Stock Market Update - Dec.20 - Dec, 24, 2010 Cautious Choppy Gains Seen with Mixed Economic Data
Stock Market Update
Friday, December 24, 2010
Latest US Economic News Headlines:
The U.S. Market Will Be Closed Friday for the Christmas holiday.
Christmas Eve; Markets, banks, businesses and government offices are closed.
The U.S. Market Will Be Closed Friday for the Christmas holiday.
Christmas Eve; Markets, banks, businesses and government offices are closed.
USA EQUITY INDEXES: (THURSDAY, DEC. 23; 4:05 PM EST)
(CLOSING INDEX NUMBERS)
DJIA 11,573.49 +14.00
NASDAQ 2,665.60 -5.88
S&P 500 1,256.77 -2.07
Dow Jones CLOSING Averages 12/23/2010: DJIA 11,573.49 UP 14.00
30 INDUS 11,573.49 UP 14.00 OR 0.12%
20 TRANSP 5,078.92 DN 19.90 OR 0.39%
15 UTILS 405.73 UP 0.33 OR 0.08%
65 STOCKS 4,026.91 DN 1.78 OR 0.04%
US COMMODITY PRICES: (FRIDAY, DEC. 24; 11:15 AM EST)
Crude Oil 91.41 - 0.11%Natural Gas 4.08 - 1.66%
Gasoline 2.44 +0.12%
Heating Oil 2.54 +0.12%
Gold 1385.12 + 0.37%
Silver 29.26 - 0.17%
Copper 4.25 - 0.40%%
US DOLLAR FUTURES INDEX DXY: DEC. 24: 8:30AM EST: 80.48 Down 0.23 (0.29%)
Merry Christmas and Happy Holidays from the staff of the Online Consultancy Network.
U.S. Dollar drops, Stocks Flat, Commodities Higher in Mixed Trading
The DJIA closes up 14 points (0.1%) to end at 11,573.49, the S&P closed lower 2.07 points (-0.17%) to finish at 1256.77, and the NASDAQ finished 5.88 (-0.22%) lower to complete the week at 2665.60. U.S. blue-chip stocks edged higher Thursday while other stock-market measures drifted lower, trading in a tight range as a mixed bag of economic data left investors with little reason to make major position changes ahead of the holiday. Stocks and bonds were little changed in quiet trading Thursday after a report showed that consumers didn't increase their spending last month as much as analysts anticipated. The euro was trading at $1.3102 recently, up slightly from $1.3099 late Wednesday. The U.S. Dollar Index, tracking the U.S. currency against a basket of six others, slipped 0.2%.
The Dow Jones Industrial Average recently edged up 4 points to 11563. Earlier Thursday, the measure reached a fresh two-year intraday high at 11580.84. Alcoa led its climb with a 1.3% rise, while Hewlett-Packard and Verizon Communications each increased 0.8%.
Bank of America kept the measure's advance in check, falling 2%, although that erases only part of its Wednesday jump. Walt Disney was also weak, off 0.7%, while Travelers slipped 0.7%.
The Nasdaq Composite fell 0.3% to 2663. The Standard & Poor's 500-stock index declined 0.2% to 1296, with financials leading to the downside in a small pullback from the sector's Wednesday rally while materials and telecommunications stocks rose.
The activity followed a mixed round of economic data with few surprises, prompting investors to see little need to change their positions heading into the holiday. At Noon the dollar dropped to allow the major Wall Street indexes to finish the week in positive territory.
THURSDAY BEFORE THE BELL US stock futures remained slightly lower in mixed trading on Thursday morning as the dollar edged higher. Treasurys declined, lifting the yield on the 10-year note up to 3.37%. Crude-oil futures slipped but remained above $90 a barrel, while gold futures also edged lower. Investors awaited a slew of economic data ahead of the final trading day. US stock futures fell slightly Thursday morning following a bigger-than-expected drop in durable-goods orders and a smaller-than-projected increase in consumer spending for November.
WEDNESDAY: New York indexes finished higher, with the Dow Jones Industrial Average ending up 26.33 points, or 0.23%, to 11559.49 and the Nasdaq composite index rising 3.87 points, or 0.15%, to 2671.48. The broader Standard & Poor's 500-stock index finished up 4.24 points, or 0.34%, at 1258.84.
U.S. stocks wavered after U.S. 3Q economic growth missed economists' estimates while existing-home sales for November rise less than expected. The U.S. Dollar Index, tracking the U.S. currency against a basket of six others, was flat. The euro slipped to $1.3087, reversing earlier gains from $1.3096 late Tuesday.
WEDNESDAY: BEFORE THE BELL U.S. stock futures are little changed, as investors await data on economic growth and existing home sales for more clues on the state of the economy.
The third estimate of U.S. third-quarter gross domestic product is due this morning. Crude Oil was trading above $90.18 a barrel, and the dollar is slightly lower than Tuesday's close.
TUESDAY: U.S. equities closed higher Tuesday, along with a higher dollar. US blue-chip stocks closed at there highest level in more than two years The DJIA edged up 55.03 points (+0.48%) to 11,533.16. The S&P moved up 7.52 points (+0.60%) to 1254.60, NASDAQ also finished up 18.05 points (+0.68%) to 2667.61. The euro was recently trading at $1.3093, down from $1.3126 late Monday in New York.
The blue-chip measure rose 50 points, or 0.4%, to 11528 in afternoon trading. The measure earlier hit its highest intraday point since September 2008 at 11534.37, and was on pace to finish at a two-year closing high. J.P. Morgan Chase climbed 2.6%, Bank of America added 2.1% and American Express advanced 1.8%.
The Nasdaq Composite gained 0.6% to 2666, on track to hit a fresh three-year closing high. The Standard & Poor's 500-stock index rose 0.6% to 1254, set to reach its highest close since September 2008 and led by its financial sector.
Financials received a boost from expectations that deal-making in the sector may continue next year after Canadian bank Toronto-Dominion Bank agreed to acquire Chrysler Financial, the auto lender owned by Cerberus Capital Management, for $6.3 billion. Shares of Toronto-Dominion rose 2.9%.
The broader market also received a boost after China Vice Premier Wang Qishan said China supports efforts by European officials to stabilize the global markets hit by the euro zone's debt crisis.
Fitch Ratings became the third major credit rating agency this month to put Greece's ratings on review for a possible downgrade into junk territory. Still, the market had little reaction to the news, as investors have braced themselves for a long recovery in Europe.
Mid-day Tuesday U.S. stocks climbed Tuesday, led by the overnight dollar's decline and M&A activity boosted hopes for more takeovers next year and a Chinese official's comments boosted sentiment around the fragile eurozone. The dollar weakened against both the euro and the yen. The euro was recently at $1.3116, down from $1.3120 late Monday.
The Dow Jones Industrial Average rose 48 points, or 0.4% to 11526. Financial components led the measure in early trading, with J.P. Morgan Chase up 2%, American Express up 1.8% and Bank of America up 1.4%.
The Nasdaq Composite gained 0.4% to 2661. The Standard & Poor's 500-stock index rose 0.5% to 1253, also led by its financials sector.
TUESDAY: Before the Bell heading into the open, futures on the DJIA and the SPX are trading roughly 22 points and 3 points above fair value, respectively. Look for the Dow to find support at 11,400-11,450, with resistance at 11,500-11,520. The SPX, has resistance at 1,250, and support at 1,240. The dollar moved lower overnight as the Euro gained supported by market news that Asian interests may move to support European markets and it currency. The euro gained on speculation investments by China, which holds a record $2.65 trillion in foreign-exchange reserves, will ease Europe’s sovereign fiscal crisis. The euro climbed 0.2 percent to $1.3154 as of 6:23 a.m. in New York.
MONDAY: U.S. Stocks closed flat in choppy low volume trading Monday with energy stocks getting a boost by colder temperatures. Precious metals gain on valid on economic concerns. The DJIA was down 13.85 (-0.12%) to 11478.13, S&P up 3.17 (+0.26%) to 1247.08, NASDAQ up 6.59 (+0.25%) to 2649.56.
The EURUSD extended Friday’s decline to reach an intraday low of 1.3124 during the overnight trade, and late Monday, the euro was at $1.3120 as debt contagion fears in the Euro-Zone continue to weigh on investors. The euro slipped below $1.31 on Monday, falling briefly below its 200-day moving average. The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies, was at 80.599 late Monday.The dollar was at Y83.73 from Y83.96, while the euro was at Y109.90 from Y110.66. The U.K. pound was at $1.5514 from $1.5520. The dollar was at CHF0.9652 from CHF0.9703. The euro's drop against the Swiss franc fueled some speculation the Swiss central bank could step into currency markets, exploiting thin end-of-year liquidity to halt the currency's rise.
In afternoon trading, the dollar relaxed earlier gains and the DJIA was 11,498.76 up 6.85 points at 2:30 p.m. EST. The S&P was up 4.75 points and Nasdaq was 13.51 point higher.
U.S. equities moved slightly lower by 10:30 AM on light trading as the dollar regained Friday's position. The Dow Jones Industrial Average fell 23 points, or 0.2%, to 11474. The Nasdaq Composite shed 0.2% to 2637. The Standard & Poor's 500-stock index edged down less than one point to 1244.
The euro fell to a series of all-time lows against the Swiss franc as investors concerned about the euro zone's festering government-debt problems continued to shun the common currency. The euro was trading recently at $1.3117, down from $1.3182 late Friday in New York. The U.S. Dollar Index, which tracks the dollar against a basket of other currencies, gained 0.3%.
U.S. stocks opened higher on Monday. Stocks started the holiday-shortened week modestly green on Monday morning extending two weeks of low volume trading, showing slight gains as the market was boosted by a choppy lower dollar before the bell and rising materials stocks. The Dow Jones Industrial Average gained 12 points, or 0.1%, to 11503. Materials companies led the Dow higher, with Caterpillar rising 0.8%.The Nasdaq Composite rose 0.3% to 2651. The Standard & Poor's 500-stock index rose 0.3% to 1247. BEFORE THE BELL: U.S. Futures Up as the Dollar declined just before the bell. President Barack Obama signed a $858 billion package Friday renewing tax cuts for another two years and extending expiring unemployment benefits through next year.
CRUDE OIL:
FRIDAY: Market Closed
Gasoline Prices Hit $3 a Gallon Nationwide
Today, the national average price for a gallon of gas has risen to over $3 a gallon for the first time since October, 2008, when it felt like the bottom had just dropped out of the American economy.
According to the AAA Fuel Gauge Report, the price for a gallon of gasoline nationwide hit $3.013. California once again has the highest gas prices in the Lower 48 states, hovering at about $3.27 a gallon. In total, 26 states plus the District of Columbia have gas prices exceeding $3 a gallon, while Colorado has the lowest average gas prices, about $2.75 a gallon. The rise in gas prices coincides with a rise in crude prices, which recently topped $90 a barrel...another high not seen since October 2008.
THURSDAY: U.S. CRUDE OIL: $91.61 per barrel
THURSDAY OIL FUTURES: Nymex Crude Closes Up $1.11 At $91.59/Bbl
Feb. crude oil futures were up 13 cents to $90.61 at 6:41 am ET, Jan. reformulated gasoline futures were up 0.63 cent to 241.82 cents and Jan. heating oil futures were up 0.19 cents to 254.21 cents in quiet pre-holiday trading.
WEDNESDAY: U.S. Crude Oil: $90.63 per barrel
Feb. crude oil futures were up 13 cents to $90.61 at 6:41 am ET, Jan. reformulated gasoline futures were up 0.63 cent to 241.82 cents and Jan. heating oil futures were up 0.19 cents to 254.21 cents in quiet pre-holiday trading.
WEDNESDAY: U.S. Crude Oil: $90.63 per barrel
WEDNESDAY'S OIL FUTURES: Nymex Crude Settles Up 66c At $90.48/Bbl
Crude Oil Hits Two-Year High On Drop In US Oil Stockpile Supply
Crude futures rose to a fresh two-year high Wednesday after a government report showed continued declines in weekly U.S. oil stockpiles.The data helped confirm a similar report late Tuesday from the American Petroleum Institute, a trade group, which reported U.S. crude stockpiles fell by 5.8 million barrels.
Light, sweet crude for February delivery recently traded 70 cents, or 0.8%, higher at $90.52 a barrel on the New York Mercantile Exchange, after hitting $90.80, the highest price since October, 2008. Brent crude on the ICE futures exchange traded 50 cents higher at $93.70 a barrel.
U.S. crude stockpiles fell by 5.3 million barrels in the week ended Dec. 17, the U.S. Department of Energy reported. The decline was much larger than the 2.3 million-barrel drop analysts had expected.
Gasoline stockpiles rose by 2.4 million barrels, while stocks of distillates, which include heating oil and diesel, fell by 600,000 barrels.
Front-month January reformulated gasoline blend-stock, or RBOB, recently traded 2.07 cents higher at $2.4192 a gallon. January heating oil recently traded 1.64 cents higher at $2.5328 a gallon.
Department of Energy Reported:
DOE: US Refineries Ran At 87.7%; Seen 87.80%
Refineries Ran At 87.7% Vs 88.0% Week Ago
US Crude Oil Stocks -5.333M Bbl In Wk; Seen -2.3M BblCrude Oil Hits Two-Year High On Drop In US Oil Stockpile Supply
Crude futures rose to a fresh two-year high Wednesday after a government report showed continued declines in weekly U.S. oil stockpiles.The data helped confirm a similar report late Tuesday from the American Petroleum Institute, a trade group, which reported U.S. crude stockpiles fell by 5.8 million barrels.
Light, sweet crude for February delivery recently traded 70 cents, or 0.8%, higher at $90.52 a barrel on the New York Mercantile Exchange, after hitting $90.80, the highest price since October, 2008. Brent crude on the ICE futures exchange traded 50 cents higher at $93.70 a barrel.
U.S. crude stockpiles fell by 5.3 million barrels in the week ended Dec. 17, the U.S. Department of Energy reported. The decline was much larger than the 2.3 million-barrel drop analysts had expected.
Gasoline stockpiles rose by 2.4 million barrels, while stocks of distillates, which include heating oil and diesel, fell by 600,000 barrels.
Front-month January reformulated gasoline blend-stock, or RBOB, recently traded 2.07 cents higher at $2.4192 a gallon. January heating oil recently traded 1.64 cents higher at $2.5328 a gallon.
Department of Energy Reported:
DOE: US Refineries Ran At 87.7%; Seen 87.80%
Refineries Ran At 87.7% Vs 88.0% Week Ago
US Crude Oil Stocks -5.333 Mln Bbl At 340.685 Mln Bbl
US Distillate Stocks -0.589 Mln Bbl At 160.716 Mln Bbl
US Gasoline Stocks +2.4M Bbl In Wk; Seen +0.9M Bbl
TUESDAY OIL FUTURES: Nymex Crude Settles 45 Higher At $89.82/Bbl
Oil prices settled at a fresh two-year high Tuesday, lifted by a stronger stock market and upbeat sentiment on the U.S. economy.
Light, sweet crude for January delivery finished up 45 cents, or 0.5%, at $89.82 a barrel on the New York Mercantile Exchange, the highest settlement since October 2008. Brent crude on the ICE futures settled up 46 cents, or 0.5%, at $93.20 a barrel.
Nymex crude traded as high as $89.97 midway through the day, but fell short of the $90 price point that many investors view as a key threshold.
Front-month Brent crude on the ICE futures exchange hit a two-year high of $93.22 a barrel before falling back to $92.57, down 17 cents, or 0.2% so far for the day. On the New York Mercantile Exchange, light, sweet crude for February delivery slipped 6 cents, or 0.1%, at $89.31 a barrel.
Wednesday, oil market participants will turn their attention to the Department of Energy's report on U.S. energy inventories, which last week showed a 9.9 million-barrel decline in crude stocks.
MONDAY'S OIL FUTURES: Nymex Crude Closes 79c Higher At $88.81/Bbl
Light, sweet crude for January delivery settled up 79 cents, or 0.9%, at $88.81 a barrel on the New York Mercantile Exchange. With the January contract expiring Monday, February crude rose 77 cents, or 0.9%, settling at $89.37. Brent crude on the ICE futures rose $1.07, or 1.2%, to finish at $92.74 a barrel. Oil prices settled at a fresh two-year high Tuesday, lifted by a stronger stock market and upbeat sentiment on the U.S. economy.
Light, sweet crude for January delivery finished up 45 cents, or 0.5%, at $89.82 a barrel on the New York Mercantile Exchange, the highest settlement since October 2008. Brent crude on the ICE futures settled up 46 cents, or 0.5%, at $93.20 a barrel.
Nymex crude traded as high as $89.97 midway through the day, but fell short of the $90 price point that many investors view as a key threshold.
Front-month Brent crude on the ICE futures exchange hit a two-year high of $93.22 a barrel before falling back to $92.57, down 17 cents, or 0.2% so far for the day. On the New York Mercantile Exchange, light, sweet crude for February delivery slipped 6 cents, or 0.1%, at $89.31 a barrel.
Wednesday, oil market participants will turn their attention to the Department of Energy's report on U.S. energy inventories, which last week showed a 9.9 million-barrel decline in crude stocks.
MONDAY'S OIL FUTURES: Nymex Crude Closes 79c Higher At $88.81/Bbl
Gasoline futures leaped higher on reports that Hovensa LLC has delayed by a week the restart of its gasoline-making unit at its 500,000-barrel-a-day St. Croix refinery. January reformulated gasoline blend-stock, or RBOB, settled up 6 cents, or 2.6%, at $2.3778 a gallon.
NATURAL GAS:
THURSDAY: Natural Gas: $4.07
THURSDAY US GAS: Futures Settle 1.7% Lower At $4.083/MMBtu
January natural gas was trading in negative territory all session heading into today's inventory data. Following the data, which showed a draw of 184 bcf versus consensus of a draw down of 180 bcf, natural gas saw a mixed reaction to the data and is now 1.0% lower at $4.11 per MMBtu.
WEDNESDAY: Natural Gas: $ 4.14
THURSDAY US GAS: Futures Settle 1.7% Lower At $4.083/MMBtu
January natural gas was trading in negative territory all session heading into today's inventory data. Following the data, which showed a draw of 184 bcf versus consensus of a draw down of 180 bcf, natural gas saw a mixed reaction to the data and is now 1.0% lower at $4.11 per MMBtu.
WEDNESDAY: Natural Gas: $ 4.14
WEDNESDAY'SUS GAS: Futures Close 2.1% Higher At $4.14/MMBtu
Natural gas futures regained some ground Wednesday ahead of an expected report of a large draw of gas from storage.
Natural gas for January delivery on the New York Mercantile Exchange settled 9.3 cents, or 2.3%, higher at $4.152 a million British thermal units after opening 1 cent higher at $4.069/MMBtu.
Traders expect the U.S. Energy Information Administration to report on Thursday morning a larger-than-normal withdrawal of gas from storage due to colder-than-usual temperatures last week, which lent support to gas futures prices.
Nymex Jan $4.152 +9.3c
Nymex Feb $4.188 +10.4c
Nymex March $4.196 +10.0c
CASH HUB RANGE PREVIOUS DAY
Henry Hub $3.97-$4.05.....$4.0825-$4.21
Transco 65 $3.95-$4.06.....$4.10-$4.17
Tex East M3 $5.00-$7.72....$7.50-$9.00
Transco Z6 $5.25-$8.00.....$8.50-$10.00
SoCal $3.8875-$3.95.....$4.025-$4.16
El Paso Perm $3.7525-$3.83.....$3.91-$4.00
El Paso SJ $3.75-$3.81......$3.88-$3.99
Waha $3.80-$3.84......$3.92-$4.02
Katy $3.875-$3.9525.... $4.0275-$4.11
PRECIOUS METALS:
THURSDAY: Gold: $1,380
THURSDAY: Silver: $29.26Thursday's thinly traded December contract settled down $6.80, or 0.1%, at $1,380.00 a troy ounce on the Comex division of the New York Mercantile Exchange. The most actively traded contract, for February delivery, settled down $6.90, or 0.1%, at $1,380.50.
