Good morning New York,
The real reason the Chinese are mad for gold: Izzy explains — with a little help from Lombard Street’s Freya Beamish — why gold imports tell us more about China’s weaknesses than they do about China’s prosperity.
From inventory denial to inventory acceptance in aluminium: It’s been a long time coming, but markets have finally figured out that encumbered inventory in financing deals doesn’t impact prices the way they thought it did.
Lloyds back in profit as it prepares for private sector return: Lloyds Banking Group swung to its first pre-tax profit in three years in 2013 as the part-government owned bank prepares for a return to the private sector. The group on Thursday reported a pre-tax profit of £415m for 2013, a turnround from a loss of £606m in 2012. (Financial Times)
BNP Paribas hit by $1.1bn provision: BNP Paribas has set aside $1.1bn in provisions amid fears that it has breached US economic sanctions, becoming the latest bank to suffer from mounting legal bills as regulators and governments crack down hard on misbehaviour. (Financial Times)
Apple to name-and-shame suppliers of ‘conflict minerals’: Apple is extending its supply chain clean up beyond Chinese factories and into African mines, using name-and-shame tactics to cut the amount of “conflict minerals” that end up in its iPhones and iPads. (Financial Times)
Rolls-Royce warns of flat profits as US defence spending cuts hit: After “defying gravity” for the past few years, Rolls-Royce has warned its revenue and underlying profits this year will be flat for the first time in a decade as US defence cuts eat into its military aerospace engine orders. (Financial Times)
Nestlé downbeat on prospects for global growth: Nestlé issued a downbeat assessment of the prospects for the global economy as it reported its slowest year of growth since 2009. The world’s largest food company normally targets annual growth of between 5 and 6 per cent, but said on Thursday that during 2013, sales had ticked up just 4.6 per cent to SFr92.2bn. Net income fell 2 per cent to SFr10.4bn, or SFr3.13 per share. (Financial Times)
Homeserve hit with record £31m fine: The City watchdog has slapped Homeserve, the emergency repairs business, with the largest retail fine to date for mis-selling insurance policies. (Financial Times)
Comcast agrees $45bn bid for smaller rival Time Warner Cable: Comcast is set to acquire Time Warner Cable in a deal that values its smaller rival at $45.2bn after a six-month battle to consolidate America’s fragmented pay-TV market, according to people familiar with the matter. (Financial Times)
Markets: Global equities are in danger of snapping a six-day winning streak with waning risk appetite exhibited in a strengthening yen, weak industrial commodity prices and a slumping Australian dollar. “The rally in risk assets is losing its momentum,” wrote Crédit Agricole analyst Mitul Kotecha. US index futures show the S&P 500 shrugging off news of a $45bn cable merger, shedding 5 points to 1,814 as the FTSE Eurofirst 300 opens with a 0.3 per cent loss and its Asia-Pacific peer retreats 1 per cent. This leaves the FTSE All-World index down 0.2 per cent for the session. Since hitting its 2014 low on February 4, the stock barometer had by close of play on Wednesday rebounded 4.3 per cent as fretting about emerging markets and global growth faded. Extra impetus was provided by market-friendly comments from new Federal Reserve chairwoman Janet Yellen, whose testimony before Congress seemed to confirm the US central bank was in no hurry to raise interest rates soon. Ms Yellen also will appear before the Senate Banking Committee later on Thursday. (Financial Times)