Monday, July 9, 0730 BST
It never rains, but...
Stuart Rose may regret his declaration last November that “weather is for wimps”. The Times reports that Marks & Spencer (M&S) is expected to reveal a slowdown in trading on Tuesday as it admits the impact of the wettest June since Met Office records began.
More on M&S here
Analysts expect that M&S will reveal a one per cent rise in underlying sales, a dramatic retreat from the 3.8 per cent recorded in the previous quarter.
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Deutsche Bank says that M&S has missed internal sales targets by nearly £20 million as summer outfits and barbecue food go unsold. The shares have already slumped 16 per cent during the past seven weeks.
As if the brooding weather’s not enough, spirits have been dampened by five interest rate increases and security fears after the car bomb attempts. How will Mr Rose explain his woes?
Taking flight?
Singapore Airlines is reviewing the future of its stake in Sir Richard Branson’s Virgin Atlantic - a move that could lead to a £1 billion sale or initial public offering, according to The Daily Telegraph.
More on Virgin Atlantic here
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The carrier, which is among the biggest by passenger numbers, is in the early stages of examining options for its 49 per cent stake in Sir Richard’s flagship company.
Singapore Airlines paid £600 million for the holding in Virgin Atlantic eight years ago, before the global passenger aviation industry was hit by the September 11 terrorist attacks, the Asian Sars epidemic and the Iraq war.
Waiting in the wings would be private equity, presently examining takeovers of airlines including Italy’s Alitalia and Spain’s Iberia.
Share and share alike
A thaw in Russia’s business climate? The Financial Times says that Gazprom is “very close” to a deal to develop the vast Shtokman gas field in Russia – and international energy groups can be partners.
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More on Gazprom here
Alexander Medvedev, the company’s deputy chief executive, told the newspaper that Gazprom was in talks about a “new model” of co-operation that would “allow foreign partners to share in the economic benefits of the project, share the management and take on a share of the industrial, commercial and financial risks”.
Only last October the company said that international companies could not take equity stakes in the licence and could work only as contractors.
Signing a deal to develop one of the world’s biggest gas reserves would be an important success for any of the three groups that have been in talks with Gazprom: Statoil and Norsk Hydro of Norway, which are in the process of merging, Total of France and America’s ConocoPhillips.
First to last
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The Financial Times reports that almost 20,000 customers have closed bank accounts at First Direct since it started charging a monthly fee in February.
More on First Direct here
The telephone and online bank, which is owned by HSBC and has more than 1.2 million customers, charges current account customers £10 a month if they do not pay in £1,500 a month or maintain an average balance of that amount.
About 195,000 customers can avoid the fee only if they pay in more or take out another product such as a savings account.
First Direct has argued that it had to charge to provide the same level of service, even to customers who were not profitable for the bank. Would the Office of Fair Trading - which is investigating the fairness of charges on current accounts - take the same view? It is expected to report this year.
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From Russia with ...
Capturing two of Russia’s biggest flotations of this year has helped the London Stock Exchange (LSE) to more than double the value of the initial public offerings handled by it during the past quarter, says The Times.
More on LSE here
The LSE raised a cumulative €14.8 billion (£10 billion) for 102 companies in the three months to June 30, a 129 per cent rise on the same period last year.
The LSE’s status as Europe’s biggest stock market in terms of both money raised and volume was cemented by its hosting of the flotations of Russsia’s VTB Bank and AFI Development, a property company, the largest two of the Continent’s top five initial public offerings in the quarter.
Separately, financial experts expect the world’s stock markets to break through to uncharted highs this year as a record $2,300 billion (£1,150 billion) wall of cash is reinvested in equities.
More here
Fashion float
Prada has stuck a price tag of between €3billion and €3.5 billion (£2 billion-£2.4 billion) on the business amid speculation that Richard Caring, the rag-trade billionaire, is considering a bid for the Italian luxury fashion chain.
More on Prada here
The newspaper says Tomaso Galli, a Prada spokesman, denied suggestions that Prada was up for sale. Mr Caring and two unnamed private equity firms had been reported as interested in bidding for the group.
Mr Galli then said that the luxury goods group was worth €1 billion more than the €2 billion reported in the media at the weekend, which will be taken as a sign that the company could be interested in a bid above €3 billion.
Last summer, Banca Intesa took a 5 per cent stake in the group for €100 million, valuing the company’s equity at €2 billion plus €700 million in debt.
