Business & Financial News

Greece still has no government. The risk of bankruptcy and the issue of leaving the euro area is raised again. Result: the stock prices fall and investors flock to German bonds, even if they yield nothing. The Eurogroup meeting will be devoted to Greece and Spain

After a difficult week, the stock markets reopened on Monday sharply lower against the backdrop of prolonged political stalemate in Greece, epicenter of the debt crisis, while be held a meeting of the Eurogroup.

Monday morning, Paris was losing more than 2% in early trade, London 1.33%, 1.31% Frankfurt. In Milan (-2.02%) and Madrid (-2.47%), the decline was more pronounced after banks have announced they will place new provisions because of subprime mortgage they hold in their portfolios. The day promises to be difficult, while "the risks to the euro area are still very real," said Chris Weston of IG Markets.

More than a week after the parliamentary elections, Athens still has no government. But the prolonged absence of government raised concern among investors in a delay or suspension of financial aid promised in Athens to enable it to meet repayment dates and ensure payment of arrears.

Monday, the Greek President, Karolos Papoulias, will try to snatch a coalition government during the final meeting between the country's political leaders. But many observers believe the country is moving towards new elections in June as the positions between pro-and anti-austerity diverge.  

Another sign of market nervousness, the 10-year rate of German bond (Bund) fell Monday morning at their historic low (1.47%). The political situation seems to push investors to turn to these securities deemed safe. "Investors plébiscitent increasing security even if the debt did their German report anything," said Nordine Naam, bond strategist at Natixis. He added: "Fears of an output of Greece of the euro are strong and, in case of persistent political deadlock in that country, the Bund interest rate expected to fall further in the coming days".

It was in this tense situation the finance ministers of 17 member countries of the euro area shall meet this afternoon in Brussels. A signal strength should be sent to Athens, to push the Greek authorities to put in a faster end to this in-between chaotic. Spain will, too, part of the program. The Spanish Minister of Finance, Luis de Guindos, will try to reassure, giving an overview of the reforms that Madrid will set up to consolidate its public finances. Is that Spain is in the viewfinder markets. The rate of its 10-year government bonds is back above 6%.

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Vallourec has revised downwards its growth forecast Thursday in turnover this year after beginning the exercise penalized by a demand remained weak markets as electrical energy and the automobile.

The producer of seamless steel tubes are now waiting for the current year to grow by about 5% of its turnover, while initially provided an increase of order of 10%.

In the first three months of the year, sales came out at 1.199 million euros, up 4% from first quarter 2011 but a contraction of 23% over the last quarter of 2011.

Its operating profit margin stood at 12.7% at end-March 2012, against 16.4% in the fourth quarter and 17.7% in Q1 2011. 

"What we see today is that the macroeconomic environment in Europe remains very uncertain and demand in markets outside oil and gas remains low," said Olivier Mallet , CFO of Vallourec in a conference call.

"(Demand) is well below our expectations at the beginning of the year," he added. "And if there was a slight rise in orders since January, it is below what was expected and visibility remains limited."

The group warned last February, on the occasion of the presentation of its annual results, expect a further decline in margin in 2012 due to the costs of de ; boot of his new plants.

Vallourec says still expect a "slight improvement" of its gross operating margin over the next three quarters, reaching a 15% margin over the full year.

At the Paris Bourse, the Vallourec share price closed before the quarterly earnings release, to 42.865 euros, up 1.46%.

Samsung Electronics posted record quarterly earnings of $ 5.2 billion (3.9 billion) by selling over 20,000 per hour Galaxy smartphones in the first quarter, beating Apple and iPhone.

The South Korean group was pleased with Nokia as the world's largest maker of mobile phones, after 14 years of rule by the Finnish group, today distanced the smartphone market .

Samsung has sold around 93.5 million mobile phones in the quarter January to March, more than a quarter of those sold worldwide, including 44.5 million smartphones, according Strategy Analytics. It controls and 30.6% of the global market for smartphones, against 24.1% for Apple, which sold 35.1 million iPhones in the first quarter.

"Samsung and crush their main rivals Apple and the smartphone market is likely to become a two-horse race," said Neil Mawston to Strategy Analytics.

Samsung will launch next week in London the third generation of its flagship model Galaxy S. The group hopes to see its sales boosted by the Summer Olympics, he is one of the first sponsors.

Apple said this week that its iPhone sales 4S had led to quintuple its quarterly revenue in China. But on this first global market of mobile telephony, the group remains at the apple behind by Samsung, which is already allied with the three main TV operators coms in the country.

The operating profit of Samsung in the first quarter nearly doubled to 5,850 billion won (3.9 billion euros), after reaching 5,300 billion won in the previous quarter .

After the announcement of these results, the action Samsung surged 2.9% to a record high of 1.38 million won (1,200 dollars).

The group also competes with Sony and LG Electronics on the TV market, Toshiba and Hynix in the memories SK and LG Display the segment of flat screens. 

Its earnings in semiconductors has been more than halved, to 760 billion won, due to falling prices of memory cards, but its activity in the tee ; léviseurs and appliances has generated 530 billion won against 80 billion a year earlier.

Samsung and LG Electronics compatriot among the few TV manufacturers in the world to make profits and gain market share in favor of including the use of 3D and OLED displays.

Sony, Panasonic and Sharp expect their side to show a combined loss of $ 21 billion during the fiscal year that just ended.

The first tripartite round table on the future of the plant PSA Aulnay-sous-Bois has resulted in no concrete progress on Friday and the prefect of Seine-Saint-Denis set the next appointment in late June, after the presidential election.

The interview between the State, represented by the prefect, the direction of the automaker and the unions and local politicians, claimed for nine months by them, was stormy said Jean-Pierre Mercier, representative of the CGT, and five trade unions on these seven left the room before the end.

"The unions have called for PSA agrees in writing (…) To maintain all jobs at least until the end of 2016, officially ended production of the C3, and assign a new vehicle to replace the C3. But management does not want to commit to anything, "he said

." The next date falls after the presidential and the law, it is exactly the speech Peugeot: do not use that either in the middle of election campaigns, "he said

… In an attempt to …… get rid of this calendar, the CGT called for a rally next Thursday before the campaign headquarters of Nicolas Sarkozy in Paris

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The Department of Industry, has said his side "fully alert and mobilized to the site's future automotive Aulnay-sous-Bois" and stressed in a statement, the group confirmed that it "does not consider the proposed closure of site in France." 

But at the roundtable, PSA Peugeot Citroëna again refused to discuss the C3 after repeating, as it has for several months, will still produce cars qu'Aulnay until 2014, unspecified beyond.

The builder also mentioned, the statement of the Ministry, the arrival on the surfaces of Aulnay-sous-Bois unused today, "new economic activities complementary ments ".

PSA declined to comment on the roundtable, but a spokesman said that about 40,000 square meters on the site now unused, 23,000 were de ja and 17,000 rental available for rental for industrial and real estate. 

The factory in Aulnay-sous-Bois, which produces the small Citroen sedan, employs 3,500 people and seems the most threatened European sites of PSA while the group was given two years to re ; Gler the issue of persistent overcapacity in Europe.

The fate of the Madrid plant also raises questions as no model has been announced to take forward over the last Peugeot 207 assembled therein.

Wall Street opened sharply lower Wednesday, still within the scope of the minutes of the last meeting of the Monetary Policy Committee of the U.S. Federal Reserve seems to suggest that that new measures to support the economy are no longer topical.

In early trade, the Dow Jones yielded 0.91% (or 120.49 points) to 13,079.06 points. The Standard & Poor's, wider, lost 0.86% (12.10 points) to 1,401.28 points while the Nasdaq composite fell back to 0.89% (27.82 points) to 3085, 75.

This decline, following a decrease of about 0.5% yesterday, comes despite better than expected figures for employment in the private sector. According to ADP monthly survey, the private sector has indeed created 209,000 jobs in March, against 200,000 expected.

But what continues to attract the attention of investors is that only two members of the Monetary Policy Committee of the Fed felt that other measures could be necessary if the Economic activity weakened or if inflation remained at a low level for an extended period.

Support measures implemented by the U.S. central bank was the main catalyst for a jump of 30% recorded by the S & P 500 since October, although improving conditions in the United States, as reflected by the indicators, also played. 

"The minutes of the Fed questioned the certainties of those who thought they could relax without end," said Sal Arnuk, co-head of investments at Themis Trading.

For its part, the European Central Bank has unsurprisingly left rates unchanged at a record low, Mario Draghi, chairman of the ECB, saying it was pre premature to start talking about the withdrawal of the measures to end the crisis.

The title General Electric, Heavyweight Dow Jones down 1.3% to 19.70 dollars after Moody's downgraded the industrial conglomerate from Aa2 to Aa3. 

The action Sandisk falling more than 9% after the specialist NAND chips has reduced its forecast for sales in the first quarter, citing lower demand than expected and conditions unfavorable pricing.

India has formally followed the lead of China Thursday asking its airlines to refuse to participate in the program of the European Union to tax carbon emissions in the air transport, confirming what was said a senior Indian official told Reuters.

"While the European Union ordered the Indian carriers to submit the details of their aircraft emissions by 31 March, no company due to the fact the government's position" , said Ajit Singh, Minister of Civil Aviation.

"Therefore, the imposition of a carbon tax is not an issue," he said in a letter.

The European Commission was not immediately available for comment information. 

The opposition of India in the exchange system of emission quotas for greenhouse gas (ETS) could jeopardize the chances of New Delhi to reach an agreement, being born in ; negotiation, free trade with Brussels.

China first allowed its air transport sector to participate in this program.

Since 1 January, all airlines flying from airports in the EU are subject to a trading system of emission quotas for greenhouse gas (ETS).

A company failing to observe these rules is liable to a tax of 100 euros per tonne of carbon emitted quota allowed. The EU ban of up to serve European airports.

