City of London SP Downgrades 16 banks
European Stocks Fall as Spain Contracts
European stocks fell, snapping a four-day rally for the benchmark Stoxx Europe 600 Index, as Spain entered a recession and U.S. business activity expanded at the slowest pace since November 2009.
Anheuser-Busch InBev NV (ABI) paced declining shares after the world’s largest brewer reported revenue that fell short of analyst estimates. Vestas Wind Systems A/S (VWS) dropped 4 percent as Credit Suisse Group AG recommended investors sell the shares. Adidas AG (ADS) rallied 4.9 percent after the sporting-goods maker raised its 2012 earnings forecast.
The Stoxx 600 fell 0.5 percent to 257.88 at 3:30 p.m. in London. The gauge has retreated 2.1 percent in April, a second straight month of losses, amid worse-than-forecast economic data and political uncertainty in France and the Netherlands.
“There is a two-way pull in the market at the moment,” said Kevin Lilley, a European fund manager at Old Mutual Asset Managers U.K. in London which has 4 billion pounds ($6.5 billion) in assets under management. “On the one hand, company results coming through are generally better than expected on both sides of the Atlantic, and on the other hand, economic data has been mixed.”
Spain’s economy officially entered its second recession since 2009 as gross domestic product contracted 0.3 percent in the first quarter, less than previous forecast. That compared with the Bank of Spain’s estimate on April 23 of a 0.4 percent decline. From a year ago, GDP fell 0.4 percent, INE said…
Spanish Recession Bites
China Makes 8 Billion Dollar Move on Anglo-Zionist Controlled, Oil Rich South Sudan
Guns and the silly English flag and homosexual MI6/Mossad are no match for butter. Good move China. Make business, not civil war.
Italian/Spanish Banks Grab More Sovereigns- EU Credit Markets
Ironic. The banks are in trouble because of Usury and the abuse thereof, and in turn are bailed out by the German Taxpayers, with their implicit liability for the ECB balance sheet. So the bankers are given good money for bad and in turn buy more government debt and get a super windfall off the back of the taxpayers through the interest payment collection. And if the taxpayers default their country implodes and the banks get every ones homes etc and they have a call option on taxing the people. Lots of rich Bankers in Europe and lots of unemployed. Sarkozy’s gambit is sheer evil and brilliant in making the banks the government through the amount of government debt they own.
(Reuters) – Banks in Italy and Spain stuffed their coffers with government bonds last month, European Central Bank data showed on Monday, in the latest sign they have been using ultra-cheap three-year ECB funds to stock up on sovereign debt.
Italian banks now hold more government debt than lenders in any other country in the euro zone, and Monday’s data may add to concerns that banks there and in Spain are becoming ever more wedded to the fate of their own heavily indebted governments.
The data, the first for the period following the ECB’s huge injection of three-year cash on February 29, showed Italian banks increased their holdings of securities issued by euro zone governments by a record 23.7 billion euros, taking their total holdings to 323.9 billion euros.
Spanish banks boosted their holdings of securities issued by euro zone governments by a hefty 20.1 billion euros. While the rise was smaller than January’s record 23 billion, it left total sovereign holdings at a record 263.3 billion euros.
“This confirms that most of the buying that pushed down yields in these two countries was done by the domestic financial sector,” Unicredit economist Marco Valli said….
Nationalist Party On the Rise In Greece
Note they try and equate nationalism and putting your own country and people and religious beliefs first, what is known as patriotism with nationalism. With the kind of Unemployment the USA has we should have a whole-sale round up and ship all the H1-B and illegals back home, yet illegals at millions per year come here as they get a massive stipend, free housing and often a job. The USA is not Mexico, and is not Africa, and with the USA spending a staggering 3 trillion a decade on supporting illegal immigrants we simply can’t afford it. Why should Greek fisherman lose their livihood to Egyptian fisherman?
Anti- Austerity Calls Grow in Europe
A recession in Spain and forecasts of rising unemployment in the 17-nation euro area are amplifying criticism of the German-led austerity agenda in election campaigns this week in France and Greece.
With Spain’s largest unions leading marches involving thousands of protesters in 55 cities yesterday, Prime Minister Mariano Rajoy’s government battled to prevent Spain from becoming the next country to seek a bailout. In France, where the presidential-election runoff is set for May 6, Socialist frontrunner Francois Hollande pushed back against German Chancellor Angela Merkel’s focus on deficit reduction.
“Watching Spain now is exactly like watching Ireland around October 2010 before Ireland was forced into its bailout,” Megan Greene, a senior economist at Roubini Global Economics LLC, told Bloomberg Television’s “Street Smart” on April 27. “The government can’t win no matter what it does.”
Spain’s economy shrank in the first quarter as the nation officially entered its second recession since 2009. Gross domestic product contracted 0.3 percent. Joblessness in the euro area probably to rose to 10.9 percent last month, the highest since 1997, according to economists surveyed by Bloomberg.
As Spanish joblessness reached almost one in four of the working-age population, Hollande demanded that euro-area leaders move to promoting growth from cutting budgets, as agreed by 25 European governments in the so-called fiscal pact. Merkel drew the line at re-opening talks on the fiscal treaty, though she said growth could be boosted with labor-market reform and European Union funding.
