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World News Hammer Markets, Confidence
Cars, planes, retailing, engineering, food and assemblies around the world cut earnings forecasts, Production or jobs on Friday in one of the darkest days of the year so far for earnings and stock market reports confidence.
And there are even more of the same week (see below).
The announcements from Australia to Brazil, Japan, North America and Europe are clear signs of impending recession which is not going to crunch the outcome of the Bank 40% or more from current levels for equity strategist at Citigroup in London.
The Australian dollar was on Friday hammered shed more than 12% of its value against the yen and 8% against the U.S. dollar in the biggest single investment one day fall since floating back in 1983.
There was no apparent reason.
Citigroup's team said in a note to clients around the world last week that "History teaches us of the gravity the coming economic downturn should be greater than normal.
"Recessions following previous periods of financial crises have lasted twice as long as normal. The lost economic output is even greater.
"The result downturn – More severe economic weakness likely drive a deeper and longer global corporate earnings downturn.
"We believe we are in the early stages of a recession found that last for at least 2 years could, with roe to decreasing 8% and EPS decline of 40-50%.
"Global equity valuations suggest investors have already anticipated most of the decline yields discounted. Recent Reviews are back to 1970 average. "
"Economic growth has slowed in emerging markets as well. In Asia-Pacific region think of our economists-wide GDP growth in 2009 will be the slowest in eight years.
"But given the current financial crisis does not from their backyard this time, the growth should be easily accessible through the depths during the Asian crisis.
"The outlook is darker for other emerging markets more dependent on capital inflows. "
Currencies lost ground against the U.S. dollar and / or the yen, the Aussie dollar fell by 8% and 12% or more against both currencies respectively on Friday. Copper, oil and most other commodities fell. Only nickel rose on the back of production cuts by the giant Vale Group of Brazil, the world's second largest producer.
There was evidence of hedge funds accounted for some of the turmoil on Friday. They are forced to sell their shares, Sell bonds and other instruments to pay off their investors and lenders. In addition, the investors increasingly convinced that the world economy for a long, painful recession is heading.
The hedge fund group Citadel reassured investors at the weekend that it had enough liquidity and that Fed inspectors were not talk to it.
But nerves are in the hedge fund industry as investors recall stretched their funds, billions of dollars in investments are sold and the stability of more and more groups called into question (about $ US200 billion has been turned off, the value of the fund in recent months and wiped a few hundred funds of different Types have gone bust, been wound up or reduce business where they are no longer significant players).
The flight to safety is violated once mighty Currencies like the British pound. On Friday, worries about how the financial crisis would affect Britain's economy caused the pound to depreciate against the dollar, 8c, falls to $ 1.53.
On Wall Street the Dow Jones Industrial Average slumped 312.30 points or 3.6%, to 8,378.95, in a volatile session, the blue chip index saw himself as much as 500% at one stage.
The Australian stock market wiped 30000000000 $ from its value to the end of the week as to its lowest level in almost four years All Ordinaries fell 107.7 points or 2.73%.
That was a loss of 3% over the week, the relative outperformance compared to the sharp fall was at the Wall Street, Tokyo and London. The Australian dollar fell hard on Friday to close nearly 6% over the week at 62.20 USC.
The South African rand fell 11%.
Not even the 1.5 million barrel per day production cut by OPEC, oil prices stop falling in the face of swelling fears of a deep global recession.
In New York the Standard & Poor's 500 index fell by 3.5% and the Nasdaq slid 3.2%. Both trimmed steeper falls in morning trading. But there was a significant decline in the market, right at the end as funds sold again hit prices.
For the week the Dow lost 5.3%, the S & P 500 lost 6.8% and the Nasdaq fell by 9.3%.
So far this month, the Dow is off 22.8%, the S & P 500 is off 24.7% and the Nasdaq up 25.8%, bring on the way to the worst month since the October 1987 crash.
In the S & P's case, this could be the end of October the worst month ever in the post-World War II era.
The trio is down more than 40% since the Dow and S & P 500 hit all-time high a year ago and the Nasdaq hit a bull market high.
The Australian SPI 200 futures were 37 points lower start at 3840, evidence of lower today.
In the U.S. the bad news about Banks continued: The authorities in Georgia have failed suburban Atlanta bank after a closed. The Georgia Department of Banking and Finance closed the two Branches of Alpha Bank and Trust in Alpharetta on Friday the 16th U.S. Bank is not this year.
