Olympic Stadium: Dismay Over Delayed Future

By Enda Brady, Sky News Correspondent

Olympic and Paralympic champions have voiced their dismay at news that the stadium may not open fully until the summer of 2016.

Four bids are still being considered as full-time tenants at the Stratford venue, but each bid will require significant and time-consuming modifications.

Dennis Hone, chief executive of the London Legacy Development Committee, revealed this week that it will not re-open until August 2015 at the earliest and probably not before August 2016.

Olympic champion Jessica Ennis told Sky News that it is important the stadium is opened to the public as soon as possible.

She said: "I've some amazing memories of the stadium, like a lot of other athletes.

"I'd love to see it opened to the public as soon as possible."

Leyton Orient FC are among four bidders to use the stadium in Stratford

Paralympic double gold medallist Hannah Cockroft said it is vital to speed up the process so that the goodwill generated by the success of London 2012 could be tapped into.

She said: "The danger is that if it's not opened fully to the public for four years then that interest will wane.

"It's an amazing venue and people want to see it, they want to be a part of it. I really hope they sort this out, they have to."

A transformation project costing nearly £300m is currently under way at the site and is expected to last up to 18 months.

The park itself will be opened to the public on July 27 next year, one year to the day the Games opened in London.

Maria Miller, Secretary of State for Culture, Media and Sport, told Sky News: "The stadium is vital for the legacy of the Games, but the important thing is to get the right tenant in."

The four bidders are West Ham United FC, Leyton Orient FC, a Formula One venture and the University College of Football Business, an academic institution owned and run by Burnley FC.

A final decision is expected in the first half of 2013, or possibly sooner.

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Treasury Gets £35bn Windfall From QE Interest

The Treasury is to receive a £35bn boost as part of a deal with the Bank of England that will effectively reduce public debt.

Chancellor George Osborne and Bank Governor Sir Mervyn King have agreed that the BoE will give the Treasury interest earned through its £375bn economy-boosting programme known as quantitative easing (QE).

The cash - currently on the BoE's books - will flatter the public accounts by reducing the budget deficit, while also acting as a "small loosening of monetary conditions" equivalent to taking more QE action, according to the Bank.

The announcement comes a day after it decided not to extend QE at its monthly policy-setting meeting.

The Treasury said the agreement was in line with similar practices surrounding QE in the United States and Japan.

In a letter to Mr Osborne, Sir Mervyn stressed the cash transferred to the Government would likely need to be paid back to the Bank in the future.

The move comes at an apt time for Mr Osborne as he faces pressure on his plans to cut borrowing.

But JP Morgan Chase economist Malcolm Barr said it was "still likely" that the Chancellor will need to push back debt reduction targets in his upcoming autumn statement.

Shadow chief secretary to the Treasury Rachel Reeves said it was a "smoke and mirrors" deal.

"Instead of changing course and taking action to create the jobs and growth we need to get the deficit down. The Chancellor seems to think he can just be bailed out in the short term by money from the Bank of England," she added.

Under the arrangement, £11bn is expected to be handed to the Treasury this year, with the remaining £24bn paid in four instalments over the next financial year.

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Bank Of England Adopts QE 'Wait And See'

The Bank of England (BoE) has announced it will not pump more money into the UK economy this month.

The move follows the country's official exit from recession - but the BoE will be watching the recovery closely.

It was a decision widely expected by economists following the positive GDP performance in the third quarter of the year.

The bank's Monetary Policy Committee (MPC) confirmed at midday there was no extension to its programme of Quantitative Easing (QE) following its latest meeting.

The MPC has made £375bn of asset purchases to date amid the effort to boost money supply in the UK economy following the financial crisis.

Forecasters had initially predicted that total would be boosted by £50bn but the 1% growth in the economy measured over the three months to September largely silenced such talk.

Nevertheless, the MPC will be closely scrutinising the economic statistics over the next few weeks amid signs of a mixed picture.