Engelhard Corp's base price for industrial gold bullion was $1376.48 per troy ounce, down $13.53 from previous. It's selling price for gold in fabricated form was $1479.72, down $14.54.
Handy & Harman's base price for gold was $1373.50 per troy ounce,down $13.50. The fabricated form price was $1483.38, down $14.58.
Settlements (range includes floor and electronic trading):
London PM Gold Fix: $1,373.50; previous PM $1,387.00
Engelhard Corp's base price for industrial gold bullion was $1376.48 per troy ounce, down $13.53 from previous. It's selling price for gold in fabricated form was $1479.72, down $14.54.
Handy & Harman's base price for gold was $1373.50 per troy ounce,down $13.50. The fabricated form price was $1483.38, down $14.58.
Settlements (range includes floor and electronic trading):
London PM Gold Fix: $1,373.50; previous PM $1,387.00
Feb gold $1,380.50, down $6.90; Range $1,372.60-$1,389.00
Mar silver $29.328, down 5.7 cents; Range $28.945-$29.420
Jan platinum $1,723.10, down $7.80; Range $1,711.00-$1,731.90
Mar palladium $758.10, up $2.95; Range $744.70-$755.60
Feb. gold futures, which have surged this year, were off $3.60 to $1383.80 at 6:35 am ET on profit taking. Speculators frustrated by inability to push yellow metal past the $1400 level after another a range bound session in Asia. Euro-area debt concerns will continue to underpin on dips, but buying momentum is limited, with stocks performing well and economic fundamentals improving. March silver futures were off 15.5 cents to $29.23. Jan. platinum futures were off $1.80 to $1729.10 and March palladium futures were off $4.40 to $750.75.
WEDNESDAY: Gold: $ 1,386
Mar silver $29.328, down 5.7 cents; Range $28.945-$29.420
Jan platinum $1,723.10, down $7.80; Range $1,711.00-$1,731.90
Mar palladium $758.10, up $2.95; Range $744.70-$755.60
Feb. gold futures, which have surged this year, were off $3.60 to $1383.80 at 6:35 am ET on profit taking. Speculators frustrated by inability to push yellow metal past the $1400 level after another a range bound session in Asia. Euro-area debt concerns will continue to underpin on dips, but buying momentum is limited, with stocks performing well and economic fundamentals improving. March silver futures were off 15.5 cents to $29.23. Jan. platinum futures were off $1.80 to $1729.10 and March palladium futures were off $4.40 to $750.75.
WEDNESDAY: Gold: $ 1,386
WEDNESDAY: Silver:$ 29.25
WEDNESDAY: The most actively traded contract, for February delivery, was recently down 0.1%, or $1.40, at $1,387.40 per troy ounce on the Comex division of the New York Mercantile Exchange.
Engelhard Corp's base price for industrial gold bullion was $1390.01 per troy ounce, up $4.01 from previous. It's selling price for gold in fabricated form was $1494.26, up $4.31.
Handy & Harman's base price for gold was $1387.00 per troy ounce, up $4.00. The fabricated form price was $1497.96, up $4.32.
TUESDAY: The most actively traded contract, for February delivery, settled up $2.70, or 0.2%, at $1,388.80 per troy ounce on the Comex division of the New York Mercantile Exchange. The thinly traded front-month contract, for December delivery, settled up $2.70, or 0.2% higher, at $1,388.20 per troy ounce. Precious metals futures rise as the dollar weakens before the bell.
Engelhard Corp's base price for industrial gold bullion was $1386.00 per troy ounce, up $3.00 from previous. It's selling price for gold in fabricated form was $1489.95, up $3.23.
Handy & Harman's base price for gold was $1383.00 per troy ounce, up $3.00. The fabricated form price was $1493.64, up $3.24.
MONDAY: Gold futures rose Monday as the dollar relaxed its earlier gains and economic concerns weighed. Comex gold futures settled higher Monday as global political and economic worries saw traders cover previously sold short positions.
The most actively traded contract, for February delivery, settled up 0.5%, or $6.90, at $1,386.10 a troy ounce on the Comex division of the New York Mercantile Exchange. The thinly traded December-delivery contract gained 0.5%, or $6.90, to settle at $1,385.50 per troy ounce.
Monday Settlements (range includes floor and electronic trading):
London PM Gold Fix: $1,380.00; previous PM $1,368.50
Feb gold $1,386.10, up $6.90; Range $1,376.60-$1,388.90
Mar silver $29.355, up 22.2 cents; Range $28.810-$29.560
Jan platinum $1,710.70, up $12.20; Range $1,698.40-$1,711.70
Mar palladium $744.75, up $6.15; Range $736.35-$749.90
Engelhard Corp's base price for industrial gold bullion was $1383.00 per troy ounce, up $11.52 from previous. It's selling price for gold in fabricated form was $1486.72, up $12.38.
Handy & Harman's base price for gold was $1380.00 per troy ounce, up $11.50. The fabricated form price was $1490.40, up $12.42.
BASE METALS:
THURSDAY: Copper $4.25 per pound
Thursday's Comex copper futures settled lower. The most actively traded contract, for March delivery, settled down 1.65 cents at $4.2585 per pound on the Comex division of the New York Mercantile Exchange.
Comex copper future trading closed an hour early Thursday, at 12 p.m. EST, in observance of the Christmas day holiday Friday.
The most actively traded contract, for March delivery, settled down 1.65 cents at $4.2585 per pound Comex division of the New York Mercantile Exchange. Copper prices began declining overnight as investors across the globe moved to cash positions ahead of the Christmas holiday Friday.
WEDNESDAY : Copper $ 4.27 a pound
TUESDAY: Copper $ 4.28 a pound
The most actively traded contract, for March delivery, was recently up 1.7%, or 7 cents, at $4.2760 per pound on the Comex division of the New York Mercantile Exchange. The contract hit a new all-time record of $4.2895 earlier this morning, breaching the $4.2605 level set amid thin trading on May 5, 2008.
Copper prices revved up after China, the world's largest copper consumer, said its imports of refined copper rose 37% in November from a month earlier, to 232,298 metric tons. November imports are up 19% from a year earlier.
The most actively traded contract, for February delivery, settled up 0.5%, or $6.90, at $1,386.10 a troy ounce on the Comex division of the New York Mercantile Exchange. The thinly traded December-delivery contract gained 0.5%, or $6.90, to settle at $1,385.50 per troy ounce.
Monday Settlements (range includes floor and electronic trading):
London PM Gold Fix: $1,380.00; previous PM $1,368.50
Feb gold $1,386.10, up $6.90; Range $1,376.60-$1,388.90
Mar silver $29.355, up 22.2 cents; Range $28.810-$29.560
Jan platinum $1,710.70, up $12.20; Range $1,698.40-$1,711.70
Mar palladium $744.75, up $6.15; Range $736.35-$749.90
Engelhard Corp's base price for industrial gold bullion was $1383.00 per troy ounce, up $11.52 from previous. It's selling price for gold in fabricated form was $1486.72, up $12.38.
Handy & Harman's base price for gold was $1380.00 per troy ounce, up $11.50. The fabricated form price was $1490.40, up $12.42.
BASE METALS:
THURSDAY: Copper $4.25 per pound
Thursday's Comex copper futures settled lower. The most actively traded contract, for March delivery, settled down 1.65 cents at $4.2585 per pound on the Comex division of the New York Mercantile Exchange.
Comex copper future trading closed an hour early Thursday, at 12 p.m. EST, in observance of the Christmas day holiday Friday.
The most actively traded contract, for March delivery, settled down 1.65 cents at $4.2585 per pound Comex division of the New York Mercantile Exchange. Copper prices began declining overnight as investors across the globe moved to cash positions ahead of the Christmas holiday Friday.
WEDNESDAY : Copper $ 4.27 a pound
TUESDAY: Copper $ 4.28 a pound
Copper Settles At All-Time Record
Comex copper futures vaulted to fresh record highs Tuesday on upbeat Chinese trade data and a supply interruption at one of the world's largest copper mines. The most actively traded contract, for March delivery, was recently up 1.7%, or 7 cents, at $4.2760 per pound on the Comex division of the New York Mercantile Exchange. The contract hit a new all-time record of $4.2895 earlier this morning, breaching the $4.2605 level set amid thin trading on May 5, 2008.
Copper prices revved up after China, the world's largest copper consumer, said its imports of refined copper rose 37% in November from a month earlier, to 232,298 metric tons. November imports are up 19% from a year earlier.
The report sent copper prices on both sides of the Atlantic to record highs. Three-month delivery copper on the London Metal Exchange set a record of $9,392 per metric ton before closing trade at $9,365 per metric ton.
Tuesday Settlements (range includes floor and electronic trading):
Dec copper $4.2705, up 7 cents; Range $4.2170-$4.2805
Mar copper $4.2760, up 7 cents; Range $4.1920-$4.2895
Tuesday Settlements (range includes floor and electronic trading):
Dec copper $4.2705, up 7 cents; Range $4.2170-$4.2805
Mar copper $4.2760, up 7 cents; Range $4.1920-$4.2895
U.S. TREASURYS/BONDS:
THURSDAY: Treasurys declined, lifting the yield on the 10-year note to 3.38%. Treasury prices came under pressure on Thursday, pushing yields up and towards a weekly rise. Yields on 10-year notes (UST10Y) , which move inversely to prices, rose 4 basis points to 3.39%. A basis point is one one-hundredth of a percent.
Yields on 2-year notes (UST2YR) rose 2 basis points to 0.66%.
Thirty-year bond yields (UST30Y) edged up by 1 basis points to 4.46%.
The bond market is expected to close at 2 p.m. Eastern time Thursday and remain shut on Friday for Christmas. The government will auction $35 billion in 2-year notes on Monday, followed by $35 billion in 5-year debt (UST5YR) on Tuesday. A sale of $29 billion in 7-year notes (UST7YR) on Wednesday will end the sales in what will be another holiday-shortened week. Treasurys declined at market open, lifting the yield on the 10-year note up to 3.37%.
Yields on 2-year notes (UST2YR) rose 2 basis points to 0.66%.
Thirty-year bond yields (UST30Y) edged up by 1 basis points to 4.46%.
The bond market is expected to close at 2 p.m. Eastern time Thursday and remain shut on Friday for Christmas. The government will auction $35 billion in 2-year notes on Monday, followed by $35 billion in 5-year debt (UST5YR) on Tuesday. A sale of $29 billion in 7-year notes (UST7YR) on Wednesday will end the sales in what will be another holiday-shortened week. Treasurys declined at market open, lifting the yield on the 10-year note up to 3.37%.
WEDNESDAY: Treasurys fell Wednesday after the Federal Reserve completed its last bond purchase of the week and as market participants anticipated stronger upcoming data and year-end Treasury note auctions.
With Fed bond purchases out of the way for the week, Treasurys market participants were anticipating stronger data Thursday, with durable-goods orders in November seen down just 0.6% after they fell 3.4% in October.
In afternoon trading, the two-year Treasury was off 1/32 to 0.630%, the seven-year note was off 11/32 to 2.721% and the 10-year Treasury was off 11/32 to yield 3.346%. The 30-year bond was off 14/32 to 4.445%.
Treasury prices were little changed. the Fed is expected to buy about $2.5 billion in Treasurys maturing in the next 11 to 17 years in its last Treasury buying operation of the week. Thus far this week, the Fed has already bought $23.978 billion in Treasury securities in four operations.
After Wednesday's purchase, the Fed will have just two buying operations left on its schedule before year-end. Unlike this week's purchases, those operations will be met with a hefty amount of supply. The government next week, in its final round of note sales for 2010 is expected to sell some $99 billion new notes,
Traders said the prospect of another Treasury purchase from the Federal Reserve was also helping the U.S. government bond market to improve a bit.
In recent trading, the two-year Treasury note was flat to yield 0.606%, the seven-year note was flat to yield 2.669% and the 10-year Treasury was flat to yield 3.303%. The 30-year was flat to yield 4.418%.
TUESDAY: Demand for Treasurys was mixed, with declines in the two-year note lifting its yield to 0.61% while increasing demand for the 10-year note pushed its yield down to 3.33%. At the market open, demand for Treasurys was mixed. The two-year note was slightly lower, while the 10-year note rose, pushing its yield down to 3.34%.
MONDAY: Treasury prices deteriorated into the afternoon Monday after the Federal Reserve bought Treasurys twice in thin, year-end trading conditions. In recent trading, Treasurys maturing in the next five to 30 years were lagging, with the 30-year the hardest hit. The 30-year was off 10/32 to 4.461% and the 10-year down 4/32 to yield 3.353%. The Fed's Treasury holdings have surpassed $1 trillion after the second round of POMO today. The two year was flat to 0.605%.
Treasury prices pushed up Monday as the holiday-shortened week kicked off, spurred higher ahead of hefty purchases of Treasurys by the Federal Reserve. Demand for Treasurys increased, sending the yield on the 10-year note down to 3.32%.
The Fed will buy Treasurys twice Monday in what will likely be the largest one-day Treasury purchase it has done thus far. The Fed is expected to buy a total of $13 billion to $17 billion Treasurys Monday, first with a morning purchase of notes maturing in the next eight to 10 years, and then with an afternoon purchase of four to six-year Treasury securities The Fed will also buy Treasurys twice Tuesday, for a total of $8 billion to $11 billion.
Treasury prices pushed up Monday as the holiday-shortened week kicked off, spurred higher ahead of hefty purchases of Treasurys by the Federal Reserve. Demand for Treasurys increased, sending the yield on the 10-year note down to 3.32%.
The Fed will buy Treasurys twice Monday in what will likely be the largest one-day Treasury purchase it has done thus far. The Fed is expected to buy a total of $13 billion to $17 billion Treasurys Monday, first with a morning purchase of notes maturing in the next eight to 10 years, and then with an afternoon purchase of four to six-year Treasury securities The Fed will also buy Treasurys twice Tuesday, for a total of $8 billion to $11 billion.
In recent trading, the 10-year note was up 15/32 to 3.278% and the five-year note was up 8/32 to 1.909%. The two-year was up 1/32 to 0.589% and the 30-year up 25/32 to yield 4.392%. The gains add to a bond market rally on Friday, further helping Treasurys to recover a bit from their recent sell-off. The gains add to a bond market rally on Friday.
MARKET NOTE: The bond market will close early Thursday and be closed Friday for the Christmas holiday in the U.S.
THURSDAY, DEC. 23, 2010; 12:45 PM EST:
3 Month 0.12% +0.01 (9.09%)
6 Month 0.18% 0.00 (0.00%)
2 Year 0.65% 0.00 (0.00%)
5 Year 2.04% +0.02 (0.99%)
10 Year 3.38% +0.01 (0.30%)
30 Year 4.45% +0.01 (0.23%)
6 Month 0.18% 0.00 (0.00%)
2 Year 0.65% 0.00 (0.00%)
5 Year 2.04% +0.02 (0.99%)
10 Year 3.38% +0.01 (0.30%)
30 Year 4.45% +0.01 (0.23%)
U.S. ECONOMIC NEWS:
FRIDAY:
New Tax Law Packed With Obscure
Business Tax Cuts
WASHINGTON (AP) — The massive new tax bill signed into law by President Barack Obama is filled with all kinds of holiday stocking stuffers for businesses: tax breaks for producing TV shows, grants for putting up windmills, rum subsidies for Puerto Rico and the Virgin Islands.
There is even a tax break for people who buy race horses.
Millions of homeowners, however, might feel like they got a lump of coal. Homeowners who don't itemize their deductions will lose a tax break for paying local property taxes.
The business tax breaks are part of sweeping legislation that extends Bush era tax cuts for families at every income level through 2012. Obama signed the $858 billion measure a week ago. It also provides a new payroll tax cut for wage earners and extends jobless benefits to the long-term unemployed.
Most of the business tax breaks — about 50 in all — are part of a package that expires each year, creating uncertainty for tax planners but lots of business for lobbyists. Many of these tax breaks have been around for years but expired at the end of 2009 because lawmakers couldn't agree how to pay for them.
The new law extends most of them through 2011, some through 2012. They will be paid for with borrowed money.
Nearly 1,300 businesses and trade groups formed a coalition urging Congress to extend the business tax breaks. Others lobbied for specific provisions, including a generous tax credit for research and development and subsidies to produce alternative energy.
There is a generous tax break for banks and insurance companies that invest overseas, a tax credit for railroad track maintenance, more generous write-offs for upgrading motorsport race tracks, and increased deductions for businesses that donate books and computers to public schools and libraries.
Many of the tax breaks are designed to encourage economic activity. But passing them each year at the last minute, or skipping a year and passing them retroactively, isn't terribly efficient, said Clint Stretch, a tax expert at Deloitte Tax LLP. "It gives it a lot of dignity to call it a 'system,' " Stretch said.
Every year, taxpayers risk losing their favorite tax breaks, if they are not renewed. That's what happened to millions of homeowners. For 2008 and 2009, homeowners who didn't itemize their deductions were able to get an extra deduction — on top of the standard deduction — for paying local property taxes. Individuals could reduce their taxable income by as much as $500, couples could cut theirs by $1,000.
The provision, which has saved homeowners about $1.6 billion a year, expired for 2010 and was left out of the new tax law.
"A lot of Americans don't make so much money that they itemize their tax returns. But those same Americans own property," said Sen. Max Baucus, D-Mont., who sponsored the original tax break. "It seems to me that they, too, should have the ability to deduct it. It's a matter of equity."
Taxpayers who itemize will continue to be able to deduct local property taxes. About two-thirds of tax filers don't itemize.
Among the provisions in the new law:
—A tax break that allows profitable companies to write off large capital expenditures immediately — rather than over time — giving some companies huge tax shelters.
The tax break, known as bonus depreciation, benefits automakers, utilities, heavy equipment makers like Caterpillar Inc., and John Deere, air freight companies like Fedex Corp., and wireless companies like Verizon and AT&T, said Anne Mathias, director of research for the Washington Research Group, which provides research to institutional and corporate investors. It will save companies nearly $21 billion over the next decade.
"It helps companies that use expensive capital equipment, that spend a lot of money," Mathias said. "It also helps places where the economy is growing, like wireless infrastructure, because there is a pretty big wireless build out right now."
The tax break is also available to people who buy race horses and farmers who buy cattle for breeding or dairy, according to a depreciation list produced by the Internal Revenue Service.
—An exemption that allows banks, insurance companies and other financial firms to shield foreign profits from being taxed by the U.S. through 2011. Cost: $9.2 billion.
The tax break is important to major multinational banks and financial firms, such as Citigroup, Bank of America, Goldman Sachs and Morgan Stanley, and to the financing operations of other international companies, Mathias said.
—A tax credit for research and development, benefiting a wide range of industries, including pharmaceutical and high tech companies. The law extends the tax credit through 2011, at a cost of $13.3 billion.
"The House and the Senate are in the holiday spirit and giving US companies a present of $13 billion in potential R&D Tax Credits!" says a press release by Braithwaite Global Inc., a firm that advises companies on applying for research tax credits.
—Increased tax rebates to Puerto Rico and the Virgin Islands from a tax on rum imported into the United States. The U.S. imposes a $13.50 per proof-gallon tax on imported rum, and sends most of the proceeds to the two U.S. territories.
Previously, the rebate was $10.50 a gallon. The new law extends a more generous rebate of $13.25 a gallon through 2011. Cost: $262 million.
—Extends a grant program for the production of wind, solar and other renewable energy through 2011. Cost: $3 billion.
