Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


World Week Ahead: Italy votes, Bernanke speaks

World Week Ahead: Italy votes, Bernanke speaks

By Margreet Dietz

Feb. 25 (BusinessDesk) – Italian elections, another US budget deadline and Federal Reserve Chairman Ben Bernanke's testimony to Congress will form the focus of the coming week.

Bernanke's semi-annual update for US lawmakers on Tuesday and Wednesday will be closely watched after minutes from the latest Fed meeting sparked concern the central bank might ease or end its stimulus measures sooner than expected.

In the past week, shortened by a national holiday on Monday, the Standard & Poor's 500 Index gave up 0.3 percent and the Nasdaq Composite Index retreated almost 1 percent. The Dow Jones Industrial Average eked out a 0.1 percent gain. The S&P's slide ended seven consecutive weeks of gains.

Optimism prevails, however, as the latest earnings season provided evidence that corporate America by and large has managed to stay on track with an increased focus on the bottom line.

As a case in point, Hewlett Packard surprised investors with better-than-expected earnings and outlook. Its shares surged higher on Friday as at least eight analysts increased their target prices.

“The support for the market remains,” John Carey, fund manager with Boston-based Pioneer Investment Management, told Bloomberg News. “There’s been a fairly good stream of earnings. There’s certainly nothing to scare anyone.”

A potential threaten to consumers, however, are the US$85 billion in automatic federal spending cuts that are scheduled to take effect on March 1 unless Congress finds agreement to prevent them.

"It's at this point a political hot button in Washington but a very low level investor concern," Fred Dickson, chief market strategist at DA Davidson & Co in Lake Oswego, Oregon, told Reuters.

A slew of key economic data are scheduled for release in the coming days including consumer confidence, due Tuesday, and gross domestic product, due Thursday.

The Commerce Department will revise its estimate of fourth quarter GDP to 0.5 percent expansion from a 0.1 percent contraction, according to a Bloomberg survey of economists.

There are also reports on durable goods orders on Wednesday and the PMI manufacturing index on Friday.

The Treasury is scheduled to sell US$35 billion of two-year notes on Monday, the same amount of five-year debt on Tuesday and US$29 billion of seven-year bonds on Wednesday.

In Europe, the benchmark Stoxx 600 Index gained 0.4 percent for the week, as better-than-expected corporate earnings and confidence in Germany outweighed the European Commission's forecast that the euro-zone economy will contract for a second year in 2013.

Gross domestic product in the euro area will drop 0.3 percent this year, following a November forecast for a 0.1 percent expansion, the commission said on Friday. In keeping with ECB President Mario Draghi's optimism that the outlook is improving, the EC is forecasting a euro area expansion of 1.4 percent in 2014.

On Monday markets will get a chance to react to Moody's decision Friday night to downgrade the UK. The agency reduced its rating to Aa1 from Aaa, citing "continuing weakness in the UK's medium-term growth outlook" and its "high and rising debt burden." The outlook on the rating is now stable, Moody's said.

Investors also will be keeping a close eye on elections in Italy, with voters heading to the polls on Sunday and Monday. The latest polls showed front-runner Pier Luigi Bersani is unlikely to gain enough seats to govern without a coalition, according to Bloomberg.

A victory for former prime minister Silvio Berlusconi, who had been advancing in the polls in the last month, would be viewed as bad news for the country's willingness to tighten its national belt to meet euro zone budget deficit standards.

On Monday, Italy is also scheduled to auction up to 3 billion euros of bonds.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

R18: The Warehouse Group Praised For Removing Games

The decision by New Zealand’s largest retailer The Warehouse Group (TW Group), to withdraw stocks of the latest version of Grand Theft Auto V (GTA V) and other R18 games, has been praised by advocacy group Stop Demand Foundation. More>>

ALSO:

Air NZ Wine Awards: Victory For Villa Maria As Pinot Noir Thrills

It was a night to remember as Villa Maria Estate picked up one of the highest accolades of the evening, the O-I New Zealand Reserve Wine of the Show Trophy, at the 28th Air New Zealand Wine Awards. The Villa Maria Single Vineyard Southern Clays Marlborough ... More>>

ALSO:

Future Brighter Money: RBNZ Releases New Bank Note Designs

New Zealand’s banknotes are getting brighter and better, with the Reserve Bank today unveiling more vibrant and secure banknote designs which will progressively enter circulation later next year. More>>

ALSO:

Commerce: Supermarket Inquiry Finds No Breaches By Countdown

The Commerce Commission inquiry into anti-competitive behaviour by Countdown supermarkets, alleged by former Labour Party MP Shane Jones, has found nothing to warrant prosecution, although it warns supermarkets to take care in the way they communicate... More>>

ALSO:

Crown Accounts: English Flags ‘Challenge’ To Budget Surplus

Finance Minister Bill English is warning next month’s half yearly fiscal and economic update from the Treasury may not forecast a budget surplus, saying that returning the government’s accounts to surplus in 2015 will be “a challenge”, given the decline in commodity prices and weak global inflation. More>>

ALSO:

March 2015: Netflix To Launch In Australia And New Zealand

World’s Leading Internet Television Network to Offer Original Series, Movies, Documentaries, Stand-Up Comedy Specials and TV Shows for Low Monthly Price More>>

ALSO:

Price Of Cheese (Is Up): Dairy Product Prices Fall To Five-Year Low

Dairy product prices fell in the latest GlobalDairyTrade auction to the lowest level in more than five years, led by declines in rennet casein and skim milk powder. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news