Paris opened on Monday morning, down 2.30%. If no decision within the euro area on the second bailout of Greece announced a new black day. The trading floor in Frankfurt
Divisions within the euro area on the Greek case and the problems of sovereign debt have to plunge again European stock markets Monday morning at the opening, banking stocks are once again very abused. The Paris Bourse opened a decline of 2.31%, 2.26% Frankfurt, London, 1.35%, Milan and Madrid by 2.6% from 2.51%.
In Paris banking stocks were the front line, BNP Paribas lost shortly after opening more than 3% and Societe Generale more than 6%. Same as in Frankfurt where Deutsche Bank lost 4.58% to 23.95 euros while that of Commerzbank fell by 4.36% to 24.01 euros.
"If no decision within the Ecofin early advocates for a tough week in the financial markets," said Christian Parisot Monday, economist at Aurel-BGC. The results of a meeting of EU finance ministers who were to consider the Greek case and the situation in the euro zone where European leaders have shown once again divided and little progress on the second aid plan Greece had already begun to engage in part the modest revival of optimism late last week.
European shares had done so in a disorganized, earning 1.18% Frankfurt, London and Madrid 0.58% 0.61% while Paris fell by 0.48% and 0.65% in Milan. Caution was also put in Friday on the eve of the weekend on Wall Street, where the Dow had gained 0.66% and the Nasdaq 0.58% at closing.
Monday, while no major economic indicator is expected, investors will be especially attentive at 1400 GMT, the Speech from the President of the United States, Barack Obama, which should offer a new deficit of 3.000 billion.
Bank stocks were the main victims of a new Black Monday stock market. But according to Dominique Dequidt, fund manager at KBL Richelieu, concerns about them are exaggerated.
Fears about the banking stocks have been very heavy on Monday on all European markets. In Paris, Societe Generale tumbled 8.64% to 20.25 euros, signing the largest decrease in the CAC 40. BNP Paribas lost 6.34% to 31.30 euros, Crédit Agricole (-5.51% to 5.84 euros) and Natixis (-5.68% to 2.55 euros). In the background, the difficulties of Greece, the threat of a lawsuit in the United States against 16 banks – including Societe Generale – for their responsibility in the subprime crisis, and the desire to recapitalize European banks by the IMF .Dominique Dequidt but remains optimistic.
What are the fears about banks today?
First, the gradual disappearance of the sovereign rating in Greece opened the door to further degradation, Ireland and Portugal in the lead. This is one of the great fears in the market today. Investors fear losses that may result in banking stocks that are exposed. Indeed some of the U.S. money market funds that had liquidity of investments in Europe have rather taken off the market last week. The second point is the deterioration of the American note in the summer. She amplified these fears and stoked fears of slowing global growth.
These fears are justified?
It is not really justified, at least in the short term. It is mainly a crisis of confidence that undermines the market.But look closer, banks are healthy. When we look at the credits granted by banking institutions in Europe, there is no need to panic. They rose 3% in the first quarter and 4% in the second. And despite a rather European growth at half the second quarter.
Banks are robust enough to withstand the risk of European sovereign debt and the threat of global recession?
Yes, in the event that we are not witnessing a collapse of the banking system. But there is no need to be as alarmist as the IMF on the recapitalization of banks. They have made big profits in the first half. BNP Paribas, despite its 450 million refinancing of provisions in the Greek debt, posted a profit of more than 2 billion euros in the first quarter.
But banks are very fearful to lend to each other.The level of cash placed with the European Central Bank has now reached 151 billion euros …
We are in a tense situation since the beginning of August the fears are heavy on the strength of some banks. Hence the difficulty they face to lend to each other. This level is certainly high compared to six months ago. But we are still far from the amounts of their outstanding 2008 in which the ECB had reached astronomical levels.
The trial of the U.S. federal government against 16 global banks – including the general society – he may weigh on an already difficult climate?
