More possible bad economic news for Italy!!!

UniCredit weighs partnership for bad loan business -sources

By Francesca Landini and Gianluca Semeraro

MILAN, July 4 | Thu Jul 4, 2013 12:11pm EDT

(Reuters) - Italy's biggest bank UniCredit may consider a partnership for its business that manages 42 billion euros ($54.24 billion) in bad loans following interest from international investors, banking sources said on Thursday.
"Blackstone is interested in the company," said a source familiar with the activity of the U.S. investment firm in Italy.
A banking source said other investors were looking at the business, which has the largest portfolio of assets under management in Italy.
"UniCredit is weighing the possibility to find a partner ... among other options," the second source said.
UniCredit could cut the amount of capital it is required to hold to back the bad loans in the business - called Credit Management Bank - if an investor took a share in it, one analyst said.
Regulators require banks to set aside certain amounts of capital to cover their bad loans.
One of the sources said it was unlikely a deal could be reached by the beginning of August, when quarterly results are due to be published.
UniCredit declined to comment, while Blackstone did not immediately respond to a request to comment.
As of 31 December 2012, Credit Management Bank had a total portfolio of loans worth 45.2 billion euros, according to a report by rating agency Fitch.

Stock Just Pennies Away From Breaking an Important Technical Barrier

By Serge Berger | StreetAuthority Network – 7 hours ago

 

RELATED QUOTES

Symbol	Price	Change
SEE	24.96	+0.31

Sealed Air Corporation (SEE), the New Jersey-based manufacturer of food packaging materials and equipment, continues to exhibit relative strength versus the broader market, despite the recent uptick in volatility. 

The stock had a massive but orderly rally off its summer 2012 lows on unabated strength, but then spent the better part of the past four months in a notable bullish consolidation phase. SEE now looks to be coiling up, and if it gets enough momentum to break past recent resistance, it might also break past a multi-year resistance line, thus making the current juncture important in multiple time frames.

On the weekly chart, we see that the stock plummeted from a high near $33.90 in May 2007 to a low below the $10 mark in early 2009. The ensuing reaction rally measured more than 175% over the course of just 24 months.
Gravity eventually dawned on the stock in February 2011, which led to another big drop. The February 2011 top, however, is important from a multi-year perspective. It serves as the second point on a downtrend line drawn from the 2007 top.
SEE finally completed this next leg down in August 2012, which notably served as a higher low versus the 2009 lows. What followed was another sharp, roughly 90% rally over the course of seven months that came to a halt in March of this year after the stock displayed a month-long vertical leap around mid-February.
In hindsight, the March highs also coincided with the 2007 downtrend line, currently around the $24.90 mark, which increases the importance of this line from a multi-year perspective.      

Moving on to the daily chart below, note that since reaching a high of $25.08 on March 15, the stock spent the past three and a half months consolidating the big move up from August 2012 to that high. After a quick 16% correction into mid-April, SEE had retraced almost 23.6%, a Fibonacci number.
From there, as fund managers began to chase the market higher, they also snapped up shares of SEE, and by early June, this brought the stock right back near the March highs. Since early June, the stock has made three attempts (June 4, June 18, and July 1) at breaking past the mid-March highs.

There are two things that make me think an eventual breakout is just around the corner:
1. In late June, the stock had a mini pullback, which quickly found good support at the 50% retracement line of the April to early June rally. This confirmed yet another higher low on the daily chart, which increases the odds of a higher high in the near future. A higher high would be accomplished on any daily close above the March highs, or around $25.10.

2. Over the past three trading days, the stock has consolidated right at the resistance line of recent months. Such a consolidation right below the highs, after multiple tries to overcome them, qualifies as churning below resistance and is a bullish sign.

 

Nifty Futures Signal Stocks May Rally From Worst Loss in 2 Weeks

By Rajhkumar K Shaaw - Jul 3, 2013 10:58 PM ET

 

Indian stock-index futures gained, signaling benchmark indexes may rally from the biggest decline in two weeks.
SGX CNX Nifty Index futures for July delivery rose 0.2 percent to 5,783 at 10:40 a.m. in Singapore. The underlying CNX Nifty (NIFTY) Index fell 1.5 percent to 5,770.90 yesterday, the largest loss since June 20. The S&P BSE Sensex lost 1.5 percent. The Bank of New York Mellon India ADR Index of U.S.-traded shares dropped 0.9 percent.
Asian stocks outside Japan rose after better-than-estimated U.S. jobs data added to signs of recovery in the world’s largest economy, boosting the earnings outlook for exporters. The U.S. accounted for 11 percent of India’s exports in the year ended March 2012, government data show. Indian stocks dropped yesterday amid concern the central bank will have less room to cut interest rates as oil prices climb to near a 14-month high and the rupee weakens.
“The global news flow is positive and that’s the reason why futures are up,” Arun Kejriwal, director at Kejriwal Research & Investment Services, said by phone from Mumbai today. “But we don’t see it sustaining today as the rupee is likely to be under pressure because of the government’s move on food security. The concern is that our deficits will widen and it shows the government has already started preparing for next year’s election.”

