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

 

While you were sleeping: Deutsch Bank disappoints

While you were sleeping: Deutsch Bank disappoints

Jan 21 (BusinessDesk) – Shares of Deutsche Bank sank, taking other regional bank shares lower too, after the company posted an unexpected loss, raising concern that more skeletons might be lurking in the European corporate earnings closet.

Shares of Deutsche Bank dropped 4.3 percent after the German lender also flagged that this year will provide “further challenges”.

“2013 was the second successive year in which we have invested in the bank’s future growth and in further strengthening our controls while addressing legacy issues. These factors impacted our financial results,” Deutsche Bank Co-Chief Executive Officer Jürgen Fitschen said in a statement.

“We expect 2014 to be a year of further challenges and disciplined implementation; however, we are confident of reaching our 2015 targets and delivering on our strategic vision for Deutsche Bank,” according to Fitschen.

Other bank shares in Europe also declined, with Commerzbank sliding 4.5 percent, Banco Popolare dropping 3.1 percent and Credit Suisse falling 2.5 percent.

“The banking sector is reacting to Deutsche Bank,” UBS analysts including Daniele Brupbacher wrote in a report to clients, according to Bloomberg News. “Some pullback and profit taking in the sector is to be expected.”

Overall, expectations are low for Europe’s corporate earnings this season.

Stoxx Europe 600 companies are expected to fall short of consensus estimates by 0.4 percent on revenues and by 0.9 percent on earnings, according to StarMine SmartEstimates, which focuses on the predictions by the most accurate analysts, Reuters reported.

Germany’s DAX fell 0.3 percent. Europe’s Stoxx 600 Index ended the day 0.1 percent down on the previous close, as did France’s CAC 40. The UK’s FTSE 100 rose 0.1 percent.

US markets were closed on Monday for the Martin Luther King holiday.

A report yesterday showed China’s economic growth eased in the final three months of 2013. The country’s gross domestic product climbed 7.7 percent in the fourth quarter from a year earlier, slowing from 7.8 percent in the third quarter. Industrial production gained 9.7 percent in December from a year earlier, less than the 10 percent increase in November.

Opinions were mixed on the Chinese data.

“Growth momentum is clearly weakening,” Dariusz Kowalczyk, senior economist and strategist at Credit Agricole CIB in Hong Kong, told Bloomberg News. “The slowdown became increasingly clear as the quarter progressed.” Expansion will decelerate this year, he added.

But it wasn’t all bad news.

"The economy may be a little more robust than people thought coming into 2014," Tim Condon, an economist at ING Group in Singapore, told Reuters. "I had thought the monetary tightening in 2013 would pose a downside risk. The numbers reduce that downside risk."

Investors will eye the International Monetary Fund’s latest outlook for the global economy, scheduled to be released on Tuesday. Further clues will come from the World Economic Forum which begins on Wednesday in Davos, Switzerland.

On Tuesday the Bank of Japan will start its two-day policy meeting.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Superu Report: Land Regulation Drives Auckland House Prices

Land use regulation is responsible for up to 56 per cent of the cost of an average house in Auckland according to a new research report quantifying the impact of land use regulations, Finance Minister Steven Joyce says. More>>

ALSO:

Fletcher Whittled: Fletcher Dumps Adamson In Face Of Dissatisfaction

Fletcher Building has taken the unusual step of dumping its chief executive, Mark Adamson, as the company slashed its full-year earnings guidance and flagged an impairment against Australian assets. More>>

ALSO:

No More Dog Docking: New Animal Welfare Regulations Progressed

“These 46 regulations include stock transport, farm husbandry, companion and working animals, pigs, layer hens and the way animals are accounted for in research, testing and teaching.” More>>

ALSO:

Employment: Most Kiwifruit Contractors Breaking Law

A Labour Inspectorate operation targeting the kiwifruit industry in Bay of Plenty has found the majority of labour hire contractors are breaching their obligations as employers. More>>

ALSO:

'Work Experience': Welfare Group Opposes The Warehouse Workfare

“This programme is about exploiting unemployed youth, not teaching them skills. The government are subsidising the Warehouse in the name of reducing benefit dependency,” says Vanessa Cole, spokesperson for Auckland Action Against Poverty. More>>

ALSO:

Internet Taxes: Labour To Target $600M In Unpaid Taxes From Multinationals

The Labour Party would target multinationals operating in New Zealand to ensure they don't avoid paying tax if it wins power and is targeting $600 million over three years through a "diverted profits tax," says leader Andrew Little. More>>

ALSO: