Reports

World stock markets news summary (US, UK, Europe, Asia) (September 10, 2010)

Contributed by Paddy Power Trader

By Paddy Power Trader

OECD says UK will be fastest growing G7 country in Q3. (Telegraph) The OECD upgraded its UK forecast to 0.7% growth in the third quarter,  compared with the second, from an earlier forecast in May of 0.5%. That would be slower than the 1.2% growth achieved in the UK in the second quarter, according to Office for National Statistics figures, but stronger compared with the OECD’s forecasts for the US, Japan, Germany, France, Italy and Canada.

UK News

UK finance minister Osborne says to cut a further GBP 4bln from Welfare bill. (BBC/RTRS)

Osborne says cuts to be on top of GBP 11bln announced in June and says ‘further’ UK welfare cuts to come Oct. 20. Says to target jobless benefits in spending review.

UK house prices rose to a six-month high in August as demand from cash buyers spurred purchases in London, according to Acadametrics Ltd. (Sources) The average price of a home in England and Wales rose 0.2% from July to GBP

222,454, the research group said. Values were up 7.7% from a year earlier.

US News

T-notes finished lower as risk appetite increased due to reduced Eurozone fears resulting from successful Irish T-bill auctions. Better than expected US economic data put further pressure on treasuries which touched on lows following

tepid demand for the 30y note auction. At the close; t-notes finished down 26 ticks at 123.20.

Fed’s Bullard says economy will pick up again in H1 2011 and says Fed still has policy options ‘if needed’. (CNBC) Bullard says if Fed needs to ease further, would probably be buying longer-dated treasuries.

Foreign central banks’ holdings of the US Treasuries and agencies securities at the Federal Reserve fell in the latest week, according to the Fed. (RTRS) The Fed said its holdings of Treasuries and agency debt kept for overseas central

banks fell USD 11.03bln in the week ended Sept. 8, to stand at USD 3.214trl.

USD 13bln 30y note auction received a b/c 2.73 vs. Avg. 2.58 (Prev. 2.77) and Indirects were 36.1% vs. Avg. 35.72% (Prev. 45.91%). The auction drew a yield of 3.820% vs. Exp. 3.806% with a total of 59.64% of issuance was allotted at

the high. (RTRS)

European News

ECB’s Trichet says as markets gradually stabilise, non-standard measures will continue to be progressively phased out. (FT/RTRS/Sources) Trichet says does not see materialisation of a risk of deflation or inflation at present, says mood

on US economy seems too negative.

Spain’s Ordonez says essential for country’s government to meet deficit cutting objectives. (RTRS) Ordonez says Basel III implies high cost for global financial system and economy if strictly implemented and says still sees major

problems in global financial markets and banking systems. Says Spain’s banks will be less affected by Basel III than banks in other countries and Spain’s banking system needs to strengthen capital and create liquidity cushions. In

addition, says some banks still have work to do on managing assets.

EU’ financial services commissioner, Barnier, said that he wants agreement on a new system of financial regulation by the end of 2011. (La Tribune)

Asian News

Lead December 10-year Japanese government bond futures inched lower overnight, taking in their stride news that a small, unlisted bank was expected to file for bankruptcy protection. JGBs were trading at 141.34 (-0.28) at 0627 BST.

(RTRS)

Many Bank of Japan board members said the JPY’s rise might hurt exports and corporate revenues, according to the minutes of the central bank’s Aug. 9th-10th policy meeting. (RTRS) However, one member said current JPY levels

might be sustained. Many members said the BOJ need to watch JPY rise impact on sentiment, and JPY rise might prompt firms to shift output abroad. Some members also said Japanese economic recovery might briefly slow, and one

member said inflation expectations might decline on global deflation worries.

