Recent research has show that close to 50 million pounds was paid out shareholders in the form of dividends, in many cases just a few days before the end of the tax year on April 6. Experts believe that many UK companies are employing this tactic as a means to help some of their big-income employees who are also shareholders to avoid the rise in the rate of income tax. If this is the case, it could cost the Treasury as much as £85 million pounds. Analysts estimate that the main "offenders" are directors in small to medium sized companies who want to minimise the effect of the soon to be effective 50 percent tax rate, due to their greater flexibility over returns.

A rise in UK retail sales, albeit a minor one has been reported for March by the Office for National Statistics (ONS) According to the ONS, retail sales volumes during the month grew by 0.4% from February, which is less than the 0.6% analysts had expected. Sales improved in February after a very poor January, report with retail sales being hard hit by the icy weather.

Overall, sales volumes during the first quarter of 2010 were reported to be down 1.7% from the equivalent quarter of last year.

Royal Bank of Scotland (RBS) has announced a series of proposals to toughen performance targets in its executive pay scheme. The announcement from RBS chairman Philip Hampton signals a key trigger point for RBS’s long-term incentive plan, which is to be revised upwards. Under the existing incentive plan bank executives gain a significant proportion of performance-linked rewards when the bank’s share price hits 50 pence. RBS shares are currently well over the fifty pence mark.

HSBC are reports to be on the look out for bankers to help them direct any industry-wide bank levy into government-sponsored venture capital agencies. The bank has toured Europe seeking support from colleagues in the industry for their plan to alter the terms of the ongoing debate about bank regulation. HSBC proposals include varying the capital buffers banks are required to hold, dependant on economic conditions. The bank’s argument is that banks need to hold higher capital in good times to absorb losses when conditions decline.

In an effort to strengthen confidence in its brand before a proposed launch onto the UK high street, the Bank of Ireland (BoI) that would have a spate and UK based board of directors. The UK move would also see BoI, which has operated in the UK in a partnership with Post Office since 2004, being regulated by the Financial Services Authority. Although the group has operated in the UK in various formats since the mid nineteen seventies, till now their operations have always been overseen by the Irish Financial Regulator, with customers protected through Ireland’s deposit guarantee scheme. In the meantime BoI have announced plans to raise £2.9 billion through a rights issue and private placing, in order to finance the expansion and meet its capital needs. The bank is in need to aid its recovery from the financial crisis due to the crash in the Eire economy which has been one of hardest hit, but has now emerged from what was one of Europe’s worst recessions. Irish lenders were particularly hit hard by the housing market crash, which saw billions of Euros-worth of home loans go bad.

UK Coal, Britain’s largest coal mining company, has announced 2009 losses of almost £130 million in what it describes as “an extremely challenging year for the group”.

Total demand fell to 7 million tonnes from 7.9 million in 2008, while the Group’s financial results revealed a pre-tax loss of £129.1 million, compared to a minor loss (£15.6 million) the previous year.

A spokesman for UK Coal commented that while the financial results for 2009 were poor, new contracts and developments to their property portfolio look set to help boost profitability in 2010, with the Group planning to disposal of land for agricultural use expected to help reduce its debt.

As the largest producer of coal in the country, last year UK Coal mined 15% of the total amount of coal burned in the UK.

For the third time in six months mobile phone retailer Carphone Warehouse have raised their full-year profit forecast.

A company spokesman has no predicted that they expect net profits for the year to the end of March to be around the £47 million mark, considerably more than the £40 million to £45 million predicted at the beginning of the year.

Strong growth due to the joint venture with US group Best Buy, cost cutting and strong sales of smart-phones were said to be the principal factors behind the profit growth.

Uncertainty regarding the Euro pushed Sterling up against the dollar while the Euro fell. The pound closed on $1.5263 and €1.580

On the FTSE, stocks plunged at the fasted rate for one day for five months after the economies of both Greece and Portugal were downgraded spurring concern that these heavily in debt European nations are moving closer to default. The index sank 150.33 to 5,603.52, its biggest drop since late November 2009.

Greece has become the first eurozone member to have its debt downgraded to junk level, while Portugal’s debt was also lowered on fears of "contagion", adding to the markets’ rout and a fall in the euro. The German government immediately came out with a statement that it would not "let Greece fall", and there were signs that an aid package could be increased.

Profits at oil giant BP have more than doubled from a year ago on the back of rising oil prices.

Profit for January to March was £3.6 billion, ($5.6 billion) compared with the around £1.45 for the first quarter of 2009 – a 135% rise.

The profit figure is also up on the profit made in the last three months of 2009.

BP has benefited from rising global oil prices, which averaged $76 a barrel in the first three months of 2010, compared to an average of $41 a barrel a year ago.

On the news of Greece’s possible default, shares on Wall Street fell sharply. The Dow Jones dropped 213.04 points to 10991, 99 while NASDAQ fell 51.48 points to 2471.47.

Car giant Ford has reported net income of $2.1 billion for the first three months of 2010, its highest quarterly profit for six years, and cancels out a a loss of $1.43 billion for the same period in 2009.

A spokesman for the company said the result was down to a recovering economy, which meant people were again beginning to buy expensive, one-off items.

Ford also predicted that it will remain in profit every quarter this year.

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Tags: Bank, Bank of Ireland, Banking, BP, British Economy, Carphone Warehouse, Dow Jones, Economy, Employment, Financial News, Ford, FTSE, HSBC, income tax, Irish Financial Regulator, Money, NASDAQ, Office for National Statistics, Post Office, Retail, Royal Bank of Scotland, Stocks and shares, Tax, UK Banks, UK Coal, UK Economy, UK government, UK Recession

The UK economy continues its recovery from recession, with the news that the UK gross domestic profit (GDP) rose by 0.2% in the first three months of 2010, according to information provided by the Office for National Statistics, The figure was lower than the 0.4% growth predicted by many economists, but like the last quarter of 2009 may still be revised. Initial figures for that period, when the UK moved out of recession were originally estimated at 0.1%, were later revised to 0.4%. The ONS estimated that bad weather at the beginning of the year may have had an impact on output, particularly in the retail and industrial sectors. Meanwhile it was reported that manufacturing output grew by 0.7% over the quarter, while the utilities sector output also rose by 2.5%.

It has been confirmed that UK Government borrowing hit a record high of £163.4 billion in 2009, whilst remaining lower than the £166.5 billion initially predicted by Chancellor Alistair Darling in his 2009 Budget.

Despite that fact the figure still makes for s the biggest annual borrowing figure for a UK Government in peacetime.

In March alone, the figures from the Office for National Statistics (ONS) showed total borrowing of £23.5 billion.

For the first time, bonus rates on save as you earn (SAYE) schemes are to be cut to zero percent next month. The news has fostered concerns that some employees could shun participation in SAYE plans because there will be less incentive to save.

A £1 billion profits boost looks to be on its way for the Lloyds Banking Group brought about a block in rises of the pensionable salary of its staff. This vital cost saving is expected to play a significant part in returning Lloyds to profit in 2010. The move will also increase the likelihood that the government will be in a position sell its 41 percent stake in the bank in the near future.

