A.B. | ShareCast | 21 Jan, 2013 12:05 - Updated: 21:48 | | |
- Eurogroup to discuss bank liquidity injections
- Bundesbank does not expect weakness to last long
- Merkels CDU loses elections in Lower Saxony
- Juncker sees no decision tonight on Cyprus
- Richemont down on weakness in Asia Pacific
FTSE-Mibtel 30: 0.06%
Ibex 35: 0.23%
Stoxx 600: 0.16%
The major European equity benchmarks were trading near unchanged by the midday point of the session. That despite the unexpected election defeat of German Chancellor Angela Merkels CDU in the state of Lower Saxony and ahead of this evenings meeting of Eurogroup finance ministers.
The SPD/Greens won another state from Merkel's CDU/CSU/FDP coalition, even if only by one seat. Nevertheless, Barclays Research did not see the results as affecting policy-making at the federal level. Also to be taken into account, Merkel and her allies in the FDP continue to lead very comfortably in national polls (at 47% versus the SPD/Greens at 38%). Even so, the national elections could still become a tighter race than the latest polls suggest, those economists indicated.
Of interest, some reports indicated that Germanys Economics minister Rosler- had offered to tender his resignation following the defeat.
Discussions at Monday evenings Eurogroup meeting were expected to include the option of direct bank recapitalization by the European Stability Mechanism (ESM), the aid program for the Spanish banking sector, according to analysts, and the naming of the groupings new President. No decision was expected on Cyprus.
Acting as a backdrop, US markets were to remain closed in observance of the Martin Luther King Holiday. No less relevant was the start of the Bank of Japans two day policy meeting, after which it might unveil aggressive new policy measures at least on the monetary policy side.
Richemont weighs on the Stoxx
Luxury goods maker Richemont announced that sales in the last quarter of 2012 were flat in the Asia Pacific region, even if that follows on several years of exceptional growth in that area of the world, especially in China. To be had in account are the demanding comparative figures for the same quarter last year. As well, wholesale sales growth was lower than in the first six months and in the comparative period due to the cautious approach taken by the Groups retail partners in Hong Kong and mainland China.
Over the weekend German power producer E.On asked unions to return to talks.
In the latest edition of Der Spiegel EADS Chief Executive Tom Enders told the German government that it would not accept interference in the companys decisions on when and where to develop aircraft in the future.
Nokia might be looking to sell £625m in debt to benefit from the recent fall in market rates, according to a source cited by Bloomberg.
From a sector stand-point the worst performers were Personal and household goods (-0.75%), Media (-0.71%) and Real Estate (-0.19%).
Better than expected economic data
The Dutch consumer confidence index for the month of January improved to -36
points from -39 in the month before (Consensus: -39).
Spains trade deficit narrowed to 29.5bn euros in the 11 month until the end of November, but exports declined by 6% versus a year ago.
German producer prices fell by 0.3% month-on-month in December (Consensus: 0.0%).
In its monthly report for January the Bundesbank said that the weak business cycle should not last long.
Euro steady despite election results
The euro/dollar was standing 0.02% lower at 1.3318.
Front month Brent crude futures were down by 0.206 at $111.67.
Ford Motor Co said on Tuesday it is poised to drop the Pimco Total Return Fund from its 401k plan, citing the sudden departure of Bill Gross as the reason behind its decision.
On Tuesday, Yahoo reported sales that topped estimates, as chief executive (CEO) Marissa Mayer’s turnaround efforts began to pay off.
Cloudbuy gave an update about its “peak performance” tour in the Middle East and Asia Pacific regions, saying the trip put the company in a position to become “a major player” in the emerging markets.
Glaxosmithklline will be among the most high-profile companies to release results on Wendesday as the pharmaceutical giant reports its third-quarter figures.
US office supply chain Staples is investigating possible payment card data theft, according to reports.
On Tuesday, Apple said it was aware of 'intermittent organised network attacks' on users attempting to sign-in on iClould.com.
Janus Capital, Bill Gross’s new fund, will place an increased focus on liquidity and positive absolute return.
Irish technology company Afilias has expressed its intention to float on the AIM market, as it expects to raise approximately €78m after issuing new shares.