News – Business & Economi

GDP in the euro area has stagnated in the first quarter after falling 0.3% last quarter. But the performance of different countries are very different.

Based on preliminary estimates released Tuesday by the European office of statistics to Eurostat, the euro area recorded no growth (0.0%) during the first three months of the year, after a decline in GDP of 0.3 % last quarter. This figure, better than expected by analysts (-0.2%), allows the euro area narrowly escaped the recession, which is recognized when GDP shrinks for two consecutive quarters. But mostly he hides significant disparities between countries in the euro area: while Germany saw its GDP grow by 0.5%, exceeding all expectations, thanks to exports and consumption, France experienced no growth (0%) and Italy sank into recession (-0.8%).

The Netherlands has also experienced poor performance (-0.2%). As for Greece, she recorded a fall in GDP of 6.2% in the first quarter, according to preliminary official estimate.

These differences show that "the region remains highly dependent on Germany," said Jennifer McKeown of Capital Economics. "A big thank you to progress better than expected German GDP," added Martin Van Vliet of Ing.  

Figures released Tuesday should at least contribute to the debate on growth in Europe, a topic that has emerged slowly while facing austerity, especially under the leadership of French President Francois Hollande.

The latter reiterated its position on the issue during his inauguration speech Tuesday morning at the Elysee Palace. "To our partners, I will propose a new pact that will combine the necessary reduction of public debt with the necessary stimulus," he said. "To overcome the crisis that afflicts it," he said, "Europe needs projects, it needs solidarity, it needs for growth."

The subject should be central to its discussions on Tuesday afternoon in Berlin with Chancellor Angela Merkel, the main advocate of fiscal discipline in Europe, who reluctantly welcomed his proposal to add a growth component in the European budgetary treaty. How to revive European growth will also constitute the main theme of the dinner which will bring together European leaders in Brussels on May 23

The Italian leader, Mario Monti, proposed last week to "unite people of good will" to ensure that it is "compatible" with fiscal consolidation. He is scheduled to meet Tuesday in Brussels with European Commission President Jose Manuel Barroso, whose proposals for growth (increased resources for the European Investment Bank, finance major European projects, tax on financial transactions , better use of EU funds) are widely shared by Mr. Holland.

European leaders will anyway have to be proactive to defy predictions of analysts. To Martin Van Vliet, there is "no evidence of strong and sustained economic rebound on the horizon for the euro area".

As for Howard Archer, IHS Global Insight, thinks that "a contraction of GDP will likely be on the menu in the second quarter." Although a gradual return to growth is expected later this year, "a further escalation of the debt crisis, not counting an output of Greece (the euro area), could derail the expected recovery," puts cautioned Mr. Van Vliet.

Since same day cash advance is a high risk loan for the lender, the interest rates charged are high. The lender has no security and does not even conduct a credit check.

German Chancellor Angela Merkel is opposed to programs to support economic activity in Europe but it is ready to discuss a strengthening of the European Investment Bank Investment Bank (EIB), she says in an interview published Wednesday in the daily Hamburger Abendblatt.

She explains that in his view, the growth can not depend solely on stimulus costly for public budgets.

"It is important that we distance ourselves vis-à-vis the idea that you should always spend money to get economic growth," she said, according to excerpts from the interview released before its publication. 

"Sustainable growth is based more on education and research and innovation capacities of SMEs."

Germany, who had fought the 2008-2009 recession with a stimulus package of 81 billion euros, took the lead of states shifting the focus to fiscal austerity measures against ; the sovereign debt crisis.

But an increasingly hostile public opinion and certain officers to austerity in several countries in the euro area has reopened the debate on the advisability of measures to support growth . 

In France, the favorite for the second round of presidential elections, the socialist Francois Hollande, wants to engage if elected Sunday a renegotiation of the European fiscal pact meant facilitate the reduction of deficits. It also advocates that the European Central Bank (ECB) do more to support economic activity.

Angela Merkel warned against any relaxation of the fiscal pact, it is preferable to consider measures mobilizing "political courage and creativity more than billions."

She argues for including the removal of barriers to youth employment and the strengthening of vocational training systems, to further open the labor market. 

