Business News & Financial News

European stock markets closed sharply higher Friday, praising the employment figures significantly better than expected in the U.S. in January and other U.S. statistics considered encouraging for e global economy.

The CAC 40 index ended for the first time above 3,400 points since early August, with a gain of 1.52% to 3427.92 points. For the week, the benchmark index of the Paris took 3.29%.

The London Stock Exchange has sold for 1.81%, 1.67% that of Frankfurt and Milan up 1%. The pan-European STOXX index rose 1.49% 50a.

Concerns about the apparent lack of progress on the Greek case, however, have plunged the Athens Stock Exchange.

"After a month of January for significant investors, European stock markets continued their advance (…) the announcement of a fall in unemployment in the United States to its lowest level in three years (8.3%) and an imminent agreement on Greece maintain the euphoria on global indices, "said Fabrice Cousté, CEO of CMC Markets France. 

The upturn in the U.S. employment continued in January, with the highest rate of job creation observed in nine months, and the unemployment rate fell to , its lowest level in nearly three years, reflecting the impact of growth in the fourth quarter of 2011 at the beginning of new year.

The growth rate of services sector in the U.S. has in turn greatly accelerated in January, while economists had estimated that it would evolve in the ME I beat that in December, according to figures released by the Institute of Supply Management (ISM). 

In addition, orders to U.S. industry rose for the second consecutive month in December, driven by increased business investment, and the rate of growth of the sector services has increased significantly in January.

Deposits record debt have accelerated last year after a slight dip in 2010. The number of filings in 2011 with commissions of over-indebtedness on the mainland increased by 6.6% compared to 2010, 232,493, announced Wednesday the Bank of France. It increased by only 1% in the first nine months of 2010. The number of cases handled, it is more sensitive it up by 10.1% to 239.647.Dans detail, the commissions have used the new possibilities offered by the law Lagarde, effective the end of 2010, which allows them to not go before the judge for approval of a plan to erase debt. The number of recommendations to erase debt, also called personal recovery proceedings without liquidation (the judge orders the sale of household goods over-indebted if any) has been increased almost tenfold between 2010 and 2011 . As a result, the number of recommendations approved by the judges jumped 30% to 48,797 in 2011.Parallèlement, the number of cases referred to committee by the judges was down 22% in 3549.

The Government will meet throughout the weekend to decide on a new set of anti-deficit. The announcement will probably be Monday at the end of an extraordinary cabinet meeting. Minister of Economy and Finance, Baroin, and budget minister, Valérie Pécresse (here on the benches of the National Assembly on 6 September 2011)

The government will hold meetings arbitration throughout the weekend before the announcement, probably Monday, a new set of anti-deficit measures which a light could be a new day of solidarity, has said on Saturday a government source. "Conciliation meetings will be held the weekend before the ads are likely to take place Monday even if it is not yet confirmed," it was said the same source.Announcement of details of the measures occurring after a cabinet meeting postponed to Monday exceptionally due to preparation of the G-20 summit last Wednesday.

According to reports in the Journal du Dimanche, a government source confirmed a second day of solidarity is under consideration. Founded in 2004 after the 2003 heat wave, the first Solidarity Day is a day of unpaid work whose fruits fund the care of elderly and disabled. Originally set for Monday of Pentecost, that day, which reported 2.4 billion euros in 2010, has since 2008 organized "a la carte".

Other measures to be announced Monday include the raising of the reduced VAT rate, from 5.5% to 7% for the restoration and renovation of housing.

European banks need a hundred billion of fresh capital to strengthen their balance sheet and address the current turmoil, said Thursday the Austrian Minister of Finance, Maria Fekter.

The issue of recapitalization of banks is a major enrolled in the agenda of the EU summit scheduled for Sunday, expected to make a comprehensive response to the debt crisis.

"Thank God it's not as high as suggested by the media.What is needed for the recapitalization is about 100 billion (euros), "said Maria Fekter at a conference.