As part of their new chief executive Adam Crozier’s expansion plans, Broadcaster ITV is reported to be considering an acquisition of its rival Five Industry sources predict that Crozier will implement expansion plans as soon as possible, before the general consolidation in the sector. If the deal goes through it would give ITV a 53 percent share in the television advertising market.

Two of the UKs largest property investment trusts are to merge to create the sixth-biggest listed property company in the UK with a combined market capitalisation of more than £1.6 billion The F&C Commercial Property Trust (FCPT), are to be merged with the UK Commercial Property Trust (UKCPT) that is owned by the Phoenix Group.

The new company will have a market capitalisation of about £1.6 billion and a property portfolio with net assets of £1.5 billion.

British newspaper and stationery retailer WH Smith has announced a four percent drop in like-for-like sales for the six months to the end of February. WH have spent £35 million in the first half of the year repurchasing shares in a buy-back scheme that has seen their share price rise by ten percent and pre-tax profit rise two percent to £62 million A spokesperson for the group announced that they have decided against extending the buy-back programme, choosing instead to invest in acquisitions and to return cash to shareholders at the end of year. On the news shares in WH Smith closed down 9.5 pence at 505 pence.

Lord Kirkham, founder and chairman of furniture retailer DFS stands to make in excess of £300 million pounds from the sale of his company to private equity firm Advent International, who have purchased the company for £500 million Kirkham will, he will hold on to DFS Properties, which owns approximately one third of the group’s store estate.

Homebuilders were among the biggest gainers in London after the US Commerce Department reported that new home sales in the United States were up by 27 percent in March, the biggest monthly percentage gain in almost half a century. Taylor Wimpey who sells around a third of its properties in the US showed close to a 10% gain on the stock exchange, Barratt Developments was up 4.52 percent, Persimmon 3.81 percent and Bovis Homes 3.45 percent.

The travel and leisure sector also finished the session and the week on a high. Travel returning to normal after the recent closures of airports and airspace in Europe due to ash in the air from the volcanic eruption in Iceland having its effects.

Cruise ship operator Carnival led gains in the sector as it added 5.87 percent, while shares in hotels operator InterContinental Hotels Group rose up by 4.37 percent. British Airways gained 3.86 percent as fears of a protracted grounding were put to the side.

The pound closed against the dollar down .030 on 1.5358 while the Euro closed up to 1.1488

U.K. stocks advanced the most in three weeks before the weekend. Despite a smaller-than-forecast increase in British gross domestic product, prospects for global economic growth remained strong the benchmark FTSE 100 Index rose 58.32 to 5,723.65 on Friday the highest rise since April 1. The increase pared this week’s retreat to 0.4 percent.

Overall The FTSE 100 remains 5.7 percent higher for 2010.

In his weekly radio and Web address, President Barack Obama said on Saturday taxpayer-funded bailouts of the auto industry that he approved had paid off, in what amounted to a rejection of conservative arguments against such government help.

President Obama continues to apply pressure for an overhaul of U.S. financial regulations, saying the promising news from the auto industry had not reduced the need for Wall Street changes.

Government bailouts of Wall Street continue to come under heavy criticism from conservatives who feel the government is spending too much money and that big firms should be allowed to fail.

General Motors Co and Chrysler both reported progress this week in their government-financed turnarounds. However the Obama administration still forecasts some loss on the taxpayer bailout of both companies to help them recover from the economic slump and a steep drop in auto sales.

The Dow Jones Industrial Average closed for the weekend up 70 points to 11,204.29 while the NASDAQ Composite was up 21 points on 2,530.10

Reports are that Greece’s talks with the IMF on emergency loans to finance its debt are going well. The Greek finance minister George Papaconstantinou predicted that Greece would not face problems funding its debts. To tackle the crisis, which has undermined the Euro, Greece has called for emergency funding from the IMF as well as its Eurozone partners. The Eurozone nations are expected to provide emergency loans of up to €30 billion (£26 billion) in the first year, with a further €10 billion coming from the International Monetary Fund (IMF). Greece will need some of the money as soon as the 19th May, when it needs to make a debt payment of $11.3 billion.

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Tags: 2009 Budget, Adam Crozier, Advent International, Alistair Darling, Bank, Banking, Barratt Developments, Bovis Homes, British airways, British Economy, Carnival, Chrysler, Credit Crunch, DFS, Economics, Economy, Eurozone, F&C Commercial Property Trust, Financial News, FTSE, General Motors, George Papaconstantinou, InterContinental Hotels Group, ITV, Lloyds Banking Group, Lord Kirkham, Money, Money Markets, Mortgage, NASDAQ, Office for National Statistics, Phoenix Group, SAYE, Stock Markets, Taylor Wimpey, UK Banks, UK Commercial Property Trust, UK Economy, UK government, UK Recession, Wall Street, WH Smith

The International Monetary Fund (IMF) has stated that governments must act to curb the increasing power of banks in the aftermath of the financial crisis. The IMF has called for cooperation from governments to set out future financial regulatory reform agenda, whilst stressing that some of the "too-big-to-fail" institutions had been made even stronger by the financial crisis. The IMF went on to warn that the large government financed deficits run-up during the financial crisis could pose a risk of starting a second credit crunch.

Proposals from the IMF include imposing two new taxes on banks in order to raise funds to pay for potential future bailouts and to penalise excessive profit-making. UK Chancellor Alistair Darling was reported as having welcomed the proposal:

Recent reports show that the number of Britons buying a home for the first time fell to the lowest in almost two decades as tighter lending conditions curbed people’s ability to purchase property. Some 347,000 first-time buyers took out a home loan in the year through February, less than half the peak figure of 700,000 recorded in the period from 2004 to 2005. Reasons given largely include the bank’s policy of squeezing credit as they seek to rebuild their balance sheets To aid first-time buyers, the government last month scrapped a tax on house purchases for those spending less than £250,000 pounds ($384,000) which help a few buyers, However many don’t have the 25 percent deposit lenders that lenders now demand

Official data released on Wednesday showed that the number of people in the U.K. claiming jobless benefits has fallen further than anticipated in March. Overall unemployment rose above 2.5 million, reaching its highest level for more than 15 years. The data drew conflicting responses from the main parties ahead of the May 6 general elections. The Office for National Statistics said the number of people receiving jobseekers allowance fell 32,900 in March to 1.54 million, the fourth decline in five months.

Britain’s largest supermarket chain Tesco has announced plans to l create 16,000 jobs this year, after the company announced a 10 per cent rise in profits for 2009. Tesco pledged 9,000 new jobs for the UK as they confirmed pre-tax profits of £3.2 billion for the financial year to 27 February 2010. 2009

saw a record turnover of £56.9 billion for the retailer, which have now almost trebled in size over the past decade and currently employs 460,000 people in 14 countries. . The company’s non-food business generated £9 billion in UK revenues alone

In a bid to expand their share in Europe’s growing market for the auto rental service, the American company Zipcar Inc. has announced that they are to acquire UK car-sharing peer Streetcar Ltd. The acquisition, valued around $50 million, will give Zipcar a larger presence in the U.K., where Streetcar is the biggest car-sharing company,

Zipcar began operating in London in 2006 and has 12,000 U.K. members who pay a fee to rent cars by the hour or day while Wimbledon based Streetcar, based in Wimbledon, has 50,000 members in the U.K. Its revenue last year was about $25 million.

Online fashion retailer ASOS have announced that they anticipate profits of around £20 million pounds ($32.09 million) after an increase of turnover of around one third to £223 million for the year to the end of March. A spokesman for the company announced "another excellent year" and that ASOS are approaching this year with considerably more confidence."

Tui Travel announced that they have raised £500 million of fresh financing in anticipation of cash flow problems in the wake of travel disruption caused by the volcanic ash cloud. The holiday operator warned yesterday that it was losing up to six million pounds a day. A spokesman for the company said the new finance would be largely used to "exploit its strong pipeline of attractive acquisition opportunities". Analysts said the finance would also allow Tui Travel to partially repay a £600 million pound loan that they took from Tui AG, the German travel group who are majority shareholders in Tui Travel.

Sterling rose to a two-month high against the euro and advanced against the dollar on Thursday after the minutes of the Bank of England’s policy meeting earlier this month showed a more positive outlook. The pound closed against the dollar on 1.5388 while the Euro stood at 1.1157

London’s FTSE 100 failed to keep intraday gains on Wednesday as a recovery rally among banks faded coupled with concerns about the potential impact of the disruption caused by the volcanic eruption in Iceland on the recovering economy.

London’s benchmark index fell 62 points, to 5,665.33, turning round from modest opening gains as financial stocks joined resource companies at the bottom of the market.

US President Barack Obama has again attacked critics of his banking reforms. In a speech which warned that without change the financial crisis will be repeated, Obama pointed out that reckless practices and financial firms that acted like "bandits" should never be allowed to operate again.

Regulatory reform was in the financial sector’s interests, the president said adding that "bankers and lobbyists should not fight against it ".

President Obama made his speech to an audience of bankers and financial experts in New York

US stock prices dropped on Thursday after rising on Wednesday morning, boosted by earnings results from Apple that smashed analyst expectations, with Morgan Stanley and Boeing also posting higher than anticipated first-quarter figures. The Dow Jones Industrial Average closed on 11,134.29 while the Nasdaq Composite was up on 2,509.10.

Apple led the technology stocks in the Dow higher, rising 6.3 per cent as the company reported a 90 per cent increase in second-quarter profit and a 49 per cent increase in revenue after the session’s close on Tuesday, far surpassing analysts’ estimates. The consumer technology products group had been expected to record sales of around $12 billion; instead, it reported sales of $13.5 billion in the first quarter.

Software giants Microsoft announced a profits leap by 35% in the first three months of 2010, largely due to the continued success of their Windows 7 operating system. Microsoft’s net profits for the quarter of £2.6 billion ($4 billion) were also attributed to "strong growth" from its Bing search engine business and XBox Live. Sales hit a record $14.5 billion, up 6% on the same period in 2009.

Doing less well were Yahoo, whose share dropped by almost five percent as the search engine provider forecast lower-than-expected second-quarter sales citing losing market share.

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Tags: Alistair Darling, Apple, ASOS, Bank, Bank of England, Banking, Bing, Boeing, British Economy, British Pound, Dow Jones, Economics, Employment, Financial News, FTSE, International Monetary Fund, Microsoft, Morgan Stanley, Office for National Statistics, Retail, Streetcar Ltd, Tesco, UK Banks, UK Economy, UK government, Unemployment, Windows 7, Xbox Live, Zipcar Inc

Continued uncertainty regarding cash-strapped Greece’s ability to be granted loans from their Eurozone partners, and if they are granted them if they will agree to accept them, continues to cause uncertainty in both the currency markets and stock exchanges not only in the UK but in all of the Eurozone member countries. Recent reports coming out of Athens have stated that Greece is lacking in confidence that their partners in Europe are either willing or able to provide sufficient and timely aid, and that they may have no option but to turn to the International Monetary Fund (IMF) for a bail out. The principal stumbling block to the EU loan is Angela Merkel, the German chancellor who HAS repeatedly stated that any other form of loan agreement would be impossible in terms of the European Union’s Maastricht treaty and German constitutional law. Berlin has shared widespread EU hostility towards any involvement of the fund, fearing that such a move would demonstrate Europe’s inability to regulate its own economic and monetary union.

After the release of more positive figures for February and the revision of data for January, it begins to appear that UK government borrowing for 2010 could be less than forecast. According to official figures, government borrowing for February was £12.4, much less than economists had expected.

Borrowing figures for January were also reviewed and sharply downwards, to £43 million from £4.3 billion.

Analysts now predict that UK’s full-year borrowing total may work out a lot less than the government’s original £178 billion forecast.

The Office for National Statistics also announced that the overall effect of the latest revisions to historical data for the year had cut overall borrowing for 2009/10 by £2.9 billion.

The Co-operative which traces its roots to the founding of the co-operative movement in 1844 has reported a major profits surge in its banking division, on the back of thousands of bank account customers disillusioned with Britain’s big banks switching their allegiance to the "co". In addition, the acquisition of the Somerfield supermarket chain coupled with the merger of the Cooperative’s financial services arm with Britannia Building Society have provided a major boost in turnover and profit for the company. As part of a revised tradition, the Co-op will be paying their five million members- a dividend of £55 million, up 16% from 2008. The dividend scheme or "divi" as it is widely known was re-introduced by the group in 2006 after a break of 30 years. The Coop’s banking division reported a 38% jump in new current or 140,000 new customers, taking the total to 1.2 million. The increase effectively doubled their share of the current account market to reach 4%.

To scenes of great excitement, Japanese care manufacturer Nissan have announced that they are to build its new electric car, to be known as the Leaf, at their UK plant in Sunderland. Once production begins in 2013, it will mean that hundreds of jobs are expected to be safeguarded as part of the company’s £420 million investment in electric cars. Nissan’s investment will be backed by a £20.7 million government grant and up to £220 million from the European Investment Bank. About 50,000 Nissan Leaf hatchbacks, which will run entirely on lithium-ion batteries, will roll off the Sunderland production line each year. Business Secretary Lord Mandelson said the development was a "fantastic vote of confidence" in the plant and its "excellent workforce". Mandelson also confirmed the UK government will be providing £360 million in loan guarantees for Ford’s planned £1.5 billion investment in cleaner engines.

At a hearing of the Commons business, innovation and skills committee held on Tuesday, representatives of Kraft Foods made a commitment not to close any more Cadbury factories in the UK or make compulsory redundancies in its domestic manufacturing operations for at least two years, The promises came as Kraft were seen trying to placate furious MPs and union members over its broken promise to save a Bristol factory from closure.

The US food group came under heavy fire for reneging on a pledge made last September to keep open the Somerdale factory, near Bristol, within days of agreeing an £11.7 billion take¬over of Cadbury in January, having overcome hostility from the UK-based maker some of the UK’s favorite chocolates.

On the FTSE, the Royal Bank of Scotland Group Plc had a bad day, their shares dropped by more than 3 percent as the biggest government-controlled bank issued warnings that their £2.9 billion pound ($4.45 billion) pension deficit looks likely to rise. The bank today reported a 46 percent rise in its pension deficit. .