Weakening Currency

India’s cabinet enacted proposals yesterday to expand the provision of cheap food to the poor, approving a rarely used executive ordinance to pursue a central plank of the government’s re-election strategy with a national ballot due before the end of May.
The government may spend about 1.25 trillion rupees ($20.7 billion) on food payments in the financial year ending March 31, 2014. Subsidies have helped widen the nation’s fiscal deficit amid the weakest economic growth in a decade.
India’s current-account imbalance, the broadest gauge of trade, is the biggest risk to an economy that grew a decade-low 5 percent in the year ended March, according to the central bank. The International Monetary Fund estimates the gap at 4.9 percent of gross domestic product this year, compared with 3.3 percent in Indonesia and a surplus of 2.6 percent in China.
The rupee weakened to within 0.9 percent of its all-time low yesterday on concern overseas investors will pull more money from local assets, leaving the currency vulnerable to a record current-account deficit.

Foreign Flows

Foreign investors withdrew the most money from Indian (SENSEX) stocks in June in about two years on concern the nation’s public finances will worsen when the U.S. Federal Reserve starts tapering monetary stimulus.
Overseas funds sold a net $1.1 million of Indian stocks on July 2, according to data from the market regulator, paring this year’s net inflow to $13.5 billion, a record for the period.
The Sensex has retreated 5.5 percent since climbing to a two-year high on May 17 as the prospect of reduced monetary easing by the U.S. prompted global investors to pull money from emerging markets. The gauge is valued at 12.8 times projected 12-month earnings, compared with the MSCI Emerging Markets Index’s 9.5 times.
Shares of Larsen & Toubro Ltd. (LT), India’s biggest engineering company, may be active after Reuters reported the company got a contract for a $352 million road project in Oman.
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net
To contact the editor responsible for this story: Michael Patterson at mpatterson10@bloomberg.net

Italy to cut spending, sees risks of protests: report

Well it is not over or even close to being over with the economy. It is not just hitting one country this thing is global. Here is a report from Reuters about Italy:


 

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New Italian Economy Minister Fabrizio Saccomanni attends at the Lower house of the parliament in Rome, …

MILAN (Reuters) - Italy will resume public spending cuts to find resources for tax cuts to kick start growth, Economy Minister Fabrizio Saccomanni told daily Corriere della Sera on Saturday.
He warned, however, that cuts could spark social unrest in the euro zone's third largest economy, where lobbies have so far resisted previous government attempts to reduce state spending.
"We aim to support economic growth through a reduction of taxes on labor and companies," said Saccomanni, former deputy governor at the Bank of Italy.
"We can't do it by raising public debt, so we have to cut public spending," he said in an interview with the Italian daily.
Italy issues some 400 billion euros ($520 billion) of bonds each year to fund its 2-trillion-euro debt pile, Saccomanni said, reiterating that Rome could not put at risk its credibility on the markets by spurring growth with new debt.
Rome has committed to maintaining a budget deficit of 2.9 percent of gross domestic product in 2013, just under the European Union's 3 percent ceiling, and has just emerged from the EU so-called excessive deficit procedure.
Saccomanni, under pressure from the centre-right party in the coalition government to relax austerity in the country, said the government will launch a new round of spending reviews.
The process, aimed at finding savings from the state's huge balance sheet, would take time and could be painful.
"No one should expect we will find hidden expenses we can cut without raising protests," the minister said, adding he did not have a "magic wand".
Few positive signs in the economy, however, could help the government in its difficult task.
"We are confident we will see a recovery towards the end of the year," Saccomanni said, adding he expects the cost of servicing Italy's public debt could be lower than estimates, freeing resources for growth.
The right-left government headed by Prime Minister Enrico Letta is struggling to balance Italy's commitments to the EU with coalition promises to cut taxes.
At the insistence of Silvio Berlusconi's centre-right, a crucial part of the ruling coalition, the government has suspended a housing tax on primary residences and has also temporarily blocked an increase in sales tax due to take effect next Monday.
($1 = 0.7693 euros)
(Reporting by Francesca Landini; Editing by David Cowell)

GLOBAL MARKETS-Volatile quarter takes shares down, gold plunges!!

