As debt turmoil in Eurozone is being endured, discussions about alternative solutions start to spread. The latest of them offers to use gold for collateral. Jeffrey Nichols, American Precious Metals Advisors' manager reminded that countries in the past already have used gilt as collateral. Eurozone's banks currently hold about 64% of world's gold assets.
Consumer spending increased by 0.1% while disposable income rose by 0.4% indicating the decrease in proportion put aside as savings, reported the Commerce Department. The forecast made by Marketwatch was an increase in spending by 0.3% while income was estimated to grow by 0.2%. The savings rate decreased by 4.1% in Q3 as compared to an advancement of 5.1% in Q2.
Indian stocks reached their lowest value in two years amid investors' worries about struggling global economy and falling Rupee that could harm earnings. Indian benchmark Sensitive Index lost 2.3% in Mumbai trade today, while Rupee fell to record low the day before. Indian most valuable enterprise, Reliance Industries Ltd, experienced a decline of 2.3% on Wednesday.
European Commission announced its plan to implement jointly-guaranteed euro bonds aimed at struggling with debt crisis. Proposal is strongly opposed by Germany. The joint issuance of bond will allow deeper integration and will bring promising results in future, said Jose Manuel Barroso, European Commission President. However, the strategy is not able to solve the problem and has to be accompanied with stricter economic governance, he
The number of jobless claims in the US is higher than reported earlier, announced the Labor Department. The claims increased by 2,000 to a seasonally adjusted 393,000 while last week it was reported that the number of claims fell to 388,000. Experts predict that the number of unemployment-insurance benefits will continue to fluctuate near 400,000 until there will be an essential increase in hiring.
According to Commerce Department, Americans have increased their savings in October while the consumption has slightly declined. The rate of personal savings increased by 3.5% compared to 3.3% in September. Incomes advanced at faster pace than spending. Personal income surged by 0.4% in October while Americans improved their consumption only by 0.1%.
On Wednesday Fitch announced that France's AAA credit rating is exposed to downgrading if euro debt crisis will result in sharper downturn in the country. Rating agency predicted France will need extra budget consolidation measures to reach target 3% GDP deficit in 2013. However, Fitch also admitted that French triple-A rating is supported by diversified economy and stable tax system.
Orders for durable goods in US decreased by 0.7% in October; the sector was mainly affected by a fall in commercial transportation. However, the decrease is lower than expected as the forecast was 1.5% decline. Bookings for transportation devices, extremely volatile sector, were down by 4.8% while orders for aircraft fell by 16.4%.
The sale of German 10-year notes worth €6 bn attracted bids worth only €3.889 bn. Bundesbank was forced to pick up remaining €2.356 bn. According to Nick Stamenkovic, RIA Capital's fixed-income economist, the poor auction indicates that investors are turning away from Eurozone. Germany's 10-year yields increased by 12 bp reaching 2% in the secondary market.
On Tuesday S&P declined for the fifth session in a row dropping 0.4% or 4.94 points and closing at 1,188.04. Utility and energy companies led the decline while consumer staples and health care were the best players among 10 industries. Hewlett-Packard Co a blue-chip company lost 0.8% after Meg Whitman, chief executive recommended investors to reduce expectations about fiscal performance in 2012.
The British Pound reached six-week record low against Greenback after Bank of England in its meeting minutes reported greater stimulus might be needed. Monetary Policy Committee also decided to stick to key borrowing rate at 0.5% and leave the amount of quantitative easing worth $428 bn unchanged. The pound lost 0.4% reaching $1.5569 in London trade. Hydeskov, chief analyst at Danske Bank in London expects Pound
Australian Dollar depreciated against US peer reaching lowest level in a month while New Zealand Dollar hit the lowest value since March amid Europe's rising yields reduced investors' confidence. Aussie lost 0.7% against US dollar and was trading at $0.9767 in Sydney evening trade. Kiwi dropped 0.4% reaching $0.7442 - record low since March. The pair NZD/USD currently is trading at $0.7420 while AUD/USD is
The Bank of England's Monetary Policy Committee supported the decision about sustaining the interest rate at 0.5% and leaving the amount of asset-purchase strategy at 275 billion pounds. Last month the bank expanded the size of the strategy by 75 billion pounds as part of its quantitative-easing program. However, worsening situation in the euro-zone increases the level of risk and the bank decided to stick
Crude oil futures continue to decline reaching a two-day low after the news on contraction of the manufacturing output Europe caused by concerns about debt crisis spread. On the New York Mercantile Exchange oil futures for January delivery lost 1.12% to USD96.91 a barrel. Crude oil prices also declined at the Asian trading as the manufacturing output of China decreased as well.
