Sunday 21st December 2014
NEWS TICKER: FRIDAY DECEMBER 19TH 2014: Scotiabank’s Commodity Price Index dropped -4.8% m/m in November (-6.1% yr/yr) and will end 2014 in a ‘deflationary’ mode, says economist Patricia Mohr. "Significant capacity expansion and the defence of market share by major oil and iron ore producers— against a backdrop of lacklustre world economic growth — account for the softness at the end of the year," she says. Mohr adds that the decision by Saudi Arabia not to reduce output to shore up international oil prices, but instead to allow prices to drop to levels curbing US shale development appears to be having a negative impact on confidence in a wide variety of other commodity as well as equity markets. She predicts prices will fall further this month, but will start to rebound in mid 201 - Jonathan Hill, the EU's financial-services commissioner, says he plans to pursue rules that separate a bank's proprietary trading from retail operations. "The sensible thing to do is to seek to make progress quickly" on the issue, Hill said. "There are still areas of risk in some of the biggest and most complicated banks,” reports Bloomberg- CME Group, said yesterday that it will change daily price limits in its CME Feeder Cattle futures effective today, pursuant to its emergency action authority. The current daily price limit for CME Feeder Cattle futures is $3.00 per hundredweight and will change to $4.50 per hundredweight effective on trade date December 18th Additionally, effective December 19th (tomorrow) these limits will have the ability to expand by 150% to $6.75 per hundredweight on any business day in the event that one of the first two contract months settles at limit on the previous trading day. CME Feeder Cattle futures have been locked limit for five consecutive days as a result of various factors. The change to daily price limits is necessary to ensure continued price discovery and risk transfer, says the CME. Daily price limits for CME Live Cattle futures will remain unchanged at $3.00 per hundredweight. Effective Friday, December 19th, these limits will have the ability to expand by 150 percent to $4.50 per hundredweight in the event that one of the first two contract months settles at limit on the previous trading day - The Straits Times Index (STI) ended +16.42 points higher or +0.51% to 3243.65, taking the year-to-date performance to +2.49%. The FTSE ST Mid Cap Index gained +0.29% while the FTSE ST Small Cap Index gained +0.71%. The top active stocks were Keppel Corp (+2.68%), SingTel (-1.02%), DBS (+2.36%), Global Logistic (-3.21%) and UOB (+0.30%). The outperforming sectors today were represented by the FTSE ST Basic Materials Index (+3.13%). The two biggest stocks of the FTSE ST Basic Materials Index are Midas Holdings (+6.38%) and Geo Energy Resources (unchanged). The underperforming sector was the FTSE ST Telecommunications Index, which declined -0.98% with SingTel’s share price declining -1.02% and StarHub’s share price declining-0.73%. The three most active Exchange Traded Funds (ETFs) by value today were the IS MSCI India (+2.56%), DBXT CSI300 ETF (+0.42%), STI ETF (+0.61%). The three most active Real Estate Investment Trusts (REITs) by value were Ascendas REIT (-0.42%), Keppel DC REIT (unchanged), Suntec REIT (+0.26%). The most active index warrants by value today were HSI23400MBeCW150129 (+7.32%), HSI22600MBePW150129 (unchanged), HSI24000MBeCW150129 (+12.50%). The most active stock warrants by value today were KepCorp MBeCW150602 (+21.95%), DBS MB eCW150420 (+29.29%), DBS MB ePW150402 (-18.03%) - Spain’s Director of Public Prosecutions, Eduardo Torres Dulce, has resigned from the post for “personal reasons”, Spanish daily El Mundo reported this morning. A spokesman for the Public Prosecutor’s office confirmed the news by telephone to The Spain Report, saying that Mr. Torres Dulce had informed Justice Minister Rafael Catalá of his decision: “but that it perhaps would not come into effect until they find a replacement”. That decision is taken at cabinet level. The next cabinet meeting for Rajoy’s government is tomorrow morning - Hedge funds including Marshall Wace, Odey Asset Management and Lansdowne Partners are shorting OTP Bank Plc, a Hungarian lender with a Russian subsidiary whose shares have fallen almost 6% this month reports Albourne Village. All three London-based funds took or increased their position this month in OTP, Hungary’s largest lender, according to data compiled by Bloomberg. The ruble rose today in Moscow after plunging as much as 19%against the dollar yesterday, when Russia’s central bank increased interest rates to 17% percent from 10.5 percent in an attempt to stem the decline. The ruble is down 52% this year and has taken a disproportionate beating in the wake of sanctions and falling oil prices. The country still has the third largest currency reserves in the world and so is unlikely to default. According to Eric Chaney, Manolis Davradakis and Greg Venizelos from AXA IM’s Research and Investment Strategy team Russia will likely resort to fiscal stimulus to contain the risk of social and political unrest. Capital controls, political unrest and even default on private hard currency debts are possible outcomes they say. They credit default swaps market is pricing a one-third probability of sovereign default within five years - Indonesia is ramping up financing for its $439bn development program, planning an almost fivefold increase in sales of project sukuk. The government is seeking to raise IDR7.14trn rupiah (around $568m) from notes that will fund particular construction ventures next year, compared with IDR1.5trn this year, which say local press reports, will help finance its estimated spending of about IDR5,519trn from 2015 to 2019 to build roads, railways and power plants.

