THE MOST HUMBLE

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THE phone hacking scandal moved
ever closer to Downing Street last
night, following a string of damaging
revelations that put the spotlight on
David Camerons Number 10 opera-
tion.
The Conservative Party revealed
that phone hacking suspect Neil
Wallis informally advised Andy
Coulson, Camerons former commu-
nications supremo, in 2009 during
the run up to the general election.
Wallis, a former executive at the
News of the World, also advised the
Metropolitan Police between 2009
and 2010. Two of Britains most sen-
ior policemen Met chief Sir Paul
Stephenson and assistant commis-
sioner John Yates have already quit
over their links to Wallis.
Sources at Conservative HQ, which
has been investigating the links
between Coulson and Wallis for a
number of days, said they were as
sure as they could be that the advice
was offered on a pro-bono basis. They
insisted the advice had nothing to do
with phone hacking and expect their
investigation to show the advice con-
cerned an ordinary, routine matter.
Labour party sources accused the
Tories of sitting on the revelations for
several days, before rushing them
out while the focus was on the
Murdochs high-profile appearance
at the media select committee.
Meanwhile, it was revealed that
one of Camerons most senior advis-
ers blocked Scotland Yard from brief-
ing the Prime Minister on the phone
hacking investigation.
Ed Llewellyn, Camerons chief of
staff, wrote in an email to Yates: I
am sure you will understand that we
will want to be able to be entirely
clear, for your sake and ours, that we
have not been in contact with you
about this subject.
Downing Street released the
emails after Stephenson told a com-
mittee of MPs that a Number 10 aide
has prevented Scotland Yard from
briefing Cameron on hacking
because they feared it would com-
promise him. Yates later identified
the aide as Llewellyn.
Llewellyn has already been
accused of failing to inform the
Prime Minister that Coulson had
links to a private investigator, who
was then facing charges for conspira-
cy to murder.
Meanwhile, Cameron will tonight
face questions from the 1922 com-
mittee, an influential group of MPs
from the Tory backbenches, which
is becoming increasingly restless.
BY DAVID CROW
POLITICS

RUPERT Murdoch yesterday

described his appearance before the
media select committee as the most
humble day of my life.
The embattled media baron said he
had no inkling of the hacking scandal
at the heart of his best selling newspa-
per, which now threatens to topple his
entire empire.
He told MPs he was let down by peo-
ple he trusted within his organisation
and never considered resigning over
the affair, adding he is still the right
man to oversee the clean-up opera-
tion at the company.
However, his son James Murdoch
risked pouring further fuel onto the
fire with comments about a report
into the scandal carried out by law
firm Harbottle & Lewis.
He said the report wrongly corrobo-
rated the theory that the scandal was
confined to a rogue reporter and was
largely a matter of the past.
Harbottle responded with a strongly
worded statement, saying it has
requested News Corp release us from
our professional duties of confidential-
ity so that it can respond to any inac-
curate statements or contentions. It
said that with regret News Corp had
declined the request.
During the three-hour grilling,
Rupert Murdoch was happy to be
painted as a distant owner, saying the
News of the World represented less
than one per cent of his business and
admitting he may be out of touch.
He claimed he was unaware of a
string of events at News International,
including out of court settlements to
hacking victims and the blackmail
conviction of a former reporter.
But while some commentators pre-
dicted the Murdochs would crack
under the pressure of intense ques-
tioning, the pair remained calm
throughout. Shares in both BSkyB and
News Corp notched up gains while the
hearing was taking place.
Rupert Murdoch even intimated he
still hopes his son will take over the
media empire one day. MORE: P2-5
BY STEVE DINNEEN
MEDIA

Rupert Murdoch was grilled by

MPs for three hours
Picture: REUTERS
Phone hacking scandal threatens to engulf Number 10
News
2 CITYA.M. 20 JULY 2011
Why hacking row
will cost UK dear
UNFORTUNATELY for Britain, our
establishment is now so deeply
engulfed in the debilitating media-
political phone hacking crisis that the
country has become rudderless at the
most dangerous time for the global
economy since the collapse of Lehman
Brothers. In times of global financial
crises, proper, clear-headed leadership
from the top is essential. That we are
not getting any from a dangerously
distracted government is the biggest
story of them all.
The situation is getting worse, not
better. The police are deeply rattled
and have their eyes off the ball; jour-
nalists are obsessed with the implo-
sion in their industry and are failing
to devote enough attention to other
matters; the same is true of much of
the public; politicians are talking
about nothing else; there is now loose
speculation that the Prime Minister
himself may be forced to step down or
call a general election (as absurd as
this may seem); the chancellor has
been badly weakened by the fact that
he was the biggest supporter of
appointing the ex-News of the World
editor Andy Coulson to be the PMs
director of communications. The situ-
ation is out-of-control; the forces that
have been unleashed are so powerful
and so unpredictable that nobody can
possibly know where this will end.
Yesterdays grilling of the Murdochs
was a strange anti-climax; but the
spotlight is now increasingly turning
on the government and its advisers
(though Labours very close links to
News International over the years are
also becoming clearer).
EDITORS LETTER
ALLISTER HEATH
JAMES Murdochs performance at
the select committee may have
bought him precious time with the
board of BSkyB.
He has resisted pressure to step
down as chairman of the broadcast-
er, with sources close to the Sky
board telling City A.M. they would
closely monitor his damage limita-
tion skills. A major slip-up would
almost certainly have prompted a
request for his resignation.
But shares in Sky rose almost three
per cent yesterday to 734p up from
a low of 669p in the wake of the col-
lapsed News Corp bid.
Murdoch impressed his critics
with his display, which combined an
in-depth knowledge of the issues
with the requisite amount of contri-
tion. However, his long-term future
at the company still hangs in the bal-
ance.
News Corp investors also appeared
to view the hearing positively, with
its shares jumping more than 5.5 per
cent. Losses incurred as the crisis
blew over the Atlantic to the US
knocked an eye-watering $5bn from
its market cap, ramping up pressure
on its embattled boss.
However, Murdoch quickly
scotched rumours circulating before
the hearing that he would step down
as chief executive.
His problems are far from over
though. The California Public
Employees Retirement System
(CalPERS), a major News Corp
investor, has hit out at the firms
share structure, which gives the
Murdoch family voting rights of
around 40 per cent, despite holding
just 12 per cent of its stock. It has
called for an overhaul of the system,
which gives Murdochs B shares vot-
ing rights. The move comes amid
growing anger in the US over the
allegations levelled at News Corp.
The firms independent directors
are also seeking legal advice from US
law firm Debevoise & Plimpton to
advise them over the newly formed
Management and Standards
Committee.
Murdoch buys time
as Sky shares jump
The evidence so far is that the opin-
ion polls have barely moved the pub-
lic hates and despises journalists more
than ever, but that is the only real
change. Healthy scepticism of the
establishment is an excellent quality
in a vigilant public but extreme
hatred and suspicion of everybody in
a position of influence, power or
authority is destructive in a liberal
democracy.
The real sadness is that all other
debate and especially anything to do
with the economy has stopped in
Britain, at almost the worst possible
time. Let us hope that national securi-
ty issues are being looked after proper-
ly, despite the turmoil at the
Metropolitan Police, which is tasked
with dealing with them. What is clear-
ly not being looked after properly is
Britains economic and geopolitical
interests. The Eurozone is at a cross-
roads; the EU is undergoing an exis-
tential crisis that is set to shape
politics and economics on the conti-
nent for decades to come.
Astonishingly, yields on two-year
Greek government bonds hit 39.02 per
cent yesterday; a crisis is imminent
unless there is a speedy resolution of
some kind.
The British government ought to be
doing all in its power to promote the
UKs economic interests, to protect
this country from the fallout from the
debt crisis and at least try to nudge
the EU in a better direction. Most
importantly of all, it ought to be using
this crisis to make the case for a much
looser relationship between the UK
and the EU. The British public is
deeply eurosceptic, yet this govern-
ment is failing to capitalise on this to
try and negotiate a better deal for the
UK and disengage itself from swathes
of job-killing, growth-destroying EU
policies. Its an unforgivable wasted
opportunity to reposition Britain as a
global, trading economy, freed from
archaic and burdensome ties to fail-
ing post-1945 regional bureaucracies.
On top of blowing a once in a gener-
ation chance of shifting the UKs rela-
tionship with Europe, George
Osbornes political problems mean
that he is clearly not thinking enough
about the economy. He has a dual role
as Chancellor and senior political
strategist for the government; yet it
has clearly become impossible for him
to do both jobs properly. The economy
is going through a soft patch, the
deficit remains high yet I doubt that
it is these vital issues, or the sovereign
debt crisis, that are keeping Osborne
awake at night, especially after the
way he was knifed by Rebekah Brooks
yesterday (she repeatedly highlighted
his role in Coulsons hiring). Osborne
and his advisers ought to be working
day and night on contingency plans in
case the Eurozone collapses or the US
defaults, not worrying about ex-
tabloid journalists. We need a plan for
supply-side led growth in the UK, not
a plan to contain the damage to the
government from phone-hacking.
Even more depressingly, if it were to
become apparent that the govern-
ment could actually fall before any
cuts to overall public spending have
actually happened the markets
would panic. The only reason institu-
tions are still willing to lend so much
so cheaply to the UK government is
that they broadly trust its austerity
plans; if these were suddenly swept
away, everything would change in an
instant. These are truly dangerous
times.
allister.heath@cityam.com
Follow me on Twitter: @allisterheath
4th Floor, 33 Queen Street, London, EC4R 1BR
Tel: 020 7015 1200 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 Craig Gaymer
Pictures Alice Hepple
Commercial
Sales Director Jeremy Slattery
Commercial Director Harry Owen
Head of Distribution Nick Owen
Editorial Statement
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self-regulation overseen by the Press Complaints
Commission. The PCC takes complaints about the
editorial content of publications under the Editors
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BY STEVE DINNEEN
MEDIA

James Murdoch leaving Westminster yesterday after a grilling by MPs Pictures: Micha Theiner/City AM, REUTERS
ANALYSIS l News Corp.
$ 16.6
16.0
16.2
14.6
15.2
15.4
15.8
16.4
10:00 12:00 14:00 16:00
16.25
19 Jul
ANALYSIS l BSkyB
p
10:00 12:00 14:00 16:00 08:00
735
730
725
720
715
734
19 Jul
RUPERT Murdoch yesterday blamed
hysteria for his decision to drop a
takeover bid for satellite broadcaster
BSkyB.
In comments that underlined his
anger at having to drop New Corps
offer for the 61 per cent of Sky it does
not already own, the media mogul
suggested his competitors and detrac-
tors had capitalised on the public
mood, forcing him to retreat.
He said: A lot of people had differ-
ent agendas I think in trying to build
this hysteria. All our competitors in
this country formally announced a
consortium to try to stop us and they
caught us with dirty hands and they
got the story around.
He added: I think a mood devel-
oped which made it really impractical
to go ahead.
Murdoch was forced to drop the bid
earlier this month. Although he could
return with another offer within six
months, company sources indicate he
is unlikely to make a repeat bid for sev-
eral years at least.
News Corp still faces the prospect of
having to sell down its 39 per cent
stake in BSkyB, which it could be
forced to if media watchdog Ofcom
decides that it is not a fit or proper
owner in light of the phone hacking
allegations.
Hysteria made
me drop Sky
bid: Murdoch
News
3 CITYA.M. 20 JULY 2011
Wendy Deng slaps a man after he tries to attack Rupert Murdoch
EVERYBODY was waiting for the killer
blow at the media select committee
hearing yesterday and it came, just
not in the form anyone was expecting.
Rupert Murdochs 42-year-old wife
Wendi Deng leapt up and threw a
stinging slap at a protester who man-
aged to smuggle a makeshift foam-pie
through security and throw it in
Murdochs face.
Deng became an instant sensation
after she was filmed leaping to the
defence of her husband, her feet leav-
ing the floor as she landed the audi-
ble slap on the top of the protesters
head.
She was heard laughing in the
aftermath, shouting I got him, I got
him.
James Murdoch made a half-heart-
ed attempt to protect his father before
police dragged the man outside and
cleared the room.
The hearing was suspended for 10
minutes after the attack, which came
during the final round questions
from Tory MP Louise Mensch. It
resumed with no press or observers,
with chairman John Whittingdale
apologising profusely to Rupert
Murdoch, whose shaving-foam
smeared jacket had been discarded.
The protester was later identified as
Jonathan May-Bowles, a comedian
with links to the UK Uncut protest
group. May-Bowles, who calls himself
Johnny Marbles, told reporters as he
was led away in cuffs: As Mr Murdoch
himself said, Im afraid I cannot com-
ment on an ongoing police investiga-
tion.
The select committee has pledged
to review its security measures in
light of the incident, which it says it is
treating very seriously. Members said
they are concerned he was able to
smuggle a can of shaving foam
through the tight security at the
event. UK Uncut, which organises
protests against individuals and com-
panies they believe avoid paying tax,
denied it was involved.
As the committee closed, Tom
Watson told Murdoch: Your wife has
a very good left hook.
Media mogul
attacked by
a protester
BY STEVE DINNEEN
MEDIA

Sir Paul Stephenson (left) and John Yates, both formerly of the Met, yesterday
BY DAVID CROW
MEDIA

News
5 CITYA.M. 20 JULY 2011
CHANCELLOR George Osborne was
behind the hiring of a former News
of the World editor as an adviser to
David Cameron, it was claimed yes-
terday.
Testifying before MPs, former News
International chief executive
Rebekah Brooks swiftly shifted the
focus from the News of the World
onto the government.
Asked whether she had told
Cameron to hire Andy Coulson as his
director of communications, she said:
The allegation is I told the Prime
Minister to hire Andy Coulson. The
idea came from George Osborne.
It is the first time it has been put
on record that Osborne personally
headhunted Coulson.
Brooks also denied that she owns a
horse or any land jointly with
Cameron.
And asked how she could have not
known that hacking was behind
some of the scoops that NoTW was
getting during her editorship, she
said: A news room is based on trust.
Brooks: Coulson
was hired due
to Osborne
POLITICS

Murdoch survives damp

afternoon in bear-pit
t may have been two Australian-
Americans being grilled in the
media select committee bear-pit
yesterday but it was book-ended
by protests of a very British nature.
Wielders of anti-Murdoch plac-
ards were ejected before proceed-
ings had even begun and the real
fireworks came when a spectator
slapped a foam-pie in Uncle Ruperts
face, only to take a beating from his
wife Wendi. It was a shame, then,
that the events in-between were a
little damp. It started on a positive
note, with Rupert interrupting his
sons nervous opening gambit with
a firm and probably well
rehearsed hand on his arm. This
is the most humble day of my life,
he growled, instantly writing
todays headlines. It was a rare flash
of the brilliant newspaperman
Murdoch undoubtedly is.
But the octogenarians early per-
formance was more notable for its
drawn-out pauses than its arresting
retorts. James took the opposite
tack, babbling at length, rarely
using one word when he could
squeeze in a dozen. Despite the grav-
ity of the occasion, it was difficult
not to drift off. So it was a shame
that Tom Watson, a heavyweight in
all senses of the word, seemed off
his game. The Labour MP is usually
worth the entrance fee alone but
looked nervous; subdued in the
moment he was expected to shine.
His probing questions troubled
the Murdochs but werent delivered
with their usual flourish, and he
failed to land a real blow.
Things got worse when a dire run
of questions were delivered by Jim
Sheridan, who was hopelessly out of
his depth. This allowed James to
find his groove and his confidence
soared. He seemed to physically
grow as the hearing progressed.
Rupert too snapped out of his tor-
por, with snappy monosyllabic
answers reminiscent of his better
days. Tough questions near the end
from MP Philip Davies were too lit-
tle too late this was successful
damage limitation.
SELECT COMMITTEE SKETCH
STEVE DINNEEN
Murdoch is careful to make sure that he apologises for phone hack-
ing, but he appears to be suggesting that some politicians might have
an ulterior motive in trying to bring his empire down. Murdoch argues that
a competitive press leads to greater transparency, which is bad news for
some in the establishment. If he were forced to sell or close his newspapers,
the press would be less plural and scandals would go uncovered. Ultimately,
he is arguing he is good for Britain.

BEHIND THE LINES | WHAT RUPERT MURDOCH WAS TRYING TO SAY

It doesn't get away from our apologies or our blame
for anything but this country does greatly benefit from having a competitive press and therefore having a
very transparent society. That is sometimes very incon-
venient to people but I think we are better and
stronger for it.

The Prime Minister to whom I was closest was

Gordon Brown. I thought he had good values. Our
wives struck up a great friendship. Our children played
together on many occasions. I am sorry that he has fall-
en out with me, but I hope we will repair our
relationship.

This country has given me, our companies and our

employees many opportunities. I am grateful for
them. I hope our contribution to Britain will one day
also be recognised. Above all I hope we will... restore
the nation's trust in our company and in all
British journalism.

I wish we had managed to see and fully solve these

problems earlier. When two men were sent to prison
in 2007, I thought this matter had been settled. The
police ended their investigations and I was told that News
International conducted an internal review.

Although it is true that Rupert Murdoch and Gordon Brown shared

some values such as a Presbyterian work ethic the media mogul
is discrediting the former Prime Minister by paying him a compli-
ment. By suggesting he was close to Brown, he draws attention to the
Labour MPs hypocrisy. In an outburst last week, Brown styled himself as a
long-time opponent of the media mogul, claiming he was a multiple victim
of phone hacking and that he tried to launch an inquiry.

Murdoch is re-enforcing his assertion that he was unaware of any

wrongdoing. He is placing the blame at the hands of both the police
and the staff who carried out the much-criticised internal review
into the phone hacking scandal, almost all of whom have now left the com-
pany. By placing these between him and the scandal, he hopes to emerge
from the affair with the company and his position at the helm intact.
He still has a long way to go before he can be sure of this, though.

While he is saying the country has done a lot for him, he wants peo-
ple to remember that he has also done a lot for the country, and espe-
cially the media industry, which would have received significantly less
investment without him. That the politicians who have courted him over the
last decade have now turned on him will be particularly galling. He cleverly
talks about restoring trust in all British journalism, suggesting the target
will eventually move onto rival newspapers.

