News – Business & Economi

The World Cup effect past the French household consumption of manufactured goods fell 1.4% in June and fell 0.9% on the entire second quarter, posting INSEE.

The disappointing figures, well below expectations, suggest a decrease in consumption of all households in the second quarter, including services and supply, which would be a first for two years.

Twenty-three economists polled by Reuters predicted an average increase of 0.2% in June, with estimates ranging from -1.8% to +1.0%.Initially announced at 0.7%, May's increase was revised to 0.6% after a decline of -1.4% in April.

Since the beginning of the year, spending on manufactured goods have registered only two months of increases in March and May The decrease of 0.9% over the entire second quarter followed a 1.9% decline in first.

"The consumer was dynamic in the last quarter of 2009 was considerably weakened when it has always been the mainstay of the business in France.It is a real concern, "said Dominique Barbet, economist at BNP Paribas.

In June, it is the consumer electronics and clothing that have seen their sales drop, taking over auto sales down sharply in early years after the decline of the "scrappage".

After a jump of 6.4% in May, largely due to purchases of televisions before the World Cup in South Africa, the post of home furnishings fell 3.6% in June, biggest drop since November 2002.

For the sole property of consumer electronics, the decline was 3.7% after a surge of 12.4% in May

DROP IN THE CAR Dyked

Spending on textiles and leather have in turn fell 5.0% in anticipation of summer sales that began June 30, five days later than in 2009, but this schedule gives hope for a rebound in July.

For the quarter, the home furnishings rose 3.0% but textiles and leather down 2.8%.

The decline in car sales for its part was contained in June (0.0% after -0.3% in May and -9.2% in April) but the decline reached 8.4% in the quarter, after already a fall of 11.5% in the first quarter.

The 0.9% decline in spending on manufactured goods in the second quarter fears of a decline in overall consumption, for the first time since the second quarter of 2008 when it fell by 0.1%, said Dominique Barbet.

Purchases of manufactured goods account for about one quarter of total household consumption of goods and services, which is much less volatile statistics and published quarterly in the national accounts framework.

In the first quarter, it had stagnated (0.0%), lower than 1.9% of purchases of manufactured goods was offset by an increase in individual consumption of energy.

INSEE, in his memo on the economy published in June, sees yet remain stalled in the second quarter before a rise of 0.3% in the next two quarters.

"The stabilization of consumer sentiment was announced yesterday is quite encouraging, but the outlook remains weak and not with this level of consumption we can expect 1.5% or 2.0% growth," observes the economist of BNP Paribas.

"Household consumption in manufactured goods grows with a horizontal trend since the first half of 2007, although movements in the car drove the second half of 2009," said Philippe Waechter, director of economic research at Natixis Asset Management.

"In relation to a consumer confidence still low, reflecting concerns about jobs and taxes, we can not imagine a rebound coming and it will penalize significantly the growth momentum in the second half."

Syngenta has lowered its targets on Thursday and now anticipates a decline in earnings this year due to a late start planting, the result of a severe winter, and the burden of taxation.

Around 8:15 GMT, the action accused the coup losing 5.21% to 229.40 Swiss francs, while the index grouping the European chemical values yielded 0.76%.

The planting season started late in the northern hemisphere, but demand has accelerated in the second quarter, especially in emerging markets, told Reuters CEO Mike Mack.

As a result, the Swiss agribusiness group, world leader in its field, now anticipates a strong second half, with good signs for the upcoming planting season in the Southern Hemisphere he added.

"We anticipate an operating profit of about that of last year but, instead, a decrease in net profit," he said.

A continuing evolution in Latin America and Asia should make it possible to Syngenta, which also produces genetically modified seeds, to offset a 13% drop in operating profit in the first half to finish the year with operating profit unchanged said Mike Mack.

Finance costs and tax rates should weigh heavier on the net profits, also said the CEO.

Net income declined 11% to 1.25 billion dollars in the first half, while the Reuters poll gave it to 1.38 billion.

