Greece vows to rein in debt as markets buckle December 11, 2009
Posted by businessnewss in businessnewss.wordpress.com.Tags: Buckle, debt, Greece, markets, rein, vows
comments closed
European stock markets sagged Wednesday amid worries over the record high budget deficit in the Greek economy.
A trader works on the floor of the New York Stock Exchange, Tuesday, Sept. 22, 2009, in New York. (AP Photo/Henny Ray Abrams)(Henry Ray Abrams/Associated Press)
In Europe, the FTSE 100 index of leading British shares was down 13.89 points, or 0.3 per cent, at 5,209.24 while Germany’s DAX fell 21.88 points, or 0.4 per cent, at 5,666.70. The CAC-40 was 21.77 points, or 0.6 per cent, lower at 3,763.53.
Sentiment in the market has been knocked in the last couple of days by worries about a global debt crisis. Moody’s Investor Services warned the United States and Britain to get a grip on their public finances to avoid threats to their top triple-A credit ratings. Meanwhile, rival Fitch downgraded its rating on Greece to BBB plus with a negative outlook.
“Greece’s debt downgrade will still be adding to worries about the exposure of European banks,” said Arifa Sheikh-Usmani, equity trader at Spreadex.
Greece’s new socialist government promised Wednesday to step up efforts to reduce the growing deficit.
“We are doing and will do everything necessary to control the giant deficit,” Prime Minister George Papandreou said at a cabinet meeting, broadcast on state television.
“That is the only way Greece will not be in danger of losing sovereign rights.”
Elected Oct. 4, Papandreou blames the previous conservative government for the country’s fiscal problems. Cost-cutting measures include a 10 per cent reduction in operating costs for the public sector next year and a hiring freeze for government jobs, along with planned staff reduction through limited hiring in 2011.
Greek banks owe the European Central Bank in excess of $70 billion and the country’s budget deficit is forecast to hit 12 per cent of GDP in 2010. Under European Union rules, member countries are forbidden to have deficits in excess of three per cent of GDP.
The Greek stock market has sold off all this week, and is down six per cent on Wednesday.
Asian exchanges lower
Earlier, investors in Asia were rattled after government figures showed that Japan grew far less than originally expected in the third quarter, at an annualized rate of 1.3 per cent instead of 4.8 per cent, as cautious companies slashed spending.
Japan’s Nikkei 225 stock average fell 135.75 points, or 1.3 per cent, to 10,004.72, while Hong Kong’s key index shed 318.76, or 1.4 per cent, to 21,741.76, and Shanghai’s benchmark was off 1.7 per cent at 3,239.57.
Australia’s market lost 0.7 per cent and Singapore’s market was off 0.3 per cent.
The South Korean market bucked the trend and advanced 0.4 per cent to 1,634.17 after the International Monetary Fund raised the country’s economic growth forecast for 2010. Taiwan’s market also rose 0.4 per cent.
With files from the Associated Press The Canadian Press, 2009
Stock markets reverse recent slide November 3, 2009
Posted by businessnewss in businessnewss.wordpress.com.Tags: markets, Recent, Reverse, slide, Stock
comments closed
The Toronto stock market closed above 11,000 on Thursday as investor relief over U.S. economic growth helped claw back losses racked up during a four-day tumble.
After four days of declines, the Toronto Stock Exchange was sharply higher on Thursday.(CBC)
The S&P/TSX composite index surged 269.9 points to 11,075.2 after the U.S. Commerce Department reported that the country’s gross domestic product rose at a 3.5 per cent annualized pace during the July to September period, slightly better than the 3.3 per cent growth that economists had expected.
It was the first time the U.S. economy has grown since early 2008 and a sign the recession there has ended.
“I don’t know that it was convincing enough to make everyone feel good again,” said Ted Whitehead, vice-president and senior portfolio manager at MFC Global Investment Management, an asset-management firm with offices in Canada and the United States.
“We can’t keep stimulating the economy [and] with the consumer still strapped, people are kind of questioning what’s next.”
The Toronto market lost 248 points Wednesday, adding to a 728-point loss over four straight sessions after a disappointing report on sales of new U.S. homes helped ignite worries about the pace of a recovery.
