Flying FTSE
Five-year high
The enfeebled state of the UK economy is not holding back its blue-chip equities index after the FTSE 100 registered a five-year high this week by punching through the 6,500 level. The FTSE has taken its lead from US indices, which have set new record highs of late and been further boosted by improving US economic data, fuelled by the shale gas boom. But there are concerns over the ability of the US economy to maintain its growth and job creation momentum as sequestration kicks in. Meanwhile, appetite for more cuts from the Republican side of the political divide in the US was illustrated this week when former vice-presidential candidate Paul Ryan unveiled a $4.6trn 10-year spending cuts package aimed at balancing the budget within that time scale.
SFO probe
Autonomy target
UK software business Autonomy, which was acquired for $11bn by Hewlett Packard in 2011, could face a probe from the Serious Fraud Office following the handover of the results of an internal enquiry conducted by Hewlett Packard into its acquisition. Hewlett Packard wrote down $8.8bn in its accounts in November citing serious accounting irregularities at Autonomy. But there is a potential twist to the tale in that the Serious Fraud Office could yet be precluded from carrying out its investigation if a conflict of interest is proven regarding its use of Autonomy document management software. A review is under way.
Housing hope
Demand picks up
The nascent recovery in the UK housing market looks to be gaining some traction. The latest Royal Institution of Chartered Surveyors report on the sector showed the number of housing transactions hit a two-and-a-half year high in February, with surveyors reporting an average 16.8 transactions during the month, although this remains well down on the levels recorded during the property boom of the mid-to-late 2000s. Some credit must be given to the Funding for Lending Scheme which is resulting in an expansion in loan availability, while loan rates remain at record lows due to the lowly bank rate.
'Ice gas' tapped
Japan breakthrough
Almost two years to the day since the earthquake and tsunami which laid waste to Japan's north eastern coast and virtually halted its nuclear energy programme, the country has finally made a breakthrough in tapping the so-called 'ice gas' reserves. A Japanese project to extract methane from ice stores 300m below the sea bed has reported success in extracting the first gas, a breakthrough which some in Japan claim could result in it being able to tap enough reserves to power the country for 100 years. While this represents a potentially meaningful event, the geological impact is as yet unknown.
Aiming high
Consultation plan
The long campaign for Aim shares to be qualified for inclusion in Isas could be approaching its end game. Following on from a pledge by chancellor George Osborne in his Autumn statement, a consultation has been launched by the Treasury on including shares traded on small- and medium-sized enterprise equity markets as Isa qualifying investments. The consultation will run until 8 May.
Having a giraffe?
Tesco buys
Supermarket giant Tesco has made a foray into the family dining market with the acquisition of restaurant chain Giraffe. The acquisition of the family-friendly chain for a shade less than £50m brings 48 operating stores, with a 49th to be opened shortly. Tesco reportedly has plans to open restaurants adjacent to its biggest stores in a bid to tempt frazzled families in for refreshment. It also means Tesco will be in a position to grab an even bigger share of the family budget. This is the latest move in Tesco's expansion into alternative brands and markets following its recent acquisition of a 50 per cent stake in coffee chain Harris & Hoole.
