Market report: Vodafone enjoys late surge on Japan bid speculation

Telecoms giant Vodafone staged a late surge on Tuesday as traders digested reports out of Japan that the business could be a takeover target.

Shares in the company rose as much as 1.6pc in afternoon dealings, boosted by a story in the Nikkei Asian Review which speculated that Japanese mobile business Softbank could have the British business in its sights.

The report hinged on Softbank boss Masayoshi Son being questioned during an earnings briefing about his company’s decision to abandon its pursuit of T-Mobile US. Asked about alternative targets, he was reported to have said he constantly thinks about options, and one anonymous Softbank executive was quoted as saying he “wouldn’t be surprised if the company acquired Vodafone since we are no strangers to each other”. Mr Son got to know Vodafone when he bought the company’s Japanese business in 2006.

The story was enough to see shares in FTSE 100-listed Vodafone end the day up 2.2p at 208.9p, having eased back in final dealings. Industry sources said no approach had been made. Vodafone declined to comment.

Card fraud in Asia-Pacific 'costs banks $400m a year'

Card fraud in Asia costs banks $400m (£241m) a year and is rising by 20%-25% a year, according to the software analytics firm Fico.

It's a growing challenge for the industry as consumers in the region increasingly conduct transactions or shop online.

The BBC's Ashleigh Nghiem spoke to Fico's managing-director in Asia, Dattu Kompella, to discuss the associated security risks.

World Economic Forum: UK moves up global economic list

The UK has edged up the global rankings in a major annual economic survey by the World Economic Forum (WEF).

Its Global Competitiveness Report sees the UK rise one spot to ninth on the list, while Switzerland and Singapore retain first and second place.

The US improved its competitiveness position for the second consecutive year, climbing two places to third.

But the WEF warns that the global economy's health is at risk, despite years of monetary stimulus and reforms.

Each year, the WEF, best known for its annual Davos economic meeting, benchmarks countries against 12 factors, including infrastructure, education and training, labour market efficiency, technological readiness and innovation.

The aim is to produce a comparative picture of what is driving competitiveness, productivity, and prosperity in 144 countries.

The UK wins plaudits for adopting technology to enhance productivity, and for its general business environment.

Finland (4th) and Germany (5th) both drop one place.

Among emerging market economies, Saudi Arabia (24th), Turkey (45th), South Africa (56th), Brazil (57th), and India (71st) all fell in the rankings. But China (28th) rose one position.

The report said that that top-ranked countries had common factors driving competitiveness.

"The leading economies in the index all possess a track record in developing, accessing and utilising available talent, as well as in making investments that boost innovation.

"These smart and targeted investments have been possible thanks to a co-ordinated approach based on strong collaboration between the public and private sectors," the report said.

Risks

In Europe, the report warns of a widening split between countries in the South and North.

"While the divide between a highly competitive North and a lagging South and East persists, a new outlook on the European competitiveness divide, between countries implementing reforms and those that are not, can now also be observed," the WEF said.

The report also sounds a warning that the health of the global economy is at risk, despite years of what the WEF calls "bold monetary policy".

It saw "uneven implementation of structural reforms across different regions and levels of development as the biggest challenge to sustaining global growth".

Klaus Schwab, founder and executive chairman of the WEF, added: "The strained global geopolitical situation, the rise of income inequality, and the potential tightening of the financial conditions could put the still tentative recovery at risk and call for structural reforms to ensure more sustainable and inclusive growth."

Japan wage growth surges in July

Japanese wages unexpectedly logged their strongest increase since 1997, providing a boost to the government's battle against deflation.

Labour cash earnings rose by 2.6% in July compared to a year ago, beating forecasts of a slowdown to 0.9%.

Special payments, or summer bonuses, grew by an annual 7.1% in July from a revised 2% gain in June.

However, some economists warn that wage growth is set to slow in coming months.

"The summer bonus season ends in August, and bonus payments are set to fall sharply. As a result, the growth rate of overall earnings will mostly be driven by changes in regular pay," Marcel Theliant from Capital Economics said.

"With base pay expanding clearly less rapidly than bonuses, wage growth will likely slow again in coming months, but it should stay in positive territory."

The data suggest that some firms are raising wages, which is crucial to improving Japan's overall economic performance.

Japan has struggled to break out of nearly two decades of falling prices, or deflation, which has resulted in stagnant economic growth.

To combat this, the government undertook a massive stimulus plan aimed at weakening the currency and spurring spending. It hopes to achieve a 2% rate of inflation next year.

However, an April sales tax hike - needed to raise funds to address the fiscal deficit - caused a drag on Japan's economy because it became more expensive for people to spend.

Asia's second-largest economy shrank by an annualised 6.8% in the second quarter after household spending plummeted.

Japanese Prime Minister Shinzo Abe is also considering the implementation of a second tax hike in October next year.

Swiss economy fails to grow as EU stagnates

Switzerland's economy failed to grow in the second quarter of the year, according to the country's State Secretariat for Economics.

The much weaker-than-expected figure came after exports were affected by weakness in the rest of Europe and construction spending fell.

The zero growth in the quarter was the weakest performance for two years.

Compared with a year earlier gross domestic product (GDP) was 0.6% higher, well below forecasts of 1.7%.

"For us it's really below expectations. We expected a bit more growth," said Maxime Botteron from Credit Suisse.

"The trend in exports is not a big surprise. Trade data so far already pointed to a rather weak contribution of exports. What is a bit more surprising is the weak investment spending, especially in the construction sector."

At the weekend, the chairman of the Swiss National Bank, Thomas Jordan, said that macroeconomic and geopolitical risks may lead to the bank cutting growth forecasts.

Figures released last month showed that the eurozone - a key export market for Switzerland - recorded zero growth in the second quarter of the year.

The lack of growth has raised the pressure on the European Central Bank - which holds its latest meeting on Thursday - to take measures to stimulate the eurozone.

Brazil's economy falls into recession, latest figures show

Brazil has fallen into recession, just a month before the general election, latest figures show.

Economic output, GDP, fell by 0.6% in the three months to June, worse than analysts had predicted, and revised figures for the first quarter of the year also showed a fall of 0.2%.

A recession is usually defined as two consecutive quarters of contraction.

The news will be damaging for the government of President Dilma Rousseff.

According to the most recent poll, Ms Rousseff would lose to a rival candidate, environmentalist Marina Silva, if October's election went to a second round.

The World Cup, held in June and July, was not regarded as generally good for business, says the BBC's Wyre Davies in Rio de Janeiro.

"There were more days off for employees and many traditional tourists stayed away," he says.

"The problem is that, with elections due in early October, the economy is increasingly seen as President Dilma Rousseff's weak point."

The World Cup failed to lift Brazil's economic output

The data showed that civil construction, manufacturing and investment especially suffered during the second quarter.

'Cloud' concerns after celebrity picture leaks

Experts have raised concerns over the security of "cloud" storage sites following the leak of intimate pictures of celebrities.

It is understood some of the images were obtained from services such as Apple iCloud that back up content from devices on to the internet.

Apple is understood to be looking into the issue.

One expert said that private data "becomes much more difficult to control" when using cloud services.

"It is important for celebrities and the general public to remember that images and data no longer just reside on the device that captured it," said Ken Westin, security analyst at Tripwire.

"Although many cloud providers may encrypt the data communications between the device and the cloud, it does not mean that the image and data is encrypted when the data is at rest.

"If you can view the image in the cloud service, so can a hacker."

Apple has not commented on speculation regarding iCloud's security, nor the celebrity leak.