How long will it take for News Corp to

recover from the phone hacking scandal?
This week were giving members of
our readers panel the chance to
have their say on how damaging the
News of the World phone hacking
scandal will ultimately prove for its
parent company News Corp.
We want to know how long it will
take the brand to recover, if it recov-
ers at all.
We are also asking if News Corp
which currently owns 39 per cent of
the shares in BSkyB is a fit and
proper owner of a UK television
broadcaster.
And we want to know if Murdoch
will close or sell off more of his out-
lets, following the closure of the
News of the World.
Meanwhile, with wall-to-wall cov-
erage of the phone hacking scandal,
has the media been giving too much
attention to the issue? Or maybe too
little?
To answer the above questions
and others like them apply to join
the panel by completing the form at
www.cityam.com/panel
PoliticsHome.com PoliticsHome.com
In association with
PoliticsHome.com
Apply to join today at
www.cityam.com/panel
In partnership
with
EUROPE must consider further integra-
tion including a region-wide bank reso-
lution regime and harmonised taxes to
avoid disastrous economic fallout from
the euro crisis, the IMF has said.
The advice was released in an IMF
policy report as it emerged, days
before a crisis summit on Thursday,
that Eurozone leaders are considering
a harmonised bank levy across the
region as a backdoor way of getting
banks to share in the cost of a new
Greek bailout.
It is not clear how the tax would be
targeted towards banks most exposed
to Athens debt, but it would aim to
raise 10bn a year for three years as
part of a 110bn new rescue package.
Alternatively, it could be used to
threaten banks into offering a more
generous burden-sharing deal.
If imposed, it could be a precursor to
a much more intense fiscal integra-
tion that markets and international
bodies now see as the only alternative
to a disorderly default and new finan-
cial crisis.
The IMF said: The links between
sovereigns and firms located in their
jurisdiction will need to be loosened.
It suggests creating European instead
of national support schemes for bank
restructuring and that working
towards the introduction of a com-
mon corporate tax for large firms
would help.
Analysts have said that data pub-
lished by the EUs bank stress tests
have shown that massive cross-bor-
der exposures are now integral to the
Eurozone economy.
However, any push for further inte-
gration risks a popular backlash, with
the EUs paymaster nations already
enraged at having to pay for the debts
of others.
UKIPs Nigel Farage said: The IMF
has become little more than the over-
seas arm of the ECB It is simple the
attempts by the political elite have
failed. Let economic sense do its job.
BY JULIET SAMUEL
EUROZONE

CHINAS tax revenues in the first half

of the year surged 29.6 per cent from
a year earlier to five trillion yuan
(470bn), underscoring the govern-
ments ability to deal with any fallout
from piles of local government debt.
Tax revenue growth slowed from a
32.4 per cent rise in the first quarter
of this year. Revenue from corporate
income tax surged 38.3 per cent in
the first half while personal income
tax climbed 35.4 per cent and con-
sumption tax rose 20.2 per cent, the
Ministry of Finance said.
Receipts from customs duties rose
32.1 per cent and those from property
tax rose 24.4 per cent, the ministry
said. The ministry attributed the
strong tax revenues to solid economic
growth, rising corporate earnings as
well as higher prices that boosted
receipts.
Soaring Chinese tax revenues in
2011 pare worries over local debt
ASIAN ECONOMY

News
6 CITYA.M. 20 JUNE 2011
Italian magistrates are investigating Prime Minister Silvio Berlusconi over claims he put
pressure on state broadcaster RAI to suppress a programme critical of the government. He
has been accused of trying to take a talk show off the airwaves in 2009, putting further
strain on authorities as they struggle to prove Italys stability in the European markets.
IMF: EU must
harmonise its
taxes for euro
CITY VIEWS: HOW WORRIED ARE YOU ABOUT THE CRISIS IN THE EUROZONE?
Interviews by Caitlin Morrison
Im pretty worried about it because it will affect
the UK economy even further. There will be a
greater need to politically centralise funding. The
euro cant be allowed to fail it will have a
major effect on jobs here and it will make it
even harder to compete with the Chinese.
Id be slightly worried about how it will
affect us. If they go back to different cur-
rencies, how is it going to affect imports
and exports in the UK? I would also be
worried about how it will affect interest
rates.
I dont want Britain to have to bail out another country, I dont agree with it in principle. Its not fair that we
should have to bear the brunt of other countries mistakes, but I understand that if we dont and they fail, we
will feel the consequences.
FELICITY PEEL | HAMMOND PARTNERS
HAMISH ROBERTS | AON ANDY KING | NICOLL CURTIN
ITALY PROBES BERLUSCONI OVER TV SHOW
POLITICIANS in Washington DC
appeared to be edging closer to a
resolution on raising the US debt
ceiling yesterday, after President
Barack Obama described a biparti-
san proposal by six senators as
broadly consistent with his own
approach.
The Gang of Six senators
tabled a plan to cut $3.7 trillion
(2.3 trillion) from the US govern-
ments deficits over 10 years, includ-
ing an immediate $500bn deficit
reduction.
The resolution would involve
both tax hikes and spending cuts
closing tax breaks but also aiming
to reduce expenditure on Medicare
and Medicaid.
Obama praised the proposal as a
very significant step in the
crunch talks between Democrats
and Republicans, yet both sides are
also readying themselves for
Republican Mitch McConnells so-
called fallback plan.
McConnells plan would autho-
rise the President to raise the debt
limit in three increments,
totalling $2.5 trillion -- with-
out any mandatory spend-
ing cuts -- provided
Obamas fellow Democrats
go along with it.
Credit rating agency
Moodys yesterday
warned that while
such an eventuali-
ty would avoid an
immediate down-
grade of
Americas AAA
rating, it
could still
lead to a
downgrade
of the coun-
try's ratings
in the next
year or so.
The numbers that are being dis-
cussed in terms of any possible
deficit reduction coming out of
this plan dont seem to be very
large, said Moodys analyst Steven
Hess. Therefore, this plan might
result in a negative outlook on the
rating.
Republicans yesterday pushed
their cut, cap and balance pro-
posal, which calls for immediate
spending cuts and cap-
ping the level of federal
spending at a per cent-
age of the economy --
18 per cent by 2021.
Even if the House of
Representatives pass-
es though the
plan, it has
effectively no
chance of
being voted
through the
Senate.
Obama upbeat over
bipartisan debt plan
BY JULIAN HARRIS
US ECONOMY

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News
7 CITYA.M. 20 JULY 2011
WHAT THE OTHER PAPERS SAY THIS MORNING
ANGLO IRISH'S US PORTFOLIO DRAWS
INTEREST
Several banks, including Deutsche
Bank AG, Goldman Sachs Group, J.P.
Morgan Chase and Wells Fargo, are
weighing bids for parts of national-
ized Irish lender Anglo Irish Bank
Corps US real-estate portfolio, accord-
ing to people familiar with the mat-
ter.
NOKIA EXPECTED TO GIVE DOWNBEAT
FORECAST
When Nokia reports its second-quar-
ter results on tomorrow, all eyes will
be on the ailing handset maker's
guidance for the second half of this
year. Expectations are low. Struggling
to compete with Apple and smart-
phones that run on Googles Android
operating system, Nokia in February
decided to dump its Symbian system.
F1 SUPREMO ECCLESTONE ACCUSED OF
BRIBERY BY GERMAN PROSECUTORS
German prosecutors have publicly
alleged that Bernie Ecclestone and a
trust belonging to the Formula One
supremos family paid almost $44m
(39m) in bribes to a German banker.
In return, Mr Ecclestone received
$41.4m in commissions from
BayernLB, the German bank, while a
family trust company was paid $25m,
German prosecutors allege.
OSMOND EYES NEW HORIZON
Hugh Osmond, the serial entrepre-
neur, has started preparations to
float a new acquisition vehicle as
soon as October that would aim to
raise up to 500m, according to peo-
ple close to the plans. The venture
would be a successor to the Horizon
acquisition vehicle floated last year.
EUROZONE DEBT CRISIS COULD PROVE
VERY COSTLY FOR THE WORLD, WARNS
IMF
The International Monetary Fund
(IMF) has urged eurozone leaders to
take immediate action over the
region's debt crisis, warning it could
prove very costly for the world.
Europes policymakers must press on
with deeper economic integration to
stay the course, the global lender
said.
BRITISH TOURIST SHOT DEAD IN
VENEZUELA
A British man has been shot dead
and his brother injured during a rob-
bery while they were on holiday in
Venezuela. Thomas Ossel, from
Bedfordshire, was fatally shot in the
jaw while his brother Jack was
wounded but survived.
News
8 CITYA.M. 20 JULY 2011
GOLDMAN Sachs yesterday rattled
investors with earnings that fell
far short of analysts estimates
because of sharp declines in trad-
ing revenue.
Goldman, once Wall Streets
largest bond trading house,
reported its sixth consecutive
quarterly decline in that business,
making bond trading smaller
than its traditionally low-margin
equities trading business.
Its fixed income, currency and
commodities (FICC) trading rev-
enue fell 53 per cent from a year
earlier to $1.6bn (991m), far
worse than analysts had expected.
Compared to the first quarter,
FICC revenue was down 63 per
cent.
Overall, Goldman earned
$1.05bn, or $1.85 per share, in the
second quarter, far below the
$2.27 per share analysts had fore-
cast. Adjusted for special charges,
Goldman earned $2.75 per share a
year earlier.
Weak client activity and a lack
of clear market direction have
weighed on large Wall Street
banks trading businesses for the
past year. But unlike JP Morgan
Chase and Citigroup, which post-
ed better-than-expected trading
results last week, Goldman does
not have a commercial banking
operation to fall back on.
During the second quarter,
the operating environment was
more difficult given global macro-
economic concerns, Goldman
chief executive Lloyd Blankfein
said.In addition, certain of our
businesses had disappointing
results as we reduced our market
risk.
On the bright side, Goldman's
performance in investment bank-
ing, where it advises clients on
mergers or debt and equity
issuance, was strong, although
not strong enough to make up for
the trading declines. Investment
banking revenues overall rose 54
per cent to $1.45bn.
Goldman shares fell 2.7 per
cent shortly after the results.
Goldman hit
by slump in
bond division
BY HARRY BANKS
BANKING

ANALYSIS l Goldman Sachs

$
14Jul 15Jul 18Jul 19Jul 13Jul
133
131
129
127
128.49
19Jul
Its a tough time to be running a toll booth
M
arkets are right to be
worried about
Americas biggest
lenders.
While investors are sitting on
their hands waiting for crisis
after crisis to blow over, theres
little chance of returning to the
days when banks like Goldman
could rake in billions simply by
presiding over monstrous trad-
ing flows.
The same malady has hit
other investment banks: when
everyone is too scared to get in
their cars and go anywhere, its
hard to make money running a
toll road, especially when regu-
lators are demanding fancy new
upgrades to your toll booths.
Little wonder that banks are
frantically shedding staff and
shifting their business models
towards more even revenue
sources like asset management.
But not fast enough:
Goldman reported pay cost-cut-
ting of 16 per cent over the quar-
ter. Revenues from its trading
division plunged 47 per cent.
Bank of America/Merrill
Lynch also saw revenues drop in
its flow business, while the top
line elsewhere mostly held up
and its advisory unit delivered
its best performance since the
merger.
But BoAML has bigger prob-
lems namely a hangover of
legal headaches that show lit-
tle sign of abating, fuelling
speculation that the bank will
need to raise more capital
before long. Thats a far cry from
the grand talk of a dividend
boost late last year.
In short, you either have to be
a singular optimist or a great
believer in the genius of banks
senior management to keep
pouring money into these
injured flow monsters.
BOTTOMLINE
Analysis by Juliet Samuel
CEO Lloyd Blankfein said the economy had made trading tricky
$1.45bn
investment bank
revenues
$1.05bn
earnings during the
second quarter
53%
year-on-year fall in
FICC revenues
News
9 CITYA.M. 20 JULY 2011
BANK of America yesterday reported
its biggest-ever quarterly loss
$8.8bn (5.46bn) as low interest
rates squeezed lending margins at
the largest US bank.
The loss was widely expected after
the bank said in June that it settled
with mortgage bond investors for
$8.5bn and was taking more than
$14bn of other home loan-related
charges in the quarter.
But the banks results, including
its shrinking interest income,
underscore the difficulties chief
executive Brian Moynihan faces
even if the bank moves past its mort-
gage problems. The banks shares
fell 1.2 per cent in early trading.
The banks credit losses declined
during the quarter and some busi-
nesses improved their performance,
but the economy is not likely to
improve much in the short term,
Moynihan said on a conference call.
Given Bank of Americas mort-
gage and interest income difficul-
ties, it will not likely be able to boost
its dividend for some time, analysts
said.
The banks loan book shrank,
unlike many of its rivals, and the
longer-term rates at which banks
can lend are falling relative to the
short-term rates at which banks bor-
row. At Bank of America, these fac-
tors translated to a 13 per cent
decline in interest income and a siz-
able 0.17 percentage point decline in
lending margins from quarter one.
On a conference call, chief finan-
cial officer Bruce Thompson said
the bank was pretty close to the
trough for net interest income, if it
was not there already.
Overall, revenue tumbled 54 per-
cent to $13.5bn because of a provi-
sion taken as part of the mortgage
settlement. Excluding that, revenue
was $26.5bn.
Wells Fargo & Co last night post-
ed 30 per cent increase in second
quarter profits, beating analyst
expectations as it cut costs and
dipped into funds previously set
aside to cover losses.
BofA falls to
worst loss in
its history
BY HARRY BANKS
BANKING

BofA boss Brian Moynihan is trying to turn the bank around

BONUSES in financial services
were unchanged in the year to
March 2011, totalling 14bn
the same as the previous 12
month period.
The level of bonus awards
paid out across the whole of
the British economy was also
unchanged from the previous
year at 35bn, the Office for
National Statistics (ONS) said.
The average bonus in
finance and insurance was
12,500 in the last period
measured. City bonuses were
36 per cent higher in 2006-07
and 2007-08, measuring 19bn
in the financial sector.
Bonuses in the City
level out at 14bn
EMPLOYMENT

ANALYSIS l Bank of America Corp

$
14Jul 15Jul 18Jul 19Jul 13Jul
10.40
10.00
9.60
9.44
19Jul
$8.8bn
quarterly loss
$22.5bn
charges linked to
home loans
54%
year-on-year fall in
overall revenues
BANK regulators started consulting
yesterday on two proposals to make
the worlds biggest banks bear a
new compulsory capital surcharge
and draw up living wills to make
them safer.
The Basel Committee has pro-
posed that globally systemically
important banks (G-SIBs) set aside
equity worth one to 2.5 per cent of
their risk-weighted assets, depend-
ing on their size and complexity, to
make them safer.
About 28 such banks would set
aside the surcharge at first, the
committee said. It will consult
until 26 August.
The Financial Stability Board also
began consulting on its proposals
to wind up struggling systemically
important banks.
These cover living wills and bail-
in plans, and will consult until 2
September.
Basel warns that top 28 banks
must pay its capital surcharge
BANKING

News
10 CITYA.M. 20 JULY 2011
LAND Securities, the UKs largest real
estate investment trust by value, said
vacancy rates fell in the past quarter
as it confirmed it was stepping up its
development activity as stronger
retailers look to take new floor space.
The firm said yesterday it had cut
its vacancy rate to 3.9 per cent at the
end of June from 4.2 per cent at the
end of March. It achieved 9.5m of
lettings, showing an active demand
for space amongst retailers.
Francis Salway, the groups chief
executive said: The outlook for
development in London remains
attractive and, despite the mixed
messages in the retail sector, our leas-
ing activity demonstrates that the
stronger retailers are looking to take
new space.
Income from disposals helped the
company offset a fall in revenues
after selling some of its develop-
ments to reinvest in new schemes.
Total sales in the quarter, includ-
ing its Sainsburys supermarket site
in Wandsworth - totalled 177.1m at
7.9 per cent above March 2011.
What we have achieved in lettings
and sales underpins our confidence
in the plans that we set for the busi-
ness, Salway told City A.M.
Land Securities confirmed it has a
275m pipeline of opportunities in
out of town areas to meet demand
from retailers, especially supermar-
kets, but said it remained cautious
over where it chose to buy new assets.
We are taking care where we do
developments outside London to
make sure that it is supported by sig-
nificant level of pre-lettings before
we start, Salway said.
Its units in administration
increased to 0.9 per cent from 0.6 per
cent in 31 March 2011 due to Focus
DIY and Habitat collapsing into
administration.
Adjusted net debt fell to 3.99bn
compared with 4.18bn at 31 March.
DRUGS firm Johnson & Johnson
reported better than expected earn-
ings yesterday due to an upswing for
its prescription medicines.
Stabilising sales of over-the-count-
er medicines also aided the results,
after several years of recalls due to
quality control lapses.
Results were also greatly helped by
the weaker dollar, which boosts the
value of sales in overseas markets,
and sharply lower taxes.
The diversified healthcare compa-
ny said it had net earnings in the sec-
ond quarter of $2.78bn (1.72bn)
compared with $3.45bn in the year-
earlier period.
Excluding special items, J&J earned
$1.28 per share -- topping the average
forecast of $1.24 per share among
analysts.
Company sales jumped 8.3 per cent
to $16.6bn, surpassing Wall Streets
expectations of $16.23bn although
sales would have risen only 2.6 per
cent if not for the weaker dollar.
Despite the profit and sales beats in
the quarter, J&J stuck to its full-year
profit view of $4.90 to $5 per share.
That would reflect growth of up to
five per cent from last years results.
Global sales of prescription drugs
jumped 12.2 per cent to $6.23bn.
Sales of consumer products, includ-
ing over-the-counter drugs, rose four
per cent to $3.79bn.
Shares in the US firm rose as much
as 11 per cent after the results
announcement.
Johnson & Johnson cheers turnaround
in its prescription medication business
US DRINKS giant Coca-Cola yesterday
reported a slowdown in sales in North
America, but still posted better-than-
expected earnings on strength in
emerging markets such as China
and Russia.
Coke reported net income of
$2.8bn (1.12bn), or $1.20 per
share for the quarter to 1 July
up from $2.37bn a year earlier.
Excluding one-time items,
earnings were $1.17 per share,
topping analysts average estimate by
one cent.
Revenue jumped 47 per cent to
$12.74bn, slightly above expectations,
fuelled by last years purchase of
North American bottling opera-
tions, price increases and a six
per cent benefit from foreign
exchange rates.
Volatility in commodity mar-
kets has also led to increased costs
for packaging, sweeteners and
fruit, the maker of Sprite and
Powerade said.
Coca-Cola surprises on
emerging market sales
CONSUMER

ONLINE group Yahoos net revenue

declined slightly in the second quar-
ter, it said last night, on weakness in
its display advertising business.
Shares of the internet search com-
pany dropped around two per cent
in after-hours trading.
Yahoo reported net income of
$237m (147m), or 18 cents a share,
compared with $213m, or 15 cents a
share, in the year-earlier quarter.
The company forecasts third-quar-
ter net revenue -- which excludes the
fees that Yahoo pays to partner web-
sites -- of between $1.05bn and
$1.1bn.
Yahoo is a leading provider of
online display ads in the US, but the
company is facing increasing compe-
tition from social networking service
Facebook and continuing pressure
from search leader Google.
Yahoo said net revenue in the sec-
ond quarter was roughly $1.1bn,
compared with $1.13bn in the year-
earlier period.
Yahoo revenues slide as
display advertising wanes
TECHNOLOGY

APPLES quarterly revenue again

crushed Wall Street expectations yes-
terday, driven by blockbuster sales of
its hot iPhones and iPads.
Its flagship products all exceeded
forecasts. It sold 20.34m iPhones dur-
ing the quarter along with 9.25m
iPads and 3.95m Mac computers.
Gross margin for the quarter came to
41.7 per cent.
The Cupertino, California compa-
ny said its fiscal third-quarter rev-
enue rose to $28.57bn (17.7bn),
trouncing the average analyst esti-
mate of $24.99bn.
Shares of the worlds most
valuable technology company
leapt 6.1 per cent to about $400
after a brief halt after-hours.
The stellar results came as con-
cern over iPad 2 supply con-
straints eased. The
company is entering the
second half of 2011 on a
roll. In coming months,
Apple is expected to
launch a new model of the
iPhone, which is likely to
give the tech giant
another revenue boost.
The health of chief
executive Steve Jobs (pictured) again
came to the forefront after reports
that several Apple board members
had discussed a successor to the
Silicon Valley icon, and talked it
over with at least one head of a
high-profile tech company.
Succession planning at
the worlds most valuable
technology company has
been a hot topic since Jobs
announced he was taking
medical leave for
unknown reasons, with
many not expecting him to
return to lead the company he
founded in 1976.
Apple crushes profit forecast
BY HARRY BANKS
TECHNOLOGY

Vacancy rate
falls at Land
Securities
BY KASMIRA JEFFORD
PROPERTY

BY HARRY BANKS
PHARMACEUTICALS

Land Sec chief Francis Salway cheers a strong update Pic: Micha Theiner/ CITY A.M
ANALYSIS l Land Securities
p
14Jul 15Jul 18Jul 19Jul 13Jul
885
875
865
855
845
864.50
19 Jul
ANALYST VIEWS: IS PERFORMANCE AT LAND
SECURITIES ON TRACK? Interviews by Kasmira Jefford

BART GYSENS | MORGAN STANLEY

The group made good progress on developments with a variety of ini-
tiatives...The groups loan-to-value ratio has fallen further from 39 per cent as at
March to 37.5 per cent as at June 2011. Admittedly, Land Secs is taking increas-
ingly more development risk rather than financial risk.

DANIEL HORWOOD | LIBERUM CAPITAL

A progressive interim management statement, it presents incremental
progress on known capex / asset management schemes. But modest upgrade
potential and a fairly full share rating increase sensitivity to macro uncertainties
and eventual interest rate rises.

CARL GOUGH | MATRIX GROUP

Land Securities continues to demonstrate that its asset management
portfolio is probably the strongest of the large five property majors born out by
the outperformance of its share price amongst those peers. Yet this IMS does not
really contain anything majorly new.

NETWORK equipment maker

Riverbed Technology last night
announced the purchase of private-
ly-owned UK software group Zeus
for $110m (68m) in cash plus up to
$30m in performance-linked pay-
ments.
Zeus, based in Cambridge, makes
programmes to manage traffic on
cloud computing systems. The deal
is expected to be break-even for
Riverbed earnings in 2011 and earn-
ings-accretive in 2012, the firm said
in a statement.
According to industry analysts,
the virtual ADC market is expected
to grow about four times faster than
the traditional ADC market over the
next four years, said Jerry Kennelly,
president and CEO at Riverbed.
Zeus is well positioned within this
market as customers look for ADC
solutions for public and private
clouds that truly integrate into their
application stack.
Riverbed also announced weaker
than expected second-quarter rev-
enue as it saw softness in Europe,
sending its shares down 22 per cent
in after-market trade.
The firm reported a second-quar-
ter net profit of $11.3m, or seven
cents a share, compared with $6.6m,
or four cents a share, in the year ago
quarter. Adjusted earnings were 21
cents a share, in line with market
estimates. Revenue rose 35 per cent
to $170.3m, but missed analysts
expectations of $172.9m.
Riverbed snaps
up British cloud
computing firm
TECHNOLOGY

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At a glance, clients have access to:
RICE KINGS
SHARWOODS
BID GOES
OFF THE BOIL
THE RETAIL industry has been on tenter-
hooks over the last month to see whether
rice tycoon Moni Varma, the chairman of
Veetee Food Group, would succeed in
expanding his processed foods empire by
buying Sharwoods from Premier Foods.
However, The Capitalist can reveal that
Varmas audacious bid for the sauces
manufacturer is no longer likely to go
ahead, after Premier Foods decided the
brand was just too valuable to sell.
Sharwoods has definitely gone off the
boil, Varma told The Capitalist. [The bid] is
not at the forefront at the moment.
But while Sharwoods is off the shopping
list, Varma still has a 50m expansion pot
to dispose of. Carbohydrates have been
perfected; now he wants to snap up mak-
ers of sauces, lentils, proteins anything
to provide a complete meal solution.
Varma refused to name the companies
Veetee Group is looking at it is rather
sensitive at the moment but confirmed
that he has put an extra 10m into his rice
cooking facilities in Kent and 2.5m into
new bagging and packaging lines.
With a move into ready-cooked pasta set
for November, it is full steam ahead for
Veetee Group the only cloud is Varmas
Battersea, the adjoining London Heliport,
and Daviss hangar at London Biggin Hill
Airport, where he services and maintains
his large fleet of helicopters
OLYMPIC CHALLENGE
THE YEAR ahead promises to be a busy
one for Truett Tate, who has been appoint-
ed as vice chairman, client coverage, at
Lloyds Banking Group.
Tate (above) will combine client calling
with leading the banks corporate social
responsibility agenda which means he
will attend IMF meetings and become the
go-to lead for the Olympics next year,
while continuing his involvement
with the African finance chari-
ty Opportunity International
and with Business in the
Community.
Tate has been negotiating
the new role with chief
executive Antnio Horta-
Osrio for some time, mak-
ing good use of his fluent
Portuguese. When most
people gear down in
August, Ill be gearing
up, he said.
ongoing legal battle with ArcelorMittal
steel magnate Lakshmi Mittal, after the for-
mer friends fell out over a Nigerian oil deal.
I am saddened I didnt get enough
recognition and there is an amount of
money outstanding, but once Lakshmi
gets his head around [the situation], I am
hopeful we can settle before we get to
court, commented Varma on the busi-
ness matter. There is no personal war,
he added. I see no reason why this
should drag on until it gets to court.
CIVIL AVIATION
WHERE now for Andrew Davis, the fallen
hotels tycoon, as he surveys the wreckage
of his Von Essen country house empire?
Gone are the jewels in his portfolio
Amberley Castle in Chichester, Sharrow
Bay in Cumbria and the
iconic Cliveden in
Berkshire after creditors
Barclays and Lloyds sent in
administrator Ernst & Young
to recoup at least part of
the groups 250m debt.
A salutary tale on the
man who made last
years Sunday Times
Rich List and counts
Michael Winner as a
personal friend.
Davis (pictured right
with Shirley Bassey) isnt
completely finished
though. The Capitalist hears
the assets Ernst & Young
hasnt got its paws on
include the Hotel Verta in
Nothing personal: Moni Varma (left) hopes not to see Lakshmi Mittal in court
Sharwoods is
no longer at
the forefront
of rice tycoon
Moni Varmas
50m plans
to expand
Veetee Food
Group
The Capitalist
12
EDITED BY
HARRIET DENNYS
Got A Story? Email
thecapitalist@cityam.com
Follow The Capitalist
on Twitter: @citycapitalist
CITYA.M. 20 JULY 2011
INVESTMENT management group
Evolution is in advanced discussions
to buy the wealth management arm
of French investment bank BNP
Paribas, it said yesterday, sending
Evos shares up more than eight per
cent.
Evolutions Williams de Bro
wealth management division, which
invests on behalf of private clients, is
looking to acquire BNP Paribas
Private Investment Management to
boost its size and presence.
No offer price was disclosed, but
Williams de Bro has about 6.2bn
assets under management and
Evolution has about 90m cash.
Evolution, which also has a stock-
broker and alternative finance
provider, wants to expand its wealth
management division to reduce its
reliance on volatile trading-related
income streams, which are under
pressure in the current market.
Rivals such as Hargreaves Lansdown
and Brewin Dolphin have profited
from developing their wealth man-
agement divisions, where returns are
high and stable, as trading revenues
have declined across the sector.
Peel Hunt analyst Henry Biddle
said the deal was strategically a good
move as it would further bias group
earnings towards asset management.
SPREADBETTER IG Group yesterday
said volatile markets across Europe
and the success of new smartphone
apps helped it post record profits for
the past year.
Pre-tax profits at the group rose 3.4
per cent to 163m in the year to the
end of June, after adjustment for
items such as the closure of its sport
betting business Extrabet, beating
analyst expectations for 158.5m.
Chief executive Tim Howkins told
City A.M. IGs four smartphone apps
its Android app launched less than a
month ago had opened up new rev-
enues from existing clients, with 14
per cent of client transactions now
made through smartphones.
If youre an active trader you dont
want any downtime, he said. Clients
which use the app as well as a comput-
er are now about twice as valuable as
our usual clients.
He said it was hard not to be
pleased by 54 per cent growth in IGs
German business, while its European
division had also performed well.
IG is targeting international growth
as it has 39 per cent market share in
the UK but less in its other major mar-
kets and it believes it can raise that.
But Howkins said he saw high mar-
ket volatility continuing. There is a
lot of uncertainty in the markets, and
it may be here to stay at this level for
several months, he said.
IGs revenues were up 7.3 per cent
to 320.4m as its client base grew, and
it said trading since the new financial
year was better than in 2010.
It also paid a 4.1m Financial
Services Compensation Scheme levy.
Numis analyst James Hamilton said
once the extra costs were taken into
consideration its underlying profit
growth was 7.4 per cent.
Appy trading
for IG Group
as profits rise
FUND manager Henderson yesterday
said it had doubled its fee income in
the past six months compared with
the first half of 2010, but could not
stem outflows as investors moved
money out of its funds.
Performance fees jumped 120 per
cent and transaction fees were up 45
per cent compared with 2010, push-
ing Hendersons overall first-half prof-
it guidance to 83-87m, ahead of ana-
lyst expectations.
But while Henderson said 91 per
cent of Gartmores assets now
worth 15.5bn - remained in place,
investors pulled a net 438m from
Gartmore funds and a total 2.9bn
from the group as a whole.
Institutional outflows from
Henderson funds made up 2.6bn of
that amount, while its retail funds
attracted only 575m of new capital.
And Henderson warned that fee
income was likely to slow substan-
tially in the second half.
Given lower performance fee
potential in 2H11 the group expects
the level of performance fees generat-
ed in 2H11 to be substantially lower
than 1H11, it said in a statement.
Henderson said its integration of
Gartmore was on track. Its total assets
under management were 74.4bn.
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Henderson fee income cheers
despite more fund outflows
Evolution targets BNP Paribas
private client arm for takeover
BY ALISON LOCK
FINANCIAL SERVICES

FINANCIAL SERVICES

BY ALISON LOCK
FUND MANAGEMENT

News
13 CITYA.M. 20 JULY 2011
Henderson chief
executive Andrew
Formica oversaw
the takeover of
Gartmore
Picture: Micha
Theiner/CITY A.M.
ANALYSIS l IG Group
p
14Jul 15Jul 18Jul 19Jul 13Jul
440
430
420
410
433.05
19 Jul
DISCOUNT supermarkets have
grown their market shares as cash-
strapped customers seek out bar-
gains.
Aldi and Lidl saw strong market
share growth in the 12 weeks to 10
July, according to figures from the
Kantar Worldpanel. Aldi achieved a
20.2 per cent rise in UK market
share to 3.5 per cent.
Lidls share rose 15.6 per cent to
2.6 per cent. Waitrose was the next
biggest climber with a market
share rise of nine per cent to 4.3
per cent. Britains grocery market
remains polarised, with hard dis-
counters Aldi and Lidl and upmar-
ket chain Waitrose growing much
faster than mainstream rivals like
Tesco, Asda and Sainsburys.
Kantar Worldpanel director
Martin Whittingham said: The
increasing polarisation of the gro-
cery market looks set to stay as con-
sumers turn to the discounters to
cut their budgets while others con-
tinue to spend in Waitrose.
Tesco, Asda and Sainsburys are
still the three biggest supermar-
kets. Morrisons recorded the
biggest growth of the period out of
the big four supermarkets, rising
5.6 per cent to give it a share of 11.9
per cent of the market.
Aldi and Lidl grow
their market share
BY JOHN DUNNE
RETAIL

News
14 CITYA.M. 20 JULY 2011
HERMES LIFTS FORECAST AS SALES RISE
LUXURY group Hermes now expects revenue growth of 12 to 14 per cent in 2011, up
from a previous range of eight to 10 per cent, after what it described as a better-than-
expected performance in the second quarter. Sales in the three months to 30 June
jumped 22 per cent to 668.4m (587m), Hermes said.
GREENE King is to buy the Capital Pub
Company, beating rival Fuller, Smith
and Turner to take over the business.
The Capital Pub Company, which
has 34 pubs, has accepted the 70m
cash offer which trumped Fullers
54m takeover approach last month.
The chain, which specialises in
revamping pubs in affluent London
areas, rejected Fullers bid as too low.
Greene King said it wants to expand
its presence in what it described as the
attractive and growing premium eat-
ing and drinking out market in
London.
If the deal is accepted by Capitals
shareholders, the combined group
will have 250 pubs in Greater London.
Greene King is offering investors
235p per share.
Capitals shares were trading at
155.5p before the offers were made.
Fullers rejected offer was for 200p.
Capital chief executive Clive Watson
said the deal is bitter-sweet for him,
as he would have liked to keep the
company independent for a while
longer.
He added: I am happy the business
has gone to a good home.
Once Fullers put us in play I
realised independence was not an
option. Watson will pocket several
millions from the deal but said he
would go on to build another business
rather than retire.
Capitals pubs include The Bishop in
Dulwich and The Ladbroke Arms on
Ladbroke Road.
Greene King boss Rooney Anand
said: These are fantastic pubs....
London is very important to our strat-
egy.
Greene King beats
Fullers to seal deal
for Capital Pub Co
BY JOHN DUNNE
M&A

The team from the bank that sealed

Greene Kings deal for Capital Pubs
was led from London by chairman of
UK corporate broking James Agnew.
He is joined on the deal by Steven
Varlakhov, a consumer M&A banker,
and Andrew Smith in corporate
broking. Agnew, a veteran banker with
almost 20 years experience in corpo-
rate broking, currently sits on the
Takeover Panel and has had a prolific
City career. He currently sits on the
London Stock Exchange Primary
Markets Group. Most recently he led a
team which advised Amec on its
173m takeover bid for MACTEC.
He has also advised Rupert Murdochs
News Corp on its approach for the
shares the company does not already
own in British satellite broadcaster
BSkyB, which has now hit the buffers
in the wake of the phone hacking scan-
dal which has engulfed the Murdoch
empire. He also advised Kraft on its bid
for Cadbury. Agnew joined Deutsche in
2002, having previously been head of
corporate broking at Merrill Lynch
from 1995. Lazard also advised on the
Greene King deal.
ADVISERS: DEUTSCHE
JAMES
AGNEW
DEUTSCHE BANK
DAIRY CREST GETS A BOOST DESPITE MARKET PRESSURES
Dairy Crest yester-
day reported an
increase in sales of
its five main
brands in what it
called an increas-
ingly tough trad-
ing environment.
Total sales of Dairy
Crests five main
brands, Cathedral
City, Country Life
butter, Clover and
St Hubert Omega 3
spreads, and
yoghurt drink Frijj,
rose by five per
cent year-on-year in
the first quarter to
30 June.
MARKET SHARE (PER CENT)
Store 12 Wks to 10 July 2011 12 Wks to 10 July 2010 % change in sales
Tesco 30.6 30.7 4.3
Asda 17.0 17.5 1.9
Sainsbury 16.1 16.1 4.4
Morrison 11.9 11.6 5.6
Waitrose 4.3 4.1 9.0
Aldi 3.5 3.0 20.2
Lidl 2.6 2.3 15.6
Iceland 1.9 1.9 7.5
BAA said it is considering judicial
review after the Competition
Commission ruled yesterday that the
airport operator must sell Stansted
and Glasgow or Edinburgh airport.
In its final report, the commission
said that the sales process for Londons
third-largest airport Stansted would
start in three months time, and
would be followed by the sale of one of
the Scottish airports.
Colin Matthews, BAAs chief execu-
tive, said he was dismayed by the
Competition Commissions final deci-
sion and said it was looking at its legal
options with regards to the ruling.
The Competition Commission has
not recognised that the world and
BAA have changed. This decision
would damage our company which is
investing strongly in UK jobs and
growth, he said.
The group, controlled by Spains
Ferrovial, also argued that being
forced to sell in a difficult market
could destroy shareholder value.
The report ends a two year battle
between BAA and the CC, who in 2009
ruled that BAA exerted a dominant
hold on UK airports and told it to sell
Gatwick, Stansted and one of its
Scottish airports.
The CC has concluded that the sale
of the airports is fully justified and
that passengers and airlines would
still benefit from greater competition
with the airports under separate own-
ership, the CC said in a statement.
BAA mulls a
fresh lawsuit
in sell-off spat
BAA chief Colin Matthews said he was dismayed by the decision Picture: REUTERS
BY KASMIRA JEFFORD
AVIATION

News
CITYA.M. 20 JULY 2011 15
ANALYSIS l Ferrovial SA

14Jul 15Jul 18Jul 19Jul 13Jul

8.70
8.50
8.30
8.10
8.25
19 Jul
TIME LINE | BAAS BATTLES
June 2006: The Office of Fair Trading
(OFT) announced it would review the UK
airports market.
August 2006: BAA delists from the stock
market and shortly after faces calls for its
breakup from British Airways and Ryanair.
April 2007: The OFT refers BAA to the
Competition Commission (CC) to investi-
gate the supply of airport services within
the UK.
Sept 2007: The CC publishes it initial find-
ings calling for a fundamental restructure
of BAA following its poor standards of
service.
April 2008: Colin Matthews takes the
reins as chief executive, succeeding
Stephen Nelson.
March 2009: The CC orders BAA to sell
off Stansted airports and either Edinburgh
or Glasgow, in a move against the groups
monopoly.
December 2009: BAA completes the
1.5bn sale of Gatwick airport to Global
Infrastructure Partners.
October 2010: BAA appeals to the
Supreme Court after judges reinstated an
order forcing the company to break-up its
monopoly.
March 2011: The Supreme Court refuses
BAAs permission to appeal further.
July 2011: Britain's Competition
Commission reiterated in its final report
that BAA must sell two of its airports.
Law firm Herbert Smith is acting as
legal adviser to BAA, with partners
Nusrat Zar from the litigation divi-
sion and Stephen Wisking from the
EU competition group leading the
case.
Zar joined Herbert Smith 16 years
ago as a trainee lawyer, and was
made partner in the firms litigation
division four years ago.
She advises on a range of public
and administrative law matters
including judicial review, the
European Convention on Human
Rights, and regulatory and discipli-
nary proceedings.
Zar has acted in a matter concern-
ing reform of the House of Lords, a
motion put forward by Lord Mayhew
of Twysden. She has also acted for
Ofgem defending a judicial review
challenge to NGCs use of system
charges brought by Scottish Power
as well as acting for companies fac-
ing investigations by the Serious
Fraud Office and other regulators.
MEET THE ADVISERS
NUSRAT ZAR
HERBERT SMITH
JOHNSONMatthey, the worlds largest
supplier of catalytic converters, said
its first-half performance should be
significantly ahead, after a 19 per cent
rise in first-quarter profit.
The British chemicals company said
underlying profit before tax rose to
98m in the three months to the end
of June, on the back of a 12 per cent
rise in sales, benefiting from higher
demand for products including truck
catalysts.
Johnson Mattheys key environmen-
tal technologies division saw a 14 per
cent rise in sales in the quarter and a
similar improvement in operating
profit, as lower profit from its light
duty catalyst business -- hit by disrup-
tion caused by the Japanese earth-
quake and tsunami and by rising rare
earth prices -- was more than offset
by strong demand for heavy duty
diesel catalysts.
Demand for the groups products
and services remains robust. The out-
look for the second quarter of 2011-12
is good and as a result the groups per-
formance in the first half of the year is
expected to be significantly ahead of
the same period in 2010-11, chairman
John Banham told shareholders at
Johnson Mattheys AGM yesterday.
We currently anticipate that our
good start to 2011-12 will be main-
tained throughout the year.
If you take into account the macro-
economic uncertainty which has
[prompted] some other chemicals
companies to be very conservative in
their outlook, I think this is positive,
analyst Pieter Zwinkels at RBS said.
The second half is still uncertain
but they are not negative, which indi-
cates consensus is realistic for now,
and that should be read as a positive.
Shares in Johnson Matthey rose
four per cent yesterday.
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BY HARRY BANKS
CHEMICALS

