Top Economics News

Tesco said Wednesday it would spend a billion pounds (1.2 billion) to overhaul its operations in Britain, where he seeks to regain market share, to re ESTABLISHING sales growth and to calm shareholders became nervous.

The emphasis on revitalizing sales implies that investments will be reduced to 3.3 billion pounds in the coming year against 3.8 billion last year.

The third global retailer also said its U.S. subsidiary successfully stalled later than expected.

Tesco dominates the segment of food retailing in Britain with a market share of 30% but in January it launched its first profit warning in 20 years. 

British retailer also announced a profit before tax of the group and exceptional up 1.6% to 3.9 billion pounds on the financial year ended February 25.

The consensus of analysts conducted by Tesco itself gave 3.88 billion, compared to 3.81 billion pounds for the year 2010/2011.

Operating earnings in Britain, where Tesco makes more than 70% of the balance, decreased 1% last quarter, while sales on a comparable basis fell 1.6%.

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STMicroelectronics (ST) announced Monday that an arbitral tribunal ordered it late last week to pay $ 59 million (45 million) to NXP Netherlands, leading manufacturer of semiconductors ; to lower its margin guidance for the first quarter.

"This award follows a dispute between ST and NXP that involved a claim by NXP for certain operating expenses to be added to the price of chips provided by NXP from 1 October 2008 and 31 December December 2009 to the joint venture created by ST in the field of mobile, "the company said in a statement.

"This award will be reflected in the income statement of our first quarter 2012 and we believe it will negatively impact our cost of sales. This will in turn have a negative impact on our gross margin by about 2.6%. "

ST adds thereby lower its pre ; cédente forecast results for the first quarter as a result of this unexpected exceptional charge, to about 30.4%

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Arnaud Lagardère, the General Partner of Lagardère, was sold for eight million shares of the group founded by his father Jean-Luc Lagardère.

According to advice published by the Financial Markets Authority (AMF), the shares were sold in five lots between 12 and 16 March. Arnaud Lagardère has sold 346,653 shares, representing 0.26% stake in media group.

Prior to these assignments, Arnaud Lagardere held directly and indirectly 9.62% of Lagardère, or 12,610,893 shares, as the group's annual report in late 2010.

These sales of securities came as the sovereign wealth fund Qatar Holding is mounted to the capital of Lagardère in its interest to 12.8% against 10% previously. The Qatari fund since December is the largest shareholder group.

"The sale of shares made these days on behalf of Mr. Lagardère held as part of the unwinding of a financing package set up by BNP Paribas in 2004 to opportunity of settling the estate of his father and under the relevant contract ", simply commented Lagardère in an email to the press.

"Mr. Lagardère has signed, as such, a term of disposals programmed, September 30, 2011 and including the AMF was informed," says the company. "The declarations of leadership assignments are made directly to the MFA by the operator."

Lagardère, which owns a 7.5% share in EADS, has suffered a heavy loss in 2011, 707 million euros due to massive writedowns past ; are about sports.

This diversification, considered strategic by Arnaud Lagardère, ended last year with an operating loss of six million euros, after sales performance below expectations, loss of several contracts and litigation.

Inflation rebounded 0.4% last month after falling in January. Blame the price of energy, those of fresh products and services.

The consumer prices fell by 0.4% in January in France, they bounce from 0.4% in February. This gives an inflation rate of 2.3% a year, said Tuesday the National Institute of Statistics and Economic Studies (INSEE). The indicator of underlying inflation, that is to say non-price (volatile petroleum products, fresh produce …) and administered prices (electricity, gas, tobacco …), however, has shown steady to 1.4% yoy.

In fact, the origin of the rebound in February lies partly in these volatile products. The pursuit of higher energy prices has thus resulted in an increase of 1% last month (7.8% yoy), in the wake of rising crude oil prices. This rise has affected the price of fuel (1.3% in February and 8.5% year on year) and those of liquid fuels (4.1%, 16.1%).

Fresh products also recorded a rise unevenly high (3.0% against 1.3% in February 2011; 0.2% yoy). These increases were particularly concerned vegetables (+8.7%). The particularly low temperatures have indeed affected the production and delivery of products.

Excluding fresh food, the food prices are increasing is only slightly (0.2%, 4.4% yoy). The price of spirits has continued to grow (1.9%, 5.8% yoy) and taxation of soft drinks has affected the prices of soft drinks, juices and syrups (0.9%, 8.5% on a year). Ultimately, food prices rose in February by 0.6% and 3.8% year on year.

Service prices are also victims of seasonal increases. Totaling an increase of 0.5% last month (1.6% yoy). With winter school holidays, accommodation holiday surged by 30.8% (5% yoy), while package holidays are appreciated by 9.8% (0.8%). Automobile insurance also rose by 2.6% (2.8% yoy), tolls and parking of 1.8% (2.5%), the Clean Water 0.8% ( 5.8%), distribution of 0.4% (2.8% yoy) and nursing homes by 0.3% (2.7%).

Prices of manufactured goods remained virtually unchanged, however (0.1%, 0.7% yoy). Excluding tobacco index of consumer prices rose in the same way from 0.4% in February (+2.2% yoy) and, seasonally adjusted, it rose 0.1% ( 2.3% yoy).

This decline

Conversely, price decreases were observed on the "other networks" (-2.9% -2.5% yoy) and telecom prices (-1.3% -7.6 % year on year).  

Among manufactured goods, clothing and shoes were flat (+1.7% yoy). Bedding rose 3.1% (7.7% yoy), perfume and beauty products by 0.6% (2.0%) and watches, jewelery, gold 1.7% (12.1%).

Promotions were the cause of the decline in new car prices (-1.4% +0.8% yoy). As for the price of pharmaceuticals, they fell again (-0.7% -1.7%) as those of Photographic and cinematographic equipment (-1.1% -13.9% yoy) and audio-visual (-0.5% -13.1% yoy).

Greece may need extra help and we can not exclude an enhanced firepower of the European Stability Mechanism (MES), the future permanent emergency fund in the euro area , says Austrian Chancellor Werner Faymann.

"I would not trust someone who would declare that (help) to Greece is sufficient," he says in an interview with the newspaper Österreich. "For Greece, it depends on their ability to comply with the measures (reform) across several elections."

The Chancellor did not rule out building a resource of MES, holding that it "may be necessary".

French President Nicolas Sarkozy confirmed Friday that a long-awaited decision on this matter would take place probably by the end of March and it was expected by then to "initiatives ".

In late February, France and Belgium said they agreed to enhance TSS with the ways of his predecessor, the European Financial Stability Fund (EFSF). 

The proposal would combine 250 billion still available within the EFSF with EUR 500 billion planned for the SS to create a financial firewall that can better fight against a contagious the debt crisis, but Germany still seems reluctant to the idea.

Faymann also believes that the EU should continue to support not only Greece, but Portugal, Italy and Spain.

"Let us not forget that our economy is strongly linked to that of Italy," argued the Austrian Chancellor, adding that Rome was in a better position than Athens.

The rating agency Standard and Poor's downgraded Monday the credit rating of Greece to "SD", a level corresponding to "selective default. Anti-austerity protesters in Parliament in Athens on 7 February 2012.

. The rating agency Standard and Poor's downgraded Monday the credit rating of Greece to "SD", a level corresponding to "selective default", to reflect the restructuring of government debt launched Friday. S & P said in a statement it plans to raise the rating of the country to CCC rating assigned to issuers of poor quality with a real risk of default, when this operation has been fully carried out, probably around mid- in March.

The decision of the U.S. Agency was expected since it had indicated in the past it would raise the note by Greece SD begin as soon as the implementation of the Agreement on Cessation of Athens claims made by private financial institutions. However, "if a sufficient number of bondholders (public) Greek did not accept the exchange offer," wrote S & P said in a statement, "we believe that Greece would present an imminent risk of default characterized payment "to the extent that the release of the rest of the assistance promised to the country by the euro area and the International Monetary Fund is subject to the successful debt restructuring of Athens.

A default is characterized reflected in the note "D" in the notation of S & P. "I take note of the decision" S & P, said the leader of Finance Ministers of the euro zone Jean-Claude Juncker, in a statement released in Luxembourg, adding that he expected a "strong participation "of private creditors in the operation launched Friday.

This exchange transaction should allow Greece to obtain a cancellation of debt of 107 billion euros. Greece aims to give private creditors participating in the operation of shares worth 53.5% less than those they currently hold. A quarter of those titles that creditors will receive bonds from the European Stability (EFSF), presumably with a maximum maturity of two years. The rest will consist of new Greek bonds with maturities ranging from 11 to 30 years, a period much greater than those they replace.

The goal is to push the repayment schedule of Greece on the amounts it still accepts honor, for giving him time to recover. If successful, "we should consider that the incident of the partial failure of Greece belongs to the past," wrote S & P, for which the possible increase of the rating to CCC would then account "the economic growth outlook uncertain of the country "and its" public debt remains strong ", even after restructuring.

Key values ​​to follow Friday on Wall Street.

* GAP has disappointed expectations Thursday, saying wait for fiscal 2012 earnings per share 1.75 to $ 1.80, while analysts polled by Thomson Reuters I / B / E / S on average had expected $ 1.79.

Gap posted a fourth quarter profit of $ 218 million, or 44 cents a share, against 365 million (60 cents) a year earlier.

In pre-market value fell by 2% to 23.10 dollars.

* AMERICAN INTERNATIONAL GROUP. The insurer reported a profit of $ 19.8 billion in the fourth quarter of 2011, due to an accounting change that allowed him to display a huge windfall.

This change, which raises the price of AIG from 6.5% to 29.81 dollars in pre-market means that the group will not pay tax on billions of dollars in profits in the coming years.

* Interpublic. The advertising agency has published a quarterly profit above expectations, thanks to emerging markets in a context of recovery of the sector.

EPS for the fourth quarter is 50 cents per share while the market was expecting 39 cents per share. Revenues for the quarter amounted to $ 2.07 billion, or less stable over one year. The turnover abroad rose by 6%.

In 2012, Interpublic expects organic growth of 3%.

In pre-market value gains 4.2% after finishing at 10.91 dollars Thursday.

* CITIGROUP. The bank has raised $ 1.95 billion sale of its stake in Indian company Housing Development Finance Corp, said on Friday, sources familiar with the matter.

In pre-market value gains 1% to 32.95 dollars.

PSA Peugeot Citroën is the star of the Paris stock exchange today. Its title flies by nearly 10%, boosted by the announcement of cooperation projects and a possible alliance with General Motors. A PSA Peugeot Citroën plant in Coventry, UK.

The title of French carmaker PSA Peugeot Citroen flew Wednesday morning at the Paris Bourse, boosted by the prospect of an alliance with General Motors. At 10:10 (9:10 GMT), the value gained 9.80% to 15.80 euros and largely occupied first place in the CAC 40, which lost 0.29%. Analysts at Natixis bank have in turn raised to "buy", against "neutral" before their recommendation on the title, with a price target to 20 euros.

The French manufacturer, sentencing, said review "projects of cooperation and alliances" about which "discussions are ongoing". The site reported Tuesday LaTribune.fr advanced negotiations for a marriage with General Motors. Labour Minister Xavier Bertrand confirmed Wednesday that French was in talks with the U.S.. Florent Couvreur, analyst at CM-CIC Securities, said that PSA is among the largest European manufacturers "most isolated" and that furthermore it is difficult to generate sufficient margins in its core automotive operations. The analyst also puts forward the fact that the company Opel, GM's European subsidiary, "is in the same situation."

Analysts at Bank of America-Merrill Lynch, "the first result of such discussions is the need for both companies to improve their position in Europe where all groups except two (Renault and Volkswagen) have recorded losses in the second half 2011 ". Thus, an alliance with PSA GM "could allow these two groups of strong synergies and economies of scale", such investments and R & D (research and development), for Mr. Slater. This merger would allow PSA to benefit from the GM position in Asia and the U.S. while the U.S. would have the opportunity through the French to build on small models, explains the analyst.

"GM-PSA could be the new Fiat-Chrysler", states Mr. Couvreur, while warning against a number of uncertainties. These include the future participation of the Peugeot family, the reaction of other PSA partners (Ford on diesel engines and Toyota in the "mini cars") and whether the alliance has held a probable reduction in overcapacity Europe. Analysts at the U.S. bank, however, wonder if this alliance fear materialize and warn that PSA longer needs this merger as GM, "given its dependence on Europe and its inability to cut costs fast enough ".

Greece does not return to growth until 2014, after four years of recession that have reduced the gross domestic product (GDP) by 17%, estimated Tuesday officials the European Union.

They added that Greece should cut another 150,000 jobs and reduce labor costs by 15% within three years.

"We believe that Greece will return to growth in 2014," said one of them to the press. "We expect a contraction of 4.5% this year and stagnate in 2013. This corresponds to a contraction of more than 17% over four years."

According to these officials, the Greek minimum wage is still higher than in Spain or Portugal. Labor costs increased by over 30% in Greece over the last decade, an unparalleled growth in the euro area, according to statistics from the European Union .

To reduce debt to 120% of GDP by 2020-in accordance with the agreement reached within the Eurogroup on the night of Monday to Tuesday, against 160% currently, Athens must raise 19 billion with 35 planned privatization from 2012 to 2014.

This amount is well below the anticipated 50 billion euros in the first bailout of 73 billion euros but it is included in the second. 

The year 2014 would be if Greece would record a primary budget surplus of 4.5% of GDP and where she could return to capital markets, officials said officials.

Unemployment will start to decline until 2014 and also its rate will be the order of 17% and 15% in 2015.

Officials from the euro area are studying how to delay parts of or the entire second level of aid to Greece, if possible until after the election pre views for April, it was learned Wednesday from European sources.

While the new aid package of € 130 billion is now almost ready, the finance ministers of the euro area are still not satisfied with the commitments of the Greek political leaders to implement the agreement, which realizes that Athens provides further budget cuts and introduce many unpopular reforms by 2014.

There are also doubts about the path of debt reduction Greek. It represents about 160% of Greek GDP and the "troika" consisting of the European Commission, the European Central Bank and International Monetary Fund would like to return to 120% of by 2020.

"There are proposals to delay the Greek package or cut into parts, so that immediate fault is avoided, but without commitment on the whole (package)" said one source.

"The options will be discussed (…) There is pressure from several countries to hold things until there is a concrete commitment in Greece, which could not come before the elections, "they added.

A telephone conference of finance ministers of the euro area must take place at 17:00.