Revenues increased 1% to 6.74 billion dollars, is there a little higher than the consensus (6.69 billion).

THE EMERGING TO THE DEVELOPED

Emerging markets such as Latin America and Asia-Pacific are increasingly important for the group."That was the year Syngenta could see its sales in emerging markets than those in developed markets," added Mike Mack.

Shares of agribusiness groups have declined this year due to stiff competition from cheaper Asian products and uncertainty about the regulations of GMOs (genetically modified organisms).

The slide has picked up speed after that Monsanto has sharply reduced its full-year in May and reported a 45% drop in quarterly net income in June.

German Bayer, which has a subsidiary agrochemicals, will release its second quarter results on July 28 and his compatriot BASF, also present on this segment, July 29.

The European Commission released this month a proposal under which the Member States of the European Union could soon have the ability to prohibit the cultivation of GM crops on their land without justification.

The action Syngenta trades at a PER 2011 around 12.5, below that of the U.S. Monsanto but over other European companies in the sector.

She lost about a fifth of its value since the peak reached in March this year.

Philips has released better than expected results for the sixth consecutive quarter and raised its margin target, but not so far succeeded in convincing the market hoped for more.

Around 9:15 GMT, the Dutch electronics group fell by 2.91%, to 24.175 euros after plunging 4.3% in the first exchanges to form when the largest decline of the Amsterdam Stock Exchange.

Victor Bareno, an analyst at SNS Securities, said that the published results did not reflect "the significant increase that Philips had reported in previous quarters.

The group recorded a profit before interest, taxes, depreciation and amortization (EBITA) of 527 million euros in the second quarter, against 118 million euros last year and 486 million euros expected.

Its turnover stood at 6.2 billion euros and net profit to 262 million euros, higher than the 241 million euros expected.

Analysts had warned before the publication of Philips that investor expectations may be too large.

"The magnitude of the excess (of analysts' forecasts) compared to the previous five quarters is somewhat less strong," said Jan Hein de Vroe, an analyst at ING.

Eleven of 13 analysts surveyed by Thomson Reuters StarMine SmartEstimates lowered on average by 22.6% their earnings expectations over the past 30 days, while the stock has gained almost 7%.

The Dutch consumer electronics was confident of being able to exceed its margin target of 10% EBITA before exceptional items this year, while previously thought just to reach this goal.

The European leader in consumer electronics has reduced the cost during the crisis and the beginning of economic recovery, which helped to generate profits even in difficult times.

Philips has hoped to exceed its savings target on its structural costs in 2010 to 700 million euros.

Sales of new cars in France have continued to rise in April, to 1.9% from April 2009, but at a much more slowly, reflecting an impact of declining car scrapping and leaving the uncertainty about the rest of the year.

"This figure is normal. We see a gradual reduction of the effects of scrappage" observes François Roudier, spokesman for the Committee of French car manufacturers.

The spokesman noted "a decline in registrations and orders on new line", small cars that benefited most from the car scrapping. Meanwhile, "we see a rise in average range on some models," he adds.

Carlos da Silva, an analyst at IHS Global Insight, a judge even when the result of April "a little surprising" and speaks of "semi-surprise"."The compact segment is doing rather better than what we expected" while "small cars to fall again mechanically," he notes.

Moreover, "manufacturers have continued to put much money on the table to try to compensate" the premium reduction. They have indeed offered to their customers numerous discounts and promotions. In this context, May will be "a little month of truth," said Carlos da Silva, who expects a decline it expected in April.

"I do not see how that can withstand much more, plus there is not really new models," he said.

French manufacturers are considering a European market decline 9 to 10% this year.1,000 euros last year, the scrapping bonus increased to 700 euro from 1 January, but for vehicles ordered before December 31, the premium remained at its former level for deliveries until the end of March.

This measure was prompted a boom in orders at the end of the year, registrations recorded in the first quarter up 17%. In the first four months of the year, the increase was 12.9% compared to the same period of 2009.

