World financial news

Stocks are rising after Tropical Storm Irene wound up being less severe than many analysts had anticipated.

The storm ripped through the East Coast and caused widespread flooding. Millions were still without power. However, a consulting firm predicted that insured damages would range between $2 billion and $3 billion, lower than initially estimated.

The New York Stock Exchange and other major U.S. exchanges opened for trading as usual Monday.

Shortly after the opening bell, the Dow Jones industrial average is up 170 points, or 1.5 percent, at 11,455. The S&P 500 is up 20, or 1.6 percent, at 1,197. The Nasdaq is up 42, or 1.7 percent, at 2,521.

Greek stocks jumped 15 percent after two major banks agreed to merge to better withstand that nation’s debt crisis.

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London police have arrested a 61-year old man in connection with the ongoing investigation into electronic eavesdropping of voicemail messages.

The man is the 12th person arrested in the scandal tied to the defunct British tabloid, the News of the World.

Detectives have been investigating claims the newspaper illegally eavesdropped on the phone messages of celebrities, politicians and even crime victims payday loan.

Those arrested in past include Murdoch’s former British newspaper chief Rebekah Brooks and Andy Coulson, an ex-News of the World editor who went on to be Prime Minister David Cameron’s communications chief.

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GE Healthcare, a maker of diagnostic imaging equipment, said Monday it is moving its X-ray global headquarters from the United States to Beijing as it seeks to tap China and other emerging markets.

The General Electric Co. unit is the first business of the industrial and financial giant to relocate to China.

Anne LeGrand, vice president and general manager of GE Healthcare Global X-Ray, told a news conference that the decision to move from Waukesha, Wisconsin, was made two years ago and will be completed by early fall.

She said “there is certainly the opportunity” to move other GE Healthcare units to China, but that is “something that we will continue to evaluate.”

The move involves LeGrand and a handful of her top managers. In an interview, she said they will add other people to the team as they expand in China, but no jobs will be lost.

The move follows an announcement last year that GE plans to invest $2 billion in China, including $500 million in six research centers, one of which GE X-ray is developing in Chengdu in central China. The company has already hired “close to 100 engineers” for the center in Chengdu, LeGrand said.

Rachel Duan, president and CEO of GE Healthcare China, said they plan to launch more than 20 new products in China over the next two years. Some 70 percent of those will be aimed at general medical professionals who make up the primary healthcare sector.

Duan said they will be developed for customers in China, “but we see a potential down the road for exporting to some of the other emerging markets.”

LeGrand said some of the products they had developed in China were now being sold elsewhere, such as the Ling Long digital X-ray, now being sold in Africa, the Middle East and Latin America. She said emerging markets represented “double digit growth” for GE’s X-ray business.

Over the past two decades, GE Healthcare China has focused on the high-end market in cities such as Shanghai, Beijing and Guangzhou and selling to large hospitals. Now they also intend to focus on the primary care sector in poorer parts of the country, including rural areas, Duan said.

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Dietician Maisie Vanriel won Moneyville’s blogging contest and will begin writing twice a week beginning in early July exploring smart food shopping, and things the food industry doesn’t want you to know. She will also be taking part in a 12-week challenge to reduce her family grocery spending.

Canadians can reduce their grocery bill and eat healthier food and they do not need coupons and special deals to do it. As a dietitian, I often teach healthier eating by teaching smarter shopping, because supermarkets have perfected separating you from your money and not always in the healthiest way.

Here are 5 things you may not know about grocery stores:

1. Why produce is misted.

The first thing you see when you enter many grocery stores is a colourful wall of fresh produce, sometimes being misted gently. It screams healthy. That wholesome look has been proven to result in $5 to $8 more in sales per visit.

So next time you go into a grocery store save the produce area for last. Start by walking past the cash registers and the rows of chips, candy and treats. I guarantee you will buy less. Nothing kills spending faster than the thought that the last thing your waistline needs is $5 worth of treats.

2. Why milk is at the back.

Most quick trips to the grocery store are for bread, milk and eggs, so marketers place these items at the back of the store hoping you will walk down an aisle and make an impulse buy. Avoid the temptation — just walk around the perimeter, pick up your bread, milk and eggs and leave.

