Archive | October, 2014

Bank of Japan expanded annual purchases of bonds

Bank of Japan surprised investors with fresh monetary stimulus aimed at helping the economy, which continues to battle with rising sales tax in April. The news caused a significant movement in foreign exchange and capital markets, increasing again reverse correlation between the movement of the yen and that of Japanese shares. The central bank said it will expand its annual purchases of bonds to 80 trillion JPY (726 billion USD) per year. Before it was buying assets amounting to 60-70 trillion JPY. The institution will also increase its purchases of government debt by 30 trillion JPY and triple its stake in local exchange-traded funds and investment trusts in the field of real estate.

In its statement Bank of Japan present peaceful stance on monetary policy, saying it would continue measures for facilitating “in an open way”. However, the decision was not unanimous at all. Five members of the Council supported Bank of Japan new incentives, while the remaining four were against. The news came shortly after data showed that consumer inflation slowed further in September, raising skepticism about the ability of the central bank to achieve the desired expansion of the target level of 2%. In September core consumer prices rose by 1% annually, slowing acceleration from a rise of 1.1% in August.

Analysts note that the Central Bank should do more to prepare the economy for the second increase in the sales tax to 10 percent planned for next year. Levy on sales had increased to 8% from 5 percent in April, provoking a contraction of 7.1% targets on an annual basis in the second quarter.

In its recently published half-yearly Economic Outlook of the Bank of Japan lowered expectations for the expansion of gross domestic product by 0.5% for the financial year ending March 2015, compared to the previous forecast of 1%. The forecasts for the main indices of consumer prices, excluding the effects of the expansion of the sales tax was also reduced to 1.2% for the financial year 2014/2015 compared to the earlier target of 1.3 percent. For 2015/2016, the forecast does already for a level of 1.7% vs 1.9%.

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Shell quarterly profit expanded with 24%

Quarterly report of the Royal Dutch Shell has exceeded expectations, the main profit of the company increased by 24% and reached 5.8 billion USD, which allowed him to keep the size of the dividend. The largest oil company by market value in Europe also announced that it has appointed the former president of Bank of America, as the new head. Charles Holiday will take over from current chairman and former chief of the Finnish mobile giant Nokia Jorma Ollila in 2015. The Anglo-Dutch oil producer has achieved rapid recovery compared to last year through the sale of assets and the expansion of production in the Gulf of Mexico and West Africa.

Although the optimistic tone, the financial result fell against the second quarter mainly due to lower oil prices and limited production. The oil and gas production has given way to the annual rate of 5% compared to the same period last year to 2.79 million barrels of oil equivalent per day, largely due to the sale of assets.

“Recent declines in oil prices are part of the instability in our industry. They stress that it is important to get a tighter grip between management, common control costs and improve the balance between growth and profitability”, said the CEO of Shell.

Oil companies have been significantly affected due to falling prices of “black gold” in the last four months by 25% as a result of the slowdown in global demand, particularly in China, and the abundance of supplies. Shell has taken a significant move for separation of assets this year, gaining more than 15 billion USD. The company said that only in the third quarter raised funds reached 3.6 billion USD.

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Deutsche Bank reported net loss of 94 million EUR in Q3 2014

The German biggest bank Deutsche Bank reported net loss of 94 million EUR on revenue of 7.9 billion EUR in the third quarter on revenue of 7.75 billion EUR an year earlier. The results of the bank behind serious than analysts’ forecasts, which indicated a net profit of 92 million EUR. The discrepancy is partly allocated during the quarter for legal costs 894 million EUR to German biggest bank said last week. Together with seven other financial institutions Deutsche Bank is under investigation for its participation in the manipulation of interbank interest rate Libor, as well as forgery of currency exchange rates. In the operating business in the third quarter the bank took advantage Fri strong dollar in foreign exchange transactions. Strong currency fluctuations are also reflected positively on business. Profit before tax increased from 18 to 266 million EUR.

In investment banking revenue increased 9% to 3.1 billion EUR. Almost half of them are from the vast division of the bank bonds, contributing 1.4 billion EUR to the result. This is an increase of 15% and is much better presentation of the relevant divisions of the American competitors such as Citigroup or JP Morgan. The profit before tax in Corporate Banking & Securities (CB&S) increased by 4% to 374 million EUR. In the private clients division result is loaded because of low interest rates. Profit before tax increased by 3% to 356 million EUR.

Earlier this month people familiar with the matter said that the US and other regulators are expected to impose severe fines on Deutsche Bank in the next few months. On Tusday the bank announced a reshuffle of leadership as Chief Financial Officer Stefan Krause will be replaced by a manager of Goldman Sachs. Krause will not leave the bank, but will take a newly created position in it. Although judicial problems Deutsche Bank, along with another 24 of the largest banks from Germany, has successfully passed the stress tests of the European Central Bank (ECB), the results of which showed that it has sufficient capital to be able to cope with the new financial crisis.