"This is a great holiday present for the 85,000 American workers in the wind energy industry, tens of thousands of whom will now be able to get back to work in a sector that has been a bright spot in the recession so far," Denise Bode, CEO of the American Wind Energy Association, said in a statement.
—Extends a 50 percent tax credit for expenses related to railroad track maintenance through 2011. Cost $331 million.
—Enhanced deductions for companies that donate food to the needy, books to public schools or computers to public libraries, through 2011. Cost: $537 million.
—A tax break that allows TV and movie productions to more quickly write off expenses, extended through 2011. Sexually explicit productions are ineligible. Cost: $101 million.
THURSDAY:
US Soybean Futures Hit 28-Month High
U.S. soybean futures rallied to a fresh 28-month high Thursday on strong demand and concerns about the development of Argentina crop.
Soybeans for January delivery at the Chicago Board of Trade were recently up 15 3/4 cents, or 1.2%, to $13.44 1/2 a bushel. The March contract, which is the most actively traded, reached similar highs.
The soybean market has rallied in the last month, boosted by potential crop problems in Argentina, which has been plagued by hot and dry weather. While the weather poses more immediate problems to corn that's in a crucial growth stage, the soybean crop could be threatened as well, analysts say.
Corn futures have set new 29-month highs this week, with the March contract recently trading near flat at $6.09 1/4 a bushel.
Argentina is the world's third-largest producer of soybeans behind the U.S. and Brazil. The South American country is being counted on to relieve the strain on U.S. supplies amid strong global demand. The Argentina soybean crop will reach a critical stage in their development next month ahead of a spring harvest.
Global soybean demand continues to be robust. The U.S. Department of Agriculture reported Thursday that weekly export sales were up sharply from a week ago. The USDA also announced new export sales to an undisclosed destination.
Traders also are anticipating that index funds will pour more money into agricultural commodities at the start of the year, pushing prices higher, analysts said.
The USDA reported weekly export sales of 827,800 metric tons, up from 173,600 the prior week. Traders were expecting anywhere between 400,000 and 1.2 million metric tons. The government also reported a new sale of 150,000 metric tons to an undisclosed destination.
Traders said the U.S. Census Bureau's November soybean crush report issued Thursday was in line with expectations. The bureau reported the November soybean crush, which is the amount of soybeans crushed into oil and meal, at 155.0 million bushels, up slightly from the average analyst estimate of 154.7 million bushels.
The number was down from the prior month's total of 157.2 million, due in part to the higher soybean prices, which pressured margins, analysts said.
CONSUMER SENTIMENT
SOMEWHAT IMPROVES
The final Consumer Sentiment Survey for December from the University of Michigan came in at 74.5, which is slightly better than the preliminary reading of 74.2. The final December reading is the second best of the past two years, behind only a reading of 76.0 this past July.
NEW HOME SALES INCREASE
Builders Sold Fewer New Homes Than Forecast in November
New home sales for November increased 5.5% month-over-month to an annualized rate of 290,000 units, but that was a bit below the rate of 300,000 units that had been expected, on average, among economists polled by Briefing.com. Nonetheless, the 5.5% increase makes for a nice follow up to the 10.7% drop that occurred in October.
FANNIE, FREDDIE MORTGAGE DELINQUENCY DATA
Fannie Mae says serious delinquencies on single-family mortgages declined further in October from September, while Freddie Mac says such delinquencies rose in November for a second straight month, after declining since February.
DURABLE GOODS DECLINED
Slumping demand for airplanes offset gains in other parts of the factory sector and caused U.S. durable goods orders to fall below expectations during November. Durable-goods orders decreased by 1.3% to a seasonally adjusted $193.71 billion, the Commerce Department said. The drop was more than double the 0.6% drop that was projected by economists.
The report showed a key barometer of capital spending, new orders for non-defense capital goods excluding aircraft, rose, by 2.6%--an indication businesses are spending as the economy recovers.
CONSUMER SPENDING DECLINED
Separate data showed U.S. consumer spending was modest in November after rising by the largest amount in more than a year in October. Consumer spending rose by 0.4% in November while Americans' incomes grew by 0.3%. Economists had forecast spending would increase by 0.5% and incomes by 0.2% in November.
Initial unemployment claims fell by 3,000 to 420,000 in the week ended Dec. 18, the Labor Department said in its weekly report. The previous week's figures were revised upward slightly to 423,000 from 420,000.
WEDNESDAY:
A SOBERING REALITY
Inflation, Oil and Gold All Rise Together
By Benjamin Train
Wednesday, December 22, 2010
The upward price trend in the global price of crude oil, commodities, precious metals and agricultural commodities are all extremely clear signals that global inflation is the actual condition of the economic exchange traded currencies.
Any government agency that excludes those items from their reported inflation figures are committing a fraud. Anyone who studies economics understands that a given commodity's price is governed by demand and the price paid for that commodity.
By "inflation" one generally means a persistent rise in the general price level in a basket of items, rather than a once-time rise in a single item, while "deflation" is persistent falling price level for a basket of items.
Any government agency that excludes those items from their reported inflation figures are committing a fraud. Anyone who studies economics understands that a given commodity's price is governed by demand and the price paid for that commodity.
By "inflation" one generally means a persistent rise in the general price level in a basket of items, rather than a once-time rise in a single item, while "deflation" is persistent falling price level for a basket of items.
An inflationary situation is also where there is too much money chasing too few goods.This is basically when the aggregate demand in an economy exceeds the aggregate supply. As products/services are scarce in relation to the money available in the hands of buyers, prices of the products/services rise to adjust for the larger quantum of money chasing them.
There are several additional economic conditions that are also deemed inflationary. But without developing a complete treatise here in this posting on basic economic, I'd say that much of the economic data published by the U.S. Government and Federal Reserve is a smoke and mirror facade. The inflation-adjusted rise of an item is more "expensive" by standards, but generates more of a "mean" price guideline, than one that is not. A seasonally adjusted figure is an entirely different form of "mean" number generator system.
When prices are noted as rising and the population is told that "inflationary pressures were even more muted than previously expected". That U.S. inflation is "flat", after we eliminate energy and food to get it, is useless and not the truth. But what baffles me more is that the U.S. media blindly reports what it is told, and somehow the public and analysts simply go along with it.
Eliminating energy and food from key core inflation numbers as a public statement is not in the public's best interest, and it is a violation of a public trust and obligation given to our government officials.
Estimated U.S. Economy Growth 2.6%
The Commerce Department showed that the US economy expanded at a 2.6 percent annual rate in the third quarter, below expectations, the final revision shows .
The revised increase in gross domestic product compares with a 2.5 percent estimate issued last month and was less than the median forecast of a 2.8 percent. Wednesday's number, the third and final one made by the government for the July-through-September period, missed economists' expectations for GDP to have risen by a higher 2.9%. The main revisions were to consumer spending, which rose by less than previously estimated, and to company inventories, which increased by more than previously thought.
Economists’ projections ranged from gains of 2.5 percent to 3.3 percent, according to the Bloomberg survey of 71 economists. Today’s report is the third and final for the quarter after a 1.7 percent pace in the previous three months.
Inventories rose more than initially reported, while the rise in household purchases was revised down.
Gauges measuring non-consumer inflation were even more muted than previously expected. The government's price index for personal consumption showed a 0.8% rise July through September, compared to a previously estimated 1.0% increase.
The Federal Reserve's preferred gauge-the PCE price index excluding volatile food and energy items-rose at an annual rate of just 0.5% in the third quarter, the lowest since quarterly records began in 1959. That's lower than the original estimate of a 0.8% increase and down from the second quarter's 1.0% increase.
U.S. EXISTING HOME SALES
U.S. sales of used homes was reported by the Government Wednesday to be higher. If you find that hard to believe, well so do real estate agents and home sellers. They only sells realized have been short sales from banks dumping used foreclosed home to foreign investor pools. The U.S. Government reported an increase of 5.6% in November to a "seasonally adjusted annual rate" of 4.68 million, lower than the 4.72 million rate expected by economists. Prices for existing homes rise 0.4% to a median price of $170,600.A high level of unsold homes has contributed to the recent drop in prices. The inventory of previously owned homes listed for sale shrunk by 4.0% at the end of November to 3.71 million available for sale. That represented a 9.5-month supply at the current sales pace, compared with a 10.5-month supply in October. But a big supply of unlisted bank-owned homes and potential foreclosures loom on the horizon, a "shadow inventory" that could push down prices.
Foreclosures have climbed because Americans out of work couldn't keep up with payments on mortgages taken out during the housing boom. The NAR said distressed properties accounted for about a third of sales in November.
US Government House Price Index
U.S. home prices rose 0.7% from September to October but took a deeper than initially estimated fall from August to September, the Federal Housing Finance Agency's latest House Price Index shows.
U.S. home prices were 3.4% below their October 2009 level and 14.5% below their April 2007 peak, the agency said Wednesday. Home prices fell a revised 1.2% from August to September. The FHFA had initially estimated home prices fell 0.7% from August to September.
The FHFA uses loans backed by government-sponsored mortgage companies Fannie Mae and Freddie Mac to make its calculations.
US MORTGAGE APPLICATION VOLUME PLUNGES
The volume of mortgage applications filed in the U.S. last week slumps a seasonally adjusted 19% from the previous week, the Mortgage Bankers Association also reported on an ongoing plunge in refinance activity as mortgage rates held near six-month highs.
CONGRESS KEEPS GOVERNMENT FUNDED THROUGH MARCH 4TH
Congress completes work on a $250 billion package to keep the federal government running through March 4, 2011.
Congress completes work on a $250 billion package to keep the federal government running through March 4, 2011.
TUESDAY:
U.S. Government's Bottom Line Worsens
To $13.5 Trillion Dollar Deficit In FY2010
Report shows that the US Government now has a net financial position running $13.5 Trillion Dollar Deficit in FY2010. The country's deficit--not including long-term obligations to fund Social Security and Medicare--rose by $2 trillion. The government's fiscal 2010 deficit stood at $13.5 trillion, up from $11.5 trillion in fiscal 2009 and $10.2 trillion in fiscal 2008, the U.S. Treasury said in an annual financial report released Tuesday.
A rise in government borrowing and in spending for federal employee and veterans' benefits drove the increase, which more than offset revenue gains.
The report highlights the tough financial position the U.S. government is in as it weighs options toward a sustainable fiscal future without derailing the fragile recovery that has taken hold in the aftermath of the deepest recession since the Great Depression.
At the end of fiscal 2010, the U.S. held $2.9 trillion in assets and $16.4 trillion in liabilities.
Unlike the government's budget reports, its financial reports compare revenue and costs. Budget reports compare receipts and outlays. The government's fiscal 2010 budget deficit came in at $1.3 trillion, slipping from $1.4 trillion in fiscal year 2009.
US Census Reports U.S.Population hits 308.7 Million
The US population has risen by almost 10% in the last 10 years to stand at 308.7 million, according to new data from the US Census Bureau. But the population figure marked the slowest growth in a decade since the Great Depression of the 1930s.The south and west of the country continued their population expansion.This year's US census is expected to confirm that Hispanics are now the largest minority in the country, thanks to rapid growth since the last census 10 years ago.
Roughly 60% of the increase was from individuals born inside the US, while 40% was the result of those immigrating to the country, Mr Groves said..
Hispanics, or Latinos, are responsible for about half of US population growth since 2000. In 2009, one in seven Americans was living in poverty, with the level of working-age poor the highest since the 1960s, the US Census Bureau says. The number of people in poverty increased by nearly four million to 43.6 million between 2008 and 2009, officials said.
The individual states' populations will be used to reapportion the number of representatives each state sends to the US Congress for the next 10 years. The total population of the US grew to 308,745,538 in 2010, up from 281.4m a decade ago, Census director Robert Groves said at a news briefing announcing the 2010 results.
"In every Census since 1790, we have counted all persons who live in the country - we count residents, whether they are citizens or not," Mr Groves said.
The state with the largest population growth was Nevada at roughly 35%, while Michigan was the only state to see a decline. Mr Groves said the slow growth during the Great Depression and the slow growth of the past decade could be attributed to each decade's economic dips.
It was "an assertion on the part of historians" that growth slowed in the 1930s because of the Great Depression, Groves said.
And "the case is pretty attractive to make that the depression hurt the growth rate", he added, referring to the most recent recession. But Mr Groves pointed out that understanding the effect of the economy on population was a complex task and researchers might never be sure how heavily economic problems weighed on growth.
The US is still growing quickly in comparison to other developed nations, like France and England - whose populations increased by about 5% over the last decade.
Congressional changes. The growth in population throughout the US fell largely on Republican-leaning states in the South, which will allow these regions to add seats in the House of Representatives in the next election.
The US Constitution mandates that each of the 435 House districts properly represents roughly the same number of people within each region, and the battle over redrawing of congressional districts is usually partisan and protracted.
The figures could also play a role in the 2012 White House race as the number of seats each state has in the House determines their representation in the Electoral College, which is used to elect each president. Eight states, mostly in the Southern and Western US, will add Congressional seats during the next election, while many states in the Northeast and Midwest will suffer loses in 2012.
FED EXTENDS SWAP LINES WITH FOREIGN BANKS
Tuesday, Federal Reserve authorizes an extension of dollar swap lines with major foreign central banks, reviving a rescue program set up to ease strains from the European debt crisis.
The U.S. Federal Reserve extends until Aug. 1, 2011, temporary U.S. dollar loans to the European Central Bank, as well as the central banks of Canada, England, Japan and Switzerland, amid concerns the debt crisis could intensify again.
MONDAY:
MAJOR STATE BOND NEWS
S&P REVISIONS COULD LOWER SOME MUNI RATINGS
This should be a major red flag to investors of State and local bonds. Another Red Flag is that there is only one underwriting guarantor of bonds remaining in the U.S.
S&P seeks comment on proposed revisions to rating a form of municipal note that allows state and local borrowers to temporarily raise short-term funds backed by a promise to repay with a future bond issue.
FANNIE MAE BOOSTS 2011
ECONOMIC OUTLOOK
Fannie Mae forecasts boosted economic growth of 3.4% for the year, up from its previous outlook of 2.9% growth, on improving consumer spending and confidence, increasing demand for goods, noting downside risk still lingers.
RETAIL SALES FOR THE HOLIDAY'S
Retailers are pulling out all the stops as they count down the days to Christmas, with overtures ranging from keeping doors open around the clock to offering better deals than on their so-called "Black Friday" deals with "official adjusted unemployment" levels at major recession levels and major weather storms keeping holiday shoppers from going to the malls. The last 10 days before Christmas account for 34% of overall holiday sales, says ShopperTrak.
CHICAGO FED NATIONAL
ACTIVITY INDEX SLIPS
Chicago Federal Reserve's National Activity Index falls to -0.46 in November from a revised -0.25 in October, pointing to a sixth straight month of below-trend growth in the U.S. economy.
U.S. EQUITY NEWS:
THURSDAY: DryShips Inc. (DRYS) said it was entering into the tanker industry with a $770 million purchase of 12 vessels from a South Korean shipyard and planned to set the new segment up for a spinoff or initial public offering. Shares were down a penny at $5.96 in after-hours trading.
Fabric and craft supplies retailer Jo-Ann Stores has agreed to be acquired by private equity firm Leonard Green & Partners LP for $1.6 billion, or $61 per share. Micron (MU 8.28) reported first quarter earnings of $0.15 per share, $0.13. Rovi Corp. is buying Sonic Solutions in a cash-and-stock deal valued at approximately $720 million in order to enhance its digital entertainment offerings. Bed Bath & Beyond climbed 6% in premarket trading. The housewares retailer posted a 25% increase in fiscal third-quarter earnings, beating its guidance and raising its expectations for the remainder of the year. The company's board also approved a new $2 billion share repurchase program, representing roughly 16% of its market value.
Micron Technology slipped 2.5% premarket. The memory-chip maker's fiscal first-quarter profit declined 24% on lower margins as softening personal-computer demand weighed and sales growth missed Wall Street's expectations.
WEDNESDAY: Shares of Office Depot Inc. (ODP) surged as much as 10% Wednesday as investors interpreted the office-supplies retailer's new change-of-control agreement could be in the offing. Shares were recently up 7.8% at $5.22 after earlier hitting a high of $5.34. General Electric climbed 0.8%, McDonald's added 0.6% and Alcoa rose 0.5%. Limiting the advance, Intel fell. 1.1%. Hewlett-Packard declined 0.8% . Walgreen jumped 7.6% after the drugstore operator posted a 19% increase in fiscal first-quarter earnings, with Chief Executive Greg Wasson citing cost controls and a slowing of new-store openings. The company posted higher prescription sales and said the front of the store saw "significant increases" due to improved merchandising. Nike shed 4.7%. Emerging middle-class consumers in countries from China to Brazil helped propel a 22% increase in the company's fiscal second-quarter earnings.
TUESDAY: In equity news, shares of Martek Biosciences soared 35% after the company has agreed to a $31.50 a share bid, or $1.09 billion, from Dutch-based life sciences and materials-science group Royal DSM. CONAGRA profit declined16%. the maker of Healthy Choice meals and Egg Beaters posts fiscal 2Q profit of $200.9 million, or 46c a share, hurt by rising commodities costs and tepid consumer responses to promotions in its consumer segment. Sales rise 2% to $3.16 billion. Google Inc. (GOOG) is in talks with much smaller rivals of the online coupon site Groupon, after the Internet search company's $6 billion buyout offer was spurned by Groupon earlier this month. Adobe Systems Inc. (ADBE) reported a fourth-quarter profit of $268.9 million, or 53 cents per share. Jabil Circuit Inc. (JBL) said that it earned a first-quarter profit of $106.7 million, or 49 cents per share, on revenue of $4.1 billion. On the earnings front, CarMax Inc. (KMX), ConAgra Foods Inc. (CAG), Hovnanian Enterprises Inc. (HOV), Nike Inc. (NKE), Red Hat Inc. (RHT), Tibco Software Inc. (TIBX), and Cintas Corp. (CTAS) are slated to release their quarterly reports.
MONDAY: Defense contractor Raytheon fell 0.5% after agreeing to pay about $490 million to buy intelligence and reconnaissance products company Applied Signal Technology, whose shares jumped 8%. Raytheon will pay $38 a share, an 8.5% premium to Applied Signal's Friday's closing price of $35.02. American Express declined 13 points 6% after analyst Stifel Nicolaus said the company is "more exposed" following last week's Federal Reserve proposals on debit-card interchange fees. .Jefferies fiscal 4Q preliminary profit falls 24% to $70.7 million, or 35c a share. Wells Fargo Securities hired six senior investment bankers, shares rose to $30.20. Wells Fargo & Co. (WFC) agreed to make an estimated $2.4 billion in mortgage modifications for California homeowners with "pick-a-payment" type adjustable-rate loans, as part of an agreement with the state's attorney general. The company said it is also paying $33 million to the state for customer outreach and to prevent or reduce the effects of foreclosures in California communities. Boeing share declined 3.1% in morning trading. Over the weekend the chief executive of Qatar Airways said the company could cancel orders for Boeing's 787 Dreamliner if there are further delays to its delivery. Boeing on Monday said it plans to boost production of a separate aircraft, the 777 airplane, starting in 2013.
AT&T shed 0.3% after the company said it will pay $1.93 billion for a swath of spectrum licenses from Qualcomm as AT&T looks to bolster its 4G service while Qualcomm said it plans to shut down its mobile broadcast video service. Shares of Qualcomm added 0.1%, while Verizon Communications rose 0.2%.
Medtronic rose 2.1% after the medical-device maker said William A. Hawkins, its chairman and chief executive, will retire in April, the end of the company's current fiscal year.
Sara Lee gained 1.5% after the company's talks on selling itself to Brazil's JBS have hit a snag over price. Adobe Systems rose 0.9% ahead of its fiscal fourth-quarter results after the close.
Brown-Forman, the maker of Jack Daniel's whiskey, is putting its wine business up for sale, according to people familiar with the matter.
