Economic Analysis and Indicators

High-risk day in Egypt. Demonstrations spread and clashes take place in downtown Cairo. The reported victim in the capital. Follow the news hour by hour. Arbor Networks has provided this graphic showing the data flow from Egypt, brutally interrupted today.

At the end of Friday prayers, the Egyptians are called to show for this "day of anger". They are demanding the departure of Mubarak. Internet was cut off while the first collisions take place at this very moment. Mohammed El Baradei is being withheld by police. The Guardian's special envoy discusses signs of fraternization with the demonstrators and police.

Since Tuesday, the clashes resulted in 7 deaths. Follow the events hour by hour on the site lexpress.fr

Wall Street ended Thursday on a very small increase, which places U.S. markets at a high of 29 months.

The Dow Jones finished with a rise of 0.04% or 4.39 points at 11,989.83 and the S & P 500 gained 0.22% (2.91 points) to 1299.54.

The Nasdaq meanwhile experienced the largest increase, with 0.58% or 15.78 points to 2755.28.

The good results published by several companies, including Caterpillar, supported the meeting, but the thresholds techniques could jeopardize short-term pursuit gains on Wall Street.

Indices have also welcomed the good results of Netflix, but those of Procter & Gamble and AT & T have been considered disappointing by contrast.

The S & P 500 is likely to meet a threshold of technical resistance around 1,300 points, as had been the case in August 2008.

Technical analysts also provide that the 12,000 points mark for the Dow Jones could trigger sales after eight weeks of gains.

Title Caterpillar rose 0.92% to 96.63 dollars. The manufacturer of construction machinery, author of the best performance of the Dow Jones in 2010, announced Thursday a quarterly profit above expectations.

The movie rental company Netflix has meanwhile surged 15.21% to 210.87 dollars, after the good results announced Wednesday after the closing.

Titles AT & T and Procter & Gamble has sold 2.09% respectively to 28.13% and 2.92 dollars to 64.18 dollars.Both groups announced a quarterly profit lower than last year.

The software developer Microsoft has announced its quarterly results shortly before the close, reporting a slight drop in profit but exceeded expectations.

The title took immediate 2%, before erasing its profits in the wake to finish the session up 0.31% to 28.87 dollars.

Conversely, the online retailer Amazon.com reported shortly after the end of a sales increase but below the consensus. Its title came from close up sharply from 5.17% to 184.45 dollars.

Since the beginning of the season results, the S & P 500 gained 2%, and 23.7% since September 1.Several technical data suggest that it would be overvalued.

"The market went through a great phase, and many people think it is oversized. I will not be surprised to see a correction of 8 to 10% in the next quarter," said Tom Schrader, an analyst at Stifel Nicolaus Capital Markets.

According to figures from Thomson Reuters, 71% of companies in the S & P 500 so far published their results last quarter beat the consensus.

Vivendi announced Wednesday it had sold its entire 20% stake in NBC Universal (NBCU) to the American General Electric, an operation that should allow the French to engage in the buyout of minority SFR.

In a statement, Vivendi said it sold to GE its remaining 12.34% in NBCU for $ 3.8 billion (2.77 billion euros).

The deal allows the French group of media and entertainment to pocket a total of 5.8 billion dollars (4.24 billion euros) on the sale of its 20% stake in NBCU.

This transaction was crucial to Vivendi.It was indeed the last lock before entering into discussions with Vodafone for the redemption of 44% in the UK telecoms operator SFR, estimated between 7 and 8 billion euros in cash.

Vivendi has made it a priority in recent months to repurchase the minority of its French SFR and Canal +, the pay-TV group in which Lagardere owns 20%. It hopes to reduce the conglomerate discount that weighs on its stock price because of its diverse holdings.

A Vivendi spokesman declined to say whether the group had begun negotiations with Vodafone.The UK operator has not wished to speak on the subject.

Vivendi, which also collected 1.25 billion euros in mid-January after the settlement of disputes in Poland should be able to buy out minority SFR and Canal +, while maintaining its credit ratings, which means that he could do without a capital increase, analysts said UBS in a note.

In an interview with Reuters in mid-January, the CEO of Vivendi, Jean-Bernard Levy had estimated that his group would have the means to carry out both operations.

