Marks & Spencer Share News (MKS)

George Osborne warns today that Britain faces "enormous risks" from chaos in the Eurozone, admitting that the government is preparing for the crisis to deepen. In a bleak assessment the chancellor voices fears that the turmoil in the European Union may "only get worse", hampering Britain's recovery from the double dip recession. As hopes of a swift solution to Greece's financial woes faded, with G8 leaders this weekend failing to achieve any breakthrough, Osborne issued an urgent plea to the leaders of France and Germany to find an answer. "We need the Eurozone to solve its problems ...The alternative scenario carries enormous risks for everybody," he said. Europe's debt crisis dominated the meeting of leaders of the main world economies at Camp David, near Washington, with François Hollande, the new French president, floating a radical approach. In a sign of increasing desperation for a solution, Hollande outlined suggestions including direct lending to Greece by the European Central Bank (ECB), The Sunday Times says.The growing Eurozone crisis threatens to shatter Britain's stock market and crush hopes for an economic recovery. With fears mounting that Greece was set to leave the euro and that the crisis was spreading to Spain, shares had already slumped in value. But risk analysts warned yesterday that a Greek exit from the single currency would wipe another 10% off the value of British banks. At the same time, recovery among manufacturers could be strangled by the crisis. With funds pouring into London, sterling is being pushed up to levels that could make exports more expensive, hitting trade and threatening jobs. Sir Mervyn King, Governor of the Bank of England, last week refused to rule out intervention in foreign exchange markets to try to cap the value of the pound, which has risen by four per cent since February, says The Financial Mail on Sunday.Mr Manduca, the former chief executive of Rothschild Asset Management, has been chosen by Prudential's board after a lengthy search of internal and external candidates. It is understood that in recent days the board has passed his name to the Financial Services Authority, which is in the process of vetting his credentials and past experience. As the potential chairman of the high-profile and complex insurer, not to mention the head of one of the UK's largest fund managers in Prudential's M&G division, the regulator must be certain that Mr Manduca has the appropriate skills to lead the board before sanctioning the appointment. It is expected an announcement on Mr Manduca's appointment, subject to regulatory clearance, could be made as early as this week, The Telegraph reports.Santander UK tried to reassure its British savers yesterday after a rise in customers withdrawing money in the wake of the downgrading of the Spanish-owned bank's credit rating. In spite of reassurance from financial experts and officials that their money was safe, some depositors were taking no chances. The British bank, which has 25 million customers, stressed its financial strength and its independence from the crisis buffeting the Spanish banking industry. Conscious of the panic that engulfed Northern Rock in September 2007, Santander rushed out leaflets to reassure customers of its autonomy from its Spanish parent. The Treasury also issued a soothing statement after reports on the internet referred ? inaccurately ? to panic-stricken savers, The Sunday Times reports.Millions of tonnes of wheat are set to rot out in the open this summer because India lacks adequate facilities to store its biggest grain harvest on record. Indu Sharma, director of the country's Wheat Research Institute, said that the total harvested by the world's second-largest producer this year would be "more than 90 million tonnes", well above the nation's total storage capacity of 63 million tonnes. Official figures show that the harvest, which is not yet complete, had already exceeded 71 million metric tonnes by May 1. Yesterday, it emerged that Delhi was planning to tackle the crisis by exporting wheat to Iran as part of a giant international barter. It intends to clear some of its overflowing stockpiles and make way for freshly harvested grain, while also settling part of its oil imports bill, according to The Sunday Times. A new measure of inflation that incorporates housing costs will attempt to offer a more comprehensive gauge of household costs. The new version of the consumer prices index will run alongside the existing measure from March 2013. The move comes after years of lobbying by users of statistics, who have complained about the absence of owner-occupied housing costs in the CPI. Gordon Brown, the former Chancellor, ordered the Bank of England to target the CPI rate in 2003, dropping the previous measure, a version of the RPI that excluded mortgage interest payments. The move was criticised subsequently because it meant that the Bank was following a measure of inflation that did not account for house prices, says The Sunday Times.Newly-elected French president Francois Hollande will use Wednesday's informal meeting of European Union leaders to outline proposals for euro-bonds in an effort to reassure financial markets on the outlook for the Eurozone. Hollande is expected to put pressure on German chancellor Angela Merkel to remove her opposition to introducing Eurozone bonds, which would be issued for the whole of the single currency area, in effecting using the financial strength of Germany to support weaker economies. Speaking after the weekend G8 world leaders' meeting at Camp David in the United States, Hollande said: "I will outline all growth proposals at this informal meeting. "Within this packet of proposals there will be euro-bonds and I will not be alone in proposing them. I had confirmation on this at the G8," writes Scotland on Sunday. The wettest spring on record and financial turmoil in the Eurozone are set to cast a cloud over annual results at high street retail icon Marks & Spencer this week. However, chief executive Marc Bolland is expected to reveal that despite the economic woes of M&S's Greek and Irish markets, in particular, the retailer has kept overseas sales above the £1bn barrier it breached in the previous year. Bolland admitted in a fourth-quarter sales update last month that the retailer had been caught on the hop by clothing stock shortages in its UK stores in a very cold February. That triggered a 2% fall in clothing sales, although like-for-like food sales lifted 1%. Analysts say clothes revenues are believed to have worsened since the 31 March financial year end of the group, with the wettest April ever sure to have hit spring and summer fashion ranges. That inclement weather has continued into May, Scotland on Sunday reports.AB