Is it possible to rotate a labels (not feature labels but manual annotations) in Print Composer in QGIS 1.8?
Labels that you add manually when in the Print Composer (as opposed to labels applied to a layer) can be rotated in QGIS 1.9 (after a fashion) on but not in QGIS 1.8.
In the latest release of QGIS 1.9, go to the print composer and add a label. Then in the item properties expand the 'Display' section and add a value for rotate. The background is expanded to accommodate the rotated label (hence my comment 'after a fashion' above!), so I think it looks best to turn the background off.
If you want to rotate labels on a layer then use the advanced (data driven) labeling capability.