European stocks rose as Federal Reserve Chairman Ben S. Bernanke said he would not rule out further bond purchases to boost growth and reduce unemployment, which he called a “grave concern.”
Bernanke’s speech comes two weeks before he leads a meeting of the Federal Open Market Committee to decide whether an expansion of the Fed’s record stimulus is needed to spur growth. Two rounds of large-scale asset purchases totaling $2.3 trillion have so far failed to reduce the jobless rate below 8 percent more than three years into the recovery.
Euro-area unemployment reached the highest on record in July, the European Union’s statistics office in Luxembourg said today. The jobless rate in the economy of the 17 nations using the euro was 11.3 percent, the same as in June after that month’s figure was revised higher. That’s the highest since the data series started in 1995.
National benchmark indexes advanced in every western- European market today, except for the U.K. and Iceland. The U.K.’s FTSE 100 Index fell 0.1 percent, while France’s CAC 40 Index rose 1 percent. Germany’s DAX Index climbed 1.1 percent.
Hermes increased 2.3 percent to 228.95 euros as it said annual sales growth excluding currency shifts “could be around 12 percent.” The company last month said it targeted annual revenue growth of 10 percent.
A gauge of European lenders was the best performer of the 19 industry groups on the Stoxx 600, with Banca Monte dei Paschi dei Siena SpA surging 6.5 percent to 22.4 euro cents, and Banco Santander SA rising 6 percent to 5.67 euros. Credit Agricole SA increased 7.6 percent to 4.64 euros.
Neste Oil Oyj, Finland’s only oil refiner, rallied 3.9 percent to 9.16 euros after Goldman Sachs Group Inc. raised the stock to buy from sell.
Futures rose. The focus is on Bernanke's speech at 14:00 GMT.
The consensus seems to be that Bernanke will not announce another round of quantitative easing, at least based on surveys of economists. But action the past month suggests that the market has priced in at least some possibility of a direct announcement today.
Global Stocks:
Nikkei 8,839.91 -143.87 -1.60%
Hang Seng 19,482.57 -70.34 -0.36%
Shanghai Composite 2,047.52 -5.06 -0.25%
Topix 731.64 -12.15 -1.63%
FTSE 5,752.74 +33.29 +0.58%
CAC 3,422.95 +43.84 +1.30%
DAX 6,996.05 +100.56 +1.46%
Crude oil $95.78 +1,23%
Gold $1664.30 +0.43%
European stocks rose, and if this trend will continue until the close of the session Stoxx Europe 600 Index will record its third consecutive monthly rooted. Now the attention of market participants focused on the speech today by Federal Reserve Chairman Ben Bernanke. At the same time, Asian shares fell and U.S. index futures rose.
Shares of Hermes International SCA (RMS) increased by 1% after the maker of bags Birkin & Kelly raised the target for sales this year on the back of that profit in the first half of the year rose more than expected.
Bankia SA shares have risen by 2.2%, due to the fact that Spain said it was considering the recapitalization of the country's largest lender nationalized by their own means.
Stoxx 600 added 0.3 percent to 265.78 at 9:39 am in London.
European stocks continue to move to the 0.8% drop from the previous week amid signs that the global economic growth is slowing, and the Spanish region of Catalonia asked for funding from central government.
Index MSCI Asia Pacific (MXAP) fell 0.6%, while contracts for Standard & Poor500 index added 0.3% today.
To date:
FTSE 100 5,729.16 +9.71 +0.17%
CAC 40 3,399.79 +20.68 +0.61%
DAX 6,931.84 +36.35 +0.53%
Asian stocks fell, with the regional benchmark index heading for its first monthly decline since May, as investors await a speech by U.S. Federal Reserve Chairman Ben S. Bernanke and as reports showed lower industrial output in South Korea and Japan amid slowing economic growth.
Nikkei 225 8,839.91 -143.87 -1.60%
S&P/ASX 200 4,316.11 +0.44 +0.01%
Shanghai Composite 2,047.52 -5.06 -0.25%
Sharp Corp. sank 13 percent as Taiwan’s Foxconn Technology Group founder Terry Gou ended a visit to Japan without announcing the conclusion of a deal to invest in the Japanese electronics maker.
China Shipping Container Lines Co. slid 7 percent after brokerages including Jefferies Group Inc. downgraded ratings and price targets for the nation’s second- largest shipping company.
Samsung Electronics Co. climbed 1.5 percent, reversing losses, as a Tokyo court ruled the mobile- phone maker didn’t infringe Apple Inc.’s patents.
Asian stocks fell, with the regional benchmark index wiping out its gains for the month, as reports on Japanese retail sales and South Korean business confidence add to signs of an economic slowdown and investors doubt the Federal Reserve will announce further stimulus.
Nikkei 225 8,983.78 -86.03 -0.95%
S&P/ASX 200 4,315.7 -40.74 -0.94%
Shanghai Composite 2,050.31 -2.92 -0.14%
Samsung Electronics Co., the world’s biggest mobile-phone maker by sales, slipped 1.2 percent in Seoul.
Atlas Iron Ltd. sank 5.5 percent, leading Australian iron-ore producers lower after the metal’s price in China declined to the lowest level in almost three years.
China Cosco Holdings Co. slid 4.1 percent in Hong Kong after the nation’s largest listed shipping company posted a wider first-half loss.
European stocks fell for a third day as data from Japan to Germany added to evidence that global growth is slowing while speculation cooled that Federal Reserve Chairman Ben S. Bernanke will announce more stimulus.
Daimler AG (DAI) and Fiat SpA (F) led a selloff in carmakers as Morgan Stanley said earnings in Europe are at risk. WPP (WPP) Plc dropped 1.9 percent after the world’s largest advertising company cut its sales-growth forecast. Carrefour (CA) SA and Vivendi (VIV) SA climbed after earnings topped analyst estimates.
