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Morning business round-up: Shares up on bank move hope

What made the business news in Asia and Europe this morning? Here's our daily business round-up:

European stock markets ignored fresh warnings about Italy's ability to repay its debts by rising sharply on Wednesday.

Reports that European leaders are considering co-ordinated action to bolster banks saw markets in London, Frankfurt and Paris open up more than 2%.

On Tuesday, Moody's cut Italy's credit rating by three notches and warned about the country's growth rate.

But investors focused on signs that the bank system may soon be recapitalised.

In an interview in the Financial Times, Olli Rehn, European commissioner for economic affairs, said: "There is an increasingly shared view that we need a concerted, co-ordinated approach."

Europe's stronger economies should avoid imposing drastic budget cuts at the expense of growth, according to the International Monetary Fund.

If things get too bad in the UK Germany or France, they should "consider delaying" cuts, because they can borrow "at historically low" interest rates.

It also warned that a recession in Europe in 2012 could not be ruled out.

In Greece, a 24-hour general strike is under way in protest at the nation's austerity measures.

Flights and ferry services have been cancelled, schools, government offices and tourist sites are closed, and hospitals are working with reduced staff.

Thousands of people are also joining protests organised by the main unions in central Athens and other cities.

The latest estimate of UK GDP contained an unpleasant surprise as it revised second quarter growth down to 0.1% from the previous estimate of 0.2%.

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Output from the service sector grew by 0.2% in the quarter, compared with the previous estimate of 0.5%, the Office for National Statistics (ONS) said.

There was better news from a separate survey. The Markit/CIPS purchasing managers' index for the service sector recorded a figure of 52.9 in September, up from 51.1 in August. A figure above 50 indicates growth.

However, latest figures from UK supermarket group Tesco reinforced worries about the strength of High Street spending.

Although Tesco's half-year profits rose 12.1% to £1.9bn, like-for-like UK sales excluding VAT and petrol fell 0.5%.

The company highlighted "excellent growth" in Europe and Asia but also noted "subdued demand" in the UK.

The latest edition of Business Daily from the BBC World Service hears from Professor David Blanchflower, who says the European Central Bank should try to stimulate growth rather than worry about inflation.

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