Although most Asian market indexes recovered on Thursday, Nikkei 225 closed lower at 8,165.18 giving up 149.56 points or 1.8%. Analysts explain Nikkei's loss as investors attempt to catch up to yesterday's developments in Europe. German poor auction amid poor manufacturing report from China had a negative impact on the index. Nikkei 225 was mainly hit by blue chip companies. Fujitsu Ltd. lost 2.6%,
On Thursday trade Hang Seng index experienced first increase this week as People's Bank of China agreed to ease reserve obligations for more lenders encouraging investors to believe in additional relaxation. Hang Seng closed at 0.4% or 70.67 points higher climbing to 17,935.10. Main positive contribution to the index was provided by property developers. China Overseas Land and Investment Ltd. jumped 5.6%, China Resources Land
Fitch Ratings decreased Portugal's government credit rating to BB- from BBB- putting Portugal in junk status. The agency took into account bleak economic outlook, high debt level and mass protests against austerity measures that can decrease the level of debt. However, experts admit the government commitment to the austerity plan is strong. The Portugal 20 index increased by 0.2%.
Raiffeisen Bank International AG third biggest lender in Eastern Europe, reduced its medium term profit outlook after it experienced sharp losses in Hungary. Vienna-based financial intermediary predicted the ROE before taxes to reach 15% in contrast to previous forecast between 15% and 20%. Raiffeisen�s net income dropped by 58% within a June-September period.
Wheat futures slipped to the lowest level since June being pushed by high competition for US exports and bleak economic perspectives of the euro-zone. On the Chicago Mercantile Exchange, wheat futures for December delivery were traded at USD 5.7950 a bushel during early European trade, declining 2.31%. Wheat prices were also impacted by unrest in Egypt as the country agreed to buy 240,000 tons at
Failure of the Germany's auction has led to increasing worries about the euro-zone debt crisis. The current German 10-year bonds cost 2.23% exceeding the French ones priced at 2.21%. Experts claim the UK has stronger appeal to investors as it is considered to be a safer investment option.
JPMorgan Chase & Co has confirmed it will buy shares of bankrupted MF Global at London Metal Exchange. JPMorgan is expected to pay for MF's stake about 25 million pounds ($38.8 m). Last month MF Global declared bankruptcy after making bets that failed on European debt. JPMorgan agreed to buy all of MF Global shares, said Richard Heis, special administrator of MF Global.
Zambia's nickel mine, Munali Nickel Mine, announced it will resume its operations in January after implementing restructuring program. The company ceased its operations because of the cash flow difficulties in the beginning of November. The company plans to attract investors to finance the company and make its capital structure more stable, said the official.
Standard & Poor's has decreased the credit rating of Egypt from BB- to B+ pushing Egypt's debt close to junk status. The agency explains this downgrade as a result of political and economic situation in the country that continues to deteriorate. There were four days of demonstrations in Egypt before parliamentary elections due 28 November.
Copper futures surged after the German report indicated an unexpected increase in German business confidence. On the Comex division of the New York Mercantile Exchange, copper futures for December delivery were traded at USD 3.298 a pound at the early European trading, gaining 1.05%. Copper earlier decreased by 1.95% and was traded at USD 3.205 a pound, being a four-week low.
United Continental Holdings Inc. is planning to renew its flotilla of single-aisle airplanes and is currently participating in talks with Airbus SAS and Boeing Co regarding an order of about 200 jets. United Continental Holdings, world's biggest airline is considering Airbus A320 and Boeings 737 as well as new models with more effective engines. United Continental Holdings Inc. was created in 2010 after a merger
Britain's benchmark stock index increased by 0.6% on the increased business confidence in Germany. The strongest gainers are British banks and miners; the Royal Bank of Scotland Group PLC increased by 3.9%, Lloyds Banking Group PLC gained 3.6% and Barclays PLC rose by 3.5%. The top gainers among miners are Vendanta Resources PLC and Xstrata PLC that gained 3.9% and 3.7% respectively.
Today Portugal faces general strike, first since November 2010, as unions engage into demonstrations against austerity measures approved by Portuguese parliament to ensure the international bailout. Unions have disrupted shipping, services and travel. Serious distractions are expected in airports and rail stations. Strike takes place exactly one year after demonstrations against the first austerity implementation.
Consumer confidence in Italy significantly increased in November indicating the end of political turmoil by arrival of new government, according to the official data. The consumer confidence index increased to 96.5 in November from 93.3 in October. The increase exceeded the forecast of 0.9 point decrease. Monthly survey also showed more optimism in the market, Istat stated.
Standard & Poor's increased Iceland's credit rating outlook from negative to stable as country's economy returns to progress after recovering from financial crisis in 2008. According to Standard & Poor's yesterday's statement, Iceland has received �BBB-/A-3' credit rating. Iceland has put much effort to stimulate recovery, admitted S&P in its statement.
German Chancellor Angela Merkel refused the idea of issuing Eurobonds offered by European Commission. Merkel emphasized that the creation of Eurobonds will not pull the region out of debt crisis. German Chancellor also criticized European Commission's inappropriate switching to Eurobonds proposal, as it gives other countries misleading signal that more borrowing could resolve the crisis.
Crude oil futures have started to rise after a two–day decline. On the New York Mercantile Exchange crude futures for January delivery were traded at USD 96.75 a barrel at early European trade, being 0.6% higher. Experts claim that lower Dollar and strong oil demand in the US stimulate growth of the oil prices.
Germany's business confidence index increased in November despite unanimous pessimistic forecasts. Ifo institute in Munich reported that index has actually increased from 106.4 to 106.6. Experts surveyed by Bloomberg predicted a drop to 105.2. Carsten Brzeski, ING Group's economist in Brussels, pointed out that Germany's position in reality is rather strong.
Small and medium-sized Airbus suppliers have difficulties to get financing as the banks are concerned about deteriorating situation in the euro-zone. Banks avoid even viable financing in the aircraft, said Thomas Enders, Airbus Chief Executive. The company expects essential increase in production in 2012 taken the strong demand, he added.
European equities rose during Thursday's morning trade on speculation Germany may settle to release Euro-bonds. Stoxx 600 gained 0.4% to 221.1. Nevertheless, index has lost 20% throughout year. Standard & Poor's 500 Index futures expiring December climbed 0.5% indicating that US stocks might interrupt the six day decline. Dow Jones Industrial average futures advanced 0.4%.
The US Dollar was slightly lower against the Euro after news about increased business confidence in Germany. Higher level of confidence backed up the demand for riskier assets; however, debt crisis in the euro-zone still makes the outlook pessimistic. US Dollar is 0.27% lower and EUR/USD is 1.3382.
Shares of Banco de Valencia, seventh-largest Spain's bank, decreased on Thursday when they restarted trade after its bailout bySpanish central bank. Spain provided EUR1 billion to the Banco de Valencia. During the first 45 minutes shares fell by 22% causing decrease in equity to EUR286 million.
The growth in yuan deposits in Hong Kong slowed down but the overseas market for yuan will continue to rise, said Norman Chan, chief executive of the Hong Kong Monetary Authority. The inflow-outflow yuan ratio decreased to 0.8-to-1 in September. The decline in yuan deposits does not imply yuan lost appeal in foreign market, the decline is likely to be a short-term, said Chen Daofu,
European stocks increased after the Germany's Ifo business confidence index increased. The Stoxx Europe 600 index gained 1% to 222.36. The German DAX 30 index increased by 1.5% while French CAC 40 index rose 1.6%. The FTSE index increased by 0.6% to 5,171.88.