International Business News

European shares ended Friday declined, while Wall Street turned down, in a context that is marked by fears about the crisis in the eurozone.

In Paris the CAC 40 finished down 0.13% (3.99 points) to 3,008.00 points. The Paris index lost 3.89% on the week and 4.8% since the beginning of the year.

The UK FTSE dropped 1.33% and 0.60% the German Dax, while the pan-European FTSEurofirst 300 index ended down by 1.18% to 969.81 points, at lowest since December.

Going against the trend, some banks have rebounded, including Santander (2.97%) and BNP Paribas (2.94%), supported by the rumor of a reintroduction of the ban on sales to die covered on banking stocks.

Fitch downgraded the ratings on Thursday night in Greece, citing the growing risk of leaving the country monetary union, while Moody's has downgraded 16 Spanish banks, citing the ability reduced by the Spanish state to help them. 

On Wall Street, the entrance of Facebook on the Nasdaq has temporarily obscured the uncertainties created by the political situation in Greece. But the market turned downward, and the action of the first global social network, which debuted at 42.05 dollars, quickly erased its gains to return around its IPO price of $ 38.

Financing costs to be borne by Spain grew strongly at an auction took place Thursday, a day also marked by the confirmation that the country fell into recession and an article by press reports of massive withdrawals of deposits from the fourth Spanish bank.

The Spanish Treasury had to agree to pay a return of around 5% and invest in bonds and three to four years, including an average yield of 5.106% for a security maturing in April 2016 against 3.374% in the last similar operation in March.

"This unfavorable trend seems well established. Ultimately, this increase in performance may lead to a form of intervention outside, "said Richard McGuire, an analyst at Rabobank rate

. Wednesday

, Spanish Prime Minister Mariano Rajoy said that the government may soon find it difficult to fund at acceptable levels …… On

… the secondary market, the yield on ten-year Spanish bonds is around 6.3%, far off the level of 7% who die gered the aid given to Greece, Ireland and Portugal. 

Madrid, however, can take advantage of a rare good news reached the end of the day: the agreement reached with Catalonia, a region that weighs up to 20% of gross domestic product ( GDP) Spanish, a reduction in public spending.

In addition to the current difficulties of the banks, debt regions is considered another major risk factor for Spain, some already see as the next victims of the crisis debt in the euro area.

Last week, the European Commission considered that this debt would be one of the regions of the reasons that would prevent Spain to meet its budget deficit target set for 2012, which is 5.3% of GDP. 

FALLING ACTION Bankia

Earlier in the day, the Spanish government had to disprove the existence of a movement of panic withdrawals from money deposited in the bank in difficulty Bankia, nationalized the week last, the title lost up to 30% following information along these lines.

"It is not true that there is now an exit monitoring Bankia chests," said Fernando Jimenez Latorre, Secretary of Economy, during a press conference. 

For its part, in a notice sent to the Spanish stock exchange authorities, Bankia emphasizes that movements of deposits recorded during the first half of May were seasonal, adding no substantial change in the balance of deposits was not expected in the coming days.

The title Bankia finally ended down 14.08% to 1.422 euro after falling to 1.171 euro in session. The index grouping the European banking stocks yielded 2.36% on its side.

Last week, Spain took control of Bankia, the fourth largest bank, hoping to reassure the markets and stabilize a weak financial sector made by the housing crisis.

In the wake of the nationalization, Madrid has imposed on its banks to increase their reserves to protect themselves from mounting losses on their toxic loans in real estate, while pledging to make a limited assistance to troubled institutions through loans at high rates. 

These measures, however, did not help to dispel investors' doubts about the ability of the Spanish government finally repair the financial system of the country, questions that have aggravated the back of concerns about ; the debt crisis of the euro area, heightened by the political stalemate in Greece.

According to El Mundo, Bankia clients withdrew a few days over one billion euros from their accounts. José Ignacio Goirigolzarri informed the Board of Directors met on Wednesday the funds are withdrawn, the newspaper said.

