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Article Abstract:

UK interest rates are likely to be reduced following the Nov 1995 Budget. Interest rates will be affected by German and US interest rates and by developments in world bond markets. It is unclear whether the government has improved its chances of winning another election, and monetary policy will be important in helping the ruling Conservative party. A cut in interest rates of 0.5% looks very likely in Dec 1995. This has been built into share prices so will have to materialise for the market to continue unaffected.

Economic aspects

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Cider attack

Article Abstract:

Strong cider has been affected by a tax increase of 8 pence. This affects cider of over 7.5% such as Diamond White from Taunton. The product accounted for 25% of the company's total sales of 125 million pounds sterling in 1994, and a larger proportion of the profit of 20.3 million pounds. Premium brands have increased their stake in the total market for cider to some 20% from 5% six years prior to 1995. Other brands would be hit if the content limit for duty were reduced to 6%.

FOOD AND KINDRED PRODUCTS, Cider, All Other Food Manufacturing, Taxation

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The doubtful charms of share buy-backs

Article Abstract:

Stock buy-backs are seen as a way of boosting earnings per share and they can raise the value of companies. They may be carried out in response to the United Kingdom Jul 1997 Budget which took away dividend tax credits from pension funds. The proportion of debt relative to equity is increased by stock buy-backs and this is a possible drawback. Risk attached to companies increases since bondholders and bankers have precedence over stockholders when payment has to be made.

Corporations, Securities

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