News – Business & Economi

The decline in unemployment for the second consecutive quarter to hope that France moved into a sustained decrease, said Thursday Economy Minister Christine Lagarde.

The unemployment rate as defined in International Labour Office has declined to 9.3% and 9.7% in France with overseas in the second quarter against 9.5% and 9.9% in the first, announced Thursday INSEE.

"This is good news, especially now that a new repeating itself," said Christine Lagarde told Reuters.

"When is two consecutive quarters, there is reason to believe that not only stabilized but unemployment is perhaps past the right side of stabilization.People come, hopefully in permanently reducing unemployment. "

In a previous interview after the announcement of a decline in the number of jobseekers in Class A in July, 25 August Christine Lagarde had referred to "stabilize" trend that is becoming.

Asked to say at what level of growth in France was able to create lasting jobs, the economy minister said: "It is almost certain it was only 2% of net job creation sustainable, but look at the current period, to 1.4% pace of growth was the net creation of jobs.

"The French economy has created about 60.000 new jobs since the beginning of 2010 when it evolves at a rate of 1.4 to 1.5% growth, so somewhere between 1.5% and 2%, the French economy created jobs .

"What is important is that we can maintain this trend of declining unemployment and net creation of jobs," she added.

The government forecasts economic growth of 1.4% this year and 2.0% in 2011.

Several large European companies have released information Thursday surprisingly positive, triggering a sudden resurgence of investor confidence after months of pessimism fueled by the debt crisis and fears of an implosion of the euro area.

With these new found reassuring, have added good indicators for the month of July: further decline in unemployment in Germany and strong growth of economic sentiment in the euro area.

Economists point out however that this resurgence in good mood after the dark days of rumors of a default by Greece and other countries in the euro area should not be forgotten that economic recovery will be gradual given the austerity measures by several governments.

Among the big names who released Thursday, Publicis third global advertising agency, has raised its expectations for 2010 after having exceeded expectations in the first half to gain the favor of budgets and increased costs to its customers.

"Publicis has strengthened during the crisis," said chief executive Maurice Levy to the press.

"We really feel at the end of the economic crisis, or even having put completely behind us," he added.

These words are not isolated.

The Dutch group Randstad specializes in the interim, number two worldwide in its sector, said he did not see any sign of relapse of the economy.Companies are hiring, he said, particularly in Germany and France.

"GROWTH AROUND"

"We are seeing growth everywhere. Even in Greece, we see a normal development. We do not observe any signs of relapse," said Reuters chief financial officer, Robert-Jan van de Kraats.

The American Manpower, which carries the majority of its sales in Europe, acted last week did not see a downturn.

In the pharmacy, the French Sanofi-Aventis posted a higher quarterly earnings expectations – after Friday lowered its target EPS for 2010.His British rival AstraZeneca has posted higher profits.

The European chemical groups that have published their quarterly accounts have emerged Thursday globally strong results in favor of volume growth.BASF, the world first chemist, reported second quarter operating earnings adjusted for exceptional almost doubled to 2.2 billion euros, exceeding the consensus that gave it to 2.03 billion.

In Switzerland, Clariant has raised its annual recovery of the industrial sector and a weaker euro has boosted demand and that allowed him to reach a net profit in the second quarter, well below the consensus, however.

The German conglomerate Siemens Electrical has released an operating profit up 40% for its third fiscal quarter thanks to cost cuts and the weaker euro.

All these new feed more optimism among investors in Europe they appear a little less convinced of the strength of economic recovery in the United States.

The team responsible for global strategy at the UBS bank, raised its recommendation on Europe to "neutral", while she advised previously underweight assets of the region.

UBS said that the Ifo business climate in Germany, a closely watched index, in July recorded its biggest increase in 20 years, growth in gross domestic product in the United Kingdom grew at a rate twice higher than expected second quarter and the results of stress tests performed on the European banks have brought relief.

At the Deutsche Bank economist Gilles Moec wants cautious.

"There is no major change in the table macroeconomic background: we started to slow growth," said he.

European banking stocks were up, supported by the results of resistance tests conducted by the European authorities to restore market confidence.

Investors, who had initially criticized the methodology of stress tests conducted by the Committee of European Banking Supervisors (CEBS), believe that exercise helps alleviate fears about the solvency of banks.

Having suffered in mid-morning on concerns about exposure of Deutsche Bank in sovereign debt, the sector index Stoxx 600 European banks is again on the rise.

Around 12:50, the index has risen by 0.41%.

The Societe Generale and ING shares rose 2.97% respectively at 39.12 euros and 3.08% to 7.1280 euros.

The Santander, the first bank capitalization in the euro area remained stable at 10.11 euros after opening up to the Madrid Stock Exchange.

"The stress tests show that the French banks and European banks in general, are more truly threatened by a solvency risk," notes Simon Willis, NCB Stockbrokers analyst financial in a research note.

"It remains for banks to find sufficient levels of profitability, long-term effort that requires strategic reviews of activity and improvements in their organization," he says.