Financials were a bright spot in Monday's trading. Bank of America was the Dow's top performer, rising 1%, while J.P. Morgan Chase gained 0.9%. In light of last week's takeover news, banks are "very well-positioned," McMahon said. "We're anticipating them starting to pay dividends or buybacks."
Fabric and craft supplies retailer Jo-Ann Stores has agreed to be acquired by private equity firm Leonard Green & Partners LP for $1.6 billion, or $61 per share. Micron (MU 8.28) reported first quarter earnings of $0.15 per share, $0.13. Rovi Corp. is buying Sonic Solutions in a cash-and-stock deal valued at approximately $720 million in order to enhance its digital entertainment offerings. Bed Bath & Beyond climbed 6% in premarket trading. The housewares retailer posted a 25% increase in fiscal third-quarter earnings, beating its guidance and raising its expectations for the remainder of the year. The company's board also approved a new $2 billion share repurchase program, representing roughly 16% of its market value.
Micron Technology slipped 2.5% premarket. The memory-chip maker's fiscal first-quarter profit declined 24% on lower margins as softening personal-computer demand weighed and sales growth missed Wall Street's expectations.
WEDNESDAY: Shares of Office Depot Inc. (ODP) surged as much as 10% Wednesday as investors interpreted the office-supplies retailer's new change-of-control agreement could be in the offing. Shares were recently up 7.8% at $5.22 after earlier hitting a high of $5.34. General Electric climbed 0.8%, McDonald's added 0.6% and Alcoa rose 0.5%. Limiting the advance, Intel fell. 1.1%. Hewlett-Packard declined 0.8% . Walgreen jumped 7.6% after the drugstore operator posted a 19% increase in fiscal first-quarter earnings, with Chief Executive Greg Wasson citing cost controls and a slowing of new-store openings. The company posted higher prescription sales and said the front of the store saw "significant increases" due to improved merchandising. Nike shed 4.7%. Emerging middle-class consumers in countries from China to Brazil helped propel a 22% increase in the company's fiscal second-quarter earnings.
TUESDAY: In equity news, shares of Martek Biosciences soared 35% after the company has agreed to a $31.50 a share bid, or $1.09 billion, from Dutch-based life sciences and materials-science group Royal DSM. CONAGRA profit declined16%. the maker of Healthy Choice meals and Egg Beaters posts fiscal 2Q profit of $200.9 million, or 46c a share, hurt by rising commodities costs and tepid consumer responses to promotions in its consumer segment. Sales rise 2% to $3.16 billion. Google Inc. (GOOG) is in talks with much smaller rivals of the online coupon site Groupon, after the Internet search company's $6 billion buyout offer was spurned by Groupon earlier this month. Adobe Systems Inc. (ADBE) reported a fourth-quarter profit of $268.9 million, or 53 cents per share. Jabil Circuit Inc. (JBL) said that it earned a first-quarter profit of $106.7 million, or 49 cents per share, on revenue of $4.1 billion. On the earnings front, CarMax Inc. (KMX), ConAgra Foods Inc. (CAG), Hovnanian Enterprises Inc. (HOV), Nike Inc. (NKE), Red Hat Inc. (RHT), Tibco Software Inc. (TIBX), and Cintas Corp. (CTAS) are slated to release their quarterly reports.
MONDAY: Defense contractor Raytheon fell 0.5% after agreeing to pay about $490 million to buy intelligence and reconnaissance products company Applied Signal Technology, whose shares jumped 8%. Raytheon will pay $38 a share, an 8.5% premium to Applied Signal's Friday's closing price of $35.02. American Express declined 13 points 6% after analyst Stifel Nicolaus said the company is "more exposed" following last week's Federal Reserve proposals on debit-card interchange fees. .Jefferies fiscal 4Q preliminary profit falls 24% to $70.7 million, or 35c a share. Wells Fargo Securities hired six senior investment bankers, shares rose to $30.20. Wells Fargo & Co. (WFC) agreed to make an estimated $2.4 billion in mortgage modifications for California homeowners with "pick-a-payment" type adjustable-rate loans, as part of an agreement with the state's attorney general. The company said it is also paying $33 million to the state for customer outreach and to prevent or reduce the effects of foreclosures in California communities. Boeing share declined 3.1% in morning trading. Over the weekend the chief executive of Qatar Airways said the company could cancel orders for Boeing's 787 Dreamliner if there are further delays to its delivery. Boeing on Monday said it plans to boost production of a separate aircraft, the 777 airplane, starting in 2013.
AT&T shed 0.3% after the company said it will pay $1.93 billion for a swath of spectrum licenses from Qualcomm as AT&T looks to bolster its 4G service while Qualcomm said it plans to shut down its mobile broadcast video service. Shares of Qualcomm added 0.1%, while Verizon Communications rose 0.2%.
Medtronic rose 2.1% after the medical-device maker said William A. Hawkins, its chairman and chief executive, will retire in April, the end of the company's current fiscal year.
Sara Lee gained 1.5% after the company's talks on selling itself to Brazil's JBS have hit a snag over price. Adobe Systems rose 0.9% ahead of its fiscal fourth-quarter results after the close.
Brown-Forman, the maker of Jack Daniel's whiskey, is putting its wine business up for sale, according to people familiar with the matter.
Financials were a bright spot in Monday's trading. Bank of America was the Dow's top performer, rising 1%, while J.P. Morgan Chase gained 0.9%. In light of last week's takeover news, banks are "very well-positioned," McMahon said. "We're anticipating them starting to pay dividends or buybacks."
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Canadian Market:
The Toronto Stock Exchange and the TSX Venture Markets will close at 1:00 p.m. on Friday, December 24, 2010 for the Christmas holiday.
TORONTO STOCKS EDGE UP FRIDAY
Toronto stocks edged up in low volume trading, during a shortened session Friday. By noon Friday the TSX index was up 20.75 points to 13,391.95. Energy equities led the index higher. The S&P/TSX opened at 13,371.03, down 0.17 of a point. The Canadian dollar opened on Friday at 99.43 cents US, up 0.31 of a cent. By 10:00 a.m. EST the loonie was up 0.24 of a cent to 99.36 cents US. Gold was quoted at C$1,392 bid (US$1,384) and C$1,393 asked (US$1,385) in mid-morning trading Friday at Travelex Canada Ltd., a major gold and foreign exchange dealer.
The Toronto stock market was mostly flat Friday on very low volume with New York stock and commodity markets closed as American traders get an early start on the Christmas holiday.
The S&P/TSX composite index inched up 0.48 of a point to 13,371.68 points to while the TSX Venture Exchange rose 2.8 points to 2,178.16.
The Canadian dollar moved higher against the greenback, up 0.08 of a cent to 99.2 cents US.
Consumer discretionary stocks led advancers with Quebecor Inc. (TSX:QBR.B) ahead 48 cents to $38.05.
Energy stocks were also positive with Canadian Natural Resources (TSX:CNQ) up 14 cents to $44.74.
Metal stocks were weak with Lundin Mining (TSX:LUN) down five cents to $7.05.
The TSX is headed for a positive end to the second last trading week of the year, up about 170 points or 1.28 per cent. The exchange's main index is set to close out 2010 trading up more than 13 per cent, led by strong gains in mining stocks amid growing demand from China and other emerging markets.
In equity news Friday:
Western Financial Shares Move
Higher on Takeover News
Shares in Western Financial Group (TSX:WES), the largest insurance and financial services retailer in Western Canada, rose more than 66 per cent in early Friday trading, a day after a friendly takeover bid by Quebec-based Desjardins Financial Group.
The financial group announced Thursday it was making an all-cash offer of $443 million or $4.15 per share for Western, in a bid to increase its influence outside of Quebec. Quebec-based Desjardin Financial Group is trying to buy Western Financial Group (TSX:WES) in a bid to increase its influence in Western Canada. Western Financial shares surged $1.65 to $4.10.
Western's board of directors is recommending that shareholders accept the offer. Shares of Western rose $1.63 to $4.08 in heavy trading by 11:15 a.m. EST, 2,983,304 shares had been traded up 1.64%. Western Financial Group Inc. (WES.T, C$2.45, C$0.01, 0.4%) has agreed to be acquired by Quebec-based Desjardins Financial Group in a cash transaction worth C$443 million or C$4.15 a share.
The financial group announced Thursday it was making an all-cash offer of $443 million or $4.15 per share for Western, in a bid to increase its influence outside of Quebec. Quebec-based Desjardin Financial Group is trying to buy Western Financial Group (TSX:WES) in a bid to increase its influence in Western Canada. Western Financial shares surged $1.65 to $4.10.
Western's board of directors is recommending that shareholders accept the offer. Shares of Western rose $1.63 to $4.08 in heavy trading by 11:15 a.m. EST, 2,983,304 shares had been traded up 1.64%. Western Financial Group Inc. (WES.T, C$2.45, C$0.01, 0.4%) has agreed to be acquired by Quebec-based Desjardins Financial Group in a cash transaction worth C$443 million or C$4.15 a share.
Maple Leaf Foods Inc. (MFI.T, C$11.37, -C$0.07, -0.6%) said that, at its annual meeting on April 28, shareholders will be asked to vote on five non-binding resolutions put forward by hedge fund West Face Capital, which owns about 11.4% of Maple Leaf's shares.
Canada Bond yields and prime rates for Friday, Dec. 24, 2010
Canada Bond yields (previous day in brackets):
Two-year: 1.69% (1.69)
Five-year: 2.45% (2.46)
10-year: 3.17% (3.18)
30-year: 3.56% (3.57)
Interest rates:
Prime rate: 3.00%
Overnight lending rate: 1.00%
THURSDAY:
Canada's International Reserves
Up $401M In December 2010
Canada's official international reserves rose $401 million in the week ended Dec. 23, the Bank of Canada reported. The official international reserves totaled $56.638 billion, up from $56.237 billion at Dec. 15.
The Dec. 23 reserves included:
U.S. dollars, $26.632 billion; other foreign currencies, $17.829 billion; gold, $150 million; special drawing rights, $8.992 billion; reserve position in the International Monetary Fund, $3.035 billion. All reserve figures are reported in U.S. funds.
TORONTO EDGES LOWER THURSDAY
Toronto stocks ended mixed Thursday, as modest gains in the energy and materials sectors were offset by equally modest losses in just about every other sub-group on a light trading day ahead of the holiday season.
The S&P/TSX Composite Index fell 9.50 points, or 0.07%, to 13371.20. However, advances led declines 909 to 737. Trading volume was 346.50 million shares, down from Wednesday's total of 432.50 million shares. The S&P/TSX 60 Index closed down less than a point to end at 763.87.
The biggest story of the day came out of Ventana Gold, which advised shareholders to reject an unsolicited C$12.63-a-share bid from Brazil's EBX Group. Ventana said the bid was inadequate and that it has signed "a number" of confidentiality agreements with potentially interested bidders as it "aggressively" pursues alternatives to the EBX Group bid. Ventana closed up 23 Canadian cents to C$13.28. Toronto indexes were modestly lower most of the day Thursday's upward movement was led by materials. The S&P/TSX Composite index was at 13,392.76, higher by 12. points. Earlier today the Canadian October Gross Domestic Product rose 0.2%, but was slower than analysts had expected .
AECO drop unchanged at C$3.55/GJ
Canadian spot gas flat despite big storage draws
Canadian spot natural gas prices were little changed on Thursday as hefty storage withdrawal numbers were offset by ample short-term supplies and moderate weather.
Canadian inventories fell last week by 6.8 percent to 538.8 bcf, Canadian Enerdata said. Facilities across the country were 77.3 percent full on average, versus 81.7 percent 12 months earlier.
Spot gas at the AECO storage hub in southeastern Alberta averaged C$3.55 a gigajoule, unchanged from Wednesday. Deals were done between C$3.51 and C$3.58 a GJ.
TORONTO HIGHER WEDNESDAY
Toronto stocks ended modestly higher Wednesday, as gains in the energy sector offset losses in the materials group.
An increase in the price of oil, which closed above US$90 a barrel for the first time in more than two years, helped lift energy stocks. Crude closed up 66 U.S. cents to end at US$90.48 a barrel in New York.
In corporate news, Sunoco Inc. (SUN) said Wednesday it will buy 25 retail gas stations in New York state from Leigh Gas Corporation for an undisclosed amount, furthering the company's reach into northeastern U.S. markets.
Sunoco, which earlier this month sold its Toledo refinery to PBF Holdings Co. LLC, has pledged to increase its retail business while it shrinks its refining footprint. Falling U.S. gasoline demand has left refiners looking for ways to cut back on production capacity and make money in other ways.
The energy group ended up 1.07%, with Suncor rising 0.82 to 38.34 and Canadian Natural Resources climbing 0.52 to 44.38.
The financial services group rose 0.53%, with Royal Bank of Canada ending up 0.21 to 52.03, Canadian Imperial Bank of Commerce climbing 0.50 to 79.65 and Toronto-Dominion Bank gaining 0.54 to 73.70. The telecom group gained 0.66%, with BCE rising 0.79 to 35.96 and Telus ending up 0.19 to 46.75.
The materials group fell 1.19%, with Barrick Gold giving up 0.65 to 51.97 and Agnico-Eagle Mines ending down 1.52 to 76.35. The industrials group shed 0.25%, with Canadian National Railway dropping 0.62 to 67.26.
Dalsa surged C$3.69 to C$18.19 after the company said it agreed to be acquired by Teledyne Technologies for C$18.25 a share. The cash offer is worth about C$341 million.
Wi-LAN jumped 0.50 to 4.83 after announcing it settled its patent-infringement dispute with LG Electronics. Terms of the deal weren't disclosed. The announcement could be the first of a number of settlements as Wi-LAN's patent-infringement disputes with several U.S. technology bellwethers, including Apple, Intel, Dell and Hewlett-Packard, nears trial.
The S&P/TSX Composite Index rose 15.55 points, or 0.12%, to 13380.70 Advances led declines 874 to 745. Trading volume was 432.50 million shares, up from Tuesday's total of 408.10 million shares. The S&P/TSX 60 Index closed up 1.99, or 0.26%, to 764.66 points.
The TSX Venture Exchange stood at 2,163.33, up 7.50 points at noon on Wednesday. Toronto energy equities drove led the index higher Wednesday driving the S&P/TSX Composite to 13389.98 up 24.83 points.
TORONTO STOCKS HIGHER TUESDAY
The Toronto stock market closed sharply higher Tuesday as another major acquisition in the Canadian financial sector raised hopes for a strong economic rebound and more such dealmaking. The S&P/TSX composite index jumped 171.87 points to 13,365.15, while the TSX Venture Exchange was up 8.68 points at 2,155.83.
Toronto indexes were up Tuesday led by materials, financials, and energy. The Canadian dollar ended slightly lower Tuesday as soft inflation data and a stronger-than-expected retail sales report tended to offset each other in light trading flows. The U.S. dollar was at C$1.0183 at 3:04 p.m. EST (2004 GMT) Tuesday, from C$1.0192 at 8:00 a.m. EST (1300 GMT)
By 2:00 p.m. EST the S&P/TSX Composite was 13324.09, up 130.81 points or 1.0% from Monday. TSX Venture Exchange stood at 2,146.88, down 0.27 of a point at noon on Tuesday.
Loonie falters amid low inflation. The Canadian dollar lost ground Tuesday as the greenback gained against other currencies.The loonie was down 0.15 of a cent at 98.24 cents US. The Canadian dollar opened on Tuesday at 98.04 cents US, down 0.35 of a cent.
The dollar also declined amid data showing that inflation remains very tame in Canada. Statistics Canada reported that Canada’s annual inflation rate rose to an annualized rate of two per cent in November, down from 2.4 per cent in October. Analysts said the lower inflation figure indicates the Bank of Canada will be in no hurry to raise interest rates before mid-2011.
Canadian Retail Sales Rose
For Fifth Straight Month
Statistics Canada says this fifth-straight monthly increase was pushed by a 7.4-per-cent increase in gas station sales. Higher gasoline prices drove overall retail sales up 0.8 per cent to $36.6 billion in October.
Sales rose in seven of the 11 areas monitored, but with gas stations excluded, overall sales actually slipped 0.1 per cent. Business was up at furniture and home furnishing stores, which recorded a 2.2-per-cent increase.Sales of motor vehicles and parts rose 0.3 per cent, a fifth consecutive monthly increase. New car sales were flat.
Miscellaneous store retailers, including office supply and stationery stores, reported a 1.4-per-cent increase in business.Jewellery, luggage and leather goods stores reported a 2.0-per-cent sales increase. Sales at general merchandise stores, which include department stores, slipped 1.2 per cent. Sales were also off at food and beverage stores, supermarkets and among clothing and clothing accessory retailers.
Toronto indexes were up Tuesday led by materials, financials, and energy. The Canadian dollar ended slightly lower Tuesday as soft inflation data and a stronger-than-expected retail sales report tended to offset each other in light trading flows. The U.S. dollar was at C$1.0183 at 3:04 p.m. EST (2004 GMT) Tuesday, from C$1.0192 at 8:00 a.m. EST (1300 GMT)
By 2:00 p.m. EST the S&P/TSX Composite was 13324.09, up 130.81 points or 1.0% from Monday. TSX Venture Exchange stood at 2,146.88, down 0.27 of a point at noon on Tuesday.
Loonie falters amid low inflation. The Canadian dollar lost ground Tuesday as the greenback gained against other currencies.The loonie was down 0.15 of a cent at 98.24 cents US. The Canadian dollar opened on Tuesday at 98.04 cents US, down 0.35 of a cent.
The dollar also declined amid data showing that inflation remains very tame in Canada. Statistics Canada reported that Canada’s annual inflation rate rose to an annualized rate of two per cent in November, down from 2.4 per cent in October. Analysts said the lower inflation figure indicates the Bank of Canada will be in no hurry to raise interest rates before mid-2011.
Canadian Retail Sales Rose
For Fifth Straight Month
Statistics Canada says this fifth-straight monthly increase was pushed by a 7.4-per-cent increase in gas station sales. Higher gasoline prices drove overall retail sales up 0.8 per cent to $36.6 billion in October.
Sales rose in seven of the 11 areas monitored, but with gas stations excluded, overall sales actually slipped 0.1 per cent. Business was up at furniture and home furnishing stores, which recorded a 2.2-per-cent increase.Sales of motor vehicles and parts rose 0.3 per cent, a fifth consecutive monthly increase. New car sales were flat.
Miscellaneous store retailers, including office supply and stationery stores, reported a 1.4-per-cent increase in business.Jewellery, luggage and leather goods stores reported a 2.0-per-cent sales increase. Sales at general merchandise stores, which include department stores, slipped 1.2 per cent. Sales were also off at food and beverage stores, supermarkets and among clothing and clothing accessory retailers.
TD BANK TO PAY $6.3B FOR CHRYSLER FINANCIAL
Toronto-Dominion Bank, Canada's second-largest bank in assets, confirms it will buy Chrysler Financial Corp., the auto lender owned by Cerberus Capital Management, for about $6.3 billion to expand its reach in the U.S. market.
IVANHOE ENERGY- MAJOR CHINA GAS FIND
Calgary-based oil and gas company's China-focused unit makes a 'significant' natural gas discovery at its Yixin-2 well in southwest China, triggering a 24% jump in Ivanhoe's shares in pre-market trading.
Tuesday's Market Note
On Tuesday, two key domestic data points will be released.
Consumer price data for November will be released at 7:00 a.m. EST (1200 GMT). Economists expect that core inflation was at 1.6% on an annualized basis in November, dropping from 1.8% in the previous month. They expect all-items inflation to come in at 2.2% from 2.4% in October.
Retail sales data for October will be reported at 8:30 a.m. EST (1330 GMT). Economists expect that retail sales grew by 0.5% in October after a 0.6% climb in September.