Sterling fell to $1.5229, with the Euro coming under heavy pressure at €1.1181

The FTSE 100 jumped 17 points to close on 5,642.62.

According to official figures US consumer prices have risen very little between January and February.

The report issued by the US Labor Department showed the consumer price index was flat in February, though prices were 2.1% higher than a year ago , indicating that there were little sign of inflationary pressures in the offing for the US economy, allowing interest rates to remain low.

US stocks closed modestly higher on Thursday, aided by some strong corporate results. At close of trade the Dow Jones Industrial Average was up 0.4 per cent at 10,779.17 and the NASDAQ Composite index rose 0.1 per cent at 2,391.28.

Crude oil prices have fallen to an average of $81.85 a barrel, yet still placing them within levels are within Opec’s preferred price band of about $75-85 a barrel. The cartel reasons prices below that band risk choking off investment in new oil projects while prices above it could threaten the recovery of world economies

The fall came after the OPEC oil cartel announced on Wednesday their intention to hold production quotas at the same level for the time being.

The price of gold rose 0.1 per cent to $1,126 a troy ounce after ending Wednesday’s session in New York at $1,124.05.

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Tags: Angela Merkel, Bank, Banking, British Economy, Cadbury, Credit Crunch, Dow Jones, Economics, Economy, electric car, Employment, Financial News, FTSE, Gold, International Monetary Fund, Kraft Foods, Lord Mandelson, Money, NASDAQ, Nissan, Office for National Statistics, OPEC, Recession, Retail, Royal Bank of Scotland, Somerfield, Stock Markets, Stocks and shares, The Co-operative, UK Banks, UK Economy, UK government, UK Recession, US labor Department

According to a recent statement from the Office for National Statistics, the state of public finances in the UK, are even worse than that of Greece. The latest figures on government borrowing show that in January there was a net shortfall of £4.3 billion, which is much higher than even the most pessimistic of forecasts. January is traditionally the month where a healthy balance of payments is the norm. If the trend continues, the UK will be looking at a deficit of £180 billion for 2010, equivalent to 12.8 per cent of GDP, which will even beat Greece into second place in the "whose going skint fastest" race.

The reasons given for the UK’s poor performance included considerably reduced earnings in the financial sector as well as general weaknesses in the economy. These factors combined to push cash receipts down by 9 per cent overall compared with last year tax, while public spending was up by 15 per cent up in January, driven higher by the rise in unemployment benefits.

The only positive piece of news coming out of the report was that the total national debt carried by Britain remains lower than Greece as well as the fellow financially challenged European countries, Portugal, Italy, Ireland, and Spain.

HSBC have announced a 24 per cent fall in profits for 2009. Their profits fell to £4.65 billion ($7.1 billion) with the main factor being increased loan impairment charges, which largely cancelled out the bank’s strong investment banking performance. Undeterred, HSBC have announced that they would be paying out a total of £4.6 billion in pay and bonuses to staff at their profit earning investment banking division. HSBC shares fell almost 6 per cent to 679 pence on the news.

After months of speculation, retailer to the upper echelons Liberty, have finally confirmed their plans for the sale and leaseback of their landmark mock-Tudor flagship store situated on Great Marlborough Street in London’s West End. The company, which was founded in 1876, and are partially owned by the MWB Group, announced that they had issued instructions to put the building up for sale, and it is expected to fetch around £40 million. A few of the London based property owners are believed to be interested in acquiring the property for lease back to Liberty, but are likely to face strong competition from overseas. A spokesman for Liberty announced that that turnover for the store in 2009 had jumped by 16 per cent.

Despite winning the Carling Cup Final at the weekend, all is not well at Manchester United, but not on the playing field, instead in the boardroom.

The problem is that United, owned by the Glazer family, are running a very high level of debt, some £716.5 million, a fact that has caused much discomfort and loads of speculation among their huge band of supporters. So much so that a group of city financiers, under the title the "Red Knights" have met to discuss the feasibility of setting up what will be a possible hostile takeover of the club. An immediate response from the Glazers was that Manchester United is not for sale."

However, it may not be that easy, as United’s owners are facing a two-pronged attack over their control of the club with the Manchester United Supporters’ Trust (Must) running a campaign to bring about a change of ownership, which might even involve fans boycotting the clubs matches, and with a 76,000 seater stadium to fill, that may well be too bitter a pill for the Glazers to absorb.

The fact that the British general election appears to be getting closer and is now expected in May is having a very negative effect on Sterling. The currency took another pounding on foreign exchange markets, with the possibility that the election may bring of a hung parliament looking an increasing possibility. The uncertainty has caused the pound to drop nearly four cents, reaching a low of $1.4984 at one point before rallying to close $1.5056. The pound also closed at 1.1044 against the Euro.

On the FTSE 100 supermarket chain Tesco were among the FTSE 100’s top performers as America’s second-richest man Warren Buffett raised his stake in the company. Share values rose by 3.2 per cent to 433 pence, after Mr Buffett announced to his Berkshire Hathaway shareholders that their holding had increased to 3 per cent. Berkshire Hathaway has been gradually raising their stockholding in Tesco since 2006 when the retailer announced their plans to enter the US market. Since making their first stock purchase, the American conglomerate is believed to have become Tesco’s sixth largest shareholder.

As the markets closed for the day, the FTSE 100 was up 134 points to 5,484.06.

According to Lawrence Summers, head of the White House National Economic Council, the impact of Barack Obama’s $800 billion fiscal stimulus is yet to be fully felt, and its impact will increasingly be sensed over the coming months. Summers has praised the fiscal stimulus as being an enormous achievement and the many projects that the stimulus funded throughout the country are running exactly as planned.

On Wall Street, the Dow Jones Industrial Average continued to creep upwards. It rose 80 points to close on 10,405.98 while the NASDAQ Composite jumped by 42 points to close on 2,280.79.

According to date from the Bureau for Economic Policy Analysis (BEPA), global trade in goods has continued its rapid recovery from its huge fall in 2009, when the recession was at its peak. Data from BEPA also indicate that the world trading system suffered very little permanent damage to global trade has been done to by the financial crisis. The bureau’s composite index reported that the volume of goods trade worldwide rose at 4.8 per cent in December, making for the most rapid monthly increase in December for any year in its 19-year history, with three monthly index, traditionally less volatile, also rising by a record rate in the fourth quarter of last year, finishing six percent higher than third quarter.

On the other side of the World, things are looking better. So much better that for the fourth time since October, Australia’s central bank has seen fit to raise their interest rates, as it seeks to cool its growing economy.

The increase, from 3.75%, to 4% was widely expected by economists.

Australia was not only the only major economy to avoid recession, but also the first to raise interest rates from half century lows as the economic crisis eased. Australia’s ability to avoid the worst of the global turndown was partially attributed to increased demand for its commodities from China.

However Australia’s boom times may be slowing down with the news that China’s manufacturing activity shrunk a little in February. However economists rushed to point out that while China’s recovery faced some flat periods, it was expected that industrial activity would continue to grow in the coming months.

After the massive earthquake that struck Chile, copper prices jumped more than five per cent on early trading on Monday. Chile is the world’s largest producer of the red metal, and the earthquake has severely disrupted mining operations in the country, consequently triggering a spree of panic buying in the major commodity centres.

