Business & Financial News

Doped including the sales and purchases of clothing, household consumption increased by 1.2% in June after declining during the previous two months. But the trend throughout the second quarter is negative. The World Food Planet Carrefour de Lyon

Finally a somewhat favorable economic indicator. While unemployment has increased again and the accumulated bad news on the front of the activity, household consumption expenditure increased 1.2% in June, after falling 0.3% in in May, according to INSEE. Increased yet insufficient to reverse the trend throughout the second quarter they were down 1.8% after 0.1% in the first quarter. What will weigh on growth mechanically.

This recovery is mainly due to the expenditure on durable goods, which rose 2.5% in June after falling 0.1% in May.Throughout the second quarter, but they recede by 6.3% from 2.2% in the first quarter.

Purchases of automobiles including increased 2.2%, but this increase does not offset the declines in previous months. In total, they were down 11.2% in the second quarter. Purchases of equipment housing are also up in June (3.8%, but 0.6% in the second quarter), thanks to a favorable schedule balances in furniture.

The strongest recovery has benefited from purchases of textiles and leather, which rose 4.3% after declining in May (-3.5%). This increase is partly due to the timing of sales that began early this year. In the second quarter, this item was down 0.3%, after -0.9%.

Consumer spending in other manufactured goods are up slightly in June (0.7%, after -1.2% in May).They decrease slightly in the second quarter (-0.2% after +0.6% in the first).

Energy consumption, it has continued to rise last month from 1.4% after 5% the previous month. Throughout the second quarter, however, declined by 1.1% due to particularly mild weather in April.

In the end, only the consumption of food has fallen (-0.4% after -1.4% in May). It is generally slightly lower throughout the second quarter (-0.1% after +0.2% in the first quarter).

Note that the number of consumer goods in May was revised by the INSEE, which is now estimated at -0.3% against -0.8% previously.

Lafarge reported Thursday a decline greater than expected operating profit, due to rising costs and currency effects, and warned that it should have an impact on earnings growth this year.

The world's cement, the world in concrete and announced this month the sale of much of its business casts for almost one billion euros, has confirmed its debt reduction target of at least 2 billion euros in 2011.

The Group's net debt stood at 14.26 billion euros at the end of the first half against 15.16 billion a year earlier (-6%).

In the second quarter, operating income stood at 702 million euros, down 16% from the previous year. Operating margin declined by 290 basis points to 15.9% against 18.8% a year earlier.

The group confirmed its expectation of an increase of 10% of energy costs throughout the year and 6% in overall costs.

Revenues remained stable at 4.416 billion euros.Group structure and constant exchange rates, sales grew in all activities with strong volume growth in emerging markets.

Analysts polled by Reuters had expected on average to a stable turnover to 4.415 billion euros and a 7.5% decline in trading profit to 773.6 million euros.

Net income group share was down 12% in the second quarter to 289 million euros, net earnings per share were 1.01 euros against 1.15 euros a year earlier.

A conference for analysts is scheduled for 9:00.

The stock closed Wednesday down 1.15% to 39.69 euros, giving a market capitalization of 11.4 billion euros.It was down about 14% since the beginning of the year while the DJ Stoxx sector yields nearly 7%.

TF1 reported Tuesday a sharp improvement in profitability in the first half thanks to cost savings and a return to growth in advertising revenue for its flagship channel in the second quarter, which boosted the price of its action.

In a statement released Tuesday, the television group maintains its forecast, however, considered conservative by analysts, stability of its consolidated sales throughout 2011, suggesting a continued lack of visibility on the evolution of conditions.

In early trading, the action blazes 4.9% to 13.35 euros while the index of pan-European media yields 0.4% at the same time.Since the beginning of the year, the title grew by 3.2% while its main rival M6, which will publish its half-year after the close of trading, 12.6% abandoned.

"The second quarter results were better than expected thanks to higher performance expectations of the TF1 channel," said one market participant, citing in particular the surprise increase in advertising revenue in the first string after a bumpy start to the year.

The advertising revenue of the chain's flagship group has returned to growth in the second quarter with sales up 0.7% after declining 2.6% in the first three months of the year sealed by poor hearing.

The market, which questioned the ability of TF1 to rise the prices of its advertising space in the second quarter in the absence of significant remontrée hearings, expected a decline of about 1%.

Of all the first six months of the year, advertising revenue declined, however, emerged from 0.9% to 764.6 million euros.

OPERATING INCOME surged 79%

The 43%-owned subsidiary of Bouygues also shows a jump of nearly 79% of its operating profit in the first half to 186.5 million euros against 136.5 million on average, expected by the market.

