LONDON (SHARECAST) - -Crude moves higher on Mid-East tensions
-IMF cuts global growth forecasts
-Portugal receives one year extension on adjustments
-Germany and France pushing for financial transactions tax
-Spanish 10 year benchmark bond up 11bp to 5.82%
-Italian 10 year bond yields up 3bp at 5.11%
-China CB injects 42.2bn dollars in reverse repos
FTSE-100: -0.54%
Dax-30: -0.78%
Cac-40: -0.70%
FTSE-Mibtel 30: -0.37%
Ibex 35: -1.85%
Stoxx 600: -0.45%
European equity markets were finally unable to close in the blue. That despite reports that the International Monetary Fund (IMF) is studying several potential avenues by which to support European nations seeking aid, including new loans from the global lender, a top IMF official said Tuesday.
Also weighing on equities, yesterday´s meeting of Eurozone finance ministers saw them grant Portugal an extra year to carry out its adjustment -a positive. However, economic authorities –Greece´s lenders- are being described as still at loggerheads over how to tackle the country´s crisis.
As if to underline the risks which the world economy is currently facing, the International Monetary Fund (IMF) yesterday forecast that global growth will only rise by 3.3% this year and 3.6% next year. The Washington based lender´s 2012 forecast is the lowest since 2009. Furthermore, the IMF is now said to see “alarmingly high risks” of a steeper slowdown, with a one-in-six chance of the rate of expansion dropping south of 2% (commonly accepted to be the threshhold for recessions at the global level).
Particularly worth highlighting, at first glance, are the Fund´s new estimates of the peak levels which Greece and Spain´s public debt piles are now expected to hit. Many observers see them as proof that excessive austerity may backfire.
Acting as a backdrop, China´s central bank last night injected $42.2bn into the country´s money markets via so-called reverse repos, in what some consider a bid to stimulate growth.
Fiat to cut outlook for European car marketPeugeot´s Chief Executive has rebuffed French industry minister Arnaud Montebourg´s remarks to the effect that he will wring concessions from the carmaker in talks on its restructuring - Peugeot plans to cut 8,000 jobs and close an assembly plant, Reuters reports.
Luxury goods company Hermes's Chief Executive, Patrick Thomas, told the Wall Street Journal (WSJ) that it remains optimistic about the Chinese market.
Fiat will cut its outlook for the European auto market when the company updates its five-year plan that runs through 2014, Chief Executive Officer Sergio Marchionne told Bloomberg.
From a sector stand-point the worst performance was seen in the following sectors: Personal goods resources (-1.15%), Telecommunications (-0.99%) and Banks (-0.90%).
French trade deficit narrows
The French trade deficit improved to €5.3bn in August, after -€4.2bn in the month before (Consensus: -€5bn).
Dutch industrial production fell by 0.1% month-on-month in August.
Crude rises, even as the euro drops, on Mid-East tensions
The euro/dollar fell by 0.78% to the 1.2870 dollar mark on haven flows towards “dollar zone” assets, after Turkey sent more weapons to the Syrian border.
Front month Brent crude futures rose by 2.45 dollars to the 114.65 dollar mark on the ICE.
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