Canadian Shares Mixed to Lower Monday
Toronto stocks closed flat Monday, as gains in commodities sectors were offset by modest declines across all other sectors on the S&P/TSX Composite Index which finished down 8 points.
The biggest corporate news stories Monday came out of Talisman Energy and CAE, a maker of full-flight simulators. Talisman agreed to sell a 50% stake in its Farrell Creek shale assets to Sasol for C$1.05 billion, while CAE agreed to buy CHC Helicopter's flight training operations for an undisclosed amount. CAE closed up 17 Canadian cents to C$11.41, while Talisman rose 1.00 to 21.89.
The TSX's key equity index fell 8.18 points, or 0.06%, to 13193.28. Advances led declines 982 to 656. Trading volume was 425.30 million shares, down from Friday's total of 741.3 million shares. The S&P/TSX 60 Index closed down 2.19, or 0.29%, to 752.03 points.
Canadian bonds ended mostly higher Monday with modest gains in most maturities in subdued and somewhat directionless trading in advance of the Christmas holiday season.
Canada's two-year bond yield was at 1.613% late Monday, from 1.605% late Friday. The 10-year bond yield was at 3.167%, from 3.170%. Bond yields and prices move in opposite directions.
The stock market was trading slightly higher at midday Monday lead by materials and energy sectors on thin volume, as many investors begin booking off for the holiday season.
The main news maker of the day was Talisman Energy, which announced an agreement to sell a 50% stake in its Farrell Creeek shale assets to Sasol for C$1.05 billion. Talisman was up 77 Canadian cents to C$21.66.
At 11:45 a.m. EST (1645 GMT), the S&P/TSX Composite Index was up 21.12 points, or 0.16%, at 13222.58. Advances led declines 806 to 625. Trading volume was 195.60 million shares. The S&P/TSX 60 Index was down less than a point at 754.17 points. Toronto stocks closed higher Friday, for the first time in four days.
Toronto Indexes, Friday; Noon EST Composite Up 20.75
S&P/TSX Composite 13391.95 up 20.75 or 0.2%
S&P/TSX 60 Index 765.05 up 1.18 or 0.2%
Financials 183.88 up 0.45 or 0.2%
Materials 434.99 off 0.14 or 0.0%
Energy 324.69 up 1.01 or 0.3%
Industrials 110.20 up 0.12 or 0.1%
IT 31.24 up 0.17 or 0.5%
Volume Friday Thursday
11-12 20.6M 48.9M
9:30-12 75.7M 173.2M
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South American Markets:
BRAZIL:
Brazil Stocks End Higher Thursday
Brazilian stocks closed marginally higher Thursday after wading in negative territory for most of the day. Banking shares gained on announcement of Brazil's strong credit performance, and oil giant Petroleo Brasileiro SA (PBR, PETR4.BR), or Petrobras, rose on higher oil prices.
The Ibovespa stocks index ended at 68485 points, just 0.02% higher than Wednesday's close of 68471 points. Volumes were thin on the last day of trading before the Christmas holiday break.
Brazil's stocks shrugged off some of the uncertainties that had dogged global markets for much of the day on disappointing U.S. economic indicators and negative signals from Europe.
Brazilian domestic news was brighter. The Central Bank announced strong bank lending figures, reflecting vigorous economic growth. Total loans rose for the 12th straight month to 1.68 trillion reais ($988 billion) in November, up nearly 21% from a year earlier, the bank said. Credit now equals 46.3% of gross domestic product, up from 45.9% in October, it said.
Despite the inflationary risk from high credit levels that led the central bank earlier this month to rein in credit by raising bank reserve requirements, bank shares surged on the new figures.
Banco do Brasil (BDORY, BBAS3.BR) rose 1.24% to 31.04 Brazilian reais ($18.37) while Banco Santander (BSBR, SANB4.BR) gained 1.11% to BRL21.98.
Petrobras gained 0.18% to BRL28.54 after oil futures prices continued a rising streak on international markets, reaching $91.63, a barrel for February contracts, their highest since February 2008.
Brazilian airlines Gol Linhas Aereas Inteligentes SA (GOL, GOLL4.BR) was the Bovespa exchange's second-biggest gainer after a planned airline workers' strike which had threatened to paralyze Brazilian air transport over the holiday weekend was averted early Thursday by a court ruling.
Gol gained 2.41% to BRL25.10, reversing Wednesday's losses. Rival TAM SA (TAM, TAMM4.BR), which had risen strongly earlier in the day, ended up slipping back 0.05% to BRL40.46 as it became apparent that the threatened strike may simply be postponed until January.
Miner Vale SA (VALE, VALE5.BR) closed down 0.40% at BRL50.05 after metals prices slipped back on international markets in thin trading in the run-up to the Christmas holiday break.
Brazil Consumer Confidence Index Drops 2.1%
Brazil's main consumer confidence index decreased in December, ending a nine-month stretch of increases, but remains at a high level which suggests demand is likely to remain strong.
The Consumer Confidence Index, or ICC, dropped 2.1% to 125.1 points in December. The index runs from 1 to 200 points, with 100 considered neutral, the Getulio Vargas Foundation, or FGV, said Wednesday.
Despite the fall, the figure remains well above the historical average of 107 points.
The survey shows that consumer confidence "stabilized at high levels, declining a bit in December after reaching successive record-highs month after month," said Goldman Sachs in a research report for its clients. Private consumption should "sustain a strong expansion in coming quarters," so the government should move to raise interest rates, rein in spending and slow borrowing, the bank said.
Earlier Wednesday, the central bank said it may need to raise the benchmark Selic interest rate in the short term to stave off growing pressures on inflation.
Brazil's economy has proved resilient in the face of the global economic crisis, and the country's gross domestic product is expected to expand more than 7% this year and more than 4% next year.
Earlier Wednesday, the central bank raised its forecast for the IPCA consumer price index to 5.9% in its latest quarterly inflation report from 5.0% in September. For 2011, the figure was increased to 5% from 4.6%. With the rise in inflation forecasts, economist now see the Selic rate, currently at 10.75%, reaching 12.25% by the end of 2011.
The ICC index is based on interviews with 2,000 families in Brazil's seven largest cities. The ICC measures the willingness of families to make purchases of various types of consumer goods and gauges expectations about employment, income and economic opportunities.
Brazilian Banks Cut Credit
Expansion View For 2011
Brazilian banks revised downward their estimates for the expansion of credit portfolios next year after the government adopted measures to restrict credits. The downward revision came after the government adopted measures to restrict credit in order to control inflation pressures.
Brazilian banks are expecting an expansion of credit portfolios by 17.8% in 2011, according to a survey by the national banks federation, known as Febraban, with more than 30 financial institutions. The decisions will remove some 61 billion Brazilian reais ($35.88 billion) from the financial system while discouraging long-term installment buying by consumers.
In the previous survey, published in November, local banks were expecting a credit portfolio expansion by 18.5% next year. By comparison, for this year credit expansion is expected to reach 20.3%, according to the survey.
Earlier this month, the central bank announced it was raising reserve requirements on term deposits to 20% from 15% and on cash deposits to 12% from 8%. The bank also raised capital requirements on long-term loans to individual consumers to 150% from 100%.
Economists expect inflation to end the year above target, at 5.88%, although that's within the two-percentage-point band on either side of the target that the government allows. Local banks maintained their view for the nonperforming loan rate, expected to reach 4.6% next year compared with 4.7% this year.
Brazil's Currency Moves Up
Brazil's currency appreciated after economists raised their 2010 and 2011 year-end average inflation forecasts, according to the Central Bank of Brazil's market survey published Monday. The Brazilian real closed stronger on Monday as economists boosted inflation expectations, heightening speculation the central bank will raise one of the world's highest interest rates even higher. The real closed at BRL1.7065 to the dollar, stronger than Friday's close of BRL1.7112.
The weekly survey placed the 2010 year-end forecast for the IPCA inflation rate at 5.88%, up from 5.85% a week earlier. Tombini's nomination to head the central bank starting next year was approved by Brazil's Senate last week. President-elect Dilma Rousseff, who nominated Tombini, has pushed for lower rates, prices of food, rent and basic services are rising faster than forecast. Many Brazilian economists expect the country to boost its 10.75% interest rate in the beginning of next year.
MEXICO
The Mexican market closes early, at 1 p.m. EST.
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Mexico's Stocks Flat In Early Trading Friday
.Mexican stocks opened flat in thin Christmas Eve trading on Friday, with few players in the game as U.S. markets were closed for the holiday.
The IPC index of the 35 most-traded stocks was lower by 41 points, or 0.1% at about 10:30 a.m. EST. Volume was 1 million shares worth 140.6 million pesos ($11.4 million).
The Vector brokerage said in a research note that given the closure of markets in some European nations as well, and no economic news expected, the session is likely to be "apathetic and with little volume."
Santander Mexico signs deal to buy GE's consumer mortgage business in Mexico
Among stocks trading early in the session, Mexico's largest retailer Wal-Mart de Mexico (WMMVY, WALMEX.MX) V shares were off 0.7% to MXN35.31 and brewer Grupo Modelo (GMODELO.MX) C shares were down 0.7% to MXN73.22.
Latin America's biggest wireless provider America Movil (AMX, AMX.MX) L shares slipped 0.2% to MXN34.96, and chemical maker Mexichem (MEXCHEM.MX) shares were ahead 0.2% to MXN43.20.
The IPC set a record high earlier in the week. The peso was slightly stronger against the dollar, quoted in Mexico City at MXN12.3310, according to Infosel, compared with MXN12.3450 at the close Thursday.
Mexico Microfinance Bank Compartamos Completes Share Exchange
Mexican microfinance bank Banco Compartamos said Friday it has completed an exchange offer to switch its shares into holding company Compartamos (COMPARC.MX).
Compartamos said the total capital stock acquired by the holding company reached 97.24%, which was above the 95% it needed to delist the bank--Banco Compartamos--from the Mexican Stock Exchange. The new Compartamos shares were rising 0.9% to 26.48 pesos ($2.15) around 11:45 a.m. EST.
When the bank announced its exchange offer in mid-November, it said the switchover would give it greater flexibility to expand into other markets, both in Mexico and abroad. The management of the bank will be essentially unchanged by the transaction, it said.
Compartamos is the largest of Mexico's microfinance banks, which make small loans to people and businesses with little access to traditional bank credit.
THURSDAY:
Mexico's Stocks Close Lower Thursday
Mexican stocks closed 0.1% lower Thursday in light pre-Christmas trading. The IPC index of the 35 most-traded issues ended 41 points lower at 38131. Volume was 81.6 million shares worth 2.6 billion pesos ($212 million).
The IPC traded lower during most of the session but mounted a short-lived comeback in the final minutes as investors took positions going into the long weekend in the U.S., where markets are closed Friday. Mexico's stock market will open for a half-day on Christmas Eve, closing at noon local time (1 p.m. EST).
Among IPC blue chips, cement and construction materials company Cemex (CX, CEMEX.MX) CPO shares lost 0.5% to MXN13.12. The stock has crept steadily upward since mid-October as the global giant gears up for a possible recovery in the U.S. construction sector.
Retailer Comercial Mexicana (COMERCI.MX) UBC shares fell 1.1% to MXN14.17. The stock had risen 3.1% in the previous session as the company's debt restructuring, which had already been approved in Mexico, received the green light from a U.S. court.
Mexico's biggest broadcaster Televisa (TLEVISA) CPO shares dropped 1.4% to MXN64.16. The company's stock price has been rising steadily since it announced a deal to take a 35% stake in U.S. Spanish-language broadcaster Univision in early October, and the issue reached a 12-month high at Wednesday's close.
Mexico's Stocks Open Lower
Mexican stocks fell in early trading Wednesday after their record close a day earlier, as revised U.S. economic growth data came in lower than expected. The IPC index of the 35 most-traded stocks was down 0.2% to 38,151 points at about 10:25 a.m. EST on volume of 11.3 million shares worth 297.2 million pesos ($24.2 million).
Revised U.S. third-quarter gross domestic product expanded 2.6%, missing economists' expectation of 2.9%. Mexico sends 80% of its exports to the U.S., which has been driving recovery in Mexican industries like manufacturing.
Mexico's exports rose a solid 26% in November to $28.15 billion, the National Statistics Institute reported.
The IPC was also coming off a record close set on Tuesday, as a pre-Christmas rally pushed it to close above the 38,000-point barrier for the first time ever on general economic optimism.
Wireless provider America Movil (AMX, AMX.MX) L shares were losing 0.5% to MXN35.00. The cellular giant is the most heavily weighted stock in the IPC. Mexico's biggest retailer Wal-Mart de Mexico (WMMVY, WALMEX.MX) V shares fell 0.5% to MXN35.74.
Cement and materials giant Cemex (CX, CEMEX.MX) CPO shares were slipping 0.3% to MXN13.32 after closing higher by 4.6% on Tuesday. Bread maker Bimbo (BIMBO.MX) A shares were rising 0.7% to MXN106.
The Mexican peso was gaining ground against the U.S. dollar and was quoted by Infosel at MXN12.3510 versus Tuesday's close of MXN12.3755.
Mexico November Unemployment Slips To 5.3%
Mexico's unemployment rate fell in November from previous months as employers ramped up hiring on expectations of a seasonal pickup in economic activity, though the rate remained similar to a year ago.
The jobless rate slipped to 5.3% of the workforce last month from 5.7% in October and September, the National Statistics Institute, or Inegi, said Wednesday. November 2009 also registered an unemployment rate of 5.3%.
Underemployment, or the percentage of employed workers who needed work and were available to work more hours than they did, fell sharply to 7.1% last month from 8.5% in October and 8.7% in November 2009, Inegi said.
Joblessness in Mexico typically declines in the final two months of the year as holiday shoppers breathe life into the economy.
Mexico's economic recovery this year has brought mixed results for the job market. While the number of formal, private-sector workers registered with the Mexican Institute of Social Security, or IMSS, has reached historic highs, unemployment levels according to Inegi's monthly surveys remain well above the 3%-4% levels typical before last year's crisis.
Eclac, the United Nations agency that monitors Latin American economies, estimated this month that Mexico's average wages will fall 0.6% this year, in real terms, from 2009...
Mexico's Stocks Rise Tuesday
Mexico's Stocks Close At Record High; IPC Index Up 0.7%
Mexican stocks rallied to a new record high at Tuesday's close on U.S. market gains and general optimism going into the new year that a recovery could be in store for both nations' closely linked economies.
The IPC index of the 35 most-traded stocks rose 0.7% and closed above the 38,000-point barrier for the first time to settle at 38,231. Volume was a healthy 220.7 million shares worth $6.76 billion pesos ($546 million).
Leading the IPC rally was cement and construction materials giant Cemex (CX, CEMEX.MX), whose CPO shares rose 4.6% to MXN13.37. The firm was one of the most likely to benefit from renewed U.S. economic growth after getting its financial house in order over the last year, said Sotomayor, who added that the stock price was nearing Actinver's target of MXN13.80.
Mexico's biggest retailer Wal-Mart de Mexico (WMMVY, WALMEX.MX) V shares rose 0.9% to MXN35.64, and top broadcaster Televisa (TV, TLEVISA.MX) CPO shares rose 1.8% to MXN64.74. Copper miner and railways operator Grupo Mexico (GMEXICO.MX) B shares rose 0.9% to MXN48.30 as copper prices hit a record on demand from China and reduced supply due to the closure of a Chilean copper mine.
The Mexican peso gained ground against the U.S. dollar to close at MXN12.3755, according to Infosel, versus Monday's close of MXN12.4010.
Mexican stocks rose in early trading Tuesday. The IPC index of the 35 most-traded stocks was 0.5% higher at about 10:45 a.m. EST to 38,163 on volume of 22.5 million shares worth 544.5 million pesos ($44 million).
Mexico's Stocks Higher Monday
Mexican stocks were flat in early trading Monday as the peso was losing ground against the U.S. dollar, quoted in Mexico City at MXN12.4255 versus Friday's close of MXN12.4125. The stock index remained near record levels going into Christmas week.
The IPC index of the 35 most-traded stocks was down 0.04% at 37,983 points around 10:50 a.m. EST. Volume was 24.2 million shares worth 665.4 million pesos ($53.5 million)
Bellwether America Movil (AMX) L shares were down 0.1% at MXN35.14.
Mexico's largest broadcaster Grupo Televisa (TV, TLEVISA.MX) CPO shares rose 1.3% to MXN63.47. The media conglomerate said Monday it had closed a deal reached earlier to take a 35% stake in U.S. Spanish-language broadcaster Univision in a $1.2 billion transaction.
Cement company Cemex (CX, CEMEX.MX) CPO shares rose 1% to MXN12.67, while copper miner and railways operator Grupo Mexico (GMEXICO.MX) B shares fell 0.3% to MXN47.87.
Chemical maker Mexichem (MEXCHEM.MX) shares increased 0.7% to MXN43.50. The company recently announced it had signed an agreement to acquire Massachusetts-based AlphaGary plastics group from Rockwood Holdings Inc. (ROC) as part of Mexichem's expansion plans.
Mexico's October Retail Sales Up 4.4%
Retail sales in Mexico picked up pace in October from the previous month as Mexicans increased their purchases of clothing, cars and other goods, the National Statistics Institute, or Inegi, said Monday.
Inegi said retail sales rose 4.4% from October 2009, and were up 0.67% from September in seasonally adjusted terms. The increase from the year-ago month was bigger than September's 4.1% rise.. Inegi said sales of garments, home appliances, food and beverages, and cars all rose from October 2009, while sales of health-care goods, stationery, and other goods for personal use were lower.
Domestic demand has been advancing more slowly than export-oriented industrial production as Mexico recovered this year from the 2008-2009 recession. Retail sales in the first 10 months were up 2.4% from the like period of 2009, well below the 5.8% growth rate for gross domestic product in the first three quarters of the year.
MEXICO PIPELINE EXPLOSION KILLS 28
The chief executive of Mexico's state-owned oil company Petroleos Mexicanos said fuel thieves were the most likely cause of an early morning pipeline blast.
ARGENTINA:
ARGENTINA STOCKS CLOSE HIGHER THURSDAY
Argentina Stocks Hold At Record High; Bonds Up On Swap Offer
Argentine stocks closed virtually unchanged Thursday from the record set a day earlier, while bonds ended the week on a positive note in moderate buying after the government re-opened a debt swap for defaulted bonds.
The Merval index of leading shares ended the day at 3,476.42 points, up less than two-tenths of a point from Wednesday and bringing the gain for the week to just over 2% and for the year to almost 50%. Markets will be closed Friday ahead of the Christmas weekend.
One of the biggest gainers Thursday was electricity transmission company Transener (TRAN.BA), which surged 9.5% to 1.61 Argentine pesos ($0.40) amid speculation that the government may soon ease up on residential power rates, said Besfamille brokerage trader Diego Zavaleta.
Shares of Argentine oil and gas firm YPF SA (YPF, YPFD.BA), a unit of Spanish energy group Repsol YPF SA (REP, REP.MC), soared 11.1% to close at ARS205.
Earlier in the day, Repsol YPF said it will sell another 3.3% stake in YPF SA to private-equity firm Eton Park Capital Management for $500 million.
Repsol, which took over the Argentine company in 1999, will still hold a 79.84% stake in the group, with the Peterson Group owning 15.46% and 4.69% freely floating shares. Repsol said the move is part of its strategy to rebalance its global asset portfolio. YPF said Thursday that it has been awarded a $250 million loan from the Andean Development Corporation, or CAF, to partially fund its oil and gas production, refining and sales investment plans.
The sale and loan comes on the heels of a major gas find by YPF in Argentina. Earlier this month, YPF said it had found an estimated 4.5 trillion cubic feet of unconventional gas after drilling four exploratory wells at its Loma La Lata field in Neuquen Province. The discovery could eventually increase Argentina's proven gas reserves by about 34% from 13.3 trillion cubic feet, according to Energy Secretariat Data.