The Canadian dollar closed up 1.00 cents to 93.72 cents US.
The December crude contract on the New York Mercantile Exchange rose $2.41 to finish trading at $79.87 US a barrel. On Tuesday, a report in the Financial Times newspaper suggested Saudi Arabia is moving to abandon the West Texas Intermediate oil contract as the benchmark for pricing its oil.
New York indexes also charged ahead, with the Dow Jones industrial average up 199.89 points to 9962.58.
The Nasdaq composite index climbed 37.94 points to 2097.55, while the S&P 500 index was up 23.48 points to 1066.11.
With files from The Canadian Press (more…)
Recovery fears drag markets lower October 2, 2009
Posted by businessnewss in businessnewss.wordpress.com.Tags: drag, fears, lower, markets, recovery
comments closed
The Toronto Stock Exchange main index lost more than 300 points Thursday as North American financial markets lost ground on concerns about the strength of the economic recovery in the United States.
U.S. stocks ? which have been on a rally for seven months ? fell the most in a month as jobless claims rose and manufacturing slipped. Citigroup Inc. was more than six per cent lower and CIT Group was off more than 12 per cent in New York. The Dow Jones Industrial Average closed down 203 points to 9,509.3.
In Canada, stocks fell for a second day on concerns that exports to the United States ? Canada’s biggest trading partner ? might be affected by a slowing of the American recovery. Bombardier was down 2.1 per cent and Suncor fell by four per cent.
The Standard and Poor’s/TSX composite index fell 323.2 points on the day, or roughly three per cent, to 11,071.8. The benchmark had added 9.8 per cent in the quarter that ended Wednesday, gaining 19 per cent over the previous three months.
Natural gas prices tumbled after statistics from the U.S. government showed there is more gas in storage than at any time on record. The records go back to 1975. The November contract finished at $4.47, down 37 cents on the New York Mercantile Exchange. Oil rose 21 cents to $70.82 US a barrel.
The dollar fell 1.19 cents to 92.21 cents US after soaring 1.28 cents on Wednesday.
Markets move up sharply July 24, 2009
Posted by businessnewss in businessnewss.wordpress.com.Tags: markets, move, Sharply
comments closed
The TSX composite over a month
North American markets gained more than two per cent Thursday on a variety of bullish indicators.
In Toronto, it was a report from the Bank of Canada saying that economic growth in the current quarter indicated the recession was over.
In the United States, a bigger-than-expected increase in sales of existing houses suggested that the real estate market was recovering.
The S&P/TSX composite index jumped 2.3 per cent or 243.33 points to 10,675.68.
The index rose from the opening, then held fairly steady around 10,650 before moving up toward the end of the session to close at the day’s high.
The TSX mining, energy and financial sub-index led the climb.
The future price of a barrel of oil rose $1.76 to $67.16 US in New York Mercantile Exchange trading.
The Canadian dollar was also strong, moving up 1.01 cents to 92.04 cents US.
The Dow Jones industrial average rose 2.1 per cent or 188.03 points to 9,069.29. It’s the first close over 9,000 since Jan. 6.
The Nasdaq index was up 2.45 per cent or 47.22 points to 1,973.60.
Markets surge on bullish U.S. statistic June 24, 2009
Posted by businessnewss in businessnewss.wordpress.com.Tags: bullish, markets, statistic, surge
comments closed
The TSX over the past month
North American markets roared ahead Wednesday morning after the U.S. government reported that orders for durable goods were much stronger in May than expected.
The statistic is a key indicator of business investment and a bullish signal.
Toronto received an extra boost as shares in Addax Petroleum surged on news that a Chinese company was buying Addax for $8.27 billion.
The S&P/TSX composite index was up 223 points at 10,121 in noon trading.
All the TSX sub-indexes were up, with energy and diversified metals posting the biggest percentage gains.
In New York, the Dow Jones industrial index was up 71 points to 8,394, and the Nasdaq index had gained 38 points to 1,803.
