08/08/2012 World Business Report

BBC World is. It is now time for World Business

Welcome to the programme. Investors await a quarterly result from News

Corporation has it tries to repair the damage from the phone hacking

scandal at its British newspapers. Standard Chartered banking shares

are volatile on the Hong Kong stock exchange, amid reports the bank may

have to pay as much as $700 million to resolve money-laundering

allegations. Pass, fears of a new food crisis as

dry weather hits the fields of Russia. Drought in the US Midwest

has already pushed grain prices to News Corporation, the global media

giant controlled by Rupert Murdoch, releases quarterly results later

today after the close of US trading. Analysts expect earnings and

revenue to be down on a year ago. The main interest may be what the

company says about its plan to divide itself into two publicly

traded companies - one for its TV interests and the other for its

publishing companies. It is being split in the shadow of the scandal

over phone hacking at its British newspapers.

Rupert Murdoch's British newspaper empire has yet to emerge from the

scandal. Senior executives have been charged with criminal offences,

including former UK boss Rebekah Brooks. Now, in a new bloke, the

Church of England has sold its shares, saying News Corporation has

not done enough to reform. The company's American investors do not

seem to care too much about these ethical concerns. Despite all the

scandals and everything that has occurred over the past quarter and

12 months, News Corp has found a way to make money and that is what

investors like. Increasingly, the valuable assets of the companies do

not include newspapers. News Corporation's American publications

include the New York Post and the Wall Street Journal. In newspaper

terms they are bigger provide a lot of political cloud. As businesses,

in terms of profit and loss, they are tiny in relation to the

company's other media assets. Much of the series profits and revenue

come from Fox Television and the movie studio Twentieth Century Fox.

Despite the odd setback, all media firms like News Corp can still come

to be reliable money-making machines. Unlike some of the new

ones. Fox Broadcasting in a matter of three weeks made $2 billion in

advertising revenue. That is more than half of what Facebook gets in

a year. It is about to be split in two, its reputation has been

thrashed by scandal. But for many investors, News Corporation still

delivers reasonably well where it counts, on the bottom line.

Some $17 billion were wiped off the value of Standard Chartered

yesterday after US regulators accused the Bank of scheming with

Iran to launder money. How were they doing in Asian trade? How

large the shares doing? If you take a look at the Standard

Chartered stock price chart, it has been a very volatile day so far for

the UK lender. In early Hong Kong Trade, the share price extended its

fall by another 1.3% on top of the more than 6% downturn yesterday. In

midday trading on the strength of financial shares in the region, the

UK lender's stock has turned around with the price now up by about 1%.

Traders say investors are seen to have absorbed the bad news and with

the bank denied claims that it hit $250 billion in deals with Iranian

banks for almost a decade, which is in violation of US sanctions. I

wholly aspire to Emmanuel Daniel and asked him if this could be

affected by these allegations. Technically not be closed today

banks need to be incorporated locally in many of the major

countries. In the case of Standard Chartered it is incorporated in

Hong Kong and some of the south- east Asian countries. There is a

way to ring-fence those businesses from what is happening in the US.

There are now media reports that Standard Chartered might be asked

to pay as much as $700 million to resolve money-laundering

allegations. If confirmed, the settlement would match the amount

that HSBC set aside last month after a Senate committee found the

bank gave terraced, drug cartels and criminals access to their banks.

With the US already facing its worst drought for 50 years, prices

of many greens and food crops have soared on world commodity markets.

Traders will be watching Russia closely today, when a newly formed

commission on food security needs in response to dry weather that has

halved grain yields in some areas of the country. There is market

talk that Russia might respond by limiting or stopping exports, as it

did to make years ago, putting prices further higher. The European

Business correspondent has more. It is not a disastrous crop like

the year before last, but wheat yields are half what they should be

on many drought-hit Russian farms. It is the job of the new commission

to take soundings today. It is the state which may decide whether more

grain should be held back from export markets. Producers seem to

be choosing not to sell but are holding on to the stocks were now

in the hope that prices will go even higher. TRANSLATION: Now the

harvest is going on we are putting that the entire global industries

keeping an eye on the climate. The UN is hoping they will not be a

repeat of fast food riots in places like Somalia and Egypt. India is

braced for a possible shortage of animal feed. A key US government

report this Friday should Quan defied the latest crop damage. This

farm in Nevada last three-quarters of its farm crop. Ian Harte is

managing editor of a publication that tracks commodity prices.

need to see how the weather goes for the US soybean crop. Whether

Russia decides to ban all but export duties on to its wheat

exports. Some of these things could send us into uncharted territory.

We have already seen record prices. What I think has happened is that

those records are only slightly higher than the highest levels we

have ever seen. We are a bit more used to this territory now than we

were two or three years ago. Here in northern Europe, thanks to the

summer rains, it is not so much the quantity, but the quality of the

crop which is in question. Whatever the Russians decide, protecting the

world's poorest from the impact of these record prices may be

impossible. A quick look at what else is on the

business agenda for today. The Bank of England may slash its forecast

for growth of bed inflation in the UK when it presents its quarterly

report later. It raises expectations that it will act again

to stimulate Britain's economy. Last month the Bank restarted its

programme of buying government bonds with newly printed money.

Since then the figures had shown the UK is deeper in recession than

previously thought. Cathay Pacific Airways has posted a

loss of $120 million for the six months to June. The carrier is

struggling like its rivals because of stubbornly high jet fuel prices,

falling passenger yields and lower cargo volume.

A quick look at the market. As you can see, they are mixed. On the