RECESSION THAT WILL EXTEND

The first quarter of 2012 resulted in a further economic contraction of 0.3%, which, after a decline of similar magnitude to the previous quarter, is officially back in Spain recession, which is technically defined as two consecutive quarters of falling GDP.

"The recession is advancing at a gradual pace, but if we take into account the latest surveys on activity, it seems that the economic contraction will continue into quarters come, "said Tullia Bucco, an economist at UniCredit. 

The Spanish manufacturing sector contracted at its fastest pace in almost three years in April, while the service industry fell for the tenth month of row, according to the purchasing managers' index.

The export sector, the only one that has progressed over the last two quarters, slowed from January to March, the main economic partners of Spain is also experiencing the recession or slowdown.

Although Spain was able to master its accounts, the country is at the forefront if ever Greece, currently in a political impasse, should leave the euro. 

"It's not totally Greece leaving the euro, which is the main issue is the domino effect," said John Bearman, Investment Officer at Thomas Miller Investment.

CNP Assurances announced Friday that the market decline of savings in Europe had continued to weigh on its sales in the first quarter and said the change of government in France maintained the uncertainty the life insurance industry.

The turnover of the insurer fell 12.9% during the first three months of the year, to 7.028 billion euros.

The action CNP Assurances signed Friday in early trading shrinkage greater than that of the sector to 9:50, the title lost 2.27% to 9.7330 euros, while the European index limited its losses to 1.35%.

"There is a wait due to the structure of taxation and savings in general," he said during a conference call the Director Financial Group, Antoine Lissowski. 

He explained that it was difficult to assess the impact that doubling the ceiling of the Livret planned by President-elect Francois Hollande on appetite of French for life insurance.

It is currently suffering from competition from banks, seeking to attract customers and their deposits with savings accounts attractive.

The persistence of low interest rates also makes traditional life insurance products unattractive in terms of yield.

Despite a set back, CNP Assurances has managed to generate a first quarter net profit up 1.8% to 275 million euros through improved financial markets. 

The group took advantage of the upturn to continue its program of disposals of risky assets, particularly in Italy and Spain.

"The improved market conditions in the first quarter allowed us to record an increase in our earnings while actively pursuing our strategy of selling risky assets," said the director gen ; eral, Gilles Benoist, in a statement.

Antoine Lissowski said his group no longer had to date of Greek sovereign debt and had reduced its exposure to equity markets.

The CFO did not want to comment on the planned replacement of Gilles Benoist.

NOC has postponed its annual meeting from 7 to 29 June, after the parliamentary elections. 

At that time a new boss of the Caisse des Depots (CDC), the majority shareholder of NOC, should have been appointed.

Director General of the CDC until early March, Augustin de Romanet applied for membership to the estate of Gilles Benoist as Director General of NPC.

The British telecoms operator BT said on Thursday a 12% increase in its annual dividend, its cost savings and solid demand in broadband that led to its beneficial ; fice and its cash flow despite an overall decline in sales.

BT, which has relied in recent years of spending cuts and efficiencies to power its cash, has also pledged that his dividend increased by 10 to 15% per year over the next three years.

"In what remains a difficult environment, we recorded another year of earnings growth and free cash flow," said CEO Ian Livingston. 

BT, which competes with Virgin Media and TalkTalk, shows a steady improvement in its performance since the profit warnings issued in 2008 and 2009, and because of the strict control its costs.

The full year, earnings from main businesses grew 3% to 6.1 billion pounds despite a 4% drop in sales , to 19 billion pounds (23.65 billion euros).

The cash flow appears considerably higher than projected at 2.5 billion pounds.

BT results were supported by an agreement in March to fill the deficit of 4.1 billion pounds pension fund's staff decided more quickly than before. The announcement was relieved investors by opening the door to a potential increase in dividends.

"It is not possible to renegotiate the pact budget", said on Monday a spokesman for German Chancellor. This ensures that Francois Hollande will be welcomed "with open arms." German Chancellor Angela Merkel (the Bundestag by December 2, 2011).

Germany has raised its conditions Monday to President-elect Francois Hollande, ruling out any renegotiation of the European fiscal pact and all initiatives "growth deficit".

