Bank of England: MPC members express a variety of views
Retail sales jump 6.9%
What does it mean for interest rates? - experts have their say
Threadneedle backs AstraZeneca board..
..but L&G 'write to Astra' demanding Pfizer talks
2.40pm BST
Axa Investment Managers has become the latest to come out against AstraZeneca's rejection of the £55 a share Pfizer bid.
Axa owns 4.5% and is the third biggest shareholder in Astra. Jim Stride, director and head of UK equities, said:
AXA Investment Managers UK, acting in accordance with its fiduciary duty to clients, has met with the management teams of Pfizer and AstraZeneca in the recent past. We have also engaged in ongoing written and verbal communication.
It is the view of AXA IM UK that the board of AstraZeneca should not prevent an offer from Pfizer of £55 per share from being put to the shareholders of the company. Many shareholders but not necessarily all will find this an attractive offer. Accordingly we believe that the board was arguably wrong and acted too hastily to dismiss the latest proposal from Pfizer.
2.20pm BST
Saga has cut its flotation price range following the closure of the retail offer on Tuesday.
The company, which provides insurance and holidays for the over-50s, said the range would now be 185p to 245p a share, compared to the original top end of 245p. This is apparently to support "a strong debut."
Here is that Saga "double speak" in full. Demand is so strong ... we have cut the potential price pic.twitter.com/zo0ptL1VXC
We have seen a fairly significant fall on our grey market Saga has gone from a valuation of £3.25bn to around £2.4bn in the space of a week. This is not so much a reflection of concerns over Sagas attractiveness as an investment, but more an issue around the number of shares on offer.
Based on the 1.07bn shares due to be issued, according to the listing documents, and on the assumption that all shares are equal, on Capital Spreads current spread the share price would be between 210p and 238p at the end of the first days trading.
Saga narrows IPO price range to 185-205p. A listing at 205p would value company at £2.19 billion. Latest GM quote 222.5/237.5 AM #SagaIPO
1.55pm BST
Reuters has polled City economists and found that the "vast majority" believe the European Central Bank will cut its headline borrowing rate to a new record low of 0.1% at its June meeting.
Most also expect the ECB will impose negative interest rates on European banks, by cutting its deposit rate from 0.0% to -0.1%.
* Reuters poll-european central bank seen cutting refinancing and deposit rates at June 5 meeting
1.24pm BST
Another day, another recall at General Motors.
Associated Press is reporting that GM has added 218,000 subcompact cars to its growing list of recalled vehicles -- to fix a glitch that could lead to a fire.
The new recall covers certain Chevrolet Aveo cars from the 2004 through 2008 model years. GM says the daytime running light module in the dashboard center stack can overheat, melt and cause fires.
Breaking: General Motors recalls 218,000 Chevy Aveo models for potential fire hazard: http://t.co/SJtoJf00ka $GM
1.11pm BST
Today could be dubbed Minutes Wednesday - with the US Federal Reserve releasing the notes from its own monetary policy committee meeting later today (7pm UK time, or 2pm New York).
The FOMC minutes will give fesh insight into when US borrowing costs might rise.
#FOMC minutes the headline event at 1900BST/1300CDT. RANsquawk preview here http://t.co/LBc3BprYkF and vid here http://t.co/hud8LHGQgI
12.53pm BST
After almost a year, Mark Carney's honeymoon at the Bank of England is well and truly over, with senior policymakers prepared to disagree over how to tackle monetary policy.
The minutes of this month's meeting show MPC members had the resolve to express "a variety of views on the appropriate path of monetary policy".
A ten-month unconditional love-in with the new Bank of England governor appears to have been all Britains independent rate-setters could stomach. The unity of the nine-strong Monetary Policy Committee is finally beginning to crack.
The fact that there is a real debate once again over the most critical policy instrument in the UK should be celebrated.
12.27pm BST
Here's economics editor Larry Elliott's take on this morning's strong retail sales figure:
Britain's retailers are enjoying their best trading conditions for a decade after low interest rates, rising confidence, a booming housing market and a late Easter boosted spending in the shops and online last month....
