European stocks broadly lower ahead of earnings; Dax down 0.32%

Investing.com - European stocks were broadly lower on Tuesday, as markets were jittery ahead of upcoming earnings reports, although upbeat German trade data lent support, as well as comments made by European Central Bank Vice President Benoit Coeure over the weekend.

During European morning trade, the DJ Euro Stoxx 50 fell 0.24%, France’s CAC 40 edged down 0.15%, while Germany’s DAX slid 0.32%.

Official data earlier showed that Germay''s trade surplus widened to €18.8 billion in May, from €17.2 billion in April whose figure was revised down from a previously estimated €17.7 billion. Analysts had expected the trade surplus to narrow to €16.4 billion in May.

European equities found support on Monday after ECB Vice President Benoit Coeure said Sunday that rates will remain on hold for an extended period to ensure monetary stability in the euro zone.

The ECB left all rates on hold at its meeting last Thursday, after cutting rates to record lows in June in a bid to stave off the threat of persistently low inflation in the region.

Financial stocks were broadly lower, as French lenders Societe Generale (PARIS:SOGN) and BNP Paribas (PARIS:BNPP) retreated 0.48% and 0.85%, while Germany''s Deutsche Bank (XETRA:DBKGn) tumbled 1.29%.

Among peripheral lenders, Italy''s Intesa Sanpaolo (MILAN:ISP) and Unicredit (MILAN:CRDI) declined 0.81% and 0.82% respectively, while Spanish banks Banco Santander (MADRID:SAN) and BBVA (MADRID:BBVA) slid 0.31% and 0.81%.

Elsewhere, Air France-KLM (PARIS:AIRF) plunged 5.38% after the airline cut its full-year earnings forecast amid overcapacity on North American and Asian routes, poor demand for freight and the fallout from a dispute with Venezuela.

In London, FTSE 100 slipped 0.22%, weighed by losses in the financial sector.

Shares in Barclays (LONDON:BARC) dipped 0.06% and HSBC Holdings (LONDON:HSBA) edged down 0.18%, while the Royal Bank of Scotland (LONDON:RBS) dropped 0.88% and Lloyds Banking (LONDON:LLOY) lost 1.08%.

Meanwhile, mining stocks were mostly higher as Bhp Billiton (LONDON:BLT) rose 0.28% and Glencore Xstrata (LONDON:GLEN) jumped 1.05%, while Fresnillo (LONDON:FRES) and Rio Tinto (LONDON:RIO) saw shares rally 1.24% and 1.25% respectively.

Marks & Spencer (LONDON:MKS) added to gains, up 0.78%, after the clothing retailer said quarterly revenue at its food unit climbed 1.7%. The company also reported a 12th straight quarterly drop in non-food sales.

In the U.S., equity markets pointed to a steady to lower open. The Dow 30 futures pointed to a 0.07% loss, S&P 500 futuressignaled a 0.13% fall, while the Nasdaq 100 futures indicated a 0.03% dip.

Source:

www.jpost.com

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Cupcake Shop Crumbs Shuttering All Its Stores

rumbs says it is shuttering all its stores, a week after the struggling cupcake shop operator was delisted from the Nasdaq.

The New York City-based company said all employees were notified of the closures Monday. A representative for Crumbs could not immediately say how many workers were affected or how many stores it had remaining on its last day.

"Regrettably Crumbs has been forced to cease operations and is immediately attending to the dislocation of its employees while it evaluates its limited remaining options," the company said in an emailed statement. That will include filing for Chapter 7 bankruptcy liquidation.

A press release from its website in March listed 65 locations in 12 states and Washington, D.C. The website had not been updated with notification of the closures late Monday.

Crumbs was founded in 2003 and went public in 2011, selling giant cupcakes in flavors including Cookie Dough and Girl Scouts Thin Mints. More recently, however, it had been suffering from a steep decline in sales. For the three months ending March 31, Crumbs Bake Shop Inc. reported a loss of $3.8 million, steeper than the loss of $2 million from the same period a year ago.