This sharp increase is due to new significant savings on the cost of grid TF1 which stood at 423.6 million, against 482.6 million during the same period last year.

The difference is mainly due to favorable basis of comparison, the channel that broadcast in June 2010 World Cup soccer.The net savings in terms of broadcasting rights, amounts to 49.3 million euros, TF1 said in a statement.

In contrast, sales of other activities of the group remained stable, rising advertising revenues and TMC NT1, the DTT channels redeemed last year was offset by the absence of income related to resale of sports rights.

Overall, the consolidated turnover of the group amounted to 1.3 billion euros, down 0.5% from the first half of 2010.

Net income Group share for its 118.6 million euros in the first half, against 74.2

A conference call for analysts is scheduled for 9:30.Group CEO, Nonce Paolini, could announce on this occasion it will request the free passage of its continuous news channel LCI.

Wall Street opened Monday's session down as investors worried about the stalled negotiations on the U.S. budget, a few days of the date by which Washington could face a default situation.

The elected Democrats and Republicans in Congress have failed to agree on a compromise and decided to work separately on separate projects.

A few minutes after the start of trading, the Dow Jones yielded 0.84% ​​to 12,574.56 points, the Standard & Poor's 500 index 0.84% ​​to 1333.72 points and the Nasdaq Composite 0.87% to 2834.04 points.

On the values ​​front, the title Kimberly-Clark fell by 0.4%.The manufacturer of tissue paper announced that its earnings per share for the year could end up in the bottom of the expected range.

Research In Motion lost 1.66% after its comprehensive cost optimization program, which includes 2,000 job cuts.

The values ​​of the European banking and insurance were up Friday, the markets welcoming the new aid package for Greece and the decision of the private sector to contribute to the rescue by agreeing to take a loss on their Greek bonds.

The agreement, torn by forceps after ten hours of the summit in Brussels after several days of intensive bilateral consultations, the reform also means dramatically Stability Fund (EFSF) into an embryo "IMF European ".

After recording the eve of its biggest increase since a session in January, with a gain of 4%, the index of European banking sector posted an increase of 1.52% by 0900 GMT.

The index of insurers simultaneously advancing 1.42%.

Private creditors are offered four options for their participation in the rescue, which include an exchange of title, an agreement on debt capital (rollover) or a share buyback program, for a contribution which could amount up 'to 37 billion euros.

Financial groups are likely to depreciate the value of Greek bonds they hold, maybe 21%, said Thorsten Wenzel, an analyst at DZ Bank.

In exchange, these are the values ​​that have been hardest hit by fears of a spreading crisis that show the best performance.Dexia shares jumped by 4.57%, Italian Intesa Sanpaolo took almost 2%, while Barclays and Commerzbank were advancing respectively 1.67% and 2.9%.

Insurers Axa and Ageas also took 1.8% and 2.19%.

EURO CLIMBS THE GREEK RETREAT RETURNS

"For banks, the agreement is not worse than was feared. Analysts had already built a partial loss and the number of twenty billion overall loss of circulating does not destabilizing, "said Pierre Flabbée, an analyst at Kepler Capital Markets.

"What matters is whether the markets will consider the agreement provides a substantive response to the crisis of the euro.There is progress in substance, with the extension of the intervention FSEF, but not in the amounts committed. "

Some analysts believe however that more losses are expected, including the fact that a modification of the terms of the Greek debt will likely cause a selective defect of Greece.

The Institute of International Finance (IIF), which represented the private creditors during negotiations, said that 90% of them will validate the agreement, including Deutsche Bank, HSBC, BNP Paribas, Axa or Allianz .

The euro has reacted positively to the announcement of the bailout, touching a high of $ 1.4440 two weeks before stabilizing around $ 1.4403.

The dollar suffered its part, however the contrast is drawn between the advanced European and protracted budget negotiations in the United States.

The yields of the Greek debt continued to decline in response to the new aid plan.Yields of 10-year paper yielded more than one percentage point to 15.56%, amplifying an already started back tenfold through the day revealed the first details of the plan.

The Greek paper returns to two years have also declined sharply, yielding 4.75 percentage points to 30.025%.

The CDS of the most fragile countries in the euro area have started in their wake a clear downward trend, the five-year CDS Greek yielding 380 basis points (bps) to 1675 bps, according to Markit data, the CDS Irish and Portuguese tightening over 100 bps 800 bps, respectively, and 850 bps.

