The company was knocked back 59.5p to 1,224p following the revelation that its chief executive got rid of nearly 370,000 shares earlier in the week, selling them off at an average of 1,285p each. While by no means all of his stake – he still holds over 1.5 million shares – traders highlighted the lack of explanation for the sale, suggesting the reaction would have been better if the Square Mile had been given a reason.
Sir Frank, who is among the longest-serving Footsie bosses but plans to step down next year, will be wishing he had sold up a couple of months earlier. Back in March, before BG fell sharply along with the rest of the market, the stock reached 1,547p, meaning he could have earned himself nearly an extra £1m. Still, he may also point out that when he took the job back in 2000 the stock was less than a quarter of where it trades now.
BG was clearly in the mood for selling – it also announced it had struck a deal to get rid of its stake in two Philippines power plants for $360m (£231m). The group had agreed a sale of the business nearly two years ago which subsequently fell through.
It was not a good session for the oil companies in general as a sharp drop in the price of black gold weighed on the sector, with Tullow Oil dropping 49p to 1,427p and BP 8.55p lower at 398.3p.
It was the same story across the City as a torrent of bad news from the eurozone left the FTSE 100 93.86 points weaker at 5,297.28, while disappointing housing data from the States did not help. At the same time the heavyweight diggers were left deep in the red amid growing despondency over the likelihood of the Chinese government giving a major boost to the country's economy.
Another depressing factor was the fact a number of stocks were trading ex-dividend, including Marks & Spencer. The high street institution dipped 12.8p to 332.2p despite analysts from ING removing their "sell" advice, saying they welcomed the recent decision by M&S to cut back on its spending plans.
There were only six risers, with Severn Trent in the gold medal spot. The water utility – which has recently been boosted by takeover speculation – gushed up 42p to 1,706p after its full-year results beat the City's forecasts.
Arm Holdings edged 1p higher to 508.5p, with the chip designer helped by bullish comments late on Tuesday from customer Apple's boss Tim Cook on the tech giant's future plans.
Meanwhile, the decision by Dell to supply microservers using Arm's technology alongside those powered by chips from bitter rival Intel was being applauded by the Square Mile, with some suggesting this could result in extra annual sales of as much as $36m. At the same time, UBS's Gareth Jenkins was pointing out he believed further cash returns were likely from the chip designer.
Down on the FTSE 250, reports that a group of Indian ministers have recommended that coal blocks allocated to Essar Energy should get the green light saw the power giant spark up 25.5p to 141.8p. However, it was quick to say it believed the final decision would be taken by the Indian cabinet and that no official notification had been received yet.
Centamin was in demand. A revised development plan for its Sukari mine in Egypt saw the gold digger tick up 2.5p to 64.25p, with Bank of America Merrill Lynch reiterating its "buy" advice.
While Booker's deal to buy wholesaler Makro saw the cash and carry firm jump 7.9p to 87p, it was not the only purchase to receive a positive reaction.
On Aim, the environmental support services company Silverdell saw its shares lifted by 1p to 11.12p after saying that its £15m acquisition of EDS Group would be "transformational".
In the wake of talk that Maxim Barsky is rejoining TNK-BP as an adviser, having resigned as deputy chief executive of the Anglo-Russian group last year, dealers were highlighting vague speculation recently that it could be a step on the way to him taking the top job.
This, they suggested, may not be too promising for driller Matra Petroleum (0.12p worse off at 2.42p) of whom Mr Barsky recently became boss, although others have talked down the possibility of him getting the top job at TNK-BP.
Forex: USD/CHF up on solid greenback, KOF - FXStreet.com
FOREX-Euro gets a lift from EU comments, but more losses seen - Reuters UK
* EU Commission comments lifts euro from lows
* Euro hits near 2-yr low vs dollar; dollar index at 20-mth high
* Focus on rising Spanish debt yields and risk of bailout (Recasts, adds quote)
By Anirban Nag
LONDON, May 30 (Reuters) - The euro bounced from near two-year lows against the dollar on Wednesday, after the European Commission called for sweeping reforms to restore investor confidence, but gains were likely to be fleeting on growing concerns about Spanish banks.
The European Commission said the euro zone should move towards a banking union and consider eurobonds and the direct recapitalisation of banks from its permanent bailout fund as it laid out year-long recommendations in a report.
The euro rose to as high as $1.24684 from a 23-month low of $1.24241 on trading platform EBS after the comments, but analysts said any bounce would only provide a fresh opportunity to sell the common currency.
"We will sell into this bounce as these proposals will take a long time and will entail changes to the treaty," said Geoffrey Yu, currency strategist at UBS.
Earlier the euro fell to its lowest since early July 2010, as real money and institutional investors stepped up sales of the currency. Their selling gathered pace as concerns grew about Spain's ailing banking sector and soaring borrowing costs, and after Italy was forced to pay dearly to sell debt.
The euro was seen highly vulnerable to further falls, with many analysts looking for a drop towards $1.20.
Concerns are growing that Spain may have to tap debt markets at a time when bond yields are near unsustainable levels. Market players fretted that it may be forced to seek an international bailout.
Adding to the euro's woes, Italian 10-year government bond yields topped 6 percent as sentiment on the indebted economy looked vulnerable to contagion from Spain's worsening problems.
"The euro is in an extremely vulnerable position and downside risks are very strong indeed ... The Spanish banking crisis has the potential to knock the stuffing out of the euro zone irrespective of the Greek election results," said Jane Foley, senior currency strategist at Rabobank.
"The issues for Spain are undoubtedly huge and most people are coming round to the idea that it will need to go outside of its borders for assistance. The longer it delays, the more the risk of a bank run."
More falls could see the euro test a reported options barrier at $1.2400. Below there it has little chart support until $1.2151, a low hit in late June 2010, and then the 2010 low of $1.1876.
The common currency also lost more than 1 percent against the safe-haven yen, taking it to a four-month low of 98.274 yen. It recovered to trade at 98.425 yen, still down 0.9 percent on the day.
DOLLAR BUOYANT
A government source told Reuters on Tuesday that Spain would likely recapitalise Bankia, which asked for 19 billion euros on Friday, by issuing new debt and possibly drawing cash from the bank restructuring fund and Treasury reserves.
The euro's weakness benefited the safe-haven dollar and yen, helping the dollar index, which measures its value against a basket of currencies, rise to a 20-month high of 82.749.
Technical analysts said a monthly close about the 100-month average in the dollar index around 81.82 may herald a shift in the longer-term trend of the dollar and reverse a multi-year drift lower.
The dollar also rose to a 15-month high against the Swiss franc at 0.9666 francs on EBS.
The higher-yielding Australian dollar fell 0.7 percent to $0.9777, slipping towards a six-month low at $0.9690, after weaker-than-expected retail sales data underscored the case for interest rate cuts. (Additional reporting by Jessica Mortimer; Editing by Andrew Roche)
Forex: EUR/USD in further lows, EMU data - FXStreet.com
MONEY MARKETS-Speculation of ECB interest rate cuts returns - Reuters UK
* Markets pricing small probability of ECB rate cut in June
* Such bets likely to accumulate in coming days
* As in May, markets could set themselves up for letdown
By Marius Zaharia
LONDON, May 30 (Reuters) - Bets that the ECB will cut interest rates next week are again appearing in money markets, as Spanish and Italian debt yields are approaching levels that made the central bank introduce unprecedented easing measures last year.
The threat that Greece could eventually leave the euro and worries over Spain's banking sector have prompted investors to sell Spanish and Italian debt, bringing the two countries' borrowing costs closer to levels deemed as unsustainable.
The sheer size of their debt markets and their deep-rooted connections with other financial systems in the euro zone are reasons for investors to speculate that a policy response is in the works.
