Tuesday newspaper round-up: British Airways, Jupiter Asset, Prudential

Date: Tuesday 18 May 2010

British Airways has been granted an injunction to stop the Unite union from carrying out cabin crew strikes that had been due to start at midnight tonight.

The High Court ruling, based on a technicality in the balloting procedure, is set to delay the start of the first of a four five-day strikes planned for May and June. Unite conceded it would have to call off tonight’s strikes but said it would appeal immediately, meaning the case could reach the Court of Appeal as soon as tomorrow, the Times reports.

Jupiter Asset Management, one of the UK's best known fund managers, will today brave volatile markets by announcing its intention to list its shares publicly on the London Stock Exchange, potentially capitalising the group at up to £1bn. The float could net more than £500m for the group's 500 staff, including Edward Bonham Carter, chief executive, and big investors and top fund managers Tony Nutt, Philip Gibbs and John Chatfeild Roberts, the FT reports.

Foreign holders of Greek and Portuguese debt have seized on emergency intervention by the European Central Bank to exit their positions, leaving eurozone taxpayers exposed to the credit risk. The Bank of New York Mellon said its custodial data showed a "sharp acceleration" of net sales of debt from the two countries after the ECB began purchasing €16.5bn of bonds from southern Europe and Ireland in bid to halt market panic, the Telegraph reports.

The European Central Bank has bought €16.5bn of eurozone government bonds as part of international rescue plan, amid widespread investor concern that the intervention is not yet big enough to stabilise debt markets. The euro on Monday fell to its weakest level against the US dollar since April 2006 in spite of the €750bn international support package and central bank intervention. The euro has fallen 14% against the dollar this year, the FT reports.

Foreign demand for US and UK financial assets has surged amid anxiety over the turbulence in European markets. In the US, purchases of long-term securities, which include equities and bonds, nearly tripled from February to March, reaching a record $140.5bn, with China reversing course and adding to its Treasury holdings for the first time in six months. Private investors, flocking to safety, bought $80.2bn of Treasury bonds and notes, according to the latest Treasury International Capital data, the FT reports.

More than a million people could be dragged into paying capital gains tax after George Osborne confirmed that he would use his emergency Budget to hit investors. The Chancellor is to increase duty on capital gains even though the plan was not included in the Conservatives’ election manifesto. CGT on “non-business assets”, including second homes, buy-to-let properties and shares, could rise from the current 18% flat rate to a top rate of 40 or even 50%, to fall in line with the higher rates of income tax, the Telegraph reports.

Tidjane Thiam apologised to Prudential shareholders yesterday for the way he had handled the insurer’s Asian adventure, as he renewed his efforts to win their support for the $35 billion takeover of AIA.The Pru chief executive also fuelled speculation that its British and American businesses could be put up for sale once the deal was sealed, saying: “There is nothing sacred,” the Times reports.

Britain's investment industry will today launch an investigation into the cost of rights issues amid a mounting perception that investment banks are charging far more than they should for their work. The announcement will come just a day after Prudential confirmed that its cash call will generate £680m in fees for 33 banks together with a bevy of other advisors, the Independent reports.

Sir Stelios Haji-Ioannou has backed away from a fight with the board of the airline he founded, giving it a month to confirm that it is putting all expansion plans on hold. The Greek-born entrepreneur resigned from easyJet’s board on Friday, saying that he would be seeking shareholder support for moves to force the management to adopt a new strategy. The airline’s directors are scheduled to go on an “awayday” next month to discuss plans for growth, the Times reports.

Michel Barnier, the European internal markets commissioner, on Monday warned of a crackdown on the derivatives market just hours before officials met to thrash out the terms of new hedge fund and private equity legislation.The markets commissioner said he would deal "very severely" with credit default swaps in legislation planned for October. The warning came as a European Parliament committee prepared to vote on Monday night on a version of the Alternative Investment Fund Managers Directive, the Telegraph reports.