I do not think, at least for France and Europe. They are not involved in the trial. And regarding the risks of fines, it is called, in the extreme case, a fine running into hundreds of millions of euros.This is a difficult but there is no major concern to have.
To what extent can we expect an impact on the real economy if the situation worsens?
Banks have made a big effort on their balance sheets, it is not in the same situation of overheating than during the crisis. They are now well prepared for the state of distrust of the markets. But the phenomenon of double-dip recession may occur. 3 months ago investors imagined a soft landing in growth after the good figures of 2010. Today expectations are more cautious, and go up to imagine a recession in 2012.
Total will extend all over France its network of service stations at low prices, after tests conducted last year in dozens of outlets, according to an article to be published Friday in Les Echos.
"Total is preparing to set up a network of about 500 service stations at low prices in the Hexagon in 2012 to compete with supermarkets, several union sources indicate" the business daily reported.
This project must be presented to trade unions at a works council on Sept. 9, according to Les Echos, which said it will not apply to motorway service stations.
Japan will act firmly against any speculation on currency markets, said Monday the Minister of Finance Yoshihiko Noda, thus demonstrating the will of Tokyo to fight against the soaring yen.
Yoshihiko Noda, who believes the upward trend of the yen as more and more unilateral, also indicated that Japan was in close contact with other countries on this issue.
"We will monitor the markets even more closely than before to detect any speculative activity.We leave open any measure, and we will act decisively when necessary, "he said.
The phrase was repeated several times during the day by the Minister of Finance himself, but also by the Prime Minister Naoto Kan and Secretary of the Government Yukio Edano.
Friday the yen hit a new historic high of 75.95 against the dollar. Anticipating action by the Japanese authorities, the markets have brought the dollar to rise to 77.23.Shortly before 0800 GMT, the dollar was trading against 76.70 yen.
Signs of strength in Tokyo, however, did not allow the equity markets to hide the fear of a return to the U.S. recession, and the Nikkei closed Monday down to a low of five months .
August 4, Tokyo intervened unilaterally in the currency market, but the operation did not prevent minvestisseurs continue to buy yen a safe haven in times of crisis.
According to Kyodo News, the trade minister said Monday Banri Kaieda coordinated action with the U.S. on currency markets would be preferable.
The names of Banri Kaieda and Yoshihiko Noda are most often cited to replace Naoto Kan when it leaves the head of the government, perhaps by the end of the month.
The CEO of Starbucks garnered supporters after his call for a suspension of donating money to American politicians until an agreement "fair" be struck between Democrats and Republicans on the debt and the budget.
In a letter made public Monday, Howard Schultz, who led a painful restructuring of the first global chain of coffee shops, also called on U.S. contractors to support the economy by hiring.
The head of NYSE Euronext Niedrauer Duncan and his counterpart Robert Greifeld Nasdaq OMX has already expressed support for this initiative.
"I think the idea of Howard is good and I told him he could count on me," writes Robert Greifeld in a letter to executives of Nasdaq.
The call of the CEO of Starbucks is in addition to other interventions of senior private sector leaders who have moved strife torn with Republicans and Democrats in the debate over raising the ceiling of U.S. debt.
These divisions have contributed to plummeting consumer confidence to lowest in more than 30 years and have been cited by Standard & Poor's among the reasons which led to lower sovereign rating of the United States.
This weekend, the New York Times published a paper in its pages of one of its editorial on the call to Howard Schultz, in addition to an editorial in the American billionaire Warren Buffett for a higher taxes on the wealthy, including himself.
"These are highly respected leaders and they want something," said Todd Morgan, director and founder of Bel Air Investment Advisers in Los Angeles, whose company manages the portfolio of households with assets exceeding $ 20 million.
"I think other business leaders will follow suit and require Washington ambitious decisions, which could restore confidence in the economy of our country," he adds.
