European security markets opened higher on Friday led by financials and miners amid positive US employment and manufacturing data. Stoxx Europe 600 index added 0.3%, reaching 235.49, German DAX 30 index climbed 0.2% at 5,735.25 while UK FTSE 100 index advanced 0.3 trading at 5,417.36. French CAC 40 index traded flat at 2,996.3.
BP, large oil producer, announced a settlement over the oil spill in Gulf of Mexico. The suit was carried between BP and Cameron International, designer of the system, failure of which led to spill. The agreement stipulates settlement of mutual claims and obliges Cameron to pay $250m to BP. The funds will be included into $20bn program of BP aimed at supporting victims of disaster
The global downturn is spreading and no one is invulnerable to risks, said Christine Lagarde, the head of the IMF. All nations have to commence combating crisis, starting with Europe in order to resolve financial difficulties, she added. Largest economies already are on the threshold of recession; France may fall into downturn in the Q1 of 2012, reported INSEE, French official statistics agency.
China is pushing a free trade agreement with South Korea and Japan and is ready to start talks in 2012, reported officials. Three countries are of critical importance in East Asia and closer economic ties will benefit all of them by increasing trade and facilitating flow of investments, said Shen Danyang, from China's Ministry of Commerce.
Indonesian investment status was upgraded to the same level as Indian one by Fitch Ratings. Fitch agency said the decision was made based on the relatively resilient growth, low sovereign debt and tight policies. The country's government debt looks more attractive than that of some European economies, said Jerome Booth from Ashmore Investment Management. The increase is expected to stimulate flow of investments in
White metal fluctuated dramatically this year, approaching $49 an ounce in April and falling below $30 in November. The growing worries over the global economy continue to weight down on silver; however, analysts believe in case silver price remains above its support level of $28 an ounce, it has a potential to jump essentially next year, said James Carrillo from Swiss America Trading Corporation.
China's manufacturing is expected to remain below 50 indicating contraction, according to preliminary HSBC Purchasing Managers' Index. The index is expected to approach 49, being 1.3 points higher as final November's PMI of 47.7. Low PMI forces the government to change its growth-focused policies faster.
Citigroup Inc. was forced to cease its financial product retail sales in Japan for 30 days for not providing adequate disclosure about risks in one of the retail units. The suspension will come in force since January 10, according to FSA. Citigroup Inc. also needs to submit plan of business enhancement till January 31.
China plans to increase its efforts put in developing cotton-planting in four countries in Africa, reported the Ministry of Commerce. Analysts believe closer cooperation with Benin, Mali, Chad and Burkina Faso will help China to increase fairness of the cotton-trade conditions under the WTO requirements. China with supply African countries with seeds, fertilizers and machinery as well as enhance personnel training there.
EU leaders may abandon UK derivative legislation after PM Cameron's attempt to protect country's financial sector almost ruined EU summit, said 4 officials familiar with matter. Analysts suggest that possible crumbling of UK's derivatives could be a notice from EU officials that British veto alone cannot strengthen its financial system.
Fitch Ratings agency reduced credit ratings for 3 major US banks: Goldman Sachs Group Inc, Citigroup Inc. (C) and Bank of America Corp. Lenders' long term credit ratings were cut from A+ to A, reported Fitch yesterday. Fitch Ratings also downgraded several European banks including BNP Paribas SA, Barclays Plc, Credit Suisse Group AG and Deutsche bank AG.
Morgan Stanley, sixth-largest US financial institution, whose stocks experienced 45% drop this year is going to cut around 1,600 jobs worldwide as revenue in investment banking decreases sharply. Job cuts are planned to take place during the 1st quarter of 2012, said Mark Lake, a representative of company. The estimate equals around 2.6% job reduction of 62,648 workers.
The Reserve Bank of India decided to leave its key borrowing rate unchanged, the first time in 8 meetings as both inflation and growth slows down. The central bank of India left benchmark interest rate untouched at 8.5% meeting predictions made earlier by economists. India rupee appreciated 2.7% against US dollar on the RBI announcement.
After 18 years of talks over the membership, Russia finally will become a member of the WTO at the ceremony in Switzerland due on Friday. The Swiss backed up Russia to solve the conflict with Georgia that has blocked Russian membership in the WTO since short war period in 2008. Russia is the largest economy to become a member of the WTO.
Crude oil futures fell for the second consecutive day after the report on the declined industrial production in the US. On the New York Mercantile Exchange, light sweet crude futures for delivery in January traded at USD93.47 a barrel at late U.S. trading hours on Thursday, losing 1.61% during the session.
Blackberry announced delay in the launch of new Blackberry 10, reported Research in Motion. The company is concerned on the fall in sales volume from 14.8 million in pre-Christmas time last year to 11 million expected in the same period this year. Blackberry also saw a decline in profit to $265m from $911m a year before. The share price of the company tumbled by
China will try to increase the level of domestic demand and will work out policies aimed at boosting consumption growth, reported Xinhua News Agency. Global economy will experience difficulties next year and the country has to fine-tune its macroeconomic policies to make them more focused, flexible and visionary, said Li Keqiang, Vice Premier. China will increase its governmental spending into infrastructure projects, he added.
Fitch downgraded six global banks on the growing tensions in the financial markets. The downgraded banks are the Bank of America, Goldman Sachs, Barclays, BNP Paribas, Deutsche Bank and Credit Suisse. The so called �default ratings of the issuer', which imply the ability of the entity to comply with its financial obligations timely, were cut. The banks hold large amount of euro-zone's debt and the concerns
Gold futures increased slightly after sharp losses earlier this week caused by the surge in selling of precious metal by investors and turning to the USD as safer investment option. Gold for delivery in February added $10.90 an ounce to $1,588.00 in electronic trade, edging up 0.7% since opening, reported FactSet.
The Reserve Bank of India announced it would maintain the key interest rates at the same level and would devote its strategies towards sustainable growth. The lending rate stayed at 8.50% while borrowing rate at 7.50%. The bank cited worsening economic outlook and outlined that it now put all its efforts in boosting economy rather than combating exorbitant inflation.
Italian PM Mario Monti today will face a confidence vote to hurry a budget proposal of 30 bn euro ($39 bn) emergency plan to stimulate growth and regain investor confidence that Italy can reduce its debt. Monti's government is urging lawmakers to vote in favour otherwise the government may fall. Monti's proposed measures include reforms in pension and tax system.
17-nation currency shifted for the sharpest weekly fall versus the US dollar in 3months as European countries prepare for bond auctions on forthcoming week amid worries EU leaders can't tame the region's crisis. This week euro managed to breach a psychological level of $1.30. Currently EUR/USD is trading at $1.3027.
The New Zealand and Australian dollars appreciated for the second consecutive day after Asian shares surged, boosting demand for riskier assets. Australian dollar added 0.6% to $0.9985 in Sydney, while its New Zealand's peer climbed 1% reaching $0.7609. Both currencies appreciated against Japanese yen. AUD/USD currently is trading at $0.9980 and NZD/USD is trading at $0.7593.
The US dollar retreated on Thursday and lessened some of its latest gains against the euro, indicating investor positive reception of US employment and manufacturing data amid reserved recovery in Asian markets and Wall Street. US dollar index dropped from 80.292 in North America trade to 80.16 in Asian trading session. Among its main counterparts, euro appreciated from $1.3022 to $1.3036.