The U.S. Commerce Department said Wednesday that demand for durable goods rose 1.8 per cent last month, far better than the 0.6 per cent decline that economists expected. It also matched the rise in April, with both months posting the best performance since December 2007, when the recession began.
The stock market’s gains Wednesday reclaimed some of the ground lost Monday, when Toronto fell 453 points, dragged down by falling commodity prices and a World Bank report warning that the international economy will shrink further this year than the bank forecast in March.
“Look, there are no fundamentals to this market — it’s all trading on sentiment,” said John Stephenson, portfolio manager at First Asset Funds Inc.
With files from The Canadian Press
Asian markets fall as investors leery of recovery prospects May 24, 2009
Posted by businessnewss in businessnewss.wordpress.com.Tags: Asian, Fall, Investors, leery, markets, Prospects, recovery
comments closed
Asian stocks wilted Friday as the possibility of credit rating downgrades for major economies and bleak unemployment figures in the U.S. added to fears the recent massive rally was built on shifting sands.
After piling into battered markets over the past two months, running up gains of 30 per cent or more from Asia to the U.S., investors are increasingly hard pressed to justify hopes that a global economic recovery is around the corner.
In the U.S. and Europe overnight, markets were unnerved by a credit agency’s warning about the British government’s debt ratings. The threat of a downgrade could signal similar problems for the United States and other big economies staggering under a growing mountain of debt as they try to spend their way out of recession.
An employment report from the world’s biggest economy was equally dispiriting. Though the number of newly laid-off workers seeking unemployment benefits in the U.S. fell 12,000 to 631,000 last week, continuing claims rose to 6.7 million — hitting a new record for the 16th consecutive week in data going back to 1967.
‘No consensus’
The unrelenting bad news and recent losses on Wall Street were leading many investors to reassess their expectations about the economy and the recent rally, analysts said.
“It seems the markets are at a crossroads. What were seeing today is a lot of confusion,” said Kirby Daley, senior strategist at Newedge Group in Hong Kong. “The markets here are trying to digest what is truly happening in the U.S. and trying to balance that with Asia.”
“There is no consensus view right now, and that’s leaving investors confused,” he said.
In Tokyo, Japan’s Nikkei 225 stock average gave up early gains to drop 38.84 points, or 0.4 per cent, to 9,225.81, while Hong Kong’s Hang Seng index was off 241.83, or 1.4 per cent, at 16,957.74. Elsewhere, South Korea’s Kospi slipped 1.3 per cent and Australia’s benchmark was down 1.4 per cent.
Among the few gainers, Taiwan rose 0.3 per cent and Malaysia’s index rose 0.5 per cent.
Stocks in Tokyo were also pressured by a strong yen, which hurts profits of the country’s brand name exporters.
Toyota Motor Corp., the world’s No. 1 automaker, dropped 2.2 per cent, Sony Corp. shed 2.0 per cent and Japan’s top chipmaker Toshiba Corp. fell 1.2 per cent.
British rating cut?
The far-reaching consequences of the global recession were underlined Thursday by Standard & Poor’s warning that Britain’s credit rating may be cut because of rising debt. That would raise the cost of borrowing for the British government, which is taking a big role in bailing out that country’s stricken banks, and could mean similar warnings for other debt-laden governments.
Analysts said the S&P warning shows there are limits to how much debt governments can take on even when it’s part of efforts to revive staggering economies. And even after governments pumping hundreds of billions of dollars into economies around the world there are still questions about how soon a rebound might take hold.
Those fears and weak data reined in Wall Street on Thursday.
The Dow fell 129.91, or 1.5 per cent, to 8,292.13, after earlier falling as much as 201 points. The Standard & Poor’s 500 index fell 15.14, or 1.7 per cent, to 888.33, and the Nasdaq composite index fell 32.59, or 1.9 per cent, to 1,695.25.
Stock futures pointed to modest gains Friday in the U.S. Dow futures rose 20, or 0.2 per cent, to 8,315 and S&P futures were steady at 888.70.
In oil, crude stayed above $61 US a barrel in Asia. Benchmark crude for July delivery was up 48 cents to $61.53 a barrel midday in Singapore in electronic trading on the New York Mercantile Exchange.
