Rise in oil price lubricates equity markets 8 Oct 2004 Or so it seems. Oil and share prices have both been going up. That doesn t make economic sense. Expensive oil squeezes profits and slows down growth. But the hope of flattening rates is buoying investor confidence. That may not last.
VW appoints hard man to turn around cars 7 Oct 2004 Former Daimler executive Wolfgang Bernhard specialises in the sort of tough love Carlos Ghosn practiced at Nissan. If he s given a free rein, he could make an impact at the German carmaker. But the halfhearted nature of his appointment raises doubts.
High oil price has silver lining for European airlines 7 Oct 2004 A sustained $40plus oil price will squeeze the flag carriers hard. But it should make them think twice about expanding in a crowded market. For the likes of Easyjet and Ryanair, soaring oil prices reinforce barriers to entry and should weed out competitors.
Henkel moves to reduce conglomerate discount 7 Oct 2004 The German household products group is swapping its stake in US bleach giant Clorox for $2.8bn of cash and assets. While it has had to accept a 15% discount to Clorox s market value to pull off the deal, at least Henkel s getting a big tax break.
Bayer gets rid of a problem 7 Oct 2004 The German conglomerate s plan to spinoff most of its chemicals businesses will make life easier for the parent company. But why shareholders would want to own the spinoff is unclear.
Aircraft subsidy dispute could have happy ending 7 Oct 2004 That would be a stronger WTO and less government support for air travel. The industry is grown up enough to do without it. This needs the governments to play along. If they don t, trade confidence could be shaken, with fallout far beyond Boeing and Airbus.
Equities business crosses fingers for Q4 6 Oct 2004 Despite a burst of activity earlier in the year, 2004 is shaping up to be a dissapointment for the equities business. Things may pick up after the US election. But this is only one among several factors that could keep activity muted for some time. Despite a burst of activity earlier in the year, 2004 is shaping up to be a disappointment for the equities business.
Bollore plays a risky game with Havas 6 Oct 2004 By shopping it around, the corporate raider risks destabilising the French ad firm. Key clients and employees could defect. He is probably banking on a takeover from Publicis or WPP. Neither is straightforward.
ThyssenKrupp doesn’t need a steel deal 6 Oct 2004 The German engineering group says it plans to acquire a European steelmaker and has even floated the name of Corus. But this would be a risky and retrograde step. Thankfully, no deal looks imminent.
Steel heading for different type of bust 6 Oct 2004 Soaring prices seen in recent months won't last as new supply comes on stream. But the bad old days of permanent malaise are finished. Demand growth in Asia means steel is better thought of as a growth cyclical, a bit like semiconductors.
Karstadt sends mixed signals on insolvency risk 6 Oct 2004 It isn t clear which story is true. But sending mixed signals certainly won t foster confidence in Karstadt s restructuring. One day the German retailer says it will go bust if unions don t back a restructuring plan. The next day it says insolvency isn't imminent.
Man Utd fans vow to fight Glazer bid 5 Oct 2004 The UK football club s supporters seem to be dead set against a takeover by American football tycoon Malcolm Glazer. Glazer can t afford to totally ignore them. But he doesn t need them to take over the Red Devils.
UK industry enjoys modest profit boom 5 Oct 2004 Returns on capital are probably peaking, at a lower level than in 1998. The manufacturing sector has weakened. It may be time to call the end of the great Thatcher improvements. As domestic oil profits fade, corporate prospects look less impressive.
Is it time for Italian bank M&A? 5 Oct 2004 The sector has to consolidate before crossborder M&A kicks off. Moreover, Italian banks are done restructuring and shares have recovered. But as ever in Italy the evidence points two ways. Sorting out the bank puzzle remains a pretty hard task.
Diageo raises £1.3bn from General Mills stake 5 Oct 2004 The UK drinks group is piling up cash even as its liabilities are set to fall. All this paves the way for increased share buybacks.
Saga sale underscores fragility of IPO markets 5 Oct 2004 The UK insurer s choice of a sale to private equity instead of a float had a lot to do with its quirky business model. But it is also evidence that bankers face a huge challenge in overcoming the scepticism of institutions towards the primary market.
EU is too divided for strong foreign policies 5 Oct 2004 It can act by itself on trade. But when politics come in, the big nations still have to agree. The result is a meek silence on Russia. And a confused delay for Turkey.
Man Utd receives bid approach 4 Oct 2004 It s not clear who is after the Red Devils, but all bets are on American football tycoon Malcolm Glazer. Longstanding bid speculation has already made the UK soccer club a mouthful. Glazer will have to get creative to finance an offer.
Why are retail turnarounds so hard? 4 Oct 2004 A number of the sector s grand old names Sainsbury, Safeway, Boots and M&S have been trying without success to arrest decline. One problem is that the environment is inclement, and getting more so. Another is that turnarounds take a long time.
Boeing, Airbus fight risks embarrassing both 4 Oct 2004 Boeing as much as Airbus would face WTO sanction were the US to press ahead with a complaint against the latter's subsidies, an EU memo says Both aircraft makers receive subsidies of some kind. And Boeing is in little position to take the moral high ground.
BASF doubles E500m share buyback 4 Oct 2004 The German chemical group is doing the right thing by returning capital. But the group is merely making the best of a bad lot. BASF cannot singlehandedly revive its sluggish markets.
Share price volatility hits eight-year low 4 Oct 2004 This is not quite as unusual as it may first seem. Taking a long view, recent high levels of volatility have been the aberration. Nevertheless, volatility is now low enough to be sounding alarm bells. It may signal that investors are being complacent about risks.
Dollar could break range-bound markets 4 Oct 2004 The dollar may be slipping into a new range against the euro. This might be the first move in a big adjustment. Financial markets remain deceptively calm, but under the surface, economic tension is growing.
Merck’s rivals will share Vioxx pain 1 Oct 2004 The withdrawal of the US group s arthritis drug will cause knockon effects throughout the drug sector. Merck will promote its remaining drugs heavily. Novartis and Glaxo will find life tougher. But ScheringPlough could be a beneficiary.
Markets must cope without Fannie Mae’s help 1 Oct 2004 New capital constraints agreed by the giant US mortgage intermediary are but a sign of things to come. Fannie Mae is far too big. But if it can t grow, house prices are vulnerable and bond markets will miss liquidity during times of stress.
Schroeder hits out at Karstadt rescue 1 Oct 2004 The German chancellor says the workers are taking too much pain. He's not necessarily right, but he makes a valid point. Karstadt will still be undercapitalised after the restructuring. And that's a product of its shareholding structure.
First year proves tough for Citigroup boss 1 Oct 2004 Charles Prince was slightly dropped in it by Sandy Weill, who left a legacy of regulatory problems. These are hurting the stock and complicating Prince s next obvious move buying a big deposit gatherer in the US.