Repeating remarks already held the last weekend in another interview to the press, she told the Hamburger Abendblatt that Germany was in favor of strengthening resources EIB, the financing arm of the European Union in the field of investments, as well as a more flexible use of EU structural funds.

Luxembourg Prime Minister Jean-Claude Juncker, who chairs the Eurogroup of finance ministers ruled Monday as possible an increase of 10 billion euros from the EIB's capital.

Wall Street opened Friday declined amid concerns related to persistent budgetary situation of Spain and slowing growth in China.

In early trade, the Dow Jones dropped 0.46% to 12,890.00 points. The Standard & Poor's, wider, yielding 0.47% to 1,379.40 while the Nasdaq composite retreated 0.48% to 2725.50.

Performance of public debt to 10 years Spain has exceeded 5.9% after the publication by the ECB shows that Spanish banks have been steadily increasing their borrowing at the ECB in March.

Moreover, the gross domestic product (GDP) of China rose 8.1% annual rate in the first quarter, the lowest figure recorded in nearly three years.

"The number of Chinese GDP is weaker than expected while anyone had used it as pretext to rise yesterday," said Peter Boockvar, equity strategist for Miller Tabak & Co. 

Bank stocks are also oriented downward despite better than expected results published by JP Morgan Chase & Co. and Wells Fargo.

Both titles lose respectively 1.18% and 1.88%.

Google also declined, its quarterly earnings above the consensus being overshadowed by a further deterioration in the profitability of its advertising links. The action gives up 2.8%.

The Bank of England (BoE) kept no surprise Thursday its key rate to 0.5%, its level since March 2009, and left unchanged the amount of its program of asset purchases, while the multiply signs heralding a return to growth of the UK economy.

All economists polled by Reuters had expected the central bank does not increase its program of "quantitative easing" (QE) beyond the 325 billion pounds (394 billion euros ) previously announced.

Recent indicators, including the latest PMI figures released this week, seemed to reflect a rebound in activity after the contraction of the last quarter of 2011. 

But British manufacturing output posted its biggest drop in nearly a year in February (-1.0%), taking forecasters against the foot.

Industrial production, wider, however, remained on an upward trend, which should be sufficient to ensure an increase in gross domestic product in the first quarter after the contraction experienced in late 2011.

Economists now monitor the evolution of inflation, still above the 2% target of the central bank and that it could announce an extension of buyback program securities.

The number of Spaniards registered as job seekers experienced the eighth consecutive month of increase in March, companies across sectors continuing to lay off trying to resist the worsening crisis .

The increase in the number of registered unemployed was 0.8% in March from February, 38,769 more job seekers. There are a total of 4.75 million unemployed Spaniards, according to figures from the Ministry of Labour.

The unofficial unemployment rate, which includes the unregistered unemployed, rose to 22.9% in fourth quarter 2011, the highest rate of all countries of the European Union.

Nearly a third of people in 17 countries in the euro area private employment are Spaniards and half of Spaniards under 25 are unemployed, according to Eurostat statistics.

The austerity plan announced Friday by the Madrid government to reduce the budget deficit, which includes a significant decrease in state spending, is likely to affect growth more Spanish . A reform of the labor market to make it more flexible may also enhance the rise in unemployment in the short term.

"Unemployment will continue to increase because it would grow around 1.4% or 1.5% to create jobs and it does not seem feasible before 2014," said the economist of Citi, Guillaume Menuet.

"The brutal reforms of the labor market generally results in more unemployment in the short term," he adds.

The Spanish government expects an economic contraction of 1.7% this year, a forecast more optimistic than Citi, which expects -2.7% in 2012 and -1 , 2% in 2013.

The Parisian house prices are falling for the first time since 2009. This trend can it last? The responses of Sébastien de Lafond, President of MeilleursAgents.com. Paris Real Estate, Second District, Point Trigano.

After the delirium, appeasement. The Paris property prices are going down, all professionals are unanimous, including notaries. The period October 2011 to January 2012, the price per m2 of housing in Paris and has declined slightly, to 8340 euros/m2, instead of 8370 euros previously. This represents a 0.3% decrease. The capital rappoche so the trend throughout the Paris region (-0.6% over the same period). Certainly, the decline is limited, but it denotes with previous years of sharp increase. The notice of Sébastien de Lafond is President of MeilleursAgents.com.

