:00:03. > :00:13.with the Queen. Those are the latest headlines from BBC News. Now
:00:13. > :00:15.
:00:15. > :00:20.for the latest financial news with Sally.
:00:20. > :00:24.This is World Business Report. The headlines: Subpoenas for seven of
:00:24. > :00:29.the world's biggest banks as US authorities investigate the alleged
:00:29. > :00:33.fixing of the so-called LIBOR interest rate.
:00:33. > :00:38.Foreign direct investments in China for in July as economy continues to
:00:38. > :00:43.feel the pinch of slowing growth and the European debt crisis.
:00:43. > :00:53.Early investors in Facebook can sell their shares today as the
:00:53. > :00:57.
:00:57. > :01:01.post-flotation lock-up period ends. There is no let up in the ongoing
:01:01. > :01:06.troubles for the banking industry as US authorities confirm they have
:01:06. > :01:11.issued subpoenas to seven banks over claims they manipulate and the
:01:11. > :01:17.LIBOR interest rate, the rate at which banks lend to each other. The
:01:17. > :01:20.banks are Barclays, Citigroup, Deutsche Bank, JP Morgan Chase,
:01:20. > :01:24.HSBC, Royal Bank of Scotland and UBS. We will be getting analysis of
:01:24. > :01:29.what this means in a mannered but first week here is an explanation
:01:29. > :01:32.from our New York Business Correspondent. -- in a moment.
:01:32. > :01:36.The Attorney generals for New York and Connecticut have issued
:01:36. > :01:41.subpoenas to seven leading banks. A subpoena is a request for
:01:42. > :01:47.information backed by the force of law. State authorities in benighted
:01:47. > :01:53.states are involved because LIBOR is used to set the rate of interest
:01:53. > :02:01.one state and municipal bonds. And so manipulation of LIBOR could have
:02:01. > :02:05.caused the state's huge losses. Barclays has already agreed to pay
:02:05. > :02:10.a $450 million penalty. The latest developments show that the Net is
:02:10. > :02:14.being spread much wider than Barclays to many other banks, and
:02:14. > :02:19.that local authorities in the United States as well as national
:02:19. > :02:25.regulators in Britain and the US are involved.
:02:25. > :02:29.Let's get some more analysis from a banking analyst. We'd did know when
:02:29. > :02:33.his first came to light at Barclays that more banks will be named.
:02:33. > :02:37.Yes, but we did not know that all of them will be named and shamed at
:02:37. > :02:41.the same time. The general consensus was that we would see a
:02:42. > :02:45.trickle effect, one every three or four months. We did not expect to
:02:45. > :02:50.see them at the same time. It has been a bit of a shock. What is the
:02:50. > :02:56.impact? This is coming from the US again, which was the top story
:02:56. > :03:03.yesterday. The US has an easier time doing this because in new York
:03:03. > :03:06.it is not required to show intent. That means they did not show that
:03:06. > :03:10.they -- did not have to show that they did this to intentionally hurt
:03:10. > :03:17.people. But it does appear they are going after foreign banks more than
:03:17. > :03:20.domestic ones. But we have to give them the benefit of the doubt. I
:03:20. > :03:25.think we are seeing more from an external perspective. And the focus
:03:25. > :03:30.on London because we're talking about the London interbank lending
:03:30. > :03:33.rate set in London by a series of banks. It is under review by the UK
:03:33. > :03:36.government will stop it is going to be changed. It will be changed but
:03:36. > :03:42.it is not a trivial thing. It will take a long time to change because
:03:42. > :03:46.there is so many things involve. In the US there are 900,000 mortgages
:03:46. > :03:52.linked to this one rate, this one very small rate. Making that kind
:03:52. > :03:56.of change will probably be it a five-year programme.
:03:57. > :04:00.A lot more on the website about that story.
:04:00. > :04:04.Let's move on. Wal-Mart is reporting its second-quarter
:04:04. > :04:07.results today with the recovery in the US still fragile. Investors
:04:07. > :04:15.will be watching the numbers for any indication of how American
:04:15. > :04:19.consumers are feeling. Wal-Mart is pushing its back-to-
:04:19. > :04:23.school offerings to attract American shoppers. Third by
:04:24. > :04:27.mistakes in the past including removing popular products, the
:04:27. > :04:33.world's biggest retailer has gone back to its relentless focus on
:04:33. > :04:38.value for money. That strategy appears to be paying off, with its
:04:38. > :04:42.crucial US business gaining momentum. Wal-Mart focuses on a
:04:42. > :04:49.lower income consumer who has less flexibility in terms of overall
:04:49. > :04:53.spending. They have benefited from reduced gas prices we have seen.
