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

 

Wine: 20% Of Marlborough Storage Tanks Damaged By Quake

An estimated 20 percent of wine storage tanks in the Marlborough region, the country’s largest wine producing area, have been damaged by the impact of the recent Kaikoura earthquake. More>>

ALSO:

ACC: Levy Recommendations For 2017 – 2019 Period

• For car owners, a 13% reduction in the average Motor Vehicle levy • For businesses, a 10% reduction in the average Work levy, and changes to workplace safety incentive products • For employees, due to an increase in claims volumes and costs, a 3% increase in the Earners’ levy. More>>

Women's Affairs: Government Accepts Recommendations On Pay Equity

The Government will update the Equal Pay Act and amend the Employment Relations Act to implement recommendations of the Joint Working Group on Pay Equity. More>>

ALSO:

Immigration: Increase In Seasonal Workers For RSE

The current cap will be increased by 1,000 from 9,500 to 10,500 RSE workers for the 2016-17 season. Mr Woodhouse says the horticulture and viticulture industry is New Zealand’s fourth largest export industry, producing almost $5 billion in exports. More>>

ALSO:

Hurunui: Crown Irrigation Invests Up To $3.4m In North Canterbury

Crown Irrigation Investments will invest up to $3.4m in the Hurunui Water Project, an irrigation scheme that will be capable of irrigating up to 21,000 hectares on the south side of the Hurunui River in North Canterbury. More>>

ALSO:

Not So Great:Butterfly Eradication Success

The invasive pest great white butterfly has been eradicated from New Zealand in a world-first achievement, Primary Industries Minister Nathan Guy and Conservation Minister Maggie Barry say. More>>

Gordon Campbell: On The Government’s Tax Cuts Fixation

Long before the earthquake hit, the dodginess of the government tax cuts programnme was evident in the language of its packaging. It is being touted as a “tax cuts and family care” package... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news