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Tags: Bank, Banking, Barack Obama, British Economy, British Pound, Bureau for Economic Policy Analysis, Carling Cup Final, Credit Crunch, Dow Jones, Economics, Economy, Financial News, FTSE, Glazer family, HSBC, Lawrence Summers, Manchester United, Money, Money Management, Money Markets, MWB Group, NASDAQ, Office for National Statistics, Stocks and shares, Tesco, UK Economy, UK government, UK Recession, Wall Street, Warren Buffett, White House National Economic Council

After a nine-month run of steady increases, UK house prices were reported to have fallen in February, while the three-month rate registered a rise of 1.6 per cent. The three month property rise comparison chart was down from the 2 per cent increase seen in the three months to January as well as its peak of 3.7 per cent the three months to September 2009. According to the, prices fell by 1.0 per cent month on month in February,, although on a year on year level, house prices rose by 9.2 per cent against 8.6 per cent in January.

It now transpires that Britain’s escape from recession was stronger than previously thought in the final three months of last year, as the services sector bounced back.

According to the Office for National Statistics, the UK economy grew by 0.3% in the fourth quarter, rather than 0.1% as previously estimated, which marked the first time the economy had grown since the first quarter of 2008, when the UK’s deepest and longest postwar recession on record began.

City economists, who had predicted 0.2% growth, hastened to point out that the figures did not change the overall economic picture; with some of them even warning that the economy could even slip back into recession in the first three months of this year.

Before the weekend, the extent of the beating that the Lloyds Banking Group took through the acquisition of HBOS was revealed. The bank, who are partially owned by the UK public, revealed that no less than £30 billion had been set aside over the past two years to cover toxic debt hat Lloyds had inherited from the deal, with the bank indicating that they expect a further £12 billion of charges on HBOS loans this year, showing what a white elephant the bank had purchased for what then appeared to be a bargain price of £8 billion.

All these negative figures contributed to Lloyds announcing a worse-than-expected pre-tax loss of £6.3 billion for 2009. The figures make a somber contrast to those of Barclays and Royal Bank of Scotland who over the last ten days announced figures that beat market projections. Lloyds also came under a lot of stick over the issue of whether it had met lending targets agreed with the UK government.

Understandably shares in the bank fell heavily after having increased by 18 per cent in the previous nine days on what proved to be false optimism about its 2009 figures. In the event, Lloyd’s report of a series of unexpected bad debts for the fourth quarter sent their shares falling by 4.4 per cent to 52½ pence. Royal Bank of Scotland shares also faded 1.9 per cent to 37½ pence after analysts reduced their ratings which they claimed painted a too optimistic picture.

Financially troubled US insurer AIG are apparently on the brink of selling AIA, the US life group’s Asian business, to the UK’s largest insurer Prudential for about $35 billion in cash, shares and other securities The is deal expected to become official on Monday 1st March. The announcement will come after a weekend of talks, after which the AIG board decided to press ahead with the sale of AIA, one of the jewels in AIG’s crown, in preference to a planned partial listing of the unit. Under the terms supposedly being discussed, Prudential would pay about $25 billion in cash and the remaining $10 billion in shares and other securities for AIA. If the deal does go through, analysts prophesy that it would transfer would more than double the size of Prudential and mean that its business would be dominated by Asian sales and profits.

The UK’s oldest building society Chesham has agreed to merge with the Skipton Building Society, to create a mutual society with more than £15 billion. The merger brings to an end 165 years of high street presence for the society, although their name will continue to be used for the society’s existing share accounts and deposit accounts of assets. A spokesman for Chesham, who service over 20,000 members from their three branches, welcomed the merger, saying it would provide the security of being part of a larger group. In the past year Skipton Building Society, has seen annual profits increase to £63.5 million

According to a recent survey, the cost of car insurance jumped 12.7 percent in Britain in 2009 with the average quoted premium rising to £507 at the end of 2009 compared with £450 pounds a year earlier, The pace of the increase accelerated in the second half of the year, with prices rising by 6.3 percent in the final quarter alone. British car insurance prices have been held in check by stiff competition between providers, largely due to the spread of price comparison websites.

Write-offs at their troubled T-Mobile UK subsidiary helped to pushed Deutsche Telekom’s profits down by 77% in 2009, with profit slipping to €353 million from €1.5 billion in 2008, due to write-offs worth €2.3 billion on goodwill in T-Mobile. Deutsche Telekom and France Telecom have agreed to merge their UK mobile operations. They are awaiting regulatory approval for the deal, which will make the jointly-owned company the biggest UK mobile network operator with some 29.5 million subscribers.

Portsmouth Football Club have lost their battle to avoid entering administration as the Premier League side finally admitted defeat in their struggle to overcome a mountain of debt totalling £60 million, of which – g more than £12 million is owed to HM Revenue and Customs.

The process of administration automatically means that the club will be docked nine points by league bosses, making relegation almost certain and probably a welcome relief for the club’s supporters/ .

Portsmouth has already changed hands four times this season and has been at the bottom of the Premier League for most of it. .

On the foreign exchanges, the pound continued to fall . At close of trade Friday it was $1.5117, while standing at 1.1121 against the Euro.

As the markets closed for the weekend, the FTSE 100 was up 76.3 points, to 5,354.52. The rise erased most of the week’s trading losses, and made for a gain of 3.2 per cent for February.

According to revised figures, the US economy grew at an annual rate of 5.9% in the last quarter of 2009, higher than the first estimate of 5.7%.

According to economists, the rise was down to an increase in manufacturing output rather than stronger consumer spending; with the figures confirming that the world’s largest economy is moving rapidly away from recession.

On Friday, the Dow Jones Industrial Average continued to creep upwards, but at a much slower pace. It rose just 4.23 points to close on 10,325.26 while the NASDAQ Composite also rose by 4.04 points to close on 2,238.26

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Tags: AIG, Barclays, British Economy, British Pound, car insurance, Chesham, Dow Jones, Economics, Economy, Financial News, FTSE, HBos, Lloyds, Money, NASDAQ, Office for National Statistics, Property Prices, Recession, Royal Bank of Scotland, Skipton Building Society, Stocks and shares, T-Mobile, UK Banks, UK Economy, UK government, UK Recession

A recent report from the Chartered Institute of Personnel and Development (CIPD) has stated that the expected substantial cuts in the public sector, will mean that around one in three of the employers in the sector plan to shed jobs during the first quarter of 2010, which is now halfway through.

Despite the UK emerging from recession, CIPD’s latest quarterly survey found that the jobs outlook had worsened. UK unemployment currently stands at 2.46 million, with the number of people out of work steadily rising since the summer of 2008, despite a surprise fall in the three months to November.

British investors concerned about the outlook for UK inflation, consumer spending and the public finances following the recession, received some news that their fears would be confirmed. Inflation spiked up to a 14-month high of 3.5% in January, data released by the Office for National Statistics confirmed, as effects of the VAT hike and a number of other one-off factors such as the sharply falling oil and food prices of a year ago began to take their toll. The Bank of England’s forecasts suggest inflation should fall below the 2 per cent target in 2011 even though its latest analysis concedes that inflationary pressures are currently stronger than anticipated.