12.18pm BST
The cutbacks in Britain's banking sector continues --with Lloyds eliminating another 645 roles in the UK and closing its Warrington telephone banking centre.
The Unite union warns that staff morale could hit an 'all-time low', as this is the third round of job losses in 2014. It urges Lloyds to avoid compulsory job losses.
The closure of the Warrington centre will hit the local economy and risks damaging customer service.
Lloyds staff have worked hard since it was bailed out by the taxpayer to make the bank a success. Their reward has been continual uncertainty and attacks on their pensions.
Unite says Lloyds is axing 645 jobs which the union argues could damage customer service as includes closure of call centre in Warrington
12.08pm BST
The Wall Street Journal has now published the story about how Legal & General has written to AstraZeneca to call for fresh talks with Pfizer (as flagged at 11.31am).
AstraZeneca sixth-largest investor, Legal & General Group PLC, is urging the U.K. drug giant's board to reverse its rejection of a $120 billion takeover offer from Pfizer and engage in talks, two people familiar with the situation said.
The investment arm of the U.K. insurer, which holds a 3.5% stake in AstraZeneca, has written to the company's board asking it to engage in talks with Pfizer, one of the people said. Legal & General declined to comment. AstraZeneca declined to comment on individual shareholder interactions but said it is continuing to engage in general with its investors.
11.59am BST
After years of relative tedium, the Bank of England's monthly monetary policy committee meetings are going to be a lot more exciting as pressure grows to raise rates.
Martin Beck, senior economic adviser to the EY ITEM Club, says there are "emerging signs of disagreement in Aprils meeting" in today's BoE minutes.
The debate on interest rates looks set to become more heated. According to the latest minutes of the MPC, while the Committee remained unanimous in favour of keeping policy of hold, there were a variety of views on the appropriate path of monetary policy. For some members the decision to keep rates unchanged was becoming more balanced.
That said, with prospects for inflation looking very benign and the economy, in our view, possessing a significant amount of spare capacity, we still think that a rate rise will not happen until well into 2015."
11.31am BST
AstraZeneca shares have leading the FTSE 100 risers, gaining 1.8% this morning to £43.83.
The trigger appears to be a report that one of Astra's biggest shareholders, Legal & General, has written to the company's board urging them to re-open talks with Pfizer over its £55 per share offer.
$AZN $PFE - *DJ Top-10 AstraZeneca Holder Legal & General Writes Letter Backing Talks-Sources
Dow Jones reporting that Top 10 AstraZeneca shareholder Legal & General has written to the board urging them to talk to Pfizer.
#AstraZeneca shares picking up - it ain't over till its over
@AngryArb has anyone seen a copy of the letter? L&G aren't confirming as yet..
11.02am BST
There's masses of reaction to the surge in UK retail sales last month, and the evidence that some Bank of England policymakers are inching towards raising interest rates.
Many experts are pondering what its means for borrowing costs - when will rates be risen above the 0.5% record low?
With the growth story broadening out we are getting closer to a rate rise from the Bank of England. Our house view remains that the first hike will probably come in February, but given the strength in growth, employment and asset prices the risks are skewed towards a slightly earlier move.
If we see wages growth pick up note the impending 3% rise in national minimum wage and the increase in reported pay awards then we would be more inclined to bring it forward.
Retail sales posted an exceptionally strong 6.9% yoy growth rate in April. That was obviously distorted by the timing of Easter, so the growth rate will drop back sharply next month.
But the reading was way ahead of consensus expectations. These data support our forecasts for above consensus growth and a first rate hike coming in the first quarter of 2015. We see a 35% chance that the BoE hikes in the fourth quarter of 2014.
The UK economy is motoring, fuelled for now by consumption, and the BoE rate setters are shifting their views in response.
UK Retail Sales have yet again beaten expectations with a month-on-month jump of 1.3%, far exceeding the forecast of 0.4%.
All stores except petrol stations have seen an increase in sales with April 14 showing an increase of 6.9% from April 13. With UK house prices continuing to rise and CPI starting to accelerate, the MPC may be forced to bring forward an interest rate rise to Q4 2014.
At this rate we'll have a UK rate rise in February
Bank won't do it without latest inflation report. November would be too soon.
Traders have been betting that the BoE will be forced to raise interest rates sooner than expected, as the economic growth begins to pick up pace and to cool a potential property bubble.
The outlook for monetary policy is starting to look a lot more uncertain, with the minutes of the May MPC meeting indicating that opinions within the committee are diverging on about exactly when monetary policy should start to be gradually tightened. There are clear indications in the May minutes that some of the more hawkish MPC members are starting to get twitchy.
The longer-term message from the Bank of England remains that when interest rates do start to rise, the increases will be gradual and limited, but when exactly the first increase comes is far from clear.
10.40am BST
As recriminations fly over Pfizer's failing bid for AstraZeneca, one of the UK drugs firm's larger shareholders has told the Guardian that they still support Astra's top management.
Iain Richards, head of responsible investment at Threadneedle Asset Management, said:
"As long-term shareholders we continue to be supportive of the AstraZeneca board".
10.21am BST
Britain's retailers have just enjoyed their strongest quarterly growth in a decade, according to the detail in today's retail sales figures.
Notably the food sector posted its strongest year-on-year growth since January 2002, increasing by 6.3%. Feedback from food store retailers suggested that a better than expected Easter and better weather conditions helped to boost sales.
10.08am BST
Analysts at Berenberg reckon that today's minutes play a different tune than the Bank of England governor sang at the quarterly inflation report last week:
Very strong UK retail sales and more hawkish BoE minutes. Contrasts with Carney's dovish words last week. Seems some of MPC disagree.
9.59am BST
Today's Bank of England minutes show that some members of its rate-setting Monetary Policy Committee are looking at the strong recovery and wondering if it's nearly time to raise interest rates.
It could be argued that the more gradual the intended rise in Bank Rate, the earlier it might be necessary to start tightening policy. Against that, if productive potential were in part related to the level of demand, then the earlier policy was tightened the greater the risk of incurring a substantial cost in foregone output.
Committee members placed different weights on these considerations and this was reflected in a variety of views on the appropriate path of monetary policy. The Committee would continue to refine its views as the economy evolved, and for some members the monetary policy decision was becoming more balanced.
9.43am BST
This chart shows how the pound just jumped against the US dollar, driven by the jump in retail sales, and the news that some Bank of England policymakers are moving closer to voting to raise interest rates.
The UK Pound £ is doing the job of the dithering Bank of England for it as it passes US $1.69 and applies disinflationary pressure #GBP
9.39am BST
UK retail sales have surged in April, and by more than expected, in another signal that the British economy remains strong.
Retail sales volumes jumped by 1.3% last month alone, twice as much as economists had forecast, driven by robust food sales over the Easter holidays.
9.35am BST
The pound has jumped, hitting a two-week high of $1.6922 against the US dollar.
And it hit a new 16-month high against the euro, of 81.03p.
9.31am BST
The Bank of England's Monetary Policy Committee voted 9-0 to leave interest rates at their record low of 0.5% at this month's meeting, minutes just released show.
But some members believed the decision on when to raise rates is "becoming more balanced" - a sign that some MPC members are turning more hawkish about the need to raise borrowing costs.
9.27am BST
The dividend paid to SSE shareholders has been rising steadily over the last 15 years, flags up Emily Gosden of the Telegraph.
Indeed. it's more than tripled -- from 25.7p in 1999 to 86.7p for last year.
SSE's dividend growth chart is quite something. pic.twitter.com/gURCZrA7Lu
SSE claims price rise nowt to do with profit rise. But without price rise, retail profit would've fallen further & group profit risen less.
9.21am BST
Nearly time for the latest Bank of England minutes, and the retail sales figures for April, at 9.30am.
Kit Juckes of Société Générale reckons retail sales picked up last month, partly due to the Easter holidays:
The late timing of Easter caused UK retail sales to be weak in March. So a rebound in April is likely. We're looking for a 0.6% bounce and for a lack of thrills from the MPC Minutes.