“There will be no new negotiations on the fiscal pact,” Merkel told the Leipziger Volkszeitung in an interview published on April 28. Even so, EU leaders may consider measures such as strengthening the European Investment Bank as part of a package of growth initiatives to be discussed at their summit meeting in June, she said.
Spain’s 10-year yield slid 5.5 basis points to 5.826 at 3:16 p.m. in Madrid, down from as high as 6 percent April 27. The Stoxx Europe 600 Index fell 0.2 percent to 258.54, while the euro declined 0.3 percent to $1.322 in Frankfurt.
The debate on growth was spurred on by European Central Bank President Mario Draghi last week after he called for a “growth compact” consisting of structural changes and improvements in competitiveness to enhance the fiscal pact….
EU- Record High Gasoline Prices Robs Europeans ex the English, Spanish and Dutch Crowns
The average retail price in the European Union’s 27 member nations surged to a peak of 1.69 euros a liter ($8.44 a gallon) on April 20 with Germany, France, the U.K., Greece, Italy and Spain all at records, according to European Commission data. The cost of gasoline at the pump in the continent, more than double U.S. levels, had made a fresh high every week since Jan. 13. U.K. gasoline advanced to a new all-time high last week…
ECB Inflation Cools A Fraction – For Now
(Reuters) – - Price pressures stayed high in the euro zone in April in the face of a likely recession, keeping interest rate cuts off the agenda for a European Central Bank seeking ways of reviving economic growth within its inflation mandate.
Annual consumer price inflation in the 17 nations sharing the euro moderated to 2.6 percent from 2.7 percent in March, the EU’s statistics office Eurostat said on Monday. Economists polled by Reuters had forecast 2.5 percent.
As the euro zone heads into its second recession in just three years, some of its leaders are rallying to a call by ECB President Mario Draghi to reignite the bloc’s economy with policies that focus on growth and not just debt and deficit reduction.
But the ECB’s strong focus on containing inflation within touching distance of a target of close to but below 2 percent at a time of high world oil prices means politicians cannot expect action to lower the cost of borrowing any time soon.
“The likelihood of inflation falling below 2 percent in the short run remains low, putting the ECB in a difficult situation,” Peter Vanden Houte, an economist at ING, said in a note.
“As the German members of the ECB’s governing council have been warning of inflationary pressures potentially building up, a further rate cut seems out of the question.”
While inflation is below last year’s peak of 3 percent, economists and the ECB had expected prices to fall steadily as the economy stumbles and to offer some relief to households at a time of rising unemployment and sharp spending cuts.
The rate of consumer price inflation rose in March from February and is now only back at February’s level, according to Eurostat, driven up by persistent worries of a crude oil supply disruption in the Middle East.
The ECB meets on Thursday and economists overwhelmingly predict unchanged rates, according to a Reuters poll that also points to a freeze in base borrowing costs until 2014.
“We don’t expect any radical changes in the monetary stance of the ECB. They will leave interest rates unchanged in this meeting in May,” said Clemente De Lucia, an economist at BNP Paribas in Paris.
However, the ECB is expected to try to force borrowing costs down for the bloc’s peripheral nations by restarting its government bond-buying program within three months, the poll also found.
Separate data on Monday showed lending to euro zone firms and consumers grew more slowly in March than the amount of money in circulation, suggesting the impact on loan activity of ECB actions to revive the banking system remains limited.
NO QUICK RECOVERY
Draghi said last week in Brussels that inflation was likely to remain above 2 percent for the remainder of 2012 because of high energy prices and tax increases in the euro zone as governments seek more revenues to deal with the debt crisis.
Signaling a renewed focus on fighting inflation, Draghi said the bank “will pay particular attention to any signs of pass-through from higher energy prices to wages, profits and general price-setting”.
Draghi told the European Parliament it was “essential” to keep inflation at below, but close to, 2 percent in the medium term, the bank’s long-maintained goal.
The euro zone’s economy is expected to contract by about 0.3 percent this year and the impact of the debt crisis is being felt everywhere, though economic and employment growth remain relatively resilient in the region’s biggest economy Germany.
Draghi warned last week that the onus was on the EU’s leaders to pull the bloc out of its crisis following the bank’s 1 trillion euro stimulus of cheap, three-year loans.
But the ECB’s rate policies could still come under scrutiny unless the economy starts to improve.
Economic data at the start of the year suggested a mild, brief recession in the euro zone, but optimism for a quick recovery is fading and investors are again worried about the solvency of Spanish banks and Italy’s ability to reform.
The European Commission’s latest business and consumer confidence survey last week found that morale was falling back to last year’s lows, while high oil prices are putting pressure on companies’ profit margins and complicating their ability to hire new staff and invest.
“Stubborn inflation will only add to households’ financial problems in the nearer term and supports the view that the euro-zone will fall deeper into recession,” said Ben May, an economist at Capital Economics in London.
Dirty Mervyn- QE Forever Baby As England Sinks Into Depression
(and housing, finance and the opium business is booming)
China-The land of Baksheesh