In his letter, Howard Schultz invites business leaders to engage with him "to suspend any further campaign contributions to the attention of the president and all members of Congress until a fair and bipartisan agreement be concluded that puts our country on more solid fiscal foundation for the long term. "
Howard Schultz CEO also urged his colleagues to invest in new projects or products that will draw up the economy at a time when the fears and uncertainties discourage companies from investing, consumer spending and banks to lend.
"Record levels of cash piling up in business, unused," said the head of Starbucks. "The only way to stop this circle of fear is to break it."
Following a meeting with congressional leaders, the White House Saturday criticized the "reckless political games" of the U.S. Congress on the thorny issue of raising the debt ceiling of the United States.
President Barack Obama continues to oppose a short-term renewal of the ceiling of the debt, according to a statement from the White House could lead to a deterioration in the rating of sovereign debt by U.S. agencies notation.
"Congress should stop playing recklessly with our economy, it would be better off to show responsibility and do its job – namely to avoid a default and reduce the deficit," said Jay Carney, spokesman for the House white.
For his part, John Boehner, Republican chairman of the House of Representatives, said he sought with other congressional leaders to find a solution "bipartisan" – beyond the party lines – to raise the debt ceiling of By the deadline of August 2 and avoid a failure of the United States.
In a statement issued after the meeting with the head of the U.S. executive, John Boehner says: "The leaders of the House and Senate will work to find a bipartisan solution to significantly reduce spending in Washington and preserve the full faith and credit enjoyed by the United States. "
The U.S. president has gathered around him the chairman of the House of Representatives, Republican John Boehner, Harry Reid, Democratic majority leader in the Senate, Vice President Joe Biden and Nancy Pelosi, minority leader in the Democratic House of Representatives.
If Congress does not fall by 2 August the ceiling of the debt of the United States, currently set at 14 300 billion, federal agencies can no longer be funded.Investors remain confident that an agreement will be reached on time but the concern is gaining the markets, a U.S. default on their debt is likely to trigger a global economic shock.
The United States now face the "real risk" to see the bill for its sovereign debt broken down by rating agencies, said Friday an official from the White House.
Democrats and Republicans agree that raising the debt ceiling begins with a budget deficit reduction but both sides fail to agree on how to get there.
Barack Obama and John Boehner appeared to move toward a deficit reduction agreement for $ 3.000 billion dollars but voices were raised in the Democratic camp to protest cuts in welfare benefits without immediate increase of taxes in return.
The president said he had submitted a proposal "extraordinarily fair" to John Boehner, but he was clear on Friday that the Republican had broken off negotiations once it had stopped responding to phone calls.
To avoid a failure to pay the United States, U.S. senators plan to allow President Obama to decide one of raising the debt ceiling to 2.5 trillion dollars in three installments. Capitol
Trench warfare on raising the U.S. debt ceiling continues this week in Congress, where elected officials are working on a "plan B" to bypass the blockage and prevent a failure to pay the United States after August 2.
The political impasse remained Monday despite warnings last week of rating agencies, pressure from China, warning the administration against an Apocalypse if unpaid bills by the federal government. Monday morning, U.S. treasury secretary, Timothy Geithner, has nevertheless ensured that an agreement would be signed."Nobody is going to play stupid on this issue," he said on CNBC, saying again that default would be "catastrophic" for the country.
In the Senate, Majority Leader Democrat Harry Reid, took the issue seriously Monday by declaring that the upper house would remain in session "every day, including Saturdays and Sundays until (…) Congress passes a bill that prevents the United States to shirk its obligations. "
Faced with deadlock, Mr. Reid and his fellow Republican Mitch McConnell of attempting an operation last chance to reach a formula acceptable to both sides. This "plan B" would give the president the power to rise three times the maximum debt of 2,500 billion dollars by next year.But it would leave only the responsibility-and risk-policy of raising the debt ceiling.
