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Foreign Invest In Slovakia Doubles In 2007 To EUR1.28B - AFP

Thu, Jan 17 2008, 16:10 GMT
http://www.djnewswires.com/eu

Foreign Invest In Slovakia Doubles In 2007 To EUR1.28B - AFP

BRATISLAVA, Slovakia (AFP)--Foreign investment in Slovakia doubled in 2007 to EUR1.28 billion, Sario, the investment promotion agency, said Thursday.

"This is double the investments compared with 2006," Sario director Peter Hajas said in a press conference, adding Slovakia's high economic growth was also a factor in the rise.

Sario closed 64 deals with companies in 2007. The highest number of projects, 16, were realized in the underdeveloped, eastern Kosice region.

Most projects were in the engineering, electronics and car industry sectors and were expected to create between 14,738 and 16,852 jobs.

In 2006, Sario completed 65 projects worth EUR607 million.

Sario is working on 146 new projects this year worth around four billion euros. Most of the investors come from Germany, the U.S., the U.K., Belgium, South Korea, Austria and Italy.

Slovakia reported economic growth of 9.4% in the third quarter of 2007.

(END) Dow Jones Newswires

January 17, 2008 11:10 ET (16:10 GMT)


Copyright 2008 Dow Jones & Company, Inc.

 

[surf4sports]

Foreign investment in Slovakia doubles in 2007

Thu, Jan 17 2008, 16:16 GMT
http://www.afxnews.com

BRATISLAVA (Thomson Financial) - Foreign investment in Slovakia doubled in 2007 to 1.28 bln eur, Sario, the investment promotion agency, said.

"This is double the investments compared with 2006," Sario director Peter Hajas said at a press conference, adding that Slovakia's high economic growth was also a factor in the rise.

Sario closed 64 deals with companies in 2007. The highest number of projects, 16, were realised in the underdeveloped, eastern Kosice region.

Most projects were in the engineering, electronics and car sectors and were expected to create between 14,738 and 16,852 jobs.

In 2006, Sario completed 65 projects worth 607 mln eur.

Sario is working on 146 new projects this year, worth around 4 bln eur. Most of the investors come from Germany, the United States, Britain, Belgium, South Korea, Austria and Italy.

Slovakia reported economic growth of 9.4 pct in the third quarter of 2007.

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afp/cmr

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Bernanke says inflation 'has to be part of the equation' even in downturn

Thu, Jan 17 2008, 16:12 GMT
http://www.afxnews.com

WASHINGTON (Thomson Financial) - Federal Reserve Chairman Ben Bernanke told Congress today that even in time of economic slowdown, "inflation has to be part of the equation" in determining Fed policy.

He said that "people have increased their inflation expectations for the very near term" and that is understandable, given what's been happening to energy and food prices.

However, the Fed also "takes some comfort" from the fact that "generally speaking, both firms and households have kept unchanged their expectations of what inflation will be over the longer term," the next five years or so.

In his prepared testimony for the House Budget Committee, Bernanke conceded the Fed is concerned about the rise in core inflation and that "part of this rise may reflect pass-through of energy costs to the prices of core consumer goods and services, as well as the effects of the depreciation of the dollar on import prices."

But, the Fed chairman said, as long as the public's confidence in the Fed's commitment to fighting inflation is "unshaken," both headline and core inflation "should moderate this year and next."

If, however, inflation expectations become "unmoored," the Fed's task will become much more difficult.

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dem/wash/cmr

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Treasurys rally; Philly Fed plunges

Thu, Jan 17 2008, 16:14 GMT
http://www.afxnews.com

NEW YORK (AP) - Treasury prices soared Thursday after a Philadelphia regional manufacturing survey unexpectedly showed a deep and worrisome contraction in factory activity this month.

The Philadelphia Federal Reserve's manufacturing index plunged a full 20.9 percent in January, after dropping a much smaller 1.6 percent last month. A median of economists polled by Thomson/IFR had forecast a drop this month of just 1.3. None of the analysts expected a larger fall than 7 precent.

"This data point screams recession," said T.J. Marta, fixed income analyst at RBC Capital Markets. "Although data has been grinding lower, but this is the first true recessionary indication."

Although the weakness in regional and national manufacturing is well known, the news startled investors and distracted them from strong hints of new rate cuts and upbeat remarks about a possible economic stimulus package from Federal Reserve Chairman Ben Bernanke.

"Bernanke's speech is mainly a reiteration of earlier ones," said RBC Capital Markets' Marta. "There is not much news here."

The benchmark 10-year Treasury note shot up 15/32 to 104 23/32 with a yield of 3.67 percent, down from 3.74 percent late Wednesday. Prices and yields move in opposite directions.

The 30-year long bond gained 21/32 to 111 24/32 with a yield of 4.29 percent, down from 4.35 percent late Wednesday.