The company had warned in a filing with the Securities and Exchange Commission this past May that it "may be forced to curtail or cease its activities" if its operations didn't generate enough cash flow.

As of the end of last year, Crumbs listed about 165 full-time employees and about 655 part-time hourly employees working in its stores.

Source:

abcnews.go.com

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Dollar falls against yen, Fed minutes in focus

A money changer holds stacks of US dollar notes in Jakarta, August 29, 2013.

The dollar weakened on Monday against the Japanese yen as investors continued to digest last week’s strong U.S. employment report and speculated about when the Federal Reserve is likely to begin raising U.S. interest rates.

The yen gained as long-dated U.S. Treasuries rallied, stemming a week-long bond selloff heading into Thursday's employment report, which showed nonfarm payrolls increased by 288,000 jobs last month and the unemployment rate fell to 6.1 percent from 6.3 percent in May.

The next major focus will be the release on Wednesday of minutes from the Fed’s June meeting, which will be scoured for signs about when central bank members see an interest rate increase as likely.

“The discussion won’t reflect the strong bounce in nonfarm payrolls, but will serve as a reference as to what the internal debate is in the FOMC regarding the first rate hike,” said Martin Schwerdtfeger, a foreign exchange strategist at TD Securities in Toronto.

Goldman Sachs economists on Monday brought forward their expectations of the first rate increase to the third quarter of 2015 from the first quarter of 2016, following similar actions from some other banks last week.

The dollar fell 0.27 percent against the yen to 101.84 yen, down from 102.10 yen late on Friday.

The dollar also slipped 0.01 percent against the euro to $1.3604. It had strengthened to $1.3577 earlier on Monday after data showed German industrial output fell 1.8 percent on the month in May, its biggest drop in more than two years.

The weak German data kept alive expectations the European Central Bank may need to loosen monetary policy further in coming months in the face of disinflationary pressures and subdued economic growth.

The dollar index, which tracks the greenback against a broad basket of currencies, was unchanged at 80.220, down from an earlier high of 80.359, the highest in a week-and-a-half.

Source:

www.reuters.com

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German industrial output posts surprise slump in May

Rolls of wire are seen at the plant of German steel company Arcelor Mittal in Duisburg April 19, 2013.

Germany's industrial output fell 1.8 percent on the month in May, its biggest drop in more than two years, as holiday days ate into working hours, construction slumped and geopolitics weighed, casting a shadow on its role as euro zone motor.

The drop was a surprise and sent the euro weaker - the consensus forecast in a Reuters poll was for industrial output to be unchanged. The economy ministry also slightly downwardly revised April data to -0.3 percent from a previous -0.2 percent.

The disappointing data added to mounting signs of a weaker second quarter in Europe's largest economy, after it enjoyed quarterly growth of 0.8 percent in the first three months of the year, its fastest growth rate in three years.

 

The figures also fanned expectations that the European Central Bank (ECB) may have to loosen monetary policy further in coming months in the face of disinflationary pressures and subdued growth.

"After a strong first quarter, industry output weakened over the last months. Besides the effect of the bridge (holiday) days in May and weakness in construction, which was to be expected after the mild winter, geopolitical factors may also have played a part," the ministry said in a statement.

"However sentiment indicators and general economic conditions suggests that output will rise again in the rest of the year after a weaker second quarter," it said.

The ministry did not specify which geopolitical areas were of concern but economists such as the influential Munich-based Ifo think-tank say business is worried about the Ukraine crisis and the impact on oil prices of the insurgency in Iraq.

"The second quarter is gradually turning into a massive disappointment. So far, May has brought disappointing retail sales, falling industry orders and now a significant fall in production," Dekabank economist Andreas Scheuerle said.

"Even if some of this is down to missing days at work because of the bridge days, and might be recovered later, there was simply not the momentum in the second quarter. That said, the general state of the German economy is not in question. The third quarter should be strong again," he said.

The German government forecasts growth of 1.8 percent for the year as a whole on the back of strong domestic demand and a healthy jobs market. However, expectations of a disappointing second quarter are now widespread.

"It is likely that German growth will at best come in flat in the second quarter, which suggests the other euro countries and the ECB should not pin their hopes on the German engine of growth for the time being," Commerzbank economists wrote in a research note.

Output in the construction sector fell 4.9 percent in May, after an exceptionally mild winter allowed much more building work to take place in the first months of the year. Output in intermediate goods slipped 3.0 percent on the quarter.

Source:

www.reuters.com

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German Industrial Output Falls in Sign of Slower Growth

German industrial output dropped for a third month in May amid signs Europe’s largest economy is taking a breather.

Production, adjusted for seasonal swings, fell 1.8 percent from April, when it declined a revised 0.3 percent, the Economy Ministry in Berlin said today. Economists forecast output to remain unchanged, according to the median of 35 estimates in a Bloomberg News survey. Production rose 1.3 percent in May from the previous year when adjusted for working days.

While Germany’s economic trend points “upward significantly,” growth probably slowed in the three months through June, the Bundesbank has said. Factory orders fell more than economists expected in May, Ifo business confidence dropped to a six-month low in June, and unemployment rose for a second month.

“There was a little dent in the second quarter,” said Jens-Oliver Niklasch, a fixed-income strategist at Landesbank Baden-Wuerttemberg in Stuttgart. “But generally speaking, the German economy is in quite good shape and there’s no reason for concern as growth rates will remain solid.”

Manufacturing fell 1.6 percent, with intermediate-goods production (GRIPIMOM) dropping 3 percent and consumer-goods output down 3.5 percent, today’s report showed. Investment-goods production rose 0.3 percent and energy output was up 1 percent, while construction slumped 4.9 percent.

Geopolitical Tensions

The economy ministry said the decline in output was primarily due to the timing of the May 1 holiday and should only be temporary.

“Sentiment indicators and the overall economic fundamentals suggest the upswing in industrial production will continue in the course of the year after a weaker second quarter,” the ministry said in a statement.

While Germany remains the driving force for the euro-area’s yet-lackluster recovery, recent data suggest that tensions between Russia and Ukraine are weighing on confidence and business prospects. Investor confidence as measured by the ZEW research institute dropped for a sixth month in June to the lowest level since December 2012.

The 18-nation euro-area economy grew just 0.2 percent at the beginning of the year, compared with an expansion of 0.8 percent in Germany, and the European Central Bank has warned that a prolonged period of low inflation could hamper the recovery.

Policy makers left interest rates unchanged last week and unveiled details of a new lending program aimed at boosting credit supply. Last month, they cut the benchmark rate to a record-low 0.15 percent, took the deposit rate below zero and said they’d intensify work on a purchase plan for asset-backed securities.

To contact the reporter on this story: Stefan Riecher in Frankfurt at sriecher@bloomberg.net

To contact the editors responsible for this story: Craig Stirling at cstirling1@bloomberg.net Jana Randow, Zoe Schneeweiss

Source:

www.bloomberg.com

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IBM Research Launches Project "Green Horizon" to Help China Deliver on Ambitious Energy and Environmental Goals

Agreement with Beijing government helps transform approaches to air quality management

BEIJING, July 7, 2014 /PRNewswire/ -- IBM (NYSE: IBM) has announced that it is deploying the full force of its researchers in laboratories around the world in a 10-year initiative to support China in transforming its national energy systems and protecting the health of citizens.

Dubbed "Green Horizon", the project sets out to leap beyond current global practices in three areas critical to China's sustainable growth: air quality management, renewable energy forecasting and energy optimization for industry. Led by IBM's China Research laboratory, the initiative will tap into the company's network of 12 global research labs and create an innovation ecosystem of partners from government, academia, industry and private enterprise.

