Business & Finance
Investors sought safe assets in the immediate aftermath of the terrorist attacks in London, sending the British pound into decline along with the value of stocks in such industries as insurance, transportation, and tourism. The London Stock Exchange remained open despite the shock gripping the city - its FTSE index down 2 percent as it neared the close of trading Thursday. The pound dropped from $1.7567 to $1.7446 against the US dollar. Gold, meanwhile, rose $4.25 an ounce in London trading, to $427.85. Buyers also were flocking to US Treasury bonds, reports said. In Paris, the key CAC 40 stock index slid 4.5 percent in the early hours after the attacks, but recovered slightly and was down by 2.3 percent as the close approached. Germany's DAX index fell 2.2 percent, with Finance Minister Hans Eichel appealing to investors to "react with prudence" to the incidents in London. In New York, Dow Jones Industrial Average futures recovered from an immediate 190-point drop on news of the attacks to 133 points in early trading. Nasdaq index futures, which were off 35.50 points before the market opened, had recovered 11 of those points as the Monitor went to press.
Unocal, the oil company at the center of an international bidding war, has said it would consider reneging on the $16.5 billion bid it accepted from rival Chevron, the Financial Times reported. But it said such a move would come with conditions: The Chinese oil producer bidding against Chevron, CNOOC, would have to pledge to meet the demands of US regulators, who must approve a takeover. CNOOC has bid $18.5 billion for Unocal, and its chief executive said that might be increased to try to overcome the hesitation of some Unocal board members. Fu Chengyu also told The Washington Post Wednesday he was dismayed that "so many people would be so sensitive to this." Some of Unocal's major shareholders, meanwhile, told the Post they disagree that a CNOOC takeover would pose a threat to US security and that Chevron will have to raise its offer if it hopes to complete the merger.
UnitedHealth Group, the nation's second-largest underwriter of medical insurance, said it will acquire PacifiCare Health Systems for $8.1 billion in cash and stock. The deal includes the assumption of another $1.1 billion of PacifiCare's debt. It opens the large California market to UnitedHealth, which is based in Minnetonka, Minn., and is not a significant player in western states. PacifiCare, of Cypress, Calif., is the No. 2 private administrator of Medicare plans in the US.