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More imports and fewer exports
A recent announcement from the Office for National Statistics (ONS) stated that Great Britain's trade gap for goods only fell to £7.367billion in December 2008 from a record £8.114 billion in the previous month. Before we begin to crack out the champagne, it is important to report that the gap was largely due to a 2.5% fall in imports and only by a half percent increase in exports. Financial experts point out that the decrease in imports was due to the weak pound.
Provisionally estimates are that the trade deficit for 2008 will be £93.2billion, up almost three billion pounds when compared with £89.3billion in 2007.
Yesterday witnessed some embarrassing cringing from fallen stars of the banking world, Sir Fred Goodwin former chief executive and Sir Tom McKillop, chairman of the Royal Bank of Scotland (RBS) and Andy Hornsby former chief executive and Lord Stevenson of Codename, chairman of the HBOS group. They queued up to express their "regret and remorse" for having led their banks to the brink of collapse when they appeared before the Treasury Select Committee on Tuesday. Looking suitably humble and subdued the mixed pairs presented to the Committee with detailed explanations of why their banks failed and they were forced to resign their top flight positions.
The largest mobile phone company In Europe, Vodafone announced their intention to merge its Australian business with that of Hutchison Whampoa, the Hong Kong conglomerate behind the three brands. The 50-50 deal has sparked further speculation of a tie-up between Vodafone and three in the UK. The U.K.’s second-biggest phone company Cable and Wireless Plc scheduled to publish earnings saw their shares rise 1.2 percent (1.9 pence to 163.8 pence.)
Europe’s largest drug manufacturer, GlaxoSmithKline announced that they will now focus on developing a sustainable flow of medicines, rather than actively trying to find high earning but risky “blockbuster” drugs. The market shows that they were no impressed allowing stocks to fall two percent on the day's trading (24.5 pence, to 1,233.5 pence.)
The U.K.’s largest defense- research company Quinetig Group, scheduled to publish earnings this week saw their stock fall by 1.1 percent (1.75 pence to 163.25 pence.)
Meanwhile, the U.K.’s third- largest gas producer BG Group Plc placed an offer to buy the Australian based Pure Energy Resources company for around eight hundred million Australian Dollars, (about 400 million pounds sterling. )
With the acquisition, the U.K. Company announced their intention to expand its liquid national gas interests to compete with BP and Total SA for the third-largest producer of LNG in the World slot, behind Exxon Mobil and Shell. Shareholders didn't share their sentiments at the outset with shares falling slightly by 0.8 percent (9 pence to 1,076 pence) in London trading.
The FTSE 250 index fell by 0.21% or 193.90 points to 6481.76 while the FTSE 100 finished the session down a modest 0.45 per cent, or 18.75 points, higher at 4,194.33
Sterling remained stable against the US Dollar and the Euro and rose slightly against the Japanese Yen and the Swiss Franc:
- Pound/Japanese Yen 129.93
Wall Street shares had a bad day on the announcement of President Obama's new bail- out program.
The Dow Jones Average dropped 381.99 to close at 7888.88, whilst NASDAQ fell 66.83 points to 1524.73
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