The European Central Bank is, as usual, seen as the most likely institution to take measures to cool market nerves because it can act faster than politicians. It has done it before in the past by injecting around 1 trillion euros of cheap loans into financial system in December and February.
Euro zone economic data this month has also been poor, supporting bets that the ECB may soon resume monetary easing, possibly by cutting its key refinancing rate by 25 basis points from a record low of 1 percent.
"Data ... have been softer, and then you have the Greece issue continuing to be unresolved and the Spanish issue continuing to be unresolved," said Elaine Lin, a rate strategist at Morgan Stanley, whose economists predict a rate cut.
She said the euro overnight Eonia rate forward market was only pricing an over 10 percent probability of a rate cut in June and the chances were higher by another 10-20 percentage points for the July meeting. However, she expected markets to factor in a higher probability in the next few days.
A key rate cut, if also accompanied by a cut in the 25 basis points deposit facility rate, could trigger a 5-10 bps fall in the near-term forward Eonia rates towards the 20 bps level seen now in September-October Eonia forward rates, Lin said.
The lowest point on the 2012 Eonia curve is December, at 16 basis points, which implies an 80 percent probability that the deposit rate would be slashed in half, according to BNP Paribas rate strategist Matteo Regesta.
A Reuters poll of economists showed the ECB was likely to resist pressure to cut interest rates in June, but also pointed to a growing probability that it will reduce them later this year.
Speculation about ECB monetary easing has also been fuelling a rally in Euribor futures , implying bets for lower fixings of benchmark euro zone interbank three-month Euribor rates later this year.
The December Euribor future has gained back most of its losses made since Greece's inconclusive election on May 6, which sparked fears the country may be on its way out of the bloc. The fall earlier this month also coincided with unwinding bets that the ECB would have cut rates in May.
The contract was last 3.5 ticks higher on the day at 99.46. That was one tick lower than the pre-election close on May 4, but some 15 ticks higher from the lows hit in mid-May.
The move higher in Euribor futures, which has been faster than the move lower seen in the very low Eonia forward rates, has led to tighter Euribor/Eonia spreads, which are widely used as a gauge of money market stress.
That is counter to what is happening in banking credit default swap markets - where investors can insure against banking defaults. The Markit iTraxx index of European senior financials CDS remains close to its highest level this year at around 300 bps.
BNP Paribas' Regesta warned that Euribor futures could fall again as they have done after the ECB's May meeting and this would trigger a widening of the Euribor/Eonia spreads consistent with the levels of stress felt in money markets.
"You have a decoupling between those spreads and the banks CDS now, but those spreads remain exposed to significant paying interest in coming weeks ... unless there is another policy response from the ECB at its meeting next week," Regesta said.
Kleefisch Money Bomb Raises over $53k - Big Hollywood
The money bomb launched yesterday for Wisconsin's embattled Lt. Governor Rebecca Kleefisch yielded an impressive five figures. Kleefisch's campaign received 1,035 donations with $53,706.51 as the grand total.
The money will go towards ad buys to defend the successful Lieutenant Governor from out-of-state labor interests who have dumped millions behind her challenger.
Click here to learn more about Lt. Governor Rebecca Kleefisch, the Wisconsin recall, and her race. It is second in importance only to the presidential election this year.
Does any race better embody the struggle between the future of liberty and the iron fist of oppression and tyranny than that of a Wisconsin mom verses the machine?
Make no mistake: a loss in Wisconsin will derail the first generation of reform governors. It will affect every other state, and give the President a singular victory from which to campaign as he slides his failed policies off the table.
Not only that, but a loss for Kleefisch could discourage other women from running for office. Conservative women have been met with a barrage of abuse simply for being conservatives, and Kleefisch is no exception. If other potential female conservative candidates see what the left is capable of doing to one currently in office, don't expect to see them take on the heat of a campaign in the future.
Thanks to Michelle Malkin and Teri Christoph of ShePAC and Smart Girl Politics for helping organize this hugely successful effort, and to Twitchy for the non-stop coverage of #Rally4Rebecca.
