The Bank of England has announced that they are to inject a further £25 billion into the UK economy. The move is seen as an almost desperate bid to drag the economy reluctantly out its longest recession on record, after the announcement last week that the UK economy had shrank 0.4% in the third quarter. The BOE’s gesture extends the quantitative easing programme to a total of £200 billion, meaning 14% of UK’s gross domestic product (GDP). The £25 billion will be released over the next three months.

According to that perennial bearer of bad news, the International Monetary Fund (IMF), sweeping spending cuts and tax increases will be required across the industrialised world over the next decade in order to bring public finances under control following the economic crisis, The IMF projected that on current trends, even assuming some discretionary fiscal tightening next year, government debt in the advanced G20 economies would reach 118 per cent of gross domestic product in 2014.

As pressure mounts across the banking industry to cut costs, HSBC have announced that is to pay off another four per cent of their UK workforce The job cuts would affect around 1,700 HSBC staff involved in back-office functions, and would come into effect over the next 12 to 18 months, and would mostly be lost from regional centres in southern England

Marks and Spencer have stepped into new territory with the announcement that they will begin to market branded goods at their stores across the UK.

This will mean the unfamiliar site of such household brands as Kellogg’s and Coca-Cola, appearing on the M&S’ shelves alongside their own label products. M&S have reported profits of £306.7 million for the six months to September, down just a smidgeon (£1.1 million) from the same period in 2008.

Makers of Silver Spoon sugar, Associated British Foods have reported a 12 percent rise in full-year group revenue. Their shares gained 5.5 pence to close on 833.

Meanwhile, Europe’s third-biggest airline, British Airways Plc is staring in the face of a cabin-crew strike, which could happen before the end of the year. The Unite union representing flight attendants are preparing to vote on a walkout on December 14th. On that less than encouraging news, stock in BA dropped 1 percent to 179.9 pence.

U.K. confectionary giant Cadbury Plc is said to be setting an unrealistically high price as their starting point for merger talks with Kraft Foods Inc. Reports have it that Kraft is preparing another bid for Cadbury which will be put to investors within the next 10 days, and Kraft will probably make a hostile takeover bid if Cadbury’s management doesn’t support a tie-up The uncertainty in the air caused Cadbury’s stock to fall 0.3 percent to 770.5 pence.

Dutch parcel firm TNT, busily trying to cash in on the disruption caused by the UK’s postal strikes have lobbied the government to allow it to launch a door-to-door postal service to challenge the strike-hit Royal Mail. The group has been testing out its own door-to-door letter deliveries in several UK areas. A spokesman for the company said that UK business-to-business parcel volumes had increased about 10 per cent in the last couple weeks since the strikes began, but added that the rise had come too late to affect the third quarter numbers, which, in any event were higher than expected.

General Motors (GM) have sensationally cancelled their plans to sell a majority stake in its European car business Opel, including its UK brand Vauxhall to Canadian car parts firm Magna.

The US giant announced that their board had made the decision because of "an improving business environment for GM over the past few months", as well as marking the importance of Opel and Vauxhall to their overall global strategy. Unions in Germany said workers would begin walk-outs from Thursday in protest at GM’s decision and the German government, who had backed the sale of Opel, demanded that GM repayment of a 1.5 billion Euro, (£1.3 billion) loan. British unions were reported to be delighted with the news of GM’s rapid reversal, in the hope that the move will result in increased protection of Vauxhall jobs in the UK

The pound recovered from early losses against the dollar on Thursday after the Bank of England extended its asset purchase plan, but by less than forecast.

• Pound/US dollar 1.6606
• Pound/Euro 1.1162
• Pound/Japanese Yen 150.6643
• Pound/Swiss Franc 1.6881

The London equity market took a decided upturn as news of an extension to the Bank of England’s economic stimulus measures broke. At close of trading, the FTSE 100 was up to 5,125.64.

The FTSE 250 limped back above the 9,000 point mark to close on 9,020.40

US shares have risen strongly over the last 24 hours on the news that US business productivity has risen at its highest rate for six years. Official figures showed that productivity, as measured by output per hour of work, rose at an annual rate of 9.5% between July and September.

The data suggests that the increase in productivity may lead to an increase in demand for staff.

