Sunday newspaper round-up: Paris reaction, banking fallout, HBOS, Rolls

Analysts and strategists have predicted European and Asian stock markets will fall sharply but not lead to a major crash on Monday amid fears that the terror attacks in Paris will hurt Europe’s economic recovery. European markets are expected to lose 2% when trading begins, with the French market likely to bear the brunt of the sell-off and the euro losing ground against the dollar and pound, according to reports from the Sunday Times and the Observer. A dive in the French economy could force the European Central Bank (ECB) to accelerate further stimulus measures.

Mass layoffs announced by banks including Standard Chartered, Deutsche Bank, Credit Suisse, Royal Bank of Scotland and Barclays are threatening other corners of the Square Mile that rely on them in different way, the Sunday Times said. Hedge funds are struggling to recruit top talent as banks due to cutbacks in bank's trader training, while the withdrawal of trading books by investment banks is leading to heightened volatility in normally stable safe markets such as US bonds and German bunds. “The banking sector drives the British economy,” said Kate Grussing, founder of the headhunter Sapphire, pointing out that accountants, law firms, management consultants and headhunters rely on the banks.

The Treasury is set to assuage the concerns of City of London banks about the difficulty of hiring foreign talent due to the immigration clampdown by home secretary Theresa May. Treasury officials have made it clear they will tackle a problem that saw several cases of bankers denied visas. The Sunday Times reported that a Treasury insider confirmed that officials had got in touch to “clarify” immigration policy on non-EU workers.

The long-awaited report into the collapse of HBOS in 2008 will land on Tuesday but so late that guilty parties are now out of reach of the authorities, as the six-year statute of limitations for civil actions has already expired. There is still expected to be some official blame levied on certain individuals' shoulders, with critics of Lloyds' takeover of HBOS deal also hoping it might provide clear evidence that Lloyds was sold a pup, said the Mail on Sunday. The Sunday Times added that the regulator may be able to ban the “HBOS Three”, chairman Lord Stevenson and CEOs James Crosby and Andy Hornby, from working in the City again.

Rolls Royce has been refining plans to axe hundreds of middle-management jobs in a bid to cut costs in the wake of its fifth profit warning in two years. New chief executive Warren East is also believed to have decided against outsourcing or selling its plants, according to sources cited the Sunday Times, which added that East is intending to spend millions on overhauling the business in an effort to minimise its exposure to weak demand and improve systems.

After a weather-hit start to the autumn fashion season, clothing retailers have for the second year running begun to roll out discounts earlier than usual and a fortnight before the Black Friday discount day. Despite recently stressing its efforts to avoid discounting, Marks & Spencer is offering 20% off coats and jackets and up to 60% off selected other items, the Observer reported, with Debenhams offering up to half price on women’s knitwear; while Dorothy Perkins, Burton, BHS and Oasis are all offering up to 30% discounts and French Connection advertising 25% off many knitwear items.

Discount supermarkets Lidl and Aldi are planning to open significantly more stores than Tesco, Sainsbury, Morrisons and Asda combined, research has revealed. The German LADs (limited assortment discounters) have submitted a total of 171 planning applications, five times as many as the so-called 'Big Four', which between them have submitted just 29 applications, data compiled by Barbour ABI for the Sunday Telegraph showed.

Another discounter is on an expansion drive, with The Range due to open stores in Newcastle, Altrincham near Manchester and Falkirk in coming months as it adds to its 100-strong estate and £565m sales in the last year. The Sunday Times reported that founder Chris Dawson, a former market trader and known as Devon’s Del Boy, calls The Range a “poor man’s John Lewis” and indicated he was not keen to sell despite private equity interest.

Gatwick Airport will go ahead with plans for a second runway, regardless of whether it receives government backing for the move. Ahead of the government's December decision on whether it plans to support Gatwick or Heathrow, the chief executive of the West Sussex airport told the Sunday Telegraph that he did not think the announcement "can possibly be the end of it. I think the government decision is an important milestone, but we are going to lose our appetite and build a second runway? Our belief is, Heathrow is undeliverable."

Major BT investors fear the impact of the possible split of Openreach from the rest of the telecoms giant. As Ofcom conducts its once-a-decade review of the communications sector, prompting heavy campaigning from the company's rivals for a referral to the competition regulator, one top 10 shareholder told the Sunday Telegraph: "My view is that separation is unlikely and as far as we're concerned that is a good thing."

Hotel chain Travelodge is subject of a bid battle between US private equity giants Starwood Capital and Apollo Global Management. A rival to Whitbread's Premier Inn, Travelodge has 500 sites and the scramble towards a final bid deadline at the end of November could see the valuation driven up to £1.5bn or more, according to insiders cited by the Sunday Times.

While half the reason for the recent slide in figures on global trade volumes has been caused by the commodity price rout, the other half of the reason is not weak global demand but due to creeping rise in protectionism. Analysis by the Swiss thinktank Global Trade Alert suggested the declines have overwhelmingly taken place in just 28 categories of product, a very concentrated level that disproved the theory of a global downturn, researcher Simon Evenett told the Observer, with subtle measures including restricting public procurement to domestic firms or quietly tightening regulations to raise the bar against imports.