Iceland's government said it had asked for $ US2 billion stepped up to support from the International Monetary Fund to do the first western country since 1976, Belarus (besides Russia) Iceland, Pakistan, Hungary and Ukraine in requesting at least $ US20 billion a state of emergency loan from the International Monetary Fund for help to repay the debt.
The IMF agreement with Ukraine on a $ US16.5 billion loan to help support the nation's financial system as turmoil in global credit markets and recession concerns roil the eastern European country.
The two-year stand-by loan will depend on parliamentary support to adopt legislation banks in the country. Ukraine also needs to address the budget and the offset the current account deficit.
Argentina, struggling to avoid its second default in a decade, strives for Middle nationalization $ US29 raise billions of private pension fund, a move that has sounded the alarm bells and was founded in Spain, where the country's largest banks have huge loans and investments in Argentina (and Brazil and Mexico, where the market and currency risks have fallen).
The IMF said at the weekend that it agreed provisionally had the loan and Iceland had announced to save in addition to hundreds of billions of dollars for the peoples concerned. (Article in The Economist and the Financial Times at the weekend, it could finance up to $ US250 billion or more in loans and credits in standby.)
"The IMF has more than 200 billion Dollars in loans and can have access to additional resources through two standing borrowing arrangements said, with groups of IMF member countries, " the institution on its website.
The fund is discussing plans to offer so-called hard currency loans of three minutes, six months ago in a multiple the country's quota of up to five times as large.
On proposed that multiple, South Korea's IMF quota of $ US4.4 billion, this means could be so much as $ US21.8 billion EUR in the framework of the program. Mexico might qualify for $ US23.5 billion to $ US22.6 billion for Brazil and $ US10 billion € for Poland.
Iceland Friday was the first western nation to seek aid from the IMF since the UK in 1976. The economy will shrink by as much as 10%. It is part of a multi-group finance package that could total more than $ US6 billion euros.
China, Japan and 11 other Asian countries agreed to a $ US80 billion fund to fight the credit crunch, The Bank of Japan is one of those central banks that help fund the rescue plan for Iceland, according to media reports last week, together with the central banks in Scandinavia.
More than 40 European and Asian leaders called for an overhaul of World War II-era banking rules.
The Heads of State and Government "Guaranteed effective and comprehensive reform of the international monetary and financial systems," according to a statement issued after the meeting in Beijing at the weekend. Bloomberg Chinese Premier Wen Jiabao quoted as saying that "we need even more financial regulation to ensure financial security''.
The U.S. Treasury announced that planned capital injections in 20 new banks on Friday, but will allow the banks to reveal the offers. PNC lost $ US7 Billion in acquiring the help of a large regional bank in Ohio.
The Finance Ministry has also been examined, as reported, it could facilitate, Bonds and mortgage insurance, give rescue package under the $ US700 billion U.S. financial services.
And while General Motors has intensified negotiations buy Chrysler auto operations, say U.S. reports it now has plans to seek government support for any deal.
More news from the auto industry was appalling on Friday: truck giant Volvo is released over a 1500 more employees after it reported third-quarter orders dropped to 115, more than 41,000 in the same Quarter of 2007. It has already cut over one thousand employees.
Chrysler announced Friday that 5000 sacking 32,000 employees in the U.S. and Europe, as soon as it tries its parent, Cerberus, a comfortable merger deal with General Motors to do.
Daimler was reported yesterday superior to the German media for a month trying to leave production in all car plants for Christmas, and cut stocks of cars and to avoid unwanted Begin to lay off employees.
The break in production would be on 11 Begin in December and to 12 January, according to the reports. Daimler, the first luxury car maker its present quarterly results, unveiled big falls in profits on Thursday and issued a new profit warning for 2009 because of the global banking crisis that hit Germany and has its major U.S. markets very hard.
"The financial crisis turns into an economic crisis," Daimler CEO Dieter Zetsche told a telephone press conference on Thursday, and it had provoked "in recent weeks a dramatic slump on our major markets".
Volkswagen says it will more cars make this year, but 2009 is bleak, it is cutting off 750 contract employees in Germany by not renewing their contracts over the rest of the year. Volkswagen reports its latest financial results this Thursday night our time.