A recent run of weak purchasing managers' surveys for the services, manufacturing and construction sectors in October have given credence to expert warnings that the underlying picture is much bleaker than the GDP numbers suggest.

The MPC decision - which also confirmed the base rate of interest at its historic low of 0.5% - preceded that of the European Central Bank which also left the eurozone's benchmark interest rate steady at 0.75%.

The Bank of England's move was predicted by all five members of the Sky News Money Panel.

Ross Walker, Senior UK Economist at RBS, said: "Recent data show a modest improvement - GDP, employment, revisions to the public finances -and MPC rhetoric suggests a waning enthusiasm towards further QE.

"Monetary policy appears to be transitioning away from quantitative- and towards credit-easing. "The Funding for Lending Scheme (FLS) is becoming the MPC's principal focus and there remains little sense that a Bank Rate cut is a serious runner at this time."

On the subject of the FLS, James Daley, editor of Which? Money was concerned the money got to the people who really needed it.

"We know that some of this money has been used by banks to lend to low risk, better off customers who are not the people who most need support," he said.

"Thousands of people are trapped on their bank's standard variable rate - and are unable to get a better deal as no one will take them. It's these mortgage prisoners who should be being helped out by the Funding for Lending Scheme."

Anthony Thomson, the founder of Metro Bank, ruled out more QE for at least the next six months. He said: "As the economy starts to improve, albeit tentatively, we will see further growth in GDP and this will reduce the need for further stimulus of this nature, and the impetus will move to providing credit to SMEs."

Louise George, the owner of Peter Popple's Popcorn, admitted she was concerned about growth. "Although the recession is officially over - there hasn't been a huge growth spurt and for our business it is still tougher to sell a premium product when people are still watching what they spend."

She called on the Chancellor to provide more support to small firms in his Autumn Statement next month.

Sir Martin Sorrell, chief executive of FTSE 100 advertising giant WPP, echoed her wish for a Government strategy to help smaller companies.

He said: "I think the Coalition Government is doing the right thing - trying to get revenue and costs into balance in the short term and starting to put together a more comprehensive long term strategy.

"The one thing that I think still needs to be done is articulating the overall growth strategy. "Lord Heseltine has tried to do this recently but still more needs to be done.

"The UK is in better shape now than it was a couple of years ago but we still do not have a comprehensive view on the future strategy. "I think the Autumn Statement is a big opportunity to identify the key growth levers and lift people's eyes from their boots to the horizon.

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Collapsed Comet 'Massive' Sale Slated Online

Customers who rushed to a sale at Comet have expressed disappointment over the level of discount.

The electronics retailer had announced a "massive stock liquidation" ahead of store closures as early as next week, but angry shoppers took to Twitter to complain about the price reductions.

Scott Houston said: "Comet 'Firesale' is no more than 10-15% off. Prices aren't even competitive with online prices. Time wasted."

And Matt Arthur tweeted: "Anyone thinking of going to the Comet 'liquidation sale', don't bother. 10% off audiovisual, 20% off kitchen appliances, still cheaper online."

Ajay Deshpande added: "If you are looking for cheap electrical goods then don't go to the Comet 'sale'!"

The sale was announced on Comet's website

In response, a spokesman for administrator Deloitte said: "The discounts are gentle. It's not a hard sale."

The sell-off, which began at 9am on Thursday, is only available in its 236 stores, with customers unable to buy products online. 

But some customers did manage to bag a bargain, with Alex Pegg tweeting: "In-pulse (sic) buy of the day, an Apple ProBook (£100 off from Comet)".

The electrical chain said gift vouchers would be accepted on sale items, following the temporary suspension of the tokens over the weekend. 

Comet is expected to confirm store closures next week following the sale

But it warned customers it would not offer refunds, and any items ordered before the company went into administration that have not been paid for will not be delivered. 

Comet's administrator Deloitte is in the process of winding down the business following its collapse on Friday, which leaves 6,600 jobs hanging in the balance.

