Sunday newspaper round-up: Tesco, Flotations, ECB

5th Jan 2015 02:29

Tesco will scrap the system of rebates and penalty fees it uses to extract money from suppliers, the Sunday Times said. In a trading statement due on January 8th, Chief Executive Dave Lewis will replace the complex arrangements with a simple scheme based on sales volumes. The change will put pressure on other supermarkets because it will make Tesco more popular with suppliers. Tesco will give the strongest signal yet that it expects to make a trading loss for the current financial year.Tesco, Sainsbury's and Marks & Spencer are expected to announce Christmas sales declines that are unprecedented in modern times, the Sunday Telegraph reported. Tesco and Sainsbury's suffered lower food sales while M&S has struggled to sell more clothes. Morrisons and Asda are also expected to have suffered sales drops. Tesco Chief Executive Dave Lewis will announce cuts to the group's 23 UK offices and could announce sales of businesses such as Blinkbox and a stake in Tesco Bank.More than £20bn of flotations are expected in London over the next 12 months, the Sunday Telegraph reported. With the general election in May, companies are deciding whether to offer shares in February and March or to wait for the second half of the year. Tool-hire company HSS is likely to be one of the first listings on the main market. Miller Homes, Aldermore and British Car Auctions could attempt to revive offerings that they scrapped in October.Pressure will increase on the European Central Bank (ECB) to launch a full-scale monetary stimulus programme, the Sunday Times said. Figures on January 7th are expected to show that prices stagnated across the Eurozone. The bloc's economy could face further upheavals as Greece prepares for elections that could see an anti-austerity coalition take power. Economists think Mario Draghi, the ECB's president, could introduce quantitative easing in January despite German opposition.The City's most bullish analysts expect the FTSE 100 to rise as much as 17% in 2015, the Mail on Sunday reported. The team at US bank Citi have forecast that the index will hit 7,700 from 6,548 now. Other banks, such as Barclays and Morgan Stanley, expect smaller gains but have forecast rises of more than 10%.A series of international bidders, including Abu Dhabi's sovereign fund, are seeking to buy a stake in Associated British Ports put up for sale by Prudential and Goldman Sachs, the Sunday Times said. The two companies together own a third of the ports operator. UK private equity firm 3i is in one of the bidding groups and the stake could cost up to £1.2bn. But sources said the auction had attracted less interest than expected.Royal Bank of Scotland's bonus pool could be cut to below £500m in response to a clampdown by the European Union but many bosses will be paid big share-based allowances to avoid bonus caps, the Mail on Sunday reported. The state-controlled bank paid out £576m in bonuses last year.Former Barclays boss Bob Diamond's foundation has lost money on its Barclays stake and has hired State Street as its bank to replace the UK lender, the Sunday Telegraph said. Since the end of March, the foundation's financial year end, Barclays' shares have risen 2.5%.