Taxpayers could be forced to wait five years before they start recouping the tens of billions of pounds spent propping up the banks.

UK Financial Investments, which oversees the Government’s stake in RBS, Lloyds and Northern Rock, fears it will be 2015 before it can sell off the shares.

It had hoped to start off-loading sooner after the bailout led by Chancellor Alistair Darling, but now believes that may not be possible without big losses. Officials, who have been careful not to give a timetable that could drive down share prices, are working on the basis of five years, while the Treasury fear that they may be forced to retain their minority stake for much longer.

According to a survey held by the Institute of Directors, sixty percent of UK companies who applied for a bank loan in 2009 ended up getting turned down. This sad and ridiculous situation has even led to company owners and directors being reduced to borrowing on their credit cards. Results of the Institute of Directors’ survey shows that the banks are simply not listening to Gordon Brown and Chancellor Alistair Darling orders to start lending again as payback for pumping £850 billion into the economy.

Even more of a cause for concern is that the report shows that 83% of businesses who were rejected for bank finance are also not receiving any information about alternative finance that may be available to them, including the Government’s Enterprise Finance Guarantee.

The report shows that increasingly more businesses, and especially the smaller ones, are turning to forms of expensive unsecured finance, such as credit cards, to get them through their short-term cash-flow problems. Particularly hard hit by the loan famine are small to medium sized UK companies whose desire to expand will be critical to creating jobs and dragging Britain out of recession.

On the same tack, credit card interest rates in the UK have climbed to their highest level since 1998. Millions now find themselves facing crippling repayments on their debts, despite the historically low Bank of England base rates. Average credit card interest has now soared to a staggering 18.8%, leaving consumers facing the prospect of paying more than 40% on the cash they have borrowed, an increase of 25% in the last four years.

Barclays Bank has announced an increase in their full-year profits of 92% in 2009. There full year profits were an outstanding £11.6 billion ($18.2 billion), with the figure being largely boosted by the sale of its BGI fund management arm to US firm BlackRock last year. Without the input from the sale of BGI, Barclays would have made just £5.3 billion, with £2.5 billion of that coming from their investment banking division…

Barclays, who did not take any direct state help during the financial crisis, also saw the level of its total bonus payouts rise to £2.7 billion, with £1.5 billion of that to be paid out for 2009 and a further £1.2 billion to be paid out over the coming three years.

Virgin Media are believed to be in the final stages of an agreement over the sale of its television channels to rival BSkyB. , the channels that are entirely owned and produced by Virgin Media, Virgin 1, Bravo, Challenge and Living, are due to be sold to BSkyB. Rupert Murdoch’s News Corp has a 39.1 percent share in BSkyB.

Meanwhile, Cheltenham based fashion retailer Supergroup, have announced that they ate to launch a flotation designed to rise up to £125 million pounds. If successful, the valuation of the company is expected to be around £400 million, roughly nine times Supergroup’s forecasted 2011 earnings

The pound fell back against the dollar, closing at 1.5633 while also slumping to 1.1453 against the Euro.

Overall, the FTSE 100 was stronger at 5,244.06, a rise of 58 points, and its sixth rise in seven trading days

Foreign demand for US Treasury bonds and notes in December fell by $53 billion as China was seen to be reducing its holdings. China cut its holdings by $34.2 billion, will still remaining the second-biggest US debt holder after Japan.

On Wall Street the Dow Jones Industrial Average continues to climb up 169.67 points at 10268.81. The NASDAQ gained a further 30.66 points to close on 2,214.19

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Tags: Alistair Darling, Bank, Bank of England, Banking, Barclays, BGI, Bravo, British Economy, BskyB, Challenge, Chartered Institute of Personnel and Development, CIPD, Dow Jones, Economy, Enterprise Finance Guarantee, Financial News, FTSE, Institute of Directors, Living, Lloyds, Money, Money Markets, NASDAQ, Northern Rock, Office for National Statistics, RBS, Recession, Stock Markets, Stocks and shares, Supergroup, UK Banks, UK Economy, UK Financial Investments, UK government, UK Recession, Virgin 1, Virgin Media, Wall Street

While the UK economy snapped back into growth in the fourth quarter of 2009, it did so at a rate considerably less than economists’ forecast. It was thanks to the service industries and manufacturing sector, which expanded just enough to pull Britain out of its longest recession on record. According to figures released by the Office for National Statistics, gross domestic product (GDP) rose by a mere 0.1% from the third quarter. The weakness of the recovery will pose a challenge to Bank of England officials who are due to sit next week to consider week whether the economy is strong enough to begin winding down the Government’s emergency stimulus measures. Prime Minister Gordon Brown’ is regarded as being especially anxious to see and end his government’s propping up of the economy, as delaying it may hamper his efforts to win an election due by June of this year. Much of Brown’s campaigns have been based on promises to curb the budget deficit.

Brown is putting up his case that he is better placed that Conservative leader David Cameron to cut the ballooning budget deficit without hurting the economic recovery. Splits in the Labour Party are beginning to show as election day draws closer with Chancellor of the Exchequer Alistair Darling announcing that it would be “absolutely mad” to withdraw stimulus measures now.

The Bank of England’s £200-billion pound asset-purchase facility, designed to keep borrowing costs low and help pull the economy out of the recession also expired this week.

Meanwhile it was announced that the UK economy shrank 4.8% in 2009, making for the biggest annual drop since records began in 1949. It was also reviled that the in the fourth quarter the economy contracted 3.2% compared to records from 2008.

The fourth quarter data, the first to be released by a Group of Seven nation, means Britain is the last member country to exit the recession that was sparked by the worst financial crisis since the Great Depression. The US Government was expected to release GDP data for the fourth quarter on late January 29.

The news that the Lloyds Banking Group has succeeded in placing of £2.5 billion pounds of mortgages with investors, has raised new hopes that securitisation markets are beginning to open for banks. A £4 billion issue last September by Lloyds recorded a first attempt by a bank to tap the securitisation markets since the onset of the credit crisis. However Friday’s issue was the first to cause any form of reaction interest among U.S. investors to purchase prime residential mortgage securities

There are strong signs of recovery popping up London’s financial services industry, which took a severe pounding during the credit crunch. Recruitment is already on the up, and a recent survey showed that more than 80 percent of hiring managers are expecting recruitment volumes to rise in 2010. Only five percent of those responding to the survey named handling redundancies as a key personnel challenge for the year ahead, will close to half of those interviewed pointed to the threat of competitors poaching staff as a problem. The main problem for 2010, according to close to two thirds taking part, would, be salaries and particularly of discretionary bonuses. Remuneration has become a major hot potato in the financial industry, as the sector has emerged from the crisis under increased public and regulatory scrutiny.

Irene Rosenfeld, chief executive of Kraft has predicted that Cadbury has a positive future under the ownership of the US conglomerate, whilst adding fears of job losses at the UK company are "greatly overstated" and.