The 2-year note rose 4/32 to 101 17/32 with a yield of 2.45 percent, down from 2.51 percent the day before.

Bernanke's comments seemed to have a greater effect on stock trading than on Treasurys. During a Capitol Hill visit, Bernanke threw his support behind a possible Federal package to stimulate the faltering economy. He said any plan should be efficient and timely. and he reiterated concerns about the economy, adding that he is now worried businesss spending will slow.

Bernanke also said the risks of an economic downturn are more pronounced, and that the housing sector will be a drag on the economy for much of this year.

Other data made clear that the housing sector continues to unravel. The Commerce Department said housing starts plunged 14 percent to 1.01 million in December, marking the weakest pace of home building in more than 16 years. In addition, permits to build new homes dropped 8 percent last month to 1.07 million, the lowest level since 1993.

Thomson/IFR had forecast smaller declines for both housing starts and building permits. Still, some economists pointed out that the weakness may prove helpful in the long run, as smaller inventories of homes will take some pressure off the housing sector.

The day's sole piece of positive economic news came from the Labor Department, which announced a startling 21,000 decline in initial jobless claims to 301,000 in the lastest week. Claims had been expected to rise by 8,000 to 330,000, according to Thomson/IFR.

Very weak jobs generation last month has stoked concerns about a sharp labor market slowdown, but the latest figures suggested those fears may be overblown. Still, the weekly tallies are volatile.

Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

 

[surf4sports]

Bernanke says permanent tax cuts might help, but quick stimulus more effective

Thu, Jan 17 2008, 16:22 GMT
http://www.afxnews.com

WASHINGTON (Thomson Financial) - Federal Reserve Chairman Ben Bernanke said today that making permanent the tax cuts that President George Bush pressed for earlier in his presidency could provide some help in the short term, but said Congress should focus on a faster, near-term tax break that would more efficiently stimulate the US economy.

"It's possible that making the tax cut perm might have some near term effect," he said in response to a question at today's House Budget Committee hearing today. "For example, making dividend relief permanent could affect today's stock market."

Nonetheless, he said extending the tax cuts is more of a longer-term issue, along with other issues such as entitlement reform, and that Congress should focus on other changes that can be made to more quickly stimulate the economy.

"Our discussion today is about short-term stimulus," he said. "The evidence suggests that measures that involve putting money into the hands of households and firms that will spend it in the near term will be more effective."

Bernanke also said a stimulus package of about 100 bln usd would be "significant," and said a package of this magnitude would "not be window dressing."

He added later in the hearing that it would be "counterproductive" to include a tax increase in a stimulus package.

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pik/wash/ajb

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[surf4sports]

Odds of further rate cut increases after Philly Fed, erasing earlier decline

Thu, Jan 17 2008, 16:22 GMT
http://www.afxnews.com

NEW YORK (Thomson Financial) - The odds of further interest rate cuts increased Thursday, reversing earlier declines, after the release of data showing that manufacturing activity in the Philadelphia region was much worse than expected.

February fed funds futures tacked on 0.01 to 96.36, which implies an 81% chance that the Federal Reserve will lower its target for overnight rates by 75 basis points to 3.5% after its next policy setting meeting on Jan. 30. Late Wednesday, the odds were at 80%.

The Philly Fed index dropped to -20.9 in January, while the median estimate of economists surveyed by IFR Markets had been expecting an improvement to -1.3 from last month's -1.6.

Earlier Thursday, the odds of a 75bp rate cut fell to as low as 74% after the Labor Department said weekly jobless claims fell 21,000 to 301,000, the lowest level seen in four months. Economists had been expecting a rise to 335,000.

Tomi Kilgore

tk1

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[surf4sports]

Metals - Copper holds onto gains as Fed chairman Bernanke begins testimony

Thu, Jan 17 2008, 16:23 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - Copper held onto earlier gains as Fed chairman Ben Bernanke began his half-yearly testimony to the House Budgetary Committee on the current outlook for the US economy.

Players, already pricing in a 50 basis point rate cut at the end of this month, were encouraged by statements the chairman made about a stimulus package for the US economy.

Offsetting this, however, were more negative comments on the outlook for the US economy, which re-ignited demand worries and sent the rest of the metals complex down on the day.

Fears the US is set to slip into recession have been weighing heavily on metals all week, leading most of them to reverse gains made earlier this year on increased fund buying and index reweighting.

All the same however, analysts remain sharply divided as to the extent to which US economic weakness will weigh further on metals, which fell sharply towards the end of last year on macro economic concerns.

JP Morgan analyst Michael Jansen said while he expects a relatively weak first quarter in metals, he thinks the complex has largely priced in a weak macro environment.

Regarding copper, he said further sharp falls in LME inventories are underpinning the metal at present, while bargain hunting and trade buying is also helping prices stay in positive territory.