But rival Dixons, which owns Currys and PC World, postponed hiring 3,000 Christmas staff by a week to allow Comet staff to apply.

It said it was "amazed" by the number of Comet employees that had enquired about positions so far.

Deloitte is attempting to find a buyer for the business and would not comment on speculation over store closures - although reports suggest stores could start to be closed next week.

If the chain does collapse, it will become one of the biggest high street casualties since Woolworths in 2008.

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World Stock Markets Fall After Obama Victory

World stock markets fell sharply on Wednesday afternoon amid concerns for the US and eurozone economies.

The Dow Jones in New York dropped 1.3% on opening - and fell over 2.4% in morning trading - in its first trading session since the re-election of President Barack Obama was confirmed.

Market analysts suggested there was concern among investors that he would struggle to thrash out a budget deal with a divided Congress with the looming so-called 'fiscal cliff' the most pressing problem.

A combination of higher taxes and government spending cuts will automatically take effect unless Congress agrees a new budget by January 1.

Economists warn that a failure to reach a concrete decision will push the world's largest economy back into recession.

The other major factor in the market falls was economic growth forecasts from the European Commission (EC) which were revised down on previous predictions.

The EC said it now expected GDP in the 17-country eurozone to contract by 0.4% this year and to grow by only 0.1% next year.

There was also bad news in the report for Britain in that it suggested UK output would decline by 0.3% in 2012.

The FTSE 100 closed down 1.58%, while the falls were steeper on the continent.

Germany's DAX lost 1.96%, the CAC 40 in Paris fell 1.99% - while Spain's IBEX was 2.26% down.

The turnaround in stocks markets was evident in currencies too as the euro lost ground against the dollar, trading a full cent lower.

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Supermarkets Cut Petrol Prices By Another 2p

Three supermarket chains have cut their petrol prices again, reducing the cost of fuel by 2p at pumps across the country.

Asda was the first to announce the discount, which follows similar reductions towards the end of last month.

It will now charge 137.7p for a litre of diesel and 131.7p for unleaded petrol on its forecourts.

Sainsbury's and Tesco followed suit, saying they would also slash 2p off their prices.

Welcoming the move, the president of roadside recovery group AA, Edmund King, said: "Once again the supermarkets have led the way on fuel price reductions.

"We have said the there is scope for price cuts given wholesale price falls and welcome the move and hope all the other retailers follow."

He said that many people are cutting back on the number of car journeys they make because of the high cost of fuel.

"This reduction will go a little way towards helping families and businesses keep mobile," he added.

Asda's petrol trading director, Andy Peake, said his company was "leading the way" in reducing the price at the pump.

"Unlike other retailers, our price cuts benefit everyone across the country, meaning that no one filling up at Asda will be forced to play a postcode lottery," he said.

A Tesco spokesman said: "As Britain's biggest petrol retailer with 490 forecourts, more motorists will make savings at the pumps at Tesco than at any other fuel retailer."

And Sainsbury's head of fuel, Richard Crampton, said: "With Christmas on the horizon, we know that this can be an expensive time of year so we're delighted to announce that we will be lowering our petrol and diesel prices."

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M&S 'Taking Action' As Profits Take A Tumble

Marks and Spencer has reported a fall in underlying pre-tax profit to £297m for the first half of this year and pledged further moves to drive sales.

The chain, which is 18 months into a three year transformation plan, blamed pressure on consumers' disposable incomes and volatile trading conditions - hit by bad weather - for the figure, which compares with a £307m profit over the same period last year.  

But sales across the 128-year-old group were up 0.9% at £4.7bn - driven by a strong performance in its food division and internationally.

In its UK stores, however, sales were flat in the second quarter with a 1.6% rise in food partially offsetting a 1.8% fall in general merchandise sales. 

It follows a 6.8% slump in general merchandise sales in the first quarter as a result of the wet summer weather and problems with stock availability, which left stores short of bestselling womenswear lines.

