Tuesday 28th July 2015
NEWS TICKER, Tuesday July 28th: The Spanish Mercado Alternativo Bursátil (MAB) has admitted INCLAM to list on the market’s growth company segment. The company will trade from July 29th this year. Its trading code will be INC and trading will be through a price setting mechanism which will match buy and sell orders by means of two daily auction periods or “fixings”, at 12 hrs and at 16 hrs. Stratelis Advisors is acting as registered adviser and MG Valores SV as liquidity provider. - Moody's: Al Khalij Commercial Bank (al khaliji) Q.S.C.'s asset quality and capital strengths moderated by high reliance on market funding. Al Khalij Commercial Bank (al khaliji) Q.S.C. (AKB) benefits from a solid overall financial profile which is moderated by high reliance on market funding and concentration risks, says Moody's Investors Service in the report "Al Khalij Commercial Bank (al khaliji) Q.S.C: asset quality and capital strengths are moderated by high reliance on market funding" - While German SME’s continue to be plagued by recruiting problems, according to a new KfW survey fewer are bothered about filling employment vacancies than they were back in 2010. More women and older people in the working population, increasing labour mobility and the rise in skilled labour from other EU countries is helping filling the employment gap. Even so, the survey suggests that over the longer term, skilled labour shortages could be the order of the day – In a filing with the Luxembourg Stock Exchange Bank Nederlandse Gemeenten has given notice of amended final terms to the holders of TRY77.5m notes at 10.01% due June 17th 2025 (ISIN Code: XS1247665836 and Series no. 1214) issued under the bank’s €80bn debt issuance programme. The amendment includes provision that the issuer may settlement any payment due in respect of the notes in a currency other than that specified on the due date subject to pre-agreed conditions. Deutsche Bank London is the issuing and paying agent, while Deutsche Bank Luxembourg is listing agent, paying agent and transfer agent. The Shanghai Composite Index ended down 8.5% at 3725.56, its second-straight day of losses and worst daily percentage fall since February 27th, 2007. China's main index is up 6% from its recent low on July 8, but still off 28% from its high in June. The smaller Shenzhen Composite fell 7% to 2160.09 and the small-cap ChiNext Closed 7.4%. Lower at 2683.45. The drop comes as investors wonder how long the government’s buying of blue chip stocks can last. Clearly, the government can’t be seen to be pouring good money after bad to prop up what looks to be a failed strategy of propping up the market. Disappointing corporate earnings data across the globe has affected Asia’s main indices in today’s trading. The Hang Seng Index fell 2.7%. Australia's S&PASX 200 was down 0.2%, the Nikkei Stock Average fell 1% and South Korea's Kospi was off 0.4%. Turnover also remains depressed on Chinese exchanges, with around RMB1.2trn the average volume traded, compared to more than RMB2trn before this current downturn – In other news from the Asia Pacific, New Zealand’s Financial Markets Authority (FMA) has issued a Stop Order against Green Gardens Finance Trust Limited (GGFT) and warns the public to be wary of doing business or depositing money with this company. The Stop Order prohibits GGFT from offering, issuing, accepting applications for or advertising debt securities and/or accepting further contributions, investments or deposits for debt securities – Meantime, in Australia, the Federal Court has found that Astra Resources PLC (Astra Resources) and its subsidiary, Astra Consolidated Nominees Pty Ltd (Astra Nominees), breached the fundraising provisions of the Corporations Act, as part of civil proceedings brought by ASIC. In his judgment, Justice White upheld ASIC's claims that Astra Resources and Astra Nominees breached the Corporations Act by raising funds from investors without a prospectus or similar disclosure document, as required under the law.

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The European Review

By Patrick Artus, chief economist at Natixis

US reindustrialisation poses challenge for eurozone

Tuesday, 22 May 2012 Written by 
US reindustrialisation poses challenge for eurozone A reindustrialisation process has been underway in the U.S. since 2009, linked to the trend in the profitability of industrial companies, wage costs and energy prices. It has already enabled the U.S. to regain market share in global trade, creating an additional problem for the euro zone given it is already faces market share losses to emerging countries and weak domestic demand. The euro-zone economy is therefore likely to be further weakened if it loses more export trade to the U.S. http://www.ftseglobalmarkets.com/

A reindustrialisation process has been underway in the U.S. since 2009, linked to the trend in the profitability of industrial companies, wage costs and energy prices. It has already enabled the U.S. to regain market share in global trade, creating an additional problem for the euro zone given it is already faces market share losses to emerging countries and weak domestic demand. The euro-zone economy is therefore likely to be further weakened if it loses more export trade to the U.S.

Reindustrialisation process under way in the U.S.

The reindustrialisation of the U.S. is evident from the upswing in productive investment and manufacturing employment as well as from the upturn in manufacturing output, which has outpaced the euro zone since the crisis. Yet – for the time being – U.S. reindustrialisation has mainly affected the automotive and capital goods sectors.



Growth of U.S. industry can be ascribed to three factors:

-       rapidly increasing profitability of industrial companies in the U.S.;

-       labour costs in industry, which are lower in the U.S. than in Germany or France;

-       and the low cost of energy thanks to the fall in the price of natural gas, due to shale gas production.

The United States is regaining export market share

The U.S. situation in terms of export market share has been improving since the end of 2008. It appears that the U.S. has increased its market share in global exports largely at the expense of the euro zone and Central European countries (CEEC). Since end-2008, the U.S. trade deficit with the euro zone, Asian emerging countries excluding China, other American countries and Japan has been shrinking, though its trade deficit with China has stopped deteriorating. But in terms of export market share, U.S. improvement seems to match the deterioration in Europe.

An additional problem for the euro zone

The euro zone is already faced with a decline in domestic demand as a result of the restrictive fiscal policies, a decline in real wages due to the rise in unemployment and a loss in market share to emerging countries.

So – any further losses in export market share to the U.S. will therefore come on top of these problems. A depreciation of the euro could obviously correct the euro zone’s loss of competitiveness (in terms of wages and the price of energy). However, even during periods when the euro-zone crisis is acute, the euro still remains overvalued against the dollar

Patrick Artus

A graduate of Ecole Polytechnique, of Ecole Nationale de la Statistique et de l'Adminstration Economique and of Institut d'Etudes Politiques de Paris, Patrick Artus is today the Chief Economist at Natixis. He began his career in 1975 where his work included economic forecasting and modelisation. He then worked at the Economics Department of the OECD (1980), before becoming Head of Research at the ENSAE. Thereafter, Patrick taught seminars on research at Paris Dauphine (1982) and was Professor at a number of Universities (including Dauphine, ENSAE, Centre des Hautes Etudes de l'Armement, Ecole Nationale des Ponts et Chaussées and HEC Lausanne).

Patrick is now Professor of Economics at University Paris I Panthéon-Sorbonne. He combines these responsibilities with his research work at Natixis. Patrick was awarded "Best Economist of the year 1996" by the "Nouvel Economiste", and today is a member of the council of economic advisors to the French Prime Minister. He is also a board member at Total and Ipsos.

Website: cib.natixis.com/research/economic.aspx

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