You are on page 1of 40

BUSINESS WITH PERSONALITY

www.cityam.com FREE
FTSE 100 5,519.04 -26.34 DOW 12,079.66 -74.02 NASDAQ 2,657.22 -21.53 /$ 1.60 -0.01 / 1.17 unc /$ 1.36 -0.02
EUROPE faces its toughest hour since World
War Two, German Chancellor Angela
Merkel warned her ruling Christian
Democratic Union (CDU) party yesterday.
Her stark warning came as Italy slipped
further into financial crisis and markets
piled more pressure on the French and
Spanish governments by demanding a high-
er yield to buy their bonds.
The challenge of our generation is to fin-
ish what we started in Europe and that is to
bring about, step by step, a political union,
she told the CDUs annual congress.
Without sufficient rescue funding, the
euro may fall apart, she warned as she called
for stricter controls to stop countries build-
ing up unsustainable debts. We need better
budgetary control throughout the
Eurozone, she said.
The Chancellor was speaking as new
Italian Prime Minister Mario Monti attempt-
ed to form a government of technocrats to
solve Italys deepening financial crisis.
Italy had hoped that replacing Silvio
Berlusconi with Monti would calm bond
markets, but any fillip was short lived.
Yields shot up again after the government
was forced to pay an unsustainably high
interest rate on 3bn (2.57bn) of five-year
bonds auctioned yesterday. The yield came in
at 6.29 per cent, the highest level in 14 years
and well above the 5.32 per cent it paid just
last month.
Yields on Spanish ten-year debt rose above
six per cent, to 6.12 per cent, creeping closer
to the seven per cent mark beyond which
Greece, Ireland and Portugal took bailouts.
French yields also crept up by 0.038 to
3.424 per cent, taking the spread over bunds
to 1.643 percentage points.
The European Central Bank (ECB)
appeared to step in to buy Italian bonds in an
attempt to stop yields rising even further.
However, new figures from the ECB
showed it cut down bond purchases last
week, to 4.478bn from 9.52bn in the previ-
ous week, despite the increasing market tur-
moil as Berlusconis premiership finally
MERKEL: EURO
CRISIS WORST
SINCE WWII
BY TIM WALLACE
EUROZONE

came to a close.
Europes stock markets reacted badly to
the higher yields. Germanys DAX tumbled
1.19 per cent, the French CAC slid 1.28 per
cent and the FTSE 100 fell 0.47 per cent.
Monti, who announced that he plans to
stay in power until elections in 2013, has still
not appointed a government, leaving uncer-
tainty lingering over the future of Italys fis-
cal reforms.
Meanwhile, the San Francisco Fed warned
that the Eurozones economic woes were like-
ly to cross the Atlantic.
Its latest economic forecasts point to a
greater than 50 per cent risk of the US falling
into recession next year with the impact of
the Eurozone crisis on trade largely to blame.
Meanwhile, Angela Merkels party voted in
favour of offering struggling Eurozone mem-
bers an orderly way out of the currency
union.
The measure needs to be adopted by the
partys coalition partners to become policy. It
is part of Merkels plans to create a tighter
core of Eurozone countries. MORE: P4
Angela Merkel urged
closer Eurozone ties
Picture: REX
Issue 1,511 Tuesday 15 November 2011
Certified Distribution
03/10/11 till 30/10/11 is 100,123
EXCLUSIVE:
BANKS ROW
OVER 7.5BN
UNICREDIT
SHARE SALE
PAGE 3
German Chancellor says Eurozone situation
is most serious since peace broke out in
1945 as yields on sovereign debt shoot up
News
2 CITYA.M. 15 NOVEMBER 2011
London hit by
migration cap
LONDONS position as a global busi-
ness hub is being hampered by the
governments migration cap, accord-
ing to a report released this morning.
The migration limits are causing
businesses to postpone plans for
expansion, the City of London
Corporation has found.
Against the current backdrop of
continuing uncertainty [over the cap],
some global firms are reported to be
considering whether they could move
key business areas out of the UK, said
the groups policy chief Stuart Fraser.
International companies such as
these are also likely to employ large
numbers of British workers, with relo-
cation having the potential to damage
employment levels, the UKs pool of
skills and the tax revenue.
SMEs tell us that if they cant find
the right person for the job they sim-
ply wont recruit at all, Colin
Stanbridge of the London Chamber of
Commerce told City A.M.
In an increasingly competitive
global economy Londons businesses
find it hard to understand why the
government is looking to limit their
ability to recruit the best talent from
around the globe, Stanbridge added.
Home secretary Theresa May has
been charged with reducing net immi-
gration to tens of thousands each
year, not hundreds of thousands.
BY JULIAN HARRIS
ECONOMY

UK set for a decade of deleveraging


WELCOME to modern Britain, a
nation of over-leveraged debt junkies
only just waking up to the urgency of
mending its ways. Realising the scale
of the UKs long-standing addiction to
credit is vital to understanding why
growth forecasts are being cut left,
right and centre.
The real drag on demand in the UK
wont come from cuts to government
spending in the aggregate, these will
be worth just 0.7 per cent this year
and around half that in terms of
spending as a share of GDP. There will
be lots of pressure from elevated infla-
tion eroding the value of wages and
savings the pound has last 5.5 per
cent of its buying power over the past
year alone. But the biggest drag of all
will come from the private sectors
belated realisation that it must slowly
but surely tackle its imprudently high
levels of debt. This is a good thing
but like for a chastened patient wean-
ing himself from an addiction to
crack, the transition process for UK Plc
will be debilitatingly painful.
Households and non-financial com-
panies total borrowing as a share of
national income has so far declined
only very modestly. Their combined
debt peaked at a ridiculously high 231
per cent of GDP in the fourth quarter
of 2008, before falling back to 211 per
cent by the second quarter of this year,
according to an analysis of the figures
from Citigroup. At this rate (around 8
per cent of GDP per year), the great
private sector deleveraging journey
will take another decade. Private debt
needs to stabilise at a level compatible
with much higher interest rates (as
these are bound eventually to rise) and
far lower house prices (these are
already down 20-30 per cent in real
terms in the UK as a whole, with
prime central London the only
remaining island of buoyancy).
A decade of deleveraging means ten
years of reduced private sector
demand; it means ten years of weak
growth for retailers, restaurants and
others dependent on consumer spend-
ing. It also means that unless the
return on investment by companies
increases thanks to supply-side
reforms, or export markets expand
dramatically, the UKs trend economic
growth rate will probably stay stuck at
about 1.5 per cent a year. This will not
be enough for the Chancellor to meet
his borrowing forecasts and will there-
fore either force even greater austerity
or trigger a major crisis.
So far, corporate debt has dropped
from 122 per cent of GDP in late 2008
to 108 per cent today. Household debt
is down from 111 per cent at the start
of 2009 to 103 per cent today.
Depressingly, however, virtually all
the gains made by the private sector
have been cancelled out by our still
profligate public sector, which will
add around 120bn to the national
debt this year alone. Private debt
(excluding financial firms) plus public
debt is now equivalent to 291 per cent
of GDP, down only trivially from the
294 per cent at which it peaked in the
third quarter of 2009. It was 194 per
cent 10 years ago and 172 per cent 20
years ago. We remain roughly at the
level Japan reached during its darkest
hour 15 or so years ago.
The UKs total debt level is the third
highest in the EU: roughly the same as
Greeces (prior to the haircuts being
proposed). Only Portugal and Ireland
have higher amounts of debt. There is
no choice: Britain must deleverage.
Gordon Browns time in office will
eventually be remembered as the
years Britain borrowed itself to the
brink of disaster.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
DEUTSCHE Bank chief executive Josef
Ackermanns nine-year reign at the
top of Germanys largest lender will
end next year after the banker with-
drew his candidacy to join the supervi-
sory board.
The Swiss investment banker, who
will step down from the chief exec role
as planned in May, said extremely
challenging conditions on the finan-
cial markets meant he cannot spend
time seeking the support of sharehold-
ers for his bid to be board chairman.
Under German corporate gover-
nance rules, candidates need the sup-
port of 25 per cent of the shareholders
to be elected.
Deutsche said it will recommend
Paul Achleitner instead, the finance
chief of insurer Allianz, for the super-
visory board.
The surprise announcement came
hours after it emerged that police
searched Deutsche Banks offices over
a case in which Ackermann testified.
BY KASMIRA JEFFORD
FINANCIAL SERVICES

Ackermann exits in 2012


THE GOVERNMENT will today
announce plans to reform the Private
Finance Initiative (PFI), a highly contro-
versial method of funding the con-
struction of schools and hospitals.
Last night, a Treasury source said:
This will effectively mean the end of
PFI as we know it.
Treasury sources say the chancellor
wants to find a new way of tapping pri-
vate sector expertise and funding that
doesnt cost the taxpayer so much.
Gordon Brown signed off hundreds
of public construction projects using
PFI, which allows the government to
keep the liabilities associated with the
buildings off of its books.
But the method is incredibly costly:
more than 900 schemes have been
completed with a total capital value of
56bn yet the amount the taxpayer
currently has to repay is 229bn and
rising.
Chancellor set
to reform PFI
Ackermann was supposed to move over to become Deutsche Banks chairman in May
EDITORS LETTER
ALLISTER HEATH
Editorial Statement
This newspaper adheres to the system of
self-regulation overseen by the Press Complaints
Commission. The PCC takes complaints about the
editorial content of publications under the Editors
Code of Practice, a copy of which can be found at
www.pcc.org.uk
Printed by Newsfax International,
BeamReach 5 Business Park,
Marsh Way, Rainham, Essex, RM13 8RS
Distribution helpline
If you have any comments about the distribution
of City A.M. Please ring 0207 015 1230, or email
distribution@cityam.com
The coalitions home
secretary Theresa May
wants to reduce net
immigration to British
shores
4th Floor, 33 Queen Street, London, EC4R 1BR
Tel: 020 3201 8900 Fax: 020 7283 5334
Email: news@cityam.com www.cityam.com
Editorial
Editor Allister Heath
Deputy Editor David Hellier
News Editor David Crow
Acting Night Editor Marion Dakers
Business Features Editor Marc Sidwell
Lifestyle Editor Zoe Strimpel
Sports Editor Frank Dalleres
Art Director Jo Simpson
Pictures Alice Hepple
Commercial
Sales Director Jeremy Slattery
Commercial Director Harry Owen
Head of Distribution Nick Owen
BY DAVID CROW
POLITICS

FSA FACES CHALLENGE IN APPEAL


AGAINST FINE
The ability of the Citys watchdog to
punish senior executives for insuffi-
cient supervision is being challenged
in a test case by a former head of
UBSs wealth management opera-
tions in the UK. A tribunal yesterday
heard an appeal by John Pottage,
UBSs former head of wealth manage-
ment, against a 100,000 fine
imposed by the Financial Services
Authority in 2009 for allegedly not
putting adequate controls in place
when he took up the role in 2006.
LIBERTY AND ANGLO REACH DEAL ON
QUINN
Liberty Mutual Group and Anglo Irish
Bank yesterday completed the acquisi-
tion of Quinn Insurance, the Irish
insurance company formerly owned
by billionaire-turned-bankrupt Sean
Quinn.
EADS CHIEF APOLOGISES OVER A350
DELAY
The head of the European Aeronautic
Defence and Space company has apol-
ogised to shareholders for the latest
delay to a flagship aircraft pro-
gramme at Airbus, the groups main
subsidiary. Louis Gallois, EADS chief
executive, expressed regret at how
the introduction of Airbus long-haul
A350 aircraft had been pushed back
from the end of 2013 until the first
half of 2014, but insisted that the
problems would not undermine the
groups recovery.
ASSET MANAGERS JOIN DRIVE TO GET
MORE WOMEN ON FTSE BOARDS
Some of the UKs most powerful insti-
tutional investors are banding
together to help press FTSE compa-
nies to put more women on their
boards. The move is backed by repre-
sentatives from investment groups
with more than 1,000bn in stock
market assets.
HOT TUNA TO ABANDON THE STOCK
MARKET
Hot Tuna is to be taken private, leav-
ing only a cash shell as a quoted com-
pany. The perennially struggling
surfwear company said that trading
was worse than expected and that it
was difficult to raise finances to fund
a turnaround. Francis Ball, the execu-
tive chairman, said that the manage-
ment would stand down. [The sale]
would leave the plc as a cash shell
unencumbered by the brand. We will
go with the brand.
BANKS CONFRONT KINGFISHER OVER
DEBT
Kingfisher Airlines is set to meet its
lenders today, amid growing doubts
about its ability to continue operat-
ing without an emergency injection
of cash from its billionaire founder.
The company met last night to dis-
cuss a way out of the crisis.
CHRIS HOHN AMASSES $1BN STAKE IN
NEWS CORP AMID PHONE HACKING
SCANDAL
Chris Hohn, one of London's best-
known hedge fund managers,
amassed an almost $1bn (628m)
stake in Rupert Murdochs News Corp
as the media company was engulfed
by the phone-hacking scandal. The
Childrens Investment Fund (CFI),
founded by Mr Hohn in 2003, owned
53.8m of News Corps class A shares at
the end of September.
CODELCO FILES AN INJUNCTION TO
PREVENT ANGLO AMERICAN DEAL
Anglo Americans hopes of selling
another $5bn (3.1bn) stake in its
Chilean copper mines have been dealt
a blow after Codelco, Chiles state-
owned resources firm, filed an injunc-
tion to prevent a deal. Anglo surprised
markets in Chile by selling a 24.5 per
cent stake in its Chile Anglo assets.
LOWE'S PROFIT FALLS ON STORE
CLOSING CHARGES
Lowes fiscal-third-quarter earnings
fell 44 per cent as store-closing
charges masked the home-improve-
ment retailers slightly improved
same-store sales. Ricky Damron,
Lowes store-operations executive,
told analysts during a conference call
that same-store sales mostly
improved as customers along the US
East Coast bought roofing products,
dehumidifiers and cleaning supplies
to prepare for and clean up flooding
damage in the region.
ANADARKO RAISES COLORADO OIL -
FIELD TALLY
Anadarko Petroleum said that land it
controls in northern Colorado may
hold more than a billion barrels of
recoverable oil and natural gas, the
latest sign that US energy production
is set to surge.
WHAT THE OTHER PAPERS SAY THIS MORNING
UNICREDIT plunged back into the red
yesterday with a stunning net loss of
10.64bn (9.1bn) on the back of huge
write-downs to its asset pile.
Markets, which had been expecting
a profitable quarter, ditched the stock,
which fell 6.2 per cent by the close of
play. The bank also confirmed plans
for a 7.5bn rights issue.
The bank announced that it is likely
to cut some 6,000 jobs, 3.7 per cent of
its global workforce, by 2015. Some 150
of those will be lost in its City broker-
age, which the bank will outsource.
The huge quarterly loss came on the
back of an 8.67bn impairment on the
value of its assets, compared to no
reported change in their value during
the same period last year.
As City A.M. has reported, Italian and
Spanish banks are currently market-
ing billions in real estate portfolios
that market participants say have not
been written down by nearly enough.
Even without the write-down, how-
ever, the bank reported a quarterly pre-
tax loss of 1.05bn.
The bank had appeared to be on a
recovery path, booking pre-tax profits
for the past six quarters, but it broke
the streak in the third quarter.
UNICREDIT, one of the most weakly
capitalised of Europes big banks, has
surprisingly left two of the biggest
investment banks in the world off the
banking syndicate managing its
7.5bn (6.4bn) rights issue, accusing
them of being too demanding in nego-
tiating the terms of the deal.
Until last week Goldman Sachs and
Morgan Stanley were both set to par-
ticipate in the rights issue, one of the
biggest European deals for months.
Their exclusion is a major blow given
the slow market and a lack of deals.
According to four sources, the two
banks were determined to change the
structure of the deal to give them-
selves a hand in determining whether
it should be terminated in the event of
markets collapsing.
They were also unhappy with the
way the syndicate was put together,
which one source said was unusual
and went against typical procedures
for American investment banks.
Goldman, in particular, is used to
heading syndicates and was not con-
tent to rely on Bank of America Merrill
Lynch and Mediobanca, the lead advis-
ers, to judge the deals riskiness.
Goldman and Morgan Stanley suggest-
ed the so-called termination rights
should rest with a majority of the
bookrunners instead. But this request
was turned down.
These two banks wanted to have
their hand on the nuclear button and
I think they didnt reckon Unicredit
would stand up to them, one source
said. Others said that negotiations
with Goldman and Morgan Stanley
just ran out of time, with Unicredit
pinned to a strict timetable to
announce the details of the share
issue by yesterday morning.
The Unicredit issue is being viewed
as especially difficult because of the
volatile market conditions in Italy and
the Eurozone and the long lead time
before it goes through early next year.
Goldman and Morgan Stanley were
said to have been supported by JP
Morgan in their quest for greater con-
trol. JP Morgan was also initially left
out of the syndicate by Unicredit but a
flight out to Milan on Friday appears
to have retrieved the situation.
The syndicate has decided to use a
form of volume underwriting where-
by banks agree to take specific quanti-
ties of shares before they are priced.
Top US banks
shut out of
Unicredit deal
THE SAGE of Omaha has staked
his biggest ever bet on the tech-
nology sector after amassing at
5.5 per cent stake in IBM worth
$10.7bn (6.71bn).
Warren Buffett, one of the
most respected and revered
investors in the US, has histori-
cally shunned the sector on the
grounds he does not understand
it.
However, he said yesterday the
firms long-term growth plans
which have already seen it over-
take Microsoft as the second
biggest technology firm in the
world behind Apple were
enough to convince him to part
with his cash.
He said: I dont know of any
large company that has been as
specific on what they intend to
do and how they intend to do it
as IBM.
His Berkshire Hathaway
investment vehicle started buy-
ing the shares in March with a
target of stake of $10bn.
Buffett said IBM did not know
that he was building a stake and
that the company was finding
out about his investment for the
first time as he disclosed it on
television.
Shares in the conglomerate
have risen by a quarter in the
last six months.
Lender records 10bn loss as
its asset values go into freefall
BY DAVID HELLIER AND JULIET SAMUEL
CAPITAL MARKETS

BY JULIET SAMUEL
BANKING

Buffett has bucked his trend of avoiding tech Pic: REUTERS


BY STEVE DINNEEN
TECHNOLOGY

News
3 CITYA.M. 15 NOVEMBER 2011
NEWS | IN BRIEF
BofA to sell off China bank stake
Bank of America plans to sell most of its
remaining stake in China Construction
Bank Corp for $6.6bn (4.1bn) cash in
the ailing bank's latest move to boost
capital levels. The bank said last night
the new stake sale is expected to gener-
ate a gain of about $1.8bn after taxes.
MF Global sued over mass firings
MF Global Holdings is being sued by for-
mer employees for not giving 60 days
written notice before last Fridays firing
of all 1,066 at its broker-dealer unit,
court filings showed yesterday.
Meanwhile the US Commodity Futures
Trading Commission has issued a sub-
poena to Bank of Montreals Harris Bank
unit, seeking information about cus-
tomer accounts at MF Global.
Buffett secretly bought
up a $10bn stake in IBM
THE HEAD of Moodys in Europe has
fired a broadside at the European
Commission for proposing measures
that pin the blame on ratings agencies
for the euro debt crisis.
Speaking to City A.M., senior manag-
ing director Frdric Drevon said: The
proposals appear completely excessive
and not proportionate There is an ele-
ment here of shooting the messenger.
Most controversial among the new
rules expected to be unveiled today is
the suggestion that regulators should
be able to ban ratings agencies from
rating sovereigns in certain circum-
stances, such as when they have been
forced to seek a bailout.
Another proposal is that agencies
should have to submit their method-
ologies to the European Securities and
Markets Authority (ESMA) for vetting.
Investors will feel that there is a
loss of market integrity here. One of
the core building principles of ratings
agencies is their independence,
Drevon said.
The sovereign crisis will not disap-
pear because agencies are regulated in
this specific way It is instead likely to
be a very counter-productive measure
as the mere announcement that a rat-
ing is being withdrawn will signal to
investors that regulator has intervened
and is attempting to keep information
away from the market.
He added that the European
Commission has radically altered its
direction of travel since first embark-
ing upon the reforms, from reducing
regulatory reliance on ratings which
Drevon says Moodys would support
to curtailing freedom of opinion
and speech.
Meanwhile, Moodys released a note
yesterday suggesting that the designa-
tion of 29 banks as global systemical-
ly important financial institutions
boosts their credit rating because the
agency still believes they are too big
to fail and will be bailed out in the
event of a collapse, despite regulators
attempts to introduce orderly wind-
down regimes.
The agency also put Credit Suisse on
review for a downgrade, which it said
was due to its recent worse-than-
expected results.
Moodys: EU is
shooting the
messenger
BY JULIET SAMUEL
REGULATION

GERMAN construction group Hochtief


revealed it may have to write down the
value of its road contracts in Greece
due to mass toll dodging.
The news accompanied a gloomy
outlook for 2012 and a warning that
the group might post a loss this year if
it fails to sell its airport business on
schedule.
The economic crisis in Greece and
persistent mass toll dodging led to
major shortfalls in income develop-
ment for the toll road projects,
Hochtief said.
Hochtiefs third-quarter pre-tax prof-
it more than doubled to 333m
(285.3m) but missed estimates.
Hochtief hit by
Greek toll losses
CONSTRUCTION

SHADOW foreign secretary Douglas


Alexander said yesterday that Labour
could support the repatriation of
some powers to Westminster from
the European Union.
Alexander called for a pragmatic
approach and said that power grab-
bing should not be the top priority,
yet also added: [A] hard headed view
of Britains national interests should
be the hallmark of Britains approach
to the coming negotiations.
Labour must avoid being perceived
as supporting the status quo in
Brussels, Alexander said, calling for
reform to areas such as the Common
Agricultural Policy (CAP).
Labour to get
tough on Europe
POLITICS

THE SHADOW of the Eurozone crisis


darkened yesterday as more bearish
economic data emphasised the single
currency areas woes.
Yet another spell of economic con-
traction was confirmed in Portugal for
the third quarter of the year, confirm-
ing the bailout-recipients lingering
double-dip recession.
And across the 17-nation Eurozone,
industrial production was revealed to
have fallen by two per cent in
September, compared to August.
The decline was pretty broad-based
by country, said Ben May of Capital
Economics. The troubled Italian econ-
omy recorded a particularly steep
monthly decline of 4.8 per cent, sup-
porting our view that Italy needs more
than a change of government to solve
its problems.
The figures are prone to monthly
fluctuations, however. In August,
industrial production rose by 1.4 per
cent in the Eurozone and by one per
cent in the European Union area.
Yet downbeat business surveys point
to a potentially sharp contraction in
industrial production in the Eurozone
in the final three months of the year,
May added.
Meanwhile the Portuguese econo-
my shrank by 0.4 per cent in the three
months to September, according to an
official estimate. Compared to a year
earlier, GDP was down 1.7 per cent.
Industry declines in the Eurozone while
Portugal falls even deeper into recession
BY JULIAN HARRIS
EUROZONE ECONOMY

News
4 CITYA.M. 15 NOVEMBER 2011
Portugals PM Pedro Passos Coelho
ANALYSIS l Real Portuguese GDP -
change on previous quarter %
Years 07 08 09 10 11
1
2
0
-1
-2
-3
Date January 22 February 11 March
Insured loss
Date April
Insured loss
Date September
Insured loss
Date August - September
Insured loss
Source: Insurance Information Institute, Equecat Pictures: REUTERS
CATASTROPHES this year piled pres-
sure on Lloyds insurers Catlin and
Hardy Underwriting, with the compa-
nies saying high levels of losses this
year had cut into their profitability.
Catlin said its losses from the spate
of disasters experienced this year had
risen to $670m (417m) from $534m
initially estimated. It booked $275m
in the first quarter alone after Japans
earthquake in March.
Hardy said major catastrophes had
pushed its combined ratio, a measure
of its solvency, from a healthy 78 per
cent to an unprofitable 111 per cent
in the first nine months of this year.
Anything over 100 per cent shows
claims and expenses exceeding pre-
mium income.
Catlin chief executive Stephen
Catlin said the unprecedented level
of serious catastrophe losses, com-
bined with low premium rates as
insurers fought for business, was like-
ly to cause a dramatic overhaul of the
market for insurance.
We believe that fundamental
changes in the marketplace are on
the horizon as a result, he said.
Hardy also warned its losses could
rise further due to continued uncer-
tainty regarding the New Zealand
and Japan earthquake losses and the
quantum of the claims arising from
the recent flooding in Thailand.
Catlin and Hardy wrote more busi-
ness than in the first nine months of
2010 as they focused on the divisions
seeing the biggest rate rises.
Catlins gross insurance premium
revenue was 3.7bn, 12 per cent high-
er in the first nine months of 2011
than in the same period in 2010, as its
reinsurance arm grew 26 per cent.
Hardy increased gross premium
income by 21.8 per cent to 278.1m,
as it too grew reinsurance and non-
marine property divisions.
Insurers see
disaster costs
mount in 2011
BY ALISON LOCK
INSURANCE



