Fri Jun 28, 2013 5:19pm EDT

 

* As fears of stimulus pullback ease, world equity markets
gain
    * Gold to close worst quarter on records going back to 1968
    * Dollar/yen at three-week high, edges close to 100 yen


    By Rodrigo Campos
    NEW YORK, June 28 (Reuters) - World equity markets rose for
a fourth day on Friday, but a gauge of world stocks and other
assets still ended in the red for the month of June and for the
second quarter as fears that U.S. monetary stimulus could soon
be pared back drove volatility and weighed on sentiment.
    Spot gold prices recorded their biggest quarterly decline in
at least 45 years, even as prices on Friday marked the biggest
daily percentage gain in a year.
    The broad S&P 500 index fell for the day, but upbeat
economic data from Japan and efforts by China's central bank to
ease credit concerns gave other equity markets support. MSCI's
world equity index rose 0.15 percent Friday to
gain more than 1.3 percent for the week, though for the quarter
it was down 0.01 percent.
    Markets were volatile as the second quarter drew to a close,
and investors pondered the likely impact of an end to the era of
easy money from the Federal Reserve and other central banks that
has been driven rallies in various markets.
    "The market is continuing to adjust as we try to figure out
what's going on with respect to Fed policy, and we should
continue to see volatility as things get sorted out," said Rex
Macey, who helps oversee $20 billion in assets as chief
investment officer at Wilmington Trust in Atlanta.
    "We're cooling off a little bit after a few days of strong
action."
    At the close of trading on Friday on Wall Street, the Dow
Jones industrial average fell 114.89 points or 0.76
percent, to 14,909.6, the S&P 500 lost 6.92 points or
0.43 percent, to 1,606.28 and the Nasdaq Composite added
1.38 points or 0.04 percent, to 3,403.25.
    Unlike other markets, however, Wall Street's three major
indexes finished the quarter higher, with the Dow up 2.27
percent, the S&P 500 up 2.36 percent and the Nasdaq up 4.15
percent.

 
    Global stock, bond and commodity markets have been highly
volatile since Federal Reserve Chairman Ben Bernanke signaled
last week that the U.S. central bank would soon cut the pace of
its stimulative bond buying unless the economic recovery slows.
    Markets had taken heart on Thursday after two Fed officials
seemed to back away from Bernanke's comments, but two other
policymakers of the U.S. central bank who spoke on Friday -
Governor Jeremy Stein and Richmond Fed President Jeffrey Lacker
- showed a more aggressive tone on when the central bank's
unprecedented policy accommodation might be reduced.
 
    Talk of the Fed tapering its bond buying has hit Treasury
prices hard. The slump in prices started in May, gaining
momentum with Bernanke's words last week.
    With quarter-end adding to volatility, exposure to U.S.
Treasuries through the iShares Barclays 20-year-plus
exchange-traded fund fell 8.9 percent in the last three
months, its worst performance over the last 10 quarters.
    The recent choppiness could linger in markets in the coming
days, said Justin Lederer, strategist at Cantor Fitzgerald in
New York, especially going into the release next Friday of the
government's closely watched monthly U.S. payrolls report.
    "That could definitely set the tone for a date for QE" to
start winding down, he said.
    The benchmark U.S. 10-year Treasury note fell
4/32 in price to yield 2.4894 percent, compared with 2.476
percent late on Thursday.
    A Reuters survey of 53 investors across the United States,
Europe and Japan released on Friday found that funds had already
cut their average equity holdings in June to a nine-month low
due to the recent volatility and held more cash. 
    Gold, which had soared in value as a hedge against higher
inflation from the cheap central bank money being printed, has
slumped. Despite posting on Friday its largest daily percentage
gain in a year, spot gold prices fell about 23 percent
for the quarter, the largest quarterly percentage drop on
records going back to 1968.
    Gold was recently trading at $1,233 an ounce, its lowest
level since August 2010.

    WINDOW DRESSING
    End-of-quarter maneuvering was cited for volatility in the
euro on Friday. The euro zone common currency was off 0.2
percent to $1.3014.
    Against the yen, the dollar was up 0.8 percent at
99.16 yen.
    The broad FTSEurofirst 300 index closed down 0.45
percent to end June 5.3 percent lower after a record 12 monthly
rises.
    Earlier, MSCI's broadest index of Asia-Pacific shares
outside Japan climbed 1.4 percent, pulling
further away from an 11-month low and wiping out this week's
losses. It was still down around 7 percent for the year. 
    China's stock markets had also seen their biggest gains in
two months after the country's central bank, which had let
short-term borrowing costs spike to record highs, said it would
ensure its policy supported a slowing economy. 
 
    Brent crude oil futures fell 0.7 percent but were up
1.7 percent for the month, the first positive month in five.
    Copper edged up but its more than 10 percent decline
for the quarter was the worst performance in almost two years.