The US Dow Jones index continued to make serious bounds forward closing on Thursday on me recoveries from the last two days trading; up 61 points to 10005.96. The NASDAQ also climbed, reaching 2105.32.

Billionaire Warren Buffett’s investment firm, in what is said to be their largest deal in their history, are to take control of the US’s second-biggest US railroad.

Berkshire Hathaway have agreed to buy the remaining 77.4% of Burlington Northern Santa Fe (BNSF) that it does not already own for about $26 billion (£16 billion), with the deal to be financed with cash and stock. .

Mr. Buffett proudly stated that the deal was "an all-in wager on the economic future of the United States and underlines his confidence in a coming rebound in domestic growth.

Gold held its price at almost $1,100 an ounce after hitting a record high in the previous session while oil prices dipped and base metals edged lower

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Tags: Associated British Foods, Bank, Bank of England, Banking, Berkshire Hathaway, BOE, British Airways Plc, British Economy, British Pound, Burlington Northern Santa Fe, Cadbury Plc, Coca-Cola, Currency, Dow Jones, Economy, Financial News, FTSE, General Motors, GM, HSBC, IMF, International Monetary Fund, Kellogg's, Kraft, Magna, Marks and Spencer, Money, Money Markets, NASDAQ, Opel, Recession, Retail, Royal Mail, Silver Spoon, Stock Markets, Stocks and shares, TNT, UK Banks, UK Economy, UK government, UK Recession, Vauxhall, Warren Buffett

As had been widely predicted, the UK Monetary Policy Committee has chosen to hold interest rates at 0.5 percent as well as continuing with the existing programme of buying £175 billion of assets. The Bank of England will have to decide in November whether to continue expanding its programme of money creation and asset purchases.

Two of Britain’s biggest banks, Lloyds Banking Group and Royal Bank of Scotland face what could be a crucial month for them. Their future will be laid bare as they hear around the end of the month what Neelie Kroes, the EU Competition Commissioner, has decided exactly what concessions Lloyds must make as it integrates HBOS as well as ruling on the amount of state aid that Lloyds and RBS have received and what actions to take regarding the aid. Shares in RBS closed yesterday at 49.65 pence, down on the 50.5 pence value when the government acquired its 70 per cent stake. Shares in Lloyds closed on 95.66 pence, a poor performance compared with the value of 122.6 pence that the shares were sitting on when the UK government acquired the shares.

Financial services firms showed the first signs of recovery in the last three months, after almost two years of falling business volumes and profitability, according to a recent survey. Business volumes across the financial sector have grown for the first time in two years, although the survey showed that levels of business were still considered to be well below normal. Firms are more optimistic about the overall business situation compared with three months ago, but they remain worried that a lack of demand will hamper business expansion in the coming months.

According to rankings published today by the World Economic Forum (WEF) London now wears the mantle of being the world’s leading financial centre having wrested New York from its traditional first place The WEF’s highly respected and influential Financial Development Report, which ranks 55 global financial centres said that London was in first place, a result that surprised many, especially the UK capital’s leading European rivals, in France and Germany, who have fallen out of the top 10 altogether

According to a recent survey, consumer morale in the UK has risen to its highest level since April 2008. In general, the UK public were reported to be at their most regarding the future than at any time since way back in 2005. The Nationwide Consumer Confidence Index rose to 71 in September from an upwardly revised 65 in August reflecting an improvement in Britons’ sentiment about their present circumstances, future prospects and willingness to spend. Another guide, the Nationwide Expectations index, which gauges public sentiment regarding the economy, jobs as well as personal own finances in a six months period ,also rose, to 106 in September from 97 in August,, This was the highest level that the index had reached since December 2005.

A spokesman for Jaguar/ Land Rover announced on Wednesday that that the company succeeded in securing a £175 million loan from the State Bank of India and were on track to receive their planned total of £500 million of new financing facilities for 2009. The car company, owned by India’s Tata Motors said it had “been making significant progress” in raising new loans despite its current loss making situation. In addition to the £175 million loan from India, the company has also added a £56 million export financing facility with ABC International Bank. Tata’s ability to line up new financing for their luxury brands is vital as they seek to curtail their losses, as well as reduce costs and revive sales.