The Senate plan could also include spending cuts of up to 1,500 billion over 10 years, measures on which both sides agree. The ultra-conservative movement of the "tea party" very influential in the House, however, condemned the plan of withdrawal.
For its part, the spokesman for the White House, Jay Carney, assured that the president continued to "call the broadest possible agreement". But according to Carney, the president wants to ensure that there is "a backup plan" such as that of Senator McConnell, even if this plan is not his preference. This could be examined by the middle of the week.
But before that, Tuesday, the House of Representatives will vote on the latest proposal of the Republicans, entitled "Reduce, cap, balance."The symbolic text, which should be rejected by the Senate to Democratic majority, would require such an amendment to the Constitution to the federal budget is in balance, as well as strong cuts.
The inevitable failure of this plan will only emphasize the gap between Democrats, who demand a policy of deficit reduction focus on more tax revenue, and the Republicans, who do not want to hear about tax increases but only draconian budget cuts. The White House pressed the point home Monday warning that Obama would veto the text, in the highly unlikely event that the Senate would approve.
Republican John Boehner said he was "disappointed" in a statement Monday about the threat of the president, accusing the White House to lack "serious" and to avoid difficult decisions."We're making progress," but Obama said Monday during a brief interview with the press.
CBS News poll released Monday, 71% of Americans disapprove of the way Republicans in Congress led the negotiations. Democrats register them a negative score of 58%. Since mid-May, the U.S. federal debt, to 14.294 billion dollars, has reached the maximum allowed, an issue that the Treasury is unable to circumvent that through hocus-pocus of short duration.
The New York Stock Exchange ended Friday up 0.36%, the Dow Jones Industrial 30 45.03 points to 12,482.15 winner.
The S & P-500, wider took 7.53 points, or 0.58%, to 1316.40.
The Nasdaq Composite Index was up 27.34 points for his side (0.99%) to 2790.01.
For the week, the Dow lost 1.4%, the S & P 500 fell 2% and the Nasdaq 2.4% sold.
These data are likely to vary even slightly.
RWE, the fifth European group of utilities, said Thursday that he yielded to a consortium of financial investors 74.9% of high-voltage network Amprion Germany.
He added that the transaction, valued on the basis of an enterprise value of around 1.3 billion euros, will probably close in the third quarter.
A consortium of insurers take over the network, which comprises some 11,000 km of power lines.
A source familiar with the matter told Reuters on Wednesday that the German group could seal a deal this week on this assignment.
RWE is the third largest German utilities to divest its distribution, regulation by making returns less attractive.
Gas prices and electricity low, combined with the tax on nuclear fuel, RWE led to anticipate a decline in profits for three years.
Chief Executive Juergen Grossmann has embarked on a process of selling eight billion euros of assets, but according to sources familiar with the matter, he also considered the possibility of merger with Iberdrola.
The consortium will take control of the network consists of Munich Re, Swiss Life, Talanx
and a pension fund of German doctors.
Sources familiar with the matter told Reuters that RWE would retain operational control of the network even though it sold a majority stake
The Bundestag, the lower house of German parliament voted in June for a release of Germany's nuclear power by 2022, as a result of the nuclear disaster at Fukushima in Japan.
The action RWE gained 0.11% to a quarter of an hour of closing.
The forecast was lowered to 0.2% for the second quarter, against 0.9% in the first three months of the year.
The growth of the French economy to slow to 0.2% in the second quarter, after starting the year at 0.9%, according to a third prediction of Banque de France (BDF) and published on Friday revised down by from its last estimate, which stood at 0.4%.
This prediction is consistent with the National Institute of Statistics (INSEE), which will publish its growth figures for the second quarter in August.
The net downward adjustment of French growth forecast due to the stronger than expected decline in its business climate indicator, which falls below its long-term in the industry, it passes 99 points (against 103 in May) and in the service he moved to 99 points (against 100).
For the full year, the government expects growth of 2%, after 1.4% in 2010.