08/04/2014 World Business Report

yet of finding dark matter. Now for the latest financial news.

Challenging times. Samsung forecast another fall in profits as it loses

ground to cheaper smartphones. The chief policymakers had to

Washington to discuss what to do to boost global growth.

Welcome to World Business Report. Let us start with Samsung, because

they are the world's biggest maker of televisions and mobile phones. It

is forecast to drop in profit for the second quarter in a row stop it

expects to take an operating profit of $7.9 billion. That is down from

the same period last year. It follows a 6% decline in operating

profit in the previous quarter. The company share price is nearly 12%

off from its record high. It is weighed down by worries over slowing

smartphone growth. We can speak to Lucy Williamson. What is behind the

struggling times? A large part of it is competing at the lower end of the

market. Chinese companies are growing in clout. We have seen

cheaper models come out from Samsung and its rivals. China promote and ``

a more affordable version. Saturation at the high end of the

market has been happening for some time. It is only going to get worse.

Samsung is starting to feel this. How is Samsung responding to this?

As I said, it is bringing out cheaper versions of its products,

more affordable versions, and scaling up some of the classics.

Also focusing on price. Cheaper prices designed to appeal to shift

more items and make up for the saturation of fact. Also reports

that Samsung is trying to cut back on its marketing. It spent a lot on

marketing. That is one area where Samsung feels it can cut back.

The world's top financial policymakers will descend on

Washington later for the twice yearly meetings of the International

Monetary Fund and World Bank. The debate is likely to be on what needs

to be done to boost global growth. With the US in recovery, much of the

focus is going to be on Europe and China and their ability to foster

sustainable growth. Over the next few days, the streets

around Washington headquarters of the International Monetary Fund and

the World Bank will be full of visitors. The IMF is one of the most

powerful players in the world economy. It is expected to tell

policymakers to do more to increase growth. The lender of last resort

says that five years after the start of the financial crisis and growth

remains too weak and too slow. Some of the obstacles to growth include

super low inflation, especially in Europe. Geopolitical tensions and

communication by central banks. Those inside this building would

like to see greater corporation between countries, especially to

developing economic policies. The economy may no longer be frozen, but

the economic buds are slow to bloom. The American results season is going

to kick off. Stock markets are nervous. Two chance of the Internet

world, Google and net Flex, were hammered. Yesterday the sell`off

continued. All closing down heavily. What is going on? Always

got to talk to you. What is going on? There is a sense that valuations

in the technology sector were getting too extended. There may be

some caution about the US economy. There is a consensus that the US

economy is in good shape and the recovery is continuing. The data is

not supported that. There's going to be some disappointment in the US

economy. Factor that in along with valuations. So it is the fact that

technology stocks and investors think that they have been

overvalued? Absolutely. There have been extended, not just in the US,

but other markets. Some argue that firms in the US, though they are

focusing on results, at earnings are not as much. That is the case. It is

all about the focus on the bottom line, cost`cutting, reorganisation.

There has not been investment to ensure that the economy remains

productive. You cannot just keep cutting costs. We are going to see

some disappointing results, particularly with the Federal

reserve unwinding stimulus. There may not be much to support stocks in

the US. It almost seems like a perfect storm. What are we expecting

from this stunning season? I think we will be surprised. But it will be

on the basis of the bottom line results rather than revenue numbers.

They may disappoint, but the bottom line results will look pretty good.

That is consistent with what I am saying. Cost`cutting to get the

bottomline to satisfy the numbers. But they are not doing anything in

terms of sales and investment. What about what is happening in European

and Asian markets? The flavour of the US trading day transmits through

Asia into Europe. We will have a weaker opening. There are issues

peculiar to Europe. Is there are going to be quantitative easing? If

they do not, quantitative easing is it prospect for Europe. That could

be positive. If markets are kept waiting, that will be a source of

disappointment. And emerging markets are still in focus. That is right,

they are suffering. A lot of extra cash was leaking into those markets.

Those countries with account deficits are really suffering. The

US will not be lifting interest rates any time soon. That will have

some support. Thank you. Time for a look at some of the

day's other business News. Support for the Windows XP operating system

and is today. No more official security updates and bug fixes for

the system. Some governments have negotiated extended support

contracts for the OS in a bid to keep users protected. Anyone else

using the software will be at increased risk of infection and

compromise. The boss of a private bank has been

shot dead in an underground car park in Lichtenstein. Detectives named a

former fund manager as a suspect. He may have taken his own life. He

calls himself the Robin Hood of Lichtenstein on his website.

Japan and Australia have agreed a trade deal which will see it though

tariffs on imports of key products. Japan has agreed to lower duties on

Australian beef and agreed to raise the duty free College of on cheese.

`` quota. Australia will cut tariffs on Japanese electronics, cars and

white goods. The deal is agreed after seven years of negotiations.

Let us take a look at the markets before I go. Plenty of talk about

what the markets are doing. This is what the Asian markets are doing.