:00:00. > :00:00.Those are the latest headlines from BBC World News. Now for the latest
:00:00. > :00:19.financial news with Sally Bundock and world Business Report. In the
:00:20. > :00:21.US, earnings season gets into full swing but while the economy is
:00:22. > :00:27.stronger, are company earnings keeping up the pace? Revving up big
:00:28. > :00:38.engines - as the global economy improves, the appetite for luxury
:00:39. > :00:44.sports cars is back. Welcome to world Business Report. I'm Sally
:00:45. > :00:47.Bundock. Also in the programme - as Japan's Prime Minister wraps up his
:00:48. > :00:51.tour of Africa, we assess how successful it has been. It's
:00:52. > :00:54.earnings season and today JP Morgan Chase and Wales Fargo are the first
:00:55. > :01:01.two of America's largest banks that will kick off the year-end reporting
:01:02. > :01:04.in America. While the US economy is clearly improving, it's not at all
:01:05. > :01:15.obvious that company earnings are also on the up. Samira Hussain
:01:16. > :01:20.reports from New York. JP Morgan, bank of America, Citigroup, Wales
:01:21. > :01:27.Fargo, Goldman Sachs, Morgan Stanley, six of America's largest
:01:28. > :01:31.banks, combined they made almost 75 billion dollars in profits. Many
:01:32. > :01:35.banks have been cutting expenses and releasing money set aside for bad
:01:36. > :01:41.loans. But the profits big banks made last year had not been seen as
:01:42. > :01:46.the peak of the US housing bubble in Nest Labs thousand and six. In the
:01:47. > :01:52.last 12 months, the share price will some of America's largest banks have
:01:53. > :01:56.gone up anywhere from 25 to 35%. It was a big driver for some of the
:01:57. > :02:01.record highs been in US markets in 2013. This year that good cheer may
:02:02. > :02:07.not continue for financial institutions. One thing banks cannot
:02:08. > :02:12.rely on that they could last year was the low interest rates and a lot
:02:13. > :02:19.of homeowners were refinancing mortgages. Interest rates rose in
:02:20. > :02:23.summer, banks are not getting that source of profit anymore. Further
:02:24. > :02:27.hurting banks, regulators are finally going up the financial
:02:28. > :02:31.institutions that sold mortgage-backed securities. Those
:02:32. > :02:37.faulty lines lead to the collapse of the US housing market and the
:02:38. > :02:41.financial crisis. JP Morgan is paying $13 billion to settle charges
:02:42. > :02:47.and others will soon follow, including the bank of America,
:02:48. > :02:52.expected to pay the steepest fine. Mortgage-backed securities, the
:02:53. > :02:55.instruments that drove banks to record highs may be the same ones
:02:56. > :03:06.that will temper profits this season. The US Justice Department
:03:07. > :03:11.has charged three former traders of a Dutch company with fraud, accused
:03:12. > :03:16.of manipulating the libel interbank lending rate over a five-year period
:03:17. > :03:20.in Nest Labs thousand and 11. They played $1 million last year to
:03:21. > :03:29.settle investigations into rate rigging. For other banks have been
:03:30. > :03:32.punished over the scandal. Google has announced plans to buy
:03:33. > :03:34.thermostat maker Nest Labs for $3.2 billion. This latest deal continues
:03:35. > :03:37.a string of recent acquisitions. California-based Nest Labs was
:03:38. > :03:39.founded by two former Apple executives. It produces a thermostat
:03:40. > :03:42.capable of learning user behaviour and working out whether a building
:03:43. > :03:46.is occupied or not, using temperature, humidity, activity and
:03:47. > :03:48.light sensors. A draft law has been proposed in the Netherlands that
:03:49. > :03:51.would force convicted prisoners in Dutch jails to pay rent for their
:03:52. > :03:56.cell. The government wants inmates to pay 16 euros a day for a maximum
:03:57. > :04:06.of two years - a fraction of the real cost. As the global economy
:04:07. > :04:09.recovers, car buyers are increasingly willing to spend money
:04:10. > :04:16.on more luxurious rides - a trend auto makers expect to continue in
:04:17. > :04:20.2014. And the high-end buyer is getting younger, especially in Asian
:04:21. > :04:24.markets. Michelle Fleury is at the Detroit Motor Show for us and takes
:04:25. > :04:36.a look at the appeal of this segment of the market to both consumers and
:04:37. > :04:39.manufacturers. Mix together a dash of retro with high-tech engineering
:04:40. > :04:45.and you have a Porsche the carmaker vote will keep its showrooms busy.
