Weekly Financial News – Mar. 23/11

Equity investors appear to be shrugging off ongoing turmoil around the world as markets climb higher. News from Japan’s nuclear regulator this morning stated that there is a possibility that the failed nuclear plant’s reactor core may be cracked and leaking radiation. Cattle farmers in the region have been ordered to keep livestock from grazing on potentially contaminated pastures. In Europe, a renegotiation of the recent financing accord from the EU has somewhat deflated the European Union’s idea for a comprehensive anti-crisis strategy. Germany’s concerns over carrying the weight of debt strickened nations were heard and Angela Merkel’s demand to pare the startup capital for the emergency aid mechanism was heeded, lowering the fund’s paid in capital from 40 billion to 16 billion euros. Germany holds substantial weight in these discussions, and with Merkel’s party trailing in polls ahead of a March 27th election, the negotiations reflected the domestic political pressure being felt in Germany. In Libya, allies continue to bombard Gadhafi’s troops in an effort to put an end to the domestic military’s attack on its own people. Read More ….  Equities: The Stoxx Europe 600 is headed for its best week since September of last year as SAP climbs on the back of better-than-expected forecasts from Oracle and Accenture, and construction stocks move higher as the industry makes gains in Asia. Construction stocks are also driving markets in Asia higher on optimism for orders when Japan begins to rebuild. U.S. stock-index futures are up this morning the strong forecasts from Oracle and Accenture mentioned above, however, Research in Motion disappointed investors with Q1 comments after market close yesterday.

Commodities: Commodities are mostly higher this morning, in spite of the trade-weighed U.S dollar gaining some strength. Continuing conflict in Libya has oil sitting just below US$106 as investors remain concerned that ongoing turmoil in that region could cause more supply disruptions. Gold is also flirting with new all-time highs as adversity persists around the globe and silver is hovering around a 31-year high. Wheat and corn are up today on concerns that stockpiles could be too small to meet rising demand.

Source: Bloomberg


Market Snapshot

News Headlines RIM outlook signals ‘time of transition’ Research In Motion Ltd. is about to embark on a new chapter, but it’s off to a rocky start.  The Waterloo-based wireless device maker released its fiscal fourth-quarter results on Thursday, slightly beating analyst expectations.  (Globe and Mail)

HMV mulls sale of Canadian arm Struggling British music and books retailer HMV Group is looking into the possible sale of its Waterstone’s books chain and Canadian business as it seeks funds to secure its future.  (Globe and Mail)

Investors signal collapse of Lundin-Inmet plan Concerns are mounting that a merger between Lundin Mining Corp. and Inmet Mining Corp. is set to collapse owing to a dispute over a setback at a flagship Inmet project in Panama that is central to the deal.  (Globe and Mail)

Japan crisis threatens auto industry turnaround Shortages of critical Japanese-made components would shrink global automobile production by up to 40 per cent if idled plants in the country’s ravaged northeast fail to restart production by early May.  (Globe and Mail)

Another B.C. company jumps on LNG bandwagon The growing rush to export Canada’s natural gas bounty to energy-hungry Asian markets has drawn another player to the northwestern shores of British Columbia.  (Globe and Mail)

Bombardier gains China foothold for C Series sales Bombardier Inc. is tying the success of its C Series jet in the massive Chinese market to that country’s largest airplane maker, signing a deal that will help it attack the duopoly of Airbus and Boeing.  (Globe and Mail)

Federal Reserve gets less reserved April 27 has become a date certain to be indelibly circled on calendars of monetary-policy wonks across the United States. It will be a day that will rank among central banking’s most momentous. For on that day, Ben Bernanke, king among central bankers and steward of the world’s most powerful financial system, will actually hold a press conference.  (National Post)

Livent duo not ready to take bow Don’t expect convicted fraudster Garth Drabinsky to take a bow during opera star Placido Domingo’s upcoming performances in Toronto.  (National Post)

Japan’s debt problem The Japanese economy has been thrust into the spotlight in the past week, but David MacNicol was concerned about its outlook far before the devastating 9.0 magnitude earthquake hit.  (National Post)

Economic Data  

Source: Bloomberg

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