The European Commission is going to discuss new rules requiring the members of the euro-zone to hand it their planned tax and spending strategies to the EU before they are passed by national parliaments. It will allow the EU to detect the countries that experience financial problems. The decision will be presented alongside with the report on three options on euro bonds issuance, according to
Libya's Bouri oil field a part of which is owned by Italy's ENI SpA has resumed its operations, announced the head of the company. The company restarted output at 10,000 barrels a day and is projected to achieve a full capacity of 40,000 barrels till the end of the year. Restart of the activity facilitates the country's development after war period.
Cost of borrowing across the euro-zone has increased as the bailout plan for Belgian bank Dexia SA proved to be infeasible, Belgian newspaper reported. France's 10-bond yield was impacted by the report as France has to provide rescue package for Belgium. France's cost of borrowing increased by 10 basis points to 3.62% while Belgium 10-years bonds yield increased by 17 basis points to 5.21%, FactSet Research
Britain's benchmark stock index decreased after the announcement about the decrease in China's manufacturing output; manufacturing purchasing managers index fell to 48 indicating contraction. In UK the FTSE 100 index decreased by 0.8% to 5,166.4 in early trading. Mining UK shares were impacted the most. Rio Tinto PLC declined by 2.3% and Fresnillo PLC dropped by 2%.
Copper futures experienced losses decreasing to the month-low after weak demand for German 10-year bonds caused by worries about crisis in the euro-zone. On the Comex division of the New York Mercantile Exchange copper futures lost 2.15% to USD3.261 a pound. Europe is the second largest consumer of industrial metals so the growing concerns over crisis impact the prices of copper.
Shares of travel company Thomas Cook experienced a dramatic decline yesterday after it started negotiations about increasing the amount of loans. Thomas Cook explained that the company was affected by demonstrations in Egypt and Thailand's floods, thus more loans are required. At the moment the company's share price is 12.65 pounds increasing by 24.02%.
On Wednesday Hong Kong's Hang Seng Index extended its decline and dropped by 2.1% closing at 17,864.43 or 387.16 points down compared to Tuesday. The sharp decline was mainly caused by China's disappointing manufacturing survey. PCCW Ltd was among major losers in index, giving up 3.3% after pricing its telecom trust at lowest level in price range. Resource and banking industry shares also added negatively to
European share markets traded lower on Wednesday; STOXX Europe 600 index lost 0.2% to 222.87 On Tuesday it also decreased by 0.7% because of cut in US growth forecast. Today's decline was caused mainly by report of drastic decrease in China's manufacturing output and IMF's announcement about setting up a credit line aimed at preventing debt crisis in Europe.
China plans to overtake the US becoming the world's largest online market by 2015, reports Boston Consulting Group. China's e-commerce market is expected to increase by 33% and overcome a 2 trillion Yuan threshold in transaction value by 2015 with the number of customers buying online growing to 329 million at the same period. Moreover, e-tailers will contribute 7.4% to the total retail value
Focus Media Holdings Ltd was accused by Muddy Waters of deliberately overpaying for takeovers in order to overvalue its assets. After allegations Nasdaq-listed shares of Focus Media Holdings dropped by 66 cents to $15.43 being 52-week low. However, Focus Media Holdings denies the accusations and plans to take legal action against Muddy Waters.