The Business Matrix: Friday 19 August 2011

Stocks plunge as gloom deepens

The US stock market fell by 3.68 per cent last night as investors’ gloom about the prospects for the world economy triggered more turmoil on global stock markets. Worries about European banks’ funding and a return to recession in Europe and America led to a drop of 4.5 per cent in UK markets and 6 per cent in Germany. MORE

Ofgem asks for clarity over bills

The energy regulator Ofgem has demanded that suppliers explain how they calculate bills amid allegations that customers have been overcharged following price rises. Ofgem has received complaints that when a bill covers a period in which prices increase, suppliers have incorrectly calculated the number of units consumed at the higher rate.

London weighting helps Savills

Half-year profits have surged at upmarket estate agent Savills thanks to a resilient London property market, although the economic turbulence is having an impact elsewhere. Savills said prime London properties – where the average deal rose to £2.8m – were a safe haven for investors. UK transactions were down 16 per cent outside the capital.

Foster’s opposes SABMiller bid

The Australian brewer Foster’s has urged investors to reject an A$9.5bn (£6bn) offer from SABMiller, saying it significantly undervalued the company. SABMiller said on Wednesday it would go directly to Foster’s shareholders with a A$4.90 a share offer. Shares in Foster’s hit A$5 yesterday amid expectations of a higher bid.

Magazine digests jump in readers

Reader’s Digest increased its circulation by 9 per cent to 440,419 between January and June, according to the latest ABC figures. Circulation grew 2 per cent compared with a year earlier. Gill Hudson, editor-in-chief, said: “We have completely reinvented the magazine for the 21st century and it has gone down a storm.”

Court date over Exxon oil leases

The US Government and the country’s largest oil company are heading for a court showdown over rights to one of the Gulf of Mexico’s largest oil finds. Exxon-Mobil had three leases on drilling rights to an oil field worth billions of dollars, but they expired in 2008 and the government unexpectedly refused to renew them.

Hannover Re puts faith in CGI

The specialist church insurer Congregational & General Insurance has sold a majority share of its subsidiary MGA, Integra Insurance Solutions, to Hannover Re. The group, which will still manage Integra, said the move is part of plans to grow Integra’s share of the intermediary home market to £100m over five years.

Mapfre push into car warranties

Mapfre has started a push into the car warranty business with the launch of the Mapfre Warranty brand. The Spanish company, which will use existing underwriting and claims operations in Bristol, already provides warranty products in the UK but now wants a presence in the sector under its own name.

June mortgage revival peters out

A mini revival in the mortgage market fell away during July in a “subdued” property sector, the Council for Mortgage Lenders said. Gross lending was estimated at £12.6bn, down 6 per cent on a year ago. Lending in June hit its highest level in nearly a year as activity in the buy-to-let market picked up.

‘Second round of QE not needed’

Britain’s economy is likely to expand by more in the third quarter than it did in the second three months of the year, and a second round of quantitative easing is not needed now because of high inflation, the Bank of England policymaker Martin Weale told BBC Radio Scotland yesterday.