Posts tagged "FTSE"

FTSE 100 within sight of all-time high

Index closes at 6803.87 – just 130 points below peak reached on 30 December 1999 at height of the dotcom boom

The London stock market is within sight of its all-time closing high after another surge in share prices on Tuesday.

After drifting for much of the day, the FTSE 100 index of Britain’s top companies made a late rally to close 48.24 points higher at 6803.87. This marked its best level for more than 13 years and left the index just 130 points below the peak reached on 30 December 1999 at the height of the dotcom boom. Since the beginning of the year the index has risen 906 points or more than 15%.

A revival in mining shares and positive reaction to updates from the likes of Marks & Spencer and Vodafone helped push the market higher on Tuesday.

But, as has been the case since the rally began last summer, the driving force was the expectation that central banks would continue to take action to boost the global economy through low interest rates, bond buying programmes and quantitative easing. Recent data has shown a pick-up in the economy, suggesting the measures are having the desired effect.

In the UK, better-than-expected inflation figures, which showed the consumer price index falling from 2.8% in March to 2.4% last month, left the way open for further easing from the Bank of England, particularly when new governor Mark Carney takes over in July.

Concerns that the US central bank might begin to ease off its bond buying programme had been growing ahead of testimony by US Federal Reserve chairman Ben Bernanke on Wednesday. The Fed has been helping to support global markets by buying $85bn of bonds every month, and meets next month to decide its next move.

But just before the UK market closed, Federal Reserve member James Bullard seemed to allay fears of an imminent end to quantitative easing in a speech delivered at Goethe University in Frankfurt. He said the Fed should keep buying bonds while adjusting the pace of purchases depending on economic conditions. He said: “Quantitative easing… involves clear action and has been effective.”

Despite the recent rally, the FTSE 100 is still lagging other global markets such as the US S&P 500 and Germany’s Dax which have already reached record levels.

But the FTSE All-Share index, a broader measure, is at an all-time high having closed 24.80 points higher at 3587.85, its 14th daily rise in a row. Economist Ian Williams of City broker Peel Hunt pointed out that this run had only been beaten once – over the 1986 and 1987 new year period – since the index began to be calculated in the late 1960s.

The buoyant market is good news for the chancellor, George Osborne, as he tries to persuade voters his emphasis on public spending cuts is working. On Wednesday he will face a new test when the International Monetary Fund delivers its verdict on his austerity programme after two weeks of examining the UK economy. Last month the IMF called on Osborne to moderate the pace of deficit reduction.

Many analysts believe the FTSE 100 could soon break through its previous high and breach the 7000 level shortly after. But others sounded a note of caution. Alex Young, senior sales trader at CMC Markets UK, said: “In a technical sense markets are beginning to look a little over extended, and the potential for profit taking to trigger a market correction has to be a consideration for even the most fervent bulls. That said, as the cliché goes, markets can remain over extended for a lot longer than retail traders can remain solvent. As ever, caution is advised when fighting the trend.”

FTSE 100′s use of tax havens – get the full list

Research has found that the UK’s biggest public companies have more than 8,000 subsidiaries or joint ventures in tax havens – but which businesses have the most?

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Which major UK corporations keep subsidiaries in tax havens? The short answer, according to updated research by development charity ActionAid, appears to be almost all of them.

The research found 98 of the 100 companies in the FTSE 100 – the hundred biggest publicly listed UK corporations – had subsidiaries, associates, or joint ventures in countries defined by the charity as tax havens.

These included well-known offshore tax havens, such as the British Virgin Islands and Cayman Islands, as well as larger “onshore” countries which have been criticised for low taxes, lax regulatory regimes, or stringent corporate secrecy rules. The charity has provided a full rationale for its list of havens here.

The figures were collated through a months-long process began in September 2012 (and using the FTSE 100′s composition at that date), using official corporate documentation.

In their extensive annual reports, many companies list a small number of “principal” subsidiaries – but buried in further filings, or in documents submitted to US authorities, lie dozens or hundreds more, scattered across the world. However, even once the existence of the offshore subsidiaries is known, no further information can be obtained, due to strict secrecy rules in most offshore jurisdictions.

Of course, a company’s presence in a given jurisdiction doesn’t itself demonstrate tax avoidance in any country, and there is no suggestion any of the listed companies have any offshore structures not permitted under UK law – and many of the FTSE 100 companies are keen to note they are major UK taxpayers.

However, given the renewed focus on offshore secrecy, and pressure on tax havens for greater transparency and accountability, an insight into the extent of the jurisdictions’ usage is telling.

The top ten companies by offshore usage are listed below (note WPP’s list is based on a 2011 SEC filing, and as in more recent submissions the company has taken advantage of an exemption allowing it to list only a small number of “principal” subsidiaries)

The research also shows which sectors make the most use of tax havens. Four out of five overseas companies operated by real estate companies are located in tax havens, compared with about one in three travel and leisure businesses.

We’ve included a summary table showing the total number of subsidiaries each FTSE 100 company has in tax havens, and how many of those are in countries with ties to the UK (Crown dependencies like Jersey and Guernsey, or British overseas territories like the BVI) – and the full country-by-country data is in the linked spreadsheet at the foot of this post.

Do you spot anything of interest in this data – or have you got thoughts on visualising it? Let us know what you make in the comments, or via Twitter @GuardianData

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UK’s top companies condemned for prolific use of tax havens

• Only two of FTSE 100 have no subsidiaries in havens
• Big four banks and Tesco among biggest users
• ActionAid findings described as shaming by Lib Dem peer

The UK’s 100 biggest public companies are running more than 8,000 subsidiaries or joint ventures in onshore and offshore tax havens, according to research published on Monday, raising fresh concerns about the full extent of corporate tax avoidance.

The figures, published by the charity ActionAid, show that only two of the companies listed on the UK’s FTSE 100 have no subsidiaries in tax havens – while companies such as Barclays and Tesco own hundreds.

Corporate use of offshore subsidiaries has been roundly criticised by tax campaigners as a tactic to legally reduce corporate tax bills, with Vodafone, Starbucks and Amazon attracting widespread protests and criticism from MPs.

David Cameron has pledged to put tackling the issue of tax avoidance and offshore secrecy at the heart of next month’s G8 summit, which Britain chairs this year.

Speaking after Saturday’s meeting of F7 finance ministers, the chancellor, George Osborne, said international action was needed, adding it was “incredibly important that companies and individuals pay the tax that is due”.

However, many of the offshore jurisdictions used by the FTSE 100 have close ties to the UK, illustrating the challenge facing Cameron and Osborne ahead of negotiations with other G8 leaders.

In total, FTSE 100 companies have 1,685 subsidiaries in UK Crown dependencies such as Jersey, or overseas territories such as the British Virgin Islands (BVI), Bermuda and Gibraltar.

The Treasury recently secured a deal to share more information on potential income-tax evaders operating out of British overseas territories. But campaigners warn that agreements so far do little to tackle offshore corporate secrecy and structures.

The research also compiled data covered by a wider definition of tax haven, including onshore jurisdictions such as the US state of Delaware – accused by the Cayman islands of playing “faster and looser” even than offshore jurisdictions – and the Republic of Ireland, which has come under sustained pressure from other EU states to reform its own low-tax, light-tough, regulatory environment.

By this measure, the UK’s biggest public companies keep a total of 8,311 subsidiaries in tax havens – more than one in three of all the FTSE100′s 22,042 foreign subsidiaries, associates and joint ventures.

The figures show that banks are the most prolific user of havens with the big four – Barclays, HSBC, the Royal Bank of Scotland, and Lloyds – among the top 10.

Barclays said in 2011 it was working to cut the number of its offshore subsidiaries in the Caymans, but the research shows it still had more than 120 subsidiaries in the Caribbean territory, along with dozens of others in other overseas jurisdictions with low tax rates or limited disclosure rules to other tax authorities.

Lord Oakeshott, the Liberal Democrat peer, who resigned as the party’s Treasury spokesman after criticising the government’s deal on banking regulation as “pitiful”, said the research showed new measures on tax havens were needed.

He said: “Tax transparency must start at home. ActionAid’s devastating research makes us ashamed to be British. Far too many of Britain’s top companies wash billions of profits through pipelines of British tax havens to vanish behind shiny brass plates in shady places.

“Cameron and Osborne can’t strut the world stage as fair tax crusaders until they end this tax abuse, starting with the banks we own, RBS and Lloyds.”

But use of offshore jurisdictions extends far beyond the banking world. Food manufacturers, retailers, and drinks firms were among the FTSE 100 companies using offshore jurisdictions.

The retailer with the most subsidiaries in countries dubbed tax havens was Tesco, which had 107, often tied to its financial services provisions. These included eight firms based in Jersey, nine in the BVI, and 14 in the Cayman Islands.

Particular concern is expressed by campaigners about the cost of offshore tax deals to the populations of developing countries.

For instance, Tullow Oil, which describes itself as “Africa’s leading independent oil company” draws 84% of its revenues from the continent, but only four of the 81 companies it lists as subsidiaries are registered in African countries. By contrast, more than half (47) are registered in tax havens including the BVI, St Lucia, the Channel Islands and Netherlands.

Three-quarters of these tax haven companies refer to developing countries, such as Liberia, Kenya, Malawi and Sierra Leone, in their names.

While the countries highlighted by the ActionAid study have been targeted because of their rules on secrecy or tax management, a company’s presence in such countries does not mean they are necessarily engaging in such practices.

There is no suggestion that any of the FTSE 100 firms have engaged in practices in contravention of tax laws.

Mike Lewis, ActionAid’s tax justice policy adviser, who did the research, called tax havens “one of the biggest hidden obstacles” in the fight against global poverty.

He added: “Poor countries lose three times more money to tax havens than they receive in aid each year. .

“Tax haven structures are almost universal amongst the UK’s biggest multinationals and becoming ever more common for investments in developing countries.

“When David Cameron chairs the G8 summit in Northern Ireland next month he must deliver on his promise to call time on tax havens for the benefit of all countries, rich and poor.”

The two FTSE 100 companies found to have no subsidiaries in tax havens were the mining group Fresnillo and the financial advice business Hargreaves Lansdown.

A spokesperson for Tullow Oil said the company did not avoid tax and did not use companies in tax havens to avoid tax, adding: “Our clear aim in tax planning is to ensure that the appropriate amount of tax is paid in the jurisdiction in which the activities are undertaken.

“As such, no country in which we operate is losing out because some of the companies that we own are located in tax havens.”

Seven of its subsidiaries were dormant with no profits and were scheduled for elimination while five were holding companies with minimal activity, he added.

A Barclays spokesperson said the company was among the UK’s top taxpayers and acted ethically.

She said: “This story is based on misconception and is misleading. Delaware is not a low-tax jurisdiction. Profits in the state are subject to US corporate tax at 35%, as well as Delaware state tax.

“Barclays has substantial businesses in many of the jurisdictions mentioned.

“In the Caymans virtually all of the profits generated in these companies are subject to corporate tax at the UK corporate tax rate. “The number of Barclays’ entities in low-tax jurisdictions reduced from 339 in 2009 to 252 by February 2013 – a 26% reduction. We plan to make further reductions in 2013.”

A Tesco spokesperson said: “We are one of the largest payers of tax in the UK. In the year ended February 2012 we contributed £1.5bn directly, including £519m in corporation tax. We do have a number of companies within low-tax jurisdictions, but these are all either holding companies, dormant, registered for UK tax, or subject to controlled foreign company regulations and agreed with HMRC.”

While measures have been taken already to crack down on the separate issue of tax avoidance by individuals, campaigners have repeatedly said that without steps to tackle corporate activities in havens action will be futile.

UK’s top companies condemned for prolific use of tax havens

• Only two of FTSE 100 have no subsidiaries in havens
• Big four banks and Tesco among biggest users
• ActionAid findings described as shaming by Lib Dem peer

The UK’s 100 biggest public companies are running more than 8,000 subsidiaries or joint ventures in onshore and offshore tax havens, according to research published on Monday, raising fresh concerns about the full extent of corporate tax avoidance.

The figures, published by the charity ActionAid, show that only two of the companies listed on the UK’s FTSE 100 have no subsidiaries in tax havens – while companies such as Barclays and Tesco own hundreds.

Corporate use of offshore subsidiaries has been roundly criticised by tax campaigners as a tactic to legally reduce corporate tax bills, with Vodafone, Starbucks and Amazon attracting widespread protests and criticism from MPs.

David Cameron has pledged to put tackling the issue of tax avoidance and offshore secrecy at the heart of next month’s G8 summit, which Britain chairs this year.

Speaking after Saturday’s meeting of F7 finance ministers, the chancellor, George Osborne, said international action was needed, adding it was “incredibly important that companies and individuals pay the tax that is due”.

However, many of the offshore jurisdictions used by the FTSE 100 have close ties to the UK, illustrating the challenge facing Cameron and Osborne ahead of negotiations with other G8 leaders.

In total, FTSE 100 companies have 1,685 subsidiaries in UK Crown dependencies such as Jersey, or overseas territories such as the British Virgin Islands (BVI), Bermuda and Gibraltar.

The Treasury recently secured a deal to share more information on potential income-tax evaders operating out of British overseas territories. But campaigners warn that agreements so far do little to tackle offshore corporate secrecy and structures.

The research also compiled data covered by a wider definition of tax haven, including onshore jurisdictions such as the US state of Delaware – accused by the Cayman islands of playing “faster and looser” even than offshore jurisdictions – and the Republic of Ireland, which has come under sustained pressure from other EU states to reform its own low-tax, light-tough, regulatory environment.

By this measure, the UK’s biggest public companies keep a total of 8,311 subsidiaries in tax havens – more than one in three of all the FTSE100′s 22,042 foreign subsidiaries, associates and joint ventures.

The figures show that banks are the most prolific user of havens with the big four – Barclays, HSBC, the Royal Bank of Scotland, and Lloyds – among the top 10.

Barclays said in 2011 it was working to cut the number of its offshore subsidiaries in the Caymans, but the research shows it still had more than 120 subsidiaries in the Caribbean territory, along with dozens of others in other overseas jurisdictions with low tax rates or limited disclosure rules to other tax authorities.

Lord Oakeshott, the Liberal Democrat peer, who resigned as the party’s Treasury spokesman after criticising the government’s deal on banking regulation as “pitiful”, said the research showed new measures on tax havens were needed.

He said: “Tax transparency must start at home. ActionAid’s devastating research makes us ashamed to be British. Far too many of Britain’s top companies wash billions of profits through pipelines of British tax havens to vanish behind shiny brass plates in shady places.

“Cameron and Osborne can’t strut the world stage as fair tax crusaders until they end this tax abuse, starting with the banks we own, RBS and Lloyds.”

But use of offshore jurisdictions extends far beyond the banking world. Food manufacturers, retailers, and drinks firms were among the FTSE 100 companies using offshore jurisdictions.

The retailer with the most subsidiaries in countries dubbed tax havens was Tesco, which had 107, often tied to its financial services provisions. These included eight firms based in Jersey, nine in the BVI, and 14 in the Cayman Islands.

Particular concern is expressed by campaigners about the cost of offshore tax deals to the populations of developing countries.

For instance, Tullow Oil, which describes itself as “Africa’s leading independent oil company” draws 84% of its revenues from the continent, but only four of the 81 companies it lists as subsidiaries are registered in African countries. By contrast, more than half (47) are registered in tax havens including the BVI, St Lucia, the Channel Islands and Netherlands.

Three-quarters of these tax haven companies refer to developing countries, such as Liberia, Kenya, Malawi and Sierra Leone, in their names.

While the countries highlighted by the ActionAid study have been targeted because of their rules on secrecy or tax management, a company’s presence in such countries does not mean they are necessarily engaging in such practices.

There is no suggestion that any of the FTSE 100 firms have engaged in practices in contravention of tax laws.

Mike Lewis, ActionAid’s tax justice policy adviser, who did the research, called tax havens “one of the biggest hidden obstacles” in the fight against global poverty.

He added: “Poor countries lose three times more money to tax havens than they receive in aid each year. .

“Tax haven structures are almost universal amongst the UK’s biggest multinationals and becoming ever more common for investments in developing countries.

“When David Cameron chairs the G8 summit in Northern Ireland next month he must deliver on his promise to call time on tax havens for the benefit of all countries, rich and poor.”

The two FTSE 100 companies found to have no subsidiaries in tax havens were the mining group Fresnillo and the financial advice business Hargreaves Lansdown.

A spokesperson for Tullow Oil said the company did not avoid tax and did not use companies in tax havens to avoid tax, adding: “Our clear aim in tax planning is to ensure that the appropriate amount of tax is paid in the jurisdiction in which the activities are undertaken.

“As such, no country in which we operate is losing out because some of the companies that we own are located in tax havens.”

Seven of its subsidiaries were dormant with no profits and were scheduled for elimination while five were holding companies with minimal activity, he added.

A Barclays spokesperson said the company was among the UK’s top taxpayers and acted ethically.

She said: “This story is based on misconception and is misleading. Delaware is not a low-tax jurisdiction. Profits in the state are subject to US corporate tax at 35%, as well as Delaware state tax.

“Barclays has substantial businesses in many of the jurisdictions mentioned.

“In the Caymans virtually all of the profits generated in these companies are subject to corporate tax at the UK corporate tax rate. “The number of Barclays’ entities in low-tax jurisdictions reduced from 339 in 2009 to 252 by February 2013 – a 26% reduction. We plan to make further reductions in 2013.”

A Tesco spokesperson said: “We are one of the largest payers of tax in the UK. In the year ended February 2012 we contributed £1.5bn directly, including £519m in corporation tax. We do have a number of companies within low-tax jurisdictions, but these are all either holding companies, dormant, registered for UK tax, or subject to controlled foreign company regulations and agreed with HMRC.”

While measures have been taken already to crack down on the separate issue of tax avoidance by individuals, campaigners have repeatedly said that without steps to tackle corporate activities in havens action will be futile.

FTSE 100 hits highest since October 2007

Central bank action, reasonable economic data and upbeat company results continued to support the market

Leading shares rose for the seventh day in a row on Friday, with the FTSE 100 index closing above 6600 for the first time since October 2007.

A combination of central bank action, reasonable economic data and upbeat company results continued to support the market as investors sought returns amid low interest rates.

In the wake of the rate cut by the European Central Bank earlier this month, a number of other countries followed suit last week in continuing efforts to boost the global economy, including Australia, Poland, Korea and Vietnam. The Bank of England however, as expected, refrained from further action after Thursday’s meeting.

Meanwhile signs of life in the eurozone, including positive German manufacturing figures, also helped sentiment.

So the FTSE 100 finished at 6624.98, up 0.5% on the day but off its best levels following a weak start on Wall Street. At the beginning of the shortened bank holiday week, the index stood at 6521. Since the turn of the year, it has climbed around 12% to its current five-and-a-half year high.

During the week both the Dow Jones Industrial Average and Germany’s Dax reached new peaks, while the Nikkei also hit its highest level since 2007.

Back in the UK, BT soared 12.3%, or 33.8p, to 309.5p on Friday after better than expected full year profits of £6.2bn, up 2%. TUI Travel also pleased investors, adding 6.3p to 346.9p as it forecast a profit rise of 10% for the year driven by strong trading in the UK and the Nordic region. It said 58% of its mainstream summer holiday programme was sold. The news came as it reported a first half operating loss of £289m, down from £317m as the winter season closed ahead of expectations.

Shire rose 85p, or 4.4%, to £20.19 following news late on Thursday that the drugmaker had won a patent trial against US group Actavis related to a generic version of its ulcerative colitis treatment.

Analyst Peter Verdult at Morgan Stanley said:”This news provides a much needed tonic, given the weak first quarter performance, and lack of significant pipeline data until 2014.Shire is committed to delivering revenue growth of more than 5% per annum, whilst moving to a flatter/more scalable operating structure involving five units (Rare Diseases, CNS, GI, Regenerative & Internal Medicine – ophthalmology) and a single R&D organisation. Efforts to bolster the mid/late stage pipeline are set to intensify.

“We see scope for Shire’s 15% discount [to the sector] to narrow sharply, given market confidence is likely to quickly rebound on the back of the near-term growth outlook improving.”

Brian White at Shore Capital said: “With sales of $400m, Lialda represented 8.5% of sales, and along with Pentasa, represents the cornerstone of the gastro-intestinal franchise. We had previously taken the view that, while there was a potential headline risk from a negative outcome, that the new FDA guidance requirements for generic mesalamine based products were so onerous that they would be difficult for the generic industry to overcome.

“Following the settlement with Actavis regarding Intuniv, success in this dispute with Actavis over Lialda does remove another drag on sentiment for Shire. Hopefully, we can now focus on the growth strategy that new chief executive Flemming Ornskov has recently articulated.”

Earlier in the week Shire was the subject of renewed bid talk. It has previously been linked with Bristol-Myers Squibb, Pfizer and AstraZeneca.

News that ArcelorMittal, the world’s largest steelmaker, had defied fears of a profit warning and kept its earnings forecast for this year helped lift Russian rival Evraz, controlled by Chelsea owner Roman Abramovich, 0.5p to 171.4p.

Controversial Kazakh miner Eurasian Natural Resources Corporation recovered a little ground after recent falls, and closed up 2.4p at 293.9p. Earlier in the week its two brokers resigned, while it also reported a disappointing production update, with iron ore extraction hit by a severe winter in Kazakhstan.

Among the mid-caps, Centamin slumped 7.7p, or 17%, to 37.9p, after the gold miner said a report on its Sukari mine in Egypt was not positive. A court questioned the miner’s right to operate Sukari in October, and now a report from the Egyptian State Commissioner’s office with non-binding recommendations has not helped its case. But Centamin said the recommendations do not address the merits of its appeal, which will be heard on 19 June, and it would continue to defend its rights.

Aim-listed Monitise added 4p, or 11.8%, to 38p after US hedge fund manager Leon Cooperman named the mobile payment group as one of his favourite stocks at SkyBridge Alternatives Conference in Las Vegas on Thursday.

Finally Quindell Portfolio, an acquisitive outsourcing and claims management business whose customers include the RAC, fell another 1.3p, or 18.3%, to 6p. After investors learned of a £13m derivatives contract revealed in its results this week, related to its purchase of Accident Advice Helpline, the shares slumped from 12p. The deal was financed by placing £17m worth of shares, with the derivatives contract designed to offer protection against a fall in the share price. As the market closed on Thursday, Quindell tried to stem the tide of selling by issuing a statement saying it knew of no valid reason for the share price drop. It said it had a strong balance sheet, the equity swap was not material in relation to the size of the company and was not likely to be exercised until the share price was substantially higher. So far these comments seem to have had little effect.

Three new female non-executive directors appointed to FTSE 100 boards

Campaigners hope appointments signal reversal in slowing rate of women hired to Britain’s top corporate roles

Three new female non-executive directors were appointed to FTSE 100 boards on Wednesday, in moves campaigners hope signal a reversal in the slowing rate of women hired to Britain’s top corporate roles.

A trio of announcements unveiled Susan Rice, managing director of Lloyds Banking Group in Scotland, as a new director of the grocer J Sainsbury; Jo Harlow, vice president of mobile group Nokia, as a non-executive of software firm Sage; and Jill McDonald, who runs the northern Europe division of burger chain McDonald’s, as the latest director of InterContinental Hotels Group.

Last month the business secretary, Vince Cable, conceded that the momentum of women winning top posts “appears to be slowing”, despite a surge in the wake of the 2011 report by former banker Lord Davies that recommended women should fill 25% of FTSE 100 board roles by 2015.

While the figure has since increased from 12.5% to 17.4%, in the past two months just 12% of FTSE boardroom vacancies have gone to women, compared with about 50% at the same time last year.

Jane Scott, a director of the Professional Boards Forum which compiles the statistics, said: “[The appointments are] really good news. It has been a terribly slow year.”

FTSE 100 edges higher after five days of decline, with ENRC leading the way after bid approach

Volatile week sees leading index lose 1.5% on worries about global growth and pressure on commodity prices

A possible bid for controversial Kazakh miner Eurasian Natural Resources Corporation ended a downbeat week for commodity companies on a more positive note.

ENRC jumped nearly 27% after news that its three major oligarch shareholders, Alexander Machkevitch, Alijan Ibragimov and Patokh Chodlev, were considering forming a consortium with the Kazakh government to take the miner private.

News of the bid approach lifted ENRC by 61.2p to 291p, but this is still well short of the miner’s flotation price of 540p in 2007, let alone the peak of more than £15 it reached in May 2008. Kazakhmys, which owns 26% of ENRC, losed 75.6p better at 385.7p.

Earlier in the week the mining sector was hit by a plunging gold price, partly on fears cash-strapped Cyprus could begin a trend by selling off its reserves of the precious metal. At the same time signs of an economic slowdown in China and the US, not helped by the International Monetary Fund cutting its growth forecasts, sent base metals lower. But there was a slight recovery in metal prices by end of the week as analysts said the sell-off had been overdone and hopes were raised that the eurozone could embark on its own programme of quantitative easing. At the very least Bundesbank chief Jens Weidman hinted the European Central Bank might be prepared to reduce interest rates.

So on Friday Vedanta Resources rose 66p to £11.51, Fresnillo climbed 31p to £11.17 and Randgold Resources ended 51p higher at £46.654. Anglo American added 34.5p to 1596.5p after it reported iron ore, copper and coal production increases in the first three months of the year.

Overall, after five days of falls, the FTSE 100 finished 42.92 points better at 6286.59, although traders were admittedly distracted by the manhunt in Boston and the market closed before Fitch downgraded the UK’s credit rating. Over the course of the week the index lost 97 points or 1.5%. William Nicholls, dealer at Capital Spreads, said:

So at the end of an eventful week we should look back and decide whether markets have reacted fairly to economic events – probably not. So far, US earnings have by no means been a disaster, growth figures and indicators have been a little disappointing, but for these things to warrant a whole week of moves to the downside seems unfair. The spark for all this would have been the extraordinary move in gold that book-ended last weekend, but I think the long and short of it is that people realised we had got a little ahead of ourselves this year- maybe investment managers around the world are satisfied with returns this year already and are already shutting up shop?

Banks were better as investors dipped their toes into riskier waters. HSBC was 15.9p higher at 679.2p and Barclays, which cut the last ties with the Bob Diamond era on Thursday by announcing the departure of investment banking boss Rich Ricci, was 2.6p better at 286.35p. In a buy note with a 345p price target analyst Ian Gordon at Investec said:

Investors should welcome the news – ongoing revenue delivery, but with lower costs!

Lloyds Banking Group added 0.405p to 47.49p amid talk it was looking for a buyer for its asset management business Scottish Widows Investment Partnership. Gary Greenwood at Shore Capital said the division could be worth around £1.2bn:

In our opinion, a decision to sell SWIP is likely to have been taken in response to the outcome recent FSA (now FCA) review into bank capital, which identified a capital shortfall for the UK banking industry of £25bn, of which around half would be closed during 2013 as a result of plans already put in place by the banks. Although the FSA did not identify the capital deficit by bank, we understand from media reports that the anticipated shortfall at Lloyds will be somewhere in the region of £3bn as at the end of December 2013. With an asset management business likely to have little in the way of net asset backing, in our view, our initial thought is that the majority of the disposal proceeds could accrue to capital. Finally, we believe the extent of any earnings dilution from a disposal of SWIP is likely to be fairly immaterial. As such, we would welcome such a disposal on the basis that it would help bolster the group capital position while having a limited impact on profitability.

Vodafone edged up 0.75p to 193.25p on growing hopes of a sale of its 45% stake in US joint venture Verizon Wireless. There has been much talk of the tax liability Vodafone would face if it disposed of the shareholding, but on Thursday its US partner Verizon said it believed a deal could be done in a tax efficient manner. Analysts at Liberum Capital said:

We have consistently argued that concerns on the tax liability on any Vodafone disposal are overplayed and cannot believe that [the] comments from Verizon’s chief financial officer Fran Shammo will be ignored by investors. The statement is pretty clear and there is no doubt that he would have given a lot of thought to this answer. Verizon is clearly increasing pressure on Vodafone to act.

Vodafone for its part, in conversation with us, played down the importance of the comments and referred to previous statements, which have discussed the complexity of the tax issues and suggested that Shammo was addressing only part of the issue. We are sceptical about this response. Our view is that Vodafone can achieve this transaction with modest tax implications and the decision is about whether it wants to sell the asset for the price Verizon is prepared to pay.

Leisure group Whitbread added 31p to £24.50 as Nomura issued a buy note on the business ahead of its full year results on 30 April. The bank valued the group’s Costa coffee business at £1.8bn or £10 a share:

That implies £14 for the rest, a 27% discount to the net asset value in hotel and pub assets (£18.70) and, based on earnings per share excluding Costa of 122p, suggests only 11.5 times PE for a structurally growing hotel business. Add in the medium-term options for M&A (potential disposal of the pub restaurants) and we reiterate our high conviction buy call.

In a bad week for big name technology companies, there were disappointing updates from IBM, ebay and Yahoo. Meanwhile Apple fell below $400 a share for the first time since December 2011, ahead of results next week. The iPad company is expected to report the first year on year fall in quarterly earnings for almost a decade. The negative sentiment around Apple – whose shares stood at more than $700 in September – was reinforced during the week when one of its audio chip suppliers, Cirrus Logic, reported rising inventories, suggesting to analysts that iPhone sales may fall short of expectations.

Back in the UK, electrical engineering group Spectris slumped 317p to £19.08, or more than 14%, after it lowered its guidance for the year following a slow start. The news also hit FTSE 100 engineer IMI, down 19p at £11.74. Michael Blogg at Investec said:

While we anticipated a deceleration in the first quarter, the slowdown was broader and deeper than expected although we have no reason to believe that [Spectris] is losing market share. The company has successfully negotiated previous downturns and the cost reduction actions will help to underpin 2013 profits. The broad-based slowdown has significant read-across for other companies in our coverage. We place our forecasts under review and initially expect to downgrade by up to 5%.

Finally Mears, the social housing and domiciliary care company, climbed 17p to 335p after unveiling the £22.5m acquisition of Scottish provider Independent Living Services. The deal will be partially funded by placing of 6.4m shares at 310p and £2.8m of debt.

William Shirley at Liberum Capital said some investors had been hoping for a sale of Mears’ domiciliary care business, but this deal made such a move less likely.

Lloyds gets mixed response after City briefing as FTSE falls again on growth worries

Banking group gives presentation to analysts while investors sell off stock markets as economic concerns continue

As leading shares fell for the fourth day running, a presentation by Lloyds Banking Group designed to emphasise its future prospects received a mixed reception from its target audience.

Lloyds briefed City analysts on Tuesday afternoon on its commercial banking activities but Nomura kept its reduce rating following the meeting. It said:

Lloyds presented a target to achieve around £2.5bn of pretax profit by 2015 on £125bn of targeted risk weighted assets. This represents a 40%-45% increase in Commercial Banking pretax profits from current levels £1.75bn. Targets are equivalent to an earnings per share increase of around 0.8p. In contrast, we currently model Commercial Banking profit to increase to £1.9bn by 2015, mainly because we see revenue headwinds. With the current plan, costs seem unlikely to go down and we would argue that they would be flat at best.

We would be cautious on Lloyd’s ability to deliver on stated targets within the intended 2015 time frame in an economic environment which remains challenging.

Bank of America Merrill Lynch analyst Michael Helsby was more positive:

Whilst Lloyds was clearly keen to emphasis that it can pull different levers to achieve its goals, it appears clear that plan A is based on revenue growth (the commentary around costs and bad debts suggests a flattish trend) leaving income as the main driver. To facilitate the growth Lloyds management presented a very confident appraisal of their business lines in which self help, margin expansion, loan growth and enhanced product delivery throughout the franchise can deliver, even in a flat economic environment. In our view, this is a lot more upbeat than previous commentary and is presumably reflective of the improved margins, loan book growth in the first quarter of 2013 (earlier than expected) and building product success. Buy.

Lloyds slipped 1.125p to 48.225p but this was not a bad performance under the circumstances.

Overall, there was a widespread sell-off across global markets. A number of disappointing corporate results – including Bank of America and Intel – added to more general concerns about the global economy after the International Monetary Fund cut its growth forecasts and the ECB’s Jens Weidmann – the head of Germany’s Bundesbank – said Europe’s debt crisis could take a decade to overcome. Geopolitical concerns – including the Boston terror attack and worries about North Korea – also dented sentiment. An unsubstantiated rumour of a downgrade of Germany’s debt added to the febrile atmosphere.

So by the close the FTSE 100 was down 60.37 points at 6244.21, a near 1% decline, while the German and French markets were both around 2% lower. Wall Street was losing nearly 1% by the time London closed.

Commodities came under pressure again, not helped by continuing talk about a slowdown in China and news of poor European car sales, with copper falling to its lowest level since October 2011. Unsurprisingly, then, mining companies were among the leading fallers. Fresnillo – which also went ex-dividend – lost 87p to £10.74 while Polymetal dropped 38p to 706p and Kazakhmys closed 25.6p lower at 320.1p.

Tullow Oil slid 9%, down 97.5p to 982.5p after a disappointing update from its joint venture in French Guiana.

One of its partners Northern Petroleum announced that an exploration well on the Guyane Maritime permit would drill deeper after no hydrocarbons were found in the initial campaign.

The move to drill deeper is intended to give a better understanding of the potential of the area but will lead to a small delay to further planned wells. Northern’s managing director Derek Musgrove said:

Whilst the sand package in the primary target proved not to have significant hydrocarbons at this location, the oil staining encountered… is encouraging of the broader active hydrocarbon systems and potential.

Northern dropped 18.5% to 32p while another partner, Royal Dutch Shell, saw its A shares slip 24p to 2091.5p.

Later Tullow said the Northern statement was issued “without prior notice…. and without the approval of the operator or the joint venture partners.”

Tullow added that it believed the lack of hydrocarbonds was due to “a trap-specific issue and has no follow-on consequences for prospectivity elsewhere in the block.”

BAE Systems was 14p lower at 376.1p after its shares were quoted without the shareholder payout.

But Burberry added 23p to £12.89 after better than expected figures from the UK luxury goods group. Burberry said total second half revenues rose 9% to £1.11bn, with like for like retail sales up 7% and total retail revenues up 13%.

Hargreaves Lansdown was 49p higher at 949p after the fund management group issued a positive update, while utilities were again in demand for their defensive qualities. United Utilities, recently tipped as a bid target, was up 8.5p to 740p.

Reckitt Benckiser rose 6p to £46.55 after Bernstein lifted its price target from £50 to £53.

Meanwhile Arm was steady at 868p – despite going ex-dividend – after Goldman Sachs added the chip designer to its conviction buy list, a day after a sell note from Liberum Capital hit the company’s shares. Arm is due to report results next week amid concerns about a slowdown in smartphone sales and worries about increased competition. But Goldman said:

In our view, the recent pullback in Arm’s share price provides an attractive entry point into what we continue to view as one of the most compelling structural growth stories in European technology. Given a current rotation into quality in the sector, we favour structural growth combined with first-quartile industry positioning. Arm delivers these and …we expect news flow with the second quarter earnings on 23 April 23, Arm’s Investor Day on 21 May, and our annual Cambridge site visit on 11 June to underpin our positive thesis.

Among the mid-caps, Hikma Pharmaceuticals lost 67.5p to 917.5p after it decided not to sell its injectables business despite having received a number of unsolicited approaches. Analysts had put a value on the business of anything between $1bn and $2bn. Analyst Savvas Neophytou at Panmure Gordon said:

The shares could be weak but we see this as a sign the company feels there may be further growth in that business.

Pub and brewing group Marstons said the snow earlier this year affected trade across its estate and would mean first half operating profits would come in slightly below last year’s level. Despite higher interest charges on top of that, the company behind Pitcher & Piano and Brakspear beer said its full year trading expectations were unchanged. It said the second half had started well and it planned to open twenty new pub restaurants by the end of the year. Marston’s shares ended 2.1p better at 134.5p and analyst Nick Batram at Peel Hunt said:

Marstons is not the first pubco to comment on a tough first half impacted by the weather and won’t be the last. What is important is that the key proposition remains unchanged. Furthermore, second half comps are less challenging. The combination of valuation and yield remain attractive and we remain buyers of the stock.

Drive to appoint more women to boardroom failing, study shows

Lord Davies claims corporate world is making progress, despite fall in proportion of females appointed to FTSE boards

Lord Davies has insisted that corporate Britain is “stepping up and responding” to his call three years ago for more women to be appointed to boardroom roles, despite growing evidence that progress towards a more equitable gender balance has slowed.

For the last six months the percentage of female directors appointed to FTSE 100 and FTSE 250 boards has slipped to 26% and 29% respectively, according the latest report from the Cranfield International Centre for Women Leaders. This is well short of the 33% required to reach Davies’s target of a quarter of board posts being filled by women by 2015. It is also a marked slowdown on rates seen for the preceding six months – 44% and 36% for FTSE 100 and FTSE 250 companies respectively.

“Lord Davies’s target for FTSE 100 companies is still in sight but only if the rate of new appointments going to women regains momentum promptly,” warned Ruth Sealy, co-author of the Cranfield report. Only one in four of the stock market’s largest firms have so far met the target. The percentage of women on FTSE 100 boards jumped from 10.5% in 2010 to 15.6% in March last year, but had grown to just 17.3% by last month – again suggesting the pace of change was slowing.

Despite concern in some quarters, however, former Standard Chartered chairman Lord Davies, who separately publishes his progress report on Wednesday, is expected to play down the significance of six monthly statistics, emphasising: “We’ve come a long way over the past two years … I am pleased to say that the evidence clearly shows that [businesses] have, and are, responding.”

Business secretary Vince Cable conceded “momentum appears to be slowing” and suggested the latest updates from Cranfield and Davies would serve as a “timely reminder to business that quotas are still a real possibility if we do not meet the 25% target of women on boards of FTSE 100 companies by 2015″.

CBI president Sir Roger Carr insisted employers were alive to concerns about a slowdown in momentum. “These figures show if we are to remove blockages in the pipeline of female talent development, business leaders must roll up their sleeves and redouble their efforts to improve recruitment, mentoring and succession planning.” He also reiterated his opposition to proposals from Brussels for a quota system, insisting such measures would “do nothing to address the root causes of this issue”.

The Cranfield report also showed how progress was quickest among directors holding non-executive, part-time roles. Women hold more than one in five (21.8%) of non-executive FTSE 100 posts but still only account for little over one in 17 (5.8%) executive roles. That means there are just 18 women executive directors in Britain’s top boardrooms, against 292 men. Perhaps more alarming still, the Cranfield study found, among the broader top management tier at FTSE 100 firms – the key decision-making groups, known as executive committee members – the representation of women had fallen dramatically, down from 18.1% in 2009 to 15.3% today.

Susan Vinnicombe, co-author of the Cranfield report, suggested this shrinking pool of top-flight women managers made it harder for progress to be made with chief executive and finance director appointments. “Despite women dominating the fields of human resources, law and marketing … [executive positions in the boardroom] are still going to men, who are being promoted internally over experienced female candidates.”

Drive to appoint more women to boardroom failing, study shows

Lord Davies claims corporate world is making progress, despite fall in proportion of females appointed to FTSE boards

Lord Davies has insisted that corporate Britain is “stepping up and responding” to his call three years ago for more women to be appointed to boardroom roles, despite growing evidence that progress towards a more equitable gender balance has slowed.

For the last six months the percentage of female directors appointed to FTSE 100 and FTSE 250 boards has slipped to 26% and 29% respectively, according the latest report from the Cranfield International Centre for Women Leaders. This is well short of the 33% required to reach Davies’s target of a quarter of board posts being filled by women by 2015. It is also a marked slowdown on rates seen for the preceding six months – 44% and 36% for FTSE 100 and FTSE 250 companies respectively.

“Lord Davies’s target for FTSE 100 companies is still in sight but only if the rate of new appointments going to women regains momentum promptly,” warned Ruth Sealy, co-author of the Cranfield report. Only one in four of the stock market’s largest firms have so far met the target. The percentage of women on FTSE 100 boards jumped from 10.5% in 2010 to 15.6% in March last year, but had grown to just 17.3% by last month – again suggesting the pace of change was slowing.

Despite concern in some quarters, however, former Standard Chartered chairman Lord Davies, who separately publishes his progress report on Wednesday, is expected to play down the significance of six monthly statistics, emphasising: “We’ve come a long way over the past two years … I am pleased to say that the evidence clearly shows that [businesses] have, and are, responding.”

Business secretary Vince Cable conceded “momentum appears to be slowing” and suggested the latest updates from Cranfield and Davies would serve as a “timely reminder to business that quotas are still a real possibility if we do not meet the 25% target of women on boards of FTSE 100 companies by 2015″.

CBI president Sir Roger Carr insisted employers were alive to concerns about a slowdown in momentum. “These figures show if we are to remove blockages in the pipeline of female talent development, business leaders must roll up their sleeves and redouble their efforts to improve recruitment, mentoring and succession planning.” He also reiterated his opposition to proposals from Brussels for a quota system, insisting such measures would “do nothing to address the root causes of this issue”.

The Cranfield report also showed how progress was quickest among directors holding non-executive, part-time roles. Women hold more than one in five (21.8%) of non-executive FTSE 100 posts but still only account for little over one in 17 (5.8%) executive roles. That means there are just 18 women executive directors in Britain’s top boardrooms, against 292 men. Perhaps more alarming still, the Cranfield study found, among the broader top management tier at FTSE 100 firms – the key decision-making groups, known as executive committee members – the representation of women had fallen dramatically, down from 18.1% in 2009 to 15.3% today.

Susan Vinnicombe, co-author of the Cranfield report, suggested this shrinking pool of top-flight women managers made it harder for progress to be made with chief executive and finance director appointments. “Despite women dominating the fields of human resources, law and marketing … [executive positions in the boardroom] are still going to men, who are being promoted internally over experienced female candidates.”