RTTNews - After notable losses on Friday, European stocks are likely to open on a subdued note Monday morning on concerns about a recovery in the U.S., the world's largest economy. Currently, U.S. stock futures are trading down over 1 percent on concerns that the recent rally may have run ahead of the improvement in the real economy.
The average asking price for a home in the United Kingdom retreated 2.2 percent in August compared to the previous month, according to property Web site Rightmove on Monday. That's down sharply from the 0.6 percent increase in July, when the average asking price was £227,864. On an annual basis, prices were down 3.1 percent, the same rate of decline as in the previous month. With no significant reports due to be released in Europe today, investors may track U.S. stocks for direction.
Not withstanding a recovery witnessed last week, Asian stocks saw an across-the-board sell-off on Monday after dampening U.S. consumer confidence data and a disappointing GDP report from Japan darkened the global economic outlook.
Official data from Japan for the June quarter indicated that the country is now out of its recession, having recorded a 0.9 percent growth over March quarter, but the growth fell short of expectations.
On Wall Street, the major U.S. averages shed around 1% each on Friday following the release of Reuters and the University of Michigan's preliminary report on consumer sentiment for the month of August, which showed that the consumer sentiment index unexpectedly decreased compared to the previous month. Coupled with disappointing retail sales figures released earlier in the week, the data indicated that the American consumer is still struggling, prompting the pullback by stocks.
However, data released later showed that U.S. industry ramped up production in July for the first time in nine months, led by auto makers on the back of the government's cash for clunkers program, which provides incentives to buy new cars. Separately, government reports showed that Hong Kong's economy emerged out of a year- long recession as it grew 3.3% in the three months to June after falling in four consecutive quarters.
Crude oil futures posted their biggest loss in more than two weeks on Friday amid energy demand concerns after a disappointing consumer sentiment report in the U.S. darkened the economic outlook. After declining to $67.51 per barrel, down $3.01 in New York trading on Friday, crude oil fell further to $66.63 a dollar in Asian trading on Monday.
In corporate news, the UK government on Friday pledged a £340 million ($562) loan to plane manufacturer Airbus for developing and launching the much awaited A350 aircraft into the market. The A350, when launched, will compete with Boeing' much-delayed 787 Dreamliner.
Switzerland's biggest bank UBS AG may disclose names of up to 5,000 secret Swiss accounts to the United States as part of the deal initialed last week by Switzerland and the U.S., weekly newspaper NZZ am Sonntag reported on Sunday.
German car makers Volkswagen AG and Porsche might merge in 2010 instead of 2011 as stated last week, reports said Sunday
British American Tobacco plc, the maker of Lucky Strike and Dunhill cigarettes, is planning to appoint Richard Burrows, a former governor of the Bank of Ireland, as its new chairman, reports suggest.
The former chief executive of Volkswagen, Bernd Pischetsrieder, is the favored candidate to head the supervisory board of German car-component maker Continental AG, Der Spiegel reported.
Separately, Spiegel said that German utility E.ON AG's Ruhrgas unit intends to sell its 20.28 percent stake in ultra-high voltage German power grid by the end of this year.
Fresnillo plc reported profit for the first six months of fiscal 2009 of $137.11 million, down from last year's $158.07 million. Earnings per share declined 21.4% to $0.169 from $0.215 last year.
Michael Page International plc said that its profit attributable to owners of parent for the six months ended June was £28.31 million compared to £58.85 million in the year-ago period.
Witan Investment Trust plc's half-year pre-tax loss narrowed to £8.77 million from £139.32 million a year earlier.
Shaftesbury plc, in its interim statement, said it continues to experience healthy demand for retail, restaurant and residential accommodation across its villages. The company also stated that it is continuing to meet or exceed its letting targets for its uses.
The European markets fell for the first time in three days on Friday, as investors worried that weak U.S. consumer confidence will slow the pace of recovery in the world's largest economy.
The FTSEurofirst 300 index of pan-European blue chips closed 0.81% lower, while the narrower DJ Stoxx 50 index fell 0.94%. Around Europe, the U.K.' FTSE 100 index slipped 0.87%, France's CAC 40 index fell 0.83% and Germany's DAX index dropped 1.70%.Economic sensitive banking stocks were among the worst losers.
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