Headlines

The price of Italian government debt has risen after the country’s government rebuffed a rebuke from Brussels over its spending plans but pledged not to expand the country’s deficit further after next year, the Financial Times reported. The yield on 10-year Italian government bonds dipped by 5 basis points to 3.41 per cent, extending a fall of 12 bps prior to the release of the statement. It was briefly down almost 30 bps just after the opening of trade. Its spread over the equivalent German Bund - a widely watched indicator of eurozone political tension - fell by 7 bps, to 293 bps.

The chief executive of Gatwick, the UK’s second busiest airport, has said he expects some airlines to fall into bankruptcy this winter following a number of recent failures, the Financial Times reported. “You will have a small number of airline failures,” Stewart Wingate told the Financial Times, adding that he did not anticipate any major airlines would collapse Gatwick experienced the failure of a major airline in 2017 when the UK’s Monarch went into administration. Last week, a small Cyprus-based carrier Cobalt Air failed.

A British peer-to-peer property lender has taken the unusual step of appealing to its regulator for help after one of its biggest borrowers threatened to sue the company and many of its investors, the Financial Times reported. Retail investors in Lendy are already facing tens of millions of pounds in potential losses after almost two-thirds of borrowers failed to repay their loans on time, according to a Financial Times analysis of its loanbook.

Italy’s Banca Monte dei Paschi di Siena has been sounding out investors to find potential buyers for new debt, bracing itself for the possibility it may need to take the expensive step if ordered to by regulators, the Financial Times reported. Managers at the lender met with investors in London earlier this month, in meetings arranged by JPMorgan, to update them on its progress just over a year after the Italian government rescued the world’s oldest bank.

Oil service company Solstad Offshore is seeking negotiations with creditors and other stakeholders to boost liquidity ahead of the slow winter season, the company said on Monday, sending its shares down around 20 percent, the International New York Times reported on a Reuters story. Solstad, with more than 4,000 employees, is one of the world's largest suppliers of specialised vessels to the oil and gas industry as well as offshore wind power developers. It has a fleet of 141 vessels.

The U.K.’s largest active manager is taking up arms against what it sees as an imminent liquidity crunch coming to credit markets, Bloomberg News reported. As bouts of late-cycle volatility prompt fears of an impending race for the exits, Aberdeen Standard Investments has been scooping up securities with greater liquidity relative to cash bonds, like credit default swaps.

Turkish banking stocks are on course for their worst year in a decade -- and third-quarter earnings reports starting this week will show why, Bloomberg News reported. Spiraling inflation, a surge in interest rates and a plunge in the lira amid tensions with the U.S. are battering the economy. Companies and individuals are finding it harder to repay their loans, causing bad debts to swell and eating into earnings as lenders increase provisions and bolster capital buffers to brace for more defaults.

The administrator of Kenya’s debt-laden ARM Cement will ask its creditors for support to keep the company running by selling some of ARM’s assets to cut debt, as well as a plan to engage with financiers for working capital, Reuters reported. George Weru, a co-administrator for the cement firm, told Reuters the proposals will be put to the company’s creditors on Tuesday when they meet to chart the best way forward. The company was put into administration in August by some of its creditors and its shares suspended from the Nairobi bourse.

The recent near-death experience of Patisserie Valerie and collapse of Conviviality, the bargain booze business, might make Chancellor Phil Hammond think again about all those rich tax breaks attached to shares on Aim, London’s junior market. Both were Aim darlings until Conviviality found a £30m unpaid tax bill, forcing it into administration in March, and Patisserie Valerie uncovered a similar-sized hole in its accounts this month, the Financial Times reported in a commentary.

Italian bonds and stocks dropped for a third day after the European Union ramped up criticism of the populist government’s budget draft, Bloomberg News reported. The nation’s 10-year yield spread over Germany, a key barometer for investor risk, touched the highest in more than five years following a letter from the European Commission to Rome that said its spending plans were excessive. The body still needs to give its official verdict on the budget, while S&P Global Ratings and Moody’s Investors Service could choose to cut the nation’s credit ranking before the end of the month.