One of the first partners to come on board is the Beijing Municipal Government. Through a collaboration agreement, the two parties have agreed to work together to develop solutions which can help tackle the city's air pollution challenges. The collaboration will leverage some of IBM's most advanced technologies such as cognitive computing, optical sensors and the internet of things all based on a Big Data and analytics platform and drawing on IBM's deep experience in weather prediction and climate modelling.

"China has made great achievements and contributed much to the world's economic growth over the past 30 years. It now has an opportunity to lead the world in sustainable energy and environmental management," said D.C. Chien, Chairman and CEO, IBM Greater China Group. "While other nations waited until their economies were fully developed before taking comprehensive action to address environmental issues, China can leverage IBM's most advanced information technologies to help transform its energy infrastructures in parallel with its growth."

China's economic growth over the past several decades has raised the living standards of hundreds of millions of Chinese citizens and led to China becoming the second largest economy in the world. However, the resulting environmental impact, particularly air pollution, has become a priority for the Chinese government and a matter of global importance.

According to Dr. Lu Qiang, Professor at Tsinghua University and Fellow of the Chinese Academy of Sciences, "the key to tackling environmental problems is not only monitoring emissions but adopting a comprehensive approach to air quality management and addressing the issues at their roots. Initiatives like IBM's Green Horizon can help by fostering joint innovation across the entire energy value chain."

Urban Air Quality Management Global urbanization is creating air quality challenges for all major cities around the world. In China, where cities have been the engines of much of the country's economic growth over the past decade, the government has launched the "Airborne Pollution Prevention and Control Action Plan" as it moves to safeguard the health of approximately 700 million people living in urban areas.

The city of Beijing will invest over $160 billion to improve air quality and deliver on its target of reducing harmful fine Particulate Matter (PM 2.5) particles by 25% by 2017. To support the initiative, IBM is partnering with the Beijing Municipal Government on a system to enable authorities to pinpoint the type, source and level of emissions and predict air quality in the city.

IBM's cognitive computing systems will analyze and learn from streams of real-time data generated by air quality monitoring stations, meteorological satellites and IBM's new-generation optical sensors - all connected by the internet of things. By applying supercomputing processing power, scientists from IBM and the Beijing Government aim to create visual maps showing the source and dispersion of pollutants across Beijing 72 hours in advance with street-scale resolution.

"As a leader in climate modelling, cognitive computing and predictive analytics, IBM Research can provide a lot of value to Beijing and other Chinese cities which are facing significant pressure to better monitor, respond to and address air pollution issues. Science based decision support systems, combined with sophisticated data analysis is exactly what the Chinese government needs to address the country's energy and environmental issues," said Tao Wang, Resident Scholar, Energy and Climate Program, Carnegie-Tsinghua Center for Global Policy.

With accurate, real-time data about Beijing's air quality, the government will be able to take rapid action to address environmental issues by adjusting production at specific factories or alerting citizens about developing air quality issues.

"The Chinese government is taking bold steps to transform the country's energy and environmental structures. IBM is here to help and through Green Horizon we are committed to deploying our most advanced technologies and best talent from around the world," said Dr. Xiaowei Shen, Director, IBM Research – China.

Renewable Energy Forecasting The Chinese government recently announced increased investment in solar, wind, hydro and biomass energy in a bid to decrease its dependency on fossil fuels. To support the objective, IBM has developed a renewable energy forecasting system to help energy grids harness and manage alternative energy sources.

The solution combines weather prediction and Big Data analytics to accurately forecast the availability of renewable energy which is renowned for its variability. It enables utility companies to forecast the amount of energy which will be available to be redirected into the grid or stored - helping to ensure that as little as possible is wasted. It increases the viability of renewable energy, helping the Chinese government to realize its objective of getting 13% of consumed energy from non-fossil fuels by 2017 and enabling the construction of the world's biggest renewable grids.