Banking sources and the European Union had earlier told Reuters it would take 90 to 100 billion euros to recapitalize banks in the EU.

This amount, which is the subject of an agreement on the part of Twenty-Seven, should cover about sixty of the largest banks in the EU, the sources said.

"The amount was discussed by member states, it is now acceptable for everyone," said a source told Reuters the EU.

"The amount could exceed 90 billion euros," said a banking source.

The envelope must be added to the 50 billion already raised by European banks over the period from January to April and the funds raised on the market for which the sum is not yet precisely known.

Sovereign debt valued in "MARK TO MARKET"

It takes into account a requirement of capital adequacy ratio "core tier one" of 9% and retains the same definition of this ratio as that used in the last series of stress tests in July, despite protests from some countries.

Germany will for example not allowed to consider in its bank holdings "silent" they hold in other institutions and, in the same way, Spain will not recognize additional reserves of capital that Bank of Spain requires national banks.

As expected, the amount also takes into account a value to market value of sovereign debt held by banks.

This exercise of "mark to market" will cover not only the securities issued by the peripheral countries of the euro area but also those known as the center, who sometimes treat the secondary market at above face value, as the case for German Bunds.

"There is no reason that we inflicted only the negative aspects of this exercise without taking into account the positive aspects," said one source, but said it would have a positive impact on the envelope eventually required for such recapitalization.

This amount must now be discussed by finance ministers and between heads of state and government of the euro area and EU, who meet from Friday to Sunday in Brussels.

The growth slowdown coupled with the dynamism of the labor force will not help to reduce the number of unemployed, estimated employment center in its economic outlook. Agency employment center in Nice

Employment center does not provide for improvement on the unemployment front table and at best a stabilization of the number of job seekers in 2011 and 2012 and, at worst, a deepening if growth turned out lower than forecast government. "The slowdown in job creation combined with the dynamism of the labor force should not be allowed to initiate a decline in unemployment," said employment center in its economic outlook published Tuesday, October 4.

For 2011, the Agency plans to increase the number of job seekers without any activity of 5000 and 78,000 by including persons who have reduced activity.These predictions are based on a growth assumption of 1.75%, made by the government. Next year, "unemployment started to decline," if growth remained at 1.7% (assuming the government), with a decline in the number of job seekers with no activity on the order of 5000 and 12,000 by integrating people with reduced activity.

However, "if growth slowed in 2012, unemployment would continue to grow," said employment center. Based on a growth assumption of 1.4% (the IMF), the number of job seekers with no activity would increase by about 27,000.The prospect of a "stabilization of unemployment seems reasonable, except major accident" by the end of the year, said at a press briefing Christian Charpy, general manager of employment center.

Job creation is not strong enough to absorb the increase of the labor force

But, "unemployment will not reach the level it had before the entry into recession in early 2008," noted Bernard Ernst, director of studies of employment center who recalled that in previous crises of 1974 and 1992 the Unemployment had found "quite quickly" its pre-crisis. These forecasts are more optimistic than those of UNEDIC (unemployment insurance) that, based on growth in 2012 of 1.2% (consensus of economists) has provided an increase of 36,700 unemployed with no activity this year and 55,500 next year. "At this stage, a forecast of 1.2% in 2012 seems overly pessimistic," said Mr.Charpy.

Employment center provides, in addition, 130,000 net new jobs this year by companies affiliated with unemployment insurance, but the momentum is down (44 000 in the second half, against 96,000 in the first). In 2012, job creation should remain the same (126 000) if growth remained at 1.7% but reach only 101,000, with growth slowing to 1.4%. These new jobs do not seem sufficient to reduce unemployment because they are less than the increase in the labor force estimated at 140,000 or 150,000 per year.