The FTSE 100 continued to rise, this time by 16.74 points to close on 5154.64. The FTSE 250 is strengthening in leaps and bounds, closing up a further 147.09 points to close for the day on 9,373.44.

The pound continued its minor recovery against the leading currencies, creeping slightly over the $1.60 mark.

• Pound/US dollar 1.6073
• Pound/Euro 1.10875
• Pound/Japanese Yen 142.0389
• Pound/Swiss Franc 1.6489

The Dow Jones index came back strongly on yesterday’s trading, closing up 61.29 points to 9786.87, down 5.67 points. The NASDAQ index also continued its steady rise, up 13.6 points to close on 2,123.93.

Jeans maker Levi Strauss has reported a 41% drop in profits after seeing lower sales and currency fluctuations. The San Francisco-based firm saw its net income for the third quarter fall to £25 million ($41 million) on turnover down 6% to around £700 million, with sales falling in both in the US and across Europe.

The European Union has intervened by pledging that any job cuts and factory closures at either Opel and Vauxhall factories will not influenced by levels of state aid given to Magna, who are in the process of buying the firm. The UK, Spain, Poland and Belgium governments have stated their concerns that the planned takeover of GM’s Opel will favour German factories and jobs as the German government have offered Opel’s would-be buyer Magna a £4 billion (€4.5 billion) loan. Recent reports have suggested that if the deal goes through, Magna plan around 25% of their 45,000 workforce in Europe

Asian central banks, worried about the effect of the weak dollar on their export industries, are believed to have intervened in the global currency markets in an attempt to slow the slide of the US currency. According to foreign currency traders, central banks in South Korea, Taiwan, the Philippines and Thailand have been buying the US currency; the falling dollar has become a problem for many countries as signs of economic recovery begin to emerge, with traders rapidly switching from the traditionally "safe" US dollar to other currencies. The dollar fell to a 14-month low against a basket of currencies on Thursday and analysts now believe that if other economic forces have not intervened till now, they soon will.

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Tags: ABC International Bank, Bank, Bank of England, Banking, BOE, British Economy, British Pound, Credit Crunch, Currency, Dow Jones, Economy, EU Competition Commissioner, Financial Development Report, Financial News, FTSE, GM, HBos, Jaguar, Land Rover, Levi Strauss, Lloyds Banking Group, Magna, Money, Money Markets, NASDAQ, Nationwide Consumer Confidence Index, Neelie Kroes, Opel, Recession, Retail, Royal Bank of Scotland, State Bank of India, Stock Markets, Stocks and shares, Tata Motors, UK Banks, UK Economy, UK government, UK Monetary Policy Committee, UK Recession, Vauxhall, WEF, World Economic Forum

In a recent interview, Business Minister Lord Mandelson gave the first veiled indication of concern over the increasing number of Britain’s major businesses under foreign control. Mandelson pointed out that while the UK remained committed to open markets for trade and investment entailing that companies should remain open to foreign takeovers, whilst adding that the country should be "mindful" of the implications of foreign ownership

Mandelson’s comments appeared to signal a shift in the government’s open approach to takeovers by overseas firms and come amid a rising tide of protectionism around the world. In response to Mandelson’s comments, union leaders accused Lord Mandelson of "closing the stable door after the horse had bolted".

In his speech, Mandelson forecast that, foreign ownership could "disadvantage" the location of UK manufacturing plants over the next 20 years. His comments emphasised a growing concern as the government seeks to rebalance the economy and lessen the reliance on financial services.

Mandelson’s comments echoed those from City minister Paul Myners, who also has publicly expressed fears that too many British companies were falling into foreign hands because their shares are owned by international funds, and little concern was felt for their domestic heritage.

Britain has been a leading proponent of open markets and countless household names have been taken over by foreign companies. These include BAA, BOC, Marconi, Abbey National, Alliance & Leicester and British Energy.

Mandelson’s comments are bound to reverberate around the Vauxhall plants, fearing for their future after the car maker was bought by Canadian car parts firm Magna as well as at Cadburys where the American giant Kraft has attempted a hostile takeover.

When asked to comment on his speech Mandelson hastened to explain that while globalisation has served the UK well in the past and will do so in the future, there are issues around corporate institutional ownership and responsibility ". A major corporate buy-out by private equity can reshape a community or an industry, and there will always be a legitimate demand for transparency and accountability when that happens." He summed up.