US and Europe facing separate growth tracks, says OECD

Thursday, 29 March 2012
US and Europe facing separate growth tracks, says OECD Economic growth in the G7 countries is expected to be firmer through the first half of 2012, but the recovery remains fragile and will likely proceed at different speeds in North America and Europe, the OECD said in its latest interim economic assessment. The assessment, presented in Paris by OECD chief economist Pier Carlo Padoan, says the G7 economies are projected to grow by 1.9%  in both the first and second quarters of 2012, although a strong variance in outcomes is expected across this group of countries. http://www.ftseglobalmarkets.com/

Economic growth in the G7 countries is expected to be firmer through the first half of 2012, but the recovery remains fragile and will likely proceed at different speeds in North America and Europe, the OECD said in its latest interim economic assessment. The assessment, presented in Paris by OECD chief economist Pier Carlo Padoan, says the G7 economies are projected to grow by 1.9%  in both the first and second quarters of 2012, although a strong variance in outcomes is expected across this group of countries.

“Our forecast for the first half of 2012 points to robust growth in the United States and Canada, but much weaker activity in Europe, where the outlook remains fragile,” says Padoan. “We may have stepped back from the edge of the cliff, but there’s still no room for complacency,” he adds.



 

In the United States, the ongoing rebound in employment, stronger consumer confidence, higher equity prices and credit growth are underpinning the recovery, with growth projected at 2.9%  in the first quarter and 2.8% in the second. Canada is projected to grow by 2.5% during each of the first two quarters

 

The optimistic view on North America contrasts with the much more fragile outlook in Europe, where weak consumer confidence, climbing unemployment and tight credit all point to further  falls in activity.

 

The OECD projects that the euro area’s three largest economies—Germany, France and Italy—will shrink by 0.4% on average during the first quarter, before a moderate 0.9% growth recovery in the second quarter.

 

Seen individually, the German economy is expected to accelerate through the first half of the year, with growth of 0.1% in the first quarter and 1.5% in the second. The French outlook is more muted, with a -0.2 percent reduction in the first quarter followed by 0.9%  growth in the second. In Italy, weak industrial production and household sentiment suggest recession for the first two quarters of the year, but the most recent indicators have been more positive, resulting in slightly better projected growth for the second quarter, the OECD says.

 

In the United Kingdom, the economy is expected to contract by 0.4% and grow by 0.5% in the second quarter.

 

Growth in Japan is projected to rebound strongly in the first quarter to 3.4%, before easing to 1.4%  in the second quarter. A number of factors threaten the recovery, including rising oil prices, weakening activity in emerging market economies, notably China, and a slowdown in world trade growth that reflects weakening global demand. “Government action will continue to be critical, particularly in the euro area, where unfinished policy business on fiscal frameworks, financial firewalls and fundamental structural reforms must move ahead,” Padoan adds.

 

Economic growth in the G7 countries is expected to be firmer through the first half of 2012, but the recovery remains fragile and will likely proceed at different speeds in North America and Europe, the OECD said in its latest Interim Economic Assessment.

The Assessment, presented in Paris by Chief Economist Pier Carlo Padoan, says the G7 economies are projected to grow by 1.9 percent in both the first and second quarters of 2012, although a strong variance in outcomes is expected across this group of countries. (
See the Chief Economist’s presentation)

“Our forecast for the first half of 2012 points to robust growth in the United States and Canada, but much weaker activity in Europe, where the outlook remains fragile,” Mr Padoan said. “We may have stepped back from the edge of the cliff, but there’s still no room for complacency.”
In the United States, the ongoing rebound in employment, stronger consumer confidence, higher equity prices and credit growth are underpinning the recovery, with growth projected at 2.9 percent in the first quarter and 2.8 percent in the second. Canada is projected to grow by 2.5 percent during each of the first two quarters
http://mcmbo1.oecd.org/vgn/images/portal/cit_731/13/63/50008626unemployment.PNG
 
The optimistic view on North America contrasts with the much more fragile outlook in Europe, where weak consumer confidence, climbing unemployment and tight credit all point to further     falls in activity. The OECD projects that the euro area’s three largest economies -  Germany, France and Italy - will shrink by 0.4 percent on average during the first quarter, before a moderate 0.9 percent growth recovery in the second quarter.

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