North American markets stumble on Inauguration Day January 22, 2009
Posted by businessnewss in Uncategorized.Tags: American, Inauguration, markets, North, stumble
comments closed
The inauguration of the new U.S. president may have lifted the spirits of recession-weary consumers, but it did little for the North American markets.
The stock exchanges were in a “No, We Can’t” mood as financial stocks sold off on the banking sector’s latest woes while the Toronto market was also hit by sharp slides in energy stocks amid lower oil prices.
Toronto’s S&P/TSX composite index was off 336.5 points to close down at 8504.93.
New York’s Dow Jones industrial average fell 332.13 points to 7949.09 and the NASDAQ also dropped by 88.47 points to 1440.86.
The Canadian dollar lost 0.81 cent to 78.89 cents US.
Analysts blamed the aftershocks of yesterday’s announcement from the Royal Bank of Scotland that it will likely post a $41.3-billion US loss for 2008.
The loss didn’t do the British pound any good. It slumped to a seven and a half year low against the U.S. dollar Tuesday amid fears that Britain’s credit rating could be downgraded if the government has to take over the banks.
It’s presently trading at $1.3904 U.S.
The Bank of Canada also said it expects the economy will continue to shrink until mid-year and cut its key interest rate by another half a point to one per cent ? the lowest ever ? to provide stimulus.
Toronto, Calgary office markets to sag in ‘09: Colliers December 27, 2008
Posted by businessnewss in Uncategorized.Tags: Calgary, Colliers, markets, Office, Toronto
comments closed
Office vacancy rates in Toronto and Calgary will jump in 2009 as new buildings open during an economic downturn, according to a study released by Colliers International on Tuesday.
The commercial real estate service company said that while many of Canada’s business rental markets should fare well, property owners in the country’s biggest city and its economic juggernaut both will face financial woes in the coming months.
“Calgary and Toronto will feel the fallout of the global economic slowdown as these two markets share the same short-term oversupply issues, with several million square feet of new office space completed in 2009 and 2010,” Colliers said in its most recent study of the rental markets in six major Canadian cities.
In these two urban areas, new office towers built when economic conditions were buoyant and business vacancy rates were falling are set to open just as these two crucial factors are forecast to change direction.
Tough times in T.O.
Colliers said Toronto’s vacancy rate is expected to drop in the final three months of this year, to 4.5 per cent compared with 5.6 per cent in the same quarter of 2007. In an earlier report, however, Colliers predicted that Toronto’s five per cent vacancy rate would rise to seven per cent in 2009.
“Softening demand due to weak economic conditions and the expected supply of several million square feet of new office space will pose challenges for some of the prestigious towers in Toronto’s financial district during 2009 and 2010,” the company noted.
At that level, however, Toronto’s vacancy rate still favours landlords, since Colliers set an office vacancy rate of eight to 10 per cent as the point where the market is balanced between renters and owners.
U.S. vacancy ratesCityLatest report (%)Manhattan8.7Detroit17.3Baltimore17.4Silicon Valley20.0Source: Colliers International, various reports
Colliers noted that Vancouver, with a vacancy rate of four per cent, should benefit in the run-up to the 2010 Olympic Games.
As well, Edmonton and Ottawa probably will avoid large amounts of empty space because of continued government demand. And Montreal, which currently has a six per cent vacancy rate, does not have any new office complexes set to open in 2009, Colliers said.
Colliers did not produce a long-term forecast for Calgary, but indicated that falling oil prices, now about $40 US a barrel compared to a peak of $147 in the summer, will keep demand for new office space in the Alberta city flat at best.
Still, Calgary had a vacancy rate of 3.5 per cent in the July-to-September period, well below the rate in Toronto and a number of key U.S. cities.
Property owners in many American urban areas face far higher vacancy rates than those in Calgary or Toronto. Only Charlotte, N.C., at two per cent, has a rental market as robust as Calgary’s.
Dumping inventory
Colliers noted that many business markets in Canada and the United States will also be hurt as companies stockpiled office space in good times only to give up or sublet the space as the economy turns sour.