3. Always try lower shelves.

If you must walk down an aisle it is easy to buy healthier foods and save money by choosing the foods you have to bend down or stretch up to reach. The shelf space at eye level is aimed at the average Canadian woman who is 5-foot-5. Since women do most of the grocery shopping manufacturers will pay thousands of dollars per store to own that space.

Take the cracker aisle; the least healthy, most expensive crackers are generally on the eye-level shelves. Choose healthier and less expensive crackers by just bending down or stretching up to reach them.

4. Featured specials aren’t so special.

Be wary of items that are “on special” or “featured” at the front of an aisle. Notice they don’t always say “on sale,” because often times they are not. A “featured” cereal may be exactly the same price as it is in the aisle, just placed in a more prominent spot to increase sales.

5. Watch for “me too” items.

The front of the aisle is also a favourite spot for what I call “me too” items. A more expensive cereal is “accidentally” placed next to the featured cereal, and only when you get to the checkout do you find out it is more expensive. Most shoppers just keep it rather than go back to change it. Next time avoid those featured areas.

It may not seem like much but remember, “look after your pennies and the dollars will take care of themselves.” It is often the mundane day-to-day activities like grocery shopping where people are most easily parted from their money.

Also read:

New blogger to cut food spending 15%

Maisie Vanriel is a nutritionist with the Region of Peel in the Toronto area. She has a degree in Nutritrion and Food Science and has been a cook since the age of six.

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Ads that are clever and actually help sell the product? What a novel idea.

This weekend at the Oscars of advertising, a festival in Cannes, France, judges for the first time will give an award for effectiveness _ evaluating ads for whether they sell more computers or deodorant, not just whether they make people laugh, cry or cringe.

The award, to be handed out Saturday at the Cannes Lions International Festival of Creativity, signals a shift toward accountability, and comes at a time when advertising agencies are fighting for every dollar they can get.

Corporate marketing budgets were slashed by 8 percent during the Great Recession, and that spending still hasn’t come back, according to Zenith Optimedia, a research division of communications giant Publicis Groupe.

“You have to prove you got someone to pay attention and act, particularly in this economy,” said Chris Kempczinski, Kraft Foods’ senior vice president of marketing, who helped judge the category.

Cannes told agencies making submissions that to win in the effectiveness category, an ad had to show a proven impact on “consumer behavior, brand equity, sales, and where identifiable, profit.” Judges combed through more than 150 nomination forms audited by PriceWaterhouseCoopers.

The 10 finalists, announced Friday, include four campaigns from the United States and three from the United Kingdom.

Some were obvious picks, like Apple’s Mac-versus-PC campaign, in which two men, one uptight and the other hip, role-play as the equipment. Others had subtler impact, such as one for Hasbro’s online game “Monopoly City Streets,” where players built virtual properties on Google Maps, then collected rent.

Industry insiders say the front-runner is a campaign for Old Spice men’s body wash called “The Man Your Man Could Smell Like.” The commercials, made by the Portland office of agency Wieden+Kennedy, feature a muscular man _ shirtless more often than not _ who repeatedly tells female viewers to look over at her man _ then at him.

“Sadly, he isn’t me,” he says in the spot, “but if he stopped using lady-scented body wash and switched to Old Spice, he could smell like he’s me.”

The ad created buzz for Procter & Gamble, which makes Old Spice. The first commercial in this campaign got 40 million YouTube views in a week. The spot was parodied dozens of times, including by Grover on “Sesame Street.” The star, Isaiah Mustafa, made the talk show rounds and appeared on “The Oprah Winfrey Show” and “Ellen.”

A response campaign consisting of more than 180 YouTube videos in which Mustafa addresses viewers’ comments directly got 5 payday loans.9 million YouTube views in its first 24 hours, more than President Barack Obama got for his election-night victory speech, Wieden+Kennedy says.

“It was a magic moment kind of thing,” says Mark Fitzloff, an executive creative director at the Portland agency.

But that won’t be enough by itself to convince the Cannes judges, who are more concerned with business results. The Old Spice spot will have to be deemed more effective than ads for Snickers and Axe shower gel, among others.

“Who cares about brand buzz?” says judge Tim Broadbent, Global Effectiveness Director at Ogilvy & Mather. “We wanted to know, could you prove to a skeptical finance director that it worked?”