The interest rates are creeping up!!! Is this the start of inflation?

I cannot help but think that the feds are just printing more money. As they keep on with this same old tired pattern two things will happen. The first is that they will have forced the dollar into an unfavorable position globally. The second is that inflation will ensue. In case you didn't notice the interest rate just jumped almost two percent in one month. That is the highest jump like that in twenty plus years. Is this the start of the inflation that we all know is coming? It could be. Th real problem is if both of these circumstances hit us at the same time. Imagine the dollar losing more of its value coupled with the inflation rate at the same time. This could make the super economic storm known as hyper inflation. What that means is that things are so out of control that people would not be able to afford food. It would be like the stock market crash in the 1920's all over again. Only this time it would be closer to the 2020's. What are most peoples reaction? They are in denial. If you bring this up they will say that wont happen or some other excuse to make themselves feel better.  Always remember if you fail to plan you plan to fail. I hope for the sake of everyone that this is just going to be normal inflation. I can't help but be very suspicious though.

Wall Street drops on signs of weak economy, North Korea?!

By Caroline Valetkevitch

NEW YORK (Reuters) - Stocks fell on Wednesday, with the S&P 500 index posting its biggest daily decline in more than a month, after a weaker-than-expected survey of private employers raised concerns about the strength of the economy.
News the Pentagon was sending a missile defense system to Guam in the coming weeks and remarks by Defense Secretary Chuck Hagel that North Korea posed a "real and clear" danger added to investor caution.
The ADP National Employment report on private-sector jobs showed less-than-expected hiring in March, which was a worrying sign for investors before the Labor Department's March non-farm payrolls report on Friday.
Wednesday's market decline came a day after the benchmark S&P 500 and the Dow finished at record highs. Energy and financial sectors led the day's fall on the S&P 500, with the S&P 500 financial index (.SPSY) down 1.7 percent.
"People continue to push the thesis that the bull market will remain intact as long as housing continues to be strong, and there will be a little doubt put on that thesis if the jobs number Friday is underwhelming," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.
Worries about North Korea added "another risk element to the market," he said.
Defense company shares gained despite the broader move lower. Shares of Northrop Grumman (NOC.N) were up 1.1 percent at $70.18, while shares of General Dynamics (GD.N) were up 2.1 percent at $68.39.
The Dow Jones industrial average (.DJI) was down 111.66 points, or 0.76 percent, at 14,550.35. The Standard & Poor's 500 Index (.SPX) fell 16.56 points, or 1.05 percent, at 1,553.69, its biggest daily percentage decline since February 25. The Nasdaq Composite Index (.IXIC) was down 36.26 points, or 1.11 percent, at 3,218.60.
The S&P 500, up 8.9 percent since the start of the year, has come close to its intraday record level of 1,576.09 in the past few sessions before pulling back, causing analysts to question if the recent rally is sustainable.
The Dow Jones Transportation Average (.DJT), seen as a barometer of economic activity, fell 1.3 percent to 6005.95, closing below its 50-day moving average for the first time since November 21.
On Tuesday, decliners beat advancers in the market despite gains in the three major indexes. Also, healthcare, consumer staples and utilities, seen as the S&P's most defensive sectors, have led this year's rise on the index.
Energy shares were among Wednesday's biggest decliners, with U.S. crude oil prices falling 2.8 percent. Shares of Chevron (CVX.N) were down 1 percent at $117.78.
Other declining stocks included ConAgra Foods Inc (CAG.N), which fell 1.9 percent to $34.85 after reporting third-quarter earnings that fell 57 percent, though revenue grew.
Monsanto Co (MON.N) rose 0.9 percent to $104.51 after raising its full-year profit forecast.
First-quarter earnings forecasts have been lowered since the start of the year, with S&P 500 company earnings now expected to have risen 1.6 percent in the quarter compared with a year ago, according to Thomson Reuters data. A January 1 forecast put earnings growth at 4.3 percent.
Shares of Zynga Inc (ZNGA.O) surged 15 percent to $3.53 after the company said it would begin offering poker and casino-style games in Britain in partnership with Bwin.party Digital Entertainment (BPTY.L).
The ADP report showed U.S. companies hired at the slowest pace in five months, far below what economists had expected, though the February report was revised upward.
The more widely watched U.S. government jobs report, due Friday, is expected to show 200,000 jobs were created last month.
In another report, the Institute for Supply Management's March services sector index also came in below expectations, with the pace of growth at the lowest level in seven months.
Volume was roughly 7.1 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, compared with the 2012 average daily closing volume of about 6.45 billion.

Decliners outpaced advancers on the NYSE by about 4 to 1 and on the Nasdaq by nearly 3 to 1.

(Editing by Nick Zieminski and Kenneth Barry)