The Minister of Industry Christian Estrosi welcomed in a statement of "the good performance of the market", which "demonstrates the effectiveness of the government strategy of gradual withdrawal of the scrappage scheme".

On 1 July, the scrappage decline further, to 500 euros.

The month of April has been more favorable to French brands, up 8%, as foreign brands, down 4.9%.Of the 190,986 new cars registered last month, the French brands accounted for 56.1% of the market.

The increase was 17.2% for the Renault group and 7.3% for PSA Peugeot Citroen. At Peugeot, we judge that "the effect of scrappage continuous" and "concerns an order for two 206 + and 207," the Director of Commerce France, Olivier Veyrier, said in a statement.

The WTO has ruled that some European financial aid granted to Airbus could be regarded as illegal subsidies and demanded the withdrawal of a portion of them within 90 days, according to a source close to an expert report .

Following this confidential report of a committee of the World Trade Organization made public Tuesday, the aid should theoretically disappear within three months are export subsidies, illegal in all cases, the source added.

Other grants, which, more generally, would undermine U.S. interests must also be removed but the WTO does not set a deadline for doing so, says the source.

This report of a thousand pages will not be released until weeks or months.A copy was sent to both parties involved.

But since the committee has not taken over the whole of American complaints, it is likely that the dispute between Airbus and Boeing is not close to being closed.

In any case, the opinion's expressed Airbus, who contends that 70% of complaints by the United States were rejected by the WTO.

"Airbus is convinced that this battle brought before the WTO (World Trade Organization) could take several more years," says the aircraft manufacturer."As with all trade disputes, resolution will be possible only through transatlantic negotiations.

PREVIOUS LITIGATION

Boeing welcomed the report of the WTO Committee, calling it "landmark decision and good news for employees of the aerospace sector in the United States who have faced decades of competition from Airbus heavily subsidized.

Grants are at the heart of the battle between the two aircraft manufacturers in the market of civil aviation, as estimated by the aerospace companies to 3.000 billion dollars (2.200 billion euros) over the next 20 years.

The United States accuses Airbus of getting a total of 205 billion dollars of soft loans and other aid from the France, Germany, Spain and the United Kingdom over two decades.

Thus, this dispute is by far the most important being that feed international trade.

The European Commission said it had no conclusions to be drawn immediately. "The contents of the report is confidential of course.One thing is certain: we must be careful not to draw hasty conclusions or to declare victory prematurely, "said John Clancy, spokesman for EU trade issues.

John Clancy added, as expected, we would have a clearer picture of the situation after the WTO has issued a progress report in the coming months, a contentious open this time by the EU against subsidies granted to Boeing.

The final resolution of the two procedures, which could still go through a negotiated settlement, will define the market rules of civil aviation, where Airbus and Boeing have order books totaling nearly 1,000 billion dollars in the years come.

The A350 OUTSIDE THE COUP

The Committee of Experts of the WTO had communicated to both parties a progress report in September. The report remained confidential for the most part, considered that the aid given by European governments to Airbus constitute export subsidies undue Had they said a source familiar conclusions.

However, according to source close to the report released Tuesday, the WTO panel ruled that such funding of future programs such as the Airbus A350 was outside the scope of its recent decisions, which implies that trade tensions with Boeing likely to last.

"The future financing of the A350 is in no way affected by the findings of the report submitted today," Airbus also reacted to this."Attempts by the United States to include the A350 in this complaint have been specifically rejected.

European and U.S. officials had given their own interpretation of the report before it is published.Washington said it proves that Airbus had violated the interests of American workers, while Airbus noted that the report was a step in a lengthy procedure.

The most likely outcome is that both sides will probably call each of their side, in two contentious open on both sides of the Atlantic, leading to procedures that could take years.

"Airbus and the EU member states now conduct a thorough analysis of the ruling in order to anticipate any possible review of the decision by the Appellate Body of WTO," Airbus said in its statement.