European Indexes Weak; UK Home Prices Drop

Arthi Gupta
27 Dec, 2010
New York City

The European indexes declined tracking weak world markets. The Swiss National Bank forecasted slow growth in 2011. The UK home prices fell in December. Rating agencies lowered views on Portugal debt and reaffirmed French debt rating.

[R]4:00 PM Frankfurt – The European indexes declined tracking weak world markets. The Swiss National Bank forecasted slow growth in 2011. The UK home prices fell in December. Rating agencies lowered views on Portugal debt and reaffirmed French debt rating.[/R]

U.S. stocks declined and Asian markets traded mixed.

The People''s Bank of China on Saturday revised upwards its benchmark 1-year deposit and lending rates by 25 basis points each to 2.75% and 5.81% respectively.

China''s Commerce Minister Chen Deming reportedly said on Friday that Europe''s €750 billion rescue fund and bond sales are ""turning an acute disease into a chronic one.""

According to a report published in the Shanghai Securities News, Chen cast doubt on Europe''s quick recovery from the debt crisis.

Beijing municipal government decided to limit the issue of new vehicle license at 240,000 next year. The latest move will cut new car registrations in 2011 to near one-third of this year''s sales to ease a growing traffic in the center of the city.

According to new rules, vehicles that are registered outside Beijing will have to apply for a permit to enter the Chinese capital.

Snow blizzard has swept the U.S. from North Carolina to Massachusetts and residents are bracing for more than 15 inches of snow. Millions of commuters are bracing difficult travel conditions. Traffic at New York airports is halted.

In Paris CAC 40 Index declined 55.36 or 1.42% to close at 3,845.03 and in Frankfurt DAX Index edged lower 102.53 or 1.45% to close at 6,955.16.

France Debt Ratings Affirmed

Standard & Poor''s on Thursday affirmed sovereign ratings of France, citing the strength of the economy and its stable political environment.

The agency affirmed ''AAA'' long-term and ''A-1+'' short-term sovereign credit ratings on the Republic of France. The outlook remained stable.

The rating agency forecasts a general government deficit of 7.7% of GDP in 2010, declining to just below 6.2% in 2011.

Portugal Debt Ratings Lowered

Fitch Ratings on Thursday downgraded Portugal''s sovereign ratings citing slower reduction in the current account deficit and difficult financing environment.

The long-term foreign and local currency Issuer Default Ratings were lowered to ''A+'' from ''AA-'' and Short-term foreign currency rating to ''F1'' from ''F1+''. The outlooks on the long-term IDRs are negative.

Euro Area Leading Index Rises

The euro-zone''s leading economic indicator rose 0.7% on a monthly basis in November following a 0.3% increase in October, the Conference Board said on Monday. The coincident index - a measure of current conditions - declined 0.1% in November.

French Jobseekers Up

The number of registered job seekers in France rose 0.8%, or 21,300, on a monthly basis to 2.7 million in November, data released by the country''s Labor Ministry showed on Friday. Compared to last year, the increase was 2%.

SNB Forecasts Slow Growth

Switzerland''s economic growth is set to continue in the months ahead, the Swiss National Bank said in its quarterly bulletin on Friday. But growth is likely to be significantly lower due to generally subdued economic activity in the industrialized nations and the appreciation of the Swiss franc.

The central bank expects GDP to grow by around 1.5% in 2011, following growth of about 2.5% in the current year.

UK Home Prices Drop; Retailers Forecast Drop in Sales

Home prices in England and Wales fell for a sixth month in a row in December as demand continued to slump, a new survey showed on Monday.

The average cost of a home fell 0.4% in December, following a 0.8% decrease in November, property intelligence group Hometrack said.

Home prices in England and Wales fell 1.6% in 2010, Hometrack said. The group added that further price falls of 2% in 2011 were likely given poor demand and the government''s spending cuts.

A majority of British retailers forecast a fall in sales next year, according to the British Retail Consortium.

Nearly two-third of retailers responding to the British Retail Consortium''s Retail Prospects for 2011 snapshot survey, showed that they expect retail sales to worsen compared with 2010. About 18% expect an improvement.

The survey found that 47% of retailers expect to create jobs in 2011, while 24% expect to employ fewer people.

Czech Consumer Confidence Improves

Czech consumer confidence improved for a second consecutive month in December, survey results showed Monday.

The seasonally adjusted consumer confidence indicator rose to 92.8 in December from 90.2 in November, data from the Czech Statistics Office showed. A year earlier, the confidence indicator was at 95.3.

Dutch Producer Confidence Surges

Dutch manufacturers'' sentiment improved notably in December, the Central Bureau of Statistics said. The producer confidence index surged to 2.5 in December, from 0.3 in November.

Greek Trade Deficit Contracts

Greece''s trade deficit narrowed to €1.43 billion in October from €2.34 billion shortfall a year ago, according to data released by the Hellenic Statistics Authority.

Total value of exports increased 24.6% annually to €1.59 billion and the total value of imports was €3.02 billion in October.

G4S Acquires Munt Centrale Holland B.V.

G4S Cash Solutions B.V., the leading cash solutions provider in the Netherlands entered into an agreement to acquire MCH from PCH Holding B.V. for a cash consideration of €7.9 million.

MCH will allow G4S to enhance its cash solutions strategy by offering an additional capability through the provision of integrated coin services.

Gainers & Losers

Exiqon A/S gained 0.56% to DKK 8.95 after the Denmark-based company active in the pharmaceutical industry introduced Good Laboratory Practice or GLP compliant services for miRNA biomarker screening and diagnostic assay development for clinical trials.

HSBC Holdings Inc fell 0.10% to 667.30 pence after the global banking and financial services company said that it will no longer provide refund anticipation loans or refund anticipation checks to clients of H&R Block Inc, as a result of a U.S. regulatory directive by the Office of the Comptroller of the Currency.

JJB Sports Plc surged 24.19% to 5.34 pence after the sports retailer reached agreements in principle with each of its proposed investors to raise at least £31.5 million or $48.7 million in a share sale, as the UK''s snowy weather condition significantly affected its sales.