:04:46. > :04:53.Porsche and it is competitors are coming off a strong year for sales,
:04:54. > :04:57.what is the secret? Brand is number one, it is supported by product and
:04:58. > :05:03.product as technology. The chief executive of Daimler pointed to the
:05:04. > :05:08.new Mercedes C class to prove his point. This vehicle has lots of
:05:09. > :05:12.assistance systems which include stop and co-pilot which allows you
:05:13. > :05:17.to go up to 20 miles an hour, hands-free. Without feet on the
:05:18. > :05:24.pedal. The card will do the job for you. That has been science-fiction a
:05:25. > :05:27.few years ago, it is reality now. A few miles from the Detroit Motor
:05:28. > :05:32.Show, this dealership has seen Land Grover sales jumped 35%. It comes to
:05:33. > :05:38.luxury, not just science that brings people through door. Definitely an
:05:39. > :05:43.emotional purchase. Not something that people need to go out and buy
:05:44. > :05:46.because they have to get transportation to work. People
:05:47. > :05:52.become attached to these cars. That is a status symbol that is very
:05:53. > :05:55.important to them. Emotions do not know borders as car makers see
:05:56. > :06:01.plenty of opportunities in emerging markets. The outlook generally is
:06:02. > :06:10.very good. We have emerging market that have got an appetite. You look
:06:11. > :06:15.at markets like China, and the Asia is very strong. Even though car
:06:16. > :06:21.companies will not say it too loudly, the most of thing about
:06:22. > :06:25.luxury models are that they are the most profitable that manufacturers
:06:26. > :06:36.sell. In the car business, the most expensive ride is the one that puts
:06:37. > :06:39.you in the fastest road to riches. Japan's Prime Minister, Shinzo Abe,
:06:40. > :06:43.is in Ethiopia for the final stage of an African tour which has also
:06:44. > :06:45.seen him visit Mozambique and Ivory Coast. It's the first time a
:06:46. > :06:49.Japanese leader has visited the region since 2006. For more, we're
:06:50. > :06:58.joined by Babita Sharma is in Singapore. Tell us more about this
:06:59. > :07:08.trip, when he set off a week ago, lots of expect patients, deals, lots
:07:09. > :07:12.of investment, how how has gone? Analysts are saying that in the
:07:13. > :07:22.whole, looking at it, the trip has gone reasonably well. It is a three
:07:23. > :07:25.nation 's tour. But already the Prime Minister has extended a
:07:26. > :07:27.five-year loan of $600 million to Mozambique, to help boost
:07:28. > :07:30.development in its coal industry and in total he's expected to pledge
:07:31. > :07:36.more than $14 billion in aid and trade deals during his trip to the
:07:37. > :07:39.region. Why is Japan doing this? The country is keen to push back against
:07:40. > :07:41.a growing Chinese presence on the continent as China currently stands
:07:42. > :07:49.as Africa's largest trading partner - that partnership was worth $200
:07:50. > :07:54.billion in 2012. Something Japan is hoping to tap into it. And as we've
:07:55. > :07:58.been hearing, Mr Abe is the first Japan Prime Minister to visit Africa
:07:59. > :08:00.in eight years and he's looking for investment opportunities for
:08:01. > :08:09.Japanese companies so they can secure much needed natural
:08:10. > :08:12.resources. The proof of course is in the pudding - so we will see in the
:08:13. > :08:14.coming months and years how economically beneficial Japan's
:08:15. > :08:35.injection of cash in this region will be. You will be seeing him
:08:36. > :08:44.presenting from the studio, on Thursday. Ricoh he is in. He is with
:08:45. > :08:49.us at the moment. These are the markets in Asia. It has been quite a
:08:50. > :08:55.dire session today. Japan down over 3%. They have had some pretty bad
:08:56. > :09:00.news, current account deficit for the month of November. Underlying
:09:01. > :09:05.the fact of the challenges facing Shinzo Abe as he returned from the
:09:06. > :09:10.tour of Africa. He has has economic reform programme, it is a three
:09:11. > :09:15.pronged programme, the third prong is going to be an act of this year.
:09:16. > :09:18.This -- that is not necessarily why the markets are down today. Losses
:09:19. > :09:23.across the board, following suit from Wall Street. Wall Street set
:09:24. > :09:28.the tone last night will stop losses across the board. The yen relatively
:09:29. > :09:34.strong versus the dollar which is hitting Japan today. Among the
:09:35. > :09:41.stories to watch today, US retail sales start out today. European
:09:42. > :09:46.industrial output today. In the French President's speech on the
:09:47. > :10:03.economy. We will talk about that in the paper review in a moment. Thank
:10:04. > :10:05.you to Sally. The amount of money being spent on temporary doctors in
:10:06. > :10:09.Accident and Emergency departments has soared by 60% since 2009 - the
:10:10. > :10:10.bill runs to tens of millions of pounds.