:04:53. > :05:02.Slightly declining an incitement rates, especially in the lower
:05:02. > :05:06.income job market. -- unemployment rate. And oversees its business has
:05:06. > :05:11.remained strong, but Wal-Mart continue to deal with allegations
:05:11. > :05:15.of bribery in its Mexico operations. Executives at the retail giant were
:05:15. > :05:24.sued over the handling of the affair by a group of New York City
:05:24. > :05:30.pension funds. We don't sit idly by when huge exposes of potential
:05:30. > :05:35.bribery of foreign officials and even worse, cover ups by company
:05:35. > :05:39.directors and executives, may have taken place. Most investors will be
:05:39. > :05:44.focused on what Wal-Mart has to say about their consumers.
:05:44. > :05:48.Low income shoppers to struggle to pay their bills. Americans are
:05:48. > :05:52.starting to open their wallets. They spent more into line and they
:05:52. > :06:02.have in the past five months. But given the fluctuating recovery many
:06:02. > :06:04.are waiting to see what Wal-Mart has to say.
:06:04. > :06:09.Facebook's early investors and a handful of directors are able to
:06:10. > :06:15.sell stock. They are able to sell stocks their own in the company
:06:15. > :06:19.today. The so-called lock up period, which prevents them from unloading
:06:19. > :06:24.shares, will expire. Facebook shares have already plummeted by
:06:24. > :06:32.almost half since its initial public offering. Are they set to
:06:32. > :06:37.fall further? Let's get more detail. We can join via the Web can from
:06:37. > :06:40.the US Peter Zhang Nan, an investor who has been involved in several
:06:41. > :06:45.successful internet companies. What do you think will happen today? Do
:06:45. > :06:50.you think we will see a flurry of shares coming to market? I think we
:06:50. > :06:56.will see a lot. We are looking at 285 million shares. There is a
:06:56. > :07:00.large number. But I think that the battering the Facebook shares have
:07:00. > :07:03.taken in the past three months have actually helped for today.
:07:04. > :07:08.Investors who have a very large number of shares would not want to
:07:08. > :07:13.let them go at this price. If Facebook was trading at 30 or $31,
:07:13. > :07:17.I think we would see a massive move. We will see some movement no
:07:17. > :07:23.question. Some people will want to get rid of them at any price as
:07:23. > :07:30.quickly as possible. But in terms of the massive hammering, I don't
:07:30. > :07:34.think it will be that bad. What is just perspective on how this has
:07:34. > :07:40.gone for Facebook? There is so much commentary. There are those that
:07:40. > :07:45.feel it was massively overpriced and was doomed to be a disaster but
:07:45. > :07:50.there are others who say, this is a long-term story. I heard a great
:07:50. > :07:54.analogy the other day when they compared it to the last long waited
:07:54. > :07:57.episode of a TV series that has gone on for eight years and they
:07:57. > :08:01.say they're going off air, they build up hype, there is no way it
:08:01. > :08:06.can reach what everybody has imagine. Facebook has the ability
:08:06. > :08:10.to grow. They have markets. But am a lot of work to do. They still
:08:10. > :08:16.have not created a mobile strategy. There is a lot of things they must
:08:16. > :08:19.do. I think the frenzy was so great, everybody saw Facebook as the next
:08:19. > :08:27.big, big thing. They did not really think, you know, it is still a very
:08:27. > :08:34.young company and as a lot to do. Irrational exuberance that we saw
:08:34. > :08:37.back in 2001 has gone away. -- and the rational. It has a lot of room
:08:37. > :08:43.to grow. We're going to see and hit today but it will not be the end of
:08:43. > :08:48.days for Facebook. 0 OK. Thanks for your analysis.
:08:48. > :08:51.More evidence today that the slowdown in China it is continuing.
:08:51. > :08:57.There has been a steep fall in foreign direct investment into the
:08:57. > :09:03.world's second-biggest economy. Tesco to Rico Hizon in Singapore. -
:09:03. > :09:06.- let's go to. What is happening in China? Not a good sign. A steep
:09:06. > :09:12.decline for foreign direct investment in July as the economy
:09:12. > :09:18.continues to feel the pinch of the slowing global economy and of the
:09:18. > :09:23.European debt crisis. The mainland attack that $7.6 billion in s b r i
:09:23. > :09:27.s, down close to 9% compared to the same period last year. For the
:09:27. > :09:31.first seven months of 2012 foreign direct investment amounted to $66
:09:32. > :09:34.billion, 4% lower from the same time one year ago. Analysts are not
:09:34. > :09:40.optimistic about the second half of the year. They are forecasting a
:09:40. > :09:44.further slowdown in foreign direct investment.