The group's chief executive, Marc Bolland, told Sky News: "We have repaired our womenswear position strongly over the second quarter.

"The issues we had were with merchandising and stock, we're now bucking the trends."

He added: "The first quarter was a difficult quarter as we explained three months ago, the second quarter has improved quite strongly."

Marks and Spencer, which has 730 stores in the UK and 390 overseas, said it was "well set up" for its busiest time of the year.

"As we approach the all-important Christmas period, we have better than ever Christmas products, to help our customers enjoy a special Christmas at home," Mr Bolland said.

Primark has been one of the high street's best performing stores

Marks and Spencer's aiming to transform itself into an "international multi-channel retailer" by boosting its website and making it easier to buy products on smartphones and tablets. 

Mr Bolland said this strategy was making "strong progress", with growth across its multi-channel business.

Retail analysts Conlumino described the results as a "mixed bag".

"While the overall half year numbers look anaemic, there has been a material uplift in fortunes since the first quarter," managing director Neil Saunders said, adding that it is too early to say whether the group is on the path to sustainable growth.

"M&S has still underperformed the market in fashion and growth in general merchandise remains elusive on a like-for-like basis.

"All of this points to the fact that M&S still has plenty of issues to resolve and there is still much work to be done."

The results came as Associated British Foods revealed that revenue across its 230 Primark stores had grown by 17%.

The clothes retailer has been one of the best performing stores on the high streets in the UK, Ireland and Spain because of its low prices and quick adoption of fashion trends.

The group, which also includes Twinings, Silver Spoon and Ryvita among other brands, reported a 17% rise in full-year profit.

Following "exceptional performance", the company said its adjusted pre-tax profit was £974m and revenue was up 11% to £12.3bn.

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Romney Win 'Could Boost Dow By 500 Points'

The Dow Jones industrial index might be boosted by up to 500 points if Republican presidential hopeful Mitt Romney wins the election, it has been claimed.

The Centre for Economic Business Research (CEBR) said the bounce could occur before Mr Romney, who has trailed Democrat candidate Barack Obama in some polls, implemented his new policies.

"A President Romney has promised a radical departure, with bigger budget cuts and tax cuts," CEBR head Douglas McWilliams said.

"And he would be perceived as pro-business which might boost the financial markets."

Mr McWilliams added: "I would be surprised if a President Romney changed the economy as much in the short term as his policy platform suggests.

The CEBR believes Congress may be divided irrespective of the winner

"Though there would be an initial market bounce of perhaps 500 points on the Dow because a Romney victory is not priced in."

The CEBR believes that quantitative easing (QE) – the injection of liquidity into the financial system – has been effective in boosting a return to modest growth.

"What is different is that in the US, QE has worked; in the UK it has been much less effective," Mr McWilliams said.

"Bank lending in the US is growing for both business and households. Even property lending, which for a long time had been in the doldrums and was holding back the US economy is growing."

Mr McWilliams, a former chief economic adviser to the CBI and chief economist for IBM UK, said US growth may accelerate by its newly exploited source of cheap energy - shale gas.

"The country is gradually becoming self-sufficient in energy which is very cheap by Western standards," he said.

"Because of increased drilling, oil is a fifth cheaper than in Europe while shale gas is available at the equivalent of a quarter of the price of oil."

However, the competitive edge given by the cheap gas is set to be exploited by key competitor China, which is could hold the world's biggest reserves of shale gas.

Shale gas extraction has been trialled on a small scale in Britain

The Chinese government has announced a subsidy to spur the industry and it hopes to use shale gas for at least 6% of the market by 2015.

While Mr Obama has needed to broach the issue of tax rises within a divided Congress, Mr Romney has urged tax cuts to spur future growth – a concept the CEBR believes could be innovative amid a record deficit.

"In the longer term there is more scope for a President to make a difference and we could see the option of low spending and low taxation applied in a major Western economy," Mr McWilliams said.