Bonds also edged higher on continued momentum after the government said Wednesday it will offer investors the opportunity to swap bonds dating back to the country's default in 2001 for Discount 2033 bonds, GDP Warrants, and Global 2017 bonds. About $6.1 billion of default bonds are eligible for the swap, which runs through the end of the year.
The peso-denominated 2033 discount bond added 0.8% in price terms to close at ARS192, to yield 6.96%. The dollar-denominated Global 2017, rose 1% in price terms to ARS415, with the yield at 8.14%.
The peso ended the week with a slight dip after holding steady through most of the week. The peso was quoted by Thomson Reuters as closing in interbank markets at ARS3.98 to the U.S. dollar, weakening from ARS3.9725 at on Wednesday.
Argentine stocks closed virtually unchanged Thursday from the record set a day earlier, while bonds ended the week on a positive note in moderate buying after the government re-opened a debt swap for defaulted bonds.
The Merval index of leading shares ended the day at 3,476.42 points, up less than two-tenths of a point from Wednesday and bringing the gain for the week to just over 2% and for the year to almost 50%. Markets will be closed Friday ahead of the Christmas weekend.
One of the biggest gainers Thursday was electricity transmission company Transener (TRAN.BA), which surged 9.5% to 1.61 Argentine pesos ($0.40) amid speculation that the government may soon ease up on residential power rates, said Besfamille brokerage trader Diego Zavaleta.
Shares of Argentine oil and gas firm YPF SA (YPF, YPFD.BA), a unit of Spanish energy group Repsol YPF SA (REP, REP.MC), soared 11.1% to close at ARS205.
Earlier in the day, Repsol YPF said it will sell another 3.3% stake in YPF SA to private-equity firm Eton Park Capital Management for $500 million.
Repsol, which took over the Argentine company in 1999, will still hold a 79.84% stake in the group, with the Peterson Group owning 15.46% and 4.69% freely floating shares. Repsol said the move is part of its strategy to rebalance its global asset portfolio. YPF said Thursday that it has been awarded a $250 million loan from the Andean Development Corporation, or CAF, to partially fund its oil and gas production, refining and sales investment plans.
The sale and loan comes on the heels of a major gas find by YPF in Argentina. Earlier this month, YPF said it had found an estimated 4.5 trillion cubic feet of unconventional gas after drilling four exploratory wells at its Loma La Lata field in Neuquen Province. The discovery could eventually increase Argentina's proven gas reserves by about 34% from 13.3 trillion cubic feet, according to Energy Secretariat Data.
Bonds also edged higher on continued momentum after the government said Wednesday it will offer investors the opportunity to swap bonds dating back to the country's default in 2001 for Discount 2033 bonds, GDP Warrants, and Global 2017 bonds. About $6.1 billion of default bonds are eligible for the swap, which runs through the end of the year.
The peso-denominated 2033 discount bond added 0.8% in price terms to close at ARS192, to yield 6.96%. The dollar-denominated Global 2017, rose 1% in price terms to ARS415, with the yield at 8.14%.
The peso ended the week with a slight dip after holding steady through most of the week. The peso was quoted by Thomson Reuters as closing in interbank markets at ARS3.98 to the U.S. dollar, weakening from ARS3.9725 at on Wednesday.
Argentina's Stocks Rise Monday
Argentine stocks and bonds advanced Monday, with the market taking its cue from the gains in Europe and rising international oil prices. The peso closed unchanged at ARS3.975 to the dollar. Argentina's benchmark Merval stock index rose 1.8% to close at 3465.31. Volume was moderate at ARS72 million ($18 million).
Steel-tube manufacturer Tenaris (TS, TEN.MI), rose 2.5% to settle at ARS97.90. The company sells its pipes to the oil sector and its share price often tracks international crude-oil prices. Oil prices got a lift Monday as cold weather in Europe help to boost international prices to nearly $89 a barrel.
Investor demand also focused on banking group Grupo Financiero Galicia (GGAL, GGAL.BA), which rose 5% to close at ARS6.26.
Bonds performed well Monday, with the peso-denominated 2033 discount bond rising 0.8% in price terms to ARS185.50, to yield 7.3%. The dollar-denominated Global 2017 added 0.9% in price terms to close at ARS379.25, with the yield at 8.8%.
Argentina 3Q Account Surplus $900 Million
Argentina posted a current account surplus of $900 million during the third quarter of 2010, coming in slightly lower than expectations, the national statistics institute, Indec, reported Monday.
The current account surplus, which is the broadest measure of a country's transactions with the rest of the world, was down from $3.1 billion in the second quarter and $1.14 billion a year earlier.
CHILE:
All markets in Chile will be open only half a day on Friday, Christmas Eve.
FRIDAY:
Chile Stocks Close Higher Christmas Eve
Chile's blue-chip Ipsa index ended higher Friday, fueled by retail holding giant Cencosud's (CENCOSUD.SN) rise as participants applauded its aggressive $1.0 billion expansion plan for 2011.
The Ipsa rose 0.2% to 4895.59, ending its streak of four straight losses. Meanwhile, market volume skyrocketed to 1.033 trillion Chilean pesos ($2.20 billion), after the local Cueto family transferred its 28.1% controlling stake of flagship carrier LAN Airlines (LFL, LAN.SN) to a new holding company, in the single largest transaction to ever take place on the Santiago Stock Exchange.
Volume rose as Chilean President Sebastian Pinera auctioned off his 13.7% stake in soccer club Colo-Colo (COLO-COLO.SN), divesting himself of the last major asset he was expected to sell. After the auction, Colo-Colo shares ended 4.3% higher at CLP250.02
Market volume totaled CLP81.1 billion the prior session.
Heavily-weighted Cencosud rose 1.3% to CLP3,649.80 as its investment plan, which was reported after market close the prior session.
LAN Airlines gained 0.4% to CLP14,573.00, after the Cuetos transferred their stake in the airline from their Costa Verde Aeronautica (CVA.SN) holding company to another holding company they own. The move aims to simplify LAN's ownership structure to facilitate the merger process with Brazilian carrier TAM SA (TAM, TAMM4.BR).
The blue-chip index had fallen sharply since Monday when the central bank's half-year Financial Stability Report said the Ipsa was overpriced. "We likely won't see the Ipsa falling much further on the central bank's comments after this week's correction," said Arriagada.
The peso ended slightly weaker against the dollar in very light trading ahead of the Christmas holiday. The peso ended at CLP469.80 to the dollar compared to Thursday's close of CLP469.30, while trading in a range of CLP468.90 to CLP470.30.
In the bond market, yields on inflation-indexed Chilean central bank bonds, or BCUs, ended mixed in light over-the-counter trading. The yield on five-year BCU bonds ended at 2.65%, from 2.64% on Thursday, while the yield on 10-year BCUs closed at 2.91%, from 2.92% the prior session .
Chile Peso Closes Slightly Weaker
Chile's peso ended slightly weaker against the dollar Friday in very light trading ahead of the Christmas holiday. The peso ended weaker at CLP469.80 to the dollar compared to Thursday's close of CLP469.30, while trading in a range of CLP468.90 to CLP470.30.
Chile Government's Corfo Approves Stake Sale In Water Utilities
The Chilean government's Corfo development corporation approved the sale of the state's minority stakes in four water utilities, which is expected to garner a total of $1.6 billion.
The funds will be used to help finance other state companies such as copper giant Corporacion Nacional del Cobre de Chile and the government's reconstruction efforts following the devastating earthquake that hit the country in February.
"Corfo's board has decided to use these funds to strengthen the financial position of certain state companies which need a capital injection to expand their operations and for profitable investments in projects that will improve their productivity," Corfo said in a statement Friday.
At a joint press conference Wednesday, Chile's Finance and Economy Ministers announced the sale, which needed Corfo's stamp of approval.
The government aims to sell its 35.0% stake in Aguas Andinas SA (AGUAS-A.SN), which operates in Santiago; its 43.4% stake in Essbio SA (ESSBIO-A.SN) and 45.5% participation in the Essal SA utilities, both operating in southern Chile; and its 29.4% stake in Esval in the port of Valparaiso. The sale of the utilities could take six to nine months to complete.
THURSDAY:
CHILE STOCKS CLOSE FLAT THURSDAY
Chile's blue-chip Ipsa index ended little changed Thursday, as participants remained wary after the central bank warned on Monday that the local market is overvalued. The Ipsa slipped 0.04% to 4884.09, following three straight declines, while market volume fell to 81.1 billion Chilean pesos ($172.9 million), compared with CLP171.6 billion the prior session.
With the Ipsa gaining nearly 39% in peso terms and 46% in dollars in 2010 prior to this week's losses, the central bank's half-year Financial Stability Report on Monday said the Ipsa was overpriced.
"The central bank's assessment created the feeling among some that there was a bubble in the local equity market...although that's something we disagree with," said Maria Jesus Bofill, analyst with local brokerage BCI Corredor de Bolsa.
According to a BCI report, fundamentals such as strong expected growth and corporate earnings support the Ipsa rising to 5,670 points by the end of 2011.
Among decliners Thursday, power companies fell again as the government is expected to decide next week on stricter emissions rules for existing thermal generation plants.
Energy holding company Enersis (ENI, ENERSIS.SN) lost 0.8% to CLP218.46, while power generators Colbun (COLBUN.SN) declined 0.7% to CLP130.10, and AES Gener (GENER.SN) dropped 1.4% to CLP256.47.
Construction and real-estate companies were among the biggest decliners. Construction company Besalco (BESALCO.SN) fell 1.5% to CLP1,040.00, rival SalfaCorp (SALFACORP.SN) dropped 1.0% to CLP1,693.00, and real-estate developer Socovesa (SOCOVESA.SN) declined 2.8% to CLP372.00.
Shipping company Compania Sud Americana de Vapores (VAPORES.SN) gained 3.3% to CLP588.98 after local investment bank Celfin Capital initiated coverage on the company with a buy rating and a 12-month target price of CLP720.
The peso ended slightly weaker against the dollar on concerns the central bank might soon intervene the local currency market and on the fall in international copper prices and the euro's slip versus the dollar. The peso ended at CLP469.30 to the dollar compared with Wednesday's close of CLP468.80, while trading in a range of CLP468.30 to CLP470.30.
In the bond market, yields on inflation-indexed Chilean central bank bonds, or BCUs, ended higher after local retailer La Polar (LAPOLAR.SN) issued a total $229.6 million in six-, 10- and 21-year inflation-indexed bonds.
The yield on five-year BCU bonds ended at 2.64%, up from 2.63% Wednesday, while the yield on 10-year BCUs closed at 2.92%, up from 2.90% the prior session.
Chile Stocks Decline Wednesday
Chile's blue-chip Ipsa index ended 1.2% lower Wednesday, its third straight decline, after the central bank recently warned that local stocks are overpriced.
The Ipsa fell to 4891.14, while market volume grew to 171.6 billion Chilean pesos ($366 million), compared to volume of CLP151.8 billion the prior session.
As the Ipsa gained around 39% measured in pesos and 46% measured in dollars in 2010 prior to this week's losses, the central bank's president, Jose de Gregorio, said Tuesday that "the Ipsa is somewhat overvalued." His assessment, which echoed those made Monday in the central bank's half-year Financial Stability Report, has pulled the Ipsa lower since the start of the week.
"If the Ipsa were to continue rising, companies would need to post better-than-expected earnings next year to justify that," Andaur said.
Retailers, which have fueled the Ipsa's record-run this year, were among the session's biggest decliners, as were power generators. Within the retail sector, the nation's largest department store, Falabella (FALABELLA.SN), shed 1.0% to CLP5,174.60; retail holding giant Cencosud (CENCOSUD.SN) decreased 1.9% to CLP3,605.10; retailer La Polar (LAPOLAR.SN) fell 1.8% to CLP3,338.60; and department store Ripley (RIPLEY.SN) lost 1.2% to CLP649.98.
After the government said it could tighten emissions rules for existing thermal generation plants, power generators saw their share prices slip. The nation's largest power producer Endesa (EOC, ENDESA.SN) decreased 1.6% to CLP867.36; its parent company, energy holding firm Enersis (ENI, ENERSIS.SN), lost 2.1% to CLP220.20; and rival Colbun (COLBUN.SN) declined 1.4% to CLP130.95.
The peso ended flat against the dollar, just shy of a 31-month high, as participants feared the central bank could intervene in the local currency market if the peso continues appreciating.
The peso ended at CLP468.80 to the dollar compared with Tuesday's close of CLP468.70, while trading in a range of CLP468.50 to CLP471.00.
The central bank's de Gregorio said Monday the monetary authority "doesn't rule out" increasing foreign currency reserves as a way to alleviate the peso's strength. In the bond market, yields on inflation-indexed Chilean central bank bonds, or BCUs, ended slightly lower in thin over-the-counter trading. The yield on five-year BCU bonds ended at 2.63%, down from 2.64% on Tuesday, while the yield on 10-year BCUs closed at 2.90%, down from 2.92% in the prior session.
Chile Stocks Close Lower Monday
Chile's blue-chip Ipsa index ended lower Monday as investors selectively booked profits on sectors that have posted strong growth recently. The Ipsa ended 0.3% lower at 4992.94, while market volume fell to 105.4 billion Chilean pesos ($224.3 million), compared to CLP226.5 billion Friday. The Chilean peso closed at a 31-month high against the dollar, as international copper prices rose.
Construction company SalfaCorp (SALFACORP.SN) dropped 1.2% to CLP1,724.60, and real-estate developer Socovesa (SOCOVESA.SN) declined 1.3% to CLP388.53 following recent strong gains on expectations that a ramping up of post-earthquake reconstruction activities will boost profits.
Earlier in the session, the Lima Stock Exchange decided to suspend integration with its Chilean and Colombian peers until capital gains taxes in Peru are standardized to 5%. The Chilean and Colombian bourses will continue with the integration of their stock exchanges without their Peruvian counterpart, a Santiago Stock Exchange statement said.
Chile's 2010 GDP May Grow 5.2%
Gross domestic product will likely grow 5.2% on the year in 2010 and between 5.5% and 6.5% in 2011 on significant domestic demand, the bank said Monday. Chile produces more than a third of the world's copper, the price of the metal is a significant indicator of the country's economic health. Finance Minister Felipe Larrain said Monday. "We've had a year of recovery, from a GDP contraction of 1.5% last year; growth [this year] will likely be in the middle of the 5%-to-5.5% range," Larrain said in a speech Monday at the presidential palace.
PERU:
PERU STOCKS CLOSED LOWER THURSDAY
Peru's main stock market indices ended mixed Thursday, following uneven results in international markets and some lower metals prices.
The Lima Stock Exchange's broad General index close down 0.13% at 22689.38. The Selective blue-chip index was up however by 0.35% to close at 31411.27.
Losing ground was silver and zinc miner Sociedad Minera El Brocal SAA (BROCALC1.VL), down 0.87% to close at $57.
Peru's leading property and engineering company Grana y Montero (GRAMONC1), was lower by 1.18% to close at 6.72 soles ($2.40), while financial holding company Credicorp Ltd. (BAP) lost 0.20% to close at $119.61. Credicorp owns Peru's biggest bank, Banco de Credito.
Copper miners however gained ground, with Southern Copper Corp. (SCCO, SCCO.VL) up 0.21% to close at $48.35, while Sociedad Minera Cerro Verde SAA (CVERDEC1.VL) was up 0.98% to close at $50.50.
According to the Central Reserve Bank of Peru's website, the sol ended slightly stronger at PEN2.800 per dollar. In the previous session the central bank said the sol closed at PEN2.803 per dollar.
Peru's Main Indexes End Higher Monday
Peru's main stock market indexes ended higher Monday, boosted by metals prices and despite news that the Lima exchange is suspending a planned integration with the Chilean and Colombian exchanges. The sol ended slightly stronger at PEN2.808 per dollar. In the previous session the sol closed at PEN2.813.
A statement from Peru's stock exchange earlier in the day said the planned merger was on hold until passage of a new law standardizing capital gains taxes at 5%, from a current range of 5% to 30%. The Lima Stock Exchange's broad General index rose 0.26% to close at 22092.86. The Selective blue-chip index rose 0.08%, closing at 30896.49, while the key mining subindex gained 0.71%.
Precious metals miner Compania de Minas Buenaventura SAA (BVN, BUENAVC1) rose 1.15% on higher gold prices to close at $48.55, while red metal miner Southern Copper Corp. (SCCO, SCCO.VL) was up 1.48%, in line with higher red metal prices, to close at $47.21. Tin miner Minsur SA (MINSURI1.VL) rose 1.68% to close at 10.87 soles ($3.88), as tin prices gained. Credicorp Ltd. (BAP), rising 0.25% to close at $121.30. Credicorp owns Peru's biggest bank, Banco de Credito.
VENEZUELA:
Venezuela Unemployment Drops To 7.7%
Venezuela's unemployment rate declined to 7.7% in November, compared with the 9% rate seen in October, the National Statistics Institute, or INE, reported Thursday. Unemployment in the South American country was recorded at 7.5% in November 2009, the institute said.
According to the post on the INE website, 44.8% of employed Venezuelans worked in the informal economy last month while 55.2% were in the formal sector.
____________________________________________________________
European Markets:
FRIDAY: EURO STOXX 50 2,861.94 -7.69 (-0.27%)
THURSDAY:EURO STOXX 50 2,860.37 -9.26 (-0.32%)
WEDNESDAY: EURO STOXX 50 2,869.63 -7.36 (-0.26%)
TUESDAY: DJ EURO STOXX 50 2,859.44 +20.22 (0.71%)
The European benchmark Stoxx Europe 600 Index advanced, extending a two-year high, and U.S. equities futures rose.
THURSDAY:EURO STOXX 50 2,860.37 -9.26 (-0.32%)
WEDNESDAY: EURO STOXX 50 2,869.63 -7.36 (-0.26%)
TUESDAY: DJ EURO STOXX 50 2,859.44 +20.22 (0.71%)
The European benchmark Stoxx Europe 600 Index advanced, extending a two-year high, and U.S. equities futures rose.
The euro rose from near a two-week low against the dollar and yen after Chinese Vice Premier Wang Qishan said his nation had taken “concrete action” to help the European Union with its debt problems.
The euro climbed 0.2 percent to $1.3154 as of 6:23 a.m. in New York, from $1.3131 yesterday, when it dropped to $1.3095, the lowest since Dec. 2. The common currency was up 0.1 percent to 110.08 yen after paring earlier gains. It fell to 109.58 yen yesterday, the weakest since Dec. 7. The Japanese currency rose to 83.69 per dollar, from 83.77, after reaching 83.57, the strongest since Dec. 14.
The euro gained on speculation investments by China, which holds a record $2.65 trillion in foreign-exchange reserves, will ease Europe’s sovereign fiscal crisis and boost the allure of assets in the region.
China - EU Largest Trading Partner
The EU is China’s largest trade partner and the Asian nation is Europe’s second-biggest export market, with bilateral trade increasing 33.1 percent in the 11 months through November from a year earlier to $433.88 billion, China’s customs department said on Dec. 10.
“EU members have taken a number of steps to actively respond to the sovereign-debt crisis,” Wang said at a forum in Beijing today. “We hope these measures will quickly produce results and lead to a steady recovery of the EU economies.”
EU OKS EMERGENCY MEASURES TO HELP IRISH BANKS
The European Commission temporarily approves billions of euros in state aid as emergency measures to help Allied Irish Banks, the nationalized Anglo Irish Bank and the Irish Nationwide Building Society.
MONDAY: EURO STOXX 50 2,851.19 +29.42 (1.04%)
The Stoxx Europe 600 index advanced 0.7% to end at 278.38 points European stocks rose on Monday, with the Italian market posting particularly strong gains, while airlines and retailers fell on fears of lost business caused by the severe wintry weather.