China has suspended the purchase of Airbus representing $ 14 billion because of the dispute with Brussels over the carbon tax. India is also a major customer of Airbus.

Airbus officials, airlines and European engine wrote last week in the Old Continent's political leaders urging them to resolve the dispute caused by the introduction of this carbon tax.

Boeing has supported Airbus in this matter, despite the bitter legal battle being waged for years the two aircraft manufacturers about the legality of state aid received to develop their planes. 

"It is no Airbus and Boeing, this is what is most beneficial to our customers and how the industry as a whole can reduce its carbon footprint," said ; Reuters Jim Albaugh, CEO of the Civil Aviation Division of the U.S. group.

"In my opinion, the European ETS is not the right approach. It must be suspended and we must work with the ICAO (aviation agency of the United Nations) to establish regu international rules that everyone can see. "

The number of referrals to the Ombudsman of energy increased 14% in 2011. At issue: payment difficulties. The Ombudsman proposes to introduce a general truce breaks from November 1 to March 15.

The cases of fuel poverty rose sharply last year in France, as a result of the crisis and rising energy bills and gas, says National Energy Ombudsman in his 2011 report published Tuesday. The Ombudsman, an independent administrative authority which began operations in 2008, saw its number of referrals increase by 14% last year, in 8044, it said in its annual report, up a bit weaker than the explosion recorded in previous exercises.

But of that total, the number of cases related to payment difficulties has increased by 80% compared to 2010, and represented over 15% of all referrals, calculated the Ombudsman. "The economic crisis and rising energy prices have compounded the problem of fuel poverty", that is to say, struggling to pay their electric bills or gas, and pushed more and more income households to seek mediation, the institution said. The Ombudsman recalls in passing that the regulated gas prices rose 25% in two years, and those of electricity by 8%.

The Ombudsman also proposes measures to better fight against the rise of fuel poverty, considering the schemes (such as social tariffs for electricity and gas, whose allocation has been made automatic for all eligible households ) insufficient, even if they are "in the right direction." It proposes the establishment of a general truce breaks from November 1 to March 15 for all consumers, on the model of the winter break of evictions (a truce energy cuts already applied but only for some consumers), and the establishment of an "energy check", which may be substituted for social tariffs.

General Motors announced Monday it will pay 320 million euros to take 7% of French carmaker PSA Peugeot Citroen.

The manufacturer also says that the partnership plans to build at least four common models by 2016.

In a regulatory document sent to the Securities and Exchange Commission, Constable of the American Stock Exchange, General Motors said that the alliance is expected to last 10 years and will be renewed ; unless either party has an objection to this extension. 

Peugeot unveiled last week its strategic alliance with General Motors through which it hopes to save on purchase costs and development , with an entry of U.S. giant in its capital up to 7%.

The alliance will go off if a competitor of GM captured 10% or more of Peugeot, directly or indirectly, the U.S. group says in a statement.

Meanwhile, the partnership may be terminated if the share held by the Peugeot family falls below 15% and a competitor amounts to 5% or more in the French manufacturer.

A clause further provides for an end to the partnership if another automaker acquires 3% of PSA following an agreement with PSA Peugeot or with family.

Universal Music, a subsidiary of Vivendi, has requested a green light from European authorities to buy back the recorded music division of the British label EMI, said Monday the European Commission on its website.

The operation of some € 1.4 billion would allow the first record company to add to its global catalog Coldplay and Katy Perry for example. But it may be a long and careful consideration of the competition authorities.

In November, Universal said hold 26.5% of global recorded music. By merging its operations with those of EMI, the group would control, in some European countries, over 50% of the market.

The European Commission, guardian of competition in the Union, was given until March 23 whether to grant the green light for the operation.

The International Monetary Fund is considering a loan of 13 billion euros to help new international bailout for Greece, according to the Wall Street Journal. IMF Executive Director Christine Lagarde during a press conference in Washington on 6 July 2011.

The International Monetary Fund plans to contribute a loan of 13 billion euros in the new international bailout for Greece, said Friday the Wall Street Journal on its website. "The size of the IMF's contribution has not yet been decided" but the institution currently looking for the money, the newspaper said, citing people familiar with the matter in an article written from Brussels.

The IMF granted in May 2010 a loan of 30 billion euros in Athens, as part of an international plan of 110 billion. It has not been enough to revive the Greek economy, which sank in a severe recession, exploding public debt. Finance ministers from the euro zone must meet in Brussels on Monday to consider whether the conditions exist to implement a second level of support in Athens, including a public component of EUR 130 billion and partial clearing of debt held by private creditors to the tune of 100 billion.

Greek Prime Minister Lucas Papademos, counterparts Angela Merkel and Italian Mario Monti, and French President Nicolas Sarkozy on Friday expressed their confidence in the possibility of reaching an agreement when, after several postponements. February 9, an IMF spokesman, Gerry Rice, stated that before you can obtain a new loan, he was "very likely" that Greece has to undertake "prior actions" to show its commitment to measures required of it to improve the functioning of its economy.