December 5th, 2011 by admin

On Tuesday, investors fled global stocks as poor growth figures reinforced how difficult it would be for European countries to reduce their debt piles and balance their budgets.

Economists said the eurozone could slip back into recession in coming months after seventeen countries using euro eked out just 0.2 percent growth in the third quarter.

From in.news.yahoo.com:

While Tuesday’s growth figures did not include estimates for Greece and Italy, they clearly increased investors’ concerns about those countries. Both desperately need growth to pull out their crises.

The bad news pushed European shares and the euro down for the second day. In France, the CAC-40 fell 1.8 percent to 3,054, while Germany’s DAX retreated the same amount to 5,875. The FTSE index of leading British shares was down 1.0 percent at 5,465.33.

Borrowing rates rose worryingly, with Italy’s benchmark 10-year rate back over 7 percent and Spain’s up to 6.22 percent. Even the yield of France — considered one of Europe’s core growth engines — was edging up, touching 3.60 percent.

“This is an extremely worrying time for Europe as contagion is starting to become a very real possibility,” said Simon Furlong, a trader with Spreadex. “The stark reality (is) that there could very possibly be a Domino effect in Europe.”

Tags: borrowing rates, global stocks, recession

November 26th, 2011 by admin

On Friday, oil prices hovered above $96 a barrel in Asia as Europe’s debt crisis undermined confidence the continent will avoid recession next year.

Benchmark crude for January delivery was up 29 cents at $96.46 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange.

From in.finance.yahoo.com:

Brent crude for January delivery rose 73 cents at $107.77 a barrel on the ICE Futures Exchange in London.

Markets close early in the U.S. on Friday for Thanksgiving.

Investor concern that fiscal austerity measures to lower Europe’s debt levels will hurt global economic growth and oil demand has helped pull crude back from above $103 last week.

Credit ratings agency Fitch downgraded Portugal’s long-term debt rating to BB+ from BBB-, following a similar move recently by Moody’s.

Markets in the U.S. were closed Thursday for the Thanksgiving holiday.

Tags: benchmark crude, Brent crude, debt crisis, oil prices, recession

October 18th, 2011 by admin

According to General Electric Co’s Jeff Immelt and other top executives, the U.S. economy is not slipping back into recession but will face a long, slow recovery as political gridlock in Washington and Europe make businesses wary of investing.

“Recovery is underway, but it’s a long, slow recovery. Slower than we’d like,” the head of GE told a group of about 500 executives from mid-sized U.S. companies.

From in.finance.yahoo.com:

Other top voices from corporate America offered a similar assessment on Thursday, including FedEx Corp CEO Fred Smith and ExxonMobil Corp’s Rex Tillerson.

Data released on Thursday is backing them up: Activity in manufacturing, business spending and motor vehicle sales suggested that the economy, which expanded at a 1.3 percent annual rate in the second quarter, could avoid an outright decline in output.

“We don’t see a contraction; we don’t see a recession,” said FedEx’s Smith, who founded the world’s No. 2 package delivery company. “It’s steady as you go, slow growth.”

“This is a lot different than 2008, guys,” said Immelt, CEO of the largest U.S. conglomerate. “There’s liquidity, there’s pockets of growth and I think people have confidence that they might be able to find the right pockets of growth.”

Tags: business spending, recession

October 15th, 2011 by admin

According to a recently released U.S. government report, employment grew more than expected in September and job gains for the prior months were revised higher that could ease fears the economy was heading into recession.

The Labor Department said nonfarm payrolls rose 103,000, while the unemployment rate held steady at 9.1 percent as an increase in household employment offset a rise in the participation rate.

From in.finance.yahoo.com:

Part of September’s relative strength reflected the return of 45,000 Verizon Communications workers who had dropped off payrolls in August due to a strike. Excluding those workers, payrolls increased by 58,000.

The tenor of the report was strengthened by revisions that showed 99,000 more jobs added in July and August than initially reported. In addition, hourly earnings rebounded and the average work week rose.