FTSE Ends Higher Friday;
Closes Above 6000
FTSE 100 6008.92 +12.85 +0.21%
FTSE 250 11492.88 -76.34 -0.66%
DJ UK Smaller Companies 971.44 -1.93 -0.20%
Most mining stocks close in the red, with Randgold Resources down 4.3% after a profit warning. African Barrick Gold is down 1.2% and Eurasian Natural Resources down 0.9%. On the upside, however, retailers advance, with Next +2% and Kingfisher +1.3%.
Rangold Resources Ltd. (GOLD, RRS.LN) has revised its fourth-quarter gold production guidance to between 135,000 and 140,000 troy ounces after suffering production setbacks in Ivory Coast and Mali, the company's chief financial officer said Friday.
THURSDAY: FTSE 100 5,996.07 +12.58 (0.21%)
WEDNESDAY: FTSE 100 5,983.49 +31.69 (0.53%)
TUESDAY: FTSE 100 5951.80 +60.19 +1.02%
London Stocks End Up Higher Tuesday
FTSE 100 5951.80 +60.19 +1.02%
FTSE 250 11506.65 +73.54 +0.64%
DJ UK Smaller Companies 964.34 +3.77 +0.75%
UK Business Minister In Threat To Quit If Pushed
The U.K. business minister has privately indicated he could quit and "bring the government down" if he is pushed too far in talks with the Conservatives, in remarks published Tuesday.
The loose tongue of the U.K. business secretary might have created headlines the country's coalition government could have done without Tuesday, but it's the latest figures on the public finances that are likely to cause more long-term difficulties.
UK Treasury: Nov Net Borrowing Data In Line With OBR Forecast
The U.K. Treasury said Tuesday the dire November net borrowing data still left the government on track to meet the independent Office for Budget Responsibility's full-year borrowing estimates.
UK Dec Consumer Confidence Steady Ahead Of Sales Tax Hike
U.K. consumer confidence held steady in December, helped by an increase in perceptions over buying big ticket items ahead of the U.K.'s steep sales tax hike in January which masked falls elsewhere, a monthly survey released by polling firm GfK NOP showed Tuesday.
The U.K.'s Office for Budget Responsibility said Tuesday it has only factored GBP1.6 billion in central government privatization proceeds into its official forecasts for coming years.
The euro climbed 0.2 percent to $1.3154 as of 6:23 a.m. in New York, from $1.3131 yesterday, when it dropped to $1.3095, the lowest since Dec. 2. The common currency was up 0.1 percent to 110.08 yen after paring earlier gains. It fell to 109.58 yen yesterday, the weakest since Dec. 7. The Japanese currency rose to 83.69 per dollar, from 83.77, after reaching 83.57, the strongest since Dec. 14.
The euro gained on speculation investments by China, which holds a record $2.65 trillion in foreign-exchange reserves, will ease Europe’s sovereign fiscal crisis and boost the allure of assets in the region.
China - EU Largest Trading Partner
The EU is China’s largest trade partner and the Asian nation is Europe’s second-biggest export market, with bilateral trade increasing 33.1 percent in the 11 months through November from a year earlier to $433.88 billion, China’s customs department said on Dec. 10.
“EU members have taken a number of steps to actively respond to the sovereign-debt crisis,” Wang said at a forum in Beijing today. “We hope these measures will quickly produce results and lead to a steady recovery of the EU economies.”
EU OKS EMERGENCY MEASURES TO HELP IRISH BANKS
The European Commission temporarily approves billions of euros in state aid as emergency measures to help Allied Irish Banks, the nationalized Anglo Irish Bank and the Irish Nationwide Building Society.
MONDAY: EURO STOXX 50 2,851.19 +29.42 (1.04%)
The Stoxx Europe 600 index advanced 0.7% to end at 278.38 points European stocks rose on Monday, with the Italian market posting particularly strong gains, while airlines and retailers fell on fears of lost business caused by the severe wintry weather.
UNITED KINGDOM:
FRIDAY: FTSE 100 6,008.92 +12.85 (0.21%) FTSE Ends Higher Friday;
Closes Above 6000
FTSE 100 6008.92 +12.85 +0.21%
FTSE 250 11492.88 -76.34 -0.66%
DJ UK Smaller Companies 971.44 -1.93 -0.20%
Most mining stocks close in the red, with Randgold Resources down 4.3% after a profit warning. African Barrick Gold is down 1.2% and Eurasian Natural Resources down 0.9%. On the upside, however, retailers advance, with Next +2% and Kingfisher +1.3%.
Rangold Resources Ltd. (GOLD, RRS.LN) has revised its fourth-quarter gold production guidance to between 135,000 and 140,000 troy ounces after suffering production setbacks in Ivory Coast and Mali, the company's chief financial officer said Friday.
THURSDAY: FTSE 100 5,996.07 +12.58 (0.21%)
WEDNESDAY: FTSE 100 5,983.49 +31.69 (0.53%)
TUESDAY: FTSE 100 5951.80 +60.19 +1.02%
London Stocks End Up Higher Tuesday
FTSE 100 5951.80 +60.19 +1.02%
FTSE 250 11506.65 +73.54 +0.64%
DJ UK Smaller Companies 964.34 +3.77 +0.75%
Economy Faces Difficult Months Ahead
U.K. Prime Minister David Cameron said Tuesday that the country's economy faced some challenging months ahead as many trading partners faced uncertainty, but the government was focused on driving growth and boosting employment.UK Business Minister In Threat To Quit If Pushed
The U.K. business minister has privately indicated he could quit and "bring the government down" if he is pushed too far in talks with the Conservatives, in remarks published Tuesday.
The loose tongue of the U.K. business secretary might have created headlines the country's coalition government could have done without Tuesday, but it's the latest figures on the public finances that are likely to cause more long-term difficulties.
UK Treasury: Nov Net Borrowing Data In Line With OBR Forecast
The U.K. Treasury said Tuesday the dire November net borrowing data still left the government on track to meet the independent Office for Budget Responsibility's full-year borrowing estimates.
UK Dec Consumer Confidence Steady Ahead Of Sales Tax Hike
U.K. consumer confidence held steady in December, helped by an increase in perceptions over buying big ticket items ahead of the U.K.'s steep sales tax hike in January which masked falls elsewhere, a monthly survey released by polling firm GfK NOP showed Tuesday.
The U.K.'s Office for Budget Responsibility said Tuesday it has only factored GBP1.6 billion in central government privatization proceeds into its official forecasts for coming years.
London Stocks End Higher Monday
FTSE 100 5891.61 +19.86 +0.34%
FTSE 250 11433.11 +6.33 +0.06%
DJ UK Smaller Companies 960.56 +0.38 +0.04%
The U.K. economy will continue to recover over the next two years, but only slowly, with growth particularly sluggish at the start of 2011, the Confederation of British Industry said Monday.
FTSE 100 5891.61 +19.86 +0.34%
FTSE 250 11433.11 +6.33 +0.06%
DJ UK Smaller Companies 960.56 +0.38 +0.04%
The U.K. economy will continue to recover over the next two years, but only slowly, with growth particularly sluggish at the start of 2011, the Confederation of British Industry said Monday.
U.K. retailers face a sales shortfall of up to 5% in their busiest and most important quarter as last minute Christmas shoppers are stymied by the severe weather.The head of British airports operator BAA Airports Ltd. apologized Monday for chaos at London Heathrow as freezing weather threatened to ruin Christmas plans for "many thousands" of people.
U.K. gross mortgage lending grew at a slower pace in November from October, and at the slowest November pace since 2000. U.K. net mortgage lending accelerated slightly in November from October, according to data from the Bank of England Monday.
U.K. Prime Minister David Cameron played host to union leaders Monday for the first time since taking office, even as senior officials from the labor movement urged action against the government's austerity plans.
National Grid Reassures UK Customers Gas Demand At Record High
U.K. natural gas network operator National Grid PLC (NGG) sought to reassure consumers Monday that there would be sufficient supplies to a meet a new all-time high in demand, despite the utility issuing a gas balancing alert Sunday.
Apax Partners is nearing a deal to acquire German clothing retailer Takko for roughly EUR1.3 billion ($1.7 billion), people familiar with the matter said, in the U.K. private-equity firm's latest big-ticket purchase from a rival buyout firm.
Shares in Gartmore Group Ltd. (GRT.LN) fell sharply Monday after the troubled U.K. find manager said that it is considering a takeover proposal from local rival Henderson Group PLC (HGI.LN) at a discount to its recent share price.
Shares in online gaming company 888 Holdings PLC (888.LN) rose 19% Monday morning on the London bourse following a second takeover tilt from Ladbrokes PLC (LAD.LN), four years after its first attempt to buy its smaller rival.
GERMANY:
Germany’s DAX is closed until Monday
MONDAY: The German DAX 30 index rose 0.5% to end at 7,018.60
The German fertilizer producer rose 1.5% after its Chief Executive Norbert Steiner told the Frankfurter Allgemeine Sonntagszeitung that he believes the company's C$434 million ($431.8 million) takeover offer for Potash One Inc. of Canada would be successful, according to Reuters.
Deutsche Lufthansa AG fell 0.8% after severe weather disrupted flights across Europe.
London retailer Apax may be near deal to buy German retailer Takko
Shares of Volkswagen AG rallied 3.7%
BMW AG gained 1.9%
National Grid Reassures UK Customers Gas Demand At Record High
U.K. natural gas network operator National Grid PLC (NGG) sought to reassure consumers Monday that there would be sufficient supplies to a meet a new all-time high in demand, despite the utility issuing a gas balancing alert Sunday.
Apax Partners is nearing a deal to acquire German clothing retailer Takko for roughly EUR1.3 billion ($1.7 billion), people familiar with the matter said, in the U.K. private-equity firm's latest big-ticket purchase from a rival buyout firm.
Shares in Gartmore Group Ltd. (GRT.LN) fell sharply Monday after the troubled U.K. find manager said that it is considering a takeover proposal from local rival Henderson Group PLC (HGI.LN) at a discount to its recent share price.
Shares in online gaming company 888 Holdings PLC (888.LN) rose 19% Monday morning on the London bourse following a second takeover tilt from Ladbrokes PLC (LAD.LN), four years after its first attempt to buy its smaller rival.
GERMANY:
Germany’s DAX is closed until Monday
MONDAY: The German DAX 30 index rose 0.5% to end at 7,018.60
The German fertilizer producer rose 1.5% after its Chief Executive Norbert Steiner told the Frankfurter Allgemeine Sonntagszeitung that he believes the company's C$434 million ($431.8 million) takeover offer for Potash One Inc. of Canada would be successful, according to Reuters.
Deutsche Lufthansa AG fell 0.8% after severe weather disrupted flights across Europe.
London retailer Apax may be near deal to buy German retailer Takko
Shares of Volkswagen AG rallied 3.7%
BMW AG gained 1.9%
FRANCE:
FRIDAY: CAC 40 3,900.39 -10.93 (-0.28%)
France To Build Two Naval Command Ships With Russia
France and Russia have agreed to build jointly two French Mistral-class command and amphibious assault warships, and possibly four, President Nicolas Sarkozy's office said Friday.
THURSDAY:CAC 40 3,898.63 -21.08 (-0.54%)
WEDNESDAY: CAC 40 3,919.71 -7.78 (-0.20%)
TUESDAY: CAC 40 3,908.03 +22.95 (0.59%)
MONDAY: CAC 40 3,885.08 +17.73 (0.46%)
Shares of Peugeot SA up 0.8% and Michelin SA up 1.6%.
Credit Agricole SA fell 2.1%
French Sovereign Debt Insurance Costs Hit All-Time High
The cost of insuring French sovereign debt against default using credit default swaps hit an all-time high Monday, as the CDS market tracked weakness in the cash bond market and CDS contracts were extended for three months.
France's five-year sovereign CDS rose to 108 basis points, according to Markit, from a previous high of 105 basis points on Nov. 30. "Volumes are very light, and French cash is seeing some selling by fast money," said one trader.
The quarterly CDS "roll," when contracts are extended by three months, also contributed to the rise, this trader said. CDS are derivatives that function like a default insurance contract for debt. If a borrower defaults, sellers compensate buyers. A rise of one basis point in the cost of five-year CDS equates to a $1,000 rise in the annual cost of protecting $10 million of debt for five years.
BELGIUM:
WEDNESDAY:
Belgium Dec Business Confidence Rises To +3.1 From +0.8
Confidence among Belgian business executives rose in December for the sixth straight month, reaching its highest level since the fourth quarter of 2007, the Belgian central bank said Wednesday.
The bank's measure for business sentiment climbed to +3.1 in December from +0.8 in November, driven almost entirely by a sharp rise in confidence among manufacturers.
Confidence in the construction sector also rose, but it fell in the trade and business-services segments of the indicator.
Although Belgium accounts for only about 4% of the European Union's gross domestic product, the survey of business sentiment is closely watched. The country is one of the most open economies in the world, with exports accounting for about 75% of GDP. To calculate confidence, the bank polls the heads of about 4,500 companies, subtracting negative votes from positive ones.
IRELAND:
THURSDAY:
WEDNESDAY: Dublin Stocks: ISEQ Ending Flat At 2,868; AIB -6.4%
TUESDAY: Dublin Stocks: ISEQ Ending +1.3% At 2,871; Bank Of Ireland +8.6%
SPAIN:
PORTUGAL:
THURSDAY:
FITCH CUTS PORTUGAL RATING
Fitch cuts its ratings on Portugal, citing a slower reduction in the current deficit and a "much more difficult financing environment" for its government and banks. Rating cut one notch to A+, putting it four notches under highest rating of AAA.
FINLAND:
Finland Raised 2010 Growth Forecast
The Finnish government Monday upgraded its growth forecast for this year but also marginally downgraded its prediction for 2011 and warned the country's general government finances would remain deep in the red for years to come.
The finance ministry said it expected Finland's gross domestic product to grow 3.2% this year and 2.9% in 2011, compared with an August forecast of 2.0 and around 3.0% respectively.
In the third quarter, the Nordic country's economy grew 3.7% year-on-year according to official statistics released earlier this month.
"The Finnish economy has recovered quickly and widely from the 2009 financial crisis," the ministry said in a statement.
Finland, the only Nordic country that is part of the euro zone, took a harsher beating during the global financial crisis than its Scandinavian neighbors. The ministry stressed Monday that unemployment was falling faster than predicted and was expected to slip from 8.4% this year to 7.8% next year and 7.4% in 2012.
Inflation meanwhile was expected to continue climbing to 2.4% in 2011, it said. The Finnish turnaround was linked to a pick-up in world trade, driven by strong growth in developing Asian countries and in Latin America, it said, adding however that trade in most of Europe remained sluggish.
The country's public finances, while in better shape than in a number of other euro-countries, would meanwhile remain in the red for years to come, the ministry cautioned, adding the public deficit would this year swell to above the 3% limit specified by the Stability and Growth Pact.
"Economic growth, tax increases and the gradual ending of stimulus measures will improve the state of general government finances in 2011, but even so general government finances will remain in deficit, and there is currently no prospect of rectifying the situation in the next few years," the ministry said.
Finland's export-reliant economy exited recession at the beginning of this year and its economy has slowly but steadily been improving. Last year, the country's economy shrank by nearly 8%, as demand for its capital investment equipment and other main exports plummeted.
:
RUSSIA:
FRIDAY: CAC 40 3,900.39 -10.93 (-0.28%)
France To Build Two Naval Command Ships With Russia
France and Russia have agreed to build jointly two French Mistral-class command and amphibious assault warships, and possibly four, President Nicolas Sarkozy's office said Friday.
THURSDAY:CAC 40 3,898.63 -21.08 (-0.54%)
WEDNESDAY: CAC 40 3,919.71 -7.78 (-0.20%)
TUESDAY: CAC 40 3,908.03 +22.95 (0.59%)
MONDAY: CAC 40 3,885.08 +17.73 (0.46%)
Shares of Peugeot SA up 0.8% and Michelin SA up 1.6%.
Credit Agricole SA fell 2.1%
French Sovereign Debt Insurance Costs Hit All-Time High
The cost of insuring French sovereign debt against default using credit default swaps hit an all-time high Monday, as the CDS market tracked weakness in the cash bond market and CDS contracts were extended for three months.
France's five-year sovereign CDS rose to 108 basis points, according to Markit, from a previous high of 105 basis points on Nov. 30. "Volumes are very light, and French cash is seeing some selling by fast money," said one trader.
The quarterly CDS "roll," when contracts are extended by three months, also contributed to the rise, this trader said. CDS are derivatives that function like a default insurance contract for debt. If a borrower defaults, sellers compensate buyers. A rise of one basis point in the cost of five-year CDS equates to a $1,000 rise in the annual cost of protecting $10 million of debt for five years.
BELGIUM:
WEDNESDAY:
Belgium Dec Business Confidence Rises To +3.1 From +0.8
Confidence among Belgian business executives rose in December for the sixth straight month, reaching its highest level since the fourth quarter of 2007, the Belgian central bank said Wednesday.
The bank's measure for business sentiment climbed to +3.1 in December from +0.8 in November, driven almost entirely by a sharp rise in confidence among manufacturers.
Confidence in the construction sector also rose, but it fell in the trade and business-services segments of the indicator.
Although Belgium accounts for only about 4% of the European Union's gross domestic product, the survey of business sentiment is closely watched. The country is one of the most open economies in the world, with exports accounting for about 75% of GDP. To calculate confidence, the bank polls the heads of about 4,500 companies, subtracting negative votes from positive ones.
IRELAND:
THURSDAY:
IRELAND RECAPITALIZES ALLIED IRISH BANK
Ireland's Finance Minister Brian Lenihan announces plans to recapitalize Allied Irish Banks by 3.7 billion to meet the financial regulator's year-end capital requirements, effectively making it the fourth lender to be nationalized. WEDNESDAY: Dublin Stocks: ISEQ Ending Flat At 2,868; AIB -6.4%
TUESDAY: Dublin Stocks: ISEQ Ending +1.3% At 2,871; Bank Of Ireland +8.6%
SPAIN:
SPAIN SAYS 2010 DEFICIT TO BE IN LINE WITH FORECAST
Spain's central government budget deficit narrows 46% in the eleven months to November, in further evidence the country's efforts to close one of the euro zone's biggest funding gaps is on track.PORTUGAL:
THURSDAY:
FITCH CUTS PORTUGAL RATING
Fitch cuts its ratings on Portugal, citing a slower reduction in the current deficit and a "much more difficult financing environment" for its government and banks. Rating cut one notch to A+, putting it four notches under highest rating of AAA.
FINLAND:
Finland Raised 2010 Growth Forecast
The Finnish government Monday upgraded its growth forecast for this year but also marginally downgraded its prediction for 2011 and warned the country's general government finances would remain deep in the red for years to come.
The finance ministry said it expected Finland's gross domestic product to grow 3.2% this year and 2.9% in 2011, compared with an August forecast of 2.0 and around 3.0% respectively.
In the third quarter, the Nordic country's economy grew 3.7% year-on-year according to official statistics released earlier this month.
"The Finnish economy has recovered quickly and widely from the 2009 financial crisis," the ministry said in a statement.
Finland, the only Nordic country that is part of the euro zone, took a harsher beating during the global financial crisis than its Scandinavian neighbors. The ministry stressed Monday that unemployment was falling faster than predicted and was expected to slip from 8.4% this year to 7.8% next year and 7.4% in 2012.
Inflation meanwhile was expected to continue climbing to 2.4% in 2011, it said. The Finnish turnaround was linked to a pick-up in world trade, driven by strong growth in developing Asian countries and in Latin America, it said, adding however that trade in most of Europe remained sluggish.
