Stocks Lower in Japan, Germany, France and Britain

December 30, 2009

The dollar firmed 0.5% against the Canadian dollar, 0.3% relative to sterling, 0.2% versus the yen and 0.1% against the euro and Swiss franc.  The Aussie and New Zealand dollars are unchanged against the buck.  German and Japanese markets will not be open tomorrow.

Stocks fell 0.9% in Japan, 1.0% in Thailand, 0.3% in India and 0.2% in Australia.  The possibility that Japan Airlines may file for bankruptcy sent JAL shares tumbling over 25%.  China’s bourse bucked the trend, gaining 1.7%, but equities are lower by 0.8% in Germany, 0.7% in France and 0.5% in Britain.

Ten-year gilt, JGB, and bund yields are unchanged.

Gold stayed below $1100, easing 0.5% to $1092.50 per ounce.  Oil slid 0.2% to $78.74 per barrel.

European data released today accentuate the fragility of the region’s recovery.

  • The Conference Board Euroland index of leading economic indicators went up 0.7% in November, a slower pace than earlier this year and printed at a comparatively soft 101.7.  The coincident index slid 0.1% after losing 0.2% each in September and October.
  • Euroland loans to non-financial firms posted an on-year drop of 1.9% in November after declining 1.2% in October and 0.2% in September.  M3 was 0.2% below its year earlier level instead of 0.3% higher as forecast, and that money aggregate was merely 0.6% higher than a year before in September-November, down from a gain of 1.6% in August-October.
  • Euroland’s retail PMI of 50.3 in December was above 50 for the first time since May 2008 — but just barely.  The Italian component eased a full point to 50.7, and Germany’s was again below 50, signaling contraction at 47.8.  The French component remained over 50.
  • French housing starts in November were 14.7% lower than a year earlier.
  • Greek retail sales fell 14.0% on year in October, twice as much as the decline in September.
  • Finland retail sales were just 0.1% higher than a year earlier in November.
  • Czech industrial output was up just 0.2% from a year before in November.
  • Sweden’s trade surplus was 69% smaller in November than in October.  Exports were 7% lower than a year earlier.
  • French fiscal debt rose to 75.8% of GDP in the third quarter from 74% of GDP in 2Q.
  • The Swiss index of leading economic indicators improved 0.06 points to 1.68 in December, less than had been forecast.
  • The British Land Registry reported a 0.3% on-year drop in house prices.
  • Employment at large firms in Italy was 1.9% lower than a year earlier in October.
  • Spanish home prices fell by 0.9% and 7.0% from a year earlier in the third quarter.
  • Spain recorded a EUR 4.2 billion current account deficit in October.
  • Hungary posted a EUR 698 million current account surplus last quarter, 17 times greater than forecast, after EUR 475 million in 2Q09.
  • Italian producer prices were 3.5% lower than a year ago in November despite a 0.3% on-month increase.

Japan‘s government presented a long-term strategic plan calling for 2.0% per annum growth in the next decade.  That looks way too high.  However, Japan’s manufacturing PMI in December was robust at 53.8, 1.5 points higher than in November.  Export orders printed at 54.7, 2.5 points higher than in the prior month and showing no ill-effects from the firm yen.

Elsewhere in Asia, South Korean industrial output posted gains of 1.4% on month and 17.8% on year in November, and that nation’s index of leading economic indicators firmed to 12.5% in November.  China’s index of leading economic indicators went up to 106.29 from 105.82 in October.  Manufacturing output in Thailand was 8.9% higher than a year earlier in November, but capacity usage of 65.4% eased 0.9 percentage points compared to October.

In New Zealand, lending to households rose 0.2% and posted a 2.8% on-year advance, best in nine months.

No meaningful U.S. or Canadian data are scheduled today.

Copyright Larry Greenberg 2009.  All rights reserved.  No secondary distribution without express permission.

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