News
16 CITYA.M. 20 JULY 2011
PETRA DIAMONDS SALES SPARKLE
AFRICA-focused miner Petra Diamonds yesterday said its full-year revenue rose 24 per
cent, as higher rough diamond prices and demand in Asia offset falling production.
Revenues were $221m (137m) in the year to the end of June and would have jumped 55
per cent including the $35m sale of the Cullinan Heritage diamond (pictured). The gem,
included in the firms 2009-10 figures, set a record price for a rough diamond.
UKs Johnson
Matthey sees
higher profits
Where to find the Citys brands of tomorrow
B
randIndex measures perceptions
of the brands that we know of
and buy today, but this week I
wanted to think about the
potential brands of tomorrow. On
Monday I had the great pleasure of
meeting young entrepreneurs at the
launch of StartUp Summer, a scheme
to encourage innovation and entrepre-
neurship among students organised
by YouGov with University College
London and Imperial College and sup-
ported by Downing Street.
The chart from the
Bloomberg/YouGov Household
Economic Activity Tracker shows that
unemployment worries remain high
among the British population, with
our job security index between -15 and
-21 throughout 2011, having never
been higher than -10 in 2009 or 2010;
but if the quality of entrepreneurs that
I met on Monday is anything to go by
then the longer term outlook for our
economy is a bright one. Students are
becoming more prepared to follow a
business path rather than the tradi-
tional professional services one, and
Londons Silicon Roundabout (where
YouGov is headquartered) may get a lit-
tle of Silicon Valleys enterprise spirit.
During the scheme five teams will
have six weeks to turn their great ideas
into business plans to take to market.
They will attend workshops, master-
classes from successful entrepreneurs
such as Martha Lane-Fox and Luke
Johnson and have access to market
research and a small budget plus a
cash investment for the winning team.
The ideas they will be working on
include a sustainable fashion label, a
smartphone app for dermatology
patients and an advertising company
making use of the mouse cursor.
I am confident that the ideas will
make considerable progress over the
next six weeks, and that the business
leaders of tomorrow are taking their
first steps to success. Stephan
Shakespeare is the chief executive of YouGov
BRANDINDEX
STEPHAN SHAKESPEARE
ANALYSIS l Net Job Security
%
Feb09 Jul 09 Dec 09 May10 Jul 10 Dec 10 Jun11 Feb11
0
-5
-10
-15
-20
-25
Monday 19th September 2011
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CISCO Systems plans to cut 15 per
cent of its staff and sell a set-top box
factory as part of a plan to cut annual
expenses by $1bn (620m) as the net-
work equipment maker tries to revive
its fortunes.
The company said that it will cut
11,500 jobs, compared with the sever-
al thousand that analysts had predict-
ed.
Cisco had 73,408 employees as of
the end of the last quarter, a spokes-
woman said. Cisco will transfer 5,000
to Taiwans Hon Hai Precision
Industry, which will buy the set-top
box plant in Mexico.
HOME appliances giant Electrolux
yesterday warned that weak demand
in the US and Europe combined with
rising raw materials costs would hurt
second-half earnings, underscoring
harsh conditions for consumer com-
panies.
Electrolux, the worlds second
largest maker of appliances like
fridges and cookers, posted worse
than expected second-quarter results
alongside its gloomy forecast and saw
its shares drop as much as 13 per cent
to two-year lows yesterday.
That followed a surprise loss on
Monday for Philips, Europes largest
maker of consumer electronics. The
Electrolux warning also boded ill for
its larger rival, Whirlpool, the appli-
ances world number one, which
reports tomorrow.
It is a weak economic macro envi-
ronment and appliance demand is
directly connected to consumer confi-
dence and discretionary income,
Electrolux chief executive Keith
McLoughlin said, referring to the US
market, where he said demand fell 10
per cent in the quarter.
Important European markets like
Spain and Italy were also sharply
lower, hit by austerity and debt wor-
ries, he added.
Electrolux, buffeted by the debt cri-
sis in southern Europe and a fragile
US economy, reported core earnings
of 745m crowns (70.3m) versus 911m
crowns forecast in a poll of analysts
and 1.5bn crowns a year ago.
In a statement, the company said it
did not expect earnings in the second
half to reach those of the second half
of 2010
As well as weak demand, Electrolux
has suffered higher costs from soar-
ing metals and plastics prices. It stuck
to a forecast for raw materials cost
rises of 2bn crowns this year.
Electrolux hit
as consumers
feel the pinch
headline sponsor champagne reception sponsor
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SWISS drugmaker Novartis expects to
withstand competition from cheaper
copies of its drugs after it posted fore-
cast-beating second-quarter sales
helped by its newest products.
Sales rose 27 per cent, or 19 per
cent in constant currencies, to
$14.9bn (9.24bn), ahead of a poll
average of $14.7bn, while sales vol-
ume at the key pharma unit rose
eight per cent.
The group said its new products
and its diversified strategy mean it is
well placed to deal with the fact that
several of its blockbuster drugs will
lose patent protection soon.
Novartis beats
sales forecasts
Cisco cuts 15pc
of its workforce
BY HARRY BANKS
CONSUMER