Also check: WI Recall: Five Reasons We Must Fight for Lt. Gov. Rebecca Kleefisch.
Diablo 3 real-money Auction House targeting June 12 launch - CVG Online
Diablo 3's real-money Auction House is being targeted for a June 12 launch.
The real cash Auction House feature was initially expected to launch on May 22, and then May 29 before being delayed once again to an unspecified date outside of May.
"In light of the post-launch obstacles we've encountered, we have made the decision to move the launch of the real-money auction house beyond the previously estimated May time frame," Blizzard said at the time of the most recent delay.
Users also reported post-update server issues, with the dreaded Error 33 - among others - making a most unwelcome return. But according to the latest updates these issues appear to be resolving, and happiness is slowly returning to Diablo-land.
Money Advice Group secures £10million from PNC - bdaily.co.uk
Money Advice Group, one of the UK’s leading financial solutions companies, is embarking on a comprehensive growth strategy after securing an asset based lending facility worth £10 million, with PNC Business Credit.
In conjunction with, Dow Schofield Watts, Money Advice Group negotiated the credit facility to enable continued growth through a combination of working capital funding and finance for acquisitions.
Boasting a solid 10-year heritage, Money Advice Group currently holds approximately 8% market share of the fee charging financial solutions industry, with a turnover of £15million. Handling £250million of consumer debt, the financial solutions company has 28,000 clients that it hopes to grow by a third, with the help of the cash reserve from PNC.
Money Advice Group’s expansion plans have been stimulated by increased attention from the Office of Fair Trading (OFT), resulting in a compliance review in 2011, which saw a significant number of debt management companies either voluntarily exit the market or be forced to close due to lack of compliance. No longer open to flexible and often lax regulations, the debt management industry is now governed by the OFT’s more stringent ‘Debt Management Guidance’ published in March 2012 – and the enforcement of such has led to an industry trend of consolidation. This has created significant opportunities within the industry for larger players, with the potential to gain more market share by assisting those smaller players who wish to exit completely or sell their book of customers, in light of the cost associations of becoming compliant.
Money Advice Group’s proactive stance has allowed it to anticipate this shift in the debt management industry, and prior to its partnership with PNC, had self-funded an exercise in acquiring a small player exiting the market. The success of such a venture was the catalyst for its ambitious plans for growth and prompted the discussions with PNC to facilitate an acquisitions strategy.
The agreement with PNC is part of Money Advice Group’s overall expansion plans, which will see it take on an additional 3,500 feet² of office space within its existing premises, and boost its workforce with several new appointments within the management and client services teams. Money Advice Group has already recruited 60 members of staff in order to facilitate expansion, bringing the company workforce to 285.
Simon Brown, Managing Director, Money Advice Group commented: “With the introduction of more stringent compliance guidelines than our industry has ever witnessed, we spotted an opportunity in the market. We are extremely proud of our compliant culture but the costs associated with becoming compliant are too excessive for some of the smaller players, so what we find is they want to exit altogether or just sell on some of their books or assets. We trialed this approach last year with the successful acquisition of a smaller company, and it was from this we saw a clear direction for Money Advice Group.
“Our decision to work with PNC stemmed from its reputation in this arena, and its innovative approach to facilities based on loan to value rations against specific assets. This offered a more substantial funding line, enabling us to take advantage of the opportunities in the industry – specifically acquiring both medium-sized and large competitors, and to expand into new markets.
“We have ambitious plans for expansion and growth, and the partnership with PNC has assisted us in realising these plans. We look forward to continuing the working relationship with PNC Business Credit.”
Mark Shackleton, PNC Business Credit said: “Money Advice Group has the infrastructure, industry knowledge and experience to facilitate steady growth through acquisition. There is a clear strategy to grow the business and we are pleased to be adding Money Advice Group to our growing portfolio of clients”.
ENDS
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