More turmoil on stock markets
The world’s stock markets suffered another day of volatility amid concerns about the European sovereign debt crisis and the slowing pace of the US economic recovery. The FTSE 100 lost another 2.7 per cent, taking its losses to almost 10 per cent for the week, though the US rose in early trading on better economic data. MORE
Logica hit by public sector cuts
First-half profits at Logica, the IT services company, fell as it suffered from cuts in public sector spending in the UK and Netherlands. The Anglo-Dutch company was particularly badly hit by cuts to government spending in the Netherlands, as its pre-tax profits tanked by 13 per cent to £75m over the six months to 30 June.
Rising costs hit Premier profits
Premier Foods, the maker of Hovis bread, blamed a “significant” spike in costs, a dispute with Tesco over price and the “underperformance” of its chilled foods for a 28.7 per cent fall in its half-year profits to £67m. The maker of Bisto gravy also blamed the consumer downturn for a 0.9 per cent fall in total half-year sales to £974m.
Coventry rules out bid for bank
Coventry Building Society has ruled out a bid for the troubled bank Northern Rock, as it posted record first-half profits. The UK’s third-largest building society lifted pre-tax profits by 10 per cent to £51.1m. But on a potential bid for Northern Rock, it concluded that it “would not be in the interest of our members at this time”.
Fewers shoppers on the high street
Footfall data for July provided further evidence of the pressure the consumer downturn is placing on retailers. Experian Footfall said the number of visitors to UK shops fell by 2.2 per cent last month, compared with July 2010, as high petrol prices and financial woes kept shoppers away.
Knees up for Smith & Nephew
Demand for its replacement knees helped the medical devices maker Smith & Nephew gain share from rivals in a flat orthopaedics market, although pricing pressure and more sales of lower-margin products both affected earnings. The company posted a second-quarter trading profit of $236m (£144m).
Property prices inch up in July
House prices in the UK edged up by 0.3 per cent in July but remain under pressure as consumers face the economic headwinds of market turmoil, low wage growth and Government spending cuts. The average price hit £163,981 in July, according to the Halifax, but remains 2.6 per cent lower than last year.
Prudential gets boost from Asia
The insurer Prudential has posted a strong increase in its half-year profits and dividend, boosted by its growth in the fastgrowing markets of south-east Asia. Prudential’s operating profit rose by 25 per cent to £1.06bn over the six months to 30 June and the insurer raised its dividend 20 per cent to 7.95p.
Company failures rise in last quarter
The number of English and Welsh firms collapsing into administration rose by 4.4 per cent in the second quarter, as they struggled to compete in the dire economic conditions. The latest statistics from the Insolvency Service said 4,233 companies were put into liquidation between April and June.
Old Mutual’s IPO could be delayed
Old Mutual, the Anglo-South African insurer, might have to delay plans to float its US asset management business owing to the turbulence in global stock markets. The insurer said the IPO was now unlikely to happen before the end of next year, as its pre-tax profits rose by 15 per cent to £845m over the first half.