At 3.58 pm, LME copper for 3 month delivery was up at 7,065 usd a tonne against 7,000 usd at the close yesterday, when the metal lost 120 usd on the day.

"Recession fears are still at the forefront of everyone's trading strategies," said analysts at RBC Capital Markets. They added, however, that declining copper stocks are currently preventing heavy selling.

The LME said in a daily report today copper stocks held in its warehouses fell by a large 5,500 tonnes to total 185,550 tonnes. Stocks have now fallen for eight days straight.

Analysts at Fairfax said the decline in LME copper stocks has come about as a result of increase in physical buying from China, the world's largest copper consumer.

However, markets are still nervous as the extent to which China will be able to pick up the slack should US copper consumption dry up in the face of a recession.

Data out earlier painted a bleak picture of the US housing market, a key driver of copper demand.

Housing starts dropped by a faster than expected 14.2 pct in December to hit their lowest level in more than 16 years, according to data released by the Commerce Department.

The Department also said building permits fell by a more than expected 8.1 pct, and that declines in housing starts and permits for the year as a whole were the sharpest seen in more than 25 years.

"Given the weak outlook for the US economy it is easy to be bearish for base metals and over the long run we think a downturn in the US will drag down the global economy enough to see metal prices fall significantly later in 2008.

"However, near term we think there is room for some rebounds as China steps up imports and reduces exports across the metals and as consumers switch from destocking mode to hand to mouth buying," said BaseMetals.com analyst William Adams.

Elsewhere, lead was down at 2,540 usd a tonne against 2,609 usd, with analysts saying it might struggle near term as supplies from Australia, shut in for nearly a year now, are expected to come back on stream shortly.

The Australian authorities have reportedly given conditional approval for Ivernia's Magellan mine to ship lead concentrates via the alternative port of Freemantle.

The news "may prove a hurdle for lead prices, but given this has been expected for a number of months now this may well already be in the price", said BaseMetals.com's Adams.

Nickel fell to 27,650 usd against 27,900 usd, however analysts at Fairfax IS remained cautiously upbeat on the outlook for prices amid hopes demand from the stainless steel sector will pick up shortly.

"Reports indicate that Chinese firms are holding off purchases of nickel hoping for weaker prices, although this could be a dangerous game with significant increases expected this year in terms of demand from new stainless steel capacity and production," Fairfax IS analyst Marc Elliot.

In other metals, tin was up at 16,350 usd a tonne against 16,300 usd, aluminium was down slightly at 2,446 usd against 2,469 usd while zinc edged up to 2,285 usd against 2,280 usd.

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ma/lam

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[surf4sports]

Spain Opposition Politician:Indebted Families Need Tax Relief

Thu, Jan 17 2008, 16:31 GMT
http://www.djnewswires.com/eu

Spain Opposition Politician:Indebted Families Need Tax Relief

MADRID -(Dow Jones)- Spain's heavily indebted families need tax cuts in the face of tightening euro-zone financial conditions, Manuel Pizarro, the opposition politician tipped to be finance minister if his Popular Party wins March 9 general elections, said Tuesday.

"I believe it's best if money stays in the taxpayer's pocket...when people have difficulties coping with the Euribor (the rate at which euro-zone euro interbank term deposits are offered by one bank to another) at 4%, we have to help low-income families to pay their mortgages, and not let them lose their homes," Pizarro said.

Pizarro, former head of electricity company Endesa (ELEYY), was meeting the press for the first time since his surprise inclusion in the PP's electoral list earlier this week. PP leader Mariano Rajoy has declined to confirm media reports that Pizarro would become finance minister if his party wins the upcoming elections.

Recent polls show the PP and the ruling Socialist Party in a virtual dead heat.

The PP has made tax cuts one of the cornerstones of its election program, promising to lower the Spanish corporate tax rate, currently one of the highest in the euro zone, and to exempt from income tax people who earn less than EUR16,000 a year.

Pizarro is famous in Spain for his role at Endesa in fending off a hostile takeover bid from Gas Natural SDG SA (GAS.MC), a bid that was widely seen as supported by the current government, which wanted to see the creation of a national energy champion.

Endesa was later taken over by Italian electricity company Enel SpA (EN) and Spanish infrastructure company Acciona SA (ANA.MC).

-By Jonathan House, Dow Jones Newswires; +34-91-3958-121; [email protected]

(END) Dow Jones Newswires

January 17, 2008 11:31 ET (16:31 GMT)


Copyright 2008 Dow Jones & Company, Inc.

 

[surf4sports]

European govt bonds off daily lows as Bernanke confirms rate cuts to come

Thu, Jan 17 2008, 16:33 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - European government bonds bounced off daily lows after Federal Reserve Chairman Ben Bernanke once again suggested that interest rates will have to be cut aggressively in order to support US economic growth.