The benchmark Stoxx Europe 600 Index (SXXP) fell 0.7 percent to 265.28, extending this week’s decline to 1 percent.
Reports today showed retail sales in Japan fell 0.9 percent in July from a year earlier, more than economists forecast, while confidence among manufacturers in South Korea stayed near the lowest level since the global financial crisis. Data out of Australia showed home-building approvals tumbled by the most in almost a decade.
In Europe, German unemployment increased for a fifth straight month in August while economic confidence in the euro area fell more than economists forecast to a three-year low.
National benchmark indexes retreated in every western European market today, except Iceland.
FTSE 100 5,719.45 -24.08 -0.42% CAC 40 3,379.11 -34.78 -1.02% DAX 6,895.49 -115.08 -1.64%
Daimler led a gauge of carmakers down 4.4 percent for the biggest decline among 19 industry groups in the Stoxx 600. The German maker of luxury vehicles fell 5.7 percent to 39 euros, Italy’s Fiat dropped 2.5 percent to 4.32 euros and Renault SA (RNO) slid 4 percent to 36.56 euros in Paris trading.
WPP slid 1.9 percent to 815.5 pence after the advertising company reduced its full-year revenue-growth forecast as clients cut spending amid the European debt crisis. Sales excluding the impact of acquisitions and currency fluctuations will grow “close to 3.5 percent” this year versus an earlier forecast for 4 percent, the company said.
BHP Billiton Ltd. (BHP) and Rio Tinto Group fell 3.2 percent to 1,844 pence and 2.1 percent to 2,716 pence respectively as iron ore sank to the lowest in almost three years in China.
Xstrata Plc (XTA) slid 2.4 percent to 901.7 pence and Glencore International Plc (GLEN) dropped 3 percent to 357.50 pence as Qatar Holding LLC, which has a 12 percent stake in Xstrata, said it will not support a merger between the two companies.
Hays Plc (HAS) tumbled 9.7 percent to 69.25 pence after the recruiter reported a 7 percent decline in full-year net fees, or payments from clients less the payroll costs of workers, for the U.K. and Ireland.
Pernod-Ricard SA (RI) declined 2.1 percent to 85.98 euros after France’s largest distiller reported a 9 percent gain in so- called organic operating profit in the year to June 30, missing the median analyst estimate for a 9.6 percent increase.
Barclays Plc fell 1.7 percent to 183.2 pence after naming Antony Jenkins as its chief executive officer.
Carrefour rallied 7.7 percent to 16.96 euros after the world’s second-largest retailer reported first-half profit that beat analysts’ estimates. Recurring operating income declined to 769 million euros ($965 million) from 838 million euros.
Vivendi gained 3.2 percent to 15.60 euros after Europe’s biggest media and telecommunications company reported second- quarter net income, adjusted for one-time gains and costs, of 706 million euros. That also beat analyst estimates of 652 million-euros. The company also raised its full-year forecast for the Activision Blizzard Inc. video-game unit.
ING Groep NV (INGA) rallied 2.8 percent to 5.92 euros after Bank of Nova Scotia agreed to buy the Dutch company’s Canadian unit for C$3.13 billion ($3.16 billion). Canada’s third-largest lender will spend C$1.9 billion after deducting excess capital at ING Direct in the cash deal.
Eiffage SA (FGR) surged 7.4 percent to 24.43 euros after France’s third-largest builder reported an 11 percent gain in first half operating income to 499 million euros as profitability at its APRR toll-road operation climbed.
Gemalto NV (GTO) advanced 5.4 percent to 62.66 euros after the inventor of the smart chip used in bank and phone cards said it will reach its 2013 profit target a year early. Earnings from operations rose 56 percent to 115 million euros, beating the average analyst estimate of 101.3 million euros.
Major stock indexes retreated from session lows, but still closed out a significant reduction amid growing concerns about the deterioration of the economic situation in Europe and the U.S..
Today's data showed an increase in the number of unemployed in Germany at a faster rate than expected.
The data from the U.S. also did not meet expectations: worse than expected data released on personal income and applications for unemployment benefits.
The focus of market participants is an economic symposium in Jackson Hole, which begins today. Especially market participants expect the performances at this annual event, Ben Bernanke, the Fed chairman, he will deliver on Friday, August 31.
Participants' expectations of what the Fed says the head diverge. In the market there is no certainty that they will obtain new signals about dopmer stimulate the economy, in particular on QE3. Ahead of us are waiting for the U.S. presidential election, which is unlikely to be taken any further action by the Fed, especially QE.
In the composition of the index DOW all components other than shares Merck & Co. Inc. (MRK, +0,23%), trading in the red. More than others in the share price fell Caterpillar Inc. (CAT, -1,77%) and Intel Corporation (INTC, -1,50%).
Branches in the context of all major sectors of the index S & P traded in the red. More than the others fell technology sector (-1.1%) and basic materials sector (-1.1%).
At the close:
Dow 13,000.78 -106.70 -0.81%
Nasdaq 3,048.71 -32.48 -1.05%
S & P 500 1,399.52 -10.97 -0.78%
Change % Change Last
Nikkei 225 8,983.78 -86.03 -0.95%
S&P/ASX 200 4,315.7 -40.74 -0.94%
Shanghai Composite 2,050.31 -2.92 -0.14%
FTSE 100 5,719.45 -24.08 -0.42%CAC 40 3,379.11 -34.78 -1.02%
DAX 6,895.49 -115.08 -1.64%
Dow 13,000.78 -106.70 -0.81%
Nasdaq 3,048.71 -32.48 -1.05%
S&P 500 1,399.52 -10.97 -0.78%
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