TECHNOLOGY

PHARMACEUTICAL

News
18 CITYA.M. 20 JULY 2011
ANALYSIS l Electrolux AB
p
15Jul 18Jul 19Jul
150
140
130
123.10
19 Jul
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
Barclays Wealth
The wealth manager has hired
Christian Berchem as managing direc-
tor, head of high net worth for UK &
Ireland private bank, based in London.
Berchem will join in September from
JP Morgan, where he is co-head of
European sales.
Berwin Leighton Paisner
Property lawyer Andrew Sanders will
join the real estate practice at Berwin
Leighton Paisner as a partner. Sanders,
who joins from Hogan Lovells, recently
worked on the 67-acre redevelopment
of Kings Cross.
Deloitte
The business advisory firm has
appointed Chris Harrop, formerly a
project director at Horizon Nuclear
Power, to lead 100 nuclear experts as
head of its nuclear capital programmes
team. Deloitte has also hired Steve
Wright, formerly head of PwCs securi-
ty governance, risk and compliance
practice, as a director in its enterprise
risk services practice.
Vanguard Asset Management
Janine Menasakanian, formerly of
Met Life, has been appointed as
strategic account manager in the
firms retail business.
Eversheds
The law firm has hired ex-Macfarlanes
partner and head of the corporate real
estate group, Clive Lampard, as a con-
sultant in its London real estate group.
Clive, who qualified at Slaughter and
May in 1985, specialises in advising
clients on restructuring and occupier
strategy as well as acquisitions and
disposals.
The Law Society
Allen & Overy consultant and former
antitrust partner John Wotton has
been inaugurated as the new Law
Society president. Wotton has been an
Allen & Overy partner since 1984 and
led the international public procure-
ment group until 2010.
Freshfields Bruckhaus Deringer
Freshfields has appointed corporate partner
Julian Long as head of its London corporate
practice for a three-year term. Long, who suc-
ceeds Mark Rawlinson, newly elected as London
managing partner, is an M&A specialist who
also runs the law firms consumer and health-
care sector group. He recently advised on
Petrochinas venture with Ineos and the merger
of FEMSAs brewing business with Heineken.
| PROMOTION
a luxury night camping
among Londons
famous landmarks
City A.M. has teamed up with Londons newest
shopping and leisure destination, One New Change,
and The Princes Trust to offer one lucky reader and
friend a once-in-a-lifetime exclusive camping
experience under the stars in the heart of the City.
The City Sleepover will take place on Saturday 6th
August 2011. Sixty lucky campers will be treated
to an evening of live music, Champagne and food
before settling down for the night on the largest
public roof terrace in Europe, next to the iconic St
Pauls Cathedral.
VIP GUESTS WILL BE TREATED TO:
A mouth-watering BBQ from Madison, One New
Changes newest rooftop eatery
Exclusive MOET Ice Imperial Champagne
A Dermalogica pop-up refresher tent with the
option of a hand massage or face refresh
A fully-equipped tent from Ellis Brigham and a
survival goody bag to take away the following
morning
With entertainment courtesy of renowned Jazz
musician, Yolanda Brown, a bedtime reading from
the author of The Art of Camping, Matthew De
Abatiua, and an exclusive performance from The
Flying Karamazov Brothers, fresh from their West
End show, it is sure to be an unforgettable night!
Whats more, giant telescopes will be set up on the
roof terrace to allow campers to pick out the
hundreds of historic landmarks dotted across the
Citys night skyline.
On Sunday morning, One New Changes new
Champagne bar, Searcys, will treat campers to a
Champagne breakfast. After their meal guests can
either head home feeling relaxed and refreshed,
and with a goody bag filled with survival essentials,
or they can stay to make the most of the shopping,
fine wine and food on offer at One New Change, all
of which is on offer seven-days-a-week.
This unique experience has been organised by One
New Change to raise money for their official
charity partner, The Princes Trust, with tent sales
and donations on the night going directly to the
charity. All equipment will be provided for the
guests including tents, bedding and other
amenities; guest simply need to bring their
personal essentials.
For further information please visit:
www.onenewchange.com/city-sleepover
For your chance to win, simply answer the
following question:
Who designed St Pauls
Cathedral?
A. Jean Nouvel
B. Sir Christopher Wren
C. Sir Norman Foster
Please email your answer and contact number to:
lucky@cityam.com
DATE
Saturday
6th August 2011
TIME
From 7pm onwards
VENUE
One New Change
Roof Terrace
Terms & Conditions: The prize is a tent for two at The City Sleepover on Saturday 6th August 2011. Tickets are not for resale and no cash alternative is offered. The promoter is One New
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Strong results
bolster Wall
Street stocks
News
CITYA.M. 20 JULY 2011 19
BEST OF THE BROKERS
To appear in Best of the Brokers email your research to notes@cityam.com
ANALYSIS l Tesco
425
415
405
395
9May 27Jun 16Jun 6Jul
p
392.05
19 Jul
TESCO
JP Morgan Cazenove rates Tesco over-
weight with a 577p target price as it
believes its growth story is defensive,
multi-pronged, highly visible and sustain-
able. The broker sees its share price as
depressed, and believes Tescos diversifica-
tion and low reliance on UK consumers as
increasingly important as the UK economic
climate worsens, giving it a better chance
of growth than its peers.
ANALYSIS l Pace
170
150
130
110
9May 27Jun 16Jun 6Jul
p
109.40
19 Jul
PACE
Canaccord Genuity rates Pace a hold with
a 100p target price ahead of its first-half
results over concerns that its business
model is unattractive as it services cus-
tomers with strong bargaining power,
needs a lot of working capital and faces
intense competition, which pressurises its
margins and cash generation. It sees Pace
as weakened by product delays in the first
half and sees earnings risk for the full-year.
ANALYSIS l Marstons
112
108
104
100
96
9May 27Jun 16Jun 6Jul
p
102.08
19 Jul
MARSTONS
Numis rates the pub group a buy with a
130p target price as it expects its third-
quarter results to show 2.5 per cent like-
for-like sales growth in its managed pubs
despite a tough market. Poorer weather
than last year should have slowed managed
estate drink sales, but food, which is now
65 per cent of managed revenue, should be
resilient. It should also benefit from
improved margins in its new build venues.
A
rally by recently beaten-down
banks and commodity issues
hauled Britains top share index
higher yesterday, although
many traders doubted whether the
gains could hold.
Dead cats are proving pretty elas-
tic ... It is most likely that any hedge
funds shorting stocks over the [banks]
stress tests are back in and buying to
cover their shorts. But like a hug that
does not last very long, this rally lacks
conviction, said Louise Cooper, mar-
kets analyst at BGC Partners.
At the close, the FTSE 100 index
was 37.18 points or 0.7 per cent high-
er at 5,789.99, recovering almost half
of the sharp falls recorded in the pre-
vious session.
The UK blue chip index had shed
five per cent over the previous eight
trading days as worries over the
potential for debt default among
some Eurozone countries and threats
to the USs top credit rating weighed
on sentiment.
Miners bounced, tracking firmer
metal and oil prices, and helped by
positive comment from BofA Merrill
Lynch, which argued that gold equity
plays looked particularly cheap given
the sharp rise in the precious metal.
Johnson Matthey, the worlds
largest supplier of catalytic convert-
ers, was a top blue chip gainer, up
four per cent as it said its first-half
performance would likely be signifi-
cantly improved.
Banks rallied, with the sector hav-
ing hit two-year lows on Monday as
analysts questioned the credibility of
last weeks European bank stress
tests, and with ongoing concerns over
lenders exposure to the region's debt
problems.
Lloyds Banking Group was the top
performer, up 4.3 per cent, having
been among the top fallers on
Monday. RBS added 0.4 per cent.
On the downside, British Land was
the top blue chip faller, down 1.1 per
cent as Goldman Sachs cut its rating.
Banks bounce aids
uptick in the FTSE
THELONDON
REPORT
p
9May 27May 17Jun 7Jul
6,100
5,700
5,800
5,900
6,000
ANALYSIS l FTSE
5,789.99
19 Jul
W
ALL Street rebounded yester-
day, bolstered by strong cor-
porate results and renewed
hope for an agreement in
Washington that would avert a
default on US debt.
The Dow Jones industrial average
was up 210.10 points, or 1.70 per cent,
at 12,595.26. The Standard & Poor's
500 Index was up 21.38 points, or 1.64
per cent, at 1,326.82. The Nasdaq
Composite Index was up 57.84 points,
or 2.09 per cent, at 2,822.95.
Strong quarterly numbers from
technology bellwether IBMand bever-
age giant Coca-Cola boosted technolo-
gy and consumer shares in the first
heavy week of second-quarter results.
IBM gained nearly five per cent, lead-
ing the Dows gainers.
Markets surged after President
Obama suggested progress was being
made toward a deficit reduction deal.
The White House and Congress need
to sign a deal that includes an
increase in the federal debt ceiling by
2 August or the US could default on
its debts.
THEUS
REPORT
W
HILE the European debt crisis
rumbles on, there is also a storm
brewing across the Atlantic. As
European finance ministers
squabble, the GOP and Democrats are
locked in a battle of their own. This row has
fuelled uncertainty from investors as to
Americas ability to address its enormous
debt burden. But if they are to avoid miss-
ing a coupon payment on their debt, the
two parties are going to have to put parti-
sanship to one side and set out a credible
plan.
Trevor Greetham, director of asset alloca-
tion at Fidelity International, foresees an
interim peace treaty that will be more style
than substance: We expect the political
parties in the US to reach a deal that will
allow the federal debt ceiling to increase
and will allow enough by way of token
spending cuts to allow both parties to save
some face. Greetham adds: We expect the
markets to greet this news positively even
though, with unemployment close to 10
per cent, we expect little real substance in
the agreement as regards the short-term
fiscal stance.
MUNI-DEFAULT
While Greek bond yields make it seem like
they would probably get a better deal on
their debt from a payday loan shark, US
municipalities are also struggling to keep
up with their monthly repayments.
Reports from Jefferson County, Alabama
indicate that it is close to defaulting on its
$3.2bn of bonds taken out for infrastruc-
ture repairs, which would send them down
the same path as the Californian Vallejo
municipality, which filed for bankruptcy
two years ago. And while Jefferson County
The size of American
bonds at risk from
default swamp the
Eurozone liabilities,
writes Craig Drake
The cloud of debt that
is hanging over the US
C
REDIT concerns continue to preoccupy FX
traders, and as officials on both sides of the
Atlantic struggle to put forth a credible fiscal
policy to appease the markets, the Swiss franc
remains the currency of choice for those seeking the
safety of sound money. The Swissie has become the
pox-on-both-your-houses trade as investors seek to
avoid the risk of holding either the dollar or the euro.
Little wonder that at the start of this weeks
trade the Swiss franc hit fresh record highs against
both the euro and the greenback, before bargain
hunters swooped in. With the economic calendar
relatively barren this week, the focus will remain on
politics, as EU finance ministers hold an emergency
meeting on Greece this Thursday, and US lawmakers
try to find a compromise on the debt ceiling by
Friday.
European officials already appear to be back-
tracking from their categorical refusal to accept any
type of default by Greece, with Austrias central
bank governor Ewald Nowotny stating on Tuesday
that, there are some proposals that deal with a very
short-lived selective default situation that would not
really have major negative consequences. His posi-
tion differs starkly from European Central Bank
(ECB) chief Jean-Claude Trichets comments earlier
this month. It reflects the ECBs growing acceptance
of the fact that Greece is unable to service its debts
as they stand now and will inevitably require some
sort of restructuring in the near future.
If the European summit this Thursday produces a
meaningful overhaul of the stability fund and some
possible restructuring of Greek debts, the short cov-
ering rally in risk FX could persist into the weekend,
especially if the US reaches a compromise on the
debt ceiling issue. Having walked to the precipice of
a credit collapse, fiscal officials on both sides of the
Atlantic are working feverishly this week to calm
the markets. Yet the structural problems persist, and
the Swissie will likely set fresh highs as the year pro-
gresses. For now dollar-Swissie at SFr0.8000 is the
critical line for risk. If the pair breaks below that
barrier, it will signal more panic in the markets.
SWISS FRANC
IS PROVIDING
RISK RELIEF
BORIS SCHLOSSBERG
DIRECTOR OF CURRENCY RESEARCH, GFT
gftuk.com | FOREX
free phone 0800 358 0864
GFT Global Markets UK Ltd. is authorised and
regulated by the Financial Services Authority.
CD03UK.162.070811
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is one of a number of cities and counties on
the Do Not Resuscitate list, ratings agency
Moodys has indicated that if the US gov-
ernment loses its AAA rating, then at least
7,000 municipal debt issuances would also
automatically have their ratings downgrad-
ed. Moodys has signalled that, should
Congress fail to reach an agreement on the
governments $14.3 trillion debt ceiling,
then the AAA US sovereign debt rating will
be at risk. This cut would affect $130bn
worth of municipal debt, including mort-
gage-backed securities held by Fannie Mae.
These problems could be the final nail in
the coffin for the dollars status as a haven
currency, already battered by rounds of
money printing. Though it is difficult to
forecast the outcome of the ugly dog fights
between the dollar-sterling and euro-dollar
pairs, gold will undoubtedly be driven ever
higher as investors seek an alternative to
fiat currency.
Wealth Management | Foreign Exchange
20
A happy ending is unlikely for central bankers Ben Bernanke and Jean-Claude Trichet
FOREX ANALYST PICKS
FOREX STRATEGIST
JOEL KRUGER
My pick: Short Kiwi dollar-dollar
Expertise: Technical analysis
Average time frame of trades: 1 day to 1 week
FOREX STRATEGIST
ILYA SPIVAK
My pick: Stay short euro-dollar
Expertise: Global macro
Average time frame of trades: 1 week to 6 months
Last week I sold euro-dollar at $1.4188 expecting increasingly weak
Eurozone economic data to weigh on ECB rate hike expectations against
a backdrop of lingering worries about debt crisis contagion. Indeed, an
EU leaders summit focusing on Greece this week seems unlikely to help
much, as the spotlight shifts to Spain and Italy. My initial target is at
$1.3968, the 23 May low, and a stop-loss will be activated on a daily
close above the 61.8 per cent Fibonacci retracement barrier at $1.4294.
A fresh short-trade was established earlier in the week with the market
surging to fresh 30-year highs before eventually stalling out just over critical
barriers by $0.8500. From here, it looks as though the market is finally start-
ing to show some signs of exhaustion, and we would look for the formation
of a short-term bearish reversal to open deeper setbacks over the coming
days back towards the $0.8000 handle at a minimum. Position: short at
$0.8485 for $0.8000 objective; stop only on a daily close above $0.8600.
FOREX STRATEGIST
JOHN KICKLIGHTER
My pick: Short Australian dollar-dollar and euro-dollar, long dollar-yen
Expertise: Fundamental analysis with risk management
Average time frame of trades: 1 day to 1 week
My sterling-dollar short from last week hit its first target; but the
remainder of the position was trailed out at break even on a sharp
reversal in risk trends and European currencies. Looking forward
exceptional volatility and a clear lack of direction offers many very
short-term setups, but few lasting opportunities. Ill be patient and
wait for bigger breaks on euro-dollar, dollar-yen and Aussie dollar-
dollar (at $1.40, 79.50 and $1.04 respectively.
S
INCE breaking below
the $80 level in spec-
tacular fashion a few
days ago, dollar-yen
seems to have found some
support around 79. The
break below 80 could
mean a retest of the post
earthquake lows around
76.50. Capital Spreads
quotes a price of 79.00-
79.01.
European government
bond yields are hitting lofty
heights not seen for years,
and it further fuels concerns
about the Eurozone situa-
tion. As traders are still
waiting on a decision from
European leaders regarding
a second bailout for Greece,
the euro has found it tough
to find stability against the
dollar. However, as it seems
an agreement may be
approaching, the euro has
fought back, and has seen
the pair break above an
intraday bearish channel
which may signal further
positivity for the single cur-
rency. Capital Spreads
quotes $1.4185-$1.4186 on
euro-dollar.
Todays Bank of England
minutes are likely to rein-
force the perception that
interest rates are likely to
remain low for quite some
time to come. This dovish
tone has been one of the
main reasons that the
pound has slipped lower,
particularly against the
Swiss franc where it has
been making all time lows.
CMC Markets quotes
SFr1.32079-SFr1.32159 on
sterling-Swiss franc.
Cable has spent the last
few months trading in a rel-
atively tight range of just
500 points or so, but the
impending news on the US
debt ceiling could well pres-
ent the opportunity for a
break-out. It seems incon-
ceivable that the US would
default a move that would
decimate confidence in the
greenback but lifting the
debt ceiling means printing
more cash and the laws of
supply and demand point
towards dollar weakness as
a consequence. IG Index
quotes 1.6115-1.6116 on
sterling-dollar.
Since hitting 16-month
highs of 0.9083 on 1 July,
it has been all downhill for
euro-sterling. After falling
nearly 4 per cent in two
weeks, it spiked lower to
touch lows of 0.8703 on
Monday morning.
Significantly though, a
strong trendline drawn from
June 2010 lows again
proved major support at
those lows and helped pro-
pel it back to 0.8790. Look
for the recovery to continue
and euro-sterling to test
0.890 again soon. Spread
Co quotes 0.8790-
0.8792.
Philip Salter
THE TIPSTER
TREMULOUS YEN COULD BE
ABOUT TO BREAK LOWER
The euro faces an existential threat
that is exposing the weaknesses of
Europes leaders, writes Philip Salter
T
HE Eurozone has been on
the brink of outright crisis
for a while, but events are
overtaking politics, as mar-
kets lose faith in Europes heart.
Kathleen Brooks of Forex.com is
concerned that the tremors in the
periphery are now being felt in the
core, noting: France and Belgium
have seen their spreads versus
German bonds come under pres-
sure in line with the peripheral
nations. Similarly, Philip Poole,
global head of macro and invest-
ment strategy at HSBC, in his latest
New World Insights note states:
Unfortunately, leverage in the
government sector is not a prob-
lem that is limited to the periph-
ery of the Eurozone.
UNDER PRESSURE
Angus Campbell of London Capital
Group thinks if the issue over who
will bear the cost of any haircuts
isnt sorted, the euro will remain
under pressure in the coming
weeks. He says until this is resolved
further upside to the euro looks
limited and volatility will likely
remain high. Louise Cooper of
BGC Partners says markets are
getting impatient. Many are tout-
ing tomorrows crisis meeting as
another judgement day, but
Cooper is highly sceptical that a
one day summit is going to fix this
problem, calling the problem a
crisis by committee.
BRUSSELS WE HAVE A PROBLEM
According to Andrew Morris, man-
aging director of Signature, there
is no easy solution to the Eurozone
crisis. He explains there are 17 dif-
ferent countries, each pursuing
their own agenda, with their own
interests and their own domestic
politics. This is compounded by
disagreements between the intra
governmental institutions. He con-
cludes: Current efforts have failed
because they dont acknowledge
the nub of the problem, which is
one of solvency.
Campbell says over the near-
term, a key resistance level will be
seen at 1.4285 and support at
1.4025 and 1.3950 over the
longer-term. He thinks bulls will
be targeting resistance at 1.4700
and 1.4900. However, being a euro
bull right now might be a symp-
tom of mad cow disease.
Eurozone crisis wont be swept
under the peripheral carpet
21
LON GD ONCE FIX AM...........1602.00 3.75
SILVER LDN FIX AM..................40.34 -0.18
MAPLE LEAF 1 OZ ....................70.00 3.00
LON PLATINUM AM ...............1784.00 19.00
LON PALLADIUM AM...............796.00 11.00
ALUMINIUM CASH .................2444.00 -5.00
COPPER CASH ......................9689.00 83.50
LEAD CASH...........................2728.00 79.00
NICKEL CASH......................23765.00 -290.00
TIN CASH.............................26950.00 -305.00
ZINC CASH ............................2398.00 80.00
BRENT SPOT INDEX................116.39 -0.36
SOYA.....................................1385.50 0.00
COCOA..................................3159.00 0.00
COFFEE...................................248.20 0.00
KRUG.....................................1659.50 -3.00
WHEAT ....................................165.88 4.10
AIR LIQUIDE........................................93.56 -0.04 100.65 80.00
ALLIANZ..............................................89.38 1.55 108.85 79.46
ALSTOM..............................................38.45 0.36 45.32 30.78
ANHEUS-BUSCH INBEV ....................39.38 0.16 46.33 38.32
ARCELORMITTAL ..............................22.30 0.20 28.55 20.76
AXA......................................................13.14 0.26 16.16 10.88
BANCO SANTANDER...........................7.24 0.12 10.23 6.98
BASF SE..............................................67.00 -0.43 70.22 40.74
BAYER.................................................56.32 0.62 59.44 43.27
BBVA.....................................................7.11 0.08 10.71 6.75
BMW ....................................................72.00 0.89 72.74 39.96
BNP PARIBAS.....................................44.90 1.27 59.93 43.42
CARREFOUR ......................................21.59 0.06 36.06 21.33
CREDIT AGRICOLE..............................8.43 0.25 12.92 8.18
CRH PLC .............................................13.95 0.35 17.40 4.72
DAIMLER.............................................52.40 0.90 59.09 37.03
DANONE..............................................50.21 -0.48 53.16 41.00
DEUTSCHE BANK..............................36.46 0.59 51.61 35.66
DEUTSCHE BOERSE .........................53.05 -0.65 62.48 46.33
DEUTSCHE TELEKOM.......................10.35 0.26 11.38 9.50
E.ON.....................................................18.73 0.36 25.54 18.18
ENEL......................................................4.01 0.06 4.86 3.54
ENI .......................................................15.29 0.11 18.66 14.95
FRANCE TELECOM............................13.79 0.18 17.45 13.56
GDF SUEZ ...........................................22.63 0.16 30.05 22.46
GENERALI ASS. .................................12.80 0.22 17.05 12.18
IBERDROLA..........................................5.49 0.04 6.50 4.86
ING GROEP CVA ..................................7.44 0.36 9.50 6.35
INTESA SANPAOLO.............................1.54 0.06 2.53 1.41
KON.PHILIPS ELECTR.......................16.91 -0.29 25.88 15.56
L'OREAL..............................................83.66 0.29 91.24 75.03
LVMH.................................................123.20 0.80 129.95 87.53
MUNICH RE.......................................101.70 2.95 126.00 98.43
NOKIA....................................................3.89 0.09 8.49 3.79
REPSOL YPF.......................................21.30 0.17 24.90 17.21
RWE.....................................................35.99 0.82 56.49 34.77
SAINT-GOBAIN...................................40.34 0.31 47.64 27.81