"It is not possible to renegotiate the fiscal pact", which has already been "signed by 25 of the 27 member states of the European Union", which aims to strengthen discipline in public finance management, said the spokesman of Chancellor Angela Merkel, Steffen Seibert, during a press conference.

He was asked about the willingness of Mr. Holland to add a component to the pact on growth. In this regard, Mr. Seibert also reiterated the conditions of Berlin: Germany does not want "a growth deficit, but growth through structural reforms."

Clearly, there is no question for the Merkel government in Europe to promote recovery policies, but to promote the path chosen by Germany and the labor market reforms implemented by former Chancellor Gerhard Schröder .

French President elect had scored on his victory speech by his willingness to "give to the European dimension of growth, employment, prosperity, the future" and explain in Berlin and other partners that "the austerity could no longer be inevitable. "

A little later, Angela Merkel said that Francois Hollande is welcomed "with open arms" during his first visit to Germany, taking place after the handover. "We work well together and intensively," said Merkel at a news conference in Berlin, stressing that "the Franco-German cooperation is essential for Europe and we all want Europe to succeed" .

Pierre Mariani, the Group CEO, denied Wednesday it had set conditions for his eventual departure of the head of the Franco-Belgian bank being de mantling, ensuring that no decision had been taken on his replacement.

Several Belgian newspapers reported that the Belgian government would like to replace Pierre Mariani by Karel De Boeck, former CEO of Fortis.

According to these newspapers, the current Group CEO would be willing to leave his position as number two in the bank if they receive a severance package of 1.2 million euros stipulated in its contract. 

"The Group CEO has made no request to the Belgian and French about the conditions of his eventual departure contrary to news reports published so far," re ; Pierre Mariani is in an email to Reuters.

"No decision on the replacement of the CEO and President (Jean-Luc Dehaene, Ed) Board has been taken to date" he continues.

Dexia Bank, already saved from bankruptcy in 2008 by Belgium, France and Luxembourg, was forced into last fall due to the dismantling of sovereign debt crisis. 

Luc Coene, the Governor of the Central Bank of Belgium (NBB) said Monday that the bank, which enjoys state guarantees for its refinancing needs, would probably need to be recapitalized again e.

The group has since seen its market capitalization crisis collapse. Currently, the bank is valued at about 350 million euros on the stock market with a share price at only 0.18 euros.

"CONFIDENCE TO PETER MARIANI"

Asked by Reuters, Michel Bouvard, president of the supervisory board of the Caisse des Depots (CDC), Dexia's largest shareholder with 17.7% stake, has in turn brought ; support for Pierre Mariani.

"Personally, I have every confidence in Pierre Mariani," said Michel Bouvard. "When you are in managing a complex issue, which is the case, it is better that he who began managing the file management ends until one goes to the next step. "

"I did not speak on matters of internal governance of Dexia," he nevertheless wished to emphasize.

Since the decision late last year to dismantle Dexia, the Belgian authorities have carried out the nationalization of retail banking activities in Belgium while the France has decided to return via the CDC and the Postal Bank, the activities of local government financing.

The European Commission must still approve the plan and set the price that Dexia will have to pay in exchange for 90 billion euros of state guarantees provided. 

Dexia posted a net loss of 11.6 billion euros in 2011 and some analysts said the bank could continue to generate losses in the coming years.

Although in sharp decline, the size of the stock of Dexia is considered by some analysts as a systemic failure to pay the bank would have incalculable consequences for the entire system European banking.

Small and medium businesses, entrepreneurs and self-family businesses, which account for most of the economic fabric of the country, paying a heavy price for the Greek crisis. The European Commission is trying to address the funding problems they suffer. In Greece, six out of ten SMEs have seen their incomes decline in 2011.

Up to a thousand individual companies will put the key under the door every week in Greece in the first half of 2012 due to the serious crisis that is sinking the country, said Friday the European Commission, which seeks to root the problem.  