In her first interview since the takeover was agreed by the Cadbury board earlier this month, Rosenfeld announced that Kraft would not be looking for any mergers and acquisitions activity in the "near term" following the purchase of the UK confectionary company. "We acquired Cadbury because we believe it is a fabulous business and it is our intention to protect those assets," Ms. Rosenfeld pointed out. "It is our intention to invest in the business; in fact, if anything, the opportunities for the business will be greater as a result of the combination than perhaps they might have been on a standalone basis, given some of the competitive pressures." She continued.

Speculation is growing that the planned sale of the discount fashion chain Matalan is unlikely to raise the sum in excess of £1.5 billion pounds targeted by the company’s owner John Hargreaves. American private equity firms TPG, Advent International among others are expected to make offers in time for next Friday’s deadline. Analysts fear that the parties involved are wary of paying too high a price for Matalan. A clause in the deal specifying a "break price" of between £1.2 to £1.25 billion pounds, has been inserted by Hargreaves, entitling him to refuse any bids below this figure

Expectations are that the release of British Airways’ results for the three months to the end of December 2009 will expose further heavy losses at the airline. BA is expected to reveal a loss of £151 million for the third quarter of the financial year, making for total losses up to the end of March to £602 million, up almost fifty percent from 2008, which was BA’s previous record loss. The threat of pre Christmas strikes and severe weather conditions are two factors among many that have contributed to the company’s already poor situation.

Carphone Warehouse subsidiary TalkTalk have announced the launch of a new television and mobile phone service. The launch is yet another sign of the telecoms group desire to step up its challenge to their sector rivals. Charles Dunstone, chief executive of Carphone Warehouse, outlined the plans for the new division on Friday as the company also released details of the demerger of its telecoms and retail interests. TalkTalk, due to gain a stock market listing in March, have identified TV and mobile services as potentially strong sources of growth. Carphone Warehouse’s broadband rivals already offer TV services, and the market is rapidly expanding.

UK Coal’s already stagnating share price was sent even lower as the mining and property group announced that were liable to increase by £100 million pounds in 2009. UK Coal has announced that they expect production in 2010 to be roughly seven million tonnes, compared with 7.9 million tonnes last year. The company faced severe technical and geological problems in its underground mines in the second half of 2008. The troubled company’s shares fell 4.5 pence to 61.5 pence.

The pound posted a weekly advance against the euro after the U.K. economy exited recession in the fourth quarter and Bank of England policymaker. Expectations are that the U.K. currency will continue to gain value as the government’s propping up of the economy may not be extended, with the decision to be announced when the Bank of England meets to decide on interest rates on Feb. 4. Sterling also posted a monthly gain against the Euro, when closing for the weekend at 1.532.

The pound strengthened 1.3 percent in the week, its strongest level in five months. It advanced 2.3 percent in the January. The U.K. currency dropped 0.7 percent to $1.5993 for a monthly decline of 0.8 percent.

The pound rose 8.5 percent against the euro in the first month of 2010, the biggest monthly gain since the single European currency was launched in 1999.

The US economy grew by an annual rate of 5.7% between October and December, official figures have shown.

The number, which is a first estimate, is a big rise from the previous quarter’s growth rate of 2.2%.

It suggests the country’s economy is growing at its fastest pace for six years and confirms the US economy has left its year-long recession behind.

But even with the rebound, gross domestic product (GDP) shrank by 2.4% across 2009 as a whole, making for the worst annual performance since 1946.

On the news, the Dow Jones fell again this time by 53.13 points, 135 points, to close on Friday at 10067.33, while the NASDAQ lost another 31 points, to finish for the weekend on 2147.35

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Tags: Advent International, Bank of England, Banking, British airways, British Economy, Cadbury, Carphone Warehouse, Charles Dunstone, David Cameron, Dow Jones, Economics, Economy, Financial News, GDP, Gordon Brown, Irene Rosenfeld, John Hargreaves, Labour party, Lloyds Banking Group, Matalan, Money, NASDAQ, Office for National Statistics, Recession, Retail, Stock Markets, Stocks and shares, TalkTalk, TPG, UK Banks, UK Coal, UK Economy, UK government, UK Recession

With an earlier than expected rise in inflation, which soared to 2.9% in December, interest rates could be rising sooner than expected in 2010.

The reading for the consumer prices index (CPI) came in well above the expected 2.4% figure making for the largest ever rise in inflation over a single month, according to figures issued by the Office for National Statistics (ONS) Reasons given were reduced s discounting from retailers in the run-up to Christmas and fuel prices remaining unchanged compared with sharp falls a year earlier.

The Bank of England had already expressed fears that inflation would rise this year, but this high figure will curtail the bank’s efforts to store up inflationary pressures while kick-starting the economy out of recession.

The Bank’s target for CPI inflation for 2010 is 2% and the jump to 2.9% puts its policymakers in a delicate position. While higher than expected inflation would force them to raise rates before the economy has properly recovered.

The head of the International Monetary Fund head has again warned that the global economy could yet experience another downturn, known in financial circles as a double dip recession.

Managing Director Dominique Strauss-Kahn said countries should rush to exit from stimulus packages that have bolstered growth through huge amounts of government spending and that it is too early for policy makers to withdraw stimulus that’s driving the global recovery.

“The global economy is recovering, even if its recovery is fragile,” Strauss-Kahn said in a recent speech. "While a plan to withdraw emergency measures “should be designed today” it should not yet be “implemented” because world economies are still dependent on government support and private demand remains weak" Strauss-Kahn has previously voiced his opinion that the world’s economic recovery is occurring “sooner and stronger” than anticipated. More than $2 trillion in government spending around the world has spurred growth, pulling economies out of a recession spurred by a meltdown in the U.S. housing market. Separately, Germany and France raised their growth forecasts for the year. Strauss-Kahn went on to add that China and Asian economies are leading the recovery.

British Airways cabin crew is to vote again on possible strike action, according to a recent announcement from the Unite union.

A spokesman for Unite predicted that a fresh ballot of its members would be held in the near future. The move came after recent talks with BA failed to find a resolution to a long-running dispute. BA announced in reply that they were "saddened but not surprised" by the decision, whilst promising to make every effort to allow talks to continue. If talks fail, a strike could begin as early as March if cabin crew vote in favour of industrial action.

BA had already planned a 12-day strike for Christmas last year which was blocked by a court injunction.

The long protracted takeover of Cadbury by US food company Kraft now appears to be going forward after the Cadbury board approved a new increased bid. Cadburys will now advise their shareholders to accept a new offer of 840 pence a share – valuing the company at £11.5 billion ($18.9 billion). Shareholders will also receive a dividend of 10 pence a share.

The additional cash represents a 90 per cent premium to the Cadbury share price before the deal was announced and a 50 per cent premium to Cadbury’s undisturbed share price of 568 pence before Kraft approached Cadbury in late August

Spokespersons from both Cadbury and Kraft jointly announced that details of the agreement were still being finalising and would make a statement later.

Many city pundits were surprised that the deal eventually went through so smoothly after months of animosity between the two companies.

It is expected that Kraft’s final offer consisting of 500 pence in cash, with the rest made of Kraft shares made the deal much sweeter for Cadbury shareholders. To finance the takeover Kraft will require borrowing around £7 billion ($11.5 billion)

Shares in Cadbury topped the FTSE 100 on Tuesday.

