Category Archives: European Finances

Greece can emit 50-year bonds under European pressure

Government BondsGreece announced that it was examining technical issues relating to the issuance of 50 -year bonds to further restructuring of its debt and make it more sustainable. This surprised many, since the country has no access to global capital markets in 2010, but powerful interests can make this happen. Recently, Finance Minister of Greece Ioannis Sturnaras said: “I hope that we will have 50-year bond. This means that our debt will be significantly reduced along for 50 years”. In 2013, Greece will have a gross public debt of around 322 billion euros, or more than 175% of GDP, which is anything but not controlled. The country may need another injection of 10 billion euros to finance between mid- 2014 and end of 2016.
The idea of ​​Greek debt to be sustainable by 2022 stopped the Greek parliamentary Supervisor’s budget through a rare recognition. They say: “It is unrealistic to believe that Greece will be able to return to financial markets as early as 2014 and that debt will require further cut to be sustainable”. Greece received 240 billion EUR in rescue two tranches. Country seeks ways to replace and increase the duration of bilateral loans worth between 53 billion to 110 billion EUR of 50-year bonds. Of course, such a move would be directed against the partial derecognition because the mere extension of bilateral loans and lower interest rates will not be sufficient to public debt repayable. The local population has reached the bottom and can not tolerate or pay more taxes, nor to accept future reductions in salaries and pensions as conditions recently tagged IMF chief Christine Lagarde.

European financial markets are staying stable

European investorsAhead a few weeks of calm in European financial front. Nobody wants to rock the boat further with regard to the impending Greek debt restructuring before the German elections on 22nd September 2013. Without doubt, however, like in Shakespearean tragedy, we will witness the breathtaking twists in the coming months. It is clear that answering the question “Who is to blame for the problem situation in the European Union (EU)?” is of secondary importance amid the ongoing recession and record unemployment, especially in the southern part of the continent. Sooner or later, however, the EU will have to examine the reasons for the failures and ask whether the necessary corrective measures could be taken earlier. The problems of the Eurozone to be placed in the context of transatlantic financial crisis. An important element is the inability to control the risk in lending made by participants in the financial markets almost everywhere. Undoubtedly, the main responsibility for the poor state of the bloc’s debtors. However, Member creditor does not stop with reckless lending. Although nominal exchange rates within Europe are stable as previous national currencies to the EUR were closed, real exchange rates deviated significantly since 1999, real interest rates also missed greatly. Determination of exchange rates in Europe is irresistible invitation for unstable countries to live well beyond their capabilities. Invitation which they accepted willingly and without inhibitions.

European indexes are in technical correction

EU IndexesThe European shares fell because of continuing concerns about the reduction of monetary stimulus from the Fed and the fears associated with reduced bank liquidity in China. The pan-European FTSEurofirst 300 index fell 1.5% to 1,115 points – this is the lowest closing index of 29 November. This year it is down 1.6%.
The British FTSE-100 fell 1.3% to 6,035 points, the German DAX was down 1% to 7,709 points, while France’s CAC 40 lost 1.4% to 3,608 points. Three indexes are already in technical correction after having fallen by over 10% from its May highs. By the Bank for International Settlements said over the weekend that it is time for central banks to stop their programs for the purchase of bonds, which just won time for politicians. The shares of the largest cable operator Kabel Deutschland in Germany rose 1.8% after the British mobile operator Vodafone today confirmed that it has decided to make an offer for the purchase of 7.7 billion EUR.
The Fiat’s shares rose 3.1%, due to information that will blend with your state’s division of Chrysler, which will allow both companies to issue common shares.

Decreases in European markets

Euro areaThe European stocks fell, ending near daily lows, despite better-than-expected data on industrial production in the EUR as investors cashing profits. The common European FTSEurofirst 300 Index fell 0.6%, as investors remained nervous about the concerns that the Federal Reserve will begin to shrink the monetary stimulus. The British FTSE 100 lost 0.9% to 6,525 points, the German DAX index fell 0.8% to 8,286 points, while French CAC 40 slid 0.7% to 3,921 points. “I think that the overvaluation of the market nearing its end. Time to cash in profits”, said Ronnie Chorpa, strategist at Tradenext.
The Istanbul Stock Exchange plunged by 10.5% as investors reacted with concern the anti-government protests continue for four days. In comments that are likely to reduce expectations of further declines in interest rates in the Eurozone during tomorrow’s meeting of the ECB Bank President Mario Draghi said the economy of the monetary union is about to recover later in the year.

Sharp decrease in the Istanbul stock exchange because of the protests

BIST declineThe Istanbul Stock Exchange Borsa Istanbul (BIST) began the first week of June with a sharp drop as investors reacted negatively to the several protests against some of the policies of the central government led by Recep Tayyip Erdogan. The index Borsa Istanbul National 100 index fell by 6.43% to 79,047 points from 80,463 points on Friday. Turkish currency in turn retreated to 1.891 liras against the USD, reaching close to 18-month low against the USD. The sharp decline reflected the most sensitive index of banking in the country, which at the opening on Monday fell by 7.53%. Despite the slight increase in consequence indicator still remained in the red with 4.8%. Banking stocks, which suffered the greatest shock were those of private Garanti Bank and state Halkbank, which fell by 5.15 and 4.23 per cent.
“Panic on the market causes irrational pricing. Domestic and foreign investors who do not want to take unnecessary risks tend to sell their existing assets immediately”, told the head of the Istanbul Stock Exchange. The protests in Istanbul, which entered today in its seventh day continued with the use by police of tear gas against demonstrators, the main clashes took place in Istanbul’s Besiktas. Many civilians and students headed to their jobs and schools were affected by the actions of the police, communications agency Xinhua.

