Less to spend

9 January 2008 By Edward Hadas

From US phones to luxury Danish sound systems, customers seem to be feeling the pinch. Their reluctance to spend fits well with tighter lending standards, wobbly house prices and inflation in key goods. The financial problems of 2007 are turning into an economic drag in 2008.

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Context News

The Bank of England and the European Central Bank both held the overnight interest rate constant on Thursday, at 5.5% and 4% respectively.

AT&T's chief executive Randall Stephenson said he foresaw a slowdown, sending its shares down 9.5%.
Listen to the keynote speech webcast

Marks and Spencer's UK like forlikesales were down 2.2%, much worse than already low expectations. It led to the biggest fall in its shares for 18 years – down 18.8% on January 9.
M&S press release

Bang & Olufsen sacked its CEO a day after the company lost more than a quarter of its value. In the first half of 2007/08, B&O sales were flat in Germany, down 6% in Britain and rose only 3% in Denmark, the group's largest markets.
B&O H1 report

Easyjet's passenger numbers rose 9.9% in December but failed to match extra capacity added in the past year, sending its shares down as much as 14%.
Easyjet passenger statistics

Macy's December samestoresales fell 7.9%, a larger decline than expected. The company also cut its 2008 forecasts.
Macy's press release

Gap, Old Navy and Banana Republic posted 9%, 8% and 1% declines respectively. Shares sank as much as 7.8%.
Gap press release

DSG issued a profit warning after a poor Christmas. Its shares fell 22%
DSG trading statement

Lenovo's share fell more than 14% and wiped $1bn off its market capitalisation after a broker cut their recommendation to sell on fears of a US recession

Context News

The Bank of England and the European Central Bank both held the overnight interest rate constant on Thursday, at 5.5% and 4% respectively.

AT&T's chief executive Randall Stephenson said he foresaw a slowdown, sending its shares down 9.5%.
Listen to the keynote speech webcast

Gap, Old Navy and Banana Republic posted 9%, 8% and 1% declines respectively. Shares sank as much as 7.8%.
Gap press release

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