"It could prove an exciting experiment."

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BRC: Retail Sales Fall Ahead Of Christmas Rush

Retail sales have grown at their slowest pace for almost a year as shoppers stick to buying only essential items, according to new research.

Like-for-like sales were down 0.1% in October, compared with the same period last year, a study by the British Retail Consortium (BRC) and professional services group KPMG showed.

While total sales were up 1.1%, against a 1.5% rise the year before - the slowest growth in total sales, excluding Easter, since November 2011.

It follows a surprise hike in September when like-for-like sales were up 1.5% and total sales were up 3.4%, which the BRC's director general described a "something of a false dawn".

"October's poor performance wasn't a one off," Stephen Robertson said.

"Year-to-date average growth hasn't outpaced inflation meaning overall sales volumes going backwards."

October's online sales were especially poor, he said, adding that the last three months include the two weakest growth rates recorded in four years.

"Falling consumer confidence means people are limiting spending to essential items and are cautious about committing to big-ticket and discretionary buying," he said.

"This underwhelming showing means there's all to play for as Christmas approaches."

KPMG's head of retail, David McCorquodale, said that although official figures last month showed the UK was out of recession, consumer confidence has not yet bounced back.

"Retailers are holding less stock than a year ago and may choose to be cautious with pre-Christmas sales in order to protect margins," he added

"However, the disappointing sales figures for October indicate that winning share of the Christmas wallet will be just as competitive over the next two months as it was last year."

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HSBC Hit By £500m Money Laundering Charge

By Mark Kleinman, City Editor

HSBC will tomorrow prolong the latest wave of financial penalties for Britain's banks by setting aside hundreds of millions of pounds more to cover settlements for breaching anti money-laundering rules.

I have learned that HSBC will raise the likely bill for fines from US authorities to as much as $1.5bn (£935m) in its third-quarter results, a move that will underline the growing seriousness of the probes into the conduct of one of Britain's biggest lenders.

The revised estimate will mean HSBC allocating $800m (£500m) to potential penalties in its accounts for the three months to the end of September following a $700m (£437m) hit disclosed in its half-year results in July, analysts say.

The expected fines relate to inadvertent breaches by HSBC of anti-money laundering procedures in its Mexican operations which are now under investigation by a string of powerful US watchdogs.

If the eventual settlement does reach as high as $1.5bn, it would be one of the largest punishments ever meted out to a British bank.

News of the fine comes just days before the US presidential election and in the wake of public concerns from British regulators over the handling of banking misconduct inquiries by their American counterparts.

In its interim results in July, HSBC said the $700m charge was its "best estimate of the aggregate amount of fines and penalties that are likely to be imposed in connection with these matters. There is a high degree of uncertainty in making this estimate, and it is possible that the amounts when finally determined could be higher, possibly significantly higher."

Since then, the bank is understood to have held further discussions with US regulators, which have prompted it to increase its estimate of the prospective fines.

Regulatory sources familiar with the discussions on both sides of the Atlantic said that HSBC continued to possess no definitive guidance about the timing or scale of settlements with the relevant authorities.

At a US Senate sub-committee hearing in July - during which David Bagley, HSBC's Head of Compliance, resigned - the bank admitted that it had fallen short of the required standards in processing transactions in Mexico. Days later, it was fined $27.5m (£17m) by Mexican regulators over the failings, which potentially gave drug-lords, terrorists and other criminals a gateway into the US banking system.

The investigations sparked by the Mexican offences prompted Stuart Gulliver, HSBC Chief Executive, to launch an overhaul of the bank's compliance operation.

Since the summer, it has hired Robert Werner, former Director of the US Treasury's OFAC, as head of global standards assurance, a new role in the group. It also recruited Preeta Bansal, a senior official in the Obama administration, as global general counsel for litigation and regulatory affairs.

Mr Gulliver, who took over the running of HSBC in 2011, after the offences in Mexico took place, said in July that it was right that the bank be held accountable for them.