"Greece is facing an economic crisis and social crisis which is reflected in the situation of small and medium enterprises: six out of ten companies have seen their incomes decline in 2011 and 150,000 jobs were lost," said the Commission in a press on the sidelines of the visit to Athens Friday the European Commissioner for Industry, Antonio Tajani. "It is estimated that during the first half of 2012, up to 1,000 small businesses have closed every week," said the statement, which does not provide estimates on the number of companies created in parallel.

The Commission therefore calls for increased aid to these companies, self-entrepreneurs and family businesses, which form the bulk of the Greek economic fabric. Since last September, the European Union through its Task Force for Greece including trying to find ways to overcome the credit crunch affecting SMEs, banks, deficit, cut off from markets and dependent on the ECB, having suspended loans. In March, a special guarantee fund, with 500 million euros, was created by the EU to promote through the European Investment Bank lending to SMEs up to a billion euros.

According to the Commission, in 2010, Greece had 742,600 very small businesses, employing a total of 2.512 million employees, over 85% of total employment in the country, a record level in the EU. These structures produce 35.3% of the value added of the country against 21.8% on average in the EU. With 14% of employees on average in Greece, against 33% in the rest of the EU, large companies they create 28% of the value added, highlighting the low productivity of small businesses in Greece, the Commission added.

The Tokyo Stock Exchange ended down 0.82% Thursday, erasing gains from yesterday in the wake of Wall Street, investors fearing the results of a major auction of Spanish debt provided in the Day.

The Nikkei lost 78.88 points to 9,588.38 points and the Topix broader, yielded 5.14 points (0.63%) to 814.13 points.

At the opening, investors reacted to the downturn on Wall Street by making clearances. But following the publication of figures in the trade balance of Japan, a weaker yen on the foreign exchange market helped limit losses.

The downturn in the Japanese currency has allowed exporters including Toyota and Nissan to earn 0.9% and 0.24%.

Japanese exports rose in March at an annual rate for the first time in six months, mainly due to inflows into the United States but the high price of its crude imports weighs on its trade balance, back into the red.

Activity in the services industry and the euro zone shrank in March for the second consecutive month, according to the PMI company Markit. A decline in private activity that reflects the current recession in Euroland. Headquarters of the European Central Bank (ECB) in Frankfurt.

The private activity has continued to contract in March in the euro area, reflecting a return to recession in the first quarter, according to a second estimate of Wednesday's PMI purchasing managers. The composite index, which summarizes the activity in the manufacturing and service sectors, rose to 49.1 points in March against 49.3 in February. This is the second consecutive month in which the activity is contracting. This figure is higher than the first estimate of the index (48.7). Above 50 points, the PMI indicates that the activity increased, while if it is below this threshold, it contracts.

"This monthly decline in activity means that the entire first quarter of 2012, economic activity declined result synonymous with a new technical recession in the euro area", said in a statement the company that publishes Markit the PMI. Apart from growth in January, the economic downturn has been ongoing since last September, continues Markit. However, large disparities remain national: Italy and Spain are firmly entrenched in a recession in March. In Germany, growth slows and displays its lowest level in three months and in France, business retreats for the first time in four months. Only Ireland is holding its own game (PMI at 52.4 points in March to a high of 11 months).  

The eurozone has taken a first step towards recession in late 2011, recording for the first time in over two years a decline in activity. It should logically register a further decline in its activity in the first quarter. The growth figures for this period will be published mid-May by the European office of statistics, Eurostat. A recession is technically two consecutive quarters of decline in activity.

The German Finance Minister Wolfgang Schäuble has admitted for the first time Monday that the initiative to introduce a tax on financial transactions in the euro area was bound to e failure.

"We simply can not do it, even in the euro area alone," said Schaeuble in Berlin, referring to the Franco-German initiative to bail out of public finances with by the financial crisis. "We will therefore try something else."

Britain and other European countries do not support this tax, commonly known as "Robin Hood Tax," he said Schäuble, adding that the establishment of such a tax n ' was conceivable that across the EU.

A working paper of the European Commission is the basis for thinking of this tax, which could raise up to 57 billion euros, mainly from London, the leading financial center of the EU.

France must introduce in the coming months its own tax, similar to stamp duty imposed on the London stock exchange transactions.