What do we see on the Paris market?

The Paris market has long been an exception to the French property market. If you look at the figures for previous years, between the third quarter 2009 and third quarter 2010, prices rose by 13.8% in Paris. And in 2011, the increase was 15% for old apartments. Result, the price per m2 in Paris reached 8,344 euros. The left bank has skyrocketed. First explanation: the exploding demand, strong excess relative to supply, fueled by several factors: historically low interest rates, a preference for stone instead of the stock market, investors have never been as many ( 26% of buyers, against 16% in all of France). All in a context of shortage of housing. In Ile-de-France, we need 70,000 homes a year to meet demand, then we do not built for that half hour. Another factor increase: foreign demand, which influences prices in many districts, the first in the eighth arrondissement, the 16th-but also and especially on certain types of property high-end or central ashore. This is a customer with high purchasing power, thus likely to distort the market structure high-end. Still, foreigners account for barely 5% of buyers.

The price on the Paris market have they peaked?

Today, no doubt, this market is cooling and has been since last July. The last six months, prices in Paris intra muros lost 3.5%, even lower in the inner suburbs and it is around 5% in the outer suburbs. Similarly, the transaction time is 50 days in Paris twice a year ago and 40 to 80 days in the Ile-de-France. In nine out of 10 districts, prices declined in the fourth quarter of 2011 versus the third quarter of that year. The volume of property transactions fell 15% in Paris and 20% in small and large crown.

How can we explain this decline?

On the one hand, we lost 30% of buyers from last year. First reason: the prices in Paris and the Ile de France have reached very high levels. For proof, from June 2009 to June 2011, they increased by 29%. Given this rise, many buyers say "stop". Another reason to be bullish: the banks are much more restrictive in terms of access to mortgages since the Greek crisis. Now, exit the small arrangements if you are on probation or if you have a low intake. Have a permanent and present a contribution of 5 to 10% is the rule in any bank. Moreover, the monthly credit shall not exceed 1/3 of disposable income of the borrower. Finally, we lost about 10% of buyers due to the suppression of PTZ + in the former, which was included last year in 40% of real estate transactions in the former.

On the other hand, the decline was due to the 20% of sellers and less. The sale is generally followed by a purchase. But in an economic context is not conducive to going into debt over twenty years, coupled with a fear of the future and an uncertain economy, people are more cautious. Finally, the election deadline pushes the real estate project.

The decline in the market Ile can it continue?

We announce a drop of about 5% to 10% of Paris and the Ile-de-France at least until June But this drop will not be sustainable if rates continue to decline as is currently the case in most banks. Because if interest rates fall, prices rise. However, if they increase, prices are revised downwards. This hypothesis is highly possible with the economic crisis in Spain today. The rate of OAT, (the rate at which borrows France over 10 years) may increase. However, if lending rates rise by 1%, prices could fall by 15%.

Beyond these predictions, the basic problem remains, we have a deficit of housing particularly marked in the Paris region market. Given migration, birth rates, etc.., Demand for the stone is too large to attend a substantial fall in prices in Paris, in small and large crown. The new housing shortage keeps prices. It is for this reason that the drop is, and will only be on if the new housing construction remains at this level. Buyers should not expect a substantial fall in prices. Today the market is experiencing a slight decline. This is a good time to buy in Ile-de-France.

But who can still buy in Paris?

In the capital, buyers under 30 have almost disappeared but the secondo-time buyers drive the market. Those buy for resale and are immunized against rising prices. We defined three categories of buyers. High-income couples, 30 to 40 years, may in turn seek apartments from 60 to 100 m2 through debt of 20 to 25 years. The secondly-time buyers who bought there over five years and can make a nice capital gain are now the most dynamic part of the application. But they are experiencing shortages of goods. Finally come the investors with a medium-to long term.

Hannover Re has refrained from any forecast for 2012, citing the possible IPO of Talanx, the German insurer which is its majority shareholder.

Talanx owns 50.2% of the third global reinsurer.

Hannover said Wednesday he planned to pay a dividend of 2.10 euros per share on the results of 2011 against 2.30 euros in 2010, when net income was integrated ; a capital gain tax.

Net income for 2011 is 606 million euros, according to preliminary results published on 13 February and well above its target of at least 500 million .

