Investors pulled £1.4 billion out of Invesco Perpetual’s flagship funds last month, after the resignation of its star fund manager Neil Woodford.
  • The Daily Telegraph: H&M plans to improve pay rates for textile workers in countries such as Bangladesh, where the minimum wage is less than £1.22 a day
  • The Guardian: Pre-tax profits at pawnbroker Albemarle & Bond plunged to £4.9 million in the year to 30 June from £21.4 million a year earlier after a 23% fall in the price of gold
  • The Independent: Morrisons supermarket has scrapped window cleaning in a bid to slash costs as it battles declining sales.
  • Financial Times: Edward Bonham Carter, one of the longest serving chief executives among the UK’s top investment groups, is to step down as head of Jupiter Fund Management.
  • The Guardian: Royal Mail staff will get a pay increase of more than 9% over three years after the company and its union announced what they said was a groundbreaking legal agreement on industrial relations at the newly privatised company.
  • Financial Times: A deal between Punch Taverns and its bondholders about the restructuring of its £2.3 billion net debt edged a little closer after the pub group revealed its latest proposals.
  • The Guardian: Ryanair has halved its excess baggage fee to €10 a kilo in its latest attempt to appease customers frustrated and angry with its additional charges and reputation for abrasive service.

Share tips, comment and bids

  • The Daily Telegraph (Questor share tip): RWS Holdings reports soaring profits; record profits, a fast growing dividend and inheritance tax relief are all on offer by owning shares in Aim-listed patent translation firm RWS Holdings.
  • The Daily Telegraph (Questor share tip): Premier Oil downgraded on slow recovery; the oil exploration and production company has struggled with production issues.
  • The Guardian: The world’s biggest airline was officially created on Monday with the merger of American Airways and US Airways, capping a round of consolidation that has worried the US government, rivals and consumer groups.
  • Financial Times: Sysco has reinforced its position as the US’s top food distributor by snapping up rival US Foods in a deal valued at $8.2 billion including debt.
  • Financial Times: Shares in Kentz jumped by a tenth on Monday after the FTSE 250 oil services group launched a $435 million takeover of privately owned gas handling specialist Valerus Field Solutions.
  • The Guardian (Editorial): With wages stagnant, prices rising and incomes so skewed to the top, it is haughty folly to assume the public is merely confused.
  • The Daily Telegraph (Comment): Unfortunately, the near free money environment has gone on for much longer than anyone anticipated, and we seem incapable of easing ourselves off the life support.
  • The Daily Telegraph (Comment): Spinning out its UK retail business would not solve any of HSBC's regulatory problems and could create several new headaches for the country's largest bank.
  • Daily Mail (Comment – Alex Brummer): A new report proposes that acquisitions in key sectors like energy and defence should be scrutinised.
  • Financial Times (Lex): HSBC: Bank should not float UK retail arm, which would sit nicely with UK’s incoming ringfencing rules, simply to arbitrage a divergence in valuations
  • Financial Times (Lex): Sysco’s purchase of US Foods for $8 billion creates an exit problem for the No 3 player in the sector – Blackstone’s Performance Food Group
  • Financial Times (Lex): Kazakhmys: the UK-listed, Kazakhstan-based copper miner needs time, and cash, to develop growth projects. Better prospects lie elsewhere.
  • Financial Times (Lex): Covidien’s move to buy Given Imaging looks healthy but the company’s push into emerging markets is more important for investors.

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