Tuesday October 13

The latest news from The City at 8am, plus a US business update landing at 4pm

Volkswagen to cut €1bn a year in wake of scandal

Embattled car maker Volkswagen has announced it will cut around €1bn in annual costs in the wake of the global emissions scandal, as it braces for a spate of fines and litigations. The Daily Telegraph says the company, which has admitted 11 million cars cheated on diesel emissions tests, has also recast its product development priorities to focus on new, cleaner diesel engines and electric cars. 

Oil glut to persist through 2016

Oil traders hoping to see more evidence that the market is rapidly correcting persistent oversupply have been dealt a blow, after the International Energy Agency released its latest set of bearish forecasts. It said weaker global growth predicted by the IMF would weaken demand and that production falls in America would be largely offset by a surge in exports from Iran. As such, the glut will go on through most of 2016, the Wall Street Journal reports.

Twitter to cut 8% of staff

Twitter's new chief executive Jack Dorsey has written a letter to staff confirming that the company will cut 336 roles, accounting for 8% of its workforce. CNBC notes the company is currently restructuring its engineering department to make it more efficient, as it seeks to respond to investor disappointment over its sluggish new user growth.

Coke and Pepsi battle it out for yoghurt maker

Coca-Cola and PepsiCo are both in talks with US greek yoghurt maker Chobani over an investment that Reuters says could value the company at around $3bn. The two drinks giants are both seeking to diversify away from the slow-growth carbonated beverage sector, which is struggling amid a healthy-eating trend. Other potential investors are also thought to be involved in discussions. 

Quote of day... bank governance is 'dysfunctional'

"Does this mean corporate governance in the financial sector has become dysfunctional? Very probably." The Financial Times' John Plender laments the findings of a study that suggests bank chairmen are only marginally more experienced than they were pre-crisis. He specifically criticises rules that force banks to appoint executives who are "independent", which he claims is "an overvalued virtue".

Worldpay raises £2.5bn in listing

Payments processing firm has fixed the price of its listing on the London Stock Exchange at 240p, the FT reports. The company, which was formerly owned by Royal Bank of Scotland, is raising £2.5bn in an offer than values the business at £6.3bn, including debt. The stock, which will float in December, rose to 252p in early conditional trading.


FTSE-100: down 1.03% to 6305.67 Dow Jones Futures: down 0.66% to 16928
Dax: down 1.72% to 9946.19 
Cac-40: down 1.70% to 4608.98 
Hang Seng: down 0.57% to 22600.46 Nikkei: down 1.11% to 18234.74 
US dollar: buys €0.8781 and £0.6572
Sterling: buys $1.5215 and €1.3361
Oil: $49.71 down 0.30%