NEW! Investment Companies Centre

Wednesday newspaper round-up: Cable & Wireless, British Energy, British Airways

Related Companies

Related Indices

Related Sectors

News for Spread Betters

PreviousPrevious
NextNext

There's a new Investor Edition of CMC Markets' spread betting platform... and it's exclusive to DigitalLook.com users...

Get full details about Marketmaker:Investor Edition here. Advertisement

Date: Wednesday 16 Jul 2008

LONDON (ShareCast) - Cable & Wireless, the FTSE 100 telecoms group, is poised to make a landmark decision on whether to offload about £1bn of risks associated with its pensions scheme, The Times has learnt.

It is understood that pension trustees at C&W, who walked away from a similar deal this year because of volatile markets, plan to meet next week to consider revised proposals.

A successful £11bn-£12.6bn takeover of British Energy by French group EdF appeared to move a step closer after the nuclear group drafted in an independent financial adviser to work on the deal. British Energy has appointed investment banking boutique Gleacher Shacklock to act as a "rule 3" adviser, according to sources, reports the Telegraph.

Europe's largest aerospace company, EADS, would consider shifting operations to Brazil or Mexico as well as North Africa as part of a desperate attempt to move away from the eurozone. The strength of the euro, which touched a record high against the dollar of 1.60 yesterday, is having a huge impact on EADS. The company owns Airbus, and its aircraft are priced in dollars, reports the Telegraph.

Ben Bernanke highlighted the “numerous difficulties” facing the US economy in a sobering testimony on Tuesday that sent markets on a rollercoaster ride as he signalled serious risks on both the growth and inflation fronts. The Federal Reserve chairman told Congress that strains in financial markets, declining house prices, a weaker labour market and higher oil prices were all putting pressure on the outlook, reports the FT.

Equitable Life policyholders will have to wait at least until the autumn to find out if the government will bow to calls from the parliamentary ombudsman to compensate more than 1m policyholders who lost billions of pounds in the mutual’s crisis. Alistair Darling, chancellor, has ordered lawyers to pore over the ombudsman’s report and is expected to wait until the House of Commons returns from its summer break before giving any view on compensation claims, reports the FT.

Meanwhile, Alistair Darling reiterated government pleas for pay restraint yesterday, warning workers against the consequences of demanding inflation-busting wage deals as the cost of living soars. As startling official figures showed headline inflation surging to its highest rate in 15 years, reaching 3.8% last month, the Chancellor cautioned that excessive pay awards would drive inflation still higher, threatening to trigger interest rate increases, writes the Times.

Premier Foods has warned that British food prices could rise another 8% over the next year as commodity costs continue to soar. In a trading update yesterday, chief executive Robert Schofield said the higher costs were likely to be passed on by retailers to consumers. Although milk prices have fallen recently, other commodities - including navy beans (used to make baked beans), soya and maize - remain at or near record highs, reports the FT.

The chief executive of British Airways said yesterday that fares were likely to increase by at least 4% because the airline would have to spend an extra £1bn on fuel this year. Willie Walsh, the BA chief executive, said that fare increases were inevitable because soaring fuel costs were contributing to the toughest environment the airline had faced. BA's fuel bill this year will exceed £3bn, reports the Times.

Mortgage lenders called on the Government yesterday to adopt new mortgage funding strategies in an attempt to restart the failing market.In a proposal submitted to the Treasury, the Council of Mortgage Lenders (CML) urged the Government to act to "break the logjam in the housing and mortgage markets and to underpin confidence" by breathing new life into mortgage funding via UK residential mortgage-backed securities and covered bonds, writes the Independent.

US regulators will take emergency action to stop abusive short-selling of stock in financial institutions such as mortgage financiers Fannie Mae and Freddie Mac and investment bank Lehman Brothers. Christopher Cox, Securities and Exchange Commission chairman, told legislators yesterday that the agency would issue an emergency rule to stop so-called "naked" short-selling of shares in significant financial entities. The SEC will also consider new rules to extend those trading limits to the rest of the market, reports the FT.

Digital Look have been voted
"Best Research and Information Provider"

4th Floor, Bankside House, 107 Leadenhall Street, London EC3A 4AF.
Registered in England and Wales (registered no. 3678570).