Economists had expected nonfarm employment to increase 60,000 last month and the jobless rate to hold steady at 9.1 percent.

The government’s closely followed employment report was another sign that the world’s largest economy was likely to skirt a recession despite weakness over the summer.

Private employment increased 137,000 last month, which is acceleration from August’s meager 42,000 count.

Tags: government report, nonfarm payrolls, recession

September 22nd, 2011 by admin

The U.S. Federal Reserve, which is running out of options, is now thinking to give a boost to the country’s economy and reduce unemployment.

The Fed is now expected to announce money shifting in its $1.7 trillion portfolio out of short-term securities and into longer-term holdings.

From news.yahoo.com:

Fed Chairman Ben Bernanke is expected to advocate the move despite criticism from within the Fed and from Republican lawmakers and presidential candidates.

On Monday, the four highest-ranking Republicans in Congress sent Bernanke a letter cautioning the Fed against taking further steps to lower interest rates. Their letter suggested that lower rates could escalate the risk of high inflation.

The plan the Fed is considered most likely to unveil Wednesday has been dubbed “Operation Twist” and dates to the early 1960s. The Fed used a similar program then to “twist” long-term rates lower relative to short-term rates.

Most economists now say the odds of another recession are about one in three.

Tags: Federal Reserve, inflation, interest rates, recession, unemployment

August 8th, 2011 by admin

The United States dollar is expected to fall next week, especially against the Japanese Yen (JPY) and Swiss Franc (CHF) as investors are looking to a Federal Reserve meeting that may offer hints of further easing as worries about the global economy grow.

Stocks sold off and safe-haven assets soared this week after weak data fueled fears that the world economy is slipping back into a recession.

From Reuters.com:

The Swiss franc climbed to record highs against the dollar and euro on Friday, before easing back. The dollar last traded up 0.2 percent at 0.7665 franc, while the euro rose 1.5 percent at 1.0960 francs.

For the week, the dollar lost about 3.0 percent against the Swiss currency and the euro dropped 3.7 percent.

Against the yen, the dollar was last at 78.49, down 0.7 percent on the day, but rose 1.2 percent on the week after Japan intervened and eased monetary policy to weaken the yen.

Sharp moves in financial markets and the spike in volatility prompted aggressive policy actions by several major central banks in recent days, including a surprise interest rate cut by Switzerland, yen-selling intervention by Japan, and a resumption of bond buying by the European Central Bank.

“With markets already on the defensive and the macroeconomic picture deteriorating, (Fed Chairman Ben) Bernanke cannot afford to be tight-lipped about further quantitative easing,” said Ashraf Laidi, CEO of Intermarket Strategy Ltd. in London.

Tags: Federal Reserve, financial markets, quantitative easing, recession

August 5th, 2011 by admin

A massive £35billion was wiped off the value of the biggest companies in Britain on 3rd August, 2011 as the global economy sunk deeper into crisis.

The American debt storm blew back across the Atlantic to Europe and threatened to engulf Italy and Spain.

From Dailymail.co.uk:

Panicked investors were also rattled by signs of a severe slowdown in the United States, the world’s biggest economy, as it edged closer to a double-dip recession.

In New York, the Dow Jones index of American stocks recovered only slightly after falling for eight straight days.

The loss of confidence on financial markets threatens to destroy momentum in the world economy and send unemployment soaring. A renewed global slump would be devastating for Britain and could tip the economy back into recession.

The FTSE 100 index tumbled 133.88 points to 5584.51– slashing the value of Britain’s blue chip companies by £35billion. It is the worst fall for nine months.

Louise Cooper, an analyst at broker BGC Partners in London, said: ‘Everybody is phenomenally nervous. There is a lot of fear out there.’

Tags: American stocks, Dow Jones index, financial markets. FTSE 100, global economy, recession

September 3rd, 2010 by admin

Fears of the US economy facing a double-dip recession were expressed after pending sales of previously owned US homes rebounded unexpectedly in July and new claims for jobless benefits fell last week.