SANOFI ................................................54.44 0.21 56.82 44.01
SAP......................................................41.10 0.72 46.15 34.13
SCHNEIDER ELECTRIC...................105.10 3.10 123.65 81.40
SIEMENS .............................................93.00 1.31 99.39 70.02
SOCIETE GENERALE.........................34.24 1.44 52.70 32.76
TELECOM ITALIA.................................0.85 0.01 1.16 0.80
TELEFONICA ......................................15.52 0.12 19.69 15.07
TOTAL .................................................38.32 0.24 44.55 36.23
UNIBAIL-RODAMCO SE...................150.75 0.95 162.95 117.34
UNICREDIT............................................1.19 0.05 2.24 1.06
UNILEVER CVA...................................22.52 -0.07 24.11 20.68
VINCI ....................................................40.01 1.07 45.48 33.38
VIVENDI ...............................................17.09 0.34 22.07 16.66
Price Chg High Low
EU SHARES
WORLD INDICES
FTSE 100 . . . . . . . . . . . . . . 5789.99 37.18 0.65
FTSE 250 INDEX . . . . . . . 11592.41 64.63 0.56
FTSE UK ALL SHARE . . . . 3016.33 19.12 0.64
FTSE AIM ALL SH . . . . . . . . 870.03 2.78 0.32
DOWJONES INDUS 30 . . 12587.42 202.26 1.63
S&P 500 . . . . . . . . . . . . . . . 1326.73 21.29 1.63
NASDAQ COMPOSITE . . . 2826.52 61.41 2.22
FTSEUROFIRST 300 . . . . . 1076.88 8.92 0.84
NIKKEI 225 AVERAGE. . . . 9889.72 -84.75 -0.85
DAX 30 PERFORMANCE. . 7192.67 84.75 1.19
CAC 40 . . . . . . . . . . . . . . . . 3694.95 44.24 1.21
SHANGHAI SE INDEX . . . . 2796.98 -19.71 -0.70
HANG SENG. . . . . . . . . . . 21902.40 97.65 0.45
S&P/ASX 20 INDEX . . . . . . 2680.60 -4.00 -0.15
ASX ALL ORDINARIES . . . 4539.40 -0.50 -0.01
BOVESPA SAO PAOLO . 59205.54 367.93 0.63
ISEQ OVERALL INDEX . . . 2840.42 14.67 0.52
STI . . . . . . . . . . . . . . . . . . . . 3096.12 17.17 0.56
IGBM. . . . . . . . . . . . . . . . . . . 957.22 10.24 1.08
SWISS MARKET INDEX. . . 5896.55 70.29 1.21
Price Chg %chg
3M........................................................94.27 -0.33 98.19 78.4
ABBOTT LABS ...................................52.89 0.35 54.24 44.5
ALCOA ................................................15.45 0.28 18.47 9.9
ALTRIA GROUP..................................27.02 0.42 28.13 21.1
AMAZON.COM..................................218.06 6.53 218.40 105.8
AMERICAN EXPRESS........................51.81 0.48 53.80 37.3
AMGEN INC.........................................55.27 0.61 61.53 50.3
APPLE...............................................376.85 3.05 378.65 236.7
AT&T....................................................30.33 0.21 31.94 24.5
BANK OF AMERICA.............................9.57 -0.15 15.31 9.4
BERKSHIRE HATAW B......................76.29 1.18 87.65 73.2
BOEING CO.........................................70.53 0.98 80.65 59.4
BRISTOL MYERS SQUI......................28.81 0.15 29.54 20.0
CATERPILLAR..................................109.64 1.84 116.55 63.3
CHEVRON.........................................107.48 1.25 109.94 70.9
CISCO SYSTEMS................................15.66 0.23 26.00 14.7
CITIGROUP.........................................38.02 0.28 51.50 36.3
COCA-COLA.......................................69.32 2.20 69.78 51.9
COLGATE PALMOLIVE......................88.52 0.53 89.36 73.1
CONOCOPHILLIPS.............................75.43 -0.01 81.80 50.8
DU PONT(EI) DE NMR........................54.10 0.63 57.00 35.6
EMC CORP..........................................27.38 0.74 28.73 17.9
EXXON MOBIL....................................83.63 0.98 88.23 57.6
GENERAL ELECTRIC.........................18.58 0.29 21.65 14.2
GOOGLE A........................................602.55 7.61 642.96 448.0
HEWLETT PACKARD.........................35.61 0.59 49.39 33.9
HOME DEPOT.....................................36.11 0.42 39.38 26.6
IBM.....................................................185.21 9.93 185.21 122.2
INTEL CORP .......................................23.06 0.78 26.78 17.6
J.P.MORGAN CHASE.........................40.39 0.56 48.36 35.5
JOHNSON & JOHNSON.....................66.72 -0.37 68.05 56.8
KRAFT FOODS A................................35.25 0.07 36.02 24.3
MC DONALD'S CORP ........................86.21 0.81 86.46 68.5
MERCK AND CO. NEW......................35.79 0.30 37.68 31.0
MICROSOFT........................................27.54 0.95 29.46 23.3
OCCID. PETROLEUM.......................106.97 1.71 117.89 72.1
ORACLE CORP...................................32.64 1.15 36.50 21.6
PEPSICO.............................................68.54 0.54 71.89 61.7
PFIZER ................................................19.95 0.31 21.45 14.3
PHILIP MORRIS INTL.........................68.51 1.68 71.75 49.2
PROCTER AND GAMBLE..................64.61 0.06 67.72 56.5
QUALCOMM INC ................................56.98 1.70 59.84 35.7
SCHLUMBERGER ..............................88.70 1.49 95.64 52.9
TRAVELERS CIES..............................57.03 0.51 64.17 48.4
UNITED TECHNOLOGIE ....................88.82 1.20 91.83 64.5
UNITEDHEALTH GROUP...................51.45 -0.50 53.50 29.9
VERIZON COMMS ..............................36.97 0.26 38.95 26.4
WAL-MART STORES..........................53.97 0.65 57.90 49.0
WALT DISNEY CO..............................39.54 0.79 44.34 31.5
WELLS FARGO & CO.........................28.41 1.53 34.25 23.0
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 ..................1.376 0.03
LIBOR Euro - 12 months ................2.162 0.02
LIBOR USD - overnight...................0.122 0.00
LIBOR USD - 12 months.................0.749 0.00
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 .........................4.380 0.00
European repo rate.........................1.355 -0.05
Euro Euribor ....................................1.473 0.08
The vix index ...................................19.20 -2.02
The baItic dry index ........................1.340 -0.01
Markit iBoxx...................................222.63 -0.38
Markit iTraxx....................................95.06 0.00
Price Chg High Low
Price Chg %chg Price Chg %chg Price Chg %chg
US SHARES
6/$ 1.4141 0.0027
6/ 0.8768 0.0021
6/ 112.05 0.4750
/6 1.1403 0.0032
/$ 1.6124 0.0068
/ 127.75 0.7400
FTSE 100
5789.99
37.18
FTSE 250
11592.41
64.63
FTSE ALL SHARE
3016.33
19.12
DOW
12587.42
202.26
NASDAQ
2826.52
61.41
S&P 500
1326.73
21.29
RPC Group . . . . . . . .349.6 5.1 384.8 202.2
Smiths Group . . . . .1141.0 21.0 1429.0 1089.0
Brown (N.) Group . . .273.0 3.0 311.2 221.0
Carpetright . . . . . . . . .593.0 7.0 835.5 567.2
Debenhams . . . . . . . . .65.7 1.9 77.4 56.1
Dignity . . . . . . . . . . . .785.0 4.0 812.0 633.0
Dixons RetaiI . . . . . . .16.1 0.2 28.5 11.8
DuneImGroup . . . . . .464.6 -1.2 550.0 371.1
HaIfords Group . . . . .356.0 -0.3 518.5 348.2
Home RetaiI Group . .138.4 1.5 244.5 134.6
Inchcape . . . . . . . . . .375.5 1.7 425.4 253.2
JD Sports Fashion . .990.0 40.0 1030.0 723.5
Kesa EIectricaIs . . . .133.6 -0.7 174.0 109.8
Kingfisher . . . . . . . . .253.6 2.6 287.1 198.5
Marks & Spencer G . .354.1 1.9 427.5 329.3
Mothercare . . . . . . . .404.1 -1.4 627.5 381.5
Next . . . . . . . . . . . . .2397.0 18.0 2410.0 1868.0
Sports Direct Int . . . .247.4 -4.6 262.0 101.1
WH Smith . . . . . . . . . .495.7 0.7 523.0 398.2
Smith & Nephew . . . .654.5 1.0 742.0 537.5
Synergy HeaIth . . . . .934.0 3.5 948.0 640.0
Barratt DeveIopme . .101.6 0.8 119.0 70.1
BeIIway . . . . . . . . . . . .660.0 5.0 753.5 511.0
YuIe Catto & Co . . . . .224.6 1.0 253.0 122.6
BaIfour Beatty . . . . . .298.9 1.0 357.3 234.6
KeIIer Group . . . . . . .463.8 8.7 698.5 432.0
Kier Group . . . . . . . .1340.0 18.0 1418.0 970.0
Drax Group . . . . . . . .496.8 0.3 503.5 353.6
Scottish & Southe . .1413.0 3.0 1425.0 1108.0
Domino Printing S . .662.0 1.5 705.0 440.0
HaIma . . . . . . . . . . . . .409.6 4.1 429.6 270.0
Laird . . . . . . . . . . . . . .186.0 1.0 207.0 101.0
Morgan CrucibIe C . .329.0 -6.9 357.1 189.1
Renishaw . . . . . . . . .1760.0 -17.0 1854.0 778.0
Spectris . . . . . . . . . .1645.0 0.0 1679.0 869.5
Aberforth SmaIIer . . .689.0 0.0 714.0 507.0
AIIiance Trust . . . . . .377.0 0.8 392.7 307.6
Bankers Inv Trust . . .405.1 -0.9 428.0 353.6
BH GIobaI Ltd. GB .1121.0 16.0 1174.0 1058.0
BH GIobaI Ltd. US . . . .11.1 0.2 11.6 10.4
BH Macro Ltd. EUR . . .17.2 0.1 17.2 15.8
BH Macro Ltd. GBP 1774.0 18.0 1775.0 1630.0
BH Macro Ltd. USD . . .17.1 0.2 17.2 15.8
BIackRock WorId M .764.0 12.0 815.5 538.0
BIueCrest AIIBIue . . .173.4 -0.1 176.2 164.5
British Assets Tr . . . .131.7 -0.5 140.5 115.3
British Empire Se . . .519.0 5.0 533.0 422.5
CaIedonia Investm .1759.0 15.0 1928.0 1543.0
City of London In . . .293.6 1.1 306.9 249.3
Dexion AbsoIute L . .145.0 -0.6 151.0 131.2
Edinburgh Dragon . .241.9 -0.5 262.1 210.6
Edinburgh Inv Tru . . .459.9 0.0 492.2 390.9
EIectra Private E . . .1731.0 9.0 1755.0 1289.0
F&C Inv Trust . . . . . .314.8 0.9 327.9 263.8
FideIity China Sp . . . . .97.8 0.8 128.7 93.0
FideIity European . .1198.0 13.0 1287.0 937.5
FideIity SpeciaI . . . . .549.0 5.0 595.0 523.0
HeraId Inv Trust . . . .523.0 1.5 545.5 370.0
HICL Infrastructu . . .115.2 0.6 121.3 112.0
Impax Environment .114.4 -0.1 130.5 106.5
JPMorgan American .876.0 -1.0 916.0 673.0
JPMorgan Asian In . .239.4 4.3 250.8 192.2
JPMorgan Emerging .587.5 2.0 639.0 498.6
JPMorgan European .913.5 2.5 983.5 641.0
JPMorgan Indian I . . .420.4 2.4 502.0 394.1
JPMorgan Russian .664.0 4.0 755.0 549.0
Law Debenture Cor . .372.4 -0.6 385.0 295.1
MercantiIe Inv Tr . . .1048.0 3.0 1137.0 904.5
Merchants Trust . . . .395.4 2.9 431.8 342.0
Monks Inv Trust . . . .352.2 3.3 367.9 282.0
Murray Income Tru . .645.0 6.5 673.0 553.5
Murray Internatio . . .946.0 4.0 991.5 823.5
PerpetuaI Income . . .264.0 2.5 276.0 217.8
PoIar Cap TechnoI . .360.4 1.7 391.2 275.6
RIT CapitaI Partn . . .1310.0 -9.0 1334.0 1107.0
Scottish Inv Trus . . . .510.0 8.5 524.0 409.0
Scottish Mortgage . .756.0 6.5 781.0 566.0
SVG CapitaI . . . . . . . .254.0 -4.1 279.8 148.9
TempIe Bar Inv Tr . . .903.0 5.0 952.0 754.0
TempIeton Emergin .659.0 3.5 689.5 534.5
TR Property Inv T . . .188.1 1.4 206.1 138.2
TR Property Inv T . . . .90.6 2.4 94.0 62.1
Witan Inv Trust . . . . .513.0 2.0 533.0 426.1
3i Group . . . . . . . . . . .272.2 -0.5 340.0 254.1
3i Infrastructure . . . .124.0 0.8 125.2 108.9
Aberdeen Asset Ma .226.4 7.0 240.0 124.5
Ashmore Group . . . .404.1 0.1 414.5 265.4
Brewin DoIphin Ho . .160.7 2.2 185.4 114.0
CameIIia . . . . . . . . . .9891.0 91.010950.0 7900.0
CharIes TayIor Co . . .151.0 11.8 234.0 122.0
City of London Gr . . . .78.5 0.0 93.6 70.7
City of London In . . .417.3 -2.8 461.5 274.0
CIose Brothers Gr . . .744.0 1.0 888.5 664.0
CoIIins Stewart H . . . .75.0 -0.3 90.8 69.0
EvoIution Group . . . . .72.0 5.5 92.0 62.3
F&C Asset Managem .74.0 0.3 92.9 47.5
Hargreaves Lansdo .598.0 4.5 646.5 325.1
HeIphire Group . . . . . . .3.2 -0.1 41.0 3.1
Henderson Group . . .154.9 5.8 173.1 119.1
Highway CapitaI . . . . .16.5 0.0 21.0 6.0
ICAP . . . . . . . . . . . . . .471.8 6.9 570.5 380.2
IG Group HoIdings . .433.7 22.3 553.0 409.2
Intermediate Capi . . .276.0 -1.7 360.3 252.7
InternationaI Per . . . .354.0 -7.3 388.8 189.0
InternationaI Pub . . .116.9 0.5 118.3 108.6
Investec . . . . . . . . . . .489.9 5.5 538.0 444.4
IP Group . . . . . . . . . . . .50.0 2.8 54.5 27.9
Jupiter Fund Mana . .250.6 -1.2 337.3 181.0
Liontrust Asset M . . . .75.5 0.5 95.3 70.0
LMS CapitaI . . . . . . . . .62.5 1.4 64.8 40.0
London Finance & . . .22.0 0.3 23.5 16.5
London Stock Exch .996.5 33.0 1076.0 617.0
Lonrho . . . . . . . . . . . . .17.3 0.3 19.8 10.5
Man Group . . . . . . . . .237.5 6.5 311.0 206.4
Paragon Group Of . .195.0 -3.0 206.1 118.7
Provident Financi . .1019.0 19.5 1033.0 728.5
Rathbone Brothers .1138.0 -6.0 1257.0 805.0
Record . . . . . . . . . . . . .30.9 0.0 52.0 20.3
RSM Tenon Group . . .29.8 -0.3 66.3 21.3
Schroders . . . . . . . .1596.0 9.0 1922.0 1193.0
Schroders (Non-Vo .1333.0 7.0 1554.0 999.0
TuIIett Prebon . . . . . .356.4 3.4 428.6 331.3
WaIker Crips Grou . . .50.5 -0.5 51.0 46.5
BT Group . . . . . . . . . .193.0 5.4 204.1 130.6
CabIe & WireIess . . . .39.0 -1.1 61.4 37.5
CabIe & WireIess . . . .44.0 -1.0 83.6 43.9
COLT Group SA . . . .136.0 0.0 156.2 109.0
TaIkTaIk TeIecom . . .140.8 2.9 168.3 114.3
TeIecomPIus . . . . . . .660.0 -15.0 700.0 340.5
Booker Group . . . . . . .74.0 -1.0 77.9 42.0
Greggs . . . . . . . . . . . .534.5 3.5 550.5 418.7
Morrison (Wm) Sup .294.5 1.0 308.3 262.7
Ocado Group . . . . . . .189.3 0.9 285.0 123.5
Sainsbury (J) . . . . . . .316.0 1.8 395.0 313.8
Tesco . . . . . . . . . . . . .392.1 -3.0 440.7 378.1
Associated Britis . .1070.0 -9.0 1182.0 940.0
Cranswick . . . . . . . . .728.0 0.0 907.5 723.0
Dairy Crest Group . . .374.3 -7.9 424.9 339.7
Devro . . . . . . . . . . . . .273.0 8.0 296.9 205.5
Premier Foods . . . . . . .20.6 -0.1 35.1 16.0
Tate & LyIe . . . . . . . . .603.0 -2.5 656.0 409.1
UniIever . . . . . . . . . .1954.0 -4.0 2065.0 1688.0
Mondi . . . . . . . . . . . . .614.5 6.5 664.0 398.1
Centrica . . . . . . . . . . .325.8 7.3 346.1 303.4
InternationaI Pow . . .299.0 -1.6 448.6 299.0
NationaI Grid . . . . . . .594.5 -4.0 632.5 488.7
Northumbrian Wate .453.5 -0.4 458.9 295.5
Pennon Group . . . . . .698.5 2.0 715.0 560.0
Severn Trent . . . . . .1428.0 1.0 1517.0 1264.0
United UtiIities . . . . .579.5 -1.5 632.0 543.5
Cookson Group . . . . .619.0 14.0 724.5 411.1
DS Smith . . . . . . . . . .240.1 -0.6 266.2 125.8
Rexam . . . . . . . . . . . .372.4 2.5 400.0 293.0
GIencore Internat . . .488.3 0.3 531.1 466.7
BAE Systems . . . . . .298.6 1.7 369.9 294.7
Chemring Group . . . .570.5 15.5 736.5 519.6
Cobham . . . . . . . . . . .205.1 -0.3 247.6 192.3
Meggitt . . . . . . . . . . . .371.3 2.1 389.1 261.7
QinetiQ Group . . . . . .117.4 -0.1 136.3 96.7
RoIIs-Royce Group . .635.5 5.5 665.0 552.0
Senior . . . . . . . . . . . . .185.0 1.3 187.6 111.2
UItra EIectronics . . .1602.0 6.0 1895.0 1544.0
GKN . . . . . . . . . . . . . .227.2 -0.7 245.0 132.0
BarcIays . . . . . . . . . . .211.6 4.0 344.0 207.6
HSBC HoIdings . . . . .593.7 2.5 730.9 588.7
LIoyds Banking Gr . . .43.1 1.8 77.6 41.1
RoyaI Bank of Sco . . .33.1 0.1 52.1 32.5
Standard Chartere .1575.0 -21.5 1950.0 1519.0
AG Barr . . . . . . . . . .1309.0 1.0 1395.0 1035.0
Britvic . . . . . . . . . . . . .370.3 2.1 518.0 364.5
Diageo . . . . . . . . . . .1228.0 -6.0 1307.0 1050.0
SABMiIIer . . . . . . . . .2284.5 -21.0 2337.5 1841.0
AZ EIectronic Mat . . .271.9 7.9 338.1 248.5
Croda Internation . .2015.0 31.0 2081.0 1130.0
EIementis . . . . . . . . . .182.0 5.0 187.4 68.5
Johnson Matthey . .2016.0 78.0 2119.0 1550.0
Victrex . . . . . . . . . . .1510.0 -13.0 1590.0 1076.0
Price Chg High Low
BerkeIey Group Ho .1232.0 -12.0 1299.0 789.5
Bovis Homes Group .415.0 -0.7 464.7 326.6
Persimmon . . . . . . . .458.0 -1.6 502.5 336.5
Reckitt Benckiser . .3422.0 -34.0 3648.0 3015.0
Redrow . . . . . . . . . . . .129.0 1.0 139.0 97.5
TayIor Wimpey . . . . . .35.5 0.3 43.3 22.3
Bodycote . . . . . . . . . .352.1 4.1 397.7 214.5
Charter Internati . . . .797.5 9.5 853.5 538.5
Fenner . . . . . . . . . . . .409.0 10.9 419.1 198.0
IMI . . . . . . . . . . . . . . .1046.0 9.0 1119.0 657.5
MeIrose . . . . . . . . . . .352.6 -0.6 378.0 212.5
Northgate . . . . . . . . . .325.0 1.5 346.7 180.0
Rotork . . . . . . . . . . .1565.0 10.0 1895.0 1395.0
Spirax-Sarco Engi . .1895.0 8.0 2063.0 1499.0
Weir Group . . . . . . .2126.0 60.0 2196.0 1130.0
Ferrexpo . . . . . . . . . . .461.0 3.7 499.0 251.6
TaIvivaara Mining . . .404.7 7.0 622.0 386.9
BBA Aviation . . . . . . .209.4 -2.2 240.8 175.0
Stobart Group Ltd . . .141.0 4.0 163.6 124.1
AdmiraI Group . . . . .1550.0 15.0 1754.0 1409.0
AmIin . . . . . . . . . . . . .388.8 5.1 433.0 375.3
Huntsworth . . . . . . . . .71.8 1.0 86.0 65.0
Informa . . . . . . . . . . . .413.7 4.8 461.1 352.8
ITE Group . . . . . . . . . .227.5 -6.5 258.2 139.6
ITV . . . . . . . . . . . . . . . . .64.8 1.1 93.5 49.8
Johnston Press . . . . . . .5.0 -0.5 20.0 4.4
MecomGroup . . . . . .225.0 5.5 310.0 187.0
Moneysupermarket. .115.1 0.6 115.7 65.1
Pearson . . . . . . . . . .1139.0 2.0 1207.0 920.0
PerformGroup . . . . .207.4 4.4 234.5 201.7
Reed EIsevier . . . . . .542.0 5.5 590.5 505.5
Rightmove . . . . . . . .1182.0 -18.0 1250.0 596.5
STV Group . . . . . . . . .128.8 0.8 168.0 79.8
Tarsus Group . . . . . .153.0 2.8 165.0 112.5
Trinity Mirror . . . . . . . .41.8 2.0 124.3 39.8
United Business M . .516.5 0.5 725.0 507.0
UTV Media . . . . . . . . .129.0 5.3 151.0 106.0
WiImington Group . .113.0 -0.5 183.0 113.0
WPP . . . . . . . . . . . . . .709.0 19.0 846.5 633.0
YeII Group . . . . . . . . . . .7.5 -0.7 30.2 5.1
African Barrick G . . .467.8 -4.5 638.0 393.5
AngIo American . . .2953.5 51.0 3437.0 2254.0
AngIo Pacific Gro . . .310.0 2.0 369.3 249.0
Antofagasta . . . . . . .1424.0 43.0 1634.0 913.0
Aquarius PIatinum . .309.7 3.4 419.0 227.1
BHP BiIIiton . . . . . . .2326.0 38.5 2631.5 1767.0
BeazIey . . . . . . . . . . . .126.6 1.1 139.2 110.4
CatIin Group Ltd. . . .384.5 3.9 421.4 325.0
Hiscox Ltd. . . . . . . . . .395.5 0.5 424.7 341.5
Jardine LIoyd Tho . . .636.5 6.0 709.0 561.0
Lancashire HoIdin . . .674.5 5.0 679.0 515.0
RSA Insurance Gro . .131.7 -0.4 143.5 120.1
Aviva . . . . . . . . . . . . .393.7 1.7 477.9 334.0
LegaI & GeneraI G . . .112.5 0.6 123.8 84.2
OId MutuaI . . . . . . . . .126.6 1.1 145.2 111.4
Phoenix Group HoI . .567.5 7.0 758.0 558.0
PrudentiaI . . . . . . . . .664.5 2.0 777.0 506.0
ResoIution Ltd. . . . . .275.2 10.2 316.1 211.3
St James's PIace . . . .355.2 -0.5 372.1 233.5
Standard Life . . . . . . .196.5 1.7 244.7 190.7
4Imprint Group . . . . .276.0 0.0 295.0 195.0
Aegis Group . . . . . . .152.9 1.2 162.3 107.0
BIoomsbury PubIis . .116.5 1.4 138.0 108.5
British Sky Broad . . .734.0 20.5 850.0 692.0
Centaur Media . . . . . . .50.8 -0.8 73.0 44.8
Chime Communicati .254.3 5.0 298.5 165.8
Creston . . . . . . . . . . .108.0 0.5 121.0 78.5
DaiIy MaiI and Ge . . .413.3 2.1 594.5 411.1
Euromoney Institu . .650.5 6.5 736.0 578.0
Future . . . . . . . . . . . . . .11.8 -1.4 30.0 11.8
Haynes PubIishing . .255.0 0.0 262.5 202.5
Centamin Egypt Lt . .141.0 -0.5 197.1 114.5
Eurasian NaturaI . . .759.5 16.5 1125.0 695.5
FresniIIo . . . . . . . . . .1660.0 1.0 1682.0 990.0
GemDiamonds Ltd. .245.0 8.0 306.0 186.3
HochschiId Mining . .504.5 -5.0 680.0 289.4
Kazakhmys . . . . . . .1343.0 41.0 1671.0 1017.0
Kenmare Resources . .52.9 -0.4 59.9 13.3
Lonmin . . . . . . . . . . .1320.0 8.0 1983.0 1312.0
New WorId Resourc .873.0 37.5 1060.0 835.5
PetropavIovsk . . . . . .830.0 28.5 1252.0 678.0
RandgoId Resource 5525.0 -35.0 6655.0 4425.0
Rio Tinto . . . . . . . . .4366.0 58.0 4712.0 3048.5
Vedanta Resources 1842.0 48.0 2583.0 1794.0
Xstrata . . . . . . . . . . .1344.0 20.5 1550.0 918.2
Inmarsat . . . . . . . . . . .513.0 -4.0 756.5 511.5
Vodafone Group . . . .158.7 1.5 181.9 143.0
Genesis Emerging . .525.5 4.0 568.0 458.0
Afren . . . . . . . . . . . . . .149.8 0.7 171.2 82.8
BG Group . . . . . . . . .1404.5 23.5 1564.5 1003.5
BP . . . . . . . . . . . . . . . .460.6 4.6 509.0 375.2
Cairn Energy . . . . . . .382.7 11.2 493.2 366.0
EnQuest . . . . . . . . . . .122.0 2.4 158.5 103.7
Essar Energy . . . . . .375.6 6.6 589.5 367.9
ExiIIon Energy . . . . . .430.4 0.3 469.7 166.5
Heritage OiI . . . . . . . .233.2 -2.0 486.0 210.0
JKX OiI & Gas . . . . . .251.9 0.4 335.1 246.7
Premier OiI . . . . . . . . .406.4 2.9 535.0 357.5
RoyaI Dutch SheII . .2230.0 14.5 2326.5 1703.0
RoyaI Dutch SheII . .2239.0 20.5 2336.0 1642.0
SaIamander Energy .273.3 -0.9 317.6 210.0
Soco Internationa . . .354.0 1.0 484.2 292.0
TuIIow OiI . . . . . . . . .1279.0 19.0 1493.0 1123.0
Amec . . . . . . . . . . . .1098.0 14.0 1251.0 848.5
Hunting . . . . . . . . . . .790.0 -2.0 817.0 483.3
John Wood Group . .696.5 16.0 715.8 339.5
LampreII . . . . . . . . . . .382.0 2.0 394.3 205.4
Petrofac Ltd. . . . . . .1454.0 28.0 1685.0 1250.0
Burberry Group . . . .1545.0 7.0 1577.0 805.0
PZ Cussons . . . . . . . .370.0 0.0 409.0 320.5
Supergroup . . . . . . .1071.0 7.0 1820.0 818.5
AstraZeneca . . . . . .3018.5 3.5 3385.0 2801.5
BTG . . . . . . . . . . . . . .298.0 0.8 309.7 196.2
Genus . . . . . . . . . . . .1002.0 -6.0 1046.0 704.5
GIaxoSmithKIine . . .1323.0 -12.0 1375.5 1111.0
Hikma Pharmaceuti .732.0 2.0 900.0 687.5
Shire PIc . . . . . . . . . .2074.0 -1.0 2080.0 1376.0
CapitaI & Countie . . .189.5 -0.7 203.7 110.0
Daejan HoIdings . . .2884.0 -70.0 2965.0 2275.0
F&C CommerciaI Pr .102.8 -0.1 108.0 88.0
Grainger . . . . . . . . . . .120.7 0.5 133.2 86.3
London & Stamford .130.3 -0.5 140.0 110.3
SaviIIs . . . . . . . . . . . . .358.8 -7.4 427.1 291.0
St. Modwen Proper . .175.1 -3.8 196.2 135.4
UK CommerciaI Pro . .79.2 -0.8 85.5 74.3
Unite Group . . . . . . . .209.6 -0.1 229.8 175.0
Big YeIIow Group . . .301.7 -0.4 353.3 287.1
British Land Co . . . . .598.0 -6.5 629.5 443.0
CapitaI Shopping . . .371.2 6.7 424.8 320.9
Derwent London . . .1798.0 2.0 1880.0 1296.0
Great PortIand Es . . .439.5 3.9 445.0 295.9
Hammerson . . . . . . . .463.0 2.4 490.9 352.2
Hansteen HoIdings . . .88.2 0.7 89.3 59.4
Land Securities G . . .864.5 -1.5 885.0 577.0
SEGRO . . . . . . . . . . . .303.0 0.5 331.3 262.5
Shaftesbury . . . . . . . .522.0 0.5 539.0 384.4
Autonomy Corporat 1703.0 -27.0 1866.0 1271.0
Aveva Group . . . . . .1744.0 6.0 1799.0 1260.0
Computacenter . . . . .461.9 -9.1 489.7 265.0
Fidessa Group . . . . .1934.0 -39.0 2109.0 1350.0
Invensys . . . . . . . . . . .303.5 5.2 364.3 230.2
Kofax . . . . . . . . . . . . .487.4 0.3 535.0 231.0
Logica . . . . . . . . . . . .118.1 3.0 147.2 101.7
Micro Focus Inter . . .296.3 -3.1 437.0 276.0
Misys . . . . . . . . . . . . .381.4 -3.6 420.2 254.1
Sage Group . . . . . . . .278.5 3.3 302.0 235.3
SDL . . . . . . . . . . . . . . .678.0 -12.5 711.5 510.0
TeIecity Group . . . . . .531.0 14.0 557.0 420.5
Aggreko . . . . . . . . . .2001.0 32.0 2034.0 1351.3
Ashtead Group . . . . .154.6 -1.1 207.9 77.0
Atkins (WS) . . . . . . . .706.0 -6.0 820.0 650.0
Babcock Internati . . .674.5 -3.5 733.0 492.8
Berendsen . . . . . . . . .537.0 -2.0 568.0 361.8
BunzI . . . . . . . . . . . . .776.0 4.5 801.0 679.0
Capita Group . . . . . . .697.5 8.5 794.5 635.5
CariIIion . . . . . . . . . . .365.4 1.9 403.2 291.2
De La Rue . . . . . . . . .758.0 0.0 923.5 549.5
EIectrocomponents .231.0 -0.1 294.9 205.7
Experian . . . . . . . . . . .811.0 9.0 833.5 606.0
FiItrona PLC . . . . . . . .355.1 -3.4 385.5 227.5
G4S . . . . . . . . . . . . . . .273.6 1.7 291.0 237.7
Hays . . . . . . . . . . . . . . .90.9 1.0 133.6 89.0
Homeserve . . . . . . . .484.6 -6.1 532.0 408.0
Howden Joinery Gr . .105.0 0.4 127.5 63.0
Intertek Group . . . . .1876.0 23.0 2148.0 1577.0
MichaeI Page Inte . . .506.5 0.0 567.0 368.0
Mitie Group . . . . . . . .233.9 0.9 242.5 188.7
Premier FarneII . . . . .182.4 0.2 308.8 180.2
Regus . . . . . . . . . . . . .101.7 0.7 119.0 66.1
RentokiI InitiaI . . . . . . .90.2 -0.1 109.5 84.3
RPS Group . . . . . . . . .227.0 1.1 253.0 169.8
Serco Group . . . . . . .555.0 15.0 633.0 529.5
Shanks Group . . . . . .126.6 0.5 130.9 96.5
SIG . . . . . . . . . . . . . . .132.4 0.3 153.5 90.7
SThree . . . . . . . . . . . .380.7 -9.3 447.6 231.1
Travis Perkins . . . . . .931.0 12.0 1127.0 747.0
WoIseIey . . . . . . . . .1831.0 9.0 2261.0 1223.0
ARM HoIdings . . . . . .582.5 13.5 651.0 300.5
CSR . . . . . . . . . . . . . .290.4 0.8 447.0 280.9
Imagination Techn . .380.4 -5.4 502.0 303.5
Pace . . . . . . . . . . . . . .109.4 -1.6 231.8 93.0
Spirent Communica .134.6 2.1 160.3 117.3
British American . .2745.0 -30.0 2847.0 2166.0
ImperiaI Tobacco . .2140.0 -8.0 2231.0 1784.0
Avis Europe . . . . . . . .312.5 0.5 312.9 184.0
Betfair Group . . . . . . .632.0 16.5 1550.0 615.5
Bwin.party Digita . . .140.1 7.8 309.5 127.0
CarnivaI . . . . . . . . . .2220.0 35.0 3153.0 2037.0
Compass Group . . . .583.0 6.0 612.0 501.0
Domino's Pizza UK . .445.5 9.9 586.0 377.0
easyJet . . . . . . . . . . . .306.4 5.4 479.0 300.1
Enterprise Inns . . . . . .59.0 0.9 122.7 57.7
FirstGroup . . . . . . . . .347.1 4.2 412.6 311.3
Go-Ahead Group . . .1540.0 9.0 1598.0 1073.0
Greene King . . . . . . .481.6 1.4 518.0 398.0
InterContinentaI . . .1226.0 24.0 1435.0 982.0
InternationaI Con . . .226.9 4.3 305.0 199.4
JD Wetherspoon . . . .430.0 6.6 468.3 389.
Ladbrokes . . . . . . . . .140.1 0.9 155.3 122.
Marston's . . . . . . . . . .102.0 1.6 117.1 92.
MiIIennium& Copt . .506.0 12.0 600.5 431.
MitcheIIs & ButIe . . . .284.4 0.1 361.0 279.
NationaI Express . . .242.0 0.3 270.2 220.
Punch Taverns . . . . . .68.2 1.3 90.4 58.
Rank Group . . . . . . . .149.7 -4.0 156.1 102.
Restaurant Group . . .293.2 2.8 335.0 214.
Stagecoach Group . .249.8 1.2 268.5 160.
Thomas Cook Group .68.4 1.4 204.8 66.
TUI TraveI . . . . . . . . . .180.5 2.3 271.9 174.
Whitbread . . . . . . . .1520.0 -2.0 1887.0 1368.
WiIIiamHiII . . . . . . . . .220.8 3.2 237.3 155.
Abcam . . . . . . . . . . . .420.0 4.0 460.0 277.
AIbemarIe & Bond . .389.8 6.8 397.5 218.
Amerisur Resource . .22.0 0.5 29.0 11.
Andor TechnoIogy . .620.0 -4.0 659.0 282.
ArchipeIago Resou . . .56.8 -0.3 66.8 32.
ASOS . . . . . . . . . . . .2370.0 -36.0 2468.0 840.
AureIian OiI & Ga . . . .68.8 8.8 92.0 36.
Avanti Communicat .367.3 -4.8 735.0 339.
Avocet Mining . . . . . .223.5 -4.0 253.5 112.
BIinkx . . . . . . . . . . . . .120.0 -1.0 148.8 53.
Borders & Souther . . .54.0 2.0 93.0 49.
BowLeven . . . . . . . . .297.0 5.0 398.0 148.
Brooks MacdonaId 1242.0 6.0 1372.5 817.
CaIedon Resources .111.3 0.3 111.5 36.
Conygar Investmen .107.4 0.6 120.0 101.
Cove Energy . . . . . . . .94.8 0.0 112.8 56.
Daisy Group . . . . . . .121.0 -0.9 127.0 86.
EMIS Group . . . . . . . .542.0 -2.8 557.0 303.
Encore OiI . . . . . . . . . .59.3 -1.5 151.5 49.
Faroe PetroIeum . . . .172.0 -2.0 218.3 126.
GuIfsands PetroIe . . .213.3 3.3 401.5 207.
GWPharmaceuticaI .120.0 -0.9 130.0 83.
Hamworthy . . . . . . . .655.0 -11.0 705.0 325.
Hargreaves Servic .1029.0 1.0 1076.0 602.
HeaIthcare Locums .112.5 0.0 112.5 112.
Immunodiagnostic .1120.0 45.0 1129.0 710.
ImpeIIamGroup . . . .358.0 -2.0 387.5 84.
James HaIstead . . . . .471.0 5.8 489.8 306.
KaIahari MineraIs . . .226.5 0.0 301.0 142.
London Mining . . . . .401.0 1.0 436.5 240.
Lupus CapitaI . . . . . .117.0 0.5 150.0 78.
M. P. Evans Group . .430.8 5.8 500.5 343.
Majestic Wine . . . . . .481.5 -6.8 510.0 301.
May Gurney Integr . .276.0 4.5 289.3 177.
Monitise . . . . . . . . . . . .36.0 0.0 39.0 18.
MuIberry Group . . . .1840.0 84.0 1869.0 285.
Nanoco Group . . . . . . .80.5 -0.6 115.8 68.
NauticaI PetroIeu . . .335.5 0.5 547.0 128.
NichoIs . . . . . . . . . . . .577.3 -1.8 584.5 401.
Numis Corporation . .116.1 -0.6 146.5 94.
Pan African Resou . . .13.3 -0.3 13.8 5.
Patagonia GoId . . . . . .52.0 -1.3 59.3 13.
Prezzo . . . . . . . . . . . . .67.0 -1.5 71.5 38.
Pursuit Dynamics . . .318.8 7.8 700.0 218.
Rockhopper ExpIor .230.5 11.5 510.0 202.
RWS HoIdings . . . . . .454.9 -4.0 472.0 239.
Songbird Estates . . .147.0 0.8 160.3 135.
VaIiant PetroIeum . . .574.5 -12.5 761.5 504.
Young & Co's Brew .696.0 3.8 712.0 515.
Bwin.party DigitaI . . .140.1 5.9
IG Group HoIdings . .433.7 5.4
New WorId Resource 873.0 4.5
LIoyds Banking Gro . .43.1 4.3
JD Sports Fashion . .990.0 4.2
Johnson Matthey . .2016.0 4.0
Henderson Group . . .154.9 3.9
ResoIution Ltd. . . . . .275.2 3.9
PetropavIovsk . . . . . .830.0 3.6
London Stock Excha 996.5 3.4
ITE Group . . . . . . . . .227.5 -2.8
CabIe & WireIess C . . .39.0 -2.6
Rank Group . . . . . . . .149.7 -2.6
SThree . . . . . . . . . . . .380.7 -2.4
Daejan HoIdings . . .2884.0 -2.4
CabIe & WireIess W . .44.0 -2.2
TeIecom PIus . . . . . . .660.0 -2.2
St. Modwen Propert .175.1 -2.1
Dairy Crest Group . . .374.3 -2.1
Morgan CrucibIe Co .329.0 -2.1
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
ALTERNATIVE ENERGY
CHEMICALS
BEVERAGES
GENERAL INDUSTRIALS
MOBILE TELECOMS
OIL & GAS PRODUCERS
OIL EQUIPMENT & SERVICES
MINING
NONEQUITY INVESTM. COMM.
Tsy 2.500 11 . . . .306.96 0.00 310.0 306.9
Tsy 3.250 11 . . . .101.06 -0.02 103.5 101.1
Tsy 9.000 11 . . . . .99.99 0.00 108.1 100.0
Tsy 9.000 12 . . . .108.65 0.00 116.1 107.8
Tsy 5.000 12 . . . .102.80 -0.04 106.9 102.7
Tsy 5.250 12 . . . .104.08 -0.03 108.1 104.1
Tsy 4.500 13 . . . .106.15 -0.04 109.2 105.8
Tsy 2.500 13 . . . .287.11 -0.03 287.7 274.9
Tsy 8.000 13 . . . .115.59 -0.04 121.3 115.5
Tsy 5.000 14 . . . .111.57 -0.10 114.1 109.2
Tsy 7.750 15 . . . .102.75 -0.90 342.1 102.8
Tsy 8.000 15 . . . .126.90 -0.13 131.6 123.7
Tsy 4.750 15 . . . .112.58 -0.12 114.7 108.6
Tsy 4.000 16 . . . .110.15 -0.13 111.4 104.9
Tsy 2.500 16 . . . .334.34 0.08 334.4 304.4
Tsy 12.000 17 . . .126.23 0.00 185.9 125.2
Tsy 1.250 17 . . . .112.33 0.06 112.4 104.9
Tsy 8.750 17 . . . .137.17 -0.43 142.2 132.9
Tsy 5.000 18 . . . .116.22 -0.13 117.6 109.7
Tsy 4.500 19 . . . .112.65 -0.15 113.8 105.4
Tsy 3.750 19 . . . .106.81 -0.16 107.7 99.4
Tsy 2.500 20 . . . .342.55 0.02 342.8 303.8
Tsy 4.750 20 . . . .113.93 -0.20 115.9 106.6
Tsy 8.000 21 . . . .142.77 -0.22 147.1 133.8
Tsy 4.000 22 . . . .106.02 -0.20 108.4 99.0
Tsy 1.875 22 . . . .118.34 0.08 118.5 108.5
Tsy 2.500 24 . . . .301.60 0.11 301.9 262.1
Tsy 5.000 25 . . . .114.47 -0.24 118.5 107.4
Tsy 4.250 27 . . . .104.62 -0.14 108.8 97.9
Tsy 1.250 27 . . . .112.53 0.27 112.8 100.5
Tsy 6.000 28 . . . .127.06 -0.15 132.7 119.5
Tsy 4.750 30 . . . .110.08 -0.15 115.0 103.0
Tsy 4.125 30 . . . .287.58 0.15 288.4 248.7
Tsy 4.250 32 . . . .103.02 -0.16 107.8 96.0
Tsy 4.250 36 . . . .102.29 -0.20 107.4 95.0
Tsy 4.750 38 . . . .110.87 -0.20 116.5 102.8
Tsy 4.500 42 . . . .107.19 0.00 112.8 98.9
% %
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22 CITYA.M. 20 JULY 2011
Transparency belongs
at the Citys heart
Picture: GETTY
Osbornes Treasury is
leading the way in
government
transparency
Picture: Micha
Theiner/ CITY A.M.
B
EING in business is about value cre-
ation. We live in a capitalist society;
it is profits, losses, warnings, and
dividends that routinely make the
business headlines. But if theres one thing
that recent events involving the press have
shown, it is that businesses have to deliver
more than just economic value to survive.
They need to deliver public value too.
Current events at News International
capture this perfectly. The News of the
World was a profitable business that sold
millions of papers every week. But the
scale of the phone-hacking scandal turned
the brand toxic, and a profitable paper dis-
appeared from newsstands. Corporate his-
tory is littered with examples of
reputational damage forcing rebrands or
collapses.
With a global society that is more edu-
cated and informed than ever before, a
companys value needs to be measured in
more than just pounds and dollars. There
is an x-factor that is increasingly having an
impact on customers, clients, and supply
chains.
Looking at the world of finance, the lack
of attention given to reputational issues by
some finance institutions may have been a
significant contributory factor to the
financial crisis. A pervasive compliance
mindset meant some institutions stopped
thinking about whether something was
right or wrong or even sensible, just so
long as it delivered profit within the rules.
Delivering public value requires a mix-
ture of different actions and behaviours. It
requires ethical behaviour, honesty
about a businesss mistakes and its prac-
tices and openness. It means businesses
scrutinising their supply chain to ensure it
lives up to the values it applies to itself; it
means treating employees fairly. It
demands transparency.
Transparency is the key to unlocking
public value. Without it, good work goes
unnoticed, while opacity may be assumed
to be covering something up, even if there
is nothing to hide.
It can help protect a business from itself,
too. Imagine how many scandals could
have been avoided if the business involved
had asked itself: what if everybody else
knew we were doing this? Thanks to
social media and the internet, it is never
going to be too long before everybody else
does know.
Businesses neednt see transparency as a
stick, though; there is plenty of carrot
involved. Taking a transparent approach to
business highlights areas for improvement
within a business, allows for benchmark-
ing, and can drive innovation. It can help
businesses differentiate themselves from
competitors too, by showing exactly how
they deliver the public value that their
rivals do not.
The need for transparency is something
that many businesses are already picking
up on. More and more businesses are pro-
ducing Corporate and Social
Responsibility (CSR) reports, for example,
with over 3,000 businesses producing CSR
reports worldwide in 2010.
The challenge is to make corporate
reports true, fair, and informative. Too
often corporate reports are interchange-
able between companies, having fallen vic-
tim to a cautious, boilerplate approach:
they say a lot, but reveal nothing. However,
once again, our internet age means that
any inappropriate reporting is likely to be
spotted quickly.
Of course, there are problems with
being transparent. Deciding exactly when
to be transparent is one of them, especial-
ly when trying to maintain competitive
advantage or corporate confidentiality. Its
undeniably a tricky balancing act that
looks to remain a challenge.
Its a balancing act that needs attempt-
ing though, as any business whose cover-
ups have been uncovered can attest.
L
AST week, the Treasury published
the unaudited whole-of-government
accounts for 2009/10. This was a land-
mark moment for public finance in
the UK, as its the first time that this has
happened; the idea of publishing the
accounts was floated in the mid-90s, so
this is something that weve been waiting
a long time for.
There are a few noteworthy pieces of
information that popped up in these
accounts, which represent causes for con-
cern. The accounts show: over 1 trillion
in public sector pension liabilities;
80.9bn of expenditure in 2009-10 used to
fund the financial deficit; and the govern-
ments net liability of 1.2 trillion, repre-
senting 84 per cent of GDP.
The 1 trillion pensions liability figure
deserves further scrutiny, as its quite like-
ly to be an underestimate. The figure in
the accounts only allows for salaries pro-
jected to retirement or an earlier leaving
date, and the number of years service to
date. What the figure doesnt include are
the pensions that may be paid to current
employees in respect of future years of
service up to retirement, or to future
employees. Without including these fig-
ures, its fair to assume the 1 trillion is
only the beginning.
There are also quibbles that could rea-
sonably be raised around several other
issues in the accounts: a number of
accounting adjustments might have to be
made for local government accounts as
they werent accounting on an IFRS
(International Financial Reporting
Standards) basis in 2009/10; the complete-
ness of the accounting for PFI, as with
pensions liabilities, isnt necessarily
unquestionable; and there are issues
about whether the level of provisions to
cover write-offs, such as student loans,
represent a fair estimate.
The way the Treasury has accounted for
the nationalised banks is notable too, and
represents a significant departure from
the governments Financial Reporting
Manual (FREM). The Treasury has chosen
not to consolidate the banks on the basis
that doing so would distort financial per-
formance. However, this is likely to lead to
an audit qualification due to the material
amounts involved and the departure from
generally accepted accounting practice.
Despite such problems, the Treasury
deserves credit for finally publishing the
accounts. Consolidating UK plc is an
unenviable task, but the Treasury has
come up with a user-friendly set of
accounts that are upfront about potential
qualifications and provide a good expla-
nation of differences between the whole-
of-government accounts and the national
accounts produced by the Office of
National Statistics.
At a time when public spending is
going to dominate the political debate for
the foreseeable future, the ability to hold
government spending to account and con-
duct debates with the full facts available
is crucial. Some of the figures may be
open to debate, but actually publishing
the accounts is a step in the right direc-
tion in terms of the accountability and
transparency of public funds. Its never
been done before, but comes at a time
when public sector transparency is crucial
to business performance.
Being transparent is
good business sense
it can highlight areas
for improvement and
even drive innovation
For the public sector,
releasing data to the
public gaze needs to
be far more common
ANDREW LECK
HEAD OF ACCA UK
GILLIAN FAWCETT
HEAD OF PUBLIC SECTOR, ACCA
An open culture is the best safeguard
against the risk of damaging scandals
City Focus| Accounting
23
24
S
OME days are good, some days are
great. And no doubt about it:
being driven around Goodwood in
a Mercedes-Benz SLS AMG gull-
wing supercar by former F1 world cham-
pion Jody Scheckter is a great
experience. Scheckter, now an organic
farmer at Laverstoke Park Farm, says
hes not been on a race track in years. I
believe him. Im the first hack to ride in
Mr Sheckters SLS taxi and his first lap
seems slow. However by lap four hes fly-
ing like the seasoned pro he is. And
thats the difference between the profes-
sionals and the merely mortal.
Progression and the speed of it.
As for me, my progress at Goodwood
behind the wheel of the SLS AMG is
slower. The improvement my driving
makes over the course of this track day
is what could be politely described as
incremental. But its the measure of the
car that I just want to get back in it time
and time again.
No bones about it: the SLS is a wonder-
ful sports car. Just climbing in and work-
ing out how to shut its marvellous
gullwing door from the drivers seat is
drama enough (though all you need to
do is reach for it, its not as far away as it
looks). And whichever way you look at,
tearing around Goodwood is a great way
to demonstrate its performance.
And what a car it is to look at. It may
not be as elegant as the iconic 300SL but
it certainly succeeds as a badass, mod-
ern day, technological version of it. Its
not perfect. Its face isnt as pretty as it
could have been but I love the long bon-
net and the short rear end. With both
doors raised above the roof the car sim-
ply looks very cool. Wed forgotten how
dramatic ingress and egress can be.
Thank you, Mercedes-Benz, for remind-
ing us a second time. On the SLS, even
the door handles are part of the per-
formance, the handles slide out from
the bodywork when you unlock it and
then slide back in again when the car
pulls away. Bruce Wayne could drive an
SLS as his daily commuter and still
lament the fact that his Batmobile does-
nt have them.
Once inside, the interior is obviously
Your head will be left
spinning by this sports
cars performance
Mercedes ultimate ticket to ride
TESLA BREAK ROUND LAKE GENEVA
If youve never had the chance to drive around Lake Geneva in a
sports car then this may be your chance. The five-star La Rserve
Geneva hotel has introduced a Tesla Break a two night stay for
two including a full days use of a Tesla Roadster fully electric sports-
car. The Tesla accelerates in near total silence from 0-60mph in 3.7
seconds and the package costs 1,892, www.lareserve.ch.
CAR TALK BY RYAN BORROFF
BMW SPECIAL EDITION 1 AND 3 SERIES
BMW is introducing special editions of its BMW 1 and 3-series models
to commemorate its sponsorship of the London 2012 Olympic Games.
The Performance Edition models include M aerodynamic bodystyling
kits, M Sport suspension, dark chrome 18-inch alloys, dark rear lights
and special London 2012 badges. Interiors get special edition sports
seats plus M Sport steering wheel and gearlever.
PEUGEOTS NEW FLAGSHIP
Peugeot has shown its new flagship 508 RXH diesel-electric crossover
ahead of its world premiere at the Frankfurt Motor Show in
September. The four-wheel drive estate is powered by a 2.0-litre
HYbrid4 drive unit which produces 200bhp and can be run in 100 per
cent electric mode. Emissions are just 109g/km of CO2 with claimed
combined mileage figures of just 67.2mpg.
expensive, even though its understated.
Clad in leather and aluminium, theres
something of a retro feel to the cockpit
and other than the specially designed
dials and an inset info screen, its a
largely uncluttered and simple layout
something that is not always true of
Mercedes-Benz cars in recent years. Its
so simple that its crosshair air vents real-
ly stand out. The view too is dramatic.
The bonnet is vast.
The SLS is the first car to be built from
the tyres up by German tuners AMG, so
its hardly a surprise how good the car is
on track. With a powerful 563bhp V8
engine that drives the SLS from zero to
62mph time in just 3.8 seconds and on
to 197mph, its clearly a very fast car. But
thats really just academic. Its how the
SLS AMG does it that is so exhilarating.
The V8 engine sits within an all-new alu-
minium chassis and the cars weight is
distributed almost evenly. Combine this
with the rigid chassis and its wide
stance, and the car handles beautifully.
On the track it feels super reactive, the
steering direct. I feel more and more
confident as the day goes on. The seven-
speed automatic transmission has a dou-
ble clutch and is super quick, particular-
ly in Sports+ mode.
I love its aggression and I love the
hellish growl the engine makes and I
really love the doors. Its a car for super
heroes this, for great heroic days on
road or track and its as dramatic as
sports cars get.
THE VERDICT:
DESIGN hhhhh
PERFORMANCE hhhhh
PRACTICALITY hhhhi
VALUE FOR MONEY hhhhi
THE FACTS:
MERCEDES-BENZ SLS AMG
Price: 168,395
0-62mph: 3.8 secs
Top speed: 197mph
CO2 g/km: 308g/km
MPG Combined: 21.4 mpg
Sporty, expensive and
yet understated: the
Merc SLS AMG.
Lifestyle | Motoring
24 CITYA.M. 20 JULY 2011
WORDS BY
RYAN BORROFF
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SHERLOCK
BBC1, 8.30PM
Holmes and Watson investigate an
impossible suicide. Benedict
Cumberbatch and Martin Freeman
star. With Una Stubbs.
BOTHAM: THE LEGEND OF 81
BBC2, 9PM
A look back at Ian Bothams cricketing
career, marking 30 years since the
epic Ashes series that saw the former
all-rounder at the peak of his powers.
JO FROST: EXTREME PARENTAL
GUIDANCE CHANNEL 4, 8PM
Six-year-old Madisons parents turn to
the childcare expert as a last resort to
help them cope with their daughters
tantrums.
BBC1
SKY SPORTS 1
7pmLive Darts 12amTime of Our
Lives 1amSoccer AM: The Best
Bits 2amHow the 2011 ICC
Cricket World Cup Was Won 4am
FIFA Futbol Mundial 4.30am
Footballs Greatest 5am-6am
Soccer AM: The Best Bits
SKY SPORTS 2
4.30pmLive ECB 40 League
Cricket 10pmHow the 2011 ICC
Cricket World Cup Was Won
12amNFL: Total Access 1am
Poker 3am-4amBoots n All
SKY SPORTS 3
7pmInside the PGA Tour 7.30pm
European Tour Weekly 8pmPGA
EuroPro Tour Golf. The Cork Irish
Masters. 10pmCage Fighter
10.30pmBoots n All 11.30pm
Trans World Sport 12.30am
Inside the PGA Tour 1am
European Tour Weekly
1.30am-3.30amPGA EuroPro
Tour Golf
BRITISH EUROSPORT
5pmLive Under-19s European
Championship Football 7.05pm
Wednesday Selection 7.10pm
Wednesday Dossier 7.20pmShow
Jumping 9.20pmEquestrian
9.50pmRiders Club 9.55pm
Ladies European Tour Golf
10.05pmGolf Club 10.10pm
Sailing 10.40pmYacht Club
10.45pmWednesday Selection
11.15pm-12.45amCycling: Tour
de France
ESPN
7pmESPN Press Pass 7.30pm
Live German Football 8.45pm
Premier League World 9.15pm
Copa America Football 11pm
DTM Review Show12amPlanet
Speed 12.30amESPN Press Pass
1amPremier League World
1.30amLive Copa America
Football 3.45amESPN Kicks:
Extra 4amAsian X-Games 5am
ESPN Game of the Week
5.30am-6amESPN Press Pass
SKY LIVING
7pmCSI: Crime Scene
Investigation 8pmPsychic Sally:
On the Road 9pmNikita 10pm
Supernatural 11pmCriminal
Minds 12amCSI: Crime Scene
Investigation 1.50amGhost
Whisperer 2.40amCharmed
4.20amNothing to Declare
5.10am-6amMaury
BBC THREE
7pmDoctor Who 7.45pmGreat
Movie Mistakes 2: Sequel 8pm
Kellie: The Girl Who Played with
Fire 9pmJamie: Drag Queen at
16 10pmFILMAdulthood 2008.
11.35pmFamily Guy 12.20am
Jamie: Drag Queen at 16 1.20am
American Dad! 4.15amGreat
Movie Mistakes 2: Sequel
4.25am-5.25amKellie: The Girl
Who Played with Fire
E4
7pmHollyoaks 7.30pmHow I
Met Your Mother 8pmFriends
9pmRude Tube 10pmFranklin &
Bash 11pmAlan Carr 12.05am
My Name Is Earl 1.05amHow I
Met Your Mother 1.25amFranklin
& Bash 2.10amAlan Car 3.05am
Glee 3.50amHeartland 4.35am
The Class 5am-6amSwitched
HISTORY
7pmAmerica: Story of the US
8pmAx Men 10pmOnly in
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Mysteries 3amAmerica: Story of
the US 4amMega Disasters
5am-6amIce Road Truckers
DISCOVERY
7pmMythbusters 9pmAmerican
Chopper 10pmColdest Race on
Earth with James Cracknell 11pm
Dive to the Bottom of the World
12amBear Grylls 1amAmerican
Chopper 2amColdest Race on
Earth with James Cracknell 3am
Deadliest Catch 3.50amClash of
the Dinosaurs 4.40amWeird or
What? 5.30am-6amDestroyed in
Seconds
DISCOVERY HOME &
HEALTH
7pmBringing Home Baby 8pm
Little People, Big World 9pm
Untold Stories of the ER 10pm
A&E 11pmEmergency 12am
Untold Stories of the ER 1am
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People, Big World 4amA Baby
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Baby
SKY1
8pmThe Glee Project 9pmKylie
Live in 2011 Aphrodite Les Folies
11pmNext Door Nightmares
12amThe Chicago Code 1am
Danny Dyers Deadliest Men 2:
Living Dangerously 1.50am
Stargate Atlantis 3.20amDream
Lives for Sale 4.10amBite Size
Brainiac 4.20amAirline
5.10am-6amSell Me the Answer
BBC2 ITV1 CHANNEL4 CHANNEL5
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6pmBBC News 6.30pmBBC
London News 7pmThe One Show:
Best of Britain
7.30pmThe Great British
Weather: BBC News: Regional
News
8.30pmCHOICE Sherlock
10pmBBC News 10.25pm
Regional News 10.35pmNational
Lottery Draws 10.45pmNot Going
Out 11.15pmHim & Her: National
Lottery Update 11.45pmThe
Celebrity Apprentice USA 12.35am
Sign Zone: Bang Goes the Theory
1.05amCountry Tracks 2am
Richard Hammonds Engineering
Connections 2.50amRoyal Upstairs
Downstairs 3.20am-6amBBC
News
6pmEggheads
6.30pmGreat British Railway
Journeys
7pmRick Steins Spain
8pmTop Gear: Rowan
Atkinson takes the wheel of
the Reasonably Priced Car.
9pmCHOICE Botham: The
Legend of 81: A look back at
Ian Bothams cricketing career.
10pmNever Mind the
Buzzcocks
10.30pmNewsnight: Weather
11.20pmMade In Britain
12.20amThe Tudors
1.10amBBC News 3.20am-6am
Close
6pmLondon Tonight
6.30pmITV News
7pmEmmerdale
7.30pmThe Corrie Years
8pmLewis: Guest starring
Sophie Ward.
10pmITV News at Ten
10.30pmLondon News
10.35pmNatures Fury
Tornado: The destructive force
of twisters.
11.35pmHomes from Hell
12.30amThe Zone; ITV News
Headlines
2.30amFILMThe Nuns Story:
Drama, with Audrey Hepburn. 1959.
5.05am-5.30amITV Nightscreen
6pmThe Simpsons
6.30pmHollyoaks
7pmChannel 4 News
7.55pm4thought.tv
8pmCHOICE Jo Frost:
Extreme Parental Guidance
9pm24 Hours in A&E
10pm8 Out of 10 Cats Uncut
10.50pmChannel 4 Presents
Stephen Miller 2012
10.55pmThe Killing 11.50pm
Music on 4: Live from Abbey Road
12.40amMusic on 4: The Album
Chart Show: Spotlight 12.55am
Music on 4: The Crush 1.50am
FILMThe New Age: 1994. 3.40am
Hill Street Blues 4.30amOne Tree
Hill 5.15am-6amCountdown
6pmHome and Away
6.25pmOK! TV
7pm5 News at 7
7.30pmGarden ER: 5 News
Update
8pmThe Removal Men
Pickfords: 5 News at 9
9pmNCIS
10pmFILMThe Man Who
Sued God: 2003.
12.10amPoker: Aussie Millions
1.05amSuperCasino. Live
interactive gaming. 4amMeals in
Moments 4.10amMichaelas Wild
Challenge 4.35amMichaelas Wild
Challenge 4.55amRough Guide to
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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
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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 Very dry (4)
3 Control board (5)
6 Bowling period in the
game of cricket (4)
7 Dandy (4)
9 Change the order of (9)
12 Got together (3)
14 Ventilate (3)
15 Girls name (9)
16 The 21st letter of the
Greek alphabet (3)
17 Units (1/6 inch) used
in printing (3)
19 Arm of the
Mediterranean (6,3)
21 Letters on an
invitation to request
a response (inits) (4)
22 Independent ruler
or chieftain (4)
23 Former King of
Judea (5)
24 Disgurement (4)
DOWN
1 Book for collecting
stamps (5)
2 Glowering, moody (4)
3 Gifts (8)
4 Regions that are
dangerous or impossible
to enter (2-2,5)
5 Light-beam
intensier (5)
8 Cancellation of
civil rights (9)
10 Pacied, placated (8)
11 Former name of
Thailand (4)
13 Nymph who fell in love
with Narcissus and
faded away, leaving
just her voice (4)
16 Squeeze with the
ngers (5)
18 Fabulous, wonderful! (5)
20 Makes a mistake (4)
R
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4

4


4

4
A G E I S M L S
I M A S H R A M
R E A P E D A L
W C M E A S L E S
A L I B I N A O M I
V A G I N Y D
E S T E R O H A R E
S C E N E R Y L R
R R A S P I R E
F A M O U S S A
M L P I S T I L
2 6 4 9 3 7 9
3 9 6 1 4 2 2 4
1 4 2 8 4 9 6 7
6 8 7 9 1 6 4
3 1 9 2 1 3
1 7 4 2 8 6 5 3 9
2 6 9 5 2 1
9 8 7 1 3 5 2
3 4 1 5 2 8 9 6
6 8 8 5 1 7 6 4
1 3 9 8 7 8 1
4
4
4
4
4
4
4
4
4
WORDWHEEL
The nine-letter word was
STRATAGEM
25
SPORT | IN BRIEF
Hushovds on the money
CYCLING: World champion Thor
Hushovd pipped Edvald Boasson
Hagen to beat the Team Sky rider
and claim his second stage win in
the 2011 Tour de France.
Frenchman Thomas Voeckler kept
hold of the yellow jersey, but
Australian Cadel Evans and three-
time winner Alberto Contador
both made significant gains.
Welsh cyclist Geraint Thomas has
signed a new deal at Team Sky.
Waugh wants lie detectors
CRICKET: Former Australia cap-
tain Steve Waugh believes lie
detectors would help remove the
stain of match fixing from the
sport. Waugh has undergone a
polygraph examination and said:
Anybody with something to hide
would be found out by this
process.
Rovers pull out of India tour
FOOTBALL: Blackburn have opted
out of their proposed pre-season
tour of India amid security fears
following last weeks terrorist
attack in Mumbai. Rovers, owned
by Indian poultry firm Venkys,
were due to appear in Pune and
become the first Premier League
team to play in India, but will now
reschedule.
Froch sets Ward date
BOXING: Britains Carl Froch has
confirmed he will fight American
Andre Ward in the final of the
Super Six boxing classic on 29
October in Atlantic City. Froch, 34,
will defend his WBC super-mid-
dleweight title against the unbeat-
en Ward.
Higgins admits frustrations
SNOOKER: World champion John
Higgins admits he must knuckle
down after his shock first-round
defeat at the Australian Open
against Matthew Selt.
ENGLAND spinner Graeme Swann
cant wait to finally get down to the
serious business of the summer and
wrestle the No1 Test ranking from
Indias grasp.
The visit of a limited Sri Lankan
side represented a low-key start to
Englands summer campaign in a
series heavily disrupted by the weath-
er.
India, crickets current world super-
power with a team decorated by the
presence of several all-time greats,
will offer a far sterner challenge of
Englands metal during the course of
an eagerly anticipated four Test series
which starts at Lords tomorrow. But a
typically bullish Swann (right)
believes there is no need for England
to suffer from an inferiority complex.
Im looking
forward to
everything
about it,
its a huge
game it
feels like the
s u mme r s
finally arrived, said
Swann. They have got a
very good batting line-up but Id
argue whether they are the best in the
world at the minute because I think
our top six might be.
Swanns own meteoric rise from
county trundler to the worlds pre-
mier spin bowler has added an extra
dimension to an England attack
which ranks as the most balanced and
penetrative on the Test circuit.
Swann will come face-to-face with
Duncan Fletcher, the man who
ignored his credentials for seven years
at the expense of the more defensive
Ashley Giles, recently appointed
Indias coach.
But Swann believes the man who
masterminded Englands 2005 Ashes
winning campaign did him a favour
by casting him into the international
wilderness.
Swann said: I
thank Duncan
Fletcher because had
I played badly I would
have ended up playing
one or two Tests and
forgotten for ever.
So the seven years I
spent out of inter-
national cricket
didnt harm me
whatsoever.
MANCHESTER CITY manager
Roberto Mancini believes a bid
for Argentina striker Sergio
Aguero is imminent.
The Atletico Madrid hitman
is viewed as the ideal candi-
date to fill the void likely to be
created by Carlos Tevezs move
to Brazilian club Corinthians.
Asked whether a firm offer
had been made for Aguero,
Mancini replied: Maybe in
the next few days. I have not
spoken to anyone about it, but
probably. I think so. Aguero
has already stated he was
planning to decide upon his
future this week as he pre-
pares to return to Spain fol-
lowing Argentinas Copa
America exit.
Meanwhile, the Tevez saga
with Corinthians continues,
as both clubs continue talks
over a plus 40m deal.
I slept last night and I had
a game to prepare for so I
dont know any more,
Mancini said on Tevez, follow-
ing Citys 2-1 win over
Vancouver.
City step up campaign to
replace Tevez with Aguero
FOOTBALL

BARCELONA manager Pep

Guardiola is willing to wait
until the dying embers of the
transfer window to force
through the transfer of
Arsenal captain Cesc Fabregas.
Arsenal boss Arsene Wenger
has publically expressed a
desire to retain the Spaniards
services but his counterpart at
Barcelona revealed the north
London clubs resistance is
lessening and is hopeful
Fabregas will finally rejoin the
club he left as a trainee this
summer, even if it means hold-
ing out until the 31 August
deadline.
Arsenal have agreed to
negotiate and we will try to
reach an agreement, he said.
There is money set aside
and until the last day we will
try to bring in Cesc.
I hope that something can
be sorted. Until August 31
there is time, but at times
things dont always work out.
FOOTBALL

India hold no
fears for us,
insists Swann
BY JAMES GOLDMAN
CRICKET

Barca will fight until

the end for Fabregas
Keri-Anne Payne
is the first Briton
to book her place
at London 2012
Picture: GETTY
Sport
26
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email sport@cityam.com
SWIMMER Keri-Anne Payne has
admitted her massive relief after
becoming the first British athlete in
any discipline to guarantee their
place at London 2012.
The 23-year-old from Stockport
ensured her qualification by defend-
ing her 10km open water title at the
Fina World Championships in
Shanghai yesterday.
Payne said: I really wish I could
swear right now but I am not that
kind of person. It feels amazing, Im
just so happy with myself for doing
that.
To be on that Olympic team at a
home Olympics is going to be
absolutely amazing. Im really
pleased.
Its a weight off my shoulders.
There is a massive sense of relief. I can
concentrate on training now for next
year and I dont have to worry about
qualifying because Ive already done
it.
Paynes victory, a repeat of her suc-
cess in Rome two years ago, earned
Britains first medal of the champi-
onships. She herself could add to that
tally in the pool, where she will com-
pete in the 1,500m and 4 x 200m
relay.
British Olympic Association chief
executive Andy Hunt led the tributes
to Payne, saying her qualification for
Team GB was a case of one down,
around 549 to go.
Hunt added: Keri-Annes outstand-
ing performance to win gold is a ter-
rific personal accomplishment and
the Olympic qualification represents
a significant milestone on the road to
2012 for Team GB.
Payne hit the front straight away at
Jinshan City Beach, hotly pursued by
Australian Melissa Gorman and 2010
Open Water World Champion
Marianna Grimaldi.
She saw off a challenge from
Gorman on lap three of four, and had
enough in reserve to similarly thwart
Italian Grimaldi in the closing stages.
Paynes success ensures she faces
greater expectations of more gold
nest summer in London.
She said: Im sure there will be
added pressure on me going into the
Olympics but Ill just work on that
coming into it. Im definitely going to
have a target on my back but well see
how it goes.
Fellow Briton Cassie Patten fin-
ished 21st, missing out on the top 10
spot needed to qualify for the Games.
Payne wins gold
and a 2012 place
BY FRANK DALLERES
OLYMPICS

WITH just a year to go before the

London Olympics encouraging new
figures reveal that the anticipated
final cost of the Olympic Delivery
Authoritys construction programme
has fallen to 7.25bn and is likely to
come in 850m under budget.
Sports and Olympics minister Hugh
Robertson claimed the figure, a 16m
reduction on the previous quarter,
showed that construction work was
progressing at a pleasing rate.
With one year to go to London
2012, the Games construction is 88
per cent complete and ahead of time
and under budget, Robertson said.
Once the Olympic venues are com-
pleted the focus will turn to furnish-
ing and fitting them out, a
responsibility that will fall on the
shoulders of the London Organising
Committee of the Olympic Games,
chaired by Lord Coe.
The teams at Locog are now con-
centrating on finalising our plans to
stage the Olympic Games we are
about half way through our own pro-
curement programme and there are
lots more opportunities for British
business to be part of the greatest
show on earth, said Coe.
Olympic preparations boosted by
major reduction in building costs
OLYMPICS

WEST HAM have signed a

three-year sponsorship deal
with Alpari (UK) Limited a lead-
ing foreign exchange broker.
The deal includes the renam-
ing of the West Stand at Upton
Park to the Alpari Stand. Barry
Webber, West Ham United
Commercial Director, said:
This shows West Ham are still
an attractive proposition to
prospective partners.
New foreign
signing for
Hammers
FOOTBALL

2008: Wins silver medal at Beijing

Olympics in the 10km marathon swim,
2009: Wins gold medal in 10km at the
World Championships in Rome
2010: Wins bronze in 400m individual
medley at Commonwealth Games in Delhi
2011: Confirms London 2012 place by
winning 10km at World Championships in
Shanghai
PAYNES PROGRESS | KERI-ANNES CV
27
CHELSEA captain John
Terry believes the poten-
tial signing of Tottenham playmaker
Luka Modric would significantly
enhance his clubs chances of regain-
ing the Premier League title.
Modric has been the subject of two
failed sub 30m bids this summer
from the west London club with Spurs
adamant that the Croatia playmaker
will remain at White Hart Lane and hon-
our the five-year contract extension he
penned last summer.
But Terry, currently with the rest of
his Chelsea team-mates in Kuala Lumpar
as the Blues embark on the start of their
four-game pre-season tour, is hopeful a
deal can be struck.
Hes very agile, very quick and a
great finisher like weve seen over
many years, said Terry. Hes a world
class player who is very difficult to
play against. I know there
are problems. Its proba-
bly a little bit disre-
spectful towards
Spurs. He has his own
problems at the
moment.
Weve got a good
squad of players. If he
comes he could certainly
add to that.
Terry has also been
impressed by the sharpness of
Fernando Torres in the early
weeks of pre-season. The Spaniard
scored just once following his
50m British record trans-
fer in January, but Terry
expects a much better return
from him this time around.
Terry (right) said: He backs himself.
He feels fresh, hes happy.
Hes fully settled. Im certainly look-
ing for him to get double figures goals
wise this season.
BY JAMES GOLDMAN
FOOTBALL

Terry hoping world class

Modric will join Chelsea
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