Have you been put at risk?
Do you want advice on your exit
strategy?
SW19Lawyers is a specialist employment
law firm based on Cornhill and in SW19.
Contact us to book an appointment or
discuss your issues on 0208 947 7997 or
email
belinda.eriksson@sw19lawyers.co.uk or
jennifer.ison@sw19lawyers.co.uk
www.sw19lawyers.co.uk
News
7 CITYA.M. 15 NOVEMBER 2011
ANALYSIS l Catlin Group Ltd
p
8Nov 9Nov 10Nov 11 Nov 14Nov
400
395
390
385
392.80
14 Nov
ANALYSIS: CATASTROPHES CAUSED $68BN (42.3BN) OF INSURED LOSSES IN THE FIRST NINE MONTHS OF 2011
$2.6bn $13bn $30bn
FLOODS, QUEENSLAND EARTHQUAKE, CHRISTCHURCH EARTHQUAKE, HONSHU
TORNADOES, ALABAMA
$7.3bn
FLOODS, THAILAND
$5bn +
HURRICANE IRENE
$7bn
Subject to terms, conditions and availability. Valid for travel until 24 Mar 12. Book by 21 Nov. Limited availability over peak travel periods,
holiday periods and sporting events. Handling fee per passenger per one-way ight: 6 per credit/debit card transaction may apply.
Supplement applies for travel Fri - Sun.
News
8 CITYA.M. 15 NOVEMBER 2011
Liberums quest to borrow a big balance sheet
T
HERE can be no doubting that
the long-expected consolidation
in the small to mid-cap broker
market has well and truly
begun. In the past few weeks there
have been deals to buy Ambrian (RFC),
Arbuthnot Securities (Westhouse),
Evolution (Investec) and Merchant
Securities (Sanlam). Such deals follow
an earlier transaction in February of
last year when the Portuguese Bank
Espirito Santo bought a 50 per cent
stake in Execution Noble, one of the
Citys larger mid-cap brokers, for
50m.
As the deals progress, uncertainty
hangs over many of the employees in
the sector. Evolution employees, for
example, have several more weeks to
wait to hear their fate as a result of
Investecs recent 200m deal to buy
the broker. Evo was considered presti-
gious enough to be on the ticket
advising Nat Rothschild, Tony
Hayward and Julian Metherell in
their money-raising exercise for their
blank cheque company Vallares.
In such an environment, all the
major players in the industry are
examining their options. One such is
Liberum Capital, the well-respected
independent broking house that
managed to win itself a seat in the
room for one of Londons biggest IPO
of all time, the recent flotation of
Glencore.
Liberum, whose chief executive is
former Collins Stewart and Beeson
Gregory stalwart Simon Stilwell,
walked off with a sizeable fee for its
advisory and research work on
INSIDE TRACK
DAVID HELLIER
Glencore the firm possesses one of
the best respected experts in the com-
modities trading sector in former
Cazenove star Michael Rawlinson
but did not maximise its potential, by
being unable to participate in the
underwriting for the issue.
Hence, Liberum, I have been told,
has in recent weeks been holding ten-
tative talks about borrowing a bal-
ance sheet, which would mean
coming to an agreement with a third
party bank that could provide it with
the balance sheet presence it might
need in future Glencore-type situa-
tions.
Such agreements are not
unknown. Oriel Securities, for exam-
ple, has had tie-ups with the likes of
Scotia Bank and Standard Bank, to
help it offer clients the kind of finan-
cial firepower on underwritings and
fund-raisings it can not offer off its
own back.
And Peel Hunt, which was bought
out from KBC by its management, has
an agreement with Credit Suisse,
whereby the Swiss bank provides a
credit line to the brokers trading
side.
Then theres the famous example
of JP Morgan and Cazenove, where JP
took a big stake in the blue-blooded
broker in a move that later heralded a
fully fledged takeover when the two
had gotten to know each other better.
Liberum is adamant that this is not
the kind of thing it has in mind, but
has its heart set on something more
along the lines of the Oriel or Peel
Hunt model, I am told.
Some in the City, however, are intol-
erant of the borrowing of a balance
sheet idea, and are quick to write it
off as a means of going forward. Im
incredibly sceptical of the idea, one
banker told me. In real life it doesnt
work because the client wants to
know that youve got the go-ahead for
an underwriting but in reality the
bank youre partnering with will
want to assess the situation for itself
and may well reject it and the whole
process could take some time.
Liberum, which is growing strongly
in its current guise as a fully inde-
pendent employee-owned broker with
revenues around 47m last year,
stresses that it doesnt need to do any
deal with its balance sheet to grow
further. It is in any case keen on
organic growth in regions where it
sees huge potential, such as in the
China and Hong Kong region. But
there will clearly be some interesting
conversations in the weeks ahead.
david.hellier@cityam.com
Follow me on Twitter@hellierd
Apple, the Apple logo, and iPad are trademarks of Apple Inc., registered in
the U.S. and other countries. App Store is a service mark of Apple Inc.
You wanted the best
platform features
So we give you
Next Generation trading
Losses can exceed your initial deposit
Try out our Next Generation
platform features for free on a demo
account at cmcmarkets.co.uk
CFDs revolutionised
Trading from charts
Tight spreads
Customisable margin
Fractional trading
Automated Stop Loss
Spreads may widen dependent on liquidity and market volatility
CAMERON has used his Lord Mayors ban-
quet speech to describe the euro crisis as
an opportunity for fundamental
reforms to the European Union, calling
for a renewed focus on growth, lower
spending and less regulation.
He also suggested that it was in
Britains interests to allow more trade
with firms from countries such as Russia
with less than perfect human rights
records.
I simply refuse to accept we have to
choose between politics and trade... This
is the place the planet looks to raise capi-
tal, float a business, set the price of the
goods which power the world economy,
he told the Guildhall.
In his annual foreign policy speech, the
Prime Minister asserted that Britain had a
profound national interest in helping to
resolve the EU crisis and maintaining its
influence in the 27-member bloc.
He added that Britain needed to focus
on forging stronger relationships with
countries like Brazil, Russia to improve its
prospects in an increasingly competitive
global environment.
PM calls
for Euro
reforms
BY KASMIRA JEFFORD
POLITICS

News
10 CITYA.M. 15 NOVEMBER 2011
BANK of New York Mellon said it
expects its fourth-quarter profit to
be hit by a programme of cost-cut-
ting to save up to $700m (440m),
before taxes, by 2015.
In its investor day presentation yes-
terday, the bank estimated incremen-
tal expenses of up to $100m the
current quarter as it begins to roll out
its cost-cutting programme, which
will including shedding expensive
real estate and consolidating some
facilities.
BNY Mellon
warns of cuts
BANKING

THOUSANDS of civil servants have


voted in favour of a national strike at
the end of the month over pension
reform, two unions said yesterday,
bringing the prospect of a national
stoppage involving millions of work-
ers a step closer. The FDA union, rep-
resenting 19,000 senior government
worker, said that on a turnout of 54
per cent, 81 per cent had voted in
favour. Prospect, which represents
30,000 civil servants, said members
voted three to one in favour of action.
Civil servants
endorse strike
POLITICS

David Cameron speaking at the banquet hosted by the new Lord Mayor David Wootton and the Lady Mayoress Picture: Laura Lean
Justice secretary Kenneth Clarke, Speaker John Bercow, and Samantha Cameron at the Lord Mayors banquet Pictures: Laura Lean
SHARES in Hugo Boss dived yesterday
after Permiras decision to cash in
some of its shares sparked fears the
private equity group would offload
the rest of its stake in the German
fashion house.
Hugo Boss closed down 6.36 per
cent at 67.98 after holding company
The Red & Black, controlled by
Permira, said it would sell 4.5m prefer-
ence shares, or 6.4 per cent of the total
share capital.
Joerg Rockenhaeuser, head of
Permira Germany, denied the deal was
the start of an exit from the firm,
which recently posted a surprise 30
per cent rise in quarterly profit. Hugo
Boss has continued to perform very
strongly under the leadership of CEO
Claus-Dietrich Lahrs, he said.
Rockenhaeuser has previously
insisted there is no direct link between
the 2015 date for the Hugo Boss busi-
ness plan and an exit date for Permira.
Yesterdays deal means Red & Black
will still hold 66 per cent of Hugo Boss
capital and control 89 per cent of its
voting rights. Citigroup has been man-
dated as bookrunner for the sale.
Permira has made a commitment
not to sell any more of its shares in the
retailer for the next six months.
The buyout firm took a stake in
Hugo Boss in 2007 as private equity
piled into the booming luxury goods
sector in China, India and Russia.
Terms apply. Subject to credit check.
Get an extra
300 minutes
With the free Samsung GALAXY S II
on a 36 plan
Call 08080 99 00 00
before 4pm for next day phone delivery
Visit vodafone.co.uk/galaxys2
or go to your local Vodafone store
Lines open 7 days a week, 8am-8pm, except bank holidays. Call us free on your
landline; standard network charges apply to all calls made froma mobile phone.
Price on a 24-month contract
Mins to all UK mobiles & UK landlines
(starting 01, 02, 03)
Standard UK texts
UK mobile internet
Wi-Fi access with BT OpenZone within UK
36
600 900 minutes
Unlimited texts
500MB
1GB
Samsung GALAXY S II
a month
Was 600
now 900
minutes
Call us today to find out more about our new
3 month Data Test Drive offer
Permira sell-off sparks
Hugo Boss stock slump
BY PETER EDWARDS
PRIVATE EQUITY

News
12 CITYA.M. 15 NOVEMBER 2011
MORE NEWS
ONLINE
@
www.cityam.com
Walking tall: Hugo Boss posted strong profit growth in Q3 Picture: REUTERS
NEWS | IN BRIEF
More jobs cut at Japanese banks
Mizuho will cut 3,000 jobs as Japanese
banks battle weak demand for credit at
home and a tough global growth environ-
ment, which saw half-year profits at the
lender and smaller rival Sumitomo Mitsui
fall by a quarter. Mizuho Financial Group
said yesterday it plans to axe the jobs,
about five per cent of its workforce, by
March 2016 through merging its corpo-
rate and retail banking units. First-half
profits at Japans second-biggest lender
by assets slid, as the previous year's bond
trading gains slowed. Third-ranked
Sumitomo Mitsui Financial Group
(SMFG), whose profits also fell 25 per
cent, also said it will buy back up to
50bn (31.4bn) worth of its shares, or
1.63 per cent of its outstanding stock.
The news of job cuts follows a raft of
redundancies announced at leading
Japanese brokerages Nomura and Daiwa.
WINE retailer Majestic yesterday
said it remained cautiously opti-
mistic after its Christmas promo-
tion got off to a good start, despite
registering the first dip in sales
since 2009.
Sales at UK stores open for more
than a year fell by 1.1 per cent in the
six weeks to 7 November, after two
weeks of disappointing perform-
ance in mid-October.
Majestic shares dropped on news
that sales had slowed, shedding 3.85
per cent to close at 400p, valuing the
firm at 246m.
Steve Lewis, chief executive, told
City A.M.: October is not a high
turnover period, and trading has
improved since then. Weve seen a
good response to our Christmas pro-
motions and we are cautiously opti-
mistic.
What weve seen time and time
again this year, is that when people
do want to spend money they will
do so whether its Easter, June, the
warm weather in September or
Christmas.
Majestic reported first-half pre-tax
profit of 8.8m, a jump of 20 per
cent on a year earlier, on total sales
that grew 8.7 per cent to 127.8m.
UK like-for-like sales in the first half
were up 2.7 per cent excluding VAT.
However, the average selling price
was up by 6.9 per cent in its first
half, suggesting that volumes
dropped by 4.2 per cent.
Analysts at Oriel said the boost
Majestic received after it halved the
minimum purchase from 12 bottles
to six in September 2009 was pass-
ing, adding the firm would strug-
gle to grow earnings as quickly from
now on.
Lewis said sales of its fine wine
collection bottles priced at 20 or
higher had grown by 20 per cent
over the period.
He added the firm would contin-
ue to expand, adding 13 stores to its
UK portfolio before the end of its
financial year.
Majestic still
upbeat after
a dip in sales
Steve Lewis: optimistic Picture: REX
BY DAVID CROW
RETAIL

News
13 CITYA.M. 15 NOVEMBER 2011
Wine merchant gives supermarkets run for money
WHEN Majestic halved its minimum
purchase from 12 bottles to six in
September 2009, it transformed the
business. Customers who had never
shopped there before gave it a try;
profits and sales have grown at dou-
ble digit rates ever since.
Until now. In the first six weeks of
its second half, like-for-like sales
dipped by 1.1 per cent, causing
investors to question Majestics pre-
mium rating (the shares trade on an
earnings multiple of 15.7 times).
Majestic puts the negative sales
growth down to two poor weeks in
October, which has always been a
tough month. But the like-for-like
sales trend has been decelerating for
some time now. In the first ten weeks
of the second half, they grew by 4.4
per cent excluding VAT, falling to 1.6
per cent in the next sixteen.
Yet we see yesterdays share price
weakness as a buying opportunity.
Although the effect of the six bottle
minimum is petering out, there is
still room to grow. As well as continu-
ing to benefit as consumers shift
from beer to wine, we reckon
Majestic will carry on stealing share
from rivals. So far, it has benefited
from the demise of the smaller wine
merchant. But it is also giving the
supermarkets a run for their money.
Indeed, it is the supermarkets who
ape Majestic these days the stock
and promos on offer in Sainsburys
Waitrose look increasingly similar to
its own offering.
There is one area where the super-
markets cant compete, however: cus-
tomer service. Almost 100 per cent of
Majestics staff have a degree and
they are well-versed in wine. Taken
with purchasing power that allows it
to sell decent Rioja Reserva and New
Zealand Sauvignon Blanc for 5.99,
and you have a unique retailer, and
one that is worth sticking with for
longer. Just like a decent wine.
BOTTOMLINE
Analysis by David Crow
ANALYSIS l Majestic sales and profits
m
Revenue
233.2m
257.3m
280.8m
318.6m
345.5m
Year (*Investec estimates)
2010 2011 2012* 2013* 2014*
400
350
300
250
200
150
100
50
Profit
29m 26m
22.5m
20.3m
16m
HE IS the star fund manager whose
stock picks have been the envy of the
City for the best part of 30 years. Now,
however, a year after Anthony Bolton
left Britain for Hong Kong, he has
found life is far from easy in the East.
Yesterday Bolton (pictured)
apologised to investors for
the very poor perform-
ance figures of his
Fidelitys flagship China
fund.
I can give no excuses
except to say performance
has been very disap-
pointing particularly
in the three months
to the half-year end,
he said.
The net asset value
of the Fidelity China
Special Situations fund
fell 28.9 per cent in the
six months to 30
September, underperforming a 24.5
per cent fall in the MSCI China Index.
Boltons fund, which had net assets
of 490m on 30 September, bought
back some of its shares to boost
investor confidence in September.
The Brit said his optimism for
Chinese prospects has been severely
tested but added that his trust has
seen a partial recovery, which he
hopes will continue in 2012. He also
said he had been wrong to believe
Chinas stock market could decouple
from Western equities, particularly
given Chinas exposure to the mis-
guided experiment of the euro.
The combination of the
very difficult stock mar-
ket background, the
companys exposure to
the more volatile medi-
um and smaller capitali-
sation Chinese stocks
and the companys gear-
ing has produced some
very poor performance
figures.
Boltons blues
over slump in
Chinese fund
BY PETER EDWARDS
ASSET MANAGEMENT

News
CITYA.M. 15 NOVEMBER 2011 15
RateSetter: A better way to Save and Borrow, Peer to Peer
www.RateSetter.com Customer Phoneline: 08442490115
CITY VIEWS: DO YOU THINK CHINAS BOOMING GROWTH CAN LAST?
Interviews by Phoebe Torrance
Personally, I think
Chinas economy can
keep growing and is not
set for any sharp drops or
slow downs. It is very con-
sumer-led and I think
that consumer-led growth in
China will rise a lot over the
next ten years.
CHRIS VAUGHAN |
OPTITRADE
I think that it can sus-
tain itself short-term.
China has a lot of
resources and they have
been buying into estab-
lished European mar-
kets. Long-term it
depends on the fate of
other markets.
JIM COYNE |
MIZUHO BANK
I suspect it could slow,
possibly to a low of six to
seven per cent. Global
growth is slowing, and the
Eurozones inevitable crash
and the problems in the
US will impact China.
GDP will grow, but at a
slower pace.
NEIL BRIERLEY |
COLLINS STEWART
* These views are those of the individuals above and not necessarily those of their company.
AT A GLANCE: BOLTONS TAKE ON MARKETS, THE WORLD AND WAR
Market view
Bolton struck a bullish tone in his half-
yearly message to investors, despite a
most disappointing six months.
He said a strong market recovery was
"likely" over the next few months after
sentiment plunged at the beginning of
October to the lowest levels he had
seen in his career.
The most important reason that I
remain optimistic about stock markets
is my contrarian nature," he wrote.
"However, valuations are very attrac-
tive versus history and Hong Kong
directors' purchases of shares are the
second highest they've been in the last
11 years (only higher in 2008).
Everywhere risk is off.
He went on to say that markets often
move to prove the majority wrong.
Global economy
Bolton said there are "significant dif-
ferences between the current crisis and
the fall-out from the collapse of
Lehman Brothers in 2008.
He said the US authorities will throw
everything they have at their economy
and sees Europe as the "epicentre" of
the current crisis.
A Chinese sell-side strategist warned
Bolton that the future of the Eastern
nation is "completely tied up with the
future of Europe" but Bolton said a
major recession is not inevitable.
"Ultimately the politicians will have to
decide between political union or
breakup, but I believe this is still a few
years away. In the short term, it
remains to be seen whether the latest
package is enough to calm markets."
Korea concerns
Bolton has not been shy of criticising
nuclear-armed North Korea and in June
he spoke of his fears that the South
could retaliate against acts of aggres-
sion from Kim Jong-il, triggering a
slump in Chinese equities.
Yesterday Boltons comments showed
his worries have eased.
During August, the Americans restart-
ed a dialogue with North Korea which
is a significant positive development. In
September I closed the Kopsi put
option position at a significant profit.
The Norths uranium enrichment pro-
gramme, which opens a second route
to make an atomic bomb along with its
plutonium programme, has long been a
source of concern to the United
Nations.
THE DAILY Mirror and The Sun are at
risk of being dragged into the phone
hacking scandal that led to the closure
of the News of the World, according to
an independent inquiry into press
standards.
The Leveson inquiry has discovered
a name relating to the Daily Mirror in
a notebook used by the shamed pri-
vate investigator at the heart of the
affair, as well as references to The Sun.
Both papers deny any wrongdoing.
It has also discovered at least 28
News of the World employees listed in
Glenn Mulcaires notebooks, the
majority of whom were listed under
code names. One person, referred to as
A, had requested information from
the convicted fraudster 1,453 times.
Altogether the inquiry has exam-
ined some 11,000 pages of Mulcaires
notes, showing thousands of requests
for information on almost 6,000
potential victims.
The revelations add further cre-
dence to the long-held suspicions of
many critics that the phone hacking
culture ran to the very core of the
News of the World. Robert Jay QC,
counsel for the inquiry, said manage-
ment at the paper must either have
known about the practice or allowed a
serious breakdown in supervision to
occur.
The inquiry, which will not be limit-
ed to phone hacking, will hear evi-
dence from high profile figures over
the coming weeks relating to a string
of unlawful or unethical practices.
Mirror and
Sun named in
hack inquiry
BY STEVE DINNEEN
MEDIA

Lord Justice Leveson will hear evidence on media standards Picture: REUTERS
News
16
ITV yesterday showed it still has the X
Factor, reporting an jump in advertis-
ing revenue off the back of the Rugby
World Cup and hit shows like
Downton Abbey.
However, the broadcaster is expect-
ing the ad market to cool over an icy
Christmas period, with projected rev-
enues dipping as much as 10 per cent
in December.
Advertising in the third quarter
outperformed the market with an
increase of one per cent, helping to
boost its shares 3.3 per cent yesterday.
The firms production arm, ITV
Studios which chief executive Adam
Crozier said must improve its per-
formance when he took over last year
continued its forward momentum,
with revenues up nine per cent year-
on-year to 224m.
Overall revenues for the nine
months to the end of September
jumped four per cent to 1.5bn, with
the market share for ITVs family of
channels increasing two per cent to
take 23 per cent of the total.
Crozier said: The continued man-
agement emphasis on cash genera-
tion and cost reduction has delivered
further improvements to our finan-
cial position and we are on track to be
net cash positive at year end. This is a
substantial improvement given that
our net debt stood at 612m at the
beginning of 2010.
We remain cautious on the out-
look for 2012 with tough compara-
tives continuing into the first quarter
before easing from the second.
ITV shows it
has X Factor
as sales rise
Sage slapped with legal bid
SAGE Group is embroiled in a legal
row with an Australian private equity
outfit over its decision to walk away
from talks to buy MYOB.
Archer Capital, which owned a stake
in the Melbourne-based firm, has
launched a lawsuit thought to be
worth in the region of 83m arguing
the eventual sale of the business came
in at around $100m less than Sage had
offered. Software giant Sage released a
statement saying it strongly rejected
the claims, adding it will defend itself
vigorously.
US private equity house Bain Capital
eventually agreed to buy the account-
ing software company for about
$1.3bn (790m), fending off interest
from private equity outfit Kohlberg
Kravis Roberts. Sources close to the
deal said at the time Sage was forced
to abandon its bid because of a cooling
of market conditions and a lack of
shareholder support. It had appeared
to be favourite after entering exclusive
talks with MYOBs private equity own-
ers, tabling an offer of around 885m.
Law firm Allen & Overy is advising
Sage on the case.
BY STEVE DINNEEN
MEDIA

BY STEVE DINNEEN
TECHNOLOGY

THE DISTRIBUTOR of the Twilight


franchise and owner of kids favourite
Peppa Pig swung to its first six month
profit since stepping up to the LSE
last summer.
Entertainment One (E1) posted pre-
tax profits of 9.8m, up from a loss of
1.5m a year ago. Its revenues were up
one per cent to 204.6m.
The company said it benefitted
from its deal with LoveFilm but did
not break the results out. It is expect-
ing a boost from the launch of the lat-
est installment of the Twilight saga,
which is out on Friday.
Peppa Pig continued trotting to
world domination, rising to the num-
ber one slot in Australia as well as hit-
ting prime-time in the US. E1, which
owns image rights to the pink super-
star, will also be hoping to cash in on
merchandise this Christmas.
Twilight firm sinks its
teeth into a juicy profit
MEDIA

News
17 CITYA.M. 15 NOVEMBER 2011
NEWS | IN BRIEF
Yell asks for loan flexibility
Yellow pages publisher Yell Group has
launched a loan amendment process
aimed at reducing and refinancing its
2.6bn debt as it does not expect to
grow by 2015. Yell asked lenders to
relax its loan terms to provide it with
the flexibility to explore ways to reduce
its long-term borrowings. It intends to
buy back loans using 108m of its cash
at a discount and cancel them reduce
leverage. It plans to eventually refinance
its loans with non-bank funding, such as
high-yield bonds.
Eros sees its profits soar
Bollywood film giant Eros enjoyed an
Indian summer yesterday as its revenues
soared 35 per cent to hit $92m (57.9m).
It spiced up its balance sheet with pre-
tax profits of $29m, up four per cent
year-on-year. It enjoyed a bumper year of
Bollywood hits including the release of
Ready, Zindagi Na Milegi Dobara, Murder
2 and Mausam, giving it three of the top
five Indian theatrical film releases this
year. It says its film outlook slate is
strong until at least 2014.
Blinkx sees its shares tumble
Video search firm Blinkx yesterday experi-
enced a delayed-reaction tumble, as
investors appeared to change their minds
about its results last week. The Autonomy
spin-off saw its shares plummet nine per
cent after negative sentiment gathered
over the strength of its core business, once
the acquisition of US-based ad network
Burst Media is stripped out. Collins
Stewart analyst Mike Jeremy said the sell
off appears unwarranted, with the firm
having made it clear the acquisition was
intended to extend Blinkxs reach and not
simply a bolt-on to drive earnings.
ANALYSIS l ITV
p
8Nov 9Nov 10Nov 11 Nov 14Nov
67
65
66
64
63
62
65.75
14 Nov
ANALYST VIEWS: HOW GOOD ARE ITVS
THIRD QUARTER RESULTS? Interviews by Steve Dinneen

IAN WHITTAKER | LIBERUM CAPITAL


ITVs third quarter ad revenue performance was in line with expecta-
tions, but the fourth quarter looks to have started well. We expect consen-
sus upgrades of four per cent at the adjusted earnings per share level.

LORNA TILBIAN | NUMIS


We retain our positive stance on ITV, which is making good operational
progress and benefits from an ungeared balance sheet that provides
optionality for share or bond buybacks and/or acquisitions.

JONATHAN JACKSON | KILLIK & CO


ITV remains on track to outperform the TV advertising market in 2011.
The new ITV Studios management team is delivering ahead of expecta-
tions and the group continues to make progress with its five-year plan.

The X Factor was a hit for chief executive Adam Crozier (inset) Pictures: REX/REUTERS
ANALYSIS l Sage
p
8Nov 9Nov 10Nov 11 Nov 14Nov
282.50
280.00
277.50
275.00
272.50
277.10
14 Nov
DOWNTON LORD LANDS
IN THE LAP OF LUXURY
HE SURVIVED the Great War and
Spanish flu and yesterday Lord
Grantham aka the actor Hugh
Bonneville made his first public
appearance since the end of series two
of Downton Abbey to present the
Walpole awards for excellence.
No austerity measures at the luxury
bodys annual gathering, held in asso-
ciation with Coutts just champagne
and medals for the expensive end of
the stock market: British Luxury
Overseas for Mulberry, International
Luxury Brand for Herms and Best
British Craftsmanship for Churchs
shoes, as judged by sharp-suited prop-
erty tycoon Nick Candy.
So there werent too many long faces
among the leaders of the Western
brands lifted out of the Eurozone gloom
by spendthrift Asia-Pacific shoppers:
Herms managing director Thierry
Outin, Net-a-Porter founder Natalie
Massenet and Jaguar Land Rovers
design director Gerry McGovern, to
name but a well-heeled few.
Boosting the British economy, mean-
while, was McLaren Automotives
chairman Ron Dennis, poised to issue
a call to arms to UK manufacturers
on Thursday, when he creates 300 new
jobs by opening a 50m sports car fac-
tory in glamorous Woking.
PARTY POSTPONED
IT WOULD have been a contender for
party of the year: a top-level gathering
of private equity bosses held inside St
Pauls Cathedral.
This will be a unique event thanks
to the unprecedented access we have
been granted to St Pauls Cathedral and
the exceptional mix of senior figures
who will be joining the celebration,
trumpeted Private Equity International
(PEI) magazine on its smart purple invi-
tations to mark its tenth birthday and
100 issues on 29 November.
Alas, even the best-laid plans of pri-
vate equity royalty can go astray
when barbarians at the gate are
hungry for the scalps of the Southern
Cross infidels and their associates.
Cue a postponement of the party,
which as yet has no new date. Well
be in touch, assured PEI as the pro-
testers bedded in for the long haul.
ALICE IN PR-LAND
WHERE now for Alice Macandrew, the
exiting Europe and Asia comms chief
for News Corp, who resigned from the
Murdoch empire in July over reported
disagreements over the handling of the
phone hacking scandal?
The Capitalist hears the well-regarded
Macandrew is in hot demand in the
jobs market since voluntarily quitting
as James Murdochs chief press aide
so might she expect a job approach
from financial PR firm Finsbury?
After all, Macandrew enjoyed a
nine-year run at Roland Rudds opera-
tion, now RLM Finsbury, before mov-
ing to the News Corp hot seat in 2009.
Wed love to have her back if she
was interested, said a Finsbury
source. Over to Macandrew
The Capitalist
18
EDITED BY HARRIET DENNYS
Got A Story? Email thecapitalist@cityam.com
Follow The Capitalist on Twitter: @dennysharriet
Hugh Bonneville, who plays Lord Grantham in Downton Abbey, hosted the Walpole awards
News
19 CITYA.M. 15 NOVEMBER 2011
LAW firm Eversheds said yesterday
that its performance in the first half
of the year had been positive, with
revenues climbing seven per cent
compared to the same period last
year.
Revenues increased by 11.5m on
the first half of 2010, leading to a
10m increase in net profit. Litigation
services at the firm did particlarly
well, with financial services litigation
and construction litigation growing
by 15 per cent and 23 per cent respec-
tively.
All of our key indicators are posi-
tive, with activity and billings ahead
of last year. Our strong revenue posi-
tion has flown down to the margins,
with a 10m increase in net profit
margin, said chief executive Bryan
Hughes.
Eversheds revenues up 7pc
Spread betting and CFDs carry a high level of risk to your capital
and you can lose more than your initial deposit. These trading
products may not be suitable for all investors so seek independent
advice if necessary.
Go to capitalspreads.com/freereport and download a copy
of our free report today and learn how successful traders stay
profitable and reduce risk.
Capital thinking #20
The ability to cut losses quickly
is the sign of a good trader.
We know what youre thinking yes we all
know that but when your trade is tumbling
more into the red, what do you do? You do
the opposite you run your losses and take
your prots too early.
Capital Spreads is a trading name of London Capital Group, which is
authorised and regulated by the Financial Services Authority and a member
of the London Stock Exchange. Registered Address: 2nd floor, 6 Devonshire
Square, London, EC2M 4AB. Registered Number: 3218125.
PRIVATE equity funds or trade buyers
are likely to snap up the medical arm
of scandal-hit Olympus, investors and
customers said yesterday.
Fund managers said the impor-
tance to hospitals of the lucrative
endoscope arm means it is the equiv-
alent of a bank which is too big to
fail and would be bought if it
becomes clear Olympus can no longer
run it.
There are many people who want
to buy its business, said a fund man-
ager at a firm whose clients have
stakes in Olympus, while a source at
an Asian hospital chain said the
groups good parts will be bought
by staff or a trade buyer.
Bidders are likely to emerge slowly,
however, because of several probes
that have further to run. Likely bid-
ders would include rivals Fujifilm
and Hoya, if they can overcome com-
petition hurdles, while cash-rich cam-
era-maker Canon could cherry pick
certain assets at a later stage.
The groups bankers, which
include Sumitomo Mitsui and
Mizuho, are due to meet Olympus
executives tomorrow.
Olympus break-up looms
BY PETER EDWARDS
TECHNOLOGY

SHAREHOLDERS in engineering
group Charter International accepted
the 1.5bn takeover offer from US
rival Colfax yesterday in two votes
showing majority support for the
cash and shares deal.
More than 91 per cent of sharehold-
ers equivalent to nearly 88 per cent of
all voting rights voted to accept a
910p per share offer from Colfax, in
polls at a court meeting and a general
meeting yesterday.
Colfax, which makes pumps and
valves, said the vote showed over-
whelming support for its takeover
offer, which concluded a turbulent
five months of horse-trading for
Charter as rival bidder Melrose tried
to convince investors to back its own
850p per share indicative bid.
All the resolutions proposed
received the overwhelming support
of Charter shareholders, it said.
But just under nine per cent of
shareholders holding 12 per cent of
voting rights opposed the takeover,
reflecting some ongoing concerns.
Long-term holders of Charter
shares had supported the 850p per
share offer from Melrose, a UK-based
turnaround investment group that
has revived the prospects of engineer-
ing firms such as Dynacast, which it
sold for $590m (367m) in June.
Shareholders such as Schroders
and Aviva Investors argued that
Melrose offered them the chance to
continue to hold a UK-listed stock
while sharing in the upside from
Charters ongoing success.
More than 75 per cent of all share-
holders voted in each of the two polls.
The takeover is now just waiting for
court approval to sanction Colfaxs
offer, with a hearing scheduled for 12
January next year. Colfax said it
expected to complete the deal on 13
January.
Colfax gets
yes vote to
buy Charter
ASSET manager Liontrust is on the
hunt for more acquisitions as it tries to
restore its fortunes by entering new
asset classes.
Chief executive John Ions told City
A.M. the firm has a 15m cash pile to
spend on deals as it looks to grow
organically and through buyouts.
Liontrust is trying to rebuild its busi-
ness after losing two key managers
and the bulk of its assets in 2009.
Yesterday it said net inflows for the
six months to the end of September
stood at 59m.
Clients have added 12m of new
money since 1 October, helping its
assets to reach 1.35bn by November
10, up 13 per cent from 30 September.
Ions said Liontrust would consider
making acquisitions where we see
opportunities in distribution skills or
fund management capability or
assets.
Earlier this year Liontrust bought
Occam Asset Management. Ions said in
a statement the deal provides the firm
with capability in Asia and emerging
markets, and added: We will be
launching new funds for the two
teams in 2012 to meet strong investor
demand for these asset classes.
Liontrust also reported a half-year
pre-tax profit of 1.7m for the six
months to the end of September due
to a one-off gain from selling its credit
business and rising performance fees.
Hungry Lion
roars back
into black
SABA Capital, the $4.7bn hedge fund
set up by ex-Deutsche Bank propri-
etary trader Boaz Weinstein is launch-
ing a new office in London as part of
its first expansion outside of the US.
Prakash Narayanan, former head of
leveraged finance trading at Deutsche
Bank, will run the UK office, which
will focus primarily on research in
European markets.
Weinstein, a chess master, rebound-
ed from a trading loss of around
$1.8bn at Deutsche Bank during the
financial crisis to found New-York-
based Saba in 2009, one of the fastest
growing hedge funds of the last year.
Sabas UK branch is still awaiting
Financial Services Authority registra-
tion, but is expected to be fully opera-
tion in the first quarter of next year.
Throgmorton has been appointed to
supply a range of back-office services.
Saba launches UK office
FINANCIAL SERVICES

Axed chief executive Michael Woodford could return to Olympus Picture: REUTERS
BY PETER EDWARDS
ASSET MANAGEMENT

BY ELIZABETH FOURNIER
LEGAL SERVICES

BY ALISON LOCK
INDUSTRY

ANALYSIS l Liontrust Asset Management


p
8Nov 9Nov 10Nov 11 Nov 14Nov
80
70
75
65
60
75.50
14 Nov
SHARES in Premier Foods tanked yes-
terday after its one of its Loyd
Grossman curry sauces was recalled
in a botulism scare and UBS down-
graded its shares to a sell.
The UKs largest food producer has
recalled tens of thousands of korma
jars as a precaution, but its shares fell
11 per cent to just 5.74p yesterday.
Premier shares
hit by food bug
CONSUMER

*Best Buy Source: Moneysupermarket 12 & 13 November 2011. first direct credit facilities are subject to status. Rates correct as at 29 October 2011. Because we want to make sure were doing a good job,
we may monitor and/or record our calls. HSBC Bank plc 2011. All Rights Reserved. first direct, 40 Wakefield Road, Leeds LS98 1FD.
A
C
2
3
2
6
4
Low rate
highly
rated
2 Year Tracker Offset
Mortgage Limited Edition
Tracks the Bank of England base rate plus
1.58% for 2 years, currently
2.08%
Changing to our Standard Variable Rate
for the rest of the term, currently
3.69%
The overall cost for comparison is
3.7%APR
Maximum loan to value (LTV) is 65%.
Minimum mortgage is 30,000.
An arrangement fee of 1,499 applies.
A low rate tracker
offset mortgage
A Best Buy* tracker from an award-winning provider?
It must be a mortgage from first direct. Our 2 Year Tracker
Offset Limited Edition Mortgage lets you track 1.58% above the
Bank of England base rate for 2 years and link your qualifying savings
and current accounts to your mortgage so you only pay interest on
the difference. That means that you could pay less interest on your
mortgage every month, and less on your mortgage overall.
All this from the bank named Which? Most Recommended Mortgage
Provider 2011. So if youre looking for a great new mortgage deal,
we recommend you call us today.
Other fees and charges may apply. You must
hold or open a 1st Account to qualify. This offer
may be withdrawn at any time without notice.
Think carefully before securing other debts against your home. Your home may be repossessed if you do not keep up repayments on your mortgage.
0800 151 3009
firstdirect.com
A range of mortgages, nicely arranged
B
e
s
t

B
u
y
Every Saver.
Every Penny.
'4.5% on your money, with

d
Z^
W&
/

^
&
Z^
NIGERIAS state-oil company NNPC
has said that two local firms have
completed the purchase of 45 per
cent stakes in two onshore oil
blocks, previously owned by Shell,
Total and Eni.
First Hydrocarbon Nigeria,
owned by FTSE 250-listed Afren,
bought a 45 per cent stake in the
OML 26 block owned jointly by
Shell, Total and Eni, NNPC said.
The block has target production
of 50,000 barrels of oil per day by
2015, the state-owned firm said. No
details on the purchase value of the
oil block was provided in NNPCs
statement.
NNPC said the foreign oil majors
sold 45 per cent of another block,
OML 42, to Neconde Energy.
Neconde at the bidding stages was a
consortium including Nigerian
firms Nestoil, Aries and VP Global
and Poland's Kulczk Oil Ventures.
These blocks are among several
put up for sale this year by Shell
Petroleum Development Company
30 per cent-owned by Shell and 55
per cent-owned by NNPC. Eni and
Total also own small stakes.
Shell has said that it still views
Nigeria as a key part of its business
and this is not the beginning of a
wider departure from Africas most
populous nation.
Shell sells off two
Nigerian oil blocks
BY HARRY BANKS
ENERGY

News
20 CITYA.M. 15 NOVEMBER 2011
CHINA DRIVES LIFT IN SALES AT JAGUAR LAND ROVER
THE TURNAROUND
at Jaguar Land
Rover looks set to
continue, as grow-
ing demand from
Chinas luxury mar-
ket drove a 30 per
cent year-on-year
sales rise at the UK
car manufacturer.
Jaguar Land Rover,
which announced
last week it was hir-
ing 1,000 workers at
its factory in
Solihull, said yester-
day revenues had
hit 2.9bn in the
three months to 30
September.
Picture: REUTERS
NEWS | IN BRIEF
Rolls-Royce gets Dubai orders
Rolls-Royce has announced a series of
contract wins from the Dubai airshow,
including a $280m (176.2m) order for
four Trent 700 engines to go into
Garuda Indonesia Airlines Airbus
A330 fleet. The engineering giant also
said the airline had confirmed a previ-
ous order for the Trent 700 engines to
power six other A300s. On top of the
Garuda order, Rolls-Royce has won a
contract from Oman Air for engines to
power six Boeing 787 Dreamliners, and
an order worth up to $500m from
Saudi Arabian Airlines to provide
engines and its proprietary TotalCare
support services for four Airbus
A330s. Nick Devall, Rolls-Royce com-
mercial chief for civil aerospace, said:
"Garuda Indonesia Airlines is a valued
customer and we are pleased that they
have again put their trust in our lead-
ing edge technology and support serv-
ices.
MORE NEWS
ONLINE AT
@
@
www.cityam.com
ANALYSIS l Royal Dutch Shell
p
8Nov 9Nov 10Nov 11 Nov 14Nov
2,220
2,200
2,180
2,160
2,140
2,222.00
14 Nov
7
th
November 5
th
December 2011
WIN SUPERCAR CLUB
MEMBERSHIP WORTH 10,000
JOIN OUR FANTASY TRADING CHALLENGE
Now anyone can try fixed-risk trading, without risking a single
penny for real. Build the ultimate virtual portfolio from our range of
Covered Warrants, Turbos and Super10s, and you could win an
annual membership to a supercar club worth 10,000, including
25 days of supercar hire. There is a host of educational materials,
to help and many more chances to win, so register today for free.
WWW.SGMARKETMASTER.CO.UK
For more information on Leveraged Products call 0800 328 1199 or
visit us online at www.sglistedproducts.co.uk
Covered Warrants, Super10s and Turbos are leveraged products and suitable for sophisticated retail investors. The underlying assets may be volatile and both gains and losses could be greater than
those incurred by the underlying asset itself. As the issuer, any failure by Societe Generale Acceptance N.V. to make payments due may result in the loss of all or part of your investment. This is a
marketing document issued in the UK by the London Branch of Societe Generale. Societe Generale is a French credit institution (bank) authorized by the Autorit de Contrle Prudentiel (the French
Prudential Control Authority). Societe Generale is subject to limited regulation by the Financial Services Authority in the UK. Details of the extent of our regulation by the Financial Services Authority
are available from us on request. Any reproduction, disclosure or dissemination of these materials is prohibited.
REGISTER FREE NOW AT
SGMARKETMASTER.CO.UK
BHP Billiton plans to spend around
$4.5bn (2.8bn) on developing shale
gas in 2012 following two acquisitions
this year, the head of the global
miners petroleum business said yes-
terday.
The miner spent nearly $17bn buy-
ing shale gas producer Petrohawk
Energy and shale gas assets from
Chesapeake Energy earlier this year.
It is targeting US shale production
of 545bn cubic feet equivalent 90m
barrels of oil equivalent in the 2012
financial year.
The shale gas projects are part of
BHPs plans to spend $80bn over five
years on expanding production
across its iron ore, coal, copper, urani-
um and petroleum businesses
This is going to be a game changer
around the world and for BHP Billiton
not to be part of it would be irrespon-
sible, BHP petroleum chief executive
Michael Yeager said.
BHP said it plans to spend around
$5.5bn a year by 2015, about a billion
more than previous estimates, and
around $6.5bn a year in 2020 on US
shale, despite some landowners
claiming the mining technology rais-
es safety concerns.
BHPs move this year into the rela-
tively new and contentious energy
source has worried some investors,
particularly with US gas prices
depressed by the growing supply of
gas from shale. Chief executive
Marius Kloppers, however, has played
down the concern, saying the group
takes a multi-decade view on price.
BHP Billiton to
spend $4.5bn
on shale gas
LONMIN beat expectations with a 59
per cent jump in full-year earnings,
even though a strike at its Karee oper-
ations drove up unit costs and forced
the miner to cut its output target.
The worlds third biggest platinum
producer said demand next year
would be softer than had been fore-
cast, prompting it to change previous
forecasts of a supply deficit for 2012
to a balanced or moderately oversup-
plied platinum market.
It also said it expected volatility in
precious metals markets in the short
term.
Platinum is one of the commodi-
ties most geared to the Eurozone,
with Europe consuming roughly a
quarter of the metal for catalysts for
vehicles, used to cut pollution from
car exhausts.
But chief executive Ian Farmer said
that China was taking up much of the
slack from a weaker Europe:
Jewellery is price sensitive, so as
price comes down or the price rela-
tive to gold looks more attractive, we
see volumes pick up.
Farmer said he expected prices to
recover towards the end of 2012,
2013. Platinum prices have dipped in
the 2011 calendar year, with spot
prices down around six per cent since
January.
Lonmin beats
forecasts but
warns on 2012
BY JOHN DUNNE
MINING

MINING

News
21 CITYA.M. 15 NOVEMBER 2011
RUSSIAN aluminium giant Rusal said
yesterday its profits had risen in the
third quarter triggered in part by
massive cost cutting, including the
freezing of bonuses for top execu-
tives.
The company, which listed on the
Hong Kong stock exchange in January
last year, said profits reached $432m
(271m) despite a fall in aluminium
prices.
In the same period last year Rusal
recorded profits of $29m, before it set
in motion its plan to slash costs.
Deputy chief executive Oleg
Mukhamedshin told City A.M. that rel-
atively strong growth in China and
rebuilding in quake-hit Japan was
helping his business, centred in
Siberia.
We are well placed to supply our
biggest market in China. Demand is
still strong. We have cut costs, partic-
ularly in administration, and are pay-
ing off debt. He said executives,
including himself, had seen bonuses
frozen in the third quarter and that
future payouts were under review.
The company has renegotiated its
debt facilities and is now able to pay
out dividends but has chosen not to,
in a move to further shore up its
financial position, he said.
BY JOHN DUNNE
MINING

Rusal profits rise as cost


cutting measures kick in
Rusals deputy chief exec Oleg Mukhamedshin said the firm is on track Picture: REUTERS
ANALYSIS l BHP Billiton PLC

8Nov 9Nov 10Nov 11 Nov 14Nov


2,050
2,025
2,000
1,975
1,950
1,925
1,900
1,970.50
14 Nov
UK BANKS are on track to meet their
lending targets set by Project Merlin,
the Bank of England confirmed yes-
terday, but critics attacked the figures
as meaningless, with some business
groups calling for more credit to stim-
ulate growth.
Barclays, HSBC, Lloyds, RBS and
Santander made 57.4bn available to
businesses in the UK in the third
quarter of the year, the Bank revealed,
bringing the total to 157.7bn for the
year to September.
The leading banks must hit 190bn
for 2011 as a whole, with 76bn allo-
cated to small and medium sized
enterprises (SMEs).
In quarters one to three, 56.1bn
was made available to SMEs, yet
Michael Saunders of Citigroup said
the figure did not equate to a gen-
uine overall improvement in the
availability and cost of credit for
small firms.
We suspect that, in aggregate,
banks are meeting their Project
Merlin targets by making credit avail-
able at a high price and on tough
terms that few firms can afford to
meet, Saunders said.
The Bank has reported that net
bank lending to non-financial compa-
nies fell by 3.4 per cent annualised in
August, while lending to SMEs fell by
5.1 per cent year on year.
These targets are politically driven
and dont address the lack of competi-
tion in the sector, as the main five
banks control around 85 per cent of
the small business banking market,
argued John Walker of the Federation
of Small Businesses (FSB).
Our members are telling us they
are still finding it difficult to access
finance, added Brian Berry from the
Federation of Master Builders (FMB).
A recent FMB survey showed that
57 per cent of its members reported
that their bank had made some
form of adverse change to their lend-
ing policy towards the firm, either by
withdrawing credit facilities or by
increasing the cost of them.
Merlin target
hit yet banks
face criticism
BY JULIAN HARRIS
BANKING

News
22 CITYA.M. 15 NOVEMBER 2011
THE GOVERNMENT took 66p of every
pound spent at the petrol pumps in
the financial year 2009-10, the Office
for National Statistics said yesterday.
The figure was up from 62p in the
pound in 2008-09, partly due to higher
taxes, including VAT.
Yet rising fuel prices mean that the
proportion of petrol costs taken by the
government is lower than earlier in
the decade. In 2001-02, UK authorities
grabbed 81p from every pound spent
on petrol and diesel.
The price of a litre of unleaded
petrol dropped to less than 86p in
January 2009, says Experian, but aver-
aged closer to 134p a litre last week.
Current fuel prices are crippling
family budgets, especially those on
low incomes, an RAC spokesperson
said. Something needs to be done to
control these spiralling prices which
is why todays Commons debate on
fuel prices is so important. The Forum
of Private Business is urging the coali-
tion to shelve fuel duty rises.
The average household spent 677
on fuel duties in 2009-10. The ONS
added: In 2009-10 the richest 20 per
cent of households spent 1,062 on
petrol taxes, compared with 365 for
the poorest 20 per cent of households.
THE FORUM: P29
BY JULIAN HARRIS
ENERGY

Taxman now takes 66p


per pound at the pumps
A litre of unleaded petrol now costs around 134p on average
NEWS | IN BRIEF
TUC attacks funds on salaries
Remuneration is the topic most likely to
stir up disagreement between company
management and institutional investors,
according to a study released today by
the Trades Union Congress (TUC) today.
However, the report also found bank
remuneration was particularly strongly
supported. Barclays led the field with 75
per cent of fund managers backing its
remuneration. The TUC believes this
shows fund managers are failing to max-
imise the return on their investments.
Shareholders are supposed to be the
ultimate check on our corporate system,
but too many fund managers are still
failing to use the power of their invest-
ments to influence corporate behaviour,
said general secretary Brendan Barber.
The fact that bank remuneration
reports received so much backing in the
face of diminishing dividends and poor
stock market performance is a clear sign
institutional investors are not doing their
job properly.
OECD says global growth slowing
Countries that have been growing
strongly, including Japan, Russia and the
US, are set to slow down towards their
long-term trend rate, according to a
report out yesterday from the
Organisation for Economic Co-operation
and Development (OECD). Meanwhile,
economies like the UK, Brazil, China and
the Eurozone are expected to fall below
their long-term trend growth rates. The
Eurozones score fell from 99.9 in August
to 99.1 in September. The UK fell from
99.8 to 99.0, while the US slowed from
101.5 to 101.2. China, India, Indonesia,
Japan and South Korea together
declined from 99.3 to 99.0. A score of
100 represents the long-term trend rate.
News
23 CITYA.M. 15 NOVEMBER 2011
Bespoke Stationery
For a personal consultation or to place an order,
please call or email us on:
1 Curzon Street, Mayfair, London, W1J 5HD
T: 020 7351 5887
E: info@wrenpress.com
www.wrenpress.com
The Wren Press collection of Christmas stationery is one of true
craftsmanship and style. Every product is designed, developed and hand-crafted
by our team of highly skilled individuals, making each piece truly exceptional.
THE ECONOMY can grow healthily
alongside cuts in the governments
annual deficit, the liberal think-tank
Centre Forum will argue today.
Using the 1930s as a previous
example, the group says that low
real interest rates and an absence
of strict planning laws led to a
housing boom that helped stimu-
late recovery from the Great
Depression.
Housing market liber-
alisation and cheap
money would help
this time around too,
it claims. If the econ-
omy does not
rebound soon, policy
makers will need to
consider options
such as this if
Britain is going to
avoid an extended,
double-dip recession,
writes Professor
Nicholas Crafts, author
of the study.
Mervyn King (pictured) and the
Bank of England should temporarily
double the target level for inflation,
he argues: This would have to be clear
and credible so that the inflation was
fully anticipated by the public
and it would work by reducing
the real interest rate.
From 1932 to 1934 the British
government reduced its struc-
tural budget deficit by nearly
two per cent of GDP, the
report states. Yet, from
1933 to 1937 there
was strong growth
such that real GDP
increased by nearly
20 per cent over
that period,
Crafts says.
A more liber-
al planning
envi ronment
saw the private sec-
tor build 293,000
houses in just the
year to March 1935,
the research states.
Help todays recovery with
1930s-style housing boom
BY JULIAN HARRIS
UK ECONOMY

A BOOM in Japans economy from


July to September has taken GDP to
levels higher than those seen before
the earthquake and tsunami in
March.
However, many economists believe
the growth spurt was largely a
rebound from Marchs disaster.
The economy expanded by 1.5 per
cent in the third quarter, according
to official figures.
Domestic demand rose by one per
cent, while rapid repairs to supply
chains allowed a 6.3 per cent
rebound in exports in the third quar-
ter as exports exceeded imports,
reversing the position in the second
quarter.
Such a strong third quarter fol-
lowed a 0.5 per cent contraction in
the previous three months, and rep-
resents the first growth in a year.
Stripping away the catch up and
temporary elements of the third
quarter data casts doubt on the sus-
tainability of growth into 2012, said
Michael Taylor, an economist at
Lombard Street Research.
We expect recession early in 2012
in the US and the Eurozone, and the
economy in China, Japans biggest
trading partner, will be slowing too.
Industrial output and exports will
struggle to make further headway
against a very weak global back-
drop.
Japanese growth
spurt set to subside
NEWS | IN BRIEF
Umunna: Rewards for workers
Workers need a greater stake in busi-
nesses, and firms need to consider their
communities more, Labours new shadow
business secretary Chuka Umunna said
yesterday. Productive, competitive firms
who invest in staff development are good
for society as a whole, he said. If mar-
kets are generating greater wealth and
distributing it efficiently, fewer people
will have to rely on the state.
Eastern Europe surviving slump
The economic outlook for central and
eastern Europe, the middle east and
Africa (CEEMEA) has been downgraded
as a result of the Eurozone crisis, UBS
said yesterday. However, the countries
are performing better than their richer
counterparts. Fundamentals within the
regions corporates remain healthy, the
report said. UBS does warn of increased
volatility as a result of the ongoing crisis.
@
@
@
MORE NEWS
ONLINE
www.cityam.com
Japanese manufacturers have helped the country boost exports again Picture: REUTERS
BY TIM WALLACE
JAPANESE ECONOMY

HTC Sensation XL with Beats Audio


TM

and Beats
TM
by Dr. Dre urBeats
TM
in-ear headphones. Plus with a 4.7 inch
screen its the biggest multi-media
experience youll nd on a smartphone.
Designed to blow your mind.
Feel every
single beat.
INTERSERVE said yesterday it had won
support contracts worth a potential
420m from the Ministry of Defence,
bringing its total contract wins since
June to more than 600m.
The construction and outsourcing
firm said it would provide mechanical,
electrical and building services to the
Falklands, Ascension Island, Cyprus
and Gibraltar for at least five years.
In a statement Interserve main-
tained its guidance for 2011 and said
the contracts it had won since June
gave it a future workload of 5.3bn.
The order book encouragingly
remains stable against a challenging
market backdrop, said Brewin
Dolphin analysts Michael Parkinson
and James Woodrow.
Chief executive Adrian Ringrose
said the increasing need for Britains
public sector to outsource services was
likely to drive growth but said this
market was taking time to develop.
There is a lot of talk in the market
that this sector is about to take off
immediately, which we do not particu-
larly subscribe to but I do not think it
is right to write the sector off either
it has got potential, he said.
Asked whether Interserve was inter-
ested in bidding again for troubled
British peer Mouchel Group, Ringrose
said he would never rule out mergers
and acquisitions but added there was
nothing to rule them in either.
Interserve bid for Mouchel earlier
this year in a deal which valued the cri-
sis-hit firms stock at 135p, but talks
broke down over a valuation.
The company is expected to post
full-year pre-tax profit of 69.5m,
according to a Reuters poll of 14 ana-
lysts.
Interserve to
get lift from
UK contracts
ROBERT Wiseman Dairies has posted
a 42 per cent fall in pre-tax profit for
the first half as it continued to be hit
by input price inflation, and said a
tough economy was making it more
difficult to recover these increased
costs.
The Scottish dairy group, which
has grown from a humble beginning
in Robert Wiseman Seniors family
farm in East Kilbride, said it was hurt
by three increases in the amount
paid for raw milk since March 2011
and by rises in other costs.
The company supplies nearly a
third of fresh milk consumed in
Britain daily, according to its web-
site.
We will remain focused on reduc-
ing costs to protect our margins for
the remainder of the year, Robert
Wiseman said in a statement yester-
day.
Inflation in Britain hit a three-year
high in September, driven by soaring
gas and electricity bills, adding to the
severe squeeze on Britons living
standards.
For the six months ended 1
October, the companys pre-tax profit
was 11.8m, compared with 20.2m
last year. Turnover increased one per
cent to 457.7m.
At my bank everyone
can get a bonus.
At the end of 2010, The Co-operative Group shared over 70.5m in prots
with its members. And you can also bank with us in 245 branches of
Change to a bank you can bank on by calling 0800 169 9369.
As a member you are required to hold and retain one share in The Co-operative Group, this will be paid for through the deduction of 1 from your first share of the profits
payment. To qualify for a share of the profits payment members must have earned a minimum of 2 worth of membership points, within the qualifying period. Membership
terms and conditions apply. Products not eligible to earn points are affinity and partnership products, offshore, fixed rate and fixed term savings accounts and bonds. Lines
are open from 8am until 9pm, Monday to Friday and 9am until 6pm, Saturday and Sunday. Calls may be monitored or recorded for security and training purposes. For BT
customers, calls to 0800 numbers are free. Call charges from other providers may vary. Current account applicants must be a UK resident and 18 years or over. Credit facilities
provided by The Co-operative Bank are subject to status and our lending policy. The Co-operative Bank is authorised and regulated by the Financial Services Authority
(No. 121885), subscribes to the Lending Code and the Financial Ombudsman Service and is licensed by the Office of Fair Trading (No. 006110). The Co-operative Bank p.l.c.,
P.O. Box 101, 1 Balloon Street, Manchester M60 4EP. Registered in England and Wales No. 990937. Britannia is a trading name used by The Co-operative Bank p.l.c.
Robert Wiseman Dairies hit
as rise in inflation continues
BY HARRY BANKS
SUPPORT SERVICES

Interserve chief exec Adrian Ringrose said public sector contracts had potential
BY HARRY BANKS
FOOD & BEVERAGE

News
25 CITYA.M. 15 NOVEMBER 2011
NEWS | IN BRIEF
Cranswick suffers as costs rise
British pork supplier Cranswick posted a
22 per cent fall in first-half profit, hurt
by higher input costs, and said it was
cautiously optimistic about the second
half. The company faced significant
increases in input costs during the first
three months of the period. This had a
material impact on margins and, despite
some recovery during the second quar-
ter, was a key factor in a reduction in
interim pre-tax profits, chairman,
Martin Davey said in a statement yester-
day. April-September pre-tax profit was
18.5m, compared with 23.8m last
year. Revenue, however, rose three per
cent at 393.9m helped by higher vol-
umes.
Dignity expansion boosts profits
Dignitys underlying operating profit rose
for the nine months ended on 30
September, helped by an increase in the
number of funeral and crematoria loca-
tions, and maintained a positive outlook
for the rest of the year. The company
said pre-arranged funeral plan sales
were strong and that trading since 30
September was in line with expecta-
tions. With the full-year expectations for
the year remaining unchanged, Dignity,
the UK's only listed funeral services
provider, added three funeral and seven
satellite locations since 27 July. January-
September underlying operating profit
was 48.4m, compared with 45m last
year. Sales for the period rose 7.3 per
cent to 155.8m.
Vectura recovers from losses
Specialist drug company Vectura has
reported a move into profit for the first
half of the year, posting revenues ahead
of expectations at 21.1m, and profits
after tax of 2.6m a 2.8m improve-
ment on the loss a year earlier.
ANALYSIS l Interserve PLC
p
8Nov 9Nov 10Nov 11 Nov 14Nov
327.50
325.00
322.50
320.00
317.50
321.20
14 Nov
See which pairs our traders are watching live
Follow professional FX traders and emulate their trades, whilst simultaneously being
educated on how to trade the FX markets.
Our team will navigate you through the Intricacies of the FX world helping you better
understand the pitfalls of trading FX pairs.
Streaming live trade data displays TMC's traders' latest trades and insights together with
real-time market information; trading chart analyses display up-to-the-minute trading
charts; and our live question feature allows users to ask the traders any related questions
that may arise during the days trades.
For more information about the Trader Management Company and how you might
incorporate TMC's service into your own trading, visit TraderManagement.com.
Don't lose your shirt
trading the wrong pair
Real thinking - Real trading
Forex trading carries a high level of risk & is not suitable for all investors. The leverage associated with Forex trading can result in losses
which may exceed your initial investment. Consider your objectives & level of experience carefully before trading & if necessary seek advice
from a financial advisor. The Trader Management Company Ltd. is authorised and regulated in the United Kingdom by the Financial
Services Authority under FSA Registration Number 525164. TMC is compensated through subscriptions to its live trading room service.
Does your company offer Forex to retail clients?
Through the delivery of real-time education and trades, TMC's
live trading room can act as an unparalleled reactivation tool
for dormant clients. To learn how your organisation could
receive free client access to TMC's complete trading room
service, email support@tradermanagement.com today.
www.TraderManagement.com
Halma
The safety, health and sensor technology
group has appointed Daniela Barone
Soares as a non-executive director.
Barone Soares is chief executive of
Impetus Trust, the venture philanthro-
pist that translates venture capital prin-
ciples to the social sector.
Orascom Telecom
The executive chairman of Orascom
Telecom, Khaled Bichara, will step
down at the end of the year. It is
unclear whether Bichara will also step
down as chief operating officer of
VimpelCom, which bought Orascoms
parent company in April.
Macquarie Capital
The financial services group has appoint-
ed Allen Bertie, formerly managing
director and chief executive of the
European operation of GCA Savvian, as
senior managing director in the newly
created industrials, communications and
sponsors team. The firm has also hired
Raj Khatri as senior managing director
and head of metals and mining coverage
in Europe. He joins from RBS, where he
was managing director and head of met-
als and mining EMEA.
DLA Piper
The law firm has launched its interna-
tional securities group, to be led by
London-based US securities partner
George Barboutis. Prior to joining DLA
Piper, Barboutis was a partner with
Dewey & Leboeuf, based in London.
Vanguard Asset Management
Neil Cowell has been appointed as head
of retail sales at the asset manager to
lead the retail team responsible for
developing Vanguards relationships
with both fee-based advisers and
wealth managers. Cowell previously
worked for Standard Life, where he held
various distribution roles.
JP Morgan Asset Management
Monique Stephens has been appointed
as a client adviser in the institutional
team. She was previously institutional
sales manager at Invesco Perpetual.
Grant Thornton
Patrick OMahony has joined as a
partner in the financial advisers
Gatwick office to lead its tax team. He
joins from RSM Tenon, where he was
head of tax for the north west.
CITY MOVES | WHOS SWITCHING JOBS Edited by Harriet Dennys
+44 (0)20 7092 0053
morganmckinley.com
To appear in CITYMOVES please email your career
updates and pictures to citymoves@cityam.com SPECIALISTS IN GLOBAL PROFESSIONAL RECRUITMENT
in association with
US stocks dented
by Europe worries
U
S stocks fell yesterday as rising
bond yields in Italy and other
Eurozone countries reminded
investors that despite changes
in governments, the regions debt cri-
sis could still spin out of control.
Banks posted the largest losses, but
overall volume was unusually weak.
The KBW bank index dropped 2.5 per
cent, with Bank of New York Mellon
down more than four per cent.
The S&P 500 found strong resist-
ance after closing on Friday near its
200-day moving average and close to
the top of a trading range the index
has held for three months.
Initial relief over the appointment
of a technocrat to head the new gov-
ernment in Italy after the resignation
of Silvio Berlusconi gave way to wor-
ries that unpopular austerity meas-
ures will not be enough to fix the
countrys finances.
Benchmark yields in Italy, France
and Spain edged higher from the end
of last week and closed near session
highs. Rising bond yields are being
watched carefully because every rise
in interest rates threatens the ability
of Italy and other countries to finance
themselves.
That sign of a reversal of what had
been a more favorable trend in
Europe is what the [equities] market
worried about today, said Jeff
Kleintop, chief market strategist at
LPL Financial in Boston.
That has raised worries that
European problems are not that
much behind us.
Stocks have lately focused on head-
lines from Europe as traders react to
the escalating sovereign debt crisis in
the Eurozone. Italian benchmark
bond yields rose above seven per cent
last week, a level that forced coun-
tries with a lower debt burden to seek
bailouts. With debt of more than 2
trillion, Italy is considered too big to
bail out.
Yields on 10-year Italian debt rose
to 6.76 per cent yesterday.
The Dow Jones industrial average
dropped 74.70 points, or 0.61 per cent,
at 12,078.98. The Standard & Poors
500 Index fell 12.07 points, or 0.96 per
cent, at 1,251.78. The Nasdaq
Composite Index lost 21.53 points, or
0.80 per cent, at 2,657.22.
Around 5.5bn shares traded on the
New York Stock Exchange, NYSE
Amex and Nasdaq, the third-lowest
number so far this year and down
more than 30 per cent from the years
daily average of just over 8bn.
Declining stocks outnumbered
advancing ones on the NYSE by a
ratio of 16 to 5. On the Nasdaq, about
three stocks fell for every one rising.
B
RITAINS top shares fell yester-
day as the latest Italian bond
auction dented investor confi-
dence in the ability of new gov-
ernments in Italy and Greece to tackle
Europes debt crisis.
An Italian five-year government
bond auction delivered an early mar-
ket view on former European
Commissioner Mario Montis leader-
ship after he was installed as Prime
Minister of Italy on Sunday in the
wake of Silvio Berlusconis resignation.
While the auction was well covered,
the record yield of 6.29 per cent cast
doubt on the long-term financing of
the country.
German Chancellor Angela Merkel
said that Europe could be living
through its toughest hour since World
War Two as new leaders in Italy and
Greece rushed to form governments
and limit the damage from the Euro
zone debt crisis.
Short-term, I suppose [the change
in political leadership] is good in terms
of sentiment, but not enough to calm
market nerves, said Henk Potts, mar-
ket strategist at Barclays Wealth.
There are still fundamental ques-
tions that need to be resolved, includ-
ing how to stimulate growth within
the Eurozone, and I suppose that the
roadmap is towards fiscal union,
which you have to believe is the final
destination.
Supporting expectations of a sharp
contraction of output and a probable
economic recession, industrial produc-
tion in the Eurozone posted its bigged
monthly fall since February 2009.
The UK benchmark closed 26.34
points, or 0.5 per cent, lower at
5,519.04, led down by banks and min-
ers as investors dumped riskier assets.
Trading volumes sagged, with the
FTSE 100 at only 71 per cent of its 90-
day daily average.
Theres not an awful lot thats real-
ly providing stimulus for people to
actually start trading again. They want
to see austerity packages put into prac-
tice rather than talked about, said
Martin Dobson, head of trading at
Westhouse Securities.
Barclays shed 2.7 per cent as
Goldman Sachs cut its rating on the
stock to sell from neutral on expec-
tations would de dealt the biggest
blow by reforms from the
Independent Commission on Banking.
Goldman said that while the ICB
estimated the annual pre-tax costs of
reform for UK banks at 4-7bn, it reck-
oned all-in costs at 10bn.
ITV topped the leader board, up 3.3
per cent after Britains biggest free-to-
air commercial broadcaster said it
expects to outperform the wider televi-
sion advertising market in 2011 after a
better than expected third quarter
trading update.
Luxury goods group Burberry,
ahead of first-half results today, took
second place on the risers list, up 3.2
per cent.
And a broker upgrade helped lift
medical products company Smith &
Nephew by 2.6 per cent. Exane BNP
Paribas switched its rating on the
stock to outperform from neutral.
The stock has underperformed by 20
per cent in the year-to-date.
Meanwhile European shares also
fell dented by Italy paying euro-era
high price to sell itsfive-year bonds.
Italian banks, exposed to the coun-
trys sovereign debt, were among the
biggest fallers, having been strong
gainers on Friday in anticipation of
Silvio Berlusconis exit as Prime
Minister.
Intesa SanPaolo and UniCredit fell
4.1 and 6.2 per cent respectively.
Investors were also absorbing
UniCredits third-quarter loss and
plans for a 7.5bn capital increase.
FTSE falls as Italys bond sale
reduces investor confidence
THELONDON
REPORT
THENEW YORK
REPORT
BEST OF THE BROKERS
To appear in Best of the Brokers email your research to notes@cityam.com
ANALYSIS l Synergy Health
860
920
900
880
840
820
800
Sep Oct Nov
p 849.50
14 Nov
SYNERGY HEALTHCARE
Morgan Stanley rates the provider of sterilisation services to hospitals as
overweight with a target price of 1,085p, based on stable, defensive
growth, opportunities from new regions and acquisitions, a cheap valuation,
and expanding margins. Following eight per cent organic growth in its first
half results last week, the broker says the risk of cuts hitting hospital budgets
as a positive tailwind to growth as clients look for lower, outsourced costs.
ANALYSIS l Cairn Energy
320
300
280
260
Sep Oct Nov
p
290.40
14 Nov
CAIRN ENERGY
RBS rates the Edinburgh-based oil and gas exploration and production com-
pany as a hold with a target price of 315p, saying that once the long-await-
ed disposal of the companys stake in Cairn India should deliver a windfall for
its shareholders. The broker is hopeful of a resolution before the end of the
year, depending on government approval. It also says any deals that deliver
firm drilling plans in 2012 could result in a positive share price reaction.
ANALYSIS l Kingfisher
270
260
250
240
230
220
Sep Oct Nov
p
252.80
14 Nov
KINGFISHER
Nomura rates the retailer as a buy with a target price of 320p, following
a meeting with the groups general manager in Shanghai, at which the bro-
ker was reassured that the company is on track to meet its $1.6bn (1bn),
16 per cent direct sourcing target for the current year. The broker also sees
opportunity in harmonising the companys 10 brands to create better brand
recognition, which is currently fairly limited.
5Sep 15Aug 23Sep 13Oct 2Nov
5,800
5,000
5,400
5,200
5,600
ANALYSIS l FTSE
5,519.04
14 Nov
BTG
The specialist healthcare company has
appointed Garry Watts to succeed Dr John
Brown as non-executive chairman, effective
from 1 January 2012. Watts is chairman of the
Spire Healthcare group of private hospitals, a
senior independent director at Stagecoach
Group and a non-executive director of Coca-
Cola Enterprises. He was chief executive of
SSL International for seven years until its sale
in November 2010 to Reckitt Benckiser and an
executive director of Medeva and Celltech.
News
27 CITYA.M. 15 NOVEMBER 2011
C
AN India emerge as an innovation pow-
erhouse? Over the past two decades,
India has achieved a dominant share of
offshore work, giving Western popula-
tions angst about the loss of white collar jobs.
The traditional concern in the West has been
about immigrants coming onshore to com-
pete for local jobs; now it seems that the
effects of that competition can be felt from
distant offshore locations. But many Western
elites have argued that this fear should have
its limits, that outsourcing can only go so
far because the distinctive advantage of the
developed world remains innovation. For
example, Tom Friedman in The World is
Flat argues that innovation will continue
to keep the West economically supreme,
with the more sophisticated tasks being
done in the developed world and the less
sophisticated tasks in the developing
world where each has its comparative
advantage.
I and my colleague Phanish
Puranam spent three years research-
ing whether India could transition
from being the favored destination
for offshored services to a locus of
innovation. We discovered that
despite substantial innovation taking
place in India, much of it has been
invisible. While a company like Intel
ensures consumers know they are
using a personal computer powered by
Intel innovation, there often isnt any
such label on products when the innova-
tion originates in India.
Can India be a platform for generating
innovation for the global markets?:
Google, GE, Intel, Microsoft have already
answered in the affirmative. These compa-
nies have joined about 750 multinationals
seeking to develop business-to-business prod-
ucts for global markets in their Indian
research and development (R&D) centres just
as they do in their R&D centres in the West.
Perhaps the most invisible of Indian inno-
vations is the global service delivery model. It
is not a product innovation, but rather a
management innovation, a new way of man-
aging globally distributed work. It reconcep-
tualises formerly physically collocated
activities by breaking them up into subtasks
that can be done in different geographical
locations, and it specifies the necessary
means for integrating this work back again.
Whether a piece of work can be executed
remotely does not critically depend on how
simple and standardised it is. Instead, the
possibility of remote delivery depends on
whether its linkages to other pieces of work
are standardised.
If one takes a step back and thinks about
the invisible innovation in India, it has some
disquieting effects for jobs in the West. As
more work moves to China and India, compa-
nies in the West are likely to confront what
we call the sinking skill ladder problem.
What is a skill ladder? The idea that to do
highly sophisticated innovative work, you
need to have done less sophisticated work at
some stage in your career. Imagine being the
partner at a consulting firm without having
been an associate, an investment banker
without having been an analyst or the head
of a clinical research team without having
done any bench-work.
The work that the juniors do in each of
these cases may be fully separable from the
work that the seniors do; indeed the junior
could be somebody sitting in India. However,
in each of these cases, the seniors will contin-
ue to have a deep understanding of what
exactly the juniors do because they have been
juniors themselves at an earlier stage of their
careers. Without such knowledge, arguably
the seniors could not do their own jobs effec-
tively.
A problem lies ahead: Western companies
are blocking their talent pipelines. Without
that route, how will tomorrows senior lead-
ers emerge? Unless they have grappled with
this question, it seems facile to say that com-
panies in the West can move up into higher-
value-added services and leave the low end
work to their counterparts in Asia.
In some sense, the problem for managers
of companies from the developed world is
less complicated: they can move the next
rung of their R&D, and even their headquar-
ters, to where it can be done more effectively
and efficiently. However, disconcerting ques-
tions for policy makers in developed coun-
tries will remain.
Nirmalya Kumar and Phanish Puranam are co-
authors of India Inside, published this week by
Harvard Business Review Press. Nirmalya Kumar is
a professor of marketing and Phanish Puranam is a
professor of strategy at London Business School. They
are also co-directors of the Aditya Birla India Centre
at the school.
28
The Forum
CITYA.M. 15 NOVEMBER 2011
Perhaps the most invisible
of Indian innovations is the
global service delivery model
Indias innovation culture is
revealing itself at last and
the West faces a dilemma
cityam.com/forum
NIRMALYA KUMAR
Agree? Disagree? Got a sharp comment?
The Forum wants you to join the debate.
COMMENT NOW ON
Twitter: @cityamforum;
on the web: cityam.com/forum;
or by email: theforum@cityam.com.
Top responses will be reprinted in The Forum.
29
Fuel prices are as
high as they were
in the Suez crisis:
Bring them down
Setting a match
to the debate on
petrol inflation
I
NFLATION is now rising faster than
wages, and Britain faces a cost-of-living
crisis. Astronomical fuel prices are the
number one issue in my constituency:
they are creating a poverty trap, and are a
major brake on economic growth.
In real terms, adjusted for inflation,
motoring fuel has never been this expen-
sive except for just twice in history, dur-
ing historic crises of supply, the Suez crisis
and the Opec oil cartels blockade.
Ultimately, the problem is tax. Rip-off
fuel taxes are crushing our economy, mak-
ing our businesses uncompetitive, and
hurting families and the unemployed as
well. Right now, 66 per cent of the price at
the petrol pump is taxation.
Even Greece and Spain, with all their
debts, now have lower rates of fuel tax than
Britain. How can this be right?
Inevitably, the recession hit sales of
petrol and diesel in 2008. But even now
that the British economy is growing albeit
slowly sales continue to fall.
Since 1970, Britains consumption of
petrol and diesel has risen to approximate-
ly 35m litres a year. But 2008 was the high-
water mark. Since then, our consumption
has fallen year-on-year, and the Department
of Energy and Climate Change forecasts
that it will continue to plummet next year.
Petrol is now so astronomically expensive
that it is driving people off the road, and
costing the exchequer money.
The governments own figures show that
between January and June this year, 1.7bn
fewer litres of petrol and diesel were sold
(compared to the first half of 2008). The AA
believes that this equates to 1bn pounds in
lost revenue for the Treasury.
This is disastrous: the governments plan
to balance the books depends on raising an
extra 5bn from fuel duty revenues a year
by the end of this parliament.
With fuel sales down last year; down this
year; and estimated to be down next year,
where will that extra 5bn in revenues
come from?
The only way of squaring this circle is to
scrap the planned increases in fuel duty for
2012, and to keep taxes as low as possible,
to boost demand.
As the chancellor said earlier this year,
we must put fuel into the tank of the
British economy: we must flatten any-
thing that gets in the way of growth.
To his credit, George Osborne did cut fuel
duty by 1p at the budget this year, and
delayed the inflationary tax rises. But we
have to go further, for the sake of the ordi-
nary businesses and citizens it affects.
That is why today I will move a formal
motion in Parliament, triggering a debate
on cheaper petrol. So far, 107 MPs from
across the House of Commons have signed
my motion, and over 110,000 members of
the public have signed an e-petition sup-
porting the FairFuelUK campaign. It is vital
that the government treats this as a priori-
ty, and acts now to keep petrol prices low.
Robert Halfon is MP for Harlow. He is cam-
paigning with FairFuelUK for lower fuel taxes.
www.fairfueluk.com.
Bullion for bears
James Conways Italian sugges-
tion [Italian gold may be just the
job to save the day, last Friday] is
too complicated. Italy wont sell its
gold. But Italys gold reserves are
worth 103bn. Bond issues with
25 per cent to 50 per cent gold
collateral would be a confidence
booster. The Eurozone holds gold
worth 453bn. A portion could be
collateral for European Financial
Stability Facility bonds.
Neil Behrmann,
author
Unhappy campers
The Occupation of the Stock
Exchange are ordinary people
agitated and troubled by the
cares of the day who respect
Andrew Haldane, executive
director of the Bank of England
for financial stability, for recent-
ly pointing out the perverse
incentives caused by limited lia-
bility (of finance houses), exces-
sive gearing (borrowing), tax
relief for debt (borrowing), and
government insurance.
Effectively, the socialisation to
the taxpayer of losses based on
excessive and arbitrary borrow-
ing now means the retreat of the
state in areas of welfare, educa-
tion, sporting and social ameni-
ties, and healthcare. In my
opinion, the announced cuts in
public finances by the coalition
will cause carnage to the state
provision of education, social
and health care leading to a
threat to social harmony.
Liam T Kirk,
floating press officer, OLSX
RAPID RESPONSES
ROBERT HALFON
CITYA.M. 15 NOVEMBER 2011
The Forum
I
AM NOT a sup-
porter of quantita-
tive easing (QE),
but it strikes me
that there is a perverse
irony in the way it is
debated.
Lets recap the way it
is supposed to work. The Bank of England (BoE)
attempts to control economic activity through
interest rates a cut in interest rates makes spend-
ing more attractive than savings and can increase
aggregate demand.
But the nominal rate cannot fall below zero.
When standard monetary policy hits the zero lower
bound central banks can switch from focusing on
the price of credit (the interest rate) to the quanti-
ty. Since the current rate is 0.5 per cent there is lit-
tle scope for further cuts, and this is what the Bank
has done, with substantial injections of new money
in the guise of quantitative easing (QE). Since
growth in the money supply is a critical determi-
nant of the general price level, a substantial injec-
tion of money will raise inflation expectations.
After all, central banks can use their influence on
inflation to hit whatever level of aggregate demand
they wish.
But although the BoE has begun using QE as a
monetary policy tool, it is attempting to do so with-
in the existing regime of inflation targeting.
Inflation targeting goes beyond simply trying to
target low inflation. Any central bank can target
low inflation. Rather, inflation targeting also
involves a focus on transparency and accountability
on providing information to help the public form
inflation expectations that are in line with the tar-
get. Over a decade of delivering close to 2 per cent
inflation has helped keep inflation expectations
anchored, and there is evidence to suggest that
shocks to the price level have less impact on the
economy when that anchor is strong.
The BoE is learning that the work that went into
creating that anchor is now hampering its
attempts to use QE to move the economy.
QE can only work if inflation expectations are
allowed to rise. And guess what: even though infla-
tion is above 5 per cent, the BoE is still committed
to hitting 2 per cent inflation and still forecasts
that it will return to this level soon. To quote the
standard macroeconomic textbook by David
Romer, agents may reasonably believe that the
central bank will largely undo the increase in the
money stock as soon as it starts to have an impor-
tant effect on aggregate demand. As a result,
expected inflation may not rise, and the open-mar-
ket purchase may have little effect. He is talking
about Japan, but with Citi reporting that the UK
publics inflation expectations have hit a five month
low the basic point is apt above target inflation
makes little difference if expectations remain
anchored.
We now have the odd situation where those
warning of impending hyperinflation the sternest
critics of QE provide the intellectual prerequisites
for it to work. By contrast, in pandering to those
concerns, its proponents ensure that it will not. I
would not recommend it, but for QE to work the
BoE needs to up anchor and credibly commit to
reckless and rampant inflation.
Anthony J. Evans is Associate Professor of
Economics at Londons ESCP Europe Business
School, and Fulbright Scholar-in-Residence at
San Jose State University.
His website is www.anthonyjevans.com.
Anchors aweigh: King
has to let UK prices rip
Email: theforum@cityam.com
Twitter: @cityamforum
In association with
BY ANTHONY J. EVANS
30
Wealth Management
CITYA.M. 15 NOVEMBER 2011
LON GD ONCE FIX AM...........1780.50 16.50
SILVER LDN FIX AM ..................34.30 -0.23
MAPLE LEAF 1 OZ ....................36.68 0.60
LON PLATINUM AM................1650.00 24.00
LON PALLADIUM AM...............659.00 11.00
ALUMINIUM CASH .................2176.00 -18.50
COPPER CASH ......................7347.00 36.50
LEAD CASH...........................2025.50 24.50
NICKEL CASH......................22675.00 480.00
TIN CASH.............................17500.00 250.00
ZINC CASH ............................2215.00 32.50
BRENT SPOT INDEX................114.16 0.78
SOYA .....................................1166.00 8.00
COCOA..................................2489.00 -15.00
COFFEE...................................233.95 3.95
KRUG.....................................1849.10 14.30
WHEAT ....................................148.75 -1.00
AIR LIQUIDE........................................89.37 -1.38 100.65 80.90
ALLIANZ..............................................75.00 -1.25 108.85 56.16
ANHEUS-BUSCH INBEV ....................42.33 -0.72 45.11 33.85
ARCELORMITTAL...............................13.93 -0.36 28.55 10.47
AXA......................................................10.41 -0.20 16.16 7.88
BANCO SANTANDER...........................5.65 -0.16 9.20 5.05
BASF SE..............................................51.19 -0.41 70.22 42.19
BAYER.................................................47.03 -1.07 59.44 35.36
BBVA......................................................5.97 -0.20 9.17 4.94
BMW ....................................................58.16 -0.57 73.85 43.49
BNP PARIBAS.....................................31.82 -0.42 59.93 22.72
CARREFOUR ......................................19.66 -0.58 34.12 14.66
CRH PLC .............................................13.50 -0.05 17.40 10.28
DAIMLER.............................................33.66 -0.39 59.09 30.52
DANONE..............................................48.24 -0.71 53.16 41.92
DEU.BOERSE OFFRE ........................40.63 -1.18 55.75 35.46
DEUTSCHE BANK..............................28.64 -0.36 48.70 20.79
DEUTSCHE TELEKOM.........................9.38 -0.05 11.38 7.88
E.ON.....................................................17.35 -0.45 25.54 12.50
ENEL......................................................3.22 -0.07 4.86 2.81
ENI .......................................................15.60 -0.10 18.66 11.83
FRANCE TELECOM............................12.61 -0.16 17.10 11.12
GDF SUEZ ...........................................19.80 -0.70 30.05 18.32
GENERALI ASS...................................12.31 -0.11 17.05 10.34
IBERDROLA..........................................4.85 -0.10 6.50 4.29
INDITEX ...............................................65.47 -0.33 69.40 50.92
ING GROEP CVA...................................5.67 -0.25 9.50 4.21
INTESA SANPAOLO.............................1.23 -0.05 2.47 0.85
KON.PHILIPS ELECTR.......................14.31 -0.20 25.45 12.01
L'OREAL..............................................78.19 -0.31 91.24 68.83
LVMH..................................................116.75 -0.25 132.65 94.16
MUNICH RE.........................................90.73 -1.04 126.00 77.80
NOKIA....................................................4.81 -0.12 8.49 3.33
REPSOL YPF.......................................21.89 -0.46 24.90 17.31
RWE.....................................................29.39 -0.79 55.88 21.22
SAINT-GOBAIN...................................30.68 -0.69 47.64 26.07
SANOFI ................................................49.51 -0.14 56.82 42.85
SAP......................................................44.04 -0.31 46.15 32.88
SCHNEIDER ELECTRIC.....................40.49 -0.98 61.83 35.94
SIEMENS .............................................73.41 -0.73 99.39 62.13
SOCIETE GENERALE.........................18.63 -0.23 52.70 14.32
TELECOM ITALIA..................................0.88 -0.01 1.16 0.70
TELEFONICA ......................................13.86 -0.33 18.75 12.50
TOTAL..................................................37.60 -0.04 44.55 29.40
UNIBAIL-RODAMCO SE...................133.45 -3.60 162.95 124.05
UNICREDIT............................................0.77 -0.05 2.03 0.64
UNILEVER CVA...................................24.39 -0.30 25.13 20.90
VINCI ....................................................32.53 -0.76 45.48 29.49
VIVENDI ...............................................15.89 0.02 22.07 14.10
VOLKSWAGEN VORZ ......................127.60 -3.00 152.20 86.40
Price Chg High Low
EUSHARES
WORLD INDICES
FTSE 100 . . . . . . . . . . . . . . 5519.04 -26.34 -0.47
FTSE 250 INDEX . . . . . . . 10347.76 -41.54 -0.40
FTSE UK ALL SHARE . . . . 2844.36 -12.66 -0.44
FTSE AIMALL SH . . . . . . . . 725.49 -2.50 -0.34
DOWJONES INDUS 30 . . 12078.98 -74.70 -0.61
S&P 500 . . . . . . . . . . . . . . . 1251.78 -12.07 -0.96
NASDAQ COMPOSITE . . . 2657.22 -21.53 -0.80
FTSEUROFIRST 300 . . . . . . 975.47 -9.15 -0.93
NIKKEI 225 AVERAGE. . . . 8603.70 89.23 1.05
DAX 30 PERFORMANCE. . 5985.02 -72.01 -1.19
CAC 40 . . . . . . . . . . . . . . . . 3108.95 -40.43 -1.28
SHANGHAI SE INDEX . . . . 2528.71 47.63 1.92
HANG SENG. . . . . . . . . . . 19508.18 371.01 1.94
S&P/ASX 20 INDEX . . . . . . 2589.40 0.00 0.00
ASX ALL ORDINARIES . . . 4369.10 0.00 0.00
BOVESPA SAO PAOLO. . 58258.23 -288.74 -0.49
ISEQ OVERALL INDEX . . . 2694.68 -2.43 -0.09
STI . . . . . . . . . . . . . . . . . . . . 2778.97 34.80 1.27
IGBM. . . . . . . . . . . . . . . . . . . 839.32 -18.66 -2.17
SWISS MARKET INDEX. . . 5661.71 12.68 0.22
Price Chg %chg
3M........................................................81.87 -0.42 98.19 68.63
ABBOTT LABS ...................................54.24 -0.29 55.61 45.07
ALCOA ................................................10.38 -0.22 18.47 8.45
ALTRIA GROUP..................................27.62 -0.16 28.14 23.20
AMAZON.COM..................................218.93 1.54 246.71 156.77
AMERICAN EXPRESS........................49.45 -0.92 53.80 41.25
AMGEN INC.........................................57.33 -0.53 61.53 47.66
APPLE...............................................379.26 -5.36 426.70 297.76
AT&T....................................................29.19 -0.23 31.94 27.20
BANK OF AMERICA.............................6.05 -0.16 15.31 5.13
BERKSHIRE HATAW B.......................75.86 -1.11 87.65 65.35
BOEING CO.........................................67.94 1.02 80.65 56.01
BRISTOL MYERS SQUI ......................31.51 -0.28 33.27 20.05
CATERPILLAR....................................96.53 0.40 116.55 67.54
CHEVRON.........................................106.17 -0.88 110.01 80.41
CISCO SYSTEMS................................18.94 -0.08 22.34 13.30
CITIGROUP.........................................28.38 -0.95 51.50 21.40
COCA-COLA.......................................67.79 -0.33 71.77 61.29
COLGATE PALMOLIVE......................88.65 -0.52 94.89 74.86
CONOCOPHILLIPS.............................71.70 -0.44 81.80 58.65
CVS/CAREMARK................................38.77 -0.47 39.50 29.45
DU PONT(EI) DE NMR........................48.25 -0.27 57.00 37.10
EXXON MOBIL....................................78.96 -0.76 88.23 63.47
GENERAL ELECTRIC.........................16.10 -0.20 21.65 14.02
GOOGLE A........................................613.00 4.65 642.96 473.02
HEWLETT PACKARD.........................27.32 -0.26 49.39 19.92
HOME DEPOT.....................................38.25 0.19 39.38 28.13
IBM.....................................................187.35 -0.03 190.53 141.18
INTEL CORP .......................................24.63 -0.22 26.78 19.16
J.P.MORGAN CHASE.........................32.55 -0.73 48.36 27.85
JOHNSON & JOHNSON.....................64.91 -0.34 68.05 57.50
KRAFT FOODS A................................35.43 -0.14 36.30 24.30
MC DONALD'S CORP ........................94.06 -0.70 95.45 72.14
MERCK AND CO. NEW......................35.67 -0.30 37.65 29.47
MICROSOFT........................................26.76 -0.15 29.46 23.65
OCCID. PETROLEUM.........................97.81 -2.00 117.89 66.36
ORACLE CORP...................................32.30 -0.07 36.50 24.72
PEPSICO.............................................62.80 -0.48 71.89 58.50
PFIZER ................................................19.79 -0.20 21.45 16.25
PHILIP MORRIS INTL .........................71.21 -0.43 72.74 55.85
PROCTER AND GAMBLE ..................63.05 -0.84 67.72 56.57
QUALCOMM INC ................................57.10 0.48 59.84 45.98
SCHLUMBERGER ..............................75.62 -0.92 95.64 54.79
TRAVELERS CIES..............................57.53 -0.90 64.17 45.97
UNION PACIFIC ................................102.97 0.09 107.89 77.73
UNITED TECHNOLOGIE ....................79.05 -0.78 91.83 66.87
VERIZON COMMS ..............................37.00 -0.52 38.95 31.60
WAL-MART STORES..........................58.89 -0.31 59.40 48.31
WALT DISNEY CO ..............................36.12 -0.58 44.34 28.19
WELLS FARGO & CO.........................25.10 -0.55 34.25 22.58
COMMODITIES CREDIT & RATES
BoE IR Overnight ............................0.500 0.00
BoE IR 7 days.................................0.500 0.00
BoE IR 1 month ..............................0.500 0.00
BoE IR 3 months ............................0.500 0.00
BoE IR 6 months ............................0.500 0.00
LIBOR Euro - overnight ..................0.648 0.00
LIBOR Euro - 12 months ................1.997 0.00
LIBOR USD - overnight...................0.142 0.00
LIBOR USD - 12 months.................0.985 0.01
HaIifax mortgage rate .....................3.990 0.00
Euro Base Rate ...............................1.500 0.00
Finance house base rate................1.000 0.00
US Fed funds...................................0.250 0.00
US Iong bond yieId .........................3.080 -0.03
European repo rate.........................0.489 -0.01
Euro Euribor ....................................0.921 0.00
The vix index ...................................32.80 2.76
The baItic dry index ........................1.835 0.00
Markit iBoxx...................................239.12 0.14
Markit iTraxx..................................172.34 -12.85
Price Chg High Low
Price Chg %chg Price Chg %chg Price Chg %chg
USSHARES
BAE Systems . . . . . .285.8 2.5 361.1 248.1
Chemring Group . . . .517.5 -3.0 736.5 485.0
Cobham . . . . . . . . . . .181.2 0.6 236.5 168.5
Meggitt . . . . . . . . . . . .385.5 1.7 397.6 304.9
QinetiQ Group . . . . . .121.0 -0.3 136.3 97.0
RoIIs-Royce Group . .727.0 -11.0 739.5 557.5
Senior . . . . . . . . . . . . .166.2 -1.8 190.6 132.6
UItra EIectronics . . .1595.0 -12.0 1830.0 1305.0
GKN . . . . . . . . . . . . . .192.9 0.0 245.0 157.0
BarcIays . . . . . . . . . . .174.1 -4.9 333.6 138.9
HSBC HoIdings . . . . .504.7 1.4 730.9 473.6
LIoyds Banking Gr . . .28.4 -0.5 69.9 27.2
RoyaI Bank of Sco . . .21.9 -0.5 49.0 19.7
Standard Chartere .1356.5 -45.5 1901.5 1169.5
AG Barr . . . . . . . . . .1270.0 11.0 1395.0 1031.0
Britvic . . . . . . . . . . . . .330.0 -0.7 503.5 289.9
Diageo . . . . . . . . . . .1320.5 -7.5 1344.0 1112.0
SABMiIIer . . . . . . . . .2212.0 -39.0 2354.5 1979.0
AZ EIectronic Mat . . .240.0 0.0 338.1 206.1
Croda Internation . .1763.0 -23.0 2081.0 1367.0
EIementis . . . . . . . . . .139.5 1.5 187.4 104.8
Johnson Matthey . .1860.0 -25.0 2119.0 1523.0
Victrex . . . . . . . . . . .1180.0 -27.0 1590.0 1025.0
YuIe Catto & Co . . . . .158.9 -1.9 253.0 148.0
C/$ 1.3601 0.0121
C/ 0.8561 0.0011
C/ 104.85 1.0750
/C 1.1671 0.0014
/$ 1.5911 0.0154
/ 122.67 1.3510
FTSE 100
5519.04
26.34
FTSE 250
10347.76
41.54
FTSE ALLSHARE
2844.36
12.66
DOW
12079.98
74.02
NASDAQ
2657.22
21.53
S&P 500
1251.78
12.07
RPC Group . . . . . . . .351.1 -3.1 384.8 215.4
Smiths Group . . . . . .954.5 7.5 1429.0 907.5
Brown (N.) Group . . .262.4 0.2 311.2 251.1
Carpetright . . . . . . . . .447.0 -3.0 835.5 440.1
Debenhams . . . . . . . . .65.0 1.5 75.7 51.2
Dignity . . . . . . . . . . . .826.0 11.5 854.5 644.0
Dixons RetaiI . . . . . . .11.9 0.1 26.6 10.6
DuneImGroup . . . . . .501.0 3.0 550.0 383.9
HaIfords Group . . . . .340.0 -1.1 459.7 268.6
Home RetaiI Group . . .81.1 -3.3 235.0 80.6
Inchcape . . . . . . . . . .330.1 -4.1 425.4 268.1
JD Sports Fashion . .830.0 0.0 1030.0 770.5
Kesa EIectricaIs . . . . .89.9 -3.5 174.0 80.0
Kingfisher . . . . . . . . .252.8 -3.2 287.1 217.0
Marks & Spencer G . .330.9 -1.0 403.9 301.8
Mothercare . . . . . . . .160.0 1.5 627.5 151.0
Next . . . . . . . . . . . . .2801.0 16.0 2818.0 1868.0
Sports Direct Int . . . .239.0 1.1 266.2 127.0
WH Smith . . . . . . . . . .524.5 5.5 558.0 433.8
Smith & Nephew . . . .572.5 14.5 742.0 521.0
Synergy HeaIth . . . . .849.5 4.5 981.0 799.0
Barratt DeveIopme . . .92.8 1.7 119.0 67.5
BeIIway . . . . . . . . . . . .713.5 3.0 753.5 511.0
BaIfour Beatty . . . . . .236.0 -1.1 357.3 228.6
GaIIiford Try . . . . . . . .487.5 -2.5 530.0 276.5
Kier Group . . . . . . . .1397.0 -17.0 1448.0 1097.0
Drax Group . . . . . . . .554.0 -17.5 573.0 353.6
SSE . . . . . . . . . . . . . .1317.0 -8.0 1423.0 1111.0
Domino Printing S . .540.0 -11.0 705.0 434.3
HaIma . . . . . . . . . . . . .340.0 -3.0 429.6 306.3
Laird . . . . . . . . . . . . . .147.1 0.6 207.0 127.9
Morgan CrucibIe C . .271.9 -5.2 357.1 222.3
Oxford Instrument . .842.5 22.5 1010.0 495.0
Renishaw . . . . . . . . . .950.5 15.5 1886.0 862.0
Spectris . . . . . . . . . .1294.0 -42.0 1679.0 1039.0
Aberforth SmaIIer . . .532.0 -3.5 714.0 508.5
AIIiance Trust . . . . . .340.0 1.7 392.7 310.2
Bankers Inv Trust . . .383.7 2.7 428.0 346.5
BH GIobaI Ltd. GB .1200.0 10.0 1213.0 1058.0
BH GIobaI Ltd. US . . . .11.9 0.1 12.2 10.4
BH Macro Ltd. EUR . . .20.0 -0.2 20.2 15.8
BH Macro Ltd. GBP 2061.0 -4.0 2075.0 1630.0
BH Macro Ltd. USD . . .19.9 0.0 20.1 15.8
BIackRock WorId M .657.5 -2.0 815.5 574.5
BIueCrest AIIBIue . . .167.7 0.0 176.2 162.4
British Assets Tr . . . .118.9 -0.1 140.5 109.0
British Empire Se . . .453.5 6.0 533.0 409.9
CaIedonia Investm .1498.0 -8.0 1928.0 1470.0
City of London In . . .279.0 -2.0 306.9 257.0
Dexion AbsoIute L . .135.4 -0.2 151.0 130.0
Edinburgh Dragon . .221.0 2.8 262.1 201.4
Edinburgh Inv Tru . . .468.8 2.4 492.2 414.9
EIectra Private E . . .1462.0 -8.0 1755.0 1287.0
F&C Inv Trust . . . . . .289.6 -0.8 327.9 261.5
FideIity China Sp . . . . .79.0 1.0 125.0 70.0
FideIity European . . .996.5 -13.5 1287.0 912.0
HeraId Inv Trust . . . . .456.4 4.0 545.5 419.0
HICL Infrastructu . . . .118.6 0.0 121.3 112.7
Impax Environment . .94.5 0.7 130.5 88.5
JPMorgan American .826.0 2.0 916.0 721.5
JPMorgan Asian In . .194.0 0.5 250.8 170.1
JPMorgan Emerging .521.5 5.0 639.0 480.1
JPMorgan European .697.0 -1.0 983.5 689.0
JPMorgan Indian I . . .357.4 -2.1 492.0 350.0
JPMorgan Russian .510.0 18.0 755.0 415.1
Law Debenture Cor . .356.7 3.7 385.0 309.8
MercantiIe Inv Tr . . . .908.0 -9.0 1137.0 856.5
Merchants Trust . . . .364.0 -2.1 431.8 347.0
Monks Inv Trust . . . .317.8 0.8 367.9 298.1
Murray Income Tru . .610.0 -1.5 673.0 568.0
Murray Internatio . . .905.5 10.5 991.5 818.5
PerpetuaI Income . . .250.0 -0.1 276.0 234.8
PersonaI Assets T .33840.0 30.0 33920.030210.0
PoIar Cap TechnoI . .344.5 3.0 391.2 299.5
RIT CapitaI Partn . . .1336.0 0.0 1360.0 1131.0
Scottish Inv Trus . . . .450.0 0.0 524.0 417.0
Scottish Mortgage . .640.5 3.0 781.0 586.5
SVG CapitaI . . . . . . . .192.0 -1.7 279.8 187.9
TempIe Bar Inv Tr . . .856.0 -11.0 952.0 791.0
TempIeton Emergin .568.0 0.5 689.5 497.0
TR Property Inv T . . .162.1 -1.1 206.1 150.0
TR Property Inv T . . . .74.0 -1.4 94.0 69.5
Witan Inv Trust . . . . .449.0 2.0 533.0 401.5
3i Group . . . . . . . . . . .201.8 -3.0 340.0 184.1
3i Infrastructure . . . .120.2 0.2 125.2 113.1
Aberdeen Asset Ma .194.5 0.2 240.0 167.8
Ashmore Group . . . .340.9 -5.3 420.0 301.5
Brewin DoIphin Ho . .124.5 0.5 185.4 113.7
CameIIia . . . . . . . . . .9375.0 125.010950.0 8800.0
CharIes TayIor Co . . .135.0 0.0 185.3 122.0
City of London Gr . . . .64.0 0.0 93.6 63.0
City of London In . . .349.9 2.4 461.5 321.3
CIose Brothers Gr . . .710.0 -5.0 888.5 656.5
CoIIins Stewart H . . . .54.5 0.5 90.8 54.0
EvoIution Group . . . . .82.5 -1.5 94.0 62.3
F&C Asset Managem .70.1 0.4 92.9 56.1
Hargreaves Lansdo .502.0 -9.0 646.5 402.5
HeIphire Group . . . . . . .2.8 0.1 19.3 2.2
Henderson Group . . .116.1 -0.7 173.1 95.1
Highway CapitaI . . . . .12.0 0.0 21.0 6.5
ICAP . . . . . . . . . . . . . .363.1 -7.4 570.5 350.4
IG Group HoIdings . .445.2 -7.6 528.0 393.6
Intermediate Capi . . .227.5 -0.7 360.3 197.9
InternationaI Per . . . .220.0 -2.8 388.8 196.5
InternationaI Pub . . . .116.8 0.1 118.3 108.6
Investec . . . . . . . . . . .367.2 -7.0 538.0 331.8
IP Group . . . . . . . . . . . .75.3 -1.3 77.8 29.9
Jupiter Fund Mana . .216.7 -2.2 337.3 184.9
Liontrust Asset M . . . .75.5 17.3 94.3 57.9
LMS CapitaI . . . . . . . . .59.5 0.0 64.8 44.8
London Finance & . . .23.0 0.0 23.5 16.5
London Stock Exch .863.5 -7.0 1076.0 717.0
Lonrho . . . . . . . . . . . . .13.5 0.5 19.8 11.8
Man Group . . . . . . . . .146.1 -3.1 311.0 136.0
Paragon Group Of . .178.9 -0.5 206.1 134.6
Provident Financi . .1020.0 -16.0 1124.0 728.5
Rathbone Brothers .1127.0 0.0 1257.0 972.0
Record . . . . . . . . . . . . .16.6 0.0 43.0 16.0
RSM Tenon Group . . .22.0 -0.5 66.3 20.3
Schroders . . . . . . . .1362.0 -31.0 1922.0 1183.0
Schroders (Non-Vo .1140.0 -23.0 1554.0 970.0
TuIIett Prebon . . . . . .316.0 1.0 428.6 305.5
WaIker Crips Grou . . .46.0 0.0 51.5 45.0
BT Group . . . . . . . . . .191.9 1.0 204.1 161.0
CabIe & WireIess . . . .38.3 0.1 52.9 31.3
CabIe & WireIess . . . .30.2 -0.2 76.9 26.3
COLT Group SA . . . .101.1 0.6 156.2 91.6
KCOM Group . . . . . . . .73.0 1.0 84.0 49.0
TaIkTaIk TeIecom . . .128.5 -4.2 168.3 119.8
TeIecomPIus . . . . . . .727.0 13.0 750.5 379.8
Booker Group . . . . . . .77.3 -0.6 80.0 54.5
Greggs . . . . . . . . . . . .509.0 -3.5 550.5 429.1
Morrison (Wm) Sup .317.8 0.4 318.6 262.7
Ocado Group . . . . . . . .86.0 -0.2 285.0 84.8
Sainsbury (J) . . . . . . .304.0 -3.1 391.5 263.5
Tesco . . . . . . . . . . . . .402.8 -0.9 439.0 356.3
Associated Britis . . .1121.0 -11.0 1182.0 940.0
Cranswick . . . . . . . . .710.0 -3.0 883.5 588.5
Dairy Crest Group . . .340.0 2.4 424.9 325.0
Devro . . . . . . . . . . . . .259.9 -3.1 296.9 223.5
Premier Foods . . . . . . . .5.7 -0.7 35.1 3.3
Tate & LyIe . . . . . . . . .671.5 -6.0 684.5 510.0
UniIever . . . . . . . . . .2062.0 -15.0 2114.0 1777.0
Mondi . . . . . . . . . . . . .456.4 -6.6 664.0 448.1
Centrica . . . . . . . . . . .303.7 0.4 345.8 282.6
InternationaI Pow . . .334.1 -4.4 448.6 279.4
NationaI Grid . . . . . . .624.5 -4.5 649.5 530.0
Pennon Group . . . . . .712.0 -9.5 737.5 584.5
Severn Trent . . . . . .1583.0 -16.0 1607.0 1368.0
United UtiIities . . . . .629.0 -2.0 635.6 543.5
Cookson Group . . . . .473.6 7.8 724.5 395.8
DS Smith . . . . . . . . . .202.9 -2.5 266.2 164.4
Rexam . . . . . . . . . . . .332.2 -2.8 400.0 299.8
Price Chg High Low
BerkeIey Group Ho .1253.0 11.0 1299.0 789.5
Bovis Homes Group .451.7 0.7 485.5 326.5
Persimmon . . . . . . . .491.6 5.1 518.5 338.4
Reckitt Benckiser . .3222.0 -37.0 3648.0 3015.0
Redrow . . . . . . . . . . . .110.0 -2.0 139.0 98.4
TayIor Wimpey . . . . . . .38.3 0.8 43.3 23.8
Bodycote . . . . . . . . . .276.4 -2.1 397.7 225.6
Charter Internati . . . .920.5 -2.0 934.0 538.5
Fenner . . . . . . . . . . . .364.8 -3.1 422.5 273.7
IMI . . . . . . . . . . . . . . . .793.0 -16.0 1119.0 636.5
MeIrose . . . . . . . . . . .349.0 2.7 365.4 265.7
Northgate . . . . . . . . . .250.0 6.0 346.7 202.0
Rotork . . . . . . . . . . .1718.0 -2.0 1858.0 1501.0
Spirax-Sarco Engi . .1869.0 -11.0 2063.0 1649.0
Weir Group . . . . . . .1905.0 -55.0 2218.0 1375.0
Ferrexpo . . . . . . . . . . .312.7 -2.5 499.0 238.7
TaIvivaara Mining . . .205.5 -10.5 622.0 204.5
BBAAviation . . . . . . .182.0 -0.5 240.8 156.0
Stobart Group Ltd . . .119.5 1.4 163.6 117.5
AdmiraI Group . . . . . .832.5 -7.5 1754.0 820.0
AmIin . . . . . . . . . . . . .297.7 -1.7 427.0 270.6
Huntsworth . . . . . . . . .58.5 0.5 85.0 55.3
Informa . . . . . . . . . . . .368.4 -3.7 461.1 313.9
ITE Group . . . . . . . . . .194.4 1.4 258.2 157.7
ITV . . . . . . . . . . . . . . . . .65.8 2.1 93.5 51.7
Johnston Press . . . . . . .5.3 0.3 12.8 4.1
MecomGroup . . . . . .153.8 1.5 310.0 134.5
Moneysupermarket. .109.4 -0.1 120.4 75.7
Pearson . . . . . . . . . .1105.0 -32.0 1207.0 926.0
PerformGroup . . . . .195.0 -2.0 234.5 150.0
Reed EIsevier . . . . . .540.5 -4.5 590.5 461.3
Rightmove . . . . . . . .1395.0 -3.0 1412.0 736.5
STV Group . . . . . . . . .105.0 -0.9 168.0 90.3
Tarsus Group . . . . . .130.5 2.5 165.0 114.0
Trinity Mirror . . . . . . . .53.3 1.8 93.0 37.5
UBM . . . . . . . . . . . . . .495.1 -4.4 725.0 416.0
UTV Media . . . . . . . . .113.9 1.1 150.0 101.0
WiImington Group . . .86.0 -1.5 183.0 82.5
WPP . . . . . . . . . . . . . .662.0 -7.5 846.5 578.0
YeII Group . . . . . . . . . . .3.5 0.1 14.8 3.4
African Barrick G . . .558.0 -5.5 618.5 393.5
AIIied GoId Minin . . .151.5 -4.5 281.3 34.4
AngIo American . . .2448.0 -19.0 3437.0 2138.5
AngIo Pacific Gro . . .278.3 1.4 369.3 237.9
Antofagasta . . . . . . .1175.0 -23.0 1634.0 900.5
Aquarius PIatinum . .182.4 5.2 419.0 159.9
BeazIey . . . . . . . . . . . .128.8 -0.1 139.2 109.6
CatIin Group Ltd. . . .392.8 -6.2 421.4 331.5
Hiscox Ltd. . . . . . . . . .389.2 -4.5 424.7 340.5
Jardine LIoyd Tho . . .705.0 -2.0 764.5 571.5
Lancashire HoIdin . . .762.0 -2.5 774.5 529.0
RSA Insurance Gro . .110.1 -1.1 143.5 105.3
Aviva . . . . . . . . . . . . . .315.0 -4.0 477.9 275.3
LegaI & GeneraI G . . .105.7 -2.3 123.8 89.8
OId MutuaI . . . . . . . . .109.8 -1.7 144.8 98.1
Phoenix Group HoI . .478.0 -16.4 688.0 451.1
PrudentiaI . . . . . . . . .624.0 -12.0 777.0 509.0
ResoIution Ltd. . . . . .263.3 -7.1 316.1 211.3
St James's PIace . . . .337.7 -2.7 376.0 236.2
Standard Life . . . . . . .203.7 -2.0 244.7 172.0
4Imprint Group . . . . .225.0 -5.0 295.0 200.0
Aegis Group . . . . . . .138.0 -2.4 158.5 115.7
BIoomsbury PubIis . . .98.0 0.5 138.0 95.0
British Sky Broad . . .743.0 -5.5 850.0 618.5
Centaur Media . . . . . . .34.6 -1.4 73.0 33.8
Chime Communicati .195.8 -4.8 298.5 173.0
Creston . . . . . . . . . . . .84.8 0.8 121.0 72.0
DaiIy MaiI and Ge . . .431.0 2.5 594.5 343.4
Euromoney Institu . .690.0 -2.0 736.0 522.5
Future . . . . . . . . . . . . . .10.5 0.0 30.0 9.8
Haynes PubIishing . .225.0 5.0 257.0 203.5
BHP BiIIiton . . . . . . .1970.5 -21.5 2631.5 1667.0
Centamin Egypt Lt . .107.2 -0.2 186.7 89.7
Eurasian NaturaI . . .676.5 -7.5 1125.0 522.0
FresniIIo . . . . . . . . . .1812.0 -36.0 2150.0 1296.0
GemDiamonds Ltd. .234.1 -0.3 306.0 179.8
GIencore Internat . . .428.5 -11.5 531.1 348.0
HochschiId Mining . .446.0 1.9 680.0 397.0
Kazakhmys . . . . . . . .911.5 -20.0 1671.0 730.0
Kenmare Resources . .39.5 -1.0 59.9 23.4
Lonmin . . . . . . . . . . .1073.0 -1.0 1983.0 974.5
New WorId Resourc .459.4 -15.1 1060.0 410.5
PetropavIovsk . . . . . .742.5 -4.0 1165.0 543.5
RandgoId Resource 7400.0 0.0 7555.0 4425.0
Rio Tinto . . . . . . . . .3423.0 -44.5 4712.0 2712.5
Vedanta Resources .1120.0 -42.0 2559.0 948.0
Xstrata . . . . . . . . . . .1012.0 -18.0 1550.0 764.0
Inmarsat . . . . . . . . . . .461.7 -7.0 719.5 389.7
Vodafone Group . . . .182.7 2.7 183.9 155.1
Genesis Emerging . .456.5 -1.5 568.0 430.0
Afren . . . . . . . . . . . . . . .86.5 0.7 171.2 73.6
BG Group . . . . . . . . .1362.5 -3.5 1564.5 1144.0
BP . . . . . . . . . . . . . . . .458.8 0.5 509.0 363.2
Cairn Energy . . . . . . .290.4 -5.0 469.7 261.4
EnQuest . . . . . . . . . . .102.4 -2.2 158.5 86.6
Essar Energy . . . . . .287.0 -1.8 589.5 235.1
ExiIIon Energy . . . . . .298.4 -6.5 469.7 184.2
Heritage OiI . . . . . . . .198.0 -4.0 486.0 190.0
Ophir Energy . . . . . . .250.0 -2.1 299.0 184.5
Premier OiI . . . . . . . . .359.6 -0.9 535.0 310.0
RoyaI Dutch SheII . .2222.0 16.0 2326.5 1883.5
RoyaI Dutch SheII . .2296.5 27.5 2336.0 1890.5
SaIamander Energy .213.0 4.2 317.6 182.3
Soco Internationa . . .313.4 -2.5 400.0 279.8
TuIIow OiI . . . . . . . . .1347.0 -21.0 1493.0 945.5
Amec . . . . . . . . . . . . .924.0 -10.0 1251.0 740.5
Hunting . . . . . . . . . . .675.5 12.0 817.0 530.0
Kentz Corporation . .471.0 -5.5 508.0 275.5
LampreII . . . . . . . . . . .259.8 5.8 395.2 220.7
Petrofac Ltd. . . . . . .1401.0 -29.0 1685.0 1108.0
Wood Group (John) .651.0 4.5 715.8 469.0
Burberry Group . . . .1421.0 44.0 1600.0 996.0
PZ Cussons . . . . . . . .372.0 -0.1 409.0 320.5
Supergroup . . . . . . . .659.0 -15.0 1820.0 591.0
AstraZeneca . . . . . .2899.0 -10.5 3194.0 2543.5
BTG . . . . . . . . . . . . . .291.7 -1.3 309.7 210.1
Genus . . . . . . . . . . . .1022.0 22.0 1111.0 800.0
GIaxoSmithKIine . . .1394.0 -1.5 1403.0 1127.5
Hikma Pharmaceuti .639.0 -17.5 900.0 555.5
Shire PIc . . . . . . . . . .2015.0 -4.0 2136.0 1481.0
CapitaI & Countie . . .178.5 -0.5 203.7 142.5
Daejan HoIdings . . .2675.0 5.0 2954.0 2282.0
F&C CommerciaI Pr .103.7 -0.1 108.0 88.0
Grainger . . . . . . . . . . . .96.0 0.5 133.2 77.3
London & Stamford .116.0 1.0 140.0 111.6
SaviIIs . . . . . . . . . . . . .301.7 -0.9 427.1 256.2
UK CommerciaI Pro . .76.0 0.0 85.5 70.4
Unite Group . . . . . . . .167.1 -1.3 224.1 152.9
Big YeIIow Group . . .261.3 -4.4 352.2 234.2
British Land Co . . . . .503.5 -7.5 629.5 452.0
CapitaI Shopping . . .312.3 -5.0 424.8 296.4
Derwent London . . .1666.0 -7.0 1880.0 1400.0
Great PortIand Es . . .361.5 -3.0 445.0 317.4
Hammerson . . . . . . . .393.7 -6.1 490.9 353.0
Hansteen HoIdings . . .78.0 1.0 89.5 70.0
Land Securities G . . .686.5 -8.0 885.0 616.0
SEGRO . . . . . . . . . . . .233.4 -4.3 331.3 210.1
Shaftesbury . . . . . . . .503.5 -5.0 539.0 431.7
Aveva Group . . . . . .1622.0 -12.0 1799.0 1298.0
Computacenter . . . . .376.3 1.3 490.0 354.8
Fidessa Group . . . . .1687.0 21.0 2109.0 1409.0
Invensys . . . . . . . . . . .213.3 -4.9 364.3 199.6
Logica . . . . . . . . . . . . .78.8 -1.4 147.2 73.9
Micro Focus Inter . . .349.1 -5.4 426.2 239.4
Misys . . . . . . . . . . . . .291.6 1.0 420.2 214.9
Sage Group . . . . . . . .277.1 -3.9 302.0 231.7
SDL . . . . . . . . . . . . . . .635.5 5.5 711.5 555.0
TeIecity Group . . . . . .613.0 -7.5 621.0 430.0
Aggreko . . . . . . . . . .1789.0 -18.0 2034.0 1394.5
Ashtead Group . . . . .166.4 -3.6 207.9 99.4
Atkins (WS) . . . . . . . .538.0 5.0 820.0 490.2
Babcock Internati . . .695.5 -1.5 733.0 513.5
Berendsen . . . . . . . . .437.5 0.6 568.0 391.3
BunzI . . . . . . . . . . . . .806.0 -1.5 820.5 676.5
Cape . . . . . . . . . . . . . .354.9 7.0 591.5 328.0
Capita Group . . . . . . .662.0 1.0 786.5 635.5
CariIIion . . . . . . . . . . .320.9 -1.6 403.2 298.8
De La Rue . . . . . . . . .906.5 -7.5 914.0 549.5
DipIoma . . . . . . . . . . .318.0 0.0 414.3 263.3
EIectrocomponents .207.9 -0.5 294.9 182.2
Experian . . . . . . . . . . .828.5 -1.0 836.0 665.0
FiItrona PLC . . . . . . . .384.7 -0.3 397.1 227.5
G4S . . . . . . . . . . . . . . .248.1 -2.3 291.0 219.9
Hays . . . . . . . . . . . . . . .75.1 -0.3 133.6 66.6
Homeserve . . . . . . . .267.0 -0.1 532.0 218.5
Howden Joinery Gr . .107.9 -2.5 127.5 90.0
Interserve . . . . . . . . . .321.2 0.2 341.3 183.5
Intertek Group . . . . .1922.0 1.0 2148.0 1715.0
MichaeI Page Inte . . .366.7 -4.1 567.0 338.7
Mitie Group . . . . . . . .247.8 -0.7 257.5 194.1
Premier FarneII . . . . .171.5 -0.7 308.8 144.5
Regus . . . . . . . . . . . . . .85.2 0.2 119.0 64.0
RentokiI InitiaI . . . . . . .67.0 0.0 104.9 64.8
RPS Group . . . . . . . . .189.2 6.2 253.0 156.6
Serco Group . . . . . . .496.3 -3.7 618.5 490.9
Shanks Group . . . . . .113.0 -2.0 130.9 103.0
SIG . . . . . . . . . . . . . . . .92.7 0.2 153.5 83.8
SThree . . . . . . . . . . . .230.0 0.0 447.6 213.2
Travis Perkins . . . . . .840.0 -17.0 1127.0 715.0
WoIseIey . . . . . . . . .1879.0 -4.0 2261.0 1404.0
ARM HoIdings . . . . . .632.0 -2.5 651.0 351.6
CSR . . . . . . . . . . . . . .187.2 1.0 447.0 170.9
Imagination Techn . .473.3 -4.4 502.0 296.9
Pace . . . . . . . . . . . . . . .63.0 -1.6 231.8 60.3
Spirent Communica .125.8 -0.4 160.3 109.5
British American . .2893.5 -34.0 2949.0 2282.5
ImperiaI Tobacco . .2297.0 -48.0 2371.0 1784.0
Betfair Group . . . . . . .748.0 -10.0 1490.0 567.0
Bwin.party Digita . . .125.6 -0.2 257.6 100.6
CarnivaI . . . . . . . . . .2185.0 -1.0 3153.0 1742.0
Compass Group . . . .560.5 -7.5 612.0 512.5
Domino's Pizza UK . .438.6 -2.9 586.0 377.0
easyJet . . . . . . . . . . . .366.0 10.6 474.0 301.0
FirstGroup . . . . . . . . .339.4 -5.9 412.6 301.8
Go-Ahead Group . . .1318.0 4.0 1598.0 1203.0
Greene King . . . . . . .452.6 0.5 518.0 410.0
InterContinentaI . . .1071.0 -17.0 1435.0 955.0
InternationaI Con . . .147.6 -1.1 305.0 141.6
JD Wetherspoon . . . .429.3 -0.7 468.3 380.5
Ladbrokes . . . . . . . . .134.9 -1.7 155.3 114.0
Marston's . . . . . . . . . . .93.5 -0.4 117.1 84.6
MiIIennium& Copt . .400.5 -3.2 600.5 375.6
MitcheIIs & ButIe . . . .226.6 -0.6 361.0 216.4
NationaI Express . . .224.0 -0.3 270.2 218.3
Rank Group . . . . . . . .144.9 -5.1 153.7 109.5
Restaurant Group . . .289.6 -1.4 335.0 254.9
Stagecoach Group . .254.2 2.4 272.4 200.0
Thomas Cook Group .45.2 0.7 204.8 33.7
TUI TraveI . . . . . . . . . .164.1 1.0 271.9 137.2
Whitbread . . . . . . . .1628.0 -17.0 1887.0 1409.0
WiIIiamHiII . . . . . . . . .212.2 -0.8 244.1 155.5
Abcam . . . . . . . . . . . .362.0 2.3 460.0 307.0
AIbemarIe & Bond . .323.0 4.1 400.1 272.0
Amerisur Resource . .12.8 -0.3 29.0 9.5
Andor TechnoIogy . .496.5 1.5 685.0 370.0
ArchipeIago Resou . . .64.3 -0.9 79.0 41.8
ASOS . . . . . . . . . . . .1426.0 -30.0 2468.0 1234.0
AureIian OiI & Ga . . . .26.0 1.5 92.0 16.0
Avanti Communicat .294.3 -2.5 735.0 248.5
Avocet Mining . . . . . .233.5 -3.5 286.8 177.5
BIinkx . . . . . . . . . . . . .104.5 -10.0 158.0 70.5
Borders & Souther . . .66.0 0.5 72.3 43.5
BowLeven . . . . . . . . . .99.0 -2.0 398.0 74.5
Brooks MacdonaId 1247.5 -10.0 1372.5 940.0
Cove Energy . . . . . . . .86.3 -1.3 112.8 61.0
Daisy Group . . . . . . . .99.0 0.5 127.0 88.0
EMIS Group . . . . . . . .523.0 50.5 580.0 406.0
Encore OiI . . . . . . . . . .74.8 -0.5 151.5 40.8
Faroe PetroIeum . . . .151.5 -3.5 218.3 130.0
GuIfsands PetroIe . . .188.3 0.0 401.5 142.5
GWPharmaceuticaI . .91.3 0.3 130.0 87.0
H&T Group . . . . . . . . .315.0 -5.0 395.0 277.0
Hamworthy . . . . . . . .670.0 1.0 705.0 373.8
Hargreaves Servic .1140.0 2.0 1180.0 685.0
HeaIthcare Locums . . . .3.8 -0.1 4.0 3.8
Immunodiagnostic . .895.0 15.0 1218.0 768.5
ImpeIIamGroup . . . .267.6 0.0 387.5 180.5
James HaIstead . . . . .440.0 -15.6 495.0 357.5
KaIahari MineraIs . . .222.8 -1.5 301.0 186.8
London Mining . . . . .289.5 -15.5 436.5 283.0
Lupus CapitaI . . . . . .102.0 -1.5 150.0 86.0
M. P. Evans Group . .402.0 12.0 500.5 371.0
Majestic Wine . . . . . .400.0 -16.0 510.0 362.0
May Gurney Integr . .285.8 -5.5 302.0 211.0
Monitise . . . . . . . . . . . .37.5 -0.8 40.0 18.5
MuIberry Group . . . .1520.0 -12.0 1920.0 535.0
Nanoco Group . . . . . . .53.3 3.3 114.0 38.0
NauticaI PetroIeu . . .272.0 -6.0 547.0 223.5
NichoIs . . . . . . . . . . . .534.8 2.3 579.0 410.0
Numis Corporation . . .92.0 0.5 137.8 88.2
Pan African Resou . . .14.3 0.3 14.5 9.5
Patagonia GoId . . . . . .55.5 -0.5 70.0 28.0
Prezzo . . . . . . . . . . . . .58.3 1.3 71.5 53.3
Pursuit Dynamics . . .196.0 2.0 700.0 160.5
Rockhopper ExpIor .252.0 -2.5 386.0 141.0
RWS HoIdings . . . . . .430.0 2.8 479.8 266.5
Songbird Estates . . .118.4 2.1 160.3 110.3
VaIiant PetroIeum . . .429.0 8.5 672.0 420.5
Young & Co's Brew . .640.3 2.8 712.0 542.5
JPMorgan Russian S 510.0 3.7
RPS Group . . . . . . . . .189.2 3.4
ITV . . . . . . . . . . . . . . . .65.8 3.3
Burberry Group . . . .1421.0 3.2
easyJet . . . . . . . . . . . .366.0 3.0
Aquarius PIatinum . .182.4 2.9
Oxford Instruments .842.5 2.7
Smith & Nephew . . . .572.5 2.6
Northgate . . . . . . . . . .250.0 2.5
Debenhams . . . . . . . . .65.0 2.4
Premier Foods . . . . . . . .5.7 -10.9
TaIvivaara Mining . . .205.5 -4.9
Home RetaiI Group . . .81.1 -3.9
Kesa EIectricaIs . . . . .89.9 -3.8
Vedanta Resources .1120.0 -3.6
Rank Group . . . . . . . .144.9 -3.4
Phoenix Group HoId .478.0 -3.3
Standard Chartered 1356.5 -3.3
New WorId Resource 459.4 -3.2
TaIkTaIk TeIecom G . .128.5 -3.2
Risers FaIIers
MAIN CHANGES UK 350
Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low Price Chg High Low
Price Chg High Low Price Chg High Low
GILTS
AEROSPACE & DEFENCE
CONSTRUCTION & MATERIALS
ELECTRICITY
ELECTRONIC & ELECTRICAL EQ.
EQUITY INVESTMENT INSTRUM.
FINANCIAL SERVICES
FIXED LINE TELECOMS
FOOD & DRUG RETAILERS
FOOD PRODUCERS
FORESTRY & PAPER
GAS, WATER & MULTIUTILITIES
GENERAL RETAILERS
HEALTH CARE EQUIPMENT & S.
HHOLD GDS & HOME CONSTR.
INDUSTRIAL ENGINEERING
INDUSTRIAL TRANSPORTATION
MEDIA
LIFE INSURANCE
PERSONAL GOODS
PHARMACEUTICALS & BIOTECH
REAL ESTATE INVEST. & SERV.
SOFTWARE & COMPUTER SERV.
SUPPORT SERVICES
TECHNOLOGY HARDW. & EQUIP.
TOBACCO
TRAVEL & LEISURE
AIM 50
NON LIFE INSURANCE
REAL ESTATE INVEST. TRUSTS
http://corporate.webfg.com
mailto:
globaltechsales@webfg.com
AUTOMOBILES & PARTS
BANKS
CHEMICALS
BEVERAGES
GENERAL INDUSTRIALS
MOBILE TELECOMS
OIL & GAS PRODUCERS
OIL EQUIPMENT & SERVICES
MINING
NONEQUITY INVESTM. COMM.
Tsy 3.250 11 . . . . .100.03 -0.01 102.8 100.0
Tsy 9.000 12 . . . .106.17 0.00 113.7 105.8
Tsy 5.000 12 . . . .101.39 0.00 105.6 101.3
Tsy 5.250 12 . . . .102.65 0.00 106.9 102.6
Tsy 4.500 13 . . . .105.23 0.06 108.1 105.2
Tsy 2.500 13 . . . .284.82 0.03 287.7 277.6
Tsy 8.000 13 . . . . .113.86 0.07 119.5 113.8
Tsy 5.000 14 . . . . .112.22 0.17 112.9 109.2
Tsy 4.750 15 . . . . .114.69 0.29 114.8 108.6
Tsy 8.000 15 . . . .128.32 0.28 129.2 123.7
Tsy 7.750 15 . . . .101.05 0.30 108.1 100.8
Tsy 4.000 16 . . . . .113.59 0.38 113.6 104.9
Tsy 2.500 16 . . . .342.53 0.14 343.0 310.2
Tsy 8.750 17 . . . .140.59 0.43 141.9 132.9
Tsy 12.000 17 . . .123.49 0.00 132.3 122.5
Tsy 1.250 17 . . . . .115.31 0.24 115.8 106.7
Tsy 5.000 18 . . . .121.21 0.51 121.2 109.7
Tsy 4.500 19 . . . . .119.21 0.59 119.3 105.4
Tsy 3.750 19 . . . . .113.86 0.64 113.9 99.4
Tsy 2.500 20 . . . .359.06 0.32 359.9 312.4
Tsy 4.750 20 . . . .121.66 0.68 121.7 106.6
Tsy 8.000 21 . . . .150.54 0.68 151.8 133.8
Tsy 1.875 22 . . . .124.62 0.34 125.4 111.3
Tsy 4.000 22 . . . . .116.13 0.81 116.3 99.0
Tsy 2.500 24 . . . .319.61 0.41 321.0 273.5
Tsy 5.000 25 . . . .127.90 0.91 128.1 107.4
Tsy 4.250 27 . . . . .119.33 0.96 119.4 97.9
Tsy 1.250 27 . . . . .119.68 0.29 121.0 104.6
Tsy 6.000 28 . . . .144.07 0.94 144.1 119.5
Tsy 4.750 30 . . . .126.83 0.94 126.9 103.0
Tsy 4.125 30 . . . .305.49 0.14 306.8 261.2
Tsy 4.250 32 . . . . .119.24 1.02 119.3 96.0
Tsy 4.250 36 . . . . .119.57 1.14 119.6 95.0
Tsy 4.750 38 . . . .129.22 1.18 129.3 102.8
Tsy 4.500 42 . . . .125.76 1.23 125.9 98.9
% %
L
AST Wednesday, global stock indices took a dive as
Italian bond yields soared. Having waved off George
Papandreou as Greek Prime Minister, bondholders
turned their attention to Italy. Investors began to
panic as the yield on Italys 10-year BTPs flew above 7 per
cent a level which saw Greece, Ireland and Portugal
require emergency aid. Italian bonds fell despite interven-
tion from the ECB which has been busy buying up the
countrys sovereign debt in the secondary market. With the
credit default swap market no longer functioning as an
effective insurance instrument thanks to confusion over
what constitutes a default bondholders were forced to
reduce their exposure to Italian sovereign debt by outright
selling. There was a sharp bounce on the expectation that
Prime Minister Silvio Berlusconi would resign with former
EU commissioner Mario Monti taking his place. Yet the
market showed yet again that it is generally better to trav-
el than arrive, and the relief rally at the end of last week
fizzled out in early trade yesterday.
Last weeks sell-off in Italian bonds also led to a pull-back
in the price of oil. Investors rushed to take profits follow-
ing a week-long rally which drove both WTI and Brent up
through their respective 200-day moving averages
(DMA), and a downtrend which has been in place since
the summer. Yet despite the midweek sell-off, $112.20 is
holding as support for Brent, while WTI continues to dis-
tance itself from its own 200-DMA around $95.
WTI is now back up to levels last seen at the end of July,
and $99.60 is the next important resistance level. This
marks the 61.8 per cent Fibonacci retracement of the
sell-off from May to October this year. Brents first signifi-
cant resistance level comes in at $116.60. Both contracts
have risen on growing geopolitical tensions. A report
from the International Atomic Energy Agency has raised
fears about Irans nuclear ambitions and its military
potential. In addition, inventory data from the Energy
Information Administration showed a bigger than
expected drawdown in US stockpiles. But without a last-
ing solution to Europes debt crisis, fears of slowing global
growth will once again materialise, and this will once
again put downward pressure on oil prices. As usual,
what happens to the euro dollar currency pair remains
crucial.
BERLUSCONI,
OIL AND A
LOAD OF EUROS
DAVID MORRISON
CFD MARKET STRATEGIST, GFT
Experience Binary Brilliance Visit gftuk.com/binaries or freephone 0808 208 5192
CD03UK.180.100711
facebook.com/gftmarketsuk twitter.com/gftuk
WILL OIL SLIP
IN THE NEXT HOUR?
Our new Binary platform has been designed from the ground up to make it easy,
fast and exciting to trade short-term markets.
Weve got a wide range of markets to trade each day including hourly Binaries on WTI Crude.
Take a look at our platform, its Binary Brilliant.
Trading Binaries is risky and not suitable for everyone. Dont trade more than you can aford to lose.
T
HE European political machine
flexed its muscles last week, first in
Greece and then, more significantly,
in Italy.
A nudge from its European benefactors
was enough for Greece to topple its prime
minister George Papandreou after months
of pressure and confidence votes. The
Greek parliament moved to appoint a
man who ticked all the European boxes
former European Central Bank vice presi-
dent Lucas Papademos along with a new
coalition cabinet. In doing so, it is hoped
that the next tranche of aid will be
approved on the nod avoiding a Greek
default on its debt payments due at the
end of this year. In our view, this is an
encouraging development, says Willem
Sels, UK head of investment strategy for
HSBC private bank. But Sels adds that this
is in no way the end of Greeces problems:
The debt mountain the country faces is
still prohibitively high even after the vol-
untary restructuring with the banks has
been completed, the debt-to-GDP ratio is
estimated at 120 per cent. With these lev-
els of debts, with very few signs of growth
on the horizon, it is difficult to see how
Greece will dig itself out of its problems.
But while Greek debt is seen by every-
one except Jim Corzine as a write off,
events in Italy are much more difficult to
judge. After a week where its bond yields
surged to seemingly irredeemably high
levels, Italy made the decision to sacrifice
its prime minister on the altar of the inter-
national debt markets, perhaps in the
hope that some of his potency might perk
up its economic outlook. Though the sac-
rificial dagger was wielded by Italian
hands, they were strongly guided by
European policy makers. Mr Berlusconi
has been replaced with technocrat Mario
Monti, but yesterdays markets showed lit-
tle sign of faith in the new regime in yes-
terdays 5-year bond auction, interest rates
Silvios ousting has not
had the desired effect,
writes Craig Drake
No more bunga bunga,
but bonds are still high
CITYA.M. 15 NOVEMBER 2011 31
Wealth Management| CFDs
were at 6.29 per cent, up from 5.32 per
cent indicating that significant per-
ceived risk remains.
When it comes to trading the current
situation, as Colin Cieszynski, market ana-
lyst at CMC Markets points out, with both
political and economic progress heavy
going, its difficult for either bulls or bears
to have the courage of their convictions:
Just as it took years to get into this mess,
its going to take years to get out of it, says
Cieszynski. Although there are signs of
late that key corners have been turned,
there remains the potential for hiccups
and potholes on the road to reform and
recovery. In the short term, there may be
a temptation to hedge your bets by taking
a position on volatility, but David Jones,
chief market analyst at IG Markets advises
taking a position directly on Italian bonds
it has the highest liquidity and lowest
spreads of any potential CFD options.
If the continuing failure of ECB pur-
chases of Italian bonds to gain any trac-
tion is anything to go by, betting against
Italy seems almost as attractive a proposi-
tion as an evening with their former
leaders special friends.
Berlusconi is going to have a lot more time for the more important things in life Picture: GETTY
%
Italy
Sep Oct Nov
7
5
6
ANALYSIS l Italian and Spanish 10 year bond yields
Spain

S
E
L
L
C
A
P
IT
A
L
IS
E
S
E
L
L
B
U
Y
B
U
Y
NOW A
D
V
A
N
T
A
G
E
140
120
150
140
120
150
R
E
S
P
O
N
D
R
E
S
P
O
N
D
98.5%
U
N
C
E
R
T
A
IN
T
Y
0.1 SECS
R
E
A
C
T R
E
A
C
T
U
N
C
E
R
T
A
IN
T
Y
F
L
U
C
T
U
A
T
E
C
A
P
IT
A
L
IS
E
B
U
Y
B
U
Y
N
OW
A
D
V
A
N
T
A
G
E
F
L
U
C
T
U
A
T
E
Better technology, better pricing
Ultra-fast execution and 100% platform uptime
even in volatile markets.
Try IG Markets. Open an account at igmarkets.co.uk/better
CFD trading can result in losses that exceed
your initial deposit.
Figures relate to period June - August 2011.
26
Craig Drake finds out what four contracts for difference gurus expect from
the gold and commodity markets in the weeks ahead. Heres what they said
Ask the experts: whats to come
CFDs | Wealth Management
33 CITYA.M. 15 NOVEMBER 2011
Five weird and wonderful things to get trading
1
The Vix index
The Vix, also known as the fear
index, allows traders to bet on the
expected volatility of the stock mar-
ket in the next 30 days. Mike van
Dulken, the head of research at
Accendo Markets, says: Its great if
youre long stocks or commodities.
Its a great hedge.
2
Lumber
Trading trees, or lumber as its known
in the trading world, can be an inter-
esting one. Theres not much data
available to reference, but its a fun
way to gain access to market that isnt
easy to tap. Will Hedden of IG Markets
suggests you go long when the global
economy is looking good.
5
UK Banks FTSE 350
The UK Banks FTSE 350 is a fun sec-
tor punt. Hedden says: Its great for
getting a diverse spread across all
the banks, but beware: the big play-
ers are overweight in this one.
Positive results from HSBC could
cause an uptick on a generally
falling market.
4
UK Housing Index
The liquidity in the UK housing mar-
ket is low unless the end-of-month
data has just been released. Van
Dulken says: There are places to look
for hints on the direction: interest
rates, consumer confidence and data
from the Royal Chartered Institute of
Surveyors, for instance.
3
Heating Oil
Jamieson Blake of Capital Spreads
says: Trading heating oil can be
used as a great hedge against diesel
and jet fuel. The downside of trading
this market is the heightened risk of
increased volatility swings of up to
1,000 points intraday are not
unheard of.
T
HE London Stock Exchange
has been finding things tough
recently battling against pro-
testers sitting outside its head
office and the prospect of a Europe-
wide financial transaction tax. On top
of this, several failed mergers and
takeovers of the exchange have left it
in a tricky position when compared to
the competition. On Wednesday it
releases results, and investors will be
hoping for some good news. Capital
CFDs quotes 850.9p-855.6p for
London Stock Exchanges share price.
Interdealer broker ICAPs share
price has seen better days, as it hit
an 18-month low last week.
Investors could just be being cau-
tious over financial stocks, because it
is proving increasing volumes on its
electronic platforms BrokerTec and
EBS, and solid volumes in its voice-
broking business. With global expan-
sion still very much on the agenda,
its figures, which are released tomor-
row, could prove positive for the bro-
ker. Capital Spreads quotes
361.4p-362.1p.
Traders were dabbling in Admiral
Group over the last few days, picking
up a great multi-share discount as it
can now be bought for 28 per cent
off what it was trading at just a
week ago. It is one for the brave as it
limps along suffering from severe
personal injury problems, but with a
stop loss just below 800p, traders
are hoping it may navigate calmer
waters in the weeks to come. Spread
Co offers a spread on Admiral Group
of 836.26p- 838.62p.
Burberry Group showed strong
preliminary results last month as
overseas demand, principally from
China, boosted sales. However
Burberrys price may be checked
today. Current valuations of the luxu-
ry clothing group still seem a touch
high, with several analysts issuing
sell recommendations on the stock.
That being said, the group has a good
cash position and todays interim
report may give investors a reassur-
ing sign of how the group plans to
put this to use. IG Index gives a
spread for Burberry Group of 1,419p-
1,422p.
Craig Drake
THE TIPSTER
TRADERS
HOPING FOR
LSE FIGHT BACK
CITY INDEX
JOSH RAYMOND
After the huge thrust towards the $2,000
level, gold suffered somewhat of a fall from
grace on higher metal margins and as
investors liquidated their gold profits in order
to meet equity margin calls as stocks plum-
meted at the start of August. Gold is howev-
er still viewed as a safe haven asset choice
and with Italian and Spanish bond yields ris-
ing yesterday, it could see more upside, having bounced from the $1,600
level. Data suggests that global holdings of gold in exchange-traded funds
(ETF) are on track to see the biggest inflow of funds since July, adding
weight to the view that the yellow metal is still seen as a safe haven play.
From a technical perspective, a break back above $1,800 and then $1,840
could help to push gold back towards the $1,900 level. That said, the
inverse relationship between stocks and the price of gold in the ongoing
battle between risk off and risk on has become somewhat clouded of
late. During the initial equity slump in August, there was a large recycling
of capital from stocks to gold but in the last six weeks, that recycling is
less transparent as equities have held up relatively firm in spite of the
huge uncertainty surrounding the Eurozone. This is making gold more dif-
ficult to trade as the inverse correlation between stock prices and gold
has become fragmented.
SPREADEX
JORDAN LAMBERT
Gold has become stuck in a range due to the
changing role of the dollar. In the past, gold
has generally been inversely correlated to
equity markets due to its safe haven percep-
tion. This correlation has been particularly
strong during the recovery from the credit
crunch recession, as the dollar has weakened
due to stimulus measures, making it cheaper
for buyers outside the US to purchase gold.
However, now US Treasuries have become the safe haven and this
has strengthened the dollar in the process. Global economies have
become highly indebted and less stable causing investors to shift their
money to the largest economy in the world where default is unimagin-
able. Gold is still regarded as a risk-off asset in itself although the
stronger dollar is holding it back and causing the current trading
range. In fact, gold is now moving broadly in line with equities as the
Europe situation unfolds, bad news leads to euro and equity sell-off
and dollar strengthening putting pressure on gold.
Medium to long term gold is more likely to push higher as it
becomes more of a safe asset in itself due to impending US elections
triggering further political uncertainty and putting the dollar out of
favour.
IG MARKETS
CHRIS BEAUCHAMP
In early September, gold bugs were rubbing
their hands with glee as they watched the
price of the yellow metal race to 1,900 $/oz.
Expectations were high that the much-awaited
$2,000 $/oz would be reached in short order,
but since then gold has lost some of its allure.
For many, gold had become the ultimate safe
haven, with the world and his dog rushing to
obtain some degree of protection from gyrat-
ing markets. When risk appetite reasserted itself in September, however,
there was heavy selling of gold, particularly in the popular exchange-trad-
ed fund (ETF) arena, exacerbating the fall with occasional margin hikes
doing their bit as well. However, gold has recovered some of its form of
late, pushing back towards 1,800 $/oz, now that the Eurozone crisis has
flared up again. In addition, yield-seeking investors are still stuck in a
world of low real interest rates, making gold attractive once again.
Further, with central banks becoming seemingly more blas about infla-
tion, golds use as a store of value will also come into play. Many rushed to
proclaim the gold bubble dead two months ago, but the obsequies per-
formed over this particular asset may yet prove to be premature.
ALPARI
JAMES HUGHES
Now gold has finished its relentless march
higher, traders have almost started to take
stock of the wreckage of all other asset class-
es. It was inevitable after the huge surge in
prices that, once the end came, the profit tak-
ers would be out in force moving prices signif-
icantly lower again. However, while the crisis
of confidence continues throughout global
markets, gold will still remain at the mercy of
those seeking the safe haven and nothing else. Golds push can almost be
tracked along with the volatility index. The more erratic and uncertain
markets become, the higher gold moves.
Over the last couple of days, Goldman Sachs has raised its outlook for
gold while downgrading its overall outlook on commodities. Again, this is
not hard to understand. Europe is on the verge of a deep recession, with
even those outside of the Eurozone at the mercy of poor growth and high
debt levels. As a result, a slide in demand for major commodities is almost
inevitable. Add this to the fact that this whole mess is nowhere near
being resolved and you have a recipe for a lot more uncertainty and there-
fore traders flocking back to the king of safe havens.
Episode 36: Money, Money, Money
E
mma: Youve given Nick 50,000.
David: Lent. Not given.
Emma: His business is going bust.
David: Its not going bust. Its a
cash flow issue.
Emma: Cash flow issue? Dont you peo-
ple ever learn anything?
David: What do you mean, you people?
Emma: Masters of the Universe. Financial
Harry Potters. Bankers, David. Isnt this
the sort of crazy thing that happened in
the banking crisis?
David: This is just because youve never
liked him.
Emma: Grow up David.
David: Its my money.
Emma: Your money?
David: Yes. I earned it.
Emma: So should I invoice you for every-
thing I do so that you can earn your
money?
David: Emma, look, Im sorry. I didnt
mean it like that I had a big pay
increase when I took over from Sandy.
Nick, hes my oldest friend. Im just trying
to help him.
Emma: So why didnt you tell me?
David: Because I knew youd react like
this.
Emma: Its our childrens future.
David: Its, look, its not
Emma: What? Not a lot of money?
David: No, I didnt mean
Emma: Maybe not to you. Or to our chil-
dren, it seems. But I read the banks
slashed its arts funding.
David: So what do you want? That I give
50,000 to the Arts Committee?
Emma: Dont insult me David.
David: And yes, we cut the arts grant. To
save jobs.
Emma: The jobs of over-paid bankers
who caused the crisis to start with. What
about artists with no other income?
David: Perhaps they shouldnt have taken
our money in the first place then.
Emma: Who do you think you are,
Lorenzo de Medici?
David: What? I thought we were talking
about Nick.
Emma: Arguing, David. Not talking.
Cacophony erupts from the baby alarm.
Emma glares at me, turns and leaves the
kitchen.
City Dad continues next Tuesday.
LOSING YOUR HAIR?
IT CAN BE RESTORED!
THE WIMPOLE CLINIC
Ha nna h Hous e , 1 1 - 1 6 Ma nc he s t e r S t r e e t , L ond on W1 U 4 DJ
At The Wimpole Clinic, one
of the leading hair transplant
centres in Europe, Dr. Michael
May F.R.C.S. has pioneered a
permanent solution to male
pattern baldness using
advanced follicular unit
hair transplant techniques.
For your FREE consultation
with Dr May call today on:
020 7935 1861
www. wi mpol ec l i ni c. c om
CITY DAD
A
N advert on the Tube recently
caught my eye. It was for an energy
drink with two versions: a his and
hers. His was called Wellman; hers
Wellwoman. The Boots logo on the bottom
told me that this is a humdrum, main-
stream product.
The ad was striking for one big reason: its
extremely traditional idea of man and
woman. His was blue, hers pink. I was sur-
prised that in 2011, basic branding had not
moved beyond this old, much-criticised
colour scheme.
But the adverts ideas about gender went
deeper and further back in time than blue
and pink. They had to do with energy: the
masculine instrumental versus the female
passive. In big bold lettering, Wellmans
catchline was: High Performance Drink.
Wellwoman, by contrast, was described sim-
ply as low calorie drink, in a sickly pink.
Wellman High Performance encouraged
men to maintain optimum performance
through a range of natural stimulants that
are specially for men with hectic
lifestyles. Wellwoman promised only to
help maintain health and vitality no
optimum performance for us, nor hectic
lifestyles. But Wellwomans biggest prom-
ise is delivered in the bold lettering at the
end of the blurb: Only 13 calories per
can. If we arent destined to perform opti-
mally, at least we can be slim.
A few days later I walked into the sushi
chain Itsu to once again be bowled over
by an energy drink. Tucked in next to
the fruit salad pots and salmon
sashimi was a white can with the
word Pussy scrawled across. I
commented on this to my server,
but he just shrugged I got the
feeling hed had a few surprised
women take their surprise out on
him and didnt want to go there.
Pussy, first launched in 2004 but
only widely available since this
October, has created a stir, as planned.
Stick a word like this on a can and youve
got your marketing strategy sorted
although to whom such a product is tar-
geted is less clear. The vision of one
Jonnie Shearer, who dreamt it up in his
bedroom at 21, Pussys coolly shocking,
crudely simplistic branding would suggest
that it is geared towards men, indeed to a
hyper-masculine market, albeit a less
wholesome one than Wellmans.
On the other hand, the tin is pink, black
A new granola for lads is part
of a wave of regressive macho
branding, says Zoe Strimpel
Men and women are
increasingly being
polarised in branding
campaigns, more so
during economic
downturns.
Below: the logos of
Pussy energy drink.
Wellwomans female
version and FUEL
granola for lads.
Picture: GETTY
The dubious rise of the Energy Man
and white a feminine look. Its odd,
though, to think Pussy would appeal to
women it seems more a joke at
womens expense, rather than a
drink for us. Be this as it may, the
branding has worked: whereas
before, Pussy was only available in
nightclubs, you can now find it in
Tesco via a strange partnership
with Cancer Research (the label is
partially blacked out in selected
stores), Selfridges and Itsus 35
shops. Better yet, you can now drink
Pussy on Virgin trains.
I returned to my desk after the Pussy sur-
prise to find a press release informing me
of the launch of the UKs first lads gra-
nola, soon to hit Tesco. An ex-businessman
from Dorset called Barney Mauleverer and
an ex-tank commander called Alex
Matheson, had spotted a hole in the market
for masculine cereal and gone hell for
leather, calling it FUEL and decking its box
with silhouettes of men in various poses
of hyper-activity, power and strength.
Again, I was rudely confronted by
the uncomfortable branding truism
that when it comes to men, activity,
ambition, independence and power
are the chief associations, whereas
for women in the same sector
theyre mainly weight-loss, beauty
and digestion troubles. The box rages
with masculine energy and achieve-
ment: Fuels tagline is One Life Live It.
The font has a military-style chunkiness to
it. The packet zings with phrases like
Pocket rocket fuel (this above a rather
modest suggestion that men put some gra-
nola in a sandwich bag to nibble on
throughout the day). Fuel your day and
Feeling adventurous? Try this at home
are also writ large. If a cereal can rankle a
woman, this one will do it.
But Mauleverer who was spurred to
action by men friends complaining that
there was nothing sufficiently hunky or
chunky for them in the cereal aisle may
have located a significant sensitivity. Ben, a
sports writer, says: A lads granola sounds
preposterous, but maybe it does tap into
something real. There isnt much for men
in the cereal aisle, and maybe men do feel a
little emasculated by whats there, and if I
can be so bold, whats going on in the world
in general. The promise of action and
power is deeply appealing, especially now.
Tim, a banker, appreciates the heavily
macho packaging and its promises of
achievement: Generally, cereals are for
kids, women and old people. I dont know
any manly cereals. FUEL definitely sounds
more manly.
Mauleverer certainly doesnt sound like a
macho man on the phone; hes got a soft
voice and speaks thoughtfully. We defi-
nitely dont want to alienate females, he
says. But after having done market
research, Mauleverer found that males
between 17 and 44 seemed to be trading
bowls of cereral for more on-the-go options.
This is a drive to get them back, but also to
appeal to office workers who dream of
escape: I have a number of friends stuck in
high-pressure jobs, who would far rather go
off to the Amazon, and FUEL is meant to
speak to them, he says.
My only gripe, then, is that nobody (bar
certain tampon companies) thinks activity,
physical escape, drive and individualism
are traits worth marketing to women, even
today. Kimberley Kriss, who works for
Interbrand, a brand consultancy, traces the
power of hyper-polarised gender marketing
back to basics. Growing up, what games do
boys play? Cops and robbers, war, super-
hero, saving the world etc its all very com-
petitive, all about power. Whereas what do
girls play? House, school, its all about help-
ing people. Nobodys dying, theres no
power struggle. Products like energy drinks
or cereals capitalise on this, and gender
marketing becomes very black and white.
And brands know that know selling ambi-
tion and power to men and things like
time-saving and health benefits to women
works.
However depressing the brandscape for
women, its worth remembering that in
tough economic times, marketing becomes
conservative, almost behind-the-times and
not necessarily representative. Theres
cyclical process at play, says Kriss. Whats
old becomes new again. That may be, but
when it comes to ideas of gender whether
in workplaces or on drinks tins and granola
boxes we badly need new thinking to
triumph.
Lifestyle | Trends
34 CITYA.M. 15 NOVEMBER 2011
35 CITYA.M. 15 NOVEMBER 2011
HEAD SOMMELIER AND MANAGER OF
LUTYENS RESTAURANT
ANDREW CONNOR
QUAFFERS CORNER
B
EING from the New World, Im accus-
tomed to thinking of grape growing as
a specialised activity but, in fact, in
parts of Europe it is the norm to grow
grapes as part of a pattern of mixed agricul-
ture, combining it with fruit or nut trees, per-
haps a cow or two. Wine-making equipment
represents a significant investment and is
only used for part of the year, so a group of
farmers will sometimes band together to
purchase the necessary equipment and share
its use, in what is known as a co-operative
winery.
Historically, these have not been a source
of wines of the highest quality but advances
both in technology and in mindset have led to
vast improvements and co-operative winer-
ies often now compete with the best, while
some co-ops have been producing wine at
the very highest level for generations.
There are exciting wines being made by
co-operatives in many places in, for example,
the South of France or Sardinia but today I
want to focus on a particular winery in the
north of Italy which takes its name from the
village of Terlan in which it is based, Cantina
Terlano. This area of Italy, the Alto-Adige or
Sdtirol, was a part of the Austrian empire
until the First World War and still retains an
alpine feel in terms of food and architec-
ture the language spoken locally is German.
There is a precision and elegance to the
wines produced here that could even be
described as Germanic.
The Cantina, founded in 1893 and with
over 100 members, makes wine from a num-
ber of grape varieties; among others Pinot
Bianco (Weissburgunder in German, labels
are in both languages), Pinot Nero
(Blauburgunder), Sauvignon Blanc,
Gewurztraminer and the local speciality
Lagrein (an intense and smoky red wine or a
deeply coloured ros) but an ideal introduc-
tion is the local blend Terlaner Classico, from
a mixture of Pinot Bianco, Chardonnay and
Sauvignon Blanc.
Despite being inexpensive, this is a wine
that will age gracefully (a characteristic of
this winery, they intermittently release wines
that have been aging in the cellars for
decades which are wonderfully fresh) but
this in no way diminishes its immediate
charms.
The Pinot Bianco provides a floral aroma
which meshes seamlessly with the
Sauvignon, drawing out that grapes own flo-
ral nature and subtle herbaceousness while
the Chardonnay provides body and texture.
If I could I would put a case of this wine
away every year and watch it evolve. Alas I
dont have the self-control, it doesnt last long
in my house.
Cantina Terlano wines are imported by
Astrum Wine Cellars,
www.astrumwinecellars.com
Follow Andrew on Twitter @LutyensWine
A northern
Italian co-op
proves a delight
H
OW much can one genuflect to the
gods of steak? In London these days,
the answer is a lot. And when an out-
let of Hawksmoor opens up, its prac-
tically illegal not to sink to ones knees in
praise. And then sink ones teeth in.
Youve probably already been to
Hawksmoor in Spitalfields or Seven Dials. If
you havent, we have to ask where youve
been over the past few years. After all, since
opening the Spitalfields site, Huw Gott and
Will Beckett have turned Hawksmoor into
the uncontested king of cow in London
(though Goodman and a few others nip at
its heels).
Hawksmoors latest outpost is smack
bang where it belongs: in the heart of the
Square Mile, on Basinghall Street. This
makes it a delightful option for post-work
carousing and eating in what is still a rela-
tive wasteland for the finer things in life.
Id certainly recommend starting with
the carousing, as Hawksmoors oft-imitated
cocktail list is crammed with historical
treats. I fell hard for the Silver Bullet, an icy,
martini-shaped glass of gin, lemon juice
and a fennel liqueur called Kummel, and
the Corpse Reviver No. 2, with gin, cuacao,
absinthe and lillet blanc. Sherry shaken
with fruit and topped with apple was a tart
version of some kind of retro beach cocktail
great fun.
I could have kept knocking them back
thats the problem with good cocktails,
they slide down like sweets but the mas-
sive, parquet-floored dining room, more of
an eating hall than a restaurant, drew us
on to our meaty fate.
The room is too large and canteen-like
for my taste; its also very similar to the
Seven Dials dining room, which I found dis-
appointing, as Id have thought that a base-
ment in the City would offer different
things to one in Covent Garden. Theres a
slightly slavish sense of brand building,
which could also be construed as a perfect-
ly rational if it aint broke, dont fix it
move.
After a long, catwalk-style trek to the
back of the dining room, we took our seats
at the rear of a sea of people mostly men
ensconced in convivial dealings with red
meat and red wine.
The waiter recommended the veal chop
for mains, claiming that it was particularly
outstanding just then, but we disobeyed
him, opting for the sexy porterhouse steak
for two. It was impressive to be sure: a mar-
rowy bone laid on top of the rosy pink slices
in their pewter dish, but it was too much a
steakpersons steak for me. Too much chew-
ing was required, not enough melting, to
Loosen those belts: no diets
allowed at City beef-house
put it crudely.
But I skip ahead, for the starters were
utterly delicious, and Ill return to the sides
we ordered with the steak, which were also
show-stealers.
We began with belly ribs from Plum
Puddings excellent pigs: four melting
wedges of carnivorous seduction, so mor-
eish I nearly cried when they were gone. My
grief was assuaged, though, by the home-
made soda bread toasted and served along-
side a whorl of Hawksmoor smoked
salmon, a very promising first sally into
seafood here.
So the porterhouse arrived meat lovers
will also relish the chateaubriand and the
bone-in sirloin, perhaps served with two
fried eggs or a half of lobster if theyve
ditched the diet. Our side dishes consisted
of truly terrific onion rings enormous,
sweetish, golden, almost cake-ish that
quite frankly distracted me from the meat.
But the real set-piece of the meal was the
macaroni and cheese with lobster (lobster
mac n cheese), coming in at a cool 20. If
decadence is the order of the day,
Hawksmoor is the place to do it.
Once we saw the pudding menu, we
were helpless, despite our now bulging guts
and short breath (ladies beware: I actually
had to remove my constricting dress and
finish dinner in my slip; do come with
loose-fitting clothes).
But peanut butter shortbread with salted
caramel ice cream was an offer I couldnt
refuse, and it was just as sweetly legumous
and salt-sharpened as Id hoped. The pop-
corn sundae tasted shallower.
The Hawksmoor guys have this gig down
pat from the kooky, retro menu to the
wine guy sommelier to the steak list to
the dashes of excess (lobster and macaroni
cheese indeed), to the dark and understated
cocktail bar. Theres truly something for
everyone here (apart from vegetarians).
Perhaps there is one twinge about the
experience for foodies, though: in joining
the throngs at Hawksmoor, youre embrac-
ing a fast-growing brand and signing up to
something thats popular and cool. Which
is to say that while it is a gem, Hawksmoor
is far from hidden.
Above: the dining
room at Basinghall
Street is very similar
to that at Seven
Dials.
Right: steak for two
with bone marrow.
Hawksmoors new
Guildhall site delivers
on high expectations
FOOD AND BOOZE | AROUND TOWN BY ZOE STRIMPEL
Lifestyle | Restaurant
lWith cutesy no-reservation restau-
rants opening by the bucketful in Soho,
theres now a dedicated cocktail lounge
for those who want to cut straight to the
chase after dinner or a show. Set over
two floors, the style is boho chic: velvet
sofas and button-back armchairs plus
French windows and a long and a long
bar covered in antiqued steel panels. This
is cocktails hour with a twist, though:
pop-up entertainment will feature regu-
larly, with a monthly soiree that you can
count on for singing and dancing and
plenty of jolly costume, as well as regular
celebrity DJs. The biggest plus, perhaps,
are the apertivi; free bites between 6 and
7:30. 3-4 Archer Street, W1D 7AP T: 020
7734 3342., www.archerstreet.co.uk
l Movember is in full swing at the
Devonshire Arms in Chiswick, where male
staff will run the gamut from the
Handlebar to the Hungarian. Chef David
Faunch has created a special menu of
Movember pies, with the likes of venison
and prune. Until 30 November. 126
Devonshire Road, W4 2JJ, www.devon-
shirearmspub.com
WORDS BY
ZOE STRIMPEL
Hawksmoor City
10/12 Basinghall St,
EC2V 5BQ
Tel: 020 7397 8120
thehawksmoor.co.uk
FOOD
hhhhi
SERVICE
hhhhi
ATMOSPHERE
hhhhi
Cost per person
without wine: 40
T
E
R
R
E
S
T
R
I
A
L
DOUBLE AGENT: THE EDDIE
CHAPMAN STORY BBC2, 9PM
Ben Macintyre revisits the story of
wartime double agent Eddie Chapman,
the subject matter of his best-selling
book Agent Zigzag.
LIVE INTERNATIONAL FOOTBALL
ITV1, 7.30PM
Adrian Chiles presents coverage of
England v Sweden (Kick-off 8.00pm)
at Wembley Stadium. Commentary by
Peter Drury and Andy Townsend.
JAMIES GREAT BRITAIN
CHANNEL4, 9PM
Jamie Olivers road trip takes him to
the Midlands, where his first stop is a
Leicester pub converted into one of
the citys most popular curry houses.
BBC1
SKY SPORTS 1
7pmLive International Football
10pmA League of Their Own
11pmFootball Asia 11.30pm
Footballs Greatest 12am
International Football 1.30am
Football Asia 2amInternational
Football 3.25am-6amLive Test
Cricket
SKY SPORTS 2
7pmLive Darts 11pmTest
Cricket 1am-5amDarts
SKY SPORTS 3
7pmSquash 8pmBritish
Basketball 10pmGolfing World
11pmEuropean Challenge Tour
Golf 12amGolf 1.30amGolfing
World 2.30amBritish
Basketball 4.30am-5.30am
European Challenge Tour Golf
BRITISH EUROSPORT
8pmBoxing 9.45pmGT
Academy: Road to Dubai
10pmEuro 2012 Flash 10.15pm
Inside Racing 10.45pmGT
Academy: Road to Dubai 11pm
Motorcycling 12am-1amEuro
2012: All Access
ESPN
7pmLive International Football
9pmESPN Kicks: FA Cup
9.30pmInternational Football
11.15pmESPN Kicks: Extra
11.30pmESPN Press Pass 12am
Planet Speed 12.30amFIS
Alpine Ski World Cup Report
1amLive College Football 4am
ESPN Press Pass 4.30amESPN
Kicks: FA Cup 5amSerie A
Rivals 5.30am-6amPlanet
Speed
SKY LIVING
7pmCriminal Minds 8pm
Signed By Katie Price 9pm
Americas Next Top Model 10pm
Criminal Minds 11pmBones
12amJerry Bruckheimers
Chase 1amCSI: Crime Scene
Investigation 2.40amBones
3.30amMaury 4.20amNothing
to Declare 5.10am-6amJerry
Springer
BBC THREE
7pmChildren in Need: 50
Greatest Moments 8pmHot
Like Us 9pmDont Tell the Bride
10pmEastEnders 10.30pmHim
& Her 11pmFamily Guy
11.45pmAmerican Dad!
12.30amDont Tell the Bride
1.30amHim & Her 2amHot
Like Us 3amYoung, Dumb and
Living Off Mum4am-5am
Mixed Up in the Middle East
E4
7pmHollyoaks 7.30pmHow I
Met Your Mother 8pm
Shipwrecked: The Island 9pm
Sorority Girls 10pmTool
Academy 11.05pmPhoneShop
11.35pmThe IT Crowd 12.10am
The Big Bang Theory 1.05am
Scrubs 1.55amHow I Met Your
Mother 2.20amPhoneShop
2.45amThe IT Crowd 3.15am
Ugly Betty 4amRules of
Engagement 4.20amDesperate
Housewives 5am-6amSwitched
HISTORY
7pmHeir Hunters 8pm
American Pickers 9pmCash
Cowboys 10pmSeeking Salvage
11pmAncient Aliens 12am
Planet Egypt 1amCash
Cowboys 2amSeeking Salvage
3amHeir Hunters 4am
American Pickers 5am-6am
Monster Moves
DISCOVERY
7pmWhale Wars 8pmWheeler
Dealers 9pmCoal 10pmNazi
UFO Conspiracy 11pmIce Pilots
12amBear Grylls: Urban
Survivor 1amCoal 2amNazi UFO
Conspiracy 3amDeadliest Catch
3.50amRiver Monsters 4.40am
Moon Machines 5.30am-6am
Destroyed in Seconds
DISCOVERY HOME &
HEALTH
7pmBabes in the Wood 8pmI
Didnt Know I Was Pregnant
9pmMystery Diagnosis 10pm
Baby ER 11pmBritains Fattest
Woman 12amMystery
Diagnosis 1amBaby ER 2am
Britains Fattest Woman 3amI
Didnt Know I Was Pregnant
4amA Baby Story 5am-6am
Bringing Home Baby
SKY1
8pmGlee 9pmInside Gatwick
10pmFILMK-19: The
Widowmaker: Thriller, starring
Harrison Ford. 2002. 12.40am
35mm1.10amRoad Wars 2am
Border Invasion USA 2.50am
Mental 4.20amVerminators
5.10am-6amVet Adventures
BBC2 ITV1 CHANNEL4 CHANNEL5
S
A
T
E
L
L
I
T
E
&
C
A
B
L
E
TVPICK
6pmBBC News
6.30pmBBC London News
7pmThe One Show
7.30pmEastEnders; BBC News
8pmHolby City
9pmDeath in Paradise
10pmBBC News
10.25pmRegional News;
National Lottery Update
10.35pmImagine: Alan Ayckbourn
Greetings from Scarborough
11.45pmFILMMidnight in the
Garden of Good and Evil. 1997.
2.15amWeatherview2.20amSign
Zone: Mixed Britannia 3.20am
Andrew Marrs Megacities 4.20am
Nigel Slaters Simple Cooking
4.50am-6amBBC News
6pmEggheads: Quiz show,
hosted by Jeremy Vine.
6.30pmStrictly Come Dancing
It Takes Two: With Zoe Ball.
7pmMasterChef: The
Professionals: The competitors
face a skills test involving bone
marrow.
8pmJames Mays Man Lab:
9pmCHOICE Double Agent:
The Eddie Chapman Story
10pmLifes Too Short
10.30pmNewsnight; Weather
11.20pmThe Choir: Military
Wives
12.20amBBC News
4.50am-6amClose
6pmLondon Tonight
6.30pmITV News
7pmEmmerdale
7.30pmCHOICE Live
International Football: England
v Sweden (Kick-off 8.00pm).
10.10pmITV News
10.40pmLondon News
10.45pmInternational
Football Highlights: England v
Sweden.
11.45pmFILMCaddyshack:
Comedy, starring Chevy Chase.
1980.
1.25amThe Zone; ITV News
Headlines 3.30amKojak
4.25am-5.30amITV Nightscreen
6pmThe Simpsons
6.30pmHollyoaks
7pmChannel 4 News
7.55pm4thought.tv
8pmThe Food Hospital
9pmCHOICE Jamies Great
Britain 10pmMy Transsexual
Summer 11.05pmRandom Acts
11.10pmTrue Blood 12.25amUK &
Ireland Poker Tour 1.25amSailing
1.50amExtreme Sailing Series
2.20amBeach Volleyball 3.10am
KOTV Boxing 3.35amAdidas Terrex
Coast to Coast 4.05amBritish
Rallycross Grand Prix 2011 4.30am
That Paralympic Show5am
Ultimate Frisbee 5.05am-5.55am
Great Scottish Swim
6pmHome and Away
6.25pmOK! TV
7pm5 News at 7
7.30pmHow to Take Stunning
Pictures; 5 News Update
8pmLondon: The Inside Story;
5 News at 9
9pmCSI: Miami
10pmCSI: Crime Scene
Investigation
11pmCSI: Miami 11.55pmCSI:
Crime Scene Investigation
12.45amInside Hollywood
12.55amSuperCasino 4amThe
Hotel Inspector 4.50amRough
Guide to Activity Holidays
5.05am-6amMichaelas Wild
Challenge
1 2 3 4 5 6
7
8 9
10 11
12 13 14 15
16
17 18
19
20 21
3 9 4
33 14
10 27
12 21
16 16
13 29
34 6
12 11
10 22
13 18
14 15 10
8
23
21
28
8
7
15
24
17
9
13
11
17
32
13
35
11
6
41
19
9
5
Fill the grid so that each block
adds up to the total in the box
above or to the left of it.
You can only use the digits 1-9
and you must not use the
same digit twice in a block.
The same digit may occur
more than once in a row or
column, but it must be in a
separate block.
COFFEE BREAK
Copyright Puzzle Press Ltd, www.puzzlepress.co.uk
KAKURO
QUICK CROSSWORD
LAST ISSUES
SOLUTIONS
KAKURO
WORDWHEEL
Using only the letters in the Wordwheel, you have
ten minutes to nd as many words as possible,
none of which may be plurals, foreign words or
proper nouns. Each word must be of three letters
or more, all must contain the central letter and
letters can only be used once in every word. There
is at least one nine-letter word in the wheel.
SUDOKU
Place the numbers from 1 to 9 in each empty cell so that each
row, each column and each 3x3 block contains all the numbers
from 1 to 9 to solve this tricky Sudoku puzzle.
SUDOKU
QUICK CROSSWORD
ACROSS
1 South American
rodent resembling a
small beaver (5)
4 Modify (5)
7 Glassware made
of quartz (7)
8 Location detector (5)
10 Relating to the Sun (5)
12 Consecrate (5)
14 Kingly, majestic (5)
16 Digression (5)
17 Give tongue to (5)
19 Outstanding musician (7)
20 Weight equivalent
to 16 ounces (5)
21 Very steep, almost
vertical (5)
DOWN
1 Little angel (6)
2 Measure of
three feet (4)
3 Of legs, to take
out of a folded
position (7)
5 Circumspect (8)
6 Colourless watery
uid of blood (6)
9 Hired murderer (8)
11 Gruelling (7)
13 Without breaks
between notes,
in music (6)
15 Greater (6)
18 Tall perennial
woody plant (4)
E
D
V
C
E N
S
O
R
4


4
4


P R E S C R I B E
C A U E E E
A L T E R C A L Y X
R E L E A L P
T A L L Y P A S T A
H I L N
O F T E N B L I S S
R R A G E N I
S L A N T G E C K O
E D A I A N
R E P L E N I S H
1 3 5 9 8 9 6
9 5 8 7 6 6 8 3
1 7 2 1 3 4 2
4 2 9 3 8 7 5 6 1
9 4 1 6 9 7 5
8 4 9 3 7
3 7 5 2 1 9 7
1 5 6 9 7 4 3 8 2
6 9 7 8 2 1 4
4 8 9 3 5 2 7 9
2 1 4 9 8 5 2
4
4
4
4
4
4
4
4
4
WORDWHEEL
The nine-letter word was
TACTFULLY
Lifestyle | TV&Games
CITYA.M. 15 NOVEMBER 2011 36
Sport
37 CITYA.M. 15 NOVEMBER 2011
A
FTER the controversy that sur-
rounded his comeback appear-
ance at last weeks Australian
Open, a resurgent Tiger Woods
will no doubt have afforded himself a
wry smile at having finished one shot
ahead of Adam Scott.
While that would have provided
him with a certain amount of satis-
faction, of more significance was the
manner in which he was striking the
ball again.
Hitting it flush was the verdict of
his caddy Joe LaCava, who knows a
mean ball striker when he sees one
having been on Fred Couples bag for
many years, and if thats the case
Tigers world ranking is going to be
on the rise again very soon.
Knowing the perfectionist and fero-
cious competitor that he is, Tiger will
have been disappointed with his third
round 75 and though his putting was
a little shaky, the fact he was getting
the ball from tee to green in regula-
tion 75 per cent of the time provided
the strongest indicator that his game
is on the mend.
Its no exaggeration to say its been
disastrous for golf having someone of
Tigers standing missing for the best
part of two years and his return to
form in Sydney was certainly a wel-
come shot in the arm for the game.
The sporting public loves a great
comeback story and after his travails
away from the course, coupled with
his career-threatening knee injury,
were he to return to his former glo-
ries it would cement his place as prob-
ably the greatest player that ever
lived.
Despite it being a home player in
Greg Chalmers who ended up win-
ning the tournament, it was Woods
who attracted the attention of the gal-
leries and that tells you all you need
to know about the Americans unique
appeal.
Throughout this troubled period in
his career Ive never doubted he pos-
sessed the ability to get back to the
pinnacle of the sport and with his
body back in peak condition, theres
no reason to suggest he wont add to
his Major haul for the first time since
2008, next year.
Looking at the courses that will
host next years big four events
Augusta (Masters), Olympic Club (US
Open), Royal Lytham (The Open) and
Kiawah Island (USPGA) all, because
of their length, will suit Tiger but Id
suggest Augusta will provide him
with the best opportunity of ending
his drought at the Majors.
Sam Torrance OBE is a multiple Ryder Cup-
winning golfer. He has won 21 European
Tour titles in a career spanning 40 years
and famously sank the putt that clinched
victory for Europe in the 1985 Ryder Cup.
Follow Sam on twitter @torrancesam.
Tigers return provides a welcome shot in the arm
WALES defence coach Shaun Edwards
has admitted he was open to offers
but received no approach from
England chiefs before committing to
renewing his contract.
Edwards, 45, was widely tipped as a
likely addition to the England coach-
ing set-up after his deal with the
Wales Rugby Football Union expired
last month.
But despite being inundated with
interest including from one
Premiership club, thought to be
Leicester, whom he hopes to work
with outside of international com-
mitments Twickenham did not call.
Wales is the only concrete offer
Ive had. I havent had any contact
with anyone from England, he said
yesterday. Youre always open to
offers but I havent heard anything
from the Rugby Football Union and I
wouldnt expect to. Englands coaches
are still in place.
Martin Johnsons future as England
manager remains in serious doubt
following a disastrous World Cup,
with suggestions he could quit as
soon as this week.
Edwards, who helped Wales reach
the semi-finals, added: England have
got a very good team of coaches
already. They are Six Nations champi-
ons and they have played some great
rugby in the last couple of years.
Edwards had
no contact
from England
BY FRANK DALLERES
RUGBY UNION

SPORT | IN BRIEF
Venkys: Rovers not for sale
FOOTBALL: Blackburn Rovers owners
Venky's have insisted the club is not for
sale. The Premier League strugglers had
been linked with a potential takeover by
Middle East oil giant Qatar Petroleum.
Co-owner Venkatesh Rao said: "Its not
true and nothing is going to happen like
that. Weve had no offer and were not
interested. Were here to stay with the
club. Were not interested to give it to
anybody. It's like our baby. Venkys
became the first Indian owners of a
Premier League club in November 2010.
NBA season in major doubt
BASKETBALL: The NBA Players
Association has turned down the
leagues new offer for a collective bar-
gaining agreement, casting doubt over
the entire season. The NBA had request-
ed an even split of basketball-related
income and a 72-game season beginning
on 15 December. But the NBAPAs Billy
Hunter said it would cease collective
bargaining discussions and would dis-
solve the union to pursue legal action
against the NBA. The start of the season
has already been delayed by five weeks.
Play-off joy for Spaniard
GOLF: Spains Gonzalo Fernandez-
Castano won the storm-delayed
Singapore Open at the second play-off
hole yesterday. The 31-year-old sank a
nine-foot birdie putt on the par-five 18th
to defeat Juvic Pagunsan of the
Philippines. Lightning had forced the
players off the course in an event that
had been shortened to 54 holes due to
the adverse weather conditions.
GOLF COMMENT
SAM TORRANCE
:I@:B<K
J<:FE;K<JKD8K:?
@e[`XmN\jk @e[`\j
;Xp(f],
BFCB8K81 @e[`X _Xm\ jZfi\[ *+- ]fi ]`m\ n`Zb\kj X^X`ejk
N\jk @e[`\j
@E;@81 =`ijk @eej
O O+m|||r c B+r+t| | | H EW+rs................................................... o5
V Se|W+ c B+r+t| | S+mm].............................................................. J8
R Dr+1| | Br+t|W+|te........................................................................... 9
S Tera||+r c S+mae|s | B|s|aa......................................................... J8
V l+tm+r rat aat...................................................................................... J
l S|+rm+ c B+a| | Ra+c|...................................................................... O
l|5 WZ r|o........................................................................................J
Tat+| (5 W|ts., 8.J a1ers)....................................................... J4o
=Xcc1oo, 49, ZO5, J45, J4o.
9fnc`e^1 EW+rs JO45, S+mm] 4O8, Ra+c|
5.J5, S+mae|s oOo5O, B|s|aa Z8,
Br+t|W+|te ZO9.
Ldg`i\j1 B Oterfar & R Tac|er.
J<:FE;FE<;8P@EK<IE8K@FE8C(Da|+|)1Ji`CXebX
ZJ5 (5O a1ers, w U T|+r+r+ , D P V D J+]+W+rere
5O). GXb`jkXe ZO (4o.J a1ers, Um+r A|m+| 9). Sr| l+r|+
|e+t P+||st+r |] Z5 rars.
;8IKJ
N@CC@8D?@CC>I8E;JC8DF=;8IKJ
(wa|1er|+mptar)->iflgDXkZ_\j1 V+ras O+r|s (SWe) |t
B+rr|e B+tes (w+|) 5, Ver1]r K|r (Er) |t J+mes
Ha||+r (Er) 5J, J+r De||er (Ha|) |t Arrar Var| (Er)
5, V+rt|r P|||||ps (w+|) |t V|rcert 1+r er Vaart (Ha|)
5Z, V+r| we|ster (w+|) |t Ja|r P+rt (O+r) 5.
=FFK98CC
<LIFG<8ELE;<I$)(:?8DG@FEJ?@G
HL8C@=P@E>>IFLG<@>?K
9\c^`ld%%%%%%%%%%%%%%%%% ' ) <e^cXe[%%%%%%%%%%%%%%%%%%%%%%%( (
N+essers Z Ke||] 4
E| K+aar| 9O Att. J,OOO
>IFLGK<E
?fccXe[%%%%%%%%%%%%%%%%%%%( ( JZfkcXe[%%%%%%%%%%%%%%%%%%%%%( )
V+|er Z R|aes Z
Att. 8,OOO wat|erspaar 55
>FC=
98I:C8PJJ@E>8GFI<FG<E (Sertas+ Oa|f O|a|)-=`eXc
Ie[(O|r & lr| ar|ess st+te, p+r )1(00 Oar/+|a |e/
O+st+ra (Sp+) oo o Z (|e/O+st+ra War +t t|e secar
p|+]aff |a|e), Ja1|c P+ars+r (P||) oo oo o. )'' Art|ar]
K|m (USA) O oo o4, laa|s Oast|a|/er (Rs+) Z oJ o5. )'(
D+rr] lee (N/|) o8 o5 o8, Jaast la|ter (Ne) o9 o5 o,
Ea+ra Va||r+r| (lt+) oZ o8 . )') J+mes Varr|sar oZ
o8 Z. )'* Tj++rt V+r Der w+|t (Rs+) o5 o, Jast|r Rase
o9 o5 o9. )'+ Ste1e we|ster o9 o9 oo, Arers H+rser
(Der) o9 o4 .
KF;8PJ;@8IP
(|aat|+|| .45pm ar|ess st+te)
<lifg\Xe:_Xdg`fej_`gGcXp$F]]J\Zfe[C\^
Ora+t|+ (J) 1 Tar|e] (O) (.O5) .....................................................................
Varterera (O) 1 O/ec| Repa|||c (Z) (.5) ..........................................
Parta+| (O) 1 Basr|+Her/ea1|r+ (O) (9pm) ......................................
Rep af lre|+r (4) 1 Estar|+ (O)..................................................................
@ek\ieXk`feXcDXkZ_
Er|+r 1 SWeer (8pm)...............................................................................
R
ECENT murmurings from
Chelsea and Newcastle have
once again raised the thorny
issue of stadium naming rights,
and more specifically what they are
actually worth in the Premier League.
Part of the problem is that no-one
is terribly sure. Logically, one would
use recent precedent as a guide, but
there are inherent problems with
using the best-known examples in
Englands top division.
Arsenal sold theirs to airline
Emirates in a 15-year deal worth
100m, which also included shirt
sponsorship. But that deal was struck
almost a decade ago, when the British
market was in its infancy, and the
popular belief now is that Arsenal
sold too cheaply.
Manchester City are a more con-
temporary example, having done
their deal with Etihad Airways earlier
this year, yet this example presents
multiple difficulties. Firstly, the esti-
mated 350m price for 10 years
includes the branding of stadium,
shirt and training complex, with no
available breakdown of the figures.
Secondly, and perhaps more perti-
nently, opinion varies wildly as to
whether the price paid by a company
owned by Citys owners is indeed fair,
or a sophisticated means of circum-
venting new European so-called
Financial Fair Play rules.
MOCKED
This is why industry experts are eager
for a leading Premier League team to
strike a stadium naming rights deal
soon: it would bring some much-
needed clarity to the market.
What is beyond dispute is that
naming rights are worth far more at
a new stadium than an existing one,
which fans will probably continue to
refer to by its traditional name, as
Newcastle are no doubt discovering.
Others argue, sensibly, that big
money only comes when the deal
plays globally. So Chelsea are better
placed to charge a high price, with
Champions League appearances and
world-famous stars, than Newcastle.
Experts have mocked Newcastles
belief they can attract up to 10m a
season for a combined stadium and
shirt sponsorship. But some believe
Chelsea, who are close to doing a
deal, can expect to at least match
Arsenals Emirates contract, while
others believe they could attract as
much as 10m annually, if their
ambition of leaving Stamford Bridge
for a purpose-built venue is realised.
The truth is, however, that clubs
claims about the value of their nam-
ing rights will remain in doubt until
the likes of Chelsea and Newcastle
illustrate just what market price is.
Whats in a name? The value of stadium sponsorship
SPORT BUSINESS COMMENT
FRANK DALLERES
Results
email sport@cityam.com
Shaw joins Toulon
ENGLAND team-mates Jonny
Wilkinson and Simon Shaw will be
reunited at Toulon after the latter
ended speculation surrounding his
future by signing for the French Top 14
club yesterday.
Shaw, 38, angered Wasps, where he
spent 13 seasons, last week by reneg-
ing on a deal he agreed before last
months World Cup.
Toulon, who also completed the
signing of experienced Australian back
Matt Giteau yesterday, unveiled Shaw
as cover for current injuries, describing
him as a medical joker.
OVER AND OUT | Worsley retires from rugby
FORMER England international Joe Worsley announced his retirement yesterday after
conceding defeat in his battle to overcome a persistent neck injury. The 34-year-old
Wasps stalwart, capped 78 times by his country, admitted he knew the end was nigh
during Englands pre-World Cup training camp. He said: Re-starting contact work dur-
ing the World Cup camp made it obvious that I could not continue. Picture: EMPICS
Sport
38
GROUND-TO-AIR missiles will be used
to protect London during next sum-
mers Olympic Games if deemed nec-
essary, defence secretary Philip
Hammond said yesterday, amid
increased concerns over security.
Hammond disclosed the measures
in the House of Commons, where he
faced questions about the level of pro-
visions made for London 2012 in light
of suggestions that the US is per-
turbed by current plans.
He said: I can assure you that all
necessary measures to ensure the
security and safety of the London
Olympic Games will be taken includ-
ing, if the advice of the military is
that it is required, appropriate
ground-to-air defences.
Hammond was responding to his
predecessor Liam Fox, who asked for
reassurance that there would be a
full level of multi-layered defence and
deterrence for the London Games,
including ground-to-air missiles in
London.
Fox added that ground-to-air mis-
siles had been in place at every Games
since Atlanta in 1996 as part of an
internationally accepted minimum
level of protection for the Olympics.
American government officials are
said to be considering sending hun-
dreds of their own staff, including
some from the FBI, to protect their
athletes at London 2012, owing to con-
cerns over security.
Metropolitan Police assistant com-
missioner Chris Allison, who is also
nationals Olympic security chief, said
he felt great support from the
Americans. He added: We will have
some support from other colleagues
up and down the country but it is the
British police who will be doing it.
It comes months after London 2012
organisers had to drastically revise the
number of security staff they planned
to hire to safeguard the sporting
extravaganza, from an initial estimate
of 10,000 to more than 20,000.
ENGLAND manager Fabio Capello
admits experienced campaigners such
as Steven Gerrard and Rio Ferdinand
face an uphill battle to win back their
places such has been the impact made
by their young replacements.
The likes of Phil Jones, Jack Rodwell
and Danny Welbeck, all graduates of
Stuart Pearces Under-21 side,
impressed during Saturdays 1-0 win
over world champions Spain.
Gerrard and Ferdinand, who have
won a combined total of 170 caps,
remain in the managers plans but the
emergence of so many youngsters will
make Capellos job of selecting a 23-
man squad for next summers
European Championships a tough one.
Capello said: The players who
played, Rodwell, Jones, Welbeck, did
really well. For these players it was a
really important experience.
I personally checked these players
and I am really happy with the per-
formance and the personality and the
confidence they showed. It is difficult
for young players to play with the con-
fidence that they showed with Spain.
If these players during the season
continue to improve, they will be ready
to play with us with at the Euros.
ENGLANDS John Terry insists he is
ready to resume the captaincy tonight
despite his position being under
threat from investigations into claims
he racially abused QPR defender
Anton Ferdinand.
The Football Association (FA) pre-
vented Terry from answering ques-
tions about the accusations, which he
has strenuously denied, as he faced
the media for the first time since the
alleged incident last month.
But the Chelsea skipper, who will
return to the England side against
Sweden tonight after sitting out
Saturdays win over Spain, spoke
freely enough to brush aside concerns
he could be distracted by the storm.
Im in a great state of mind and
focused on training, said Terry, who
is being investigated by police and the
FA. From my point of view, nothings
changed at all. I think the players have
showed were united no matter what
and put in a very good performance
[against Spain].
England manager Fabio Capello,
who rested Terry at the weekend in
order, he said, to test out different
defensive combinations, was equally
dismissive of questions about his
frame of mind. Hes here. He will be
with us. He will be the captain, said
the Italian. Terry admitted he feared
for his place in the side, after central
defensive duo Phil Jagielka and Joleon
Lescott excelled in his absence against
the world and European champions.
I dont feel undroppable, he
added. Ive never thought that with
England or Chelsea. If my forms not
good enough the manager is big
enough to drop anyone, as weve seen.
Every game we all feel we are playing
for our places. When you play for your
country you can never take a game
lightly.
Capello and the FA resisted calls to
omit Terry from the squad while he
was under investigation, following
the reasoning that the 30-year-old
remains innocent until proven guilty.
It is thought the Metropolitan Police
investigation could run into
December.
Chelsea manager Andre Villas-Boas
has stated his complete support for
Terry and former Blues assistant Ray
Wilkins spoke out yesterday to defend
the Stamford Bridge stalwart.
There is no way on Gods planet he
is a racist, no way whatsoever. And I
will back John 100 per cent, said
Wilkins, who worked with Terry for
two years until December 2010.
Ive no idea how this mess has aris-
en but Im stating from what I know
of the man he is not a racist. I would
think my view is shared by all of his
colleagues at Chelsea.
John is the captain of Chelsea and
has been for years, and its probably
the most multi-cultural club in world
football. Theres no way he could lead
those guys and look them in the face
if he was a racist.
Capello not
afraid to
trust youth
BY JAMES GOLDMAN
FOOTBALL

BY FRANK DALLERES
OLYMPICS

Ground-to-air missiles readied


for London 2012, says minister
Capello will hand Kyle Walker his full
debut this evening Picture: PA
BY FRANK DALLERES
FOOTBALL

ENGLAND
SWEDEN
Captain Terry
brushes off
fears about
state of mind
Terry said his
investigation had
changed nothing
Picture: ACTION
IMAGES
ICC chief executive Haroon Lorgat
has confirmed the inaugural Test
Championship, due to be staged in
England in 2013, will not take place
until 2017 at the earliest.
The rise of Twenty20 has coincid-
ed with a significant drop in Test
match attendances around the
world and Lorgat had previously
championed the competition as a
way of ensuring the sanctity of the
longest format of the game.
The new tournament would have
seen the top four ranked teams com-
pete in a knockout format with
Lords already earmarked to stage
the final. But with an already packed
calendar and broadcasters showing
little enthusiasm for the concept,
Lorgat reluctantly announced yester-
days postponement.
I am afraid that [the Test champi-
onship] is no longer going to happen
in 2013, Lorgat said. At the last
board meeting we decided the first
opportunity to play is 2017.
I am disappointed it is not going
to take place sooner but it is a reality
of the commitments we have already
got through to 2015.
Yesterdays news comes as a blow
to the Marylebone Cricket Club
(MCC), who had advocated the inclu-
sion of the tournament.
It is disappointing, MCC head of
cricket John Stephenson said. MCC
has been consistent in its support for
Test cricket and the need for govern-
ing bodies to give the five day game a
bit of a boost.
CRICKET

ICC confirm Test Championship


postponed until 2017 at earliest
39
FIA WORLD RALLY CHAMPIONSHIP.
YOU CANT CONTROL THE ELEMENTS,
BUT YOU CAN WIN THE CHAMPIONSHIP.
Congratulations to Sbastien Loeb and Daniel Elena, winners of the 2011
FIA World Rally Championship.
*
In on road rallying, driving conditions could suddenly change at any stage of
the race, so Sbastien Loeb and Daniel Elena both had to have confidence
in their tyres ability to adapt. MICHELIN tyres, with their excellent grip,
gave them that confidence, whatever the weather or terrain.
You could also benefit from the expertise Michelin has derived from
motorsport with the MICHELIN Pilot Sport 3.
Experience the performance at
www.michelin.co.uk/experience-the-performance
*Subject to the publication of the official results by FIA.
Fabio Capello
has already
declared his
intention to
shuffle the
pack after
Saturdays
energy-sap-
ping win over Spain. Despite the
world champions enjoying the major-
ity of possession, Joe Hart was hard-
ly tested and is likely to retain his
place in goal. John Terry and Gary
Cahill, who impressed in Bulgaria last
month, will take over in central
defence in place of two of Saturdays
star performers Joleon Lescott and
Phil Jagielka. It would take a huge
dip in form for Ashley Cole to be
usurped by Leighton Baines ahead of
next summer, but on the other flank
Kyle Walker (above) must harbour
realistic hopes of dislodging Capellos
preferred choice at right-back Glen
Johnson. In midfield Frank Lampard
played less than an hour against
Spain and could retain his place,
while Capello will be interested to
see whether Gareth Barry can repro-
duce the sort of all action display
which won Scott Parker so many
plaudits at the weekend. Both Theo
Walcott and Stewart Downing were
starved of possession against Spain,
but the onus will be on them to pro-
vide crosses for target man Bobby
Zamora to feed on in his first appear-
ance since August 2010.
TEAM NEWS | HOW
ENGLAND COULD LINE UP
REPUBLIC of Ireland manager
Giovanni Trapattoni has warned his
players not to take qualification for
their first major tournament in a
decade for granted.
Ireland take a commanding 4-0
lead into the second leg of their play-
off against Estonia tonight in Dublin,
with a place at Euro 2012 seemingly
assured.
But Trapattoni said: I have said to
the team to be careful. It will not be
an easy game. It is another 90 min-
utes for our opponents. They lost
some pride and it is important that
we play with the same seriousness.
Estonias improbable task is made
all the harder by the absence of a trio
of suspended players: goalkeeper
Sergei Pareiko and defenders Andrei
Stepanov and Raio Piiroja.
Trapattoni will replace injured full-
back Stephen Kelly with John OShea,
while striker Kevin Doyle is available
again after serving a ban. Winger
Damien Duff picked up a rib injury in
Tallinn but trained yesterday.
Irelands players stand to share a
3.4m bonus if they clinch a place at
next summers finals, although cap-
tain Richard Dunne insists the money
is no incentive.
We all make enough money at our
clubs and playing for Ireland is an
honour, its not about money, he
said. Footballers want to play in tour-
naments and this is a really big tour-
nament. To go and represent Ireland
in it is going to be something that
money cant buy.
FOOTBALL

Trapattoni warns Ireland to


guard against wounded Estonia
MEMORABLE MEETINGS | ENGLAND V SWEDEN
Sweden 21 England, Jun 1992
England looked on course to gain the
victory they needed to qualify for the
semi-finals of Euro 92 when David Platt
volleyed Graham Taylors side into an
early lead. But roared on by a passion-
ate home crowd Sweden responded
after the break with goals from Jan
Eriksson and Thomas Brolin, before
Taylor infamously brought on Alan
Smith in place of Gary Lineker, who
would never play for England again.
Sweden 21 England, Sep 1998
Qualification for the European champi-
onships got off to the best possible
start when Alan Shearer fired Glenn
Hoddles side ahead in the first minute.
But a side lacking David Beckham
suspended following his World Cup red
card against Argentina a few months
earlier were unable to hold on, and
goals from Andreas Andersson and
Johan Mjallby secured another come-
back win for the Swedes.
England 22 Sweden, Jun 2006
Under the guidance of a Swede, Sven-
Goran Eriksson, England looked set to
end their long-standing hoodoo when
Joe Coles superb dipping volley and a
Steven Gerrard header put the Three
Lions into a 2-1 lead with five minutes
of their World Cup group stage match
remaining. But a series of horrendous
defensive errors allowed Henrik
Larsson to plunder an equaliser in the
90th minute.
HART
WALKER CAHILL TERRY BAINES
LAMPARD RODWELL BARRY
WALCOTT ZAMORA DOWNING
TIGER LOOKS LIKE HES
BACK TO HIS BEST
SAM TORRANCE
COLUMN: PAGE: 37

You might also like