Marc Pritchard, who oversees P&G’s $8.6 billion marketing budget, says yes. Before the campaign, the brand was facing huge challenges, he says. Old Spice was seen as, well, old. And most men were perfectly content to clean themselves with soap.

But that’s changed. Old Spice body wash sales grew 27 percent in the six months after the campaign launched, making it the top seller in the category.

The weeklong festival honors the most creative work from around the world in film, radio, print and outdoor advertising. Twelve of the 13 main categories will still be about presentation _ how funny, shocking or quirky the ads are.

In years past, when that was all the judges had to worry about, winners included Bud Light’s 2004 “Real Men of Genius” campaign, mocking men who commit faux pas like wearing too much cologne.

For traditional ad firms facing challenges from scrappy digital upstarts, it’s important to be able to demonstrate to clients like P&G that a full-fledged multimedia campaign featuring highly produced television commercials is a better investment than a viral video shot on a handheld camera.

After all, it can cost $2 million to produce a 30-second television commercial and an additional $10 million to buy the ad time for a national campaign in the U.S., Kraft’s Kempczinski says. Companies expect to get their money’s worth, especially because budgets are still tight.

“I think the idea that creatives should be shielded from commercial reality is insane,” Broadbent says. “Cannes is growing up.”

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Why isn

Why buy a bookstore?

John Malone, who made a fortune in cable television, is offering $1 billion for Barnes & Noble _ trying to jump into a business so sick that its No. 2 competitor, Borders Group Inc., is on life support.

The difference is that Malone and his Liberty Media conglomerate aren’t betting on the books-and-mortar past, analysts say, but the promise of the electronic future.

Barnes & Noble’s Nook electronic reader now accounts for 28 percent of the market for those devices. And the Nook has the potential to go beyond books to deliver all types of digital products, including music, magazines, TV shows and movies. That makes it a competitor not just to Amazon.com’s Kindle but also to Apple’s iPad.

“This deal is all about the device,” said Sherif Mityas, a partner in the retail practice of global management consulting firm A.T. Kearney. “As Apple proved, you need to have the content and the device. Malone has the content, and Barnes & Noble has the device. You’re not buying the stores; you’re buying the Nook.”

Malone’s empire, Liberty Media Corp., operates three publicly traded companies _ Liberty Interactive Inc., Liberty Starz Group and Liberty Capital Group _ through which it runs home-shopping network QVC and movie channel Starz. It also holds stakes in numerous other online, media and communications companies. Some believe that QVC could be used as a marketing vehicle for Barnes & Noble’s Nook.

With the backing of a media conglomerate, Barnes & Noble’s digital business would be able to compete better with Amazon, Apple and others, said Gary Balter, a retail analyst at Credit Suisse.

Barnes & Noble’s 700 stores may appear to be an albatross. But they could be transformed into places that highlight mostly digital devices and content and mimic Apple’s successful stores. Barnes & Noble has already cleared space at the front of its stores to display the Nook and push e-books.

“You don’t want the old-fashioned bookstore customer who goes in and sits and reads a book for two hours. You want people going in there who are hungry for experience,” said Richard Hastings, a consumer strategist with Global Hunter Securities.

Barnes & Noble’s shares surged almost 30 percent on Friday and passed Liberty’s bid of $17 a share in cash, closing at $18.33. The companies haven’t yet signed an agreement, and the deal is still subject to closing conditions, including one that founding Chairman Leonard Riggio keep a stake in the company and remain in a management position, Barnes & Noble said.

Barnes & Noble reiterated Friday a committee of its board is evaluating the offer.

Barnes & Noble had put itself up for sale in August in response to pressure from billionaire activist shareholder Ron Burkle, but the company didn’t find much interest.

Traditional book sellers have been facing increasing competition from online retailers like Amazon.com and discounters like Wal-Mart Stores Inc. And heavy readers are quickly embracing e-books.

Right now, though, Simba Information senior trade analyst Michael Norris estimates there are still at least five print book buyers for every e-book buyer cash advance to savings account.

Still, the industry thinks e-books are the future. Amazon.com said Thursday that, after less than four years of selling electronic books, it’s now selling more of them than printed books. Stores have cut shelf space devoted to printed books by 15 percent over the past year, estimated Mike Shatzkin, CEO of Idea Logical, a book consulting company. Last year, he predicted that it would take five years for stores to cut space for printed books by 50 percent; now, he believes it will only take about three.