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Business confidence in Italy increased

The business confidence in Italy increased surprisingly in October. Barometer of the business climate rose by half a percentage point to 96.0 points, said the national statistics bureau Istat Tuesday in Rome. The experts had expected a decline to 94.9 points. The improvement according to Istat is visible in all sectors - industry through construction and retail trade and services. The result is considered a bright spot for the third largest economy in the Eurozone, which is still looking for ways out of the economic crisis.

The Prime Minister Matteo Renzi intends to revive the economy with reform of the labor market, but faces resistance. Hundreds of thousands of Italians took over the weekend to protest against the planned reforms. Trade unions and the left wing of the Democratic Party of Renzi oppose easing of protection against cuts and fear that it will be violated employee rights. Prime Minister argued that this protection will discourage companies that hire new employees. Renzi, who was elected prime minister in February after the censure of the Government of Enrico Letta in parliament, announced an ambitious program of political and economic reforms, including changes to the electoral law and the reform of the labor market by relaxing the law.

However, so far the government has made modest progress in the adoption of the necessary legislation, while, none of his reforms is not complete.

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China will invest 105 billion GBP in UK infrastructure

China will invest 105 billion GBP in UK infrastructure by 2025, according to a survey. Most funds will go to the energy, real estate and transport sectors. The second largest economy in the world has already invested 11.7 billion GBP in the UK between 2005 and 2013, one example of which is 10% share of sovereign wealth fund China Investment Corporation in the largest water company in Britain - Thames Water. The expected investment in the UK quickly swell as the Chinese capital seeking safe havens for overseas investments.

According to official statements the UK will be ranked third in attractiveness for Chinese investment, after the US and Japan, by general 144 countries. The flow of investment from China to the UK has increased rapidly in the first half of 2014, a total of 2 billion GBP has been invested in infrastructure, including property, establishes report. Examples are prominent investment for 790 million USD of Sanpower in House of Fraser in April and invested 187 million USD in real estate by China Construction Bank in Old Broad Street in the City of London. It is expected that China General Nuclear Power Corp to acquire a minority stake in the project for EDF nuclear power in Hinckley Point, although a final agreement has not yet been reached.

Despite the strenuous efforts of the British government to encourage Chinese investment in new infrastructure, however, the majority of investments in property or operating assets that provide a secure return. The main reason for this was the lack so far of many projects that are formally laid out and ready for immediate commencement of construction activities, as the British government suspend or terminate major infrastructure projects during the financial crisis.

Major competitors in China are Canadian and Asian pension funds and sovereign wealth funds of the Middle East, which also waiting to pour large amounts of money in infrastructure in the UK. Chinese investors stand out among its competitors because of their appetite for risk in construction. He cited as examples invested billions of yuan in Africa and Eastern Europe, where Chinese investors sell the equipment as part of the transaction and simultaneously create its engineering and construction features opportunities.

Despite their desire to spread their big opportunities in the engineering and construction field and in the UK, Chinese investors face their own challenges into account the report. One is that the Chinese wind turbine technology fails to provide financial support in the UK because it is not sufficiently tested. There are also concerns that a possible Chinese engineering qualifications are not recognized in the UK.

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Petrom and ExxonMobil began new gas research in Black Sea

The Romanian company Petrom and the US ExxonMobil begin a new study in the perimeter Neptune in the Black Sea, when in 2012 during the first operation in the deep zone of the Black Sea have discovered natural gas reserves of about 42 to 48 cubic meters. The new probe will be located about 155 km from the coast and explore new geological structure perimeter “Neptune”.

“The area of the Black Sea has a central role in our strategy and providing substantial technical and financial resources for offshore projects. We are encouraged by the good results achieved so far in waters with low and deep”, said Gabriel Seliski, Board of Directors Petrom, responsible for exploration and production activities

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Gold broke its last week growth

Gold broke its last week growth

Gold priceGold closed last week with a fall, thus terminating two consecutive weeks on the rise. The reason for the retreat became another strong economic data limited demand for the metal as a hedge against risk. Gold with delivery in December fell by 0.8% during the week, closing Friday’s session on Wall Street 1,231.20 USD per ounce. The contracts reached a weekly high of 1,255.60 USD per ounce on Tuesday, and the lowest point of 1,226.40 USD per ounce on Thursday came a day after better than expected US data calmed markets for the economy as a whole. The precious metals started the week steady, adding 0.70% respectively, and 0.56% on Monday and Tuesday. However, Wednesday and Thursday brought a decline of 0.50% and 1.24%. On Friday, the gold partially correct earlier losses, closing with a slight increase of 0.17%.

The weekly labor data showed that new applications for unemployment benefits in the US have remained below 300,000 for the sixth consecutive week. The news was seen as a signal that the labor market ignores the panic about the renewed crisis in the global economy. The strength of the USD also contributed to the decline in the price of gold. The USD index ICE - measure tracking the strength of the greenback against a basket of six major currencies, rose to 84.95 points from 85.78 points on Monday. US currency and gold inversely correlated.

Looking ahead, the next major focus to gold investors is aimed at the upcoming meeting of the US Federal Reserve this week. The market consensus is that the central bank will decide to end its purchases of assets and is likely to give a signal when a gradual rise in interest rates.

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New strike in German division of Amazon

The E-commerce company Amazon seems once again have to bear the impact of workers’ strikes and cook for her in Germany. The trade union Verdi calls the company’s employees protest, they have already started on Sunday night shifts in the units of the US company in Bad Hersfeld and Leipzig. On Monday, the strike expands into divisions in Graben (Augsburg), Werne (North Rhine-Westphalia) and Rheinberg in the Ruhr area. In Werne will strike until Tuesday night, and the other places - until Wednesday. Thus for the first time simultaneously strike five divisions, said of Verdi. In late September, the trade union has organized similar protests in five divisions of the company in the country, but they did not go together.

Amazon in the strike continued intermittently since Easter 2013 union urges management to sign an agreement of the charge, as in Germany operate in the retail and business items. But Amazon positioned the company as a company in the “Logistics”, where average salaries are traditionally lower. So far the US corporation refused any negotiations with employees. The Amazon strike instance no negative impact on customers and customer site supply. In Germany, the company has over 9,000 employees in nine cities across the country.

Last week, the US e-commerce giant reported its biggest quarterly loss in 14 years. The jump in the cost of developing new products, licenses for music and video, as well as other parts of the strategy for expansion of the Seattle company, led to a net loss of EUR 437 million. Dollars in the third fiscal quarter. The amount is significantly greater than the loss in 2013 of 41 million USD. Most loss comes despite the 20% increase in revenue to 20.58 billion USD. Due to the financial results the company’s shares plunged in Friday’s trading session.

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Switzerland is best country for immigration

Switzerland is best country for immigration

SwitzerlandBesides boasting a superb fondue, beautiful scenery and first-class ski slopes, Switzerland is the best destination for immigrants. The survey of British bank HSBC Expat Explorer for 2014 took part 9 thousand immigrants worldwide, describing the quality of life, financial well-being and the ability to start a family in their new homeland.

Second after Switzerland ranks Singapore, which is the richest financial center of Southeast Asia. The main advantages of the city-state as security, quality housing and diverse cuisine.

Despite the poor air quality, China ranks in the top three. The main reason is that the migrants in China receive more disposable income than most other places in the world. In the the country live the greatest number of high-immigrants. Almost 25% of immigrants there earning over 300 thousand USD annually against the world average of 5%. The dynamic economic environment is another factor for the happiness of Chinese immigrants. The economy in the country may be slowing, but its growth rate of over 7% it surpasses its competitors.

Germany, which has a reputation for safe and stable destination for foreigners in fourth place.

The modern and cosmopolitan archipelago in the Arabian Gulf - Bahrain, remains fifth. The country is an attractive destination for migrants in the Middle East mostly good balance between professional and personal life.

Sixth place in the ranking takes New Zealand, the country is defined as the best place to raise a family. The majority of immigrants there indicate good health, well-being and security of their children, noting that the country creates a more confident and better developed personalities.

Thailand occupying seventh position attracts immigrants affluent lifestyle at much lower prices than in their home countries, in their words.

Other countries completing the top 10 are also in Asia. These are Taiwan, India and Hong Kong, respectively, 8th, 9th and 10th place.

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Spanish unemployment fell to 23.7%

The unemployment in Spain declined in the third quarter. The percentage of unemployed Spaniards reduced to 23.67% between July and September compared to 24.47% in the previous quarter. For the first 10 months since the index down below 24%. The analysts expected results in the range of 24.10% in the third quarter. The number of unemployed decreased by 195.2 thousand people during the quarter and 515.7 thousand people during this year to 5.4 million people. Meanwhile, the number of employees between July and September increased by 58.5 thousand people on quarterly base and 274 thousand people on annual base to 17.5 million people.

In the third quarter were up 151 thousand new jobs to the detection in the second quarter 402.4 thousand jobs. Earlier this month a separate study showed that the unemployment rate rose for the second consecutive month in September. The number of unemployed in the fourth largest economy in the Eurozone increased by 19.7 thousand unemployed in September on a monthly basis, having increased by 8 thousand people compared to the previous month.

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