Analysts at Credit Suisse in turn emphasize that the publication of detailed exposure to sovereign debt will enable investors to better understand the needs to recapitalize banks and credit risks in the event of default on the debt of a State.

Of the 91 banks in the European Union subject to the tests, only seven property – five Spanish, one German and one Greek – have failed and could therefore be forced to raise 3.5 billion euros of equity.

Others were successful only just like German or Italian Deutsche Postbank Monte dei Paschi di Siena.

DEUTSCHE BANK ASSENTED

French banks BNP Paribas, Societe Generale, Credit Agricole and BPCE have all passed the test of successful resistance, which allows securities to outperform their benchmark.

BNP Paribas gained 0.86% to 50.22 euros, Crédit Agricole 0.94% to 9.44 euros.

The Franco-Belgian Dexia, which has also passed the tests, scores 2.6% to 3.39 euros.

In Germany, Deutsche Bank, which also passed the tests, is punished by investors for failing detailed its exposure to sovereign debt.The title and yielded 1.24% to 49.13 euros.

The Committee of European Banking Supervisors will also ask the German banks to explain why they did not give details Friday of their holdings of sovereign debt.

In conducting these tests, CEBS and the European Union have sought to ensure that large EU banks had sufficient capital to cope with a deteriorating economy would be worse than expected and new shocks.

Learning from the Greek debt crisis, the tests also incorporated discounts on the value of certain bonds held by banks.

Most members of the Federal Reserve have lowered their growth forecasts at the last meeting of the Monetary Policy Committee of the Fed FOMC minutes showed 22 and June 23 on Wednesday.

They also felt they should be prepared to take further steps to support the economy if economic conditions continue to deteriorate.

"Drawing the consequences of changes in the financial context, most participants have slightly lowered their forecasts for growth," the minutes show.

"The Committee will consider whether to adopt more supportive measures if the weather deteriorates."

Meanwhile, the Fed will continue to evaluate the methods currently available to it to drain a huge volume of loans it has injected into the financial system, says the U.S. central bank.

The Fed officials have lowered their growth forecasts for 20,110 to a range between 3% and 3.5%, whereas it previously predicted a rise in gross domestic product from 3.2% to 3.7% in May last.

The Federal Reserve expects the unemployment rate between 9.2% and 9.5% in the fourth quarter, more or less what it provided in its previous estimates.

The reflections of the Fed have weighed on the Treasury bill yield to thirty years, investors anticipating a continuation of interest rates at current levels until at least the end of the year.

"This suggests that rates will stay low for long enough and, if necessary, the Fed will try to invent new ways to support the economy," said Ward McCarthy, chief economist at Jefferies & Co.

The general tone adopted by the Fed is tinged with caution, the Fed merely saying that the recovery is underway.

It reiterated its promise to keep interest rates at a level close to zero for an extended period.

The U.S. recorded a budget deficit of 68.42 billion dollars in June, the 21th in a row, the Treasury announced.

But the deficit is down by 27% compared to 94.33 billion dollars in June 2009.

Over three quarters of the fiscal year ended September 30, the deficit amounted to 1.004 billion dollars against 1.086 billion in the comparable period of fiscal year 2009.

The latest projections for the deficit in 2010 will be given by the White House July 23 normally. In February, it expected a deficit of 1.600 billion dollars against 1.400 billion in 2009.

The Paris Bourse is stabilized in early trading Monday, after making its biggest weekly rise in a year last week.

The sentiment in the markets is nevertheless supported by the publication of a better than expected trade surplus in China and the prospect of good results season, which begins tonight in the U.S., with Wall Street after Alcoa.

Around 9:32, the CAC 40 index showed a decline of 0.14% to 3549.44 points, after opening at 3562.70 points (0.23%) and increased by 6.16% last week.

Banks weigh on the trend with a decline of 2.5% of Dexia, Credit Agricole 1.7%, 1.6% of BNP Paribas and Societe Generale 1.3%.

Zodiac Aerospace wins 1.85% to 40.520 euros after rejecting a merger offer from Safran (-1.7%).

Seb largest increase SRD wins 5.8%, while Goldman Sachs raised its recommendation from neutral to buy.

Other major European markets are closely irregular: London lost 0.02% while Frankfurt gained 0.12%. As for the European indices, the EuroStoxx 50 yields 0.15% and 0.11% Eurofirst 300.

The Euro drops to 1.257475 dollar against 1.2639 the day before the end of the day, while a barrel of U.S. light crude yields 52 cents to 75.57 dollars.

Industrial production in France has strongly rebounded in May, rising 1.7% after falling 0.5% the previous month, according to data CVS-CJO published by INSEE.

Twenty-two economists polled by Reuters had expected an average growth of 0.4% of overall industrial production in May, with estimates ranging from 0.0% to 0.9%.

The April figure was revised to -0.5% -0.3% instead announced a month ago.

Manufacturing output, that is to say, outside energy but with food included, rose 0.5% in May after a revised rise of 0.3% (+0.4% in the first estimate) the month precedent.