The Asian stock indexes ended the month with moderate optimism, but generally do not think was particularly beneficial for market participants. Monthly regional index MSCI Asia Pacific reported a loss of nearly 10 per cent, which is the poor performance of October 2008 onwards. Following the retreat, which recall the presentation of the index during the period after the bankruptcy of investment bank Lehman Brothers, the average price / earnings of the companies in the index fell to 14.4. This is well below the level of 23 recorded in early 2010. Today, the index decreased by 0.1 per cent minimum to 113.33 points. The exchange in Tokyo the Nikkei 225 added 0.1 percent to 9 768.70 points, but this does not help for the removal of even part of the accumulated loss for May. In the month indicator erase some 12 percent of its value. China does Shanghai Composite slumped by 9.7 per cent for the month, continuing retreat of 7.7 per cent recorded in April. Just today, the index fell 2.4 percent to 2 592.15 points. During today’s trading session progressed Taiex in Taiwan with 1.08 per cent to 7 373.98 points. With so increase the index and the leading exchange in South Korea – KRX 100, which ended three months at 445.68 points.
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The leaders of the U.S. Federal Reserve Ben Bernanke and European Central Bank (ECB) Jean-Claude Trichet stressed in separate statements that developing economies are a key factor for global financial stability. According to Bernanke the global economy increasingly dependent on emerging markets to maintain strong domestic demand and economic and financial stability. The improvement of policies and regulatory frameworks in emerging markets has an effect beyond those economies themselves, he said. In a separate statement prepared for a press conference during a meeting of finance ministers and heads of central banks of the G-20 in South Korea at the end of this week, Trichet stated that developing economies have been a source of strength in the world financial crisis. Characteristic aspect of this crisis was that going from industrialized economies. Developing countries were also severely affected, but as a group remained the lifeblood of the global economy, Trichet said in a pre-prepared statement for the press conference. Speaking of Bernanke is also pre-recorded for the event. Bernanke gives an example South Korea, saying the government and the central bank of the country, launched after the Asian financial crisis of the late 90’s of last century, helped South Korea to resist the current crisis.
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The British economists have suggested the Greek government to rescue its economy abandon the euro and declared bankruptcy on its debt of 300 billion euros, says the Times. London-based Centre for Economics and Business Research (CEBR) warned the Greek ministers that will be able to escape the debt trap of the country, unless it devalued its currency to encourage exports. The only way this can happen is to return to Greece its own currency – the coin. Greek politicians rejected the idea of leaving the euro area would lead to disintegration of the single currency. “Leaving the euro would mean that the new currency will be cheaper at least by 15% and as the national debt is measured in euros, it would automatically increase the level of debt of 120% of GDP to 140% of GDP,” said Doug Makuilyams, executive director of the CEBR, during talks in Athens yesterday. “So part of the idea of leaving the euro is Greece unilaterally convert debt into the new local currency. Separation of Greece to the euro would be a disaster for Germany and French banks, which Greece owes billions of euros. However Makuilyams sets this development as “practically inevitable” and added that other eurozone countries could follow suit in Greece.
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New recession in the euro area is unlikely, a depreciation of the euro will help reduce the negative effects that have measures to reduce the debt on economic growth, says Pier Carlo Padoan, chief economist of the Organization for Economic Cooperation and Development (OECD) said from CNBC. Governments need to pursue fiscal consolidation and reforms in the pension insurance system and labor market to promote economic growth, said Padoan. To convince skeptical financial markets in the effectiveness of its strategy, governments should also show that the coordinated work, he added. Even measures to reduce the debt limit growth in the eurozone, it will be partly offset by increased demand for European goods from Asian and other markets due to their better competitiveness resulting from weaker euro, he said. According to data from the European Central Bank the value of the euro against the U.S. dollar declined by 14% this year, while trade-weighted value of the euro has decreased by more than 10%. “Will there be a” W-shaped “recession in Europe? I do not think, “said Padoan, emphasizing that the massive debt following the global recession in 2007 – 2009,” is not just European history “and that Europe will deal with this problem faster than others.
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Today’s session began on Wall Street with strong increases in the indexes in line with the positive wave that swept and securities markets in Asia and Europe. Investors welcomed the better than expected sales figures for new homes and orders for production of durable goods in the U.S., which showed the economy recover. Before the start of stock trading today showed that new orders for the production of durable goods in the U.S. jumped 2.9 percent on a monthly basis in April, which was twice as high as expected. The reported growth also is fourth in the last five months, which predicts greater activity in the manufacturing sector of the country. Even more encouraging were the data on sales of new U.S. homes last month, which increased to 504 thousand housing units annually. This is 15% above the March level and their highest value in the past two years. Sales of new homes are leading indicator for the state of the economy and consumer attitudes. The index of the 30 largest U.S. stock market liquidity and Dow Jones IA companies increased by 1.3% to 10 170.87 points and a half hours after the start of the session. The broader S & P 500 advanced at the same time with 1.2% to 1 086.73 points and Nasdaq Exchange main index Nasdaq Composite rose by 1.6% to 2 246.96 points.