The data released recently including sturdy sales from retailers in the US last month followed a report displaying a surprising gain in manufacturing and suggesting that the US economy has been able to retain some underlying strength.

From in.news.yahoo.com:

This is an economy that has hit a soft patch. It’s not an economy that appears to be heading towards a double-dip recession,” said Brian Levitt, an economist at OppenheimerFunds in New York.

Investors appeared to agree that fears of a double-dip recession might have been overdone as they sold U.S. government debt for a second straight day and bought stocks. The broad Standard & Poor’s 500 Index ended up 0.91 percent.

The National Association of Realtors’ Pending Home Sales Index, based on contracts signed, rose 5.2 percent in July from June. Analysts had expected the index, which leads actual sales by a month or two, to fall 1 percent.

Home sales have dropped sharply since a popular tax credit for home buyers ended in April and the surprise gain in pending sales raised hopes the sector could soon stabilize.

The minutes of the U.S. central bank’s last policy meeting showed that some policymakers believe that the outlook would have to deteriorate “appreciably” to spur fresh monetary support.

Tags: Home sales, recession, stocks, tax credit

August 20th, 2010 by admin

It will take a few years to dig the United States out of the recession, a campaigning President Barack Obama said this Tuesday.

Obama is eager to put a human face on his contention that the US is bouncing back, thanks to resilient success stories and help by the government. But the president is expected to have a tough time with millions of people out of work and economic growth still on the slower side.

From Timesofindia.indiatimes.com:

The president’s economic outlook, coming in the heat of a divisive congressional campaign, reflected his tricky political reality. He must try to persuade people soured by the sagging economy that they should re-elect Democratic leaders now, but he also is laboring to get voters to measure his efforts with a long view, as he looks ahead to his own re-election campaign in 2012.

Darting into Seattle to stir up enthusiasm and cash for Democratic Sen. Patty Murray, Obama spoke as a president whose agenda is on the line. He has pushed through all his big legislative items with virtually no Republican backing.

Obama’s heavy fundraising tour, touching just about every region of the country in three days, underscores the stakes of the November election. It is one that will be seen as a referendum on Obama and on Democratic control of Congress.

Obama said that 8 million jobs will be brought back in the next few years to take the US fully out of the recession.

Tags: Barack Obama, economic growth, economic outlook, Obama, recession

June 21st, 2010 by admin

New figures have suggested that online shopping has been able to reach its highest growth in the last two years, thanks to warm weather and the FIFA World Cup.

According to the IMRG Capgemini e-Retail Sales Index, online shopping registered the highest growth since June 2008 as total online sales were up 22 percent in the month of May 2010 as compared to total online sales in the month of May 2009.

From Channel4.com:

Preparations for the World Cup appear to have played their part, with alcohol sales up 23% compared to last year and electrical goods up 13%.

Online clothing sales rose in May, up 32% compared to last year, fuelled by sportswear buying and warmer temperatures.

Capgemini spokesman Chris Webster said: “Throughout the history of the index we have seen a noticeable rise in sales of certain goods whenever there is a major sports tournament on.

“This year’s World Cup is no exception, with online retail as a whole growing by the highest level in two years and sectors such as clothing, alcohol and electricals rising especially rapidly. It’s good to see that consumers’ spirits haven’t been dampened by concerns over Government spending cuts, and savvy retailers will have embraced the opportunity to draw in new customers with marketing and price incentives.”

IMRG spokeswoman Tina Spooner said: “With online sales growing at their highest rate in almost two years, this is good news for the e-retail industry. The fine weather in late May, together with the build up for the World Cup, appears to have had a positive impact for e-retailers.

E-retailers have already started to benefit from an increase in consumer spending, which is stimulated primarily by the fact that the UK economy is now recovering from the recession.

Tags: consumer spending, FIFA World Cup, Online clothing, online retail, online sales, Online Shopping, recession, total online sales, World Cup