"We think we could buy in satisfactory condition for Vivendi's stakes in SFR and Canal +, on the basis of our current balance sheet, without jeopardizing our credit rating and without recourse to the market," he explained.

At the Paris Stock Exchange, Vivendi shares gained 0.2% Wednesday mid-day while the media sector index rising 1.1%.

Debt crisis in the euro area, real estate in the U.S., inflationary pressures in emerging markets, market speculation, slowness of financial regulation: the clouds are gathering on the horizon, the IMF said. The ILO does not see him about a significant improvement on the job market and is concerned about the high level of youth unemployment. The IMF chief, Dominique Strauss-Kahn said at a conference here at Bercy in June 2010.

The International Monetary Fund raised its forecast Tuesday, January 25 for global growth in 2011 but has a long list of risks that accrue to the economy of the planet. After 5% growth in 2010, the planet is expected to grow by 4.4% this year. This is slightly better than forecast in October (4.2%).

The Washington Institute noted in particular its growth forecast for the United States.It now expects 3% (against 2.3% previously), by extending tax cuts in place since 2001 or 2003. If he praised the strength of consumption of Americans, he regretted "the considerable budgetary cost of the measure" and explained that the first global economy was still facing high unemployment, the fragility of household finances and slump in real estate.

The debt crisis in the eurozone should continue

For Europe, the forecasts remain largely unchanged: 1.5% in the euro zone, 1.6% in France, Germany 2.2% (against 2.0% previously). The crisis of debt is expected to continue, without destabilizing the rest of the world. These projections, the Fund said, "implies that policy measures are able to contain the current financial turmoil and its impact on the real economy to the periphery of the eurozone, weighing only a moderate weight on the global recovery."

"We need stronger growth in the U.S. and Europe" to create jobs, told AFP Olivier Blanchard, Director of Research Department of IMF, in conjunction with the presentation of the report. This growth of the economy "will stabilize the unemployment but not to reduce it. We need to plan beyond two years," he added. Over 10% of the workforce is unemployed in the euro area, its highest since the establishment of the zone in 1999. The United States have for their part never been so unemployment (9.4% in 2010) since the Great Depression. This rate should decrease to 9% in 2011, but still below the 5% before the global crisis, said Mr Blanchard.

Unemployment will remain at a record high level

The International Labour Office, which published its annual report Tuesday also, is not optimistic.The Geneva-based organization provides for zone "developed economies", which includes the United States and the European Union, a deterioration of employment in 2011 after two years already black. Global unemployment remains at record levels in 2010 with 205 million people affected worldwide. The unemployment rate was thus established in 2010 to 6.2% (against 6.3% in 2009). "2011 will most likely be the third consecutive year with a higher global unemployment to 200 million people," a record, explained Executive Director Employment Sector ILO, José Manuel Salazar-Xirinachs.

The biggest problem, according to the ILO, youth unemployment is already causing riots this year in Greece and more recently in Tunisia.The number of unemployed among the 15 to 24 years has certainly declined from 79.6 million in 2009 to 77,700,000 in 2010, a rate of 12.6%, recognizes the ILO, stressing, however, still well above the 73.5 million recorded in 2007, before the crisis.

Signs of overheating in emerging markets

The picture of a recovery, "two tier" remains unchanged when compared with the expected growth in 2011 in the major developing countries: 9.6% China 8.4% India 4.5% or Brazil. But for those countries, the IMF warns against possible runaway."In many emerging economies, activity remains strong, inflationary pressures appear, and there are now some signs of overheating, caused in part by large inflows of capital" or in some cases an undervalued currency, noted international institution, which recommends a "rapid assessment" of the Chinese currency, the yuan.

In the financial sphere, the Fund is concerned about "hot spots" in the stock market in Colombia and Mexico and to a lesser extent, Hong Kong, India and Peru. Banks in developed countries are vulnerable to rising public debt, says it well. If Greece, Ireland and other countries in the euro area should cause them heavy losses, he imagines the region falling into recession.

The institution is also concerned to see reform of financial regulation show signs of fatigue.The banks' balance sheet restructuring is ongoing and is progressing slowly, "deplores the Fund. The IMF will require "structural solutions to problems long term," such as excessive debt of some borrowers States, under-capitalization of certain institutions or vulnerability to reversals of capital markets.

