International Business News

The U.S. stocks closed lower Tuesday, penalized by the publication of statistics of home resales already been added to fears surrounding the health of perennials the world's biggest economy.

The Dow Jones closed with a loss of 133.96 points, or 1.32%, to 10,040.45. The Standard & Poor's 500 broad, fell 15.49 points, or 1.45%, to 1051.87 while the Nasdaq Composite Index ended down 35.87 points (-1.66%) to 2123 76.All three indexes have ended at levels unprecedented in seven weeks.

Sales of existing homes in the United States in July suffered an unprecedented fall that brings them back to their lowest level in more than 15 years, a deteriorating just confirmed that the U.S. recovery loses much of its momentum.

Shortly before the publication of these statistics, Charles Evans, president of the Federal Reserve Bank of Chicago, said that the risk of a relapse into recession in the U.S. economy had increased in the last six months even if such an outcome is unlikely in his eyes, a recovery "modest" is being said.

Home resales fell 27.2% last month compared to June to 3.83 million units annualized, the lowest level since May 1995, announced the National Association of Realtors (NAR) The American Federation of Estate Agents. Economists polled by Reuters were expecting a much less pronounced decline from 12.0% to 4.7 million.

This statistic has led to a decline in property values.The PHLX Housing Index was down by 1.05%.

"The economic statistics of the day were added to a long list of evidence showing that there is a slowdown in the economy," said Michael Sheldon of RDM Financial.

"Investors were expecting a mediocre statistics, but today's figures have revealed the extent of the disaster."

These events have however not been taken on renewed vigor of the activity on the front of mergers and acquisitions.

Hewlett-Packard and Dell continued to struggle to capture the data storage specialist 3PAR.According to Bloomberg, Dell is preparing to improve its offer after Monday HP has $ 1.6 billion on the table.

3PAR has closed up 3.64% to 27.04 dollars while HP has lost 1.65% to 38.39 dollars and Dell fell 2.97% to 11.58 dollars.

The medical equipment maker Medtronic has also plunged 10.80% to 31.21 dollars after reporting a drop in sales and lowered its forecast.

The announcement weighed on the sector and the Health Sector Index S & P lost 2.03%.

The president and CEO of Hewlett-Packard Co., Mark Hurd resigned Friday after being accused of falsifying expense reports to conceal a "close personal relationship" with a woman working for a subcontractor.

The announcement was made during the dip the world's largest maker of personal computers by 10%, Mark Hurd is credited with having brought HP to the highest level in five years at the helm of the U.S. group.

Mark Hurd will be replaced by Chief Financial Officer Cathie Lesjak who is acting as interim executive director.A committee was responsible for appointing a new CEO.

A colleague outside the group, who had worked on the marketing of HP between late 2007 and fall 2009, contacted the Board in June and accused of sexual harassment Mark Hurd, the group said.

An investigation ensued and concluded that Hurd had not breached the code within the company for sexual harassment.

But the CEO of 53 years, married, kept "a close personal relationship" with the woman without the knowledge of the board of directors, said HP.

"The investigation board has concluded that Mark had demonstrated a profound lack of discernment that has seriously damaged his credibility and was highly prejudicial to his ability to lead HP, and Mark agreed," said Mike Holston, director of corporate legal department.

The departure of the CEO was unanimous, he added.

The group says Hurd submitted "number of expense reports inaccurate" to conceal the relationship with the offending subcontractor, which has itself received compensation and refunds without a legitimate reason.

The sum of her falsified expense would reach 20,000 dollars for travel, accommodation and meals shared with the woman according to a source close to the Hurd's statements on the case, who spoke of a "working relationship".

Another source with knowledge of the case made it clear that this woman was not a major subcontractor.

ANTICIPATED RESULTS

Mark Hurd, known for its rigor in cost reduction, said in a statement that the decision to resign was "painful".

"I realized that on some occasions I have not met the standards and principles of trust, respect and integrity that I adopted at HP," he said.

The shock is brutal for investors, who saw Mark Hurd as the chief of the success of the Informatics Group.Since his arrival at the helm of the group five years ago, the stock price has more than doubled.

"Mark Hurd has a large responsibility in the revival of the group," said analyst Jeffrey Fidacaro.

"His departure will leave a big void at the head of the group."

The now former CEO of HP scored his mark, combining the rigor of external growth strategy, which took shape with major acquisitions as the pioneer of the smartphone or Palm, in 2008, EDS Corp., a leading software houses U.S. 13.9 billion.

Analysts said the place of Mark Hurd will be coveted both externally as internally, where the manager's PC division Todd Bradley and chief strategy Shane Robinson figure are potential candidates.

Hurd's departure, they added, should not affect either the strategic direction of the company or its performance.

The announcement was however immediately reflected on the price of HP has lost up to 10% in after-hours transactions, dropping to 41.50 dollars after the meeting ended at 46.30 dollars.

To cushion the shock, the group decided to bring forward the publication of its quarterly results.

He announced on Friday earnings per share to $ 1.08 in non-GAAP standards for the third fiscal quarter offbeat performance slightly higher than that anticipated in the consensus among analysts polled by Thomson Reuters I / B / E / S consensus forecast of $ 1.07.

The company raised its earnings per share over the year to a range of 4.49 to 4.51 against $ 4.45 to 4.50 dollars previously. The consensus is at 4.49 dollars.

HP also said it expects an annual turnover of between 125.3 and 125.5 billion dollars, while analysts are predicting a figure lower than this range to 124.515 billion dollars.

The corporate failures have continued to decline in France in June to register down 7.9% on the entire second quarter compared to the same three months of 2009, according to data published on the news website score3.fr business.

The Observatory for the failures identified score3.fr 13,189 openings procedures from April to June against 14,326 a year earlier, a decrease of 7.9% followed a modest decline of 1.8% in first quarter .

On June alone, the failures are the number of 4677, a figure higher than in May (4310), but down 7.2% compared to 5039 cases in June 2009.

"The improvement is particularly noticeable in the areas most affected by the crisis, namely real estate (-30.4%), manufacturing (-21.2%) or construction (-10.9 %), "said Score3.fr, which belongs to the group of business services Pouey International.

Agriculture and fishing have also seen their bankruptcies decline sharply compared to June 2009 (-44%) but some areas remain, however, the sentence, like business services and administrative support (14.4% ), accommodation and food (+3.2%), or transport failures which rose 1.4% compared to June 2009.

After several positive months, financial and insurance for their part, experienced strong growth in their failures (6%) in June a year ago. Developments in this sector, however, positive throughout the quarter with an average decline of 3.2% of failures from April to June 2009.

The detailed figures are available on the website www.score3.fr.

Negotiations on the reform of financial supervision has failed Wednesday and European agreement on the text has been postponed until September, show several European sources.

"There will be no further talks before late August or early September and I think we can say that the talks failed," a parliamentary source said.

"The core issue is Article 6 which concerns the principle of direct supervision exercised at European level by the new supervisors," the source said adding that the objective was to find a consensus with the all states, including Great Britain.

A second source confirmed the report and discussions held that "one or two additional steps the council (of EU ministers) in the direction of the European Parliament would be required to obtain an agreement."

Agricultural Bank of China (AGBANK), China's third largest bank, has priced its initial public offering dual Hong Kong and Shanghai, which should enable it to raise more than $ 22 billion (17.5 billion euros ) hypothesized high, bigger bet on the market ever.

The first trading day will be held July 15 in Shanghai and Hong Kong the next day. The official announcement of the award is scheduled for Wednesday.

AGBANK, founded by Mao Zedong in 1951, operates a large network of branches in the Chinese countryside and in larger cities.

Three years ago, AGBANK was technically bankrupt.His recovery, after a rescue of 30 billion dollars, has been boosted by the strong growth experienced in the country and the state control over the banking sector.

In Hong Kong, AGBANK sold 25.4 billion shares, representing 8% of its enlarged capital, at a price of 3.20 Hong Kong dollars part, totaling 10.4 billion U.S. dollars, it was reported Tuesday source close to the matter.

The bank had tightened Monday its price range, between 3.18 and 3.38 dollars per share in Hong Kong, against an initial range of 2.88 to 3.48 dollars.

In Shanghai, the price was fixed at the top of its indicative range which started at 2.52 yuan.AGBANK will sell 22.24 billion of yuan-denominated A shares at a price of 2.68 yuan coin, or 59.6 billion yuan (8.8 billion dollars).

In total, AGBANK rise $ 19.3 billion through its dual listing and even 22.2 billion dollars if the over-allotment option is exercised, an event likely in view of the application.

Previously, the largest ever IPO was that of Industrial & Commercial Bank of China with 21.9 billion in 2006.

OFFER 20 times oversubscribed

China International Capital Corp (CICC), Deutsche Bank, Goldman Sachs, JPMorgan, Macquarie and Morgan Stanley are the banks organizing the operation in Hong Kong, with the brokerage firm of AGBANK.