Japan said on Friday it hoped the BOJ would take further steps to beat deflation as the government, struggling from a surging JPY and deflation, finalised a JPY 915bln economic package. (RTRS) The government also said in a statement

on economic steps that it would take decisive measures including currency intervention when needed, as the strong JPY threatens to derail the country’s fragile economic recovery. The Japanese government kept the economic

assessment unchanged, and said the economy is picking up, with move towards self-sustaining recover is seen. Also Japanese finance minister Noda said that the government will flexibly respond on economy, and mull extra budget if

needed. He added that the GDP data confirmed steady economic recovery in Q2. He also said that he expects BOJ to take timely and appropriate steps on monetary policy.

Japanese PM Kan has slight edge over powerbroker Ozawa ahead of a party leadership vote next week, but with many party lawmakers undecided the outcome is too close to call, according to NHK public TV. (RTRS)

Japanese GDP (Q2 F) Q/Q 0.4% vs. Exp. 0.4% (Prev. 0.1%) Japanese GDP Annualised (Q2 F) Y/Y 1.5% vs. Exp. 1.5% (Prev. 0.4%)

Japanese Nominal GDP (Q2 F) Q/Q -0.6% vs. Exp. -0.6% (Prev. -0.9%) Japanese GDP Deflator (Q2 F) Y/Y -1.7% vs. Exp. -1.8% (Prev. -1.8%) (RTRS)

Chinese Trade Balance (USD) (Aug) Y/Y 20.03bln vs. Exp. 26.90bln (Prev. 28.73bln) Chinese Exports (Aug) Y/Y 34.4% vs. Exp. 35.0% (Prev. 38.1%)

Chinese Imports (Aug) Y/Y 35.2% vs. Exp. 27.5% (Prev. 22.7%) (RTRS)

Forex

ECB’s Trichet says confident EUR will survive crisis. (Sources)

Canadian finance minister Flaherty says will cut overall deficit by one half by 2011-12 and by two-thirds by 2012-13. (RTRS) Flaherty reiterates Canada plans to end stimulus next year and says is concerned about weakness in exports.

Commodities

US crude for October jumped to near USD 75 a barrel overnight after a leak forced Enbridge to shut down the biggest pipeline supplying Canadian oil to refineries in the Midwest and to a key storage hub in Oklahoma. WTI crude futures

were trading at USD 74.87, up USD 0.63, at 0627 BST. (RTRS)

The IMF, which set out a year ago to sell about 13% of its Gold holdings, sold 10 metric tonnes to Bangladesh for USD 403mln.. The transaction brings total central bank purchases from the fund to 222 tonnes, according to fund data.

(Sources)

Company News

Vodafone – Co. has signalled that it could dispose of more of its minority stakes after Vittorio Colao, Chief Executive, took personal charge of all the shareholdings. (FT)

UK

BP – Co. says its Q3 2010 results will be released on Tuesday 2nd November, one week later than previously indicated. (RTRS)

RBS – Co. will consider an IPO for its insurance arm as well as a conventional sale process. (Sources)

Tullow Oil – Uganda withdrew an oil exploration license from co., citing the Energy Ministry. (Sources)

Old Mutual – Co. has made a preliminary offer for 80.1% of Fideuram Vita, the life assurance unit of Intesa Sanpaolo, with the stake valued at EUR 400mln, according to sources. (La Stampa)

Companies paying Dividend: BG group (USD 0.0982), Carnival (USD 0.1000), Barclays (GBP 0.0100)

Mitchells & Butlers – Co. sees whispers of move for Punch Taverns’ restaurants, according to a market report. (Daily Express)

US

Equities finished in positive territory though off their best levels as participants noted that the encouraging claims data may have been skewed after nine states did not file their numbers as a result of the Labour Day holiday. In the latter half

of the session, there were reports that Deutsche Bank (ADR -3.18%) was considering a EUR 9bln share sale which also slightly weighed on sentiment. In addition, there were some strong gains for Adobe (12.11%) after Apple (0.06%)

relaxed restrictions placed on App developers. Elsewhere, there were reports that Sanofi-Aventis were to raise their bid for Genzyme (+0.23%) to USD 75/share. Overall, it was a quiet end to the session and the S&P closed up 0.49% at

1104.21, the DJIA closed up 0.27% at 10415.16, and the NASDAQ 100 closed up 0.33% at 1886.14.