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Tags: Abbey National, Alliance & Leicester, BAA, BOC, British Economy, British Energy, Cadburys, Credit Crunch, Economics, Economy, Financial News, Financial Services, Kraft, Lord Mandelson, Magna, Marconi, Paul Myners, Recession, UK Banks, UK companies, UK Economy, UK government, UK manufacturing, UK Recession, Vauxhall

The Bank of England have announced that they will be holding interest rates firm for the sixth consecutive month, at a record low of 0.5%.

The bank also announced that their quantitative easing program is not to be expanded, remaining at £175 billion.

The ownership saga at National Express seems to be drawing to a close, after the company reached an agreement to allow a consortium comprising its largest shareholder to examine its books. The next step is likely to be a £765 million takeover of the group, which operates both bus and rail networks in the UK. The successful bidders are a consortium headed by Spain’s Cosmen family, who already own 18.5 per cent of the group, private equity firm CVC Capital Group and Stagecoach who operate a similar facility in the UK. The consortium has apparently raised their cash offer to 500 pence per share from 450 pence, which had been magnanimously rejected by the board.

Shareholders in Cadbury are apparently not being coy, and are pressing Kraft to raise their takeover bid for the UK confectionery group and as soon as possible.

Reports have it that some of Cadbury’s principal shareholders are anxious to see the deal go through, as they are afraid to see any takeover become a long drawn out issue. A spokesman for one of Cadbury’s largest shareholders expressed their fears by saying: “The longer Kraft dithers, the more chance of a counter-bidder appearing on the scene."

On the FTSE, the U.K.’s third-largest oil and natural gas company, BG Group Plc, saw their share value rise by 3.8 percent after announcing that the Guara oil field, of which they hold 30 percent, has been found to contain between one to two billion barrels of oil.

Stock in the Hilton Food Group Plc climbed two percent, to 192.5 pence in anticipation of positive half year results. The U.K. meat-packer works with most leading supermarket chains including Tesco Plc. Home Retail Group Plc, owners of the Argos store chain is also scheduled to release their second quarter trading statement. The stock rose 0.6 percent, to 329.7 pence in anticipation of promising results. Not looking quite so promising was the outlook for Kesa Electricals Plc who owns the Comet appliance stores group. Their stock fell 0.9 percent to 151.6 pence pre-release of their first-quarter interim management statement

The FTSE 100 index failed to maintain its above 5,000 points status on a flat days trading on Thursday. The index closed down 16.62 points at 4,987.68

The FTSE 250’s rise was checked yesterday, with the index falling 11.34 points to close on 9,125.71

The pound rose against the Euro for the first time in almost a week, as well as continuing to improve against the dollar, and the other major currencies.

• Pound/US dollar 1.669
• Pound/Euro 1.1426
• Pound/Japanese Yen 152.8564
• Pound/Swiss Franc 1.7312

The Dow Jones Industrial Average continued to rise, up 70.29 points to 9617.51 while the NASDAQ Composite also rose by 20.31 points to close on 2080.7.

General Motors (GM) have finally reached a decision regarding the European based Opel and Vauxhall plants. As expected the successful bidder is the Canadian car parts manufacturer Magna

German Chancellor Angela Merkel was reported to be "very pleased" about GMs decision, especially as Magna, who are Russia’s Sberbank, has made it obvious that all four German plants will remain open.

However the long term future of Vauxhall and its 5,500 UK workers still remains uncertain.

Oil prices have risen above $72 a barrel following Opec’s decision not to change the amount of oil being produced by its members.

US light sweet crude rose 85 cents to $72.16 in Asian trading, as the euro continued to gain ground against the US dollar in currency markets.

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Tags: Angela Merkel, Argos, Bank, Bank of England, Banking, BG Group Plc, British Economy, British Pound, Cadbury, Currency, CVC Capital Group, Dow Jones, Economy, Employment, Financial News, FTSE, General Motors, Global Credit Crisis, Guara oil field, Hilton Food Group Plc, Interest Rates, Kesa Electricals Plc, Kraft, Magna, Money Markets, NASDAQ, National Express, Opel, Recession, Sberbank, Stagecoach, Stock Markets, Stocks and shares, Tesco, UK Banks, UK Economy, UK government, UK Recession, Vauxhall

How many hints do we need before the penny drops and the UK public can finally reach the conclusion that the recession is finally over? The latest one comes from the Institute of Chartered Accountants who in a report released last week announced that confidence among business professionals has surged form a negative status to a positive one. Based on their findings, the institute predicts the UK economy will grow by 0.5% in the third quarter of 2009, a reverse on the 0.8% negative growth that the UK economy recorded during the second quarter of the year.