Progress "significant" can be reported in the transformation of the financial system. The IMF still insists on the need to let the yuan appreciate, and reform the Chinese growth model. Employees of the factory's Etron Electronics Co. Ltd. in Suzhou, China.

China has made "considerable progress" to transform its financial system, but has yet to let the yuan rise and reform its growth model, said Thursday the International Monetary Fund. The directors of the Fund "commended the authorities [Chinese] for the considerable progress they have made to the financial system to rest more on supply and demand, and improve the regulatory and supervisory "said a document of the Fund.They also "emphasized that a mix of currency appreciation [Chinese] and reforms to rebalance growth model [the country] would result in substantial benefits both for China and for other country, "the statement said, reporting on a meeting of the Board of Trustees which was held July 15.

This meeting allowed the approval of the annual evaluation report of the Chinese economy by the IMF. In 2010, Beijing had authorized the Fund to publish this report for the first time since 2006. The 2011 report notes, as the previous year, the yuan remains "strongly below the level that would be consistent with economic fundamentals in the medium term."China agreed in June 2010 to let its currency fluctuate a little more freely against the dollar, but the Fund concludes that "despite its appreciation vis-à-vis the dollar, the effective exchange rate Real [Chinese currency] declined over the last twelve months ", compared to a basket of currencies representing the trading partners.

For the IMF, the rebalancing of the Chinese economy must be to rely more on growth in domestic consumption than on exports. The undervaluation of the yuan is regularly denounced by the trading partners of China, the United States and Europe in mind, but also by other emerging Asia Southeast in that it works so unfair Chinese exports. According to the IMF study, it is emerging that would have the most to gain from the appreciation of yuan.Beijing has pledged to gradually revalue its currency to make it fully convertible term. A former governor of the Bank of China said in late June that this process should take 15-20 years.

For directors of the IMF, everything is connected: the reform of the financial system – which must eventually lead to a balanced allocation of savings to the demand for capital – The convertibility of the yuan and the rebalancing of growth towards the Chinese domestic growth . And so does the interest of the planet as a whole since, according to the evaluation of services of the Fund, "China's ability to transmit or cause shocks [economic] is real growing up." So "the economic rebalancing is essential," the Fund in a report also released Thursday, and devoted to the study of the economic benefits of the country on the global economy.

On the Chinese economy, the Fund estimates that inflation, large social problem, is projected to peak in the next two months and then slow down. The IMF identifies the rise in prices as one of the main risks weighing on growth "robust" in the country with that of a housing bubble that could be taking shape.

Chancellor Angela Merkel Tuesday dampened the hopes raised by the organization of a summit Thursday on the Greek crisis, warning that one should not expect more than is reasonable.

"Further steps will be needed, a single spectacular event will not solve everything," she said at a press conference during a visit by Russian President Dmitry Medvedev.

The desire for a single solution that would finally put an end to the Greek crisis is unrealistic, she said, while at the same time, European leaders tried to resolve their differences on how to involve the private sector to a second aid package to Greece.

According to a document prepared July 16 and that Reuters was able to obtain, the leaders of the euro area defined by teleconference last week three main options for involving private creditors.

The Heads of State and Government of the euro area will meet Thursday in Brussels to determine how the second aid package to Greece.

A meeting is scheduled Wednesday in Berlin between Angela Merkel and French President Nicolas Sarkozy to "prepare the next meeting," said the Elysee Palace on Tuesday night in a statement.

The options detailed in tabular form in the document differ in the degree and type of private sector involvement.

The drafters of the document also assess the expected consequences on the sovereign rating of Greece, especially regarding the risk of seeing it placed in default, full or selective.

COMPLETE FAILURE RISK

The first option would be based on a redemption of Greek debt and credit enhancement ("credit enhancement") to the private sector, but it would likely defect selective or comprehensive in the country.

The document does not specify the nature of credit enhancement contemplated.

Mechanisms commonly used in the context of credit enhancement to use securitization, collateral and other guarantees that the holder of debt may receive as repayment of the debt.

Sources in the euro area reported that in one scenario, new Greek bonds of maturity 30 years would be exchanged against the existing Greek debt and that these new obligations would be guaranteed by the paper receiving the AAA rating , for example from EFSF (European Financial Stability Fund).

No figures are mentioned, but the document states that the cost of a rescue following this first option would be the sum of the Greek rescue plan, plus the cost of credit enhancements, plus the redemption of debt, most of the recapitalization banks of the country, the collateral provided by the European Central Bank, unless the private sector.