French automobile giants PSA Peugeot-Citroen and Renault ordered huge Reduce production, while Japan's hi-tech giant Sony Corp. and Europe's biggest airline Air France-KLM issued profits warnings.
Renault has almost all his works closed for French order at least one week and shorter shutdowns in Turkey, Russia and Slovenia. PSA Peugeot-Citroen chairman Christian Strieff said he had "massive" production cuts as the group forecast a decline to appoint 17% in car sales in Western Europe in the fourth quarter (After an 8%-plus drop in September).
Air France-KLM shares fell by 9%, as the airline not only said it would be "very difficult" to Performance of its billion-euro earnings target, but also revealed plans to reduce costs by up to € 1200000000, which can only mean to hack job losses.
Toyota confirmed it sold fewer cars in the September quarter compared to the previous year, the first quarterly decline since 2003. Japanese automaker start reporting first half and second quarter this week with Honda for publishing its figures tomorrow night and Toyota one weeks Wednesday.
Toyota said Global car sales went up 4.3% in the September quarter, a year earlier, the first decline since 2001. The stock fell by 6.4%. It is made of more than 40% this year and Tokyo as a whole for more than 50%.
Brazil's Vale, one of the world's top three miners, said that Chinese demand for metals was down sharply, but that ship iron ore without it paid a 12% increase, the prices of their Australian rivals were the same.
But it is cutting nickel production in China and delay start-ups at new mines in Brazil and New Caledonia, and reviewing other mining.
In the UK, confirmed the official Figures country was about to enter a recession in the third quarter with growth contracting by a sharp 0.50%.
The official figures on Friday supported forecasts earlier in the week before a recession from the Bank of England head Mervyn King and Prime Minister, Gordon Brown.
The Japanese Nikkei index plunged on Friday 9.60% and below 8,000 points for the first time in more than five years.
The close was 7,649.08, a level not seen since April 2003 and only 41 points from the lowest State since 1982. Asia and Japan's largest building materials group Taiheiyo Cement Corporation, said that it caused, to a first half loss because of declining demand in Japan. The loss was more than double previous estimates.
Hong Kong fell by 8.3%.
South Korea's Kospi Index rose 11% on Friday to its lowest level since May 2005. The index fell by 20.5% last week, the worst drop since 1987, while the won also broken into.
India's Sensitive Index plunged by 11% Friday, its biggest slump in 16 years after the Reserve Bank said it will continue fighting inflation, reducing the likelihood strengthening of easy loans for growth.
The central bank surprised a week ago with a 1% interest rate, but seemed to doubt that votes on Friday.
European shares were up to 10% in early trade Friday lost earlier Friday in a repeat of the terrible two weeks. French stocks fell by 8.0% early on a five-year lows finish, off 3.5% at the end. Frankfurt's DAX was 30 and the London FTSE 100 represents approximately 5%.
Sony, a leading provider of corporate Japan, saw its shares plunge by 14% Friday after the publication of forecasts of low profits Thursday night. Sony has a board meeting in Tokyo this week more to consider cuts.
ArcelorMittal, the world's largest steel producer, closed smelting furnaces on a temporary basis in France, Germany and Belgium, according to union chiefs who met with management. It is reported that its $ US35 billion global expansion review.
U.S. figures show that 19 of the country's 25 steel blast furnaces are to either close or be shut down for varying periods of time, is so large, the declining demand in the past two months, since mainly the car industry.
Timken, the world's largest ball bearing manufacturer, the production and earnings forecasts because of falling demand from the auto and construction machinery sectors slashed (Caterpillar).
Timken blame the cut in his fourth Quarter earnings forecast on "the timing of certain raw-material cost recoveries and lower automotive industry demand.
In other words, the demand weaker now is so fast that it does not try to put prices up and recovery of the earlier rise in the cost of steel a year.
Spain, the unemployment Rate jumped to 11.33%, a four-year high, as the collapse of the housing and construction sector throws more people out of work. The worries about Brazil and Argentina are particularly to take their toll earlier sound banking sector in Spain.
New figures meanwhile showed Britain's economy shrank by 0.5% in the three months compared to September the previous quarter, marking the first contraction since 1992.
The British economy to a standstill in the second quarter with a proposed zero-growth and the slump in the red unemployment surged accelerated, crashed home sales, construction, industrial production and retail trade, rising inflation.
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