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- NYSE Euronext/Deutsche Boerse Deal May Be in Jeopardy - 12 January 2012
- EU Queries CRA Impartiality - 7 July 2011
- A Brief History of Competition Law – Part 3 - 11 October 2010
- Wal-Mart Results Reveal Shaky Consumer Confidence - 24 may 2010
- Power of Credit Rating Agencies Questioned - 6 may 2010
- Corporate Results Drag Market Down, World Financial Crisis Summit May Restore Hope - 23 October 2008
- E.U. Agrees on Financial Crisis Plan of Action – Investors Advised Not to Panic-Sell - 13 October 2008
While a final decision has not been made yet, it has been reported that the European Union has strong reservations about giving the go-ahead to the NYSE Euronext/Deutsche Boerse. Sources in the know have revealed that European Union antitrust regulators have made a recommendation that the deal should not be finalized, citing concerns that this may result in a European monopoly in exchange-traded futures and options. While speculation is rife, the final say on whether the deal can proceed or not lies with the twenty-seven European Union commissioners. They are scheduled to meet on February 1, with their ruling expected on or before February 9.
There has long been controversy over the influence credit rating agencies have on stock markets, with European Union members expressing concern that credit ratings can sometimes be biased. This could become self-fulfilling prophecies by influencing decision making processes of investors. Back in May 2010, Greece's credit rating was downgraded to 'junk' by credit rating agencies, with both Spain and Portugal being downgraded to just above junk rating. The downgraded rating had an almost immediate impact on worldwide markets, with investors selling bonds that had been issued by the three countries in question, which in turn pushed up borrowing costs, resulting in the need to request European Union financed bailouts. There was even talk at the time of creating a European credit rating company, although many expressed concern that investors would question the credibility of a credit rating agency charged with the task of rating the countries that created it.
It was following WWI that other countries started to implement competition policies along the lines of those introduced by the United States. Competition regulators were formed to ensure that competition and antitrust policies and laws were adhered to. Following the 2nd World War, the Allies introduced regulations to break up cartels and monopolies that had formed during the war years. At the time, this was mainly aimed at Germany and Japan. In the case of Germany, it was feared that large industry cartels were manipulated in a manner that gave total economic control of the country to the Nazi regime. With Japan, big business was a hotbed of nepotism resulting in multi-industry conglomerates that controlled the Japanese economy. However, the surrender of both Germany and Japan to the Allied forces at the end of WWII allowed for tighter controls to be enforced, and these controls were based on the principle of those being used in the U.S.
While the state of the economy of a number of European Union countries continues to be a cause for concern, and the Euro continues to flounder, US stock market players will no doubt be turning their attention to their home ground as they face a flood of reports indicating the economic health of the United States in the coming week. Among the reports expected this week are key readings on labor, individual income, housing, consumer sentiment and spending trends, and the country’s GDP.
Following the downgrading of Greece's credit rating to junk earlier this week, as well as the downgrading of both Spain and Portugal, with speculation that Portugal is in the firing line for a further downgrading, the call for the creation of a European credit rating firm to balance out the US dominance of this function is gaining momentum. The credit rating reductions by US rating services such as Standard & Poor’s and Moody’s Investors Service, has had a severe impact on worldwide markets, with investors selling bonds issued by the three countries, in turn driving up their borrowing costs and increasing the need for bailouts financed by the European Union. Furthermore, the Euro dropped to a 13-month low, due primarily to concerns being raised over the ability of other European countries to meet their obligations without intervention.
While U.S. credit markets seem to be loosening up a little, investors have no respite from anxiety as the trickle of third quarter corporate results currently being released seems to be turning into a torrent of bad news. Fears of the country entering into a deep recession cannot be put to rest, especially in light of the fact that many corporate companies are trimming their fourth quarter earnings forecasts, indicating expectations of a bumpy road ahead. All major U.S. indexes dropped by more than 4 percent on Wednesday, with the Dow Jones industrial average ending the trading day with a loss of 514 points, or 5.69 percent, while the Standard & Poor’s 500 index dropped by 6.10 percent and the Nasdaq composite index fell by 4.77 percent.
While many investors and analysts agree that it is unlikely that the level of anxiety being experienced by global stock markets will decrease in the upcoming week, there are those who believe there is room for a bit of optimism, based on steps being taken by governments and central banks in the United States and across the Atlantic to assist the financial sector. Also, with many being of the opinion that the market in the U.S. will soon bottom out, bargain hunters may start buying, which would give stocks a much needed boost.
- Video: Five U.K. Banks Must Raise $21.2 Bln in New Capital
- Thursday 20 June 2013, 4:03 am - Video: Netherlands Aims to Exit Recession Later This Year
- Thursday 20 June 2013, 3:43 am - Video: Mordashov Says He's `Optimistic' on Steel Prices
- Thursday 20 June 2013, 3:05 am - Video: Publicis Looking at Acquisitions in China, India
- Thursday 20 June 2013, 2:39 am - Video: Dixons Profit Aided by Rivals' Exit, Sharper Prices
- Thursday 20 June 2013, 2:32 am - Video: PBOC May Ease Policy in Next Few Weeks
- Wednesday 19 June 2013, 9:36 pm
- Financial Sector No Longer Preferred Career Path for Graduates
- Thursday 30 may 2013 - Features - American Airlines/US Airways Merger Edges Forward
- Thursday 16 may 2013 - Markets - Facebook Has Positive First Quarter
- Thursday 2 may 2013 - News - Pre-Dispute Mandatory Arbitration Challenged
- Thursday 18 April 2013 - News - Solar Energy Surging Ahead as Alternative Energy Option
- Thursday 4 April 2013 - News - Foreclosed Homes Group Investment Booming
- Tuesday 19 March 2013 - News


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