Taxing the financial sector

The second option, which could be based on the solution proposed by the French banks for working capital (rollover) of the debt does not include credit enhancement and does not repurchase debt.

It would lead a selective default, the document warns.

The cost to the EFSF would be that the new Greek program, plus that of the recapitalization of Greek banks and collateral to the European Central Bank (ECB), less the contribution of the private sector.

This solution would require the support of EFSF lower borrowing rates and longer maturities on its loans.

The ultimate impact on Greece's debt would depend on the effort could provide the EFSF on both counts.

The third solution, which would be less likely to trigger a selective default, provides for the taxation of the financial sector, and also offers lower rates and longer maturities of funds EFSF.

This solution not likely to cause a fault.The cost for the euro area is lower than the other two, since it would include the aid plan itself, minus the contribution of the private sector.

Again however, the EFSF would be forced to lower interest rates and extend the maturity of its loans to increase the positive impact on Greek foreign debt.

This proposal has provoked an outcry almost simultaneous French and German banks.

Asked about this project, François Perol held that a tax was not the right answer to problems facing Greece. "It does not seem that this is the way to Greece," said the president of the French Banking Federation.

Philips on Monday announced an unexpected loss of 1.345 billion euros in the second quarter, attributed to lower growth than expected and exceptional charges, and a plan to save 500 million euros.

The Dutch conglomerate had announced in late June that it expected a strong decrease in its second quarter results, while warning that caused a fall in the title.

Philips said in a statement having spent a provision of EUR 1.4 billion for impairment of assets on its lighting business and health.

The group warned last month that its second quarter results would be much lower than the previous one, with a slowdown in sales growth in lighting and consumer devices.

"It's generally a signal that consumers do not really head out of the water," said Hans Slob, an analyst at Rabobank.

Philips is the world's leading lights, one of three leading global medical equipment and the leading European producer of electronic devices.

The announcement of this loss takes the market by surprise, who expected a profit of 72.8 million for the second quarter.The group made a loss from operations (EBIT) of 1.123 billion euros (against a profit of 180 million expected) based on 5.2 billion in revenue (5.213 billion expected by the consensus).

Dutch electronics company has also announced a share buyback of two billion euros and a cost reduction plan which should enable it to achieve 500 million euros in savings.

The group announced build by 2013 a growth in turnover of about 4 to 6% – based on an average growth of GDP of 3-4% per year – with a margin EBITA of between 10-12% and return on invested capital of 12-14%.

CEO Frans van Houten said on CNBC that the stock repurchase program gave him enough financial margin to carry out targeted acquisitions and had no plans to close factories.

Shortly after 12:30, the title fell by 1.01% to 17.19 euros.

The Dow Jones, owned by News Corp., announced Friday the resignation of its CEO, mixed with the wiretapping scandal that hits the media empire of Rupert Murdoch.

The Hinton was responsible for overseeing the British newspapers owned by News Corp. at the time of the alleged crime.

New Corp is particularly owner Dow Jones and the Wall Street Journal. The entire group is shaken from the revelation of multiple telephone answering machines hacks led by the tabloid News of the World, which has since been closed.

This new warning shot has been extensively discussed at Wednesday's meeting between President Barack Obama and congressional leaders to try to find a solution. But despite four consecutive trading days, the positions of Democrats and Republicans still seemed difficult to reconcile.

The Republican majority in the House of Representatives refused to raise the ceiling of the federal debt without drastic cuts in spending to deal with an unprecedented deficit. Barack Obama wants to support these measures of higher taxes for the wealthy. What his opponents refuse.

Exchanges seem increasingly tense even if the minutes are different. According to a Republican consultant, speaking on condition of anonymity, M.Obama "has warmed up" and insisted that a comprehensive agreement is reached, after the head of the Republican majority in the House, Eric Cantor was proposed to raise the debt ceiling several times. A counselor Democrat, while acknowledging that Mr. Obama, impatient face as we approach the August 2, said "it's enough," denied that the president abruptly left the room.

The same source, Barack Obama warned his Republican opponents that he would veto a deal that would raise the debt ceiling in the short term. Negotiations should resume Thursday afternoon.

Earlier Wednesday, the president of the U.S. central bank (Fed), Ben Bernanke, warned that failure to pay would create "huge problems" for the country and a "major crisis" in the world."It requires both raising the debt ceiling that would allow us to avoid a default" payment, but "as we take serious steps to change the trajectory of our unsustainable fiscal situation" in the long term, said Bernanke before the Committee on Financial Services of the House. "I think these two objectives can be achieved."