10 Dec 2012: Japan sinks into recession

Markets

 

Equities

Indice

Latest

Day Change

S&P 500

1418

+ 0.29%

FTSE 100

5914

+ 0.22%

NSE (India)

5910

+ 0.05%

Nikkei 225

9523

– 0.04%

Shanghai Comp

2070

+ 0.44%

 

Debt

Security- 10 year

Latest

 Day Change

US Treasury

1.62%

– 0.01%

UK Gilts

1.75%

+ 0.01%

India G-sec

8.165%

– 0.09%

German Bunds

1.30%

+ 0.01%

 

Commodities

Commodity

Latest

Day Change

Gold (100 oz)

$1704

+ 0.01%

Copper (pound)

$3.67

+ 0.62%

Brent Crude

$107.60

+ 0.29%

 

Economy

Japan sinks into fresh recession: Japan slipped into a technical recession in 6 months to September making the need for financial stimulus urgent. GDP data on Monday showed that the output slipped by 0.9% in Q2 of this FY.

  • China’s trade suffers: Amid global fears, China’s trade has been suffering. November figures show a contraction in both exports and imports. In October this year, exports had shot up 11.4% YoY, but this figure has dropped to 2.9% in November. China’s trade surplus at $19.6 billion is its lowest in five months.

Companies

• US and UK to unveil failing bank plans: US and the UK will, for the first time, unveil cross-border regulations for failing global banks, outlining proposals to force shareholders and creditors to bear losses and to ensure that sufficient capital exists with the banks to protect the taxpayers.

News from India

  • Bank credit to be better in FY14: Credit growth is expected to be better in the next FY. With the economic growth also expected to pick up for FY14, it is being estimated the bank credit growth might touch 16-17%. Having said that, this development should mainly arise from growth prospects, as there won’t be any significant cut in interest rates.
  • Basel bonds flop in India: A lack of interest from investors is threatening the efforts of Indian banks to raise additional capital in order to comply with the tougher Basel III rules. The first round of capital raising flopped with many investors completely unaware of Basel bonds. With this, the banks might need to tighten their loan books, to have enough liquid capital.

 

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