NOT Four Weddings and a Funeral this week, but two nuptials at a stretch of history and there are plenty of potential funerals around. The first wedding has S G Warburg, British banking's answer to Hugh Grant, putting the engagement notice in the papers for a proposed wedding with Morgan Stanley, or Andie MacDowell for present purposes. But even before the invitations have been sent out, Warburg staff have started to notice that the American bride is a bit large, hairy and strapping for that little wedding dress. It seems that most Warburg staff had thought talks were going on with J P Morgan - also American but far more bank-like than Morgan Stanley. In fact, Morgan Stanley and Warburg are more like competitors than complementary partners. But as one observer said yesterday: 'What is the point of having a merger if you can't sack anybody.' In Hong Kong there are said to be a lot of worried workers at Warburg whose shareholders are to be the junior partner in the new venture. Once the first steps of combining back offices have been undertaken and the surplus workers shed from the payroll, the bosses will start to look at the front of the house. Rainmakers will get to keep their jobs but what are the chances of Morgan Stanley Warburg (after five years, Morgan Stanley again) running two derivatives desks in the territory? Or even two dealing rooms. The other set of bankers in town waiting for post-wedding dispositions to be sorted are those at PaineWebber's new purchase, Kidder Peabody. Kidder's Tokyo office was shut down this week but the 40 staff in Hong Kong are only just learning their fates. Sources close to the company said chances were the two local operations would be merged and at least some of the Kidder staff would keep their desks. If any of the workers at these firms does stumble across another vacancy in the next few days, they would be well-advised to snap it up and not bother waiting for bonuses this year. The news from the stock market just gets worse and worse. The spot index future plunged through the 8,000-point level on Thursday afternoon just before close of play and, despite a day of losses, the Hang Seng Index was chasing the December future downwards all yesterday. The index could not seem to regain the support of even 7,800. Is this the bottom of the market? Quite possibly not. Hong Kong is still on a price-earnings multiple of more than 11 times. Historic lows in the past five years have been at nine times. The market's funeral comes after a long struggle, with the debilitating illness of rising interest rates. All year, the US Federal Reserve Board has been raising rates and investors have switched their cash out of the markets as bond and stock prices fell. In Hong Kong, the effect of continued interest rate rises is now a concern for more than just share prices. Investors are starting to feel that firms are likely to see profits held back in coming years by high interest rates. There are two reasons. First, local firms have been borrowing more heavily than usual in the past two years. Low interest and high growth have tempted corporations into borrowing and now the costs are starting to come in. In the second place, high interest rates will almost certainly rein in the property market even further and strangle back profits at developers and traders. A glace at the graph shows that in historical terms, the market is still far from its potential bottom . . . and as an analyst remarked yesterday afternoon: 'The big problem is the 'E'.' Earnings in some sectors already seem to be struggling against the bonds of the economic cycle. Some Hong Kong corporates have run up against the old problem of instant product obsolescence. B+B Asia is perhaps the first of the big airport-related project contractors to feel a chill. The firm has hit problems on a contract, issued a profits warning and could only mourn as investors held a burial at sea by hurling the company scrip out the windows of Exchange Square. The fund management industry might also be feeling like holding a small memorial service. The glory days of 1992 and 1993 are past and fund holders are starting to see old dates flash back across the calendar at ever-increasing speeds. The only people who seem to have done well out of this year's market are the directors of companies. Howls of protest went up on learning that directors at Lai Sun had decided to raise emoluments to unprecedented levels. The non-executive director defended the chairman as the 'hardest working man in the galaxy' and the firm has since added that the high fees, up 153 per cent at one company, were a reward for good performance over the past years. The company pointed out there was no option scheme at Lai Sun. But then seeing as how the directors own so much of the stock, there was no need. For the rest of us, the only way we are going to get anything out of the local market this year is by shoving a finger down a broker's throat. Still, it could be worse. There are some people sitting with large piles of warrants which look set to expire out of the money on December 31. Stand up all fans of China Travel, Chuang's International, Denway Investment, Dynamic Holdings, General Electronics, Guangzhou Investment, Hanny Magnetics, Mansion House, MKI Corp, South Sea Development and Tse Sui Luen.