Down a level
There’s a new game in town – deep discounts. Sony will cut the price of the PlayStation 3 game console in the US and Canada by $100 in an effort to double sales of the struggling player.
More on Sony here
The Bloomberg news service reports that a PlayStation 3 with a 60-gigabyte hard drive will sell at a 17 per cent discount – or $499 - starting on Monday. Sony predicts that the price cut will double US sales of the player.
The move will take customers from Microsoft, forcing the Xbox 360 maker to drop the price of its $479 Elite model, according to analysts. Nintendo’s Wii, the top-selling console at $249, is less likely to be affected.
How do sales stack up? US consumers have bought 1.38 million PlayStation 3s and 2.84 million Wii players since November. Microsoft’s Xbox has had sales of 5.5 million.
MARKETS
FTSE 100 (Friday close): up 54.90, or 0.8%, at 6,690.10
Dow (close): up 45.84, or 0.3%, at 13,611.68
S&P 500 (close): up 5.04, or 0.3%, at 1,530.44
Nasdaq (close): up 9.86, or 0.4%, at 2,666.51
Nikkei (latest): up 113.51, or 0.6%, at 18,254.45
Hang Seng (latest): up 150.58, or 0.7%, at 22,682.32
Sterling (latest): $2.0112
Oil (latest): West Texas crude down 25 cents at $72.56
Gold (latest): up $1.50 at $656.30
ASIA
The Nikkei surged to a seven-year high as shares rose across the region on signs that economic growth in Japan and South Korea is gathering pace.
More on Asian markets here
Samsung, South Korea’s biggest exporter, led the Kospi index - the world’s best performer this month - to a fourth successive high after the commerce ministry raised its forecast for South Korean exports.
BHP Billiton, Australia’s largest oil explorer, climbed for an eighth consecutive day as crude traded at close to a ten-month high. And in Japan, Komatsu, the second biggest maker of earthmoving equipment, gained after a report showed that machinery orders rose at triple the expected rate.
The Morgan Stanley Capital International Asia-Pacific Index was up 0.6 per cent while the Nikkei had added 0.6 per cent in intraday trading.
WHILE YOU WERE AWAY . . .
LAST MONDAY: The FSA gave warning that gangs of organised criminals may be infiltrating the mergers and acquisitions departments of British investment banks to garner inside information on takeover bids.
More here
Och-Ziff Capital Management, the hedge fund giant that helped to finance Malcolm Glazer’s takeover of Manchester United, unveiled plans for a $2 billion float on the New York Stock Exchange.
More here
TUESDAY: Hilton Hotels Corporation, the American hotels behemoth, received an approach worth $26 billion (£12.9 billion) from Blackstone, the American private equity firm.
More here
Kohlberg Kravis Roberts, the private equity firm, announced that it plans to raise about $1.25 billion (£619 million) though a flotation on the New York Stock Exchange.
More here
WEDNESDAY: O2 won exclusive UK rights to offer Apple’s iPhone in the mobile phone industry’s most sought-after deal in years.
More here
A Bill passed by the lower house of Russia’s parliament opened the way for Gazprom, the gas utility, and Transneft, the state oil pipeline monopoly, to create armed units to defend their installations.
More here
THURSDAY: The Times reported that Shell is preparing its biggest exploration programme in the Arctic Ocean off Alaska for more than a decade.
More here
Peter Wuffli, chief executive of UBS, left the Swiss bank abruptly after being turned down for the chairman’s job despite the recommendation of the incumbent, Marcel Ospel.
More here
FRIDAY: The Takeover Panel told Akzo Nobel that it must make a firm offer for ICI by August 9 or abandon its efforts to acquire the British paints and adhesives company.
More here
EADS’s main private sector shareholders agree in principle to a single management structure in which Tom Enders, the German co-chief executive officer, would head the company.
More here
Paul Larter
paul.larter@thetimes.co.uk
AGENDA
INTERIMS
None scheduled
FINALS
LitComp
Proventec
Spice
AGMs
Cellcast
Finsbury Worldwide Pharmaceutical
Immedia Broadcasting
Sefton Resources
EGMs
None scheduled
TRADING STATEMENT
Bovis Homes Group
Taylor Nelson Sofres
ECONOMICS
UK June PPI (0930 BST)
Keep up with news and comment throughout the day on http://business.timesonline.co.uk/