In a testimony before US lawmakers, Bernanke said "downside risks to growth have become more pronounced", that "additional policy easing may well be necessary", and that rate cuts may have to be "substantive".

"In short, the Fed will cut rates by a bigger 50 basis points at its meeting that concludes on Jan 30 and will cut rates again after that if the economic data continues to head south," said Paul Ashworth, economist at Capital Economics.

Bernanke's cautious view on growth was supported by a very weak Philadelphia Fed's manufacturing activity index, which fell to -20.9 in January from -1.6 in December and against expectations for a -1.3 reading. This brings it to levels seen only during a recession, with weak components in new orders, employment and shipments not boding well for future activity.

Earlier in the day, US housing starts data was also very weak, dropping 14.2 pct in December, although bond markets were at the same time weighed by an upbeat weekly jobless claims report.

In the UK, gilts fell, performing worse than the wider market, after a key Bank of England rate-setter stressed the inflationary pressures in the economy.

BoE Deputy Governor John Gieve expressed worry that inflation will remain "well above target in the coming months at a time when short-term inflation expectations remain uncomfortably high."

He said the monetary policy reaction would depend on second-round inflation effects, so that if oil and commodity prices caused higher consumer prices, the BoE would have to adjust its policy accordingly.

Although the comments pushed shorter-dated gilt prices sharply lower, many economists still believe the BoE will cut interest rates next month, particularly since Gieve has voted for rate cuts since November.

"(Gieve's) speech makes clear that the BoE cannot afford to take its eye off the inflation ball," said Howard Archer at Global Insight.

However, "he is clearly concerned that the disruption in global credit markets and in the UK banking system markedly increases the risk that the UK economy could suffer a deep and extended downturn," said Archer.

At Yield Change on

1610 GMT pct previous close

March euribor future (Liffe) 95.68 unchanged

June euribor future (Liffe) 95.90 dn 0.01

GERMANY

March bund future (Eurex) 116.12 dn 0.11

4.00 pct Jan 2018 govt bond 100.12 3.98 up 0.01

FRANCE

4.25 pct Oct 2017 govt bond 101.25 4.09 dn 0.04

ITALY

5.25 pct Feb 2018 govt bond 101.76 4.33 up 0.13

UK

March gilt future 111.12 dn 0.27

5.00 pct March 2018 govt bond 104.74 4.41 dn 0.25

March short sterling future 94.60 dn 0.08

June short sterling future 94.92 dn 0.09

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cp/cp/ajb

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[surf4sports]

Oil dips as US economic fears return to fore following Bernanke speech

Thu, Jan 17 2008, 16:37 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - Oil dipped in afternoon trade as fears that slowing US economic growth will curb demand spooked investors.

Oil, which has shed 3 usd a barrel since Monday, dropped to a day low of 90.26 usd after Federal Reserve chairman Ben Bernanke said the economic outlook for the year had worsened and that the US was likely to see below-trend growth "certainly in 2008, and probably early in 2009 as well".

However, the package of measures he pledged to stimulate the economy and the prospect of further rate cuts has gone some way to reassuring investors that a downturn might not be protracted, curbing losses.

"The focus in this market remains on any signs of an economic slowing that could further inflame fears of a possible US recession, (which) could shift to the emerging nations where demand has been little affected by high prices thus far," said Jim Ritterbusch, president of Ritterbusch & Associates.

At 4.16 pm, New York's WTI crude for February delivery was down 50 cents at 90.34 usd per barrel, nearly 10 usd off its all-time high above 100 usd hit in the first week of January.

Meanwhile London's Brent crude for March delivery was down 55 cents at 88.95 usd per barrel.

Oil traded higher earlier today as shorts covered after yesterday's losses, and as comments from Iranian oil minister Gholamhossein Nozari dampened speculation over the possibility of an imminent rise in OPEC crude production.

However, crude prices had lost 3 usd a barrel in the first three days of this week, pressured by rising stockpiles of crude, gasoline and distillates, and by fears over the US economy.

Faltering US demand amid fears the superpower is heading into recession is likely to be the primary factor pressuring prices lower in the course of the year, analysts said.

"All the aspects that underpinned crude prices in 2007 and at the start of this year are still here, with tight supplies, geopolitical fears on the supply side and the broad weakness in the greenback," said Sucden analyst Andrey Kryuchenkov.

"However, we fear that until global economic jitters and concerns over the US economy settle down, the trade is likely to remain volatile with less emphasis on actual supply fundamentals."

"In general, most commodities are likely to suffer if fears of an economic slowdown in the US intensify and we see more negative data from the world's top consumer," he added.

The International Energy Agency, which represents the interests of consumer countries, yesterday issued a cautious outlook for demand.

Although it kept its 2008 demand forecast unchanged, it trimmed its growth forecast by some 130,000 barrels per day and said it was keeping a close eye on US economic developments.

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har/ejp

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