The Tokyo Stock Exchange ended on a sharp rise from 2.01% Thursday, buoyed by optimism about employment in the United States and the level of participation of private creditors to Greek debt exchange.

After three sessions of declines, the Nikkei index is back above the 9,700 point mark, gaining 192.90 points to 9,768.96 and the Topix broader, took 13.45 Points (1.63%) to 836.16.

The trend was also supported by a Wall Street Journal suggesting that the Fed is considering a new approach to bond buybacks.

Values, the technology has benefited from a presentation by Apple's new version of its iPad tablet.

Toshiba took 1.77% and 4.1% Electronics Renesas.

The values ​​of the day Friday at the Paris Bourse, where the CAC 40 closed up 0.04% to 3501.17 points, while he had not completed beyond 3500 since die ; goal in August, after a week marked by the second operation of loans to three years of the European Central Bank (ECB).

Over the whole week, the CAC 40 gained 0.98%:

* Values ​​BANK supported the coast, always carried by the second massive injection of liquidity to three years of the ECB, especially as their valuations remain low despite their strong rebound since the first of LTRO mid-December.

SOCIETE GENERALE took 1.34% to 25.395 euros, Credit Agricole 4.945% to 0.86 euros and BNP Paribas 1.50% to 37.915 euros. 

Dexia has won 5.32%, largest increase in the SBF 120, to 0.297 euro. Dexia Credit Local, its French subsidiary, launched a takeover offer for 700 million euros of subordinated notes issued in November 2005.

* Veolia Environnement won 4.74%, largest increase in the CAC 40, to 11.050 euros, having continued its flight after a gain of 14.86% yesterday in anticipation of a recovery group of utilities.

WestLB raised its recommendation from "neutral" to "accumulate".

Its major competitor SUEZ ENVIRONMENT has won 3.51% to 11.800 euros.

* Vivendi has lost 0.97% to 14.360 euros, the second biggest drop in the CAC 40 index, behind EADS (-1.43% to 27.650 euros). The title had already fallen by over 10% yesterday on the prospect of two turbulent years ahead. JPMorgan cut its rating to "overweight" to "neutral". Barclays, Cheuvreux, Deutsche Bank and Nomura have lowered their price target.

* AREVA has gained 4.73% to 20.020 euros, despite mixed results in 2011, after confirming its targets for the period 2012-2016 in a difficult global context.

* NEOPOST rose 1.77% to 52.420 euros after a turnover in 2011 better than expected and the prospect of further growth this year.

Gilbert Dupont raised its target price from 55.60 to 57.90 euros.

* IPSOS, lost 3.32%, largest drop in the SBF 120, to 26.170 euros, having continued to decline from the previous day (-1.33%) after a disappointing forecast operating margin rational 2012, of the order of 10%. Cheuvreux is no longer for sale.

* Technicolor has won 5.73%, largest increase in the SBF 120, to 2.305 euros, while Barclays raised its price target to 2.19 euros.

The main European stock markets opened on a rebound Friday in the wake of Wall Street and Asian markets, investors anticipating an abundant liquidity injection of long-term European Central Bank (ECB) the next week.

Around 9:15, the Paris Bourse gaining 0.53% to 3,465 points, Frankfurt and London takes 0.86% 0.18% advance. The pan-European Euro Stoxx 50 index rose 0.62%.

In Paris, Technicolor was down almost 5% after the announcement of an EBITDA down 5.9% in 2011 to 475 million euros. The action is Eiffage it head increases the SBF 120, the construction group has forecast a rise in net profit in 2012 after declining in 2011.

Banks are among the highest increases in Europe sector (0.86%). Deutsche Bank and Barclays gained 2.8% 1.4%. The Paris BNP Paribas and Societe Generale gaining 1.4% and 1.9%.

Lloyds Banking Group ahead by 1.3% after yet warned that its net banking income would decline in 2012, suffering, like his counterpart Royal Bank of Scotland, a heavy loss in 2011.

BASF takes 2.8% after announcing Friday that its results and its turnover increase this year thanks to a rebound in the second half.

Many analysts believe the weakness of the European economy will force the ECB to continue easing its monetary policy. The market is expected to lend some 500 billion euros to banks at its second financing package to three years scheduled for next week.