National Semiconductor – Q1 EPS USD 0.36 vs. Exp. USD 0.36 and Q1 revenue USD 412mln vs. Exp. USD 414.5mln. (RTRS)

Texas Instruments – Co. said Q3 share seen at USD 0.66 vs Exp. USD 0.69 in its business outlook update. Co. sees Q3 sales at USD 3.62bln – USD 3.78bln against the co.’s prior view of USD 3.55bln – USD 3.85bln and street estimate of USD 3.69bln.

Bristol-Myers Squibbs – Britain’s healthcare watchdog said it was unable to recommend use co.’s schizophrenia drug Abilify in children aged 15 to 17 and has asked for more information on its effectiveness. (RTRS)

Europe

Sanofi-Aventis – Co. could possibly raise its bid for Genzyme to USD 75 per share, according to sources. (Sources)

GDF Suez – Co. confirms that it is selling its entire 5.01% stake in Gas Natural worth about EUR 560mln. (Sources)

AXA – Australian wealth manager AMP is likely to wait until rival National Australian Bank is completely out of the running before making another attempt to take over Axa Asia Pacific, two sources said. (RTRS)

Peugeot Citroen – Co. says it will make today early repayment of EUR 1bln of the French State loan, and reimbursement will be made out of existing liquidity resources. (RTRS)

Renault – Co. says it will make today early repayment of EUR 1bln of the French State loan, and will reduce debt and financial costs. (RTRS)

Deutsche Bank – Co. is poised to raise EUR 8bln – EUR 9bln of new equity strengthen its capital ratios in line with tougher rules due to be finalised this weekend. According to people close to the plan, co. aims to announce the offering

on Monday or Tuesday. (FT)

Deutsche Postbank – Co. is likely to be taken over by Deutsche Bank, according to co.’s chief executive. (Handelsblatt)

Thyssenkrupp – Co. may sell its car parts businesses Presta, Bilstein and Drauz Nothelfer, according to sources. Also, the co. wants to sell its subsidiary Fahrzeugtechnik, according to sources. (Handelsblatt)

Beiersdorf – Co. is a subject of takeover speculation, according to sources. (Sueddeutsche Zeitung)

Novartis – Co. announces Russian regulatory approval for Gilenya, a one daily oral multiple sclerosis therapy and first in a new class. (Sources)

ABB – Co. says demand trends seen in Q2 remain unchanged, co. say that their cost savings program remains on track to deliver USD 3bln in cost reductions by the end of 2010. (RTRS)

European Companies – Companies could face sharply higher costs for short-term borrowing including revolving credit and commercial paper, under the banking reform global regulators meeting this weekend in Basel. (FT)

Spanish Banks – Spain’s Ordonez says Spain’s banks will be less affected by Basel III than banks in other countries and say Spain’s banking system needs to strengthen capital and create liquidity cushions. In addition, says some banks

still have work to do on managing assets. (RTRS/Sources)

Nokia – Co. named Stephen Elop as its CEO, replacing Olli-Pekka Kallasvuo. Elop is currently head of Microsoft’s business unit. (Sources)

UniCredit – Co. plans to close 230 branches in its domestic market by 2013 as part of its reorganisation plan, a trade union source said. (RTRS)

Intesa Sanpaolo – Old Mutual has made a preliminary offer for 80.1% of Fideuram Vita, the life assurance unit of co., with the stake valued at EUR 400mln, according to sources. (La Stampa)

Aegon – Co. is waiting for regulatory changes to India’s foreign investment cap in order to raise its ownership in the Indian life insurance joint venture Aegon Religare Life Insurance. Co.’s CEO says that the co. is planning to invest an

estimated EUR 100mln in the joint venture by 2016. (Business Line – India)