European stock exchanges did not find a single direction

EU IndexesThe main indexes of the leading European stock markets moved in mixed end of today’s trade. In Paris the CAC 40 added 0.22% nas investors piled up gains after the appreciation of the shares in a while without their influence the better than expected data on retail sales in the US Trade flows there remains weak – 2.119 billion EUR.
London’s FTSE-100 rose 0.10 percent, Zurich SMI fell 30.17 points to 8,147.68 points and in Frankfurt DAX catch up at the last minute and reported once, even a modest increase of 0.01% to 8 279.29 points.
The retail sales in the US unexpectedly rose in April, while 0.1% minimum by purchases of automobiles and construction materials show hidden power in the country’s economy. The decline in March but has been adjusted in the direction of further decline to 0.5% after the initial announcement contraction of 0.4%. Surprisingly weak Chinese industrial production darkened the mood of investors. He grew up in April compared with the same month last year by 9.3% but analysts predicted an average growth of 9.5%.

Uncertainty returned on the European markets

European indexesSeveral factors of uncertainty burdensome European stock markets on Monday. In China, the service sector is not able to move, and reducing government spending in USA has fueled the negative sentiment, the dealer said Sarah Brileuski by Gekko Markets. Italy also remains a problematic issue in view of possible new elections. In addition, the CEO of ESM Klaus Regling expressed doubts about plans for direct aid payments for banks bailout fund can be met. Late on Friday, Chinese authorities announced new restrictions on the purchase of real estate, including higher down payment and interest rates on mortgages for second homes in the cities. Administration in Beijing imposes 20% tax on profit on sales of existing homes. The European indexes and oil also lost positions, as investors sought the protection of the USD and the gold. In an interview with Bloomberg economist Nouriel Roubini warns of risks of a deeper recession in the Eurozone and slowing growth in USA in the second half of the year as a result of fiscal consolidation in the country. The leading German Dax index lost 0.21 per cent amid uncertainty about the fiscal situation in the United States and the political situation in Italy. In London Fin.-Times fell 32.97 points to 6345.63 points, while the Zurich SMI lost 11.47 points to 7,590.52 points. In Paris the CAC 40 index, however, added 0.27 per cent in cautious trade before the conclusions of the Eurogroup and the monetary policy decisions of the few central banks in the coming weeks.

European stock markets started the week with declines

European stock exchangesThe first session of the week on the stock exchanges in Europe passed with predominantly pessimistic. Overall liquidity remained low in order to rest day in the United States and the absence of any major economic and corporate news. The regional Stoxx Europe 600 index fell 0.2 percent to 287 points. This indicator records the third consecutive session of decline.
“Today was a day with no major events without much activity”, says John Redwood of Evercore Pan-Asset. “We have some indications that Germany will probably avoid a recession, which could be considered good news. Strong Germany will help restore and other European countries”, he added. Tumbled nearly 6 percent today registered shares Brewing Company Carlsberg. The reason for this was a disappointing report for the last quarter.
The main index of the London Stock Exchange’s FTSE 100 slid 0.2 percent today to 6,318 points. Reliable indicator of the apostasy of the representatives of the mining sector, which is now under pressure. Anglo American shares lost 2.8 percent, while those of Antofagasta – 1,3 percent.

European indexes again returned to growth

European indexesThe stock markets in Europe, erasing losses from Monday’s session today. Analysts said market participants are already turning their attention to the upcoming weekend meeting of G-20, avoiding any large-scale operations. Today, regional Stoxx Europe 600 index rose 0.5 percent to 287.97 points. That was almost up for the loss of 0.6 per cent recorded on Monday.
“We do not see much action in view of the upcoming G-20. People do not want to take large positions before her and want to see what will be said about currency devaluations”, says John Redwood for the media of Evercore Pan-Asset. In recent months, market observers have focused on whether the currency war could scare the market. The reason for such a scenario can become extremely aggressive policy for impairment of certain currencies. At the corporate level today reported losses tire manufacturer Michelin (-4,3%), and the largest Italian company producing weapons and avionics Finmeccanica (-7,3%). In the opposite position was the British banking giant Barclays, after its shares rose 8.4 percent today. Reason was a plan to cut costs to save 1.7 billion GBP to the financial institution.

European investors remain wary

Investors Borse FrankfurtThe European indexes ended the session mixed Monday despite upbeat U.S. economic data and expectations of robust earnings of Chinese companies. The Stoxx Europe 600 lost 0.12 percent to 289 points after trading in today’s weak fluctuated between gains and losses. The markets are likely to remain in this range in the coming days as investors await catalysts that either make them take up new positions or leave the market, said John Ventry, Director of Multi-Manager and Chief Investment Officer of Skandia Investment Group.
Last year, markets were expecting a series of bad news, but in early January see correction to more normal levels. Many risks subside – some problems were solved in USA, while extreme “tail-risk” around Europe and China disappeared Ventry said. “From here on, there is no particular reason to have even steer setup. At the same time there is nothing that would make us sell. On the horizon is not particularly apparent risks in the short term”, he said.
Earlier today the indexes in China reported strong growth amid optimistic forecasts for earnings of Chinese companies in December and reported 17.3% growth in profit overall. News from USA also contributed to some optimism. Orders for durable goods in December increased by 4.6 percent – a result pleasantly surprised analysts who had expected twice as weak growth. Wall Street started the session of the green area.