UK building societies continue to be under scrutiny, with the news that possibly five of the largest could be amalgamating over the next couple of years. The number of building societies reporting losses for 2008 is reportedly causing concern in Whitehall, and the latest annual review of performance released shows that since the summer of 2008, seven mergers have already taken place, out of framework of 59 building societies.

Seven months after the U.K. government made a commitment to offer up to £2 billion of loan guarantees for car makers and their suppliers, agreements have yet to be signed. According to the Department for Business, Innovation and Skills, car makers and suppliers, the aid was offered as car sales collapsed during the recession, declining for 14 consecutive months through June.

The Thames Valley property market, once regarded as the UK’s equivalent to Silicon Valley, look to be heading for their lowest rental incomes on record, as the recession continues to hammer the technology industries.

On the FTSE yesterday rising metals prices pushed mining stocks. Kazakhmys led the sector, gaining 5.8 per cent to 980 pence, while compatriot ENRC was up 5.3 per cent to 896½ pence.

Punch Taverns added 4.1 per cent to 107½ pence on strong volume in anticipation a positive trading update due to be released this morning. Analysts announced that they expect trading in the company to have stabilised and that profit pressures are on the wane.

The FTSE 100 was up 0.9 per cent, rising 45.34 points to 4,896.23 for its highest close since early October.

Moving forward at the speed of an express train, the FTSE 250 increased by a further 1.76 % or 153.06 points to close on 8,831.89

Currency markets continued to remain stable on Monday’s trading

• Pound/US dollar 1.6409
• Pound/Euro 1.1481
• Pound/Japanese Yen 154.7475
• Pound/Swiss Franc 1.7419

US stocks slowed down after four sessions of gains on Monday after a warning over future bank losses saw the markets erase early gains.

The NASDAQ Composite index closed down a mere 2.92 points at 2,017.98, while the Dow Jones Industrial Average found fractional gains to 9,509.28

On Friday General Motors eventually postponed their much awaited decision on whether Canada’s Magna International would be the winning bidder for its Opel brand.

Magna, the world’s third largest auto parts manufacturer, in conjunction with the Savings Bank of the Russian Federation, who trade under the title Sberbank, had submitted a joint bid in July to acquire a 55 percent stake in Opel, the troubled financially strapped group’s European division. Brussels-based financial investor RHJ International is the rival bidder.

At their meeting Friday, GM’s board of directors failed to come to a decision whether to accept the winning bid by the Canadian auto company and the Russian bank.

This week French banks announced their intention to lead the way in offering to reinforce rules ¬governing the payment and disclosure of bonuses to their officials. In meetings with Nicolas Sarkozy, president, and Christine Lagarde, the finance minister, bank officials announced the concessions, which will strengthen a code on pay agreed by French banks in February, Designed to curb excessive risk-taking. The announcement, will be undoubtedly be used to bolster France’s position at the forthcoming G20 meeting to be held in Pittsburgh next month.

Oil prices have risen to 10-month highs on fresh signs that the global economic recovery is gathering pace.

US light crude ended Monday up 48 cents to $74.37 a barrel, while London’s Brent crude advanced seven cents to finish at $74.26

The rise came after official figures showed that new industrial orders in the 16 nations that use the Euro rose more than expected in June.

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Tags: Banking, British Economy, British Pound, Christine Lagarde, Currency, Department for Business Innovation and Skills, Economy, ENRC, Finance, Financial News, FTSE, G20, General Motors, Global Credit Crisis, GM, Institute of Chartered Accountants, Kazakhmys, Magna, Money, Money Markets, NASDAQ, Nicolas Sarkozy, Opel, Punch Taverns, Recession, Savings Bank of the Russian Federation, Silicon Valley, Stock Markets, U.K. government, UK Banks, UK Economy, UK Recession, US stocks