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Germany is considering to extend the ban on uncovered short sales of shares of ten banks in the country, so that it applies to all listed shares in Germany, Air Force forward. During the last week, Germany surprised its European partners, such as bans unilaterally uncovered short sales of shares of the ten leading banks in the country, government bonds and swaps related to the protection of non-performing debt for the period ending March 31, 2011. The current proposal from the Treasury is the prohibition to apply for shares and derivatives of all companies. The proposal is likely to be discussed by the country’s Cabinet next week, includes the creation of new “system transparency” for short sales, which include control over some of the financial regulator BaFin. Germany is making high reductions of costs and needs to reduce expenses in case to prevent the strong European economy from the financial and debt crisis. Germany approved high support for Greece last days, which will be returned from the European banks during next years.
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The crude oil price continues to fall, but still stood near the level of 70 dollars per barrel. This is happening against a background of very sharp movements in the 3-4% upward and downward direction. During the exchange session in New York yesterday, the price of black gold fell 2.1 percent to 68.75 dollars, while during the session to losing more than 4 percent of its value. This morning, however, quotations with advancing 0.64 percent to 69.39 dollar after early night again were over the threshold of $ 70 a barrel. The main reason for the sharp drop in the price of black gold during yesterday’s trading session was a sharp setback for the euro against the dollar. This limited interest in investing in raw materials and pushed down their prices. The reason for the deletion of the losses in oil prices gave the report of the American Petroleum Institute gasoline stocks, which last week rose unexpectedly to 3.19 million bbl. This gave the effect of speculation that demand for fuel is increasing, supporting quotations.
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70% of companies with revenue of $ 1 billion or more plan to increase spending on initiatives related to climate change in the next two years, according to global study commissioned by Ernst & Young and said. Nearly half of 300 directors of companies surveyed said that their investments related to climate change will vary from 0.5% to over 5% of their revenues by 2012. 82% of respondents indicated that they plan to invest in energy efficiency over the next 12 months, while 92 percent believe that energy costs will be an important factor during this period. The heads of companies commit to taking action, although said that complying with different regulations in different countries will be a challenge. The fact that 70% of company bosses are planning to spend more for programs related to climate change is “one of the amazing discoveries, the study indicates Melanie Steiner of Ernst & Young. Despite regulatory uncertainty on climate change “companies really take action because they see that this is a business issue and opportunity to generate new revenue,” said Steiner. While action to tackle the consequences of climate change in the past been a question in the field of public relations today are able to make money through new services and products, savings through better efficiency and reducing the risk, she adds.
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The crude oil price is back below $ 70 a barrel last night, blotting out its minimum height of yesterday’s trading session in New York. The decrease is mainly due to renewed subsidence of the euro, which in turn is under pressure because of problems in the banking sector in Spain. At the time the single currency is moving to a serious decline 1,2280 EUR / USD, which is a retreat from more than 100 pips for the night. This is due to fears that Spain is facing a banking crisis, since Saturday the country was nationalized Savings Bank CajaSur. Exchange in New York yesterday, the price of U.S. light crude rose 0.2 percent to 70.21 dollars a barrel. At night, however, quotes about lost 1.5 per cent this morning raw material traded on 69.13 dollars a barrel. Yesterday in London Brent with delivery in July fell 51 cents to 71.17 dollars per barrel, but this morning the price of raw materials fell by more dollars to 70.17 dollars a barrel. The price of crude oil supported the strong US Dollar and in end of Asian markets session, the USD reached new high levels.
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The crude Oil prices rose today in Asian electronic trading, after rising on the stock exchanges in Asia. The U.S. light crude for delivery in June increased its value by 69 cents to 70.73 dollars a barrel. Trading of raw material, however, moved uncertain, the price is low or below $ 70 because of ongoing concerns about the ability of governments worldwide to pay its obligations, as well as uncertainty about future monetary policy of China. London’s Brent North Sea add 31 cents to 71.99 dollars a barrel. Asian stock markets for the new week started hesitantly, but then the major indexes began to show a profit. Growth stood at the head of the shares of Chinese construction companies due to rising hopes that Beijing may slow the tightening of measures to curb booming realty sector. Shanghai Composite added over 3% of its value, while Hang Seng Index rose 0.6 percent. In India, the Sensex has advanced by 1.2 per cent in Korea is up to 0.4%. Exception to the general picture made Japanese Nikkei 225. Light finish trade fell by 0.27 per cent. Dark mood in Japan was driven by concerns about possible “contamination” disease “debt crisis”, vihreshta on the Old Continent.
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