For placing on the market in Shanghai, banks are CICC, CITIC Securities, Guotai Junan Securities and Galaxy.

AGBANK is quoting on the stock market to allow the government to achieve its objective, namely to have the four largest banks in the country publicly traded.

Having for many of them had periods of insolvency, it are now among the largest banks – and companies – in terms of market capitalization.

A source familiar with the matter, it indicates that the offer of AGBANK in Shanghai was 20 times oversubscribed by institutional investors.

In Hong Kong, the institutional demand came from Asia to 4%, 30% U.S. 25% Europe thee, according to sources involved.

Individuals have however shown little enthusiasm in Shanghai, like Hong Kong.

The IPO allotment option included, values AGBANK about 150 billion dollars (nearly 120 billion euros), making it the fourth largest bank in terms of global market capitalization behind ICBC, China Construction Bank and HSBC .

Chaired by Xiang Junbo, headline writer and war hero, AGBANK operates 24,000 branches, employs 441,000 people and boasts 320 million customers.

The price for AGBANK bodes well for the four Chinese banks wishing to raise capital as is the case for Bank of China and ICBC.

The Shanghai stock market has lost nearly 25% since mid-April and fell sharply last week, partly because investors sold shares to participate in the offer AGBANK.

Fauchon intends to accelerate its development in the Middle East and make tea and chocolate its two main export products, having weathered the crisis and be able to break even.

With a turnover growth of 10% during the 2009-2010 fiscal year ended March 31, to 145 million euros, the luxury grocery relatively well through the crisis thanks to its business functions – which account for 18% of sales and grew 30% over the year – and thanks to Internet sales and business gifts which jumped 40%.

"I think the luxury food took its dimension of sharing and fun available," said Isabelle Capron, CEO of the company, in an interview with Reuters.

In times of crisis, "it differs less the purchase of a flash than a Ferrari," she smiled.

For the current year which started badly with the fall in April air traffic caused by the eruption of a volcano in Iceland, Isabelle Capron said it expects growth of 8%.

In terms of results, the company has managed to balance operational in 2009-2010 and is an operating profit of approximately 5% of sales within three years.

After a slow decline, the famous luxury shopping has been saved from bankruptcy in 2004 by Michel Ducros, company president – son of Gilbert Ducros, founder of the spices of the same name – which has acquired 90% the balance being taken by the management of the company and some private investors.

RENOVATION

Fauchon, shops and aging product line, then made a major restructuring led by its new CEO, an expert on marketing and advertising in schools formed the American Colgate.

"We renovated sites, product lines, image, teams, information systems (…) Everything has been reworked," she said.

Convinced of the power of a brand embodying the 120 years of French luxury food, Isabelle Capron initially wanted to give a new Fauchon strong visual identity made in black, white and fuchsia, while keeping the logo the effects of mirror from the 1930s.

"It should be quite radical and very visible," she says.

The renovation of the store's historic Place de la Madeleine in Paris, this revival has embodied the style codes closer to the fashion of the store.

Black lacquer, pink mirrors and tinted windows, the two shops of the place have also seen their product lines fresh completely redesigned.

To facilitate the transition in its stores, Fauchon opened a bakery and a bar area with caviar, pastries modernized with "collections" of flashes and bright colors for buttons or winks at the news (home sold lightning rainbow on the day of the "gay pride").The catering products are being reviewed while offering self-service will open in September.

If the activity is divided equally between the fresh produce and groceries, the latter, which requires less manpower, offers higher margins and can easily be exported.

TEA AND CHOCOLATE IN FIRST LINE

In the grocery store, what are tea and chocolate (which each accounted for 18% of group sales) that are the subject of attention and should be the engine of international growth.

"We invest in tea and chocolate, our two major providers of business growth and profitable recurring," said Isabelle Capron, inaugurated Monday a new line of chocolates numbered dubbed "Shock Made in F" produced in collaboration with chocolate Pascal Caffet, Best Worker of France in which Fauchon took 33% stake.

Fauchon carries today, 25% of its turnover in France and 50% in Japan, where it is established for decades through a partnership with department store chain Takashimaya but where growth prospects are limited.

To grow, the company looks to the Middle East, which accounts for 15% of its sales and where it intends to open over 20 stores in the next two years, in sales that could reach 30% of turnover within five years.

The appetite of this region in the world for sweet foods makes an ideal target for the confectionery and chocolate.