The country's public finances, while in better shape than in a number of other euro-countries, would meanwhile remain in the red for years to come, the ministry cautioned, adding the public deficit would this year swell to above the 3% limit specified by the Stability and Growth Pact.
"Economic growth, tax increases and the gradual ending of stimulus measures will improve the state of general government finances in 2011, but even so general government finances will remain in deficit, and there is currently no prospect of rectifying the situation in the next few years," the ministry said.
Finland's export-reliant economy exited recession at the beginning of this year and its economy has slowly but steadily been improving. Last year, the country's economy shrank by nearly 8%, as demand for its capital investment equipment and other main exports plummeted.
:
RUSSIA:
FRIDAY:
Russia's X5 To Become Europe's Largest Retailer
X5 Retail Group NV (FIVE.LN), Russia's top retailer by sales, aims to become Europe's largest retailer by 2020, Kommersant reports Friday citing an interview with the X5's Chief Executive Lev Khasis.
Khasis said X5 has an aim for its annual gross sales "to be close to or exceed" RUB3 trillion ($98 billion) by 2020. X5 said Thursday it expects its 2011 gross sales to exceed RUB500 billion, up 40% on the year.
X5 plans to grow both organically and through mergers and acquisitions, Khasis said. X5 acquired Russian grocery chain Kopeyka for $1.65 billion earlier this month.
Newspaper Web site: http://kommersant.ru
Russian Central Bank Lifts
Deposit Rate 25 Basis Points
Russia's central bank tightened monetary policy for the first time since 2008 on Friday, citing growing worries that rising food prices will spur inflation.
"Inflation risks...remain moderate, but need greater attention from authorities," the central bank said in a statement accompanying the decision. "The change will not lead to a significant increase in the cost of funds for end borrowers."
The overnight deposit rate will be raised by 25 basis points to 2.75% effective Monday, while the benchmark refinancing rate was left at an all-time low of 7.75%.
Expectations of higher interest rates were spurred by a combination of solid economic growth in November and rising inflation, which accelerated in the past week as a flood of year-end budget spending hit the economy.
Central bank officials have also indicated in the past that they would like to narrow the spread between various rates.
"Both producer and consumer price growth keeps accelerating, speaking for the necessity to tighten monetary policy," said HSBC's Alexander Morozov in a note to investors before the decision. "Against such a backdrop, some monetary tightening should not harm industrial growth since all policy rates are in negative in real terms now."
Inflation for the year will be lower than last year's 8.8%, the central bank said. Inflation now stands at 8.4% since the beginning of the year, threatening government forecasts of 8.3% to 8.5%.
Russia's central bank chief Sergei Ignatyev on Friday reiterated that the regulator was worried about inflation, which he said was chiefly a result of higher food prices spurred by the summer's crippling drought.
The ruble strengthened to its highest point since September in the run-up to the announcement, but slid to close with a 0.3% gain at RUB34.745, just above its 200-day moving average. Traders expected short-term profit taking in the currency, as market players unwind positions going into the New Year holidays.
The Bank of Russia may have also raised rates in order to rein in capital outflows, which have tapered off in December but far exceeded the regulator's targets for the year.
"In our view, these flows are largely driven by structural factors, such as savings rates continuing to grow faster than investment," Goldman Sachs said in a note to investors "We doubt that higher interest rates will be very effective in stemming that flow and instead believe the outflows will ultimately increase the pressure on authorities to reduce some of the barriers to investment."
Russia Agrees to Buy 2 French WarshipsRussia's X5 To Become Europe's Largest Retailer
X5 Retail Group NV (FIVE.LN), Russia's top retailer by sales, aims to become Europe's largest retailer by 2020, Kommersant reports Friday citing an interview with the X5's Chief Executive Lev Khasis.
Khasis said X5 has an aim for its annual gross sales "to be close to or exceed" RUB3 trillion ($98 billion) by 2020. X5 said Thursday it expects its 2011 gross sales to exceed RUB500 billion, up 40% on the year.
X5 plans to grow both organically and through mergers and acquisitions, Khasis said. X5 acquired Russian grocery chain Kopeyka for $1.65 billion earlier this month.
Newspaper Web site: http://kommersant.ru
Russian Central Bank Lifts
Deposit Rate 25 Basis Points
Russia's central bank tightened monetary policy for the first time since 2008 on Friday, citing growing worries that rising food prices will spur inflation.
"Inflation risks...remain moderate, but need greater attention from authorities," the central bank said in a statement accompanying the decision. "The change will not lead to a significant increase in the cost of funds for end borrowers."
The overnight deposit rate will be raised by 25 basis points to 2.75% effective Monday, while the benchmark refinancing rate was left at an all-time low of 7.75%.
Expectations of higher interest rates were spurred by a combination of solid economic growth in November and rising inflation, which accelerated in the past week as a flood of year-end budget spending hit the economy.
Central bank officials have also indicated in the past that they would like to narrow the spread between various rates.
"Both producer and consumer price growth keeps accelerating, speaking for the necessity to tighten monetary policy," said HSBC's Alexander Morozov in a note to investors before the decision. "Against such a backdrop, some monetary tightening should not harm industrial growth since all policy rates are in negative in real terms now."
Inflation for the year will be lower than last year's 8.8%, the central bank said. Inflation now stands at 8.4% since the beginning of the year, threatening government forecasts of 8.3% to 8.5%.
Russia's central bank chief Sergei Ignatyev on Friday reiterated that the regulator was worried about inflation, which he said was chiefly a result of higher food prices spurred by the summer's crippling drought.
The ruble strengthened to its highest point since September in the run-up to the announcement, but slid to close with a 0.3% gain at RUB34.745, just above its 200-day moving average. Traders expected short-term profit taking in the currency, as market players unwind positions going into the New Year holidays.
The Bank of Russia may have also raised rates in order to rein in capital outflows, which have tapered off in December but far exceeded the regulator's targets for the year.
"In our view, these flows are largely driven by structural factors, such as savings rates continuing to grow faster than investment," Goldman Sachs said in a note to investors "We doubt that higher interest rates will be very effective in stemming that flow and instead believe the outflows will ultimately increase the pressure on authorities to reduce some of the barriers to investment."
Russia agreed Friday to buy at least two French warships in a deal that would boost Moscow's deployment abilities and has worried some of Russia's neighbours.
It's one of the largest military deals between a NATO country and Moscow.
The Kremlin said in a statement Friday that it "has made its choice" to buy two Mistral-class ships. Russian President Dmitry Medvedev informed French President Nicolas Sarkozy on Friday of the decision, Sarkozy's office said in a statement.
The Mistral, which could carry as many as 16 helicopters and dozens of armoured vehicles, would allow Russia to land hundreds of troops quickly on foreign soil.
The prospect has alarmed Georgia, which fought a brief war against Russia in 2008, as well as the ex-Soviet Baltic nations in NATO.
France and Russia have been in talks about the sale for months, but negotiations had dragged on amid questions about how many ships would be built and where, and how much of the technology France would share.
France was seen as the leading contender for the contract, though Russian officials said they were also looking at similar ships built by Spain and Netherlands.
French companies DCNS and STX and Russia's OSK will build the first two ships, according to the deal, "which should be extended by the construction of two additional units," Sarkozy's statement said.
The two presidents hailed what they called unprecedented co-operation, saying it showed their commitment to developing partnerships in defence and security.
____________________________________________________________
Asian Pacific Markets:
CHINA:
FRIDAY: Shanghai 2,835.16 -20.06 (-0.70%)
Hang Seng Index 22,833.80 -69.17 (-0.30%)
THURSDAY: Shanghai 2,855.22 -22.68 (-0.79%)
Hang Seng Index 22,902.97 -142.22 (-0.62%)
WEDNESDAY: Shanghai 2,877.90 -26.22 (-0.90%)
Hang Seng Index 23,045.19 +51.33 (0.22%)
TUESDAY: Shanghai 2,904.11 +51.20 (1.79%)
Hang Seng Index 22,993.86 +354.78 (1.57%)
SATURDAY: December 25, 2010
China raises key interest rates again after inflation hit 28-month high
BEIJING, China - China increased interest rates Saturday for the second time in little more than two months as the government steps up its fight against rising inflation that could threaten political stability.
The move by the People's Bank of China had been expected by the end of the year or early next year.
Effective from Sunday, the benchmark one-year lending rate will climb 25 basis points to 5.81 per cent, while the one-year deposit rate will go up the same amount to 2.75 per cent, the central bank said on its website.
Earlier this month, China's leaders wrapped up an annual economic planning meeting with a pledge to cool surging inflation while shifting the economy toward more stable, balanced growth.
Inflation is especially sensitive in a society where poor families spend up to half their incomes on food. Rising incomes have helped to offset price hikes, but inflation undercuts economic gains that help support the ruling Communist party's claim to power.
Inflation jumped to 5.1 per cent in November, a 28-month high despite a crackdown on speculation and repeated moves to curb a flood of money circulating in the economy from massive stimulus spending and bank lending.
Chinese banks lent a total of 7.45 trillion yuan (US$1.1 trillion) in January-November and are certain to overshoot the government's official lending target of 7.5 trillion yuan.
While a frenzy of lending over the past two years has helped China rebound quickly from the global crisis, combined with bad weather and rising global commodity prices, it has complicated efforts to cool inflation.
November's rate was way above the government's original target of three per cent.
The rate increases, which follow similar moves Oct. 19, also highlight the divergence of China's robust economic expansion from the United States, Europe and Japan, which still are trying to shore up growth.
China's rapid economic growth eased to 9.6 per cent in the three months ending in September from a post-crisis high of 11.9 per cent in the first quarter. It is expected to fall further in coming months but to remain strong.
Mindful of the political turmoil linked to past bouts of inflation, Beijing has already sought to reassure the public it has prices under control.
Earlier this month it raised banks' reserve requirement ratio — meaning they have to hold more deposit funds in reserve rather than lending them out —for the sixth time this year to help curb the surge in lending.
FRIDAY:
China Limits New Cars in BeijingChina overtook the US as the world's biggest car and van market in 2009, with 13.6 million vehicles sold within the country.
New rules take effect in China that restrict car purchases for 2011 by two-thirds in an effort to combat rising traffic woes in the capital, Beijing. City authorities will allow only 240,000 vehicles to be registered for 2011 - one-third of this year's total.
Car buyers have been swamping dealers in anticipation of the new rules, which will still leave about five million cars on the road in the capital. Traffic and air pollution in Beijing is among the worst in the world.
Beijing officials are trying to balance the desire of a growing middle class to have the convenience and status of car ownership, with a huge congestion problem. Officials said the new rules would not solve the full extent of the city's problems, only slow the down the rate at which they are worsening.
Car registrations will be allocated by a license plate lottery system from Friday.
Under the new rules, government departments will not be allowed to increase the size of their fleets for five years. About 750,000 new cars appeared on Beijing's streets this year, raising the total of registered vehicles for the city 4.8 million.
CHINA RAISES FUEL PRICES
China will raise gasoline and diesel prices by 3.8% and 4% respectively beginning Wednesday in the face of rising crude oil prices, despite persistent worries about inflation.
MONDAY: Shanghai 2,852.92 -40.82 (-1.41%)
Hang Seng Index 22,639.08 -75.77 (-0.33%)
JAPAN:
FRIDAY: Nikkei 225 10,279.19 -67.29 (-0.65%)
HOLIDAY SCHEDULE THURSDAY
THURSDAY: Nikkei 225 10,346.48 -24.05 (-0.23%)
WEDNESDAY: Nikkei 225 10,346.48 -24.05 (-0.23%)
TUESDAY: Nikkei 225 10,370.53 +154.12 (1.51%)
MONDAY: Nikkei 225 10,216.41 -87.42 (-0.85%)
FRIDAY:
Japan Agrees on Record 92.4 Trillion Yen Draft Budget
The Japanese government has approved a record level of spending of 92.4 trillion yen ($1.1tn; £711bn) for the next financial year. The cabinet agreed the draft budget, which must still be approved by parliament before 31 March.
Japan's economy has suffered from deflation, a high yen that hurts exports, weak domestic demand and poor consumer confidence. The budget is aimed at boosting the economy, but adds to public debt.
Debt-servicing costs and social security spending making up about 55% of the budget. Aid for local authorities accounts for another 18.2% of the budget. The remainder of the spending is split among defense, public works projects, education and technology.
The Democratic Party-led administration has promised to keep new borrowing at 44.3tn, in line with this year's level.
But Japan was forced to raise spending due to higher debt servicing costs. Japan's public debt is expected to reach 891tn yen, or 184% GDP, by the end of March 2012, the highest among developed nations.
The government said tax revenues would be about 40.9tn yen in the next fiscal year, with another 7.2tn raised by raiding special reserves.The government has already reined in spending programs including handouts to fund childcare.
Fujitsu To Expand Investment In Cloud Computing In 2011
Fujitsu Ltd. (FJTSY) President Masami Yamamoto said Friday the company plans to invest more in cloud computing in fiscal 2011 than the roughly 100 billion yen ($1.21 billion) in fiscal 2010 ending next March. SOUTH KOREA:
TENSIONS IN KOREA
South Korea completes a regular artillery test at a marine outpost on Yeonpyeong Island, with dozens of rounds directed into waters southwest of the island. There has been no response so far from North Korea despite its earlier threats of retaliation. AUSTRALIA:
FRIDAY: S&P/ASX 200 4,777.30 -21.70 (-0.45%)
Rio Tinto Raised Riversdale
Buyout Offer to $3.9bn
Anglo-Australian mining giant Rio Tinto has upped its bid for Sydney-based Riversdale Mining, making a fresh $3.9bn (£2.5bn) offer. Riversdale's directors said that the offer provided "immediate value" and that they would be recommending it to shareholders
Rio made a $2.2bn offer for the company earlier this month.
Riversdale, whose largest shareholder is India's Tata Steel, has huge coking-coal projects in Mozambique. Both Tata and Brazil's Vale, which has coal mines in Mozambique, are seen as potential rival bidders.
THURSDAY:S&P/ASX 200 4,799.00 +20.60 (0.43%)
WEDNESDAY: S&P/ASX 200 4,778.40 +6.50 (0.14%)
TUESDAY: S&P TSX 13,193.28 -8.18 (-0.06%)
MONDAY: S&P/ASX 200 4,736.60 -26.50 (-0.56%)
NEW ZEALAND:
WEDNESDAY:The NZX-50 closed up just 0.1%, or 3.28 points, higher at 3322.38 points.
The New Zealand stock exchange closed flat Wednesday as volumes remained light as the holiday period nears and there was little news to excite investors.
Energy company Contact Energy closed down 1.1% to NZ$6.17 as heavy rain over the last few days changed investors' views on energy prices in early 2011.
Telecom Corp. of New Zealand closed down 0.5% to NZ$2.22 on profit taking as the stock had risen 7.2% after it was announced last week that the country's largest telecommunications player was a priority bidder to build the majority of the country's new nationwide NZ$3 billion fiber network.
Fletcher Building had released its bidder's statement in relation to its takeover bid for Crane Group, the stock closed up 0.3% to NZ$7.79 as overnight gains.
____________________________________________________________
WORLD FOREX CURRENCIES SNAPSHOT:
(FRIDAY, DEC 24, 2010 12:30 PM EST)
EUR/USD 1.3116 +0.0001 (0.01%)
USD/JPY 82.9100 -0.0900 (-0.11%)
GBP/USD 1.5437 +0.0013 (0.08%)
USD/CAD 1.0063 -0.0038 (-0.38%)
USD/HKD 7.7806 +0.0034 (0.04%)
USD/CNY 6.6270 -0.0180 (-0.27%)
AUD/USD 1.0043 +0.0016 (0.16%)
____________________________________________________________
WORLD MARKETS SNAPSHOT:
(FRIDAY, DEC. 24, 2010 12:30 PM EST)
Shanghai 2,835.16 -20.06 (-0.70%)
Nikkei 225 10,279.19 -67.29 (-0.65%)
Hang Seng Index 22,833.80 -69.17 (-0.30%)
TSEC 8,861.10 -37.77 (-0.42%)
FTSE 100 6,008.92 +12.85 (0.21%)
DJ EURO STOXX 50 2,861.94 -7.69 (-0.27%)
CAC 40 3,900.39 -10.93 (-0.28%)
S&P TSX 13,390.57 +19.37 (0.14%)
S&P/ASX 200 4,777.30 -21.70 (-0.45%)
BSE Sensex 20,073.66 +90.78 (0.45%)
____________________________________________________________
THURSDAY'S U.S. ECONOMIC CALENDAR:
Nov Advance Report on Durable Goods Total Orders (expected -0.6%), Orders, Ex-Defense (previous -2.1%), Orders, Ex-Transportation (previous -2.7%)
8:30 a.m.
Dec 18 Unemployment Insurance Claims Report - Initial Claims Weekly Jobless Claims (expected 418K), Net Change (expected -2K), Cont Jobless Claims (prior week) (previous 4135000), Net Chg (prior week) (previous +22K)
8:30 a.m.
Nov Personal Income & Outlays Personal Income (expected +0.2%), Personal Spending (expected +0.5%), PCE Price Index Monthly (previous +0.2%), Yearly (previous +1.3%), PCE Core Price Index Monthly (expected +0.1%), Yearly (previous +0.9%)
9:55 a.m.
Dec Thomson Reuters / University of Michigan Survey of Consumers - final Sentiment Index End month (expected 74.5), Expectations Index End Month (previous 64.8), 12-Month Inflation Forecast (previous 3), 5-Year Inflation Forecast (previous 2.8), Value (Current Period) End Month (previous 82.1)
10:00 a.m.
Nov New Residential Sales Overall Sales (expected 300K), Percent Change (expected +6%)
10:00 a.m.
DJ-BTMU Business Barometer (previous -0.7%), (52 Wk) (previous +4.4%)
10:30 a.m.
Dec 17 EIA Natural Gas Storage Report Total Working Gas in Storage (previous 3561B), (Net Change) (previous -164B)
4:30 p.m.
Dec 22 Federal Discount Window Borrowings Primary Credit Borrowings (previous 21M), W/E Daily Avg (previous 22M), Discount Window Borrowings (previous 45.75B), W/E Daily Avg (previous 45.22B)
4:30 p.m.
Dec 22 Foreign Central Bank Holdings Foreign US Debt Holdings (previous 3.34T), US Foreign Agency Holdings (previous 728.47B), Foreign Treasury Holdings (previous 2.61T)
4:30 p.m.
Dec 13 Money Stock Measures
MARKET NOTES: The bond market will close early Thursday and be closed Friday for the Christmas holiday in the U.S.
ECONOMIC REPORTS:
Wednesday provides the latest estimate on third-quarter gross domestic product, November's existing home sales, and the weekly report on U.S. petroleum supplies. The Commerce Department will report on personal income and spending, durable goods orders, and new home sales for November on Thursday.
The U.S. market will be closed for the Christmas holiday on Friday.
____________________________________________________________
US STOCK MARKET SUMMARY, WED., DEC.22, 2010:
Stocks: New York indexes finished higher, with the Dow Jones Industrial Average ending up 26.33 points, or 0.23%, to 11559.49 and the Nasdaq composite index rising 3.87 points, or 0.15%, to 2671.48. The broader Standard & Poor's 500-stock index finished up 4.24 points, or 0.34%, at 1258.84. Financials led the climb as investor sentiment toward the sector continued to improve following recent deal activity.
Treasurys:Treasurys prices dropped after the Federal Reserve completed its last bond purchase of the week and as investors anticipated stronger data and year-end Treasury note auctions. Prices fell after the Fed bought $2.5 billion in Treasurys maturing in the next 11 to 17 years, mimicking a pattern the market has followed all week.
Forex: The Swiss franc rose broadly, hitting a record high against the euro as investors continued to seek safety from the euro zone's sovereign-debt crisis. The euro was more or less flat against the dollar, just under $1.31.
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