“While the economy flourished, tenants tended to snap up additional space that became available in their buildings to accommodate future growth,” said Ian MacCulloch, vice-president, research with Colliers International in Canada.
“However, as the economic conditions continue to deteriorate, companies will look for ways to adjust operating expenses, releasing this underutilized office space back to the market in the form of sublets.”
Markets jump after Fed cuts interest rate to lowest level ever December 18, 2008
Posted by businessnewss in Uncategorized.Tags: after, Cuts, ever, interest, Jump, level, lowest, markets, Rate
comments closed
The U.S. Federal Reserve has cut the country’s federal funds interest rate by three-quarters of a percentage point to a target range of zero to 0.25 per cent.
That is the lowest level on record in the United States for the rate, which is the price that banks charge each other for loans. U.S. commercial banks are now expected to lower the prime rate, the key rate for many loans to consumers. It’s currently four per cent.
The cut sparked jumps in stock markets and a drop in the U.S. dollar against other currencies.
In announcing the cut Tuesday, the Fed said U.S. labour and market conditions, consumer spending, business investment and industrial production are all falling.
“Financial markets remain quite strained and credit conditions tight. Overall, the outlook for economic activity has weakened further.”
The economy is so bad that the rock-bottom rate is likely to continue for some time, the central bank said.
It also promised to use “all available tools” to get the U.S. economy moving. As it said previously, it will buy large quantities of debt and mortgage-backed securities to support to the mortgage and housing markets.
It’s also considering buying longer-term bonds to push down long-term interest rates.
Stock markets make move
The Fed move prompted a surge in stock markets. In New York, the Dow Jones industrial average surged 4.2 per cent, gaining 359.61 points to 8,924.14. It had been up less than 100 points before the announcement.
The S&P/TSX composite index rose 3.1 per cent, adding 262.28 points to 8,724.11.
The U.S. dollar fell against other currencies, including the loonie, which closed up 2.02 cents at 83.21 cents US.
While the Fed was worried about inflation earlier this year, those concerns have eased with falling commodity prices and the economy’s weaker prospects.
The U.S. Labour Department reported that inflation in November fell a record 1.7 per cent, the biggest drop since seasonally adjusted statistics were introduced in 1947. The drop in oil prices drove the decline.
Some economists believe the Fed’s cut was affected by the inflation figure, because the prospect of deflation poses a profound threat to the economy.
The Fed cut was announced by its monetary policy committee after a two-day meeting to consider its response to what some are calling the worst U.S. economic conditions since the 1930s.
Many economists believed the Fed would cut interest rates in half on Tuesday to 0.5 per cent to spur the economy, but some wanted a more aggressive 0.75 percentage point cut.
Last week, the Bank of Canada cut its overnight rate by three-quarters of a percentage point, bringing it down to 1.5 per cent, a 50-year low.
Markets surge in late trading on report of new U.S. treasury secretary November 22, 2008
Posted by businessnewss in Uncategorized.Tags: Late, markets, Report, Secretary, surge, Trading, Treasury
comments closed
The S&P/TSX composite index in the past month.
North American markets jumped late in the session Friday after NBC News reported that U.S. president-elect Barack Obama would nominate New York Federal Reserve Bank president Tim Geithner as treasury secretary.
The Dow Jones industrial index, S&P 500, Nasdaq and S&P/TSX composite index all broke out around 3 p.m. ET and climbed steadily until the close.
The indexes gained from five per cent to 6.5 per cent, after swinging above and below Thursday’s close in early trading.
Toronto’s S&P/TSX index was up 430.6 points, or 5.6 per cent, to 8,155.39. The Dow Jones index was up 494.1 points, or 6.5 per cent, to 8,046.42. The S&P 500 rose 6.3 per cent and the Nasdaq was up 5.2 per cent.
The benchmark TSX index had been far up and slightly down earlier in the session.
Toronto-Dominion Bank shares fell $2.27 to $41.30 after a $6.36 drop Thursday, prompted by the announcement of charges it will take related to the global credit crunch.
On the TSX, the gold sub-index was up more nearly 24 per cent as the gold price added more than $43 US an ounce to $791.70.