According to Bernard Ernst, the labor force could grow more than expected after the announcement by INSEE in mid-May to strong growth in first quarter (0.9%).The prospect of an upturn in the economy brought on the labor market of people (youth, women etc) that were not previously found that increased enrollment in the employment center lists the "first mover" and people signing up for a "return to work," he said. "Registration for employment center are not independent of the economy" said Mr. Charpy.

Greece, which bends under the weight of its debt, should go ahead with the reforms advocated by its international donors at risk of serious consequences, said the governor of the central bank of Greece, George Provopoulos.

"Either we proceed immediately to implement significant structural reforms and monitor the dynamics of the debt or we face a dramatic situation," said Greek central banker in an interview to the newspaper "Sunday Real News".

For the man who sits on the Board of Governors of the European Central Bank (ECB), the realization by the firm BlackRock Solutions for an audit of the loan portfolios of Greek banks should help them to regain access to market financing.

Safran's aerospace equipment will make its entry into the CAC 40 index, while the bank Natixis is about to leave, said Friday the Scientific Council of the indices of NYSE Euronext.

In a statement, the Council states that these changes will take effect from the trading hours of Monday, September 19.

The entrance to Saffron in the benchmark index of the Paris Stock Exchange was expected, but the output of the subsidiary of BPCE (People's Bank – Savings Bank), one year after its entry into the CAC, was least, the market until a further release of Suez Environnement.

The action Natixis lost 17.59% of its value since the beginning of the year and 41.4% since September 17, 2010, its entry in the CAC.

No comments could be obtained immediately from Natixis or Safran.

The Scientific Council of the indices of NYSE Euronext has also decided to introduce in the SBF 120, IT group Bull, the specialist in bioanalysis Eurofins Scientific and Virbac Animal Health Laboratory, and the output of specialist allergy treatment Stallergènes .

Companies in the manufacturing sector have seen a slight decrease their investment plans for this year and now expect an increase of 14%, shows the quarterly survey conducted in July and published by INSEE on Friday.

In the previous survey in April, the business leaders the industry planned to increase investment by 15% in 2011.

Last year, these investments have increased by 1%, says the National Institute of Statistics and Economic Studies, while the April survey estimated the stable.

For 2011, the downward revision of forecasts from one quarter to the other "is attributable to the sector" other industries "(-3 points), especially metal or wood working, and the sector electrical, electronic, computer and machinery (-2 points), "INSEE said.

"For the first half of 2011, entrepreneurs in the manufacturing sector confirm the progress of their investments over the second half of 2010, early in January. For the second half of 2011, they plan to increase their investments over the first. "

Investment in the industry represents about one quarter of productive investment in France.

UBS plans to eliminate 3,500 positions, including nearly half of its investment banking activities, as part of a plan to cut nearly half its annual costs by the end of 2013.

The bank said last month that it would undertake a restructuring plan when it published the results below expectations.

"The measures announced today will help improve operational efficiency. UBS will continue its vigilance vis-à-vis its costs, while continuing to invest in growth areas," said the Swiss hotel in a statement.

The Tokyo Stock Exchange ended sharply lower Friday, with a decline of 2.51%, instead accusing a Japanese third session down due to renewed fears of a return to recession have pushed Wall Street and stock markets Europe the day before.

The Nikkei lost 224.52 points to 8,719.24 and the Topix, broader, sold 15.62 points (-2.04%) to 751.69.

Financial analysts believe it is unlikely for there to be a real rebound in shares before Ben Bernanke, the chairman of the Federal Reserve, is expressed on Friday at a conference in Wyoming.

"The measures to be taken by the Japanese government are limited and the current market weakness is mainly due to concerns about overseas markets," said Takahide Kiuchi, chief economist at Nomura Securities.

"Investors will mainly focus on whether the Fed will suggest that it could take further monetary easing."

The decline occurred on Friday in a trade volume rather low, below the average of the past week.

Car manufacturers, a strong presence in the United States, fell sharply due to concerns about the sharp slowdown in the activity of the world's largest economy, losing 1.39% Toyota, Honda and Nissan 3.34% 4.39% .