The shift has already rocked Borders Group, which filed for bankruptcy court protection in February. It has been closing stores and is reportedly in talks to sell more than half of those that remain.

While Barnes & Noble has done better than Borders, its quarterly results have been weighed down by large investments in its online and e-reader businesses. Barnes & Noble reported growth in its online store in the most recent quarter, and said both that and its bricks-and-mortar stores were helped by sales of its Nook e-reader.

Last month, Barnes & Noble added an app store and an e-mail program to its Nook Color e-reader. That brings the $249 device closer to working like a tablet computer like the iPad, which sells for twice as much. Barnes & Noble is expected to announce a new version of the Nook next week, though it hasn’t said what features it will include.

Clearly, there are concerns. Norris says he would like assurance from Liberty that it’s not going to look at the Nook in “a vacuum” and get rid of the stores.

“Its success has been (tied) with the physical bookstores because people are not giving up physical books,” he added.

No one know knows exactly what Malone, 70, has in mind. He has typically been a pure investor, like Warren Buffett or a private equity firm, who buys companies when they are cheap and on the brink of financial ruin.

Malone doesn’t have a history of putting together grand technological schemes, said Wedge Partners analyst Martin Pyykkonen. He called Malone a “financial engineer” who demands excellent returns, keeps management in place and reaps rewards when the business returns to health.

It could be there is no grand plan with Barnes & Noble, either, besides closing unprofitable stores and otherwise improving profitability. One thing that is similar with other Malone investments is Barnes & Noble’s big share of its market, which could get bigger if Borders Group closes or sells more stores.

“Malone’s style is to very quietly, very patiently look and watch, and when things get to his threshold level, then make his move,” Pyykkonen said. “But he makes his move in a generally quiet, friendly, cooperative way, because he actually wants management to stay in there and keep running the company.”

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The operator of the Hamaoka nuclear power plant in central Japan says it has agreed to the government’s request to close the facility.

Chubu Electric Power Co. convened a special board meeting Monday to decide whether to accept Prime Minister Naoto Kan’s directive to close the plant’s three reactors while the company builds new safety features.

The facility about 125 miles (200 kilometers) west of Tokyo is known as Japan’s “most dangerous” plant because it sits in an area where a major earthquake is expected within three decades instant payday loans.

The government reached its conclusion after evaluating the country’s 54 reactors for quake and tsunami vulnerability after the March 11 disasters that heavily damaged the Fukushima Dai-ichi plant in northeast Japan.

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Kellogg Co.’s first-quarter net income fell 12 percent as the world’s biggest cereal maker dealt with higher ingredient costs and spent more on marketing and new products.

Kellogg shares fell $1.04 to $56.40 in premarket trading.

The maker of Frosted Flakes and Special K earned $366 million, or $1 per share, for the period ended April 2. That’s down from $418 million, or $1.09 per share, a year earlier.

Analysts predicted earnings of $1.04 per share.

Kellogg said the results don’t fully reflect price increases it has made. It raised its full-year revenue outlook to an increase of 4 percent, expecting it will benefit from higher prices.

The cereal maker, like much of the industry, faces rising costs for ingredients and freight as prices for grain and fuel have both soared this year no fax payday loans. In turn, it has tried to pass on some of the cost increases to its customers.

Revenue climbed 5 percent to $3.49 billion on sales increases in North America and overseas, surpassing Wall Street’s $3.39 billion.

Kellogg still expects full-year earnings to climb in the low single-digits, implying earnings of $3.33 to $3.40 per share with no foreign exchange impact. Analysts expect $3.48 per share.

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Stocks are closing higher after Federal Reserve Chairman Ben Bernanke said central bank officials expect the economy to continue recovering this year as the jobs market strengthens.

The Fed expects the economy to grow between 3.1 percent and 3.3 percent this year. That’s below the Fed’s previous forecast in January, but the Fed also said it’s more optimistic about the unemployment rate going lower.

The Dow Jones industrial average rose 96 points, or 0.8 percent, to close at 12,691 Wednesday.

The Standard & Poor’s 500 rose 8, or 0.6 percent, at 1,356. The Nasdaq composite index is up 22, or 0.8 percent, at 2,870.

Three stocks rose for every two that fell on the New York Stock Exchange. Volume was 4.2 billion shares.

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