Sterling was among the few currencies to rise against the dollar and the Euro on Tuesday after UK inflation jumped in December, increasing the possibility of monetary tightening and increases in interest rates being brought forward. The pound closed at 1.636 against the dollar, with the Euro being traded at 1.1459

The FTSE 100 index rose 41.6 points to 5,496.9, while the FTSE 250 index added 33.4 points to 9,571.6.

In the US, Citigroup announced losses of $7.6 billion for the last quarter of 2009, large due to their efforts to repay US government bail-out funds, and coming after three consecutive profitable quarters. Citigroup’s ’s loss was in line with Wall Street analysts’ expectations and would amounted to a loss of $1.4 billion, had it not been for its repayment of the $20 billion in funds it received from the troubled asset relief programme. For the same period of a year ago, Citigroup reported a loss of $17.3 billion. In 2009 as a whole, Citigroup made a loss of $1.6 billion on $80.3 billion turnover.

The Dow Jones Industrial Average rose sharply on early trading after being closed on Monday for Martin Luther King Day. The index rose 115 points to close on 10,725.43. The NASDAQ Composite was also on the up, 32 points to 2320.4

Computer giant IBM has announced that after cost-cutting work helped to increase its earnings by 9% in the last three months of 2009.

They have raised their profit target for 2010. IBM made a net profit of $4.8 billion (£2.9 billion) for the fourth quarter, up from $4.4 billion from the same period in 2008, with turnover for the quarter increased by 1% to $27.2 billion

Crude prices fell to a three week low on Tuesday, with prices averaging around $77.00 a barrel. Traders pointed out the implications in the oil market of the bankruptcy of Japan Airlines, as the Tokyo-based carrier made extensive use of oil derivatives to hedge its cost and the bankruptcy is likely to force investment banks to unwind the hedges.

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Tags: Bank, Bank of England, Banking, British airways, British Economy, British Pound, Cadbury, Citigroup, consumer prices index, Crude oil, Currency, Dominique Strauss-Kahn, Dow Jones, Economics, Economy, Financial News, FTSE, IBM, Inflation, Interest Rates, International Monetary Fund, Japan Airlines, Kraft, Money, Money Management, Money Markets, NASDAQ, Office for National Statistics, Recession, Stock Markets, Stocks and shares, UK Banks, UK Economy, UK government, UK Recession, Unite, US Government

City Minister Lord Myners said he recognized the need for state-backed banks to compete in the global market, as he signaled the government would not block them from paying large bonuses to staff. Lord Myners told the Scottish affairs committee on Wednesday it was important the Royal Bank of Scotland was able to recruit and motivate employees. His comments came a day after the bank’s chief executive Stephen Hester revealed recruitment posted its biggest problem as RBS was being forced to compete on bonuses.

The number of businesses that went bust in 2009 increased by 18 per cent, but the economic outlook is slightly brighter for 2010. Recent information shows hat from the middle of 2009 onwards, the rate of business failures started to slow down compared to 2008 and early 2009, with a 7.7 per cent year-on-year decrease. This has to be good news for the economy as a whole. Business failures last year were not as extreme as 2008. The number of firms going bust in the fourth quarter of 2009 increased by almost a quarter compared to 2007, still an improvement on 2008, where the year-on-year increase was almost a third.

U.K. manufacturing unexpectedly stalled for a second month in November, a sign the economy is struggling to shake off the longest recession on record.

Factory output stayed unchanged from October, the Office for National Statistics said today in London. Economists predicted an increase of 0.2 percent, according to the median of 25 forecasts in a recent survey.

Bank of England policy makers last week pledged to spend the rest of their £200-billion bond-purchase program as they tried to cement an economic recovery.

Home Retail Group Plc sank 6.2 percent to 265.8 pence, the biggest decline since September, after a company spokesman announced that growth in the industry will be “hard to come by.”

Meanwhile HMV Group Plc slid 8 percent to 84.4 pence, the sharpest drop since December 2008, after saying holiday sales at stores open at least a year were hurt by the performance of its Waterstone’s bookstore chain.

The pound has been little changed against the dollar on recent days, and traded at 1.6245, up 0.5 percent on the day. The Euro was up to 1.262

The FTSE 100 Index added 24.72, or 0.5 percent, to 5,498.20. The FTSE 100 has extended its surge since March last year to 57 percent after central banks cut interest rates to record lows and governments worldwide committed about $12 trillion to revive the economy

Stateside President Barack Obama has ordered Wall Street banks to repay $117 billion (£72 billion) to taxpayers after criticizing banks for their "massive profits and obscene bonuses" culture. The tax is to recoup money US taxpayers are expected to lose from bailing out the banks during the financial crisis. The move follows populist anger at banks, seen as being responsible for causing the recent economic crisis. President Barack Obama will announce a sweeping new levy on about 50 financial institutions that will raise an estimated $90 billion to reduce the federal debt.

US stocks struggled to push higher on Thursday after an unexpected drop in retail sales gave investors reason for caution.

The Dow Jones Industrial Average had gained 0.1 per cent to 10,690.90 and the NASDAQ Composite was also 0.1 per cent higher at 2,310.58.

The market had opened lower after the latest commerce department figures showed retail sales, excluding cars, had fallen 0.2 per cent in December, with analysts forecasting a 0.3 percent increase

According to figures from the US Commerce Department, sales at US retailers saw an unexpected fall in December, casting uncertainty over the recovery of the US economy. Retail sales fell by 0.3% compared with November. Concerns over job security are expected to continue to restrict spending, with unemployment still at 10%. December’s figures end a tough year for US retailers, with total sales for 2009 down 6.2% on the previous year.

On the other hand, the tech industry’s earnings season got off to a flying start on Thursday with Intel reporting demand for its microprocessors boosted fourth-quarter revenues to $10.6 billion, well ahead of analysts’ forecasts of $10.2 billion. The world’s largest chip maker also reported earnings per share a third higher than Wall Street expected, at 40 cents rather than 30 cents.

Compared with a year ago, when orders collapsed in the teeth of the recession, Intel’s profits were 875 per cent higher at $2.3 billion.

Oil prices traded below $80 a barrel on Thursday, consolidating after recent losses triggered by a sharp increase in US crude and oil products inventories The recession has put a dent in future North Sea oil and gas production, with companies tapping fewer new oil reserves in 2009 than in previous years of operations there. Only eight oil and gas fields – expected to produce a combined total of 140 million barrels over their lifetime – began production in 2009, according to industry consultants.

That compares with an average of 600 million barrels of new reserves brought on stream each year between 2004 and 2008.

Production at the North Sea’s old fields has been declining since the start of the last decade increasing UK dependence on foreign oil.

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Tags: Bank of England, Banking, Barack Obama, British Economy, British Pound, Currency, Dow Jones, economic recovery, Economy, Financial News, FTSE, HMV Group Plc, Home Retail Group Plc, Intel, Lord Myners, Money, NASDAQ, North Sea oil, Office for National Statistics, Oil prices, RBS, Recession, Retail, Royal Bank of Scotland, Scottish affairs committee, Stephen Hester, Stock Markets, Stocks and shares, UK Banks, UK Economy, UK government, UK Recession, US Commerce Department, Wall Street, Waterstone's