Major U.S. stock indices were mixed this week as more signs of a slowing global economy contrasted with optimism that European leaders were making headway on plans to manage the region's sovereign debt crisis.
U.S. and global economic news
Germany agrees to increase bailout contribution
Germany's parliament approved legislation to increase the eurozone bailout fund's lending capacity to 440 billion, from around 250 billion, and to make the fund more flexible. The move was lauded as the clearing of a major hurdle in the path to the containment of Europe's sovereign debt crisis. Also this week, the Greek Parliament approved a new property tax law in a closely watched vote, a key step in the country's efforts to secure further aid.
Standard & Poor's and Fitch downgrade New Zealand's debt
Standard & Poor's and Fitch Ratings downgraded New Zealand's local currency debt amid concern that government and household debt are expanding. New Zealand is the first Asia-Pacific nation in a decade to have its debt cut from AAA. S&P cut the local currency debt one level to AA+. Foreign currency debt was cut to AA from AA+.
Eurozone inflation hits three-year high
European inflation unexpectedly accelerated at the fastest pace in almost three years; the rate for September jumped to 3% from 2.5% in August. The increase further complicated the work of the European Central Bank as it fights to contain the region's debt crisis. Germany's inflation rate rose in September to 2.8%, from 2.5% in August.
Chinese manufacturing shrinks for third month
Chinese manufacturing shrank for the third month in a row as measures of new orders and export demand fell.
U.S. consumer spending, new home sales fall
U.S. consumer spending slowed in August as incomes unexpectedly dropped for the first time in almost two years; that drop forced households to dig into their savings. Purchases rose 0.2% after a 0.7% increase the previous month. Also in August, sales of new homes fell to a seasonally adjusted annual rate of 295,000, which was down from 302,000 a month earlier. The inventory of new homes fell to 162,000, the lowest level on record since 1963. In July U.S. home prices rose for a fourth month but remain lower than they were a year ago.
U.S. and global corporate news
Amazon debuts Kindle Fire
Amazon, the world's largest online retailer, debuted its e-reader Kindle Fire. The company is betting that its device, which is smaller and less than half the price of Apple's iPad, can present a challenge to that popular product.
BofA to charge for debit card use
Bank of America announced plans to charge customers $5 per month to use their debit cards. Other banks are expected to follow with similar moves, which are intended to make up for funds lost to a new regulation that puts a cap on how much banks can charge merchants for debit card transactions.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment