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Visa gives big boost to Dow, but GDP doesn't excite
By Ryan Vlastelica NEW YORK (Reuters) - U.S. stocks mostly edged higher on Thursday, as a strong read on third-quarter economic growth raised new questions about monetary policy, while results at Visa single-handedly put the Dow in solidly higher territory. Gross domestic product grew at a 3.5 percent annual rate in the third quarter, beating expectations, though down from the 4.6 percent rate in the second quarter. The data came a day after the Federal Reserve ended its stimulative bond-buying program, leading investors to look to when the central bank will begin raising interest rates. ...
US economy grew 3.5% in third quarter
US economic growth was robust in the third quarter, according to the first government estimate Thursday, appearing to underscore the Federal Reserve's decision to end its asset-buying stimulus program. The world's largest economy expanded at an annual rate of 3.5 percent in the July-September period as defense spending surged and exports climbed, narrowing the trade gap, the Commerce Department said. The economy contracted 2.1 percent in the first quarter largely due to severe winter weather. "Growth above three percent in four of the past five quarters is starting to look like a trend," said Ian Shepherdson of Pantheon Macroeconomics.
South Africa's rand bounces back against a firm dollar
JOHANNESBURG (Reuters) - South Africa's rand firmed against the dollar on Thursday as the central bank defended its inflation targeting policy, saying it was the best approach to reducing price pressures while contending with slowing economic growth. The South African Reserve Bank's out-going governor Gill Marcus told a policy conference that the bank was unlikely to raise its inflation target from the current 3-6 percent band. The rand regained some of the ground lost overnight after a hawkish statement on interest rates by the U.S. central bank saw it flounder, and by 1509 GMT traded 0. ...
ECB says will launch asset purchase programme in Nov
The European Central Bank said on Thursday it will begin its purchases of asset-backed securities or ABS in November as part of a multi-pronged attack to kick-start credit in the euro area. In addition to a range of other measures, the ECB has drawn up an Asset-Backed Securities Purchase Programme (ABSPP) as "one of a number of measures ... to facilitate the provision of credit to the euro area economy." Asset-backed securities (ABS) are bundles of individual loans such as mortgages, auto credit and credit-card debt which are sold on to investors, allowing banks to share the risk of default and freeing up funds to offer more lending. The ECB believes that the market for such securities -- an important source of financing for banks to keep lending to small and medium-sized enterprises -- has effectively dried up since the financial crisis.
TSX drops as Goldcorp plunges on results, bullion selloff
By John Tilak TORONTO (Reuters) - Canada's main stock index was lower on Thursday as Goldcorp Inc dived after it reported disappointing quarterly results and got hit, along with other gold miners, by a drop in the bullion price fueled by positive U.S. economic data. Goldcorp shares tumbled nearly 9 percent to C$21.90 after the company?s results fell short of market expectations. Bullish comments about the U.S. economy on Wednesday from the U.S. Federal Reserve and data showing that U.S. gross domestic product grew at faster-than-expected rate in the third quarter weighed on bullion. ...
Spanish economy pulls ahead as eurozone stalls
Spain's economy expanded for the fifth straight quarter from July to September, official data showed on Thursday, holding to weak recovery from recession while the rest of the eurozone stalled. The country is pulling away from deep problems arising from a property crash and the eurozone debt crisis, and has enacted tough reforms against a background of high unemployment. Spanish gross domestic product grew by 0.5 percent in the third quarter from output in the previous quarter, according to initial figures from the national statistics institute. The Spanish economy, the eurozone's fourth biggest, has achieved modest but steady growth since emerging last year from its recession after the collapse of a property boom in 2008 that brought the country to the verge of default.
Dollar surges as Fed ends QE on hawkish note
By Jamie McGeever and Francesco Canepa LONDON (Reuters) - The dollar surged to a three-week high and global shares fell on Thursday as the Federal Reserve struck a confident note on the U.S. economy while the threat of deflation in the euro zone mounted. The Fed's announcement late on Wednesday that it was ending bond-buying after six years was widely expected, but its decision to drop a characterization of U.S. labor market slack as "significant" in the accompanying statement was not. ...
Ukraine's GDP shrinks 5.1 percent, beating expectations
Ukraine said its economy shrank by 5.1 percent on a 12-month basis in the third quarter, less than expected and signalling a pause in the war-torn country's accelerating economic decline. The government had warned earlier that this year the economy could shrink by nine percent because the separatist uprising that has gripped Ukraine's industrial east has effectively shut down industries responsible for nearly a quarter of the country's industrial output. Economy Minister Oleksandr Shalapak said this month that Ukraine's GDP reading for the third quarter may come in above expectations because of a relatively strong performance in September. Ukraine's economy recorded no growth last year and contracted by 0.2 percent in 2012.
German inflation stuck at 0.8% for fourth month in a row
Frankfurt (AFP) - Inflation in Germany, Europe's biggest economy, remained at the ultra-low level of 0.8 percent for the fourth month in October, initial data showed on Thursday against a background of eurozone deflation worries.
Zambia Treasury says no change in policy, urges markets to stay calm
LUSAKA (Reuters) - Zambia's economic policies remain unchanged and there is no need for market panic following the death of President Michael Sata this week, the finance ministry of Africa's second-biggest copper producer said on Thursday. "I wish to appeal to all economic players, to remain calm as they execute their business activities and to desist from speculative tendencies that may cause instability in our economy," Fredson Yamba, the top civil servant in the finance ministry, said in a statement.
Trade, defense spending buoy U.S. third-quarter growth
By Lucia Mutikani WASHINGTON (Reuters) - A smaller trade deficit and a surge in defense spending buoyed U.S. economic growth in the third quarter, but other details of Thursday's report hinted at some loss of momentum in activity. Gross domestic product grew at a 3.5 percent annual rate, the Commerce Department said on Thursday, beating economists' expectations for a 3.0 percent pace. While the pace of growth in business investment, housing and consumer spending slowed from the second quarter, all those categories contributed to growth. ...
Athens stock market down 3.6%, bank index plunges 7.3%
The Athens stock market fell 3.6 percent in trading on Thursday, with the banking index plunging 7.3 percent over concern about the state of the Greek economy. The stock market has been under pressure since three Greek banks were found to be short of capital on Sunday under stress tests of eurozone banks by the European Central Bank. Stock in Eurobank was down 7.14 percent and in National Bank of Greece 8.0 percent. Stock in Piraeus Bank was down 5.88 percent.
IMF advises Tanzania to keep public debt in check
DAR ES SALAAM (Reuters) - The International Monetary Fund said on Thursday that Tanzania is on track to reach its target for economic growth of about 7 percent this year, but warned the government to keep its public debt in check. Tanzania has stepped up domestic and external borrowing to finance infrastructure projects and plans to issue a debut Eurobond that could be worth up to $1 billion in fiscal year 2015/16. The IMF said it had agreed a cumulative external commercial borrowing ceiling of $2.4 billion with Tanzania for the period from July 2014 to June 2016. ...
German labour market holds its own in face of slowing economy
Unemployment in Germany, Europe's biggest economy, fell unexpectedly this month, as the labour market shrugged off cooling economic conditions all around, data showed on Thursday. The number of people registered as unemployed in Germany fell by a seasonally-adjusted 22,000 to 2.887 million in October, the Federal Labour Office said. The labour market usually picks up in the autumn as companies and businesses re-hire people following the summer holidays. Looking beyond that, however, the German labour market remains resilient, the office insisted.
Linde industrial gases cuts 2014 profit forecast
Linde, the German maker of industrial gases, on Thursday cut its profit forecast for the current year in face of slowing economic conditions in its key areas of business. Industrial gases are used in a wide range of activities, and notably in steelmaking. "We have to take account of the fact that economic growth has been much weaker than we all expected. In addition, future prospects for global economic trends have recently dulled," complained Linde chief executive Wolfgang Buechele.
Lufthansa lowers profit forecast for 2015
FRANKFURT, Germany (AP) ? German airline Deutsche Lufthansa AG has lowered its profit forecast for 2015 over concerns that the global economy may experience a downturn next year.
Spanish economy grows for 5th quarter in a row
MADRID (AP) ? Spain's economy grew by 0.5 percent in the third quarter compared with the previous three months, its fifth consecutive quarterly growth.
South Africa cbank's Marcus says CPI targets reduce price pressure
PRETORIA (Reuters) - South Africa's central bank defended its inflation targeting policy on Thursday, saying it had helped reduce price pressures and contributed to more favourable economic growth. Governor Gill Marcus, whose five year term in office will end on Nov. 8, told a conference on inflation targeting that raising its band from the current 3-6 percent would probably push CPI higher. ...
Lufthansa cuts 2015 forecast on global economic slowdown
Lufthansa, Europe's biggest airline, on Thursday cut its profit forecast for 2015 in face of the global economic slowdown. "When we look ahead, we can see that the economic slowdown and the continuing declines in our passenger yields in the face of fierce competition will affect our operating scope in the year ahead," said chief executive Carsten Spohr. Previously, Lufthansa had been pencilling in operating profit of around 2.0 billion euros ($2.5 billion) for next year and 1.0 billion euros for this year. Lufthansa said it expects to post operating profit of around 1.0 billion euros for the year, "excluding the impact of any further strike action between now and year-end."
Asia stocks fall, dollar surges on Fed's hawkish twist
By Shinichi Saoshiro TOKYO (Reuters) - Asian stocks were mostly lower and the dollar surged to a three-week high versus the yen after the U.S. Federal Reserve ended its massive quantitative easing programme, as expected, but laced its economic assessment with a tinge of hawkishness. Spreadbetters expected a more stable start for Europe, forecasting an effectively flat open for Britain's FTSE, Germany's DAX and France's CAC. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.6 percent. ...