Morning business round-up: Markets wait on debt deal

  • Published

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

European markets opened nervously this morning as investors waited on the progress of US debt talks.

The White House has warned that President Obama could veto a debt limit plan proposed by top House Republicans.

Meanwhile, Speaker John Boehner's plan to trim public spending and raise the limit met with resistance from rank-and-file members of his own party.

A House of Representatives vote on the plan was delayed from Wednesday after doubts arose over the cuts it proposed.

Spanish-owned UK airports operator BAA has reported smaller losses for the first half of the year after more passengers used its airports.

The company reported a pre-tax loss of £249m in the six months to 30 June, compared with a £279.7m loss last year.

German drugs and chemicals firm Merck has cut its profit forecast for the year after its second-quarter earnings were hit by one-off charges.

Merck faced integration costs related to its two major acquisitions Serono and Millipore, as well as impairment losses related to some drugs and a writedown in the value of some patents.

It now expects an operating profit of 1bn euros ($1.45bn; £880m) for 2011.

Media caption,

Biz Heads

In Asia, Australia's consumer prices rose more than forecast in the second quarter of the year as the high cost of food and fuel caused inflation to accelerate.

Prices rose by 3.6% in the three months to the end of June from the same period last year, the latest data showed.

Food prices have been rising due to the devastation caused by floods and cyclones earlier this year.

South Korea's economic growth slowed in the second quarter as exports and manufacturing weakened.

The annual rate of growth was 3.4% in the three months to the end of June, down from 4.2% in the previous quarter. Quarter-on-quarter growth was 0.8%.

The slowdown comes as demand from key markets such as the US and Europe has been hit by a slower economic recovery and debt concerns.

Japanese car maker Nissan reported that its net profit fell 20% in the April to June quarter in the wake of the 11 March earthquake and tsunami.

Japan's carmakers were badly hit as the disasters disrupted car production and destroyed dealerships.

There was some better news from China. Shares of Sun Art Retail Group surged on their debut on the Hong Kong stock exchange as investors were optimistic that consumer demand in China will grow further.

Sun Art saw its shares jump as much as 41% to HK$10.18 from the initial price of HK$7.20, in early trade.

The boss of the world's largest steel maker, Arcelor Mittal, has waded into the debate on the future of the world economy.

He's forecast a seasonal dip in the third quarter, but said there would be no repeat of the pronounced slowdown seen last year.

Steel makers were hit hard during the financial crisis as construction and car sales plunged.

The forecast came as the company announced an 11% drop in second-quarter net profit to $1.54bn (£937m)

With worries increasing about debt crises in America and in Europe today's Business Daily podcast from the BBC World Service asks Andrew Balls of the worlds largest bond investor, Pimco, what it all means.

Around the BBC