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Embattled American consumers are facing an even tighter fiscal squeeze after the US experienced the biggest increase in the cost of goods and services for almost three years.
US consumer inflation rise hits spending

Merrill Lynch chief executive John Thain said Monday if the company loses more money, it may have to raise more capital, leaving the door open to further capital raises if markets deteriorate, reports Reuters. Thain has been widely criticised by investors for repeated assurances the bank was well capitalised over the last eight months, only to raise more capital.
Thain says Merrill could raise more capital

More banks and financial institutions could end up being bailed out by governments before the credit crisis is over, Alan Greenspan, the former Fed chairman, warns in an article in Tuesdays FT. However, he cautions that a heavy-handed regulatory response would do more harm than good because it would depress global share prices.
Greenspan warns of more bank bail-outs

Morgan Stanley, the investment bank, has issued a major alert on the health of Spanish banks, warning that a replay of the ERM crisis in the early 1990s could wipe out the capital base of weak lenders exposed to the property crash.
Morgan Stanley issues alert on Spanish banks

Crude oil has tumbled below the $120 a barrel mark for the first time in three months as traders speculate that the slowdown in the global economy will hit demand. Oil's more than 3pc drop was also bolstered by hopes that Tropical Storm Eduoard will avoid the vast majority of the production facilities in the US Gulf coast.
Crude oil falls below $120 as US consumers weaken

Companies in Britain and Europe have failed to place a single high-yield bond since the credit crisis began a year ago, leaving them ever more vulnerable to a funding crisis as the region flirts with recession.
Europe's junk bond market in deep freeze

Fears of recession were heightened today as analysts braced themselves for dismal news from Britain's service companies after figures published yesterday showed that activity in construction plunged to an 11-year low.
Gloom over service sector fuels fears of recession

The latest survey by the Chartered Institute of Purchasing and Supply (CIPS) of the sector showed that construction activity contracted for the fifth successive month, with house building being especially badly hit down for the eighth month in a row and standing at a record low.
House building now at record low

British consumers are the grumpiest in the Western world, according to economists at BNP Paribas. Reviewing barometers of consumer confidence in Europe and the United States, they conclude that "if there was a competition for the country with the most pessimistic consumers, the UK would be the winner".
UK tops the ranks of global pessimists

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VIX

BROKERWATCH Imperial Tobacco upped to 'neutral' vs 'sell' at UBS, target 1,930pThe Tuesday Press RoundupLondon shares outlook - lower, commodity prices fall back, earnings news focus

Tokyo shares close lower for third day on caution ahead of FOMCThomson Financial UK at a glance share guide

BROKERWATCH Hammerson downgraded to 'neutral' in UK REIT review at JP Morgan

BROKERWATCH Royal Dutch Shell upped to 'overweight' at HSBC; tp 2,165 pence

BROKERWATCH Astrazeneca upped to 'neutral' from 'underperform at Merrill LynchTokyo shares close lower for third day on caution ahead of FOMC - UPDATE

UK smallcap opening - Delling firms on positive updateUK smallcap opening - Top Ten slides on swing to FY losses

UK smallcap opening - Chaarat Gold advances on positive drilling resultsLondon shares open weaker; Wall Street closes down; commodity stocks fall, BA up

STOCKWATCH Air France-KLM higher as Q1 profit falls less than expected

BROKERWATCH Novo Nordisk cut to 'underperform' from 'neutral' at Merrill Lynch

UK smallcap opening - AEA Technology gains on rights issue success

UK smallcap opening - AG Barr rises on earnings-enhancing deal & positive update

STOCKWATCH Legal & General rises on H1 operating profit gain; brokers positive

London shares open firmer; NY closes lower; Legal & General, BA gain UPDATE

STOCKWATCH Drax hit by falling H1 profits; brokers cautious on outlookBROKERWATCH HSBC cut to 'sell' from 'hold' by RBS, target 700p vs 840

UK small caps open easier; Top Ten hit by swing to FY losses

Metals - Platinum hits lowest since Jan, dollar pressures commodities

STOCKWATCH Standard Chartered higher after group beats analysts' forecasts

London shares - mid-morning features