DJIA chart reading : downside biased with possible pullback correction.
Hang Seng chart reading : downside biased with possible pullback.
U.S. Stocks Drop as Slump in Industrial Shares Offsets Home Sales Report (Source: Bloomberg)
U.S. stocks retreated, sending benchmark indexes to one-month lows, as a drop in stocks most- tied to economic growth offset a government report showing that sales of new homes rose to the highest level this year. Shares of industrial, consumer-discretionary and technology companies led the declines in the Standard & Poor’s 500 Index. Goodyear Tire & Rubber Co. (GT) retreated 3.1 percent as China appealed a World Trade Organization ruling that backed U.S. duties on Chinese tire imports, saying the levies are “protectionist.” Freeport-McMoRan Copper & Gold Inc. (FCX) and Occidental Petroleum Corp. (OXY) rose at least 2.9 percent as Goldman Sachs Group Inc. signaled a positive outlook for commodities.
Purchases of New Homes in U.S. Probably Stagnated in April Near Record Low (Source: Bloomberg)
Purchases of new houses probably held close to a record low in April, showing the real-estate market remains a weak link in the U.S. expansion, economists said before a report today. New homes sold at a 300,000 annual pace last month, the same as in March, according to the median forecast of 75 economists surveyed by Bloomberg News. Purchases sank to a 270,000 pace in February, the weakest in 48 years of data.
China to further cut power to industry amid summer shortage
BEIJING, May 24 (Reuters) - Electricity supplies to industrial users will be cut further this summer as capacity shortages, coal supply problems and declining hydropower output combine to produce the worst power crunch in years, China's top grid company said.
Power deficits in the 26 provinces and regions serviced by State Grid Corp of China (SGCC) would total 30 gigawatts in the summer, even if coal supplies remained steady, water levels were normal and there were no persistent high temperatures, SGCC Vice General Manager Shuai Junqing was quoted as saying by the State Grid News, a company newspaper.
China Economic Growth Estimates Lowered as Wen’s Monetary Tightening Bites (Source: Bloomberg)
Goldman Sachs Group Inc. joined banks lowering their forecasts for China’s growth as Premier Wen Jiabao’s campaign to rein in inflation restrains the world’s fastest-growing major economy. China’s gross domestic product will gain 9.4 percent in 2011, less than a previous call of 10 percent, Goldman analysts Yu Song and Helen Qiao wrote in a note to clients today. Credit Suisse Group AG, JPMorgan Chase & Co., ING Groep NV and Daiwa Securities Group also pared their estimates this month.
Japan Swings to Trade Deficit in April (Source: Bloomberg)
Japan had a trade deficit for the first time in three months as exports slumped in the aftermath of the March 11 earthquake and a surge in commodity prices pushed up import costs.
Japan’s Government Bonds Decline as Yields Near Six-Month Low Damp Demand (Source: Bloomberg)
Japan’s 10-year bonds fell for the first time in six days on speculation yields near the lowest level since November damped investor demand.
European debt fears keep markets on edge
LONDON, May 24 (Reuters) - Financial markets paused for breath on Tuesday after being battered a day earlier on euro zone debt concerns, with new warnings about contagion fuelling fears the crisis is heading for a new, more dangerous phase.
European shares -- still in the red for the year -- edged higher and the euro sat above two-month lows versus the dollar, both boosted somewhat by better than expected German business sentiment.
Moody’s to Place 14 U.K. Banks on Review for Downgrade, Sky News Reports (Source: Bloomberg)
Moody’s Investors Service is likely to say it will consider downgrading debt for 14 of the 18 British banks and building societies it covers as withdrawal of government support may increase credit risk, Sky News said. More than one of the U.K.’s four biggest banks will be among the lenders to be put on review today, Sky reported in a blog on its website, citing people close to the ratings company.
Greece Will Accelerate State Asset Sales to Stem Debt Crisis as Bonds Drop (Source: Bloomberg)
The Greek government endorsed an accelerated asset-sale plan and 6 billion euros ($8.4 billion) of budget cuts to win extra aid and stem a market slide that threatens to swamp debt-laden euro-area nations.
Germany’s Business Confidence Unexpectedly Stable in May as Exports Boom (Source: Bloomberg)
German business confidence remained unexpectedly unchanged in May as booming exports and rising company spending boosted economic growth. The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, held at 114.2 from April. Economists forecast a decline to 113.7, the median of 24 forecasts in a Bloomberg News survey showed.
German May business morale unchanged, beats fcasts
BERLIN, May 24 (Reuters) - German business sentiment held steady in May against expectations for a third consecutive monthly fall, signalling Europe's top economy may retain its strong momentum longer than thought before growth rates slow.
The Munich-based Ifo think tank said on Tuesday its business climate index, based on a monthly survey of some 7,000 firms, was unchanged at 114.2 from a reweighted April reading.
U.K. Financial Institutions Placed on Review for Lower Ratings by Moody’s (Source: Bloomberg)
Lloyds Banking Group Plc and Royal Bank of Scotland Group Plc are among 14 U.K. lenders whose debt Moody’s Investors Service is considering downgrading because the withdrawal of government support may increase their credit risk.
Budget Deficit Widens to $16.1 Billion as Tax Receipts Fall on Slow Growth (Source: Bloomberg)
Britain posted its largest budget shortfall for any April since monthly records began in 1993 as tax revenue fell and spending climbed, casting doubt on whether the government can meet its deficit-reduction target this year. Net borrowing was 10 billion pounds ($16.2 billion), compared with 7.2 billion pounds a year earlier, the Office for National Statistics said in London today. The median of 12 forecasts in a Bloomberg News survey was for a shortfall of 6.5 billion pounds. Revenue fell 0.8 percent, partly reflecting a one-time boost from a bank bonus tax a year ago, and spending rose 5 percent.
World Bank Will Lend Up to $6 Billion to Egypt, Tunisia Following Revolts (Source: Bloomberg)
The World Bank said it plans to provide as much as $6 billion in financing to Egypt and Tunisia over the next two years to help them modernize their economies after popular revolts toppled their leaders this year. Support would include $4.5 billion for Egypt, where the International Monetary Fund is also expected to provide a loan, World Bank President Robert Zoellick said on a conference call today. The Washington-based bank may also make $1 billion available to Tunisia, in addition to $500 million in aid announced last month and not yet approved by the lender’s board.
FOREX-Growth hopes draw euro off 2-mth low, still vulnerable
LONDON, May 24 (Reuters) - Upbeat data from Germany helped the euro recover from a two-month low against the dollar on Tuesday, but it remained fragile due to fears that the euro zone's debt crisis could spread. Data from the Ifo think-tank showed German business sentiment stabilising unexpectedly in May, pushing the euro briefly back above $1.4100 , away from Monday's two-month low of $1.3968.
It dropped again, however, after the leader of Greece's conservative political opposition rejected the government's new package of fiscal measures to slash deficits.
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