9.16am BST
Shares in French bank BNP Paribas have slipped 2% this morning, on reports that it's about to feel the full wrath of US regulators.
Bloomberg is reporting that US authorities are planning to impose $5bn in fines, and a temporary ban on transferring money in and out of America, for violating US sanctions.
8.59am BST
Back on SSE's results, and the Press Association has focused on the drop in retail profits at the energy supplier:
Energy giant SSE today said annual profits from its energy supply arm fell by nearly a third and are unlikely to recover for two years after it announced a price freeze.
Operating profits from the business dropped by 32.2% to £246 million though the wider group saw adjusted pre-tax profits rise 9.6% to £1.55 billion.
8.55am BST
It's the end of an era at Carpetright.
The UK flooring firm's (very) long-serving executive chairman, Lord Harris, is stepping down this summer, after more than half a century in carpet retailing.
"I will be 72 this year and shareholders will be aware that I have been planning a managed hand-over of my responsibilities for some time.
8.46am BST
Heads-up for eurozone crisis watchers - the FT's Peter Spiegel is about to discuss his brilliant series on how the euro was saved, on Radio 4. You'll be able to hear it later on iPlayer (could be tricky if you're not in the UK, though)..
Not fully awake yet? I've got solution: my grating American accent on @BBCRadio4 in 10mins talking about recent @FT series on #eurocrisis
8.43am BST
SSE's 9.6% jump in profits (despite that drop in retail earnings) haven't caused any alarm in the City -- where shares have dipped just 0.3%, or 6p, to £15.60.
And Burberry's record profits have also gone down well - shares are up 0.6%
8.36am BST
Burberry's new boss, Christopher Bailey, has begun his stint at the top of the fashion industry by reporting record profits for the last year, up 8% rise in line with expectations.
As we enter a new chapter, our teams are united and energised by the opportunities ahead - from unlocking Japan, to accelerating Beauty and further integrating the physical and digital to deliver distinctive experiences.
8.17am BST
SSE has hiked the dividend it pays to shareholders by 3.0% -- part of its policy to raise dividends at least as fast as inflation.
But it warned that future earnings face several risks, including:
SSE ups the dividend but warns that potential Labour price freeze "could place a greater risk" on future earnings for shareholders.
8.10am BST
SSE's chairman Lord Smith insists that his company is part of the solution, not the problem, in the energy sector - after growing profits by almost 10% in the last year:
"SSE is listening to and helping customers with the longest ever household energy price freeze in the Great Britain market;we have well-defined plans for net investment of around £5.5bn over the next four years in maintaining, upgrading and building the electricity assets customers depend on; and we are committed to giving investors a fair return through an annual dividend that at least keeps pace with inflation.
"The issues facing the energy sector are very challenging. Nevertheless, customers, investors, regulators, politicians and SSE all want the same thing: an energy market that works for customers, and is trusted and seen to do so. We believe SSE is not part of the problem but part of the solution to meeting the energy needs of customers in Great Britain and Ireland."
8.04am BST
Energy firm SSE has reignited the debate over the state of Britain's energy sector by posting a 9.6% surge in profits for the last financial year.
SSE, one of Britain's "Big Six" suppliers, made adjusted pre-tax profits of£1.55bn for the year to 31 March compared with £1.4bn a year earlier.
SSE group profits up 9.6% to £1.5bn as retail price hike last Nov helps. Interesting 48% gain from regulated (?) electricity transmission.
Energy supplier SSE reports 9pc rise in adjusted pre-tax profits of £1,55bn - a reflection of the underlying profits of the business
8.02am BST
Good morning, and welcome to our rolling coverage of the financial markets, the world economy, the eurozone and business.
Coming up today -- the minutes of the Bank of England's last monetary policy meeting will show whether any rate-setters are considering raising interest rates, in the face of a growing economy and hefty house price rises in London.
get your resumes out: samaras vowed 770,000 new jobs by 2020. which, by then, shd be roughly the size of the remaining labor force. #greece
#Greece #EP2014 RT @jodi2014: This is what #Samaras promised before the 2012 elections http://t.co/P3KKueweOw pic.twitter.com/KlLBmJ3jhZ
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