Italy Sells Maximum EU11 Billion of Bills

11 billion euros ($14.5 billion) of Treasury bills today, meeting its target, and borrowing costs plunged from the previous sale.
The Rome-based Treasury sold 8 billion euros of 182-day bills at 1.969 percent, the lowest since May and down from 3.251 percent at the last auction of similar-maturity securities on Dec. 28.

Investors bid for 1.35 times the amount offered, down from 1.69 times last month. The Treasury also sold 3 billion euros of 331-day bills at a rate of 2.214 percent.

“Bond auctions in Italy are no longer nerve-wracking affairs,” Nicholas Spiro, managing director of Spiro Sovereign Strategy in London, said by e-mail.

Greek Debt Wrangle May Pull Default Trigger

Opposition to payouts on Greek credit-default swaps from European Union policy makers is softening as disputes over a voluntary debt exchange threaten to push the nation into default.

Any agreement between the Greek government and the Washington-based Institute of International Finance on debt write downs will only bind 50 percent of investors in the 206 billion euros ($270 billion) of notes being negotiated, Barclay’s Capital estimates.

Hedge funds may resist a deal, seeking to get paid in full or compensated from insurance contracts.

U.S. Stock Futures Advance Before GDP Report

U.S. stock-index futures advanced, erasing earlier losses, as investors awaited a report that may show the world’s largest economy expanded in the fourth quarter at the fastest pace of 2011.

Starbucks Corp. dropped in Germany after reporting earnings.

Juniper Networks Inc. (JNPR) declined 8.7 percent in pre- market New York trading as it projected sales and profit that missed estimates.

Futures on the Standard & Poor’s 500 Index expiring in March rose 0.2 percent to 1,317.4 at 10:11 a.m. in London, rebounding from an earlier drop of as much as 0.3 percent.

Dollar edges up as Japan reports trade deficits

The dollar firmed slightly in Asian trade Wednesday as the yen slipped on official data showing Japan saw an annual trade deficit for the first time in more than 30 years.

But the greenback’s upside was limited as many exporters were still selling the US unit.

The dollar stood at 77.79 yen in mid-morning trade in Tokyo, edging up from 77.71 yen in New York Tuesday.

The euro was at $1.3024 and 101.31 yen, from $1.3030 and 101.25 yen in New York.

KSE index declines by 46 points on profit-booking

The Karachi Stock Exchange’s (KSE) benchmark index fell 46 points to below 12,000 points on profit-booking, mainly in fertiliser and energy stocks.

“Institutions opted to book profit in overbought stocks,” said Ahsan Mehanti, an analyst at Arif Habib Corporation, adding that the market had surged by about 1,000 points in the last few sessions.

The benchmark KSE 100-share index declined by 46.28 points, or 0.38 percent, to 11,991.38. The KSE 30-share index decreased by 39.98 points, or 0.36 percent, to 11,181.40.

European Stocks Decline on Ericsson, Novartis

European stocks fell for a second day after Ericsson AB and Novartis AG (NOVN) posted earnings that missed analysts’ estimates.

U.S. index futures retreated, while Asian shares climbed.

Ericsson, the world’s largest maker of wireless networks, plunged 14 percent after reporting fourth-quarter net income that missed analysts’ estimates.

Novartis, Europe’s biggest drugmaker by sales, declined 3.4 percent. ARM Holdings Plc (ARM) climbed 4.1 percent after Apple Inc.

posted quarterly profit that more than doubled.

The benchmark Stocks Europe 600 Index slipped 0.8 percent to 254.04 at 12:27 p.m. in London.

Economy in U.S. Preferred by Investors: Poll

Investors are turning increasingly bullish on U.S. markets as they declare its economy in better health than major rivals from Europe to Asia, according to Global Poll.

As the World Economic Forum’s annual meeting began today in Switzerland and Federal Reserve policy makers convene in Washington, 48 percent of respondents predict the U.S. will be among the world’s best-performing markets this year, according to the quarterly poll of 1,209 investors, analysts and traders who are subscribers that was conducted Jan. 23-24.

That’s the highest rating for the U.S. since the poll began in 2009 and it’s more than twice that of Brazil and China, the second-ranked markets.

U.K. Moves Closer to Recession as GDP Falls

The U.K. economy shrank more than economists forecast in the fourth quarter as manufacturers cut output and services stagnated, leaving Britain on the brink of another recession.

Gross domestic product fell 0.2 percent from the third quarter, when it increased 0.6 percent, the Office for National Statistics said in London today.

The median forecast of 33 forecasts in survey was for a drop of 0.1 percent.

Public-sector strikes over pensions on Nov. 30 had “some impact” on GDP in the quarter, the statistics office said.

Markets surge on Reserve Bank of India’s growth focus

Benchmark share indices ended at their 10-week closing highs on Tuesday, after the Reserve Bank of India’s decision to boost liquidity by lowering the cash reserve ratio would help revive growth.

The RBI in the third quarter review of Monetary Policy cut the Cash Reserve Ratio (CRR) by 50 bps to 5.5%.

CRR cut will infuse Rs 32,000 crore into the system.

However, repo and reverse repo have been kept unchanged at 8.5% and 7.5%, respectively.

RBI has kept Inflating forecast unchanged at 7%. GDP forecast has been brought down to 7% from 7.6% earlier.

Japan’s Fiscal Pressure Grows on Tax-Boost Plan

Japan’s government said it will probably miss its goal of balancing the budget by 2020 even with its proposed doubling of the sales tax, underscoring the scale of the nation’s fiscal challenges.

The primary budget deficit, which excludes the cost of servicing debt, will be the equivalent of 3.1 percent of gross domestic product for the year through March 2021, the Cabinet Office said in Tokyo today.

Hours after the release, Prime Minister Yoshihiko Noda reiterated his call for opposition lawmakers to engage in talks on boosting the sales levy.