"We are profoundly sorry for our mistakes, and are committed to putting them right. With a new strategy and senior leadership team in place since the start of 2011, we are introducing new processes and structures to help us manage risk and ensure more effective compliance in the future."

HSBC is not the only UK-based bank to have fallen foul of US regulators in recent months.

Barclays paid £290m in June to settle with authorities in the UK and US over evidence that traders had attempted to rig the key interbank interest rate Libor.

Standard Chartered, the emerging markets bank, paid $340m (£212m) to the New York state Department of Financial Services after being accused of concealing illicit Iranian transactions. The department's handling of the probe led Sir Mervyn King, Governor of the Bank of England, to issue a rare public rebuke. Standard Chartered remains in talks to settle with other US bodies.

On Friday, Stephen Hester, Chief Executive of the taxpayer-backed Royal Bank of Scotland (RBS), said he expected to begin settlement talks over Libor-fixing in the near future.

The quarterly results of Britain's banks have been overshadowed by the escalating cost of historic misconduct, principally relating to the mis-selling of payment protection insurance (PPI). Between them, Barclays, Lloyds Banking Group and RBS set aside a further £2.1bn for PPI compensation in the third quarter, with HSBC expected to add a comparatively modest sum to that total.

Beyond fines and penalties, however, HSBC's quarterly results are expected to depict a bank in rude health. Analysts at Deutsche Bank say that it will report approximately $5bn in third-quarter profits, although that figure does not include PPI and money-laundering provisions.

Mr Gulliver has shed almost 40 HSBC-owned businesses since he took over, and has adopted a more pragmatic approach to the shape of its international operations, focusing on disciplines such as trade finance, where it has a competitive advantage.

HSBC refused to comment today.

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Delicate Diplomacy On Cameron Gulf Arms Tour

David Cameron is starting a three-day tour of the Gulf and Middle East today in a bid to cement major UK arms sales and bolster relations with allies in the region.

The Prime Minister will personally spearhead a push to persuade the United Arab Emirates to buy 60 of BAE's Typhoon jets over French rivals in a deal reported to be worth upwards of £3bn.

On Tuesday, he will travel to Saudi Arabia - Britain's biggest trading partner in the region - which is also considering adding to its fleet of aircraft.

Downing Street said the visit - Mr Cameron's second to each country as premier - was part of a wider effort to build a "reinvigorated partnership" between Britain and the region's leaders.

Reinforced military ties are seen as crucial amid continued fears over Iran's nuclear ambitions and the threat Tehran could seek to badly disrupt oil supplies by blocking the Straits of Hormuz.

Mr Cameron will fly first to a military airbase near Dubai where a number of RAF Typhoons are stationed to promote the aircraft to military and political figures from the UAE.

He will also hold talks with the Crown Prince of Abu Dhabi and Prime Minister of the UAE on the potential for a joint work on the next generation of military aerospace equipment.

The Government hopes to secure deals for 100 Typhoons to be sold to the region in the coming year - worth at least £6bn to British firms.

Mr Cameron faces a tough balancing act however as he attempts to secure billions in investment from the oil-rich states while addressing concerns about the human rights records of their regimes.

The Arab Spring has led to an increased focus on largely autocratic rule in many states, including crackdowns on pro-democracy and other protest movements.

The Government has been criticised for failing to condemn abuses and accused of continuing to sell military equipment with insufficient guarantees it would not be used in repression.

But Saudi officials reacted angrily to an "insulting" inquiry into it by the Commons foreign affairs committee, warning it would be "re-evaluating" relations.

"We want to work together with the Gulf countries towards a future that is rich in prosperity, strong in defence and open in its handling and pursuit of political and economic reform," Downing Street said ahead of the visit.

On Wednesday, Mr Cameron will make a short visit to the Middle East before flying home for talks with German Chancellor Angela Merkel at Downing Street ahead of the crunch EU budget summit.

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