The gross domestic product (GDP) of China is expected to grow 9.8% this year amid an inflation rate of 3.7%, reports the official China News Service quoted a think-tank advising the government.

The Institute for Economic Forecasting of the Academy of Sciences said that China's domestic demand should have more influence in the growth in 2011, adding that consumer prices should reach their peak during the first quarter.

In 2010, China's GDP grew by 10.3%.

SMEs that have embarked in an LBO in 2007-2008 will be confronétes a wall of debt, says David Lacombe, associate firm of administrators and teachers AJAssociés University Versailles Saint Quentin. French executives arrive at the business district of La Defense Firm Altares recently announced a 4.9% decline in corporate failures in 2010, how do you analyze this number?

The decline was expected after two years of course black in 2008 and 2009. We saw in the summer of 2010 a significant reduction in bankruptcy proceedings and liquidation. With a very substantial improvement in the situation of large companies. In 2009, 11 companies with more than 100 million euros of turnover have been placed in liquidation, against only 3 last year. With 58,700 bankruptcies last year, so it falls to 2007 levels.On paper, it is obviously good news but the factors of fragility are very numerous.

The success of the phenomenon of self-entrepreneur leaves he feared a surge in bankruptcies in the next two or three years?

This is the first factor of concern. Indeed last year, there were nearly 600 000 new firms, an increase of over 7% in one year. This boom is largely due to the growing success of the entrepreneur. Still, our experience teaches us that the "mortality rate" of companies during their first three years of existence is very strong. We therefore expect a surge in mechanically bankruptcies of very small structures in 2011, 2012 and 2013. Today 44% of procedures for businesses that have no employees.

You also mention the fragility of large SMEs who had launched proceedings LBO in the years 2006-2007?

This is my second topic concerns.Companies that have engaged in an LBO in the years 2006-2007 will have to repay their debt within three to come. They will be facing what I call the "wall of debt." But the business models underpinning these financial arrangements had not incorporated the economic crisis and growth has probably been less buoyant than expected. Hence the inability of some companies to meet their deadlines. This phenomenon will begin to be felt this year.

Final factor that could push bankruptcies on the rise, the end of proceedings deferred tax deadlines or social …

This is the last factor that could push bankruptcies on the rise. During the crisis, the tax authorities have granted to companies that suffered from severe liquidity crises of deadline extensions lasting between 24 and 36 months.I fear that such moratoria – which were needed – that have pushed back in time cash structural problems of some companies.

France has fallen relative to Germany in terms of competitiveness and will likely lead to differences that threaten the euro zone, according to a study conducted for the Department of Economics.

To counter this trend, the economic analysis firm Coe-Rexecode, who presented the study Thursday to Industry Minister Eric Besson, advocates a "pact" between government and trade unions and staff.

His tracks: take into account the imperative of competitiveness in any tax reform; allow wage negotiations-term labor employment in the business; Give greater importance to employment in the cyclical management; Focus more clearly the training effort and research on the coupling between research and industry and to quickly implement a strong measure of registration of industrial costs in France.

"The competitiveness of French territories experienced a real drop" and "without a quick end to this conflict, the underlying scenarios are of concern," Coe wrote, Rexecode.

"The persistence of this gap with a single currency would inevitably lead to a disparity in living standards between the two countries and could threaten ultimately, the cohesion of the euro area," the office of economic analysis.

Among the indicators highlighted in the study:

– French exports were equal to 55% of German exports in 1990 against only 40% today.

– France has lost its only comparative advantage: lower prices.

– Margins of French industry have been squeezed as companies have passed on their price as a part of the discrepancy in labor costs and supply.

The authors explain the difference in costs between France and Germany opposed labor policies, Germany has reformed its labor market and adopted a policy of competitiveness, while France was implementing a reduction in hours of work "uniform and costly. "

The measures taken recently in France (clusters, research tax credit and Grand borrowing) in the right direction but "will not stem the decline of French industry by 5 to 10 years," says the study.

Citigroup announced on Tuesday a quarterly profit of $ 1.3 billion (971 million), supported by lower credit losses, but this result was lower than expected due to lower NBI.

In early trade, the Citigroup abandoned 4.28% to 4.91 dollars on Wall Street.

The banking group has reported a net earnings per share (EPS) of 4 cents in the fourth quarter, which contrasts with the loss of 7.6 billion, or 33 cents a share, experienced a year ago.Analysts on average expected a quarterly EPS of 8 cents per share, according to Thomson Reuters consensus I / B / E / S.

The third U.S. bank has paid about $ 2.3 billion in provisions for bad loans, largely due to improved activity of a credit card she wants to separate.

But a sharp slowdown in its securities subsidiary and trading has sealed the net banking income, which fell 6% from the third quarter, taking account of changes in accounting methods, to $ 18.4 billion (13.75 billion euros).

By itself, the revenue bonds fell by 58% over the previous three months, while the same figure at JPMorgan Chase, another Wall Street banking giant, fell by only 7.9% over the period .

This poor result could worry investors, reassured by the temporarily fell less than expected by JPMorgan recorded before the burst of the results of other large U.S. banks Goldman Sachs on Wednesday, Thursday and Morgan Stanley Bank of America <BAC.N Friday.

"I think Citi would be more provisions for doubtful debts for free to boost its earnings.But ultimately, we need a real growth in net banking income to increase, we can not simply unlock stores, "said Matt McCormick, portfolio manager and banking analyst at Bahl & Gaynor.

This is the fourth consecutive quarterly profit recorded by Citigroup, which had been the subject of public assistance by 45 billion dollars during the financial crisis. It is also the first quarter in the green since the U.S. Treasury sold its remaining participation.

Virgin America has placed an order for the A320 with five billion dollars (based on list price) from Airbus, a contract that allows Airbus to surpass the 10,000 orders after forty years of existence.

The airline, in which Sir Richard Branson has a minority stake, becomes the first customer to pass the farm A320neo, new version of the aircraft the best-selling Airbus to fuel economy by 15%.

Richard Branson announced the order Monday in Toulouse, during the balance of 2010 made by Airbus has beaten Boeing in the battle over the commands between the two rivals.

The control of Virgin America, which covers 60 A320s, including 30 A320neo, is a confirmation of a memorandum of understanding announced at the Farnborough Air Show last summer.

Airbus announced last week an order of magnitude potentially historic placed by the Indian airline IndiGo, including on A320neo 150, but the contract has not yet been finalized.

Vivendi hopes to cash in the coming weeks the funds from the sale of its stake in NBC Universal (NBCU), which could trigger the opening of negotiations with Vodafone to buy its 44% of SFR, said Friday Jean-Bernard Levy told Reuters.

The group, which aims to buy out minority subsidiary SFR and Canal + France, expects to benefit in exchange for these operations and improve its flexibility, "said chief executive in a telephone interview.

"This course will simplify the group.I think it will lead to a reduction of the discount for 'holding' and it will therefore improve our strategic flexibility and our ability to develop, "he said.

For now, no discussion is underway with Vodafone, nor with Lagardere, which holds about him a minority stake in Canal + France, said Jean-Bernard Levy.

"We will have the opportunity to discuss the appropriate time with Vodafone and Lagardère (…) The discussions with Vodafone will intervene once the case with Comcast unwound," said the leader of the leading European media and entertainment terms of market capitalization.

"We hope this will in the coming weeks (…).That the payment of the balance of our interest in NBCU will trigger the steps we will make with Vodafone, "he said.

VIVENDI TO THE AVERAGE

Jean-Bernard Levy said that his group had the means to initiate these transactions to purchase minority to achieve its ambition to buy the assets of which French is the majority shareholder but he does not have total control.

"We think we could buy in satisfactory condition for Vivendi's stakes in SFR and Canal +, on the basis of our current balance sheet, without jeopardizing our credit rating and without recourse to the market," he said.

Vivendi, which is to collect $ 3.8 billion for the completion of the transaction between General Electric and Comcast, for NBCU, has also received 1.254 billion euros for the settlement of disputes in Poland.

Analysts have estimated that the French conglomerate will pay 7 to 8 billion euros to convince Vodafone to sell its 44% interest in SFR, and to ensure total control of a subsidiary generates strong cash flow.

But Vivendi could also use cash flow to buy out its minority stake to Lagardère in Canal + France.

The latter provides for now to sell its shares through an IPO scheduled for next spring, after failing to find an agreement with Vivendi on the sale of its 20%.

Vivendi shares closed up 1.0%, to 20.80 euros.

At the same time, the media sector index ended up 0.47%, while the telecom index was down 0.56%.