Friday newspaper round-up: Market slide, BP, British Airways

21st May 2010 06:26

Markets on both sides of the Atlantic dipped to fresh lows as fears surrounding the fate of the euro project transmuted into worries about the wider global economic system.Bill Gross of bond fund Pimco said that hedge funds were starting to liquidate their positions in a bid to preserve their capital - a worrying "mini relapse" towards 2008 territory. Andrew Roberts, head of European rates strategy at RBS, said "Great Depression II" could now be approaching, adding: "It now has potential to speed toward its conclusion; a European $1trn package which does little and political panic tells you we are about to reach the end of the road. The world should be discussing deflation, not inflation," the Telegraph reports.The US Senate has passed legislation that will usher in the biggest overhaul of Wall Street since the Great Depression, fulfilling President Barack Obama's vow to toughen regulation of the financial sector following the credit crisis. The Senate voted 59 to 39 to pass the 1,500-page Restoring American Financial Stability Act overnight, after months of argument between Democrats and Republicans over President Obama's reform proposals. The House of Representatives passed its own bill based on the President's ideas last December, the Times reports.Lawyers and accountants reacted with scepticism to government plans for a single "super-agency" to tackle white-collar crime and warned that the agency could be extremely messy to set up. The Conservatives and Liberal Democrats plan to merge the prosecution arm of the Financial Services Authority with the Serious Fraud Office and part of the Office of Fair Trading, according to the coalition document published yesterday, the Times reports.BP was on Thursday accused of seriously underestimating the flow of oil from its Gulf of Mexico well. n a further blow the beleaguered oil giant was also ordered to use less toxic chemicals to disperse its growing slick. It came as more damaging, heavy crude hit Louisiana's coastal wetlands and experts warned that the Gulfstream current could carry the slick round Cuba and into the Florida Keys, the Telegraph reports.Vodafone is in early stage talks about selling its controlling stake in Vodafone Egypt, the country's second-largest mobile phone operator, in a deal that could be worth £3bn ($4.3bn). Telecom Egypt, the country's leading fixed-line phone company, has approached Vodafone about buying the UK group's 55 per cent stake in Vodafone Egypt, the FT reports.Royal Bank of Scotland is examining a private sale of the Priory Group, owner of the celebrity rehab clinic, after shelving plans to launch an initial public offering to raise more than £1bn owing to turbulence in the capital markets. RBS has held discussions with a number of private equity groups about a potential sale,the FT reports. British Airways boss Willie Walsh has been accused by cabin crew union Unite of "putting ego and machismo" ahead of investors' interests. In a letter to BA's biggest shareholders, Unite's joint leaders urged investors to rein in the chief executive's hard-line approach. "You are paying the price for short-sighted management intransigence at BA," said Derek Simpson and Tony Woodley, the joint general secretaries of the union representing most of the airline's 13,400 cabin crew, the Telegraph reports.Google has marched on the television industry, with the launch of a system designed to fully integrate the internet with TV in a bid to "usher in a new category of devices for the living room". The company officially revealed the details of the product that "combines the TV that you already know with the freedom and power of the internet" after information leaked out earlier in the week, the Independent reports.Royal Mail's profits shot up by 26% last year, the company revealed yesterday, as the Government confirmed plans to part-privatise the group. Operating profits soared to £404m despite steadily falling mail volumes and last autumn's strikes, thanks to cost-cutting measures which included 8,000 voluntary job cuts. But revenues dropped for the first time in a decade - by £200m to £9.4bn - as the postal operator handled 13 million fewer letters than five years ago, the Independent reports.