The Business: Tuesday June 17 2014
Company news, markets and financial talking points, available from 8am Monday to Friday
The Tories should promise to abolish corporation tax for all small businesses, says the party chairman. Writing in the Daily Telegraph, Lord Saatchi calls on the government to make the pledge to allow firms to “challenge cartel capitalism”. He writes that the policy would show “how the awesome power of taxation can be used to the benefit of everyone” and describes his proposed measures as a “call to arms” for the Conservatives.
A pricing error caused shares in Sir Philip Green’s Australian online fashion firm to plunge on its London stock market debut. A misplaced decimal point listed the MySale shares in pounds rather than pence. On trading screens this meant its 226p price appeared as 2.26, which sparked automatic selling of the stock. The company said that the quote will be changed to pence for trading today. MySale is a flash sale website, which sells sale items to its 10.8m members over a limited time scale.
An early rise in interest rates was all but confirmed yesterday when the most doveish Bank of England policymaker said he expects to vote for an increase by May. The Times reports that David Miles, an external member of the Monetary Policy Committee, hinted that the minutes of this month’s rate-setting meeting, to be published tomorrow, would show that the committee was moving closer to ending five years of policy at a record low 0.5%.
Philip Clarke is under new pressure at Tesco after the retailer’s credit rating was cut once again by Moody’s. The Daily Telegraph reports that Moody’s downgraded the struggling supermarket’s credit rating to just two notches above junk status. The cut, from Baa2 from Baa1, came after a 6% drop in the company’s 2013-14 trading profit and weak first quarter sales this year. Moody’s said it expects “increasingly difficult conditions” to continue to affect Tesco for up to 18 months.
The International Monetary Fund has cut its US growth forecast, reports the BBC. The IMF is urging policy makers to keep interest rates low and raise the minimum wage to strengthen its recovery. It says it expects 2% growth this year, down from its April forecast of 2.8%, after the "harsh winter" prompted a weak first quarter. The IMF argued a rise in the minimum wage would raise incomes for “millions of working poor”.
FTSE-100: down -0.34 to 6754.64
Dow Jones: up +0.03 to 16781.01
Dax: down -0.29 to 9883.98
Cac-40: down -0.02 to 4510.05
Nikkei: up +0.25 to 14969.99
Hang Seng: down -0.49 to 23185.81
US dollar: buys €0.73730 and £0.58890
Sterling: buys $1.69780 and €1.25200
Oil: $112.96 up +0.4