Besides France, Japan and the Middle East are the only regions in the world where Fauchon has a local manufacturing enabling it to offer fresh produce.Elsewhere, shops selling grocery products that can be exported.

BACK IN CHINA AND THE UNITED STATES

After a setback in China, where the company recently closed a large store opened in Beijing in 2007 – too large, misplaced – Fauchon has opted for a model shop "gifts" to smaller area. She has just opened one in Hong Kong and said to be in contact "advanced" with partners for openings in mainland China.

United States Fauchon also suffered a defeat and closed its shops in New York but wants to expand free "if you can find the right partner".

Russia, very hard hit by the crisis, also has the longer term, among the strategic development zones of Fauchon.

The NYSE has ended on a note undecided Friday, the Dow Jones 30 industrial yielding 0.05% or 4.99 points at 10,147.81.

The S & P 500 is broader took 3.15 points, or 0.29%, to 1076.84. The Nasdaq Composite Index was on its side of 6.06 points (0.27%) to 2223.48.

These data are likely to vary even slightly.

Sales of new homes in the United States has declined more sharply than expected in May and reached a record low with the end of a tax credit related to real estate, official statistics show, adding to fears a slowdown of economic recovery.

These sales fell by 32.7% to 300,000 annualized, against 446,000 (revised) in April, ending two consecutive months of increases.

This is their biggest decline ever in percentage since the launch of this statistical series began in 1963.

Economists and analysts polled by Reuters on average had forecast 410,000 annualized sales figure of 504,000 after the originally announced for April.

Since the buyers had to sign a contract later than April 30 to qualify for federal tax credit, which expired, observers expected a slowdown in new housing last month.

The median sales price of new homes fell 1% between May and April fell to 200,900 dollars. In one year, prices fell 9.6%, evening their biggest drop since July 2009.

Johnson Controls said to be still interested in some of Visteon's business despite rejection suffered by its offer of 1.2 billion dollars (one billion euros) on Tuesday.

In a statement, the American automotive supplier said it had sent a letter to his competitor in which it reaffirmed its proposed acquisition, without giving further details.

Visteon said Tuesday its rejection of the bid from Johnson Controls for its determination to stick to its own roadmap to exit from bankruptcy.

On May 21, Johnson was caught short financial analysts by offering to buy the business vehicle interiors and electronics.

Visteon, a leading supplier of Ford, was placed last year under the protection of Chapter 11 of U.S. bankruptcy law in order to reorganize its business and to clean up its balance sheet.

In the first three months of the year, the OEM posted a net profit of 233 million against two million a year ago.

More than six in ten French (63%) feel negatively action of Nicolas Sarkozy since 2007 on social policy, against 34% positive, according to a CSA poll published Cap Friday, June 4 by the Journalists Association of social information (AJIS) and DomPlus. When they think about the action of the President of the Republic since 2007 in social policy, 29% of the French as "very negative" and 34% "fairly negative", while 3% are "very positive" and 31 % "fairly positive". They have been 3% did not comment.

Read about our investigation: Why Sarkozy's policy is so unpopular

When asked specifically about various fields is in terms of purchasing power that the French seem most critical: More than three quarters (76%) perceive the action of the Head of State as "rather negative", only 18% consider it "somewhat positive".For a majority of French, is also rather negative opinion on the fight against unemployment (68% against 27%), the fight against poverty (69% against 26%), the incentive to work harder (60% cons 36%), dialogue between management and unions (57% against 30%, 13% did not). Concerning the effectiveness of the minimum service in transport during strikes, the action is seen as "rather negative" to 48%, against 40% (12% did not).

About the pension reform, only unions inspire "somewhat confident" a majority of French people (54% against 42% who have "not much confidence"), according to the poll. In contrast, over two thirds (67%) were "not much confidence" in the patronage of the reform, against 26% experiencing more confidence.At 64%, the French have not much confidence in Nicolas Sarkozy to reform, against 32% who tend to trust.

The leftist opposition also inspires rather not trust a majority of French, but to a lesser extent (55% against 38%). Of the decisions taken by the President to deal with the crisis, 49% of French people consider them bad, against 47%. Nearly one in two French (49%) said the French company less united than three years ago, while 37% say "neither more nor less" and 11% supportive.

The survey of the CSA institute and Cap for Ajisai DomPlus and was conducted by telephone 19 and May 20 from a nationally representative sample of 1,000 persons aged 18 years or older, constituted under the quota method.