Based on IBM's "Hybrid Renewable Energy Forecasting" (HyRef) technology, the solution uses weather modeling capabilities, advanced cloud imaging technology and sky-facing cameras to track cloud movements, while sensors monitor wind speed, temperature and direction. It can predict the performance of individual renewable energy farms and estimate the amount of energy several days ahead.

The system has already been rolled out to 30 wind, solar and hydro power sources. The biggest deployment is at China's largest renewable energy initiative - the Zhangbei Demonstration Project managed by State Grid Jibei Electricity Power Company Limited (SG-JBEPC) in the Northern province of Hebei. Using the system, SG-JBEPC is able to integrate 10% more alternative energy (enough for 14,000 homes) into the national grid. With a prediction accuracy of 90% proven on Zhangbei's wind turbines, it is one of the most accurate energy forecasting systems in the world.

"Applying analytics and harnessing big data will allow utilities to tackle the intermittent nature of renewable energy and forecast power production from solar and wind, in a way that has never been done before," said Brad Gammons, General Manager IBM's Global Energy and Utilities Industry. "We have developed an intelligent system that combines weather and power forecasting to increase system availability and optimize power grid performance."

Energy Optimization for Industry China's economic growth over the past 10 years has led it to becoming the biggest energy consumer in the world. As part of the transformation of Chinese industry, the government has committed to reducing the country's "carbon intensity" by 40-45% by the year 2020, compared with 2005 levels (equivalent to 130 million tons of coal per year).

To support these goals, IBM is developing a new system to help monitor, manage and optimize the energy consumption of industrial enterprises – representing over 70% of China's total energy consumption.

Using a Big Data and analytics platform deployed over the cloud, it will analyze vast amounts of data generated by energy monitoring devices and identify opportunities for conservation. It could be used to analyze data from industrial enterprises in different cities and identify which sites and equipment waste the most energy. The system will be valuable for guiding decisions about optimization and investment in China's most power hungry industries such as steel, cement, chemical and non-ferrous metal. 

The new energy optimization system for industry leverages IBM's expertise in regional energy management in China. IBM is already engaged with China Southern Grid to manage the energy consumption of HengQin Island in Guangdong province helping the island to decrease energy consumption, costs and CO2 emissions.

About IBM in China IBM has been a partner to China's modernization program since the 1970s, providing computing systems and services to government, industry and scientific research. Today China is home to a number of world-class IBM laboratories and development centers including one of its twelve global research labs.

IBM Research - China was established in 1995 and today has labs in Beijing and Shanghai. IBM Research - China pursues a broad research agenda including cloud, big data analytics, cognitive computing and Internet-of-Things. IBM Research – China collaborates with partners from government, academia and industry to address key challenges across multiple sectors including energy and environment, logistics and supply chain, healthcare and financial services.

Source:

www.marketwatch.com

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American Apparel: Ousted CEO Dov Charney gears up for a power grab

Ousted American Apparel Chief Executive Dov Charney is firing up the machinery to retake control of the company that booted him nearly two weeks ago.

Charney plans to solicit the written consent from other stockholders to expand the number of board members to 15 from seven, elect new directors and amend company bylaws at a special shareholder meeting, according to a Tuesday filing with the Securities and Exchange Commission.

This is Charney's first indication that he intends to wage a "proxy fight," as it's known in corporate circles, by soliciting the right to vote other stockholders' shares in support of his position.

On Monday, Charney revealed that he had significantly upped his stake in the Los Angeles retailer to 43% from 27%. He spent $19.6 million to buy an additional 27.4 million shares last week, according to security filings.

Both American Apparel and Charney have engaged in a series of moves and countermoves since the board voted him out June 18. 

Charney's buying spree apparently came before American Apparel announced a shareholder rights plan on Saturday. The one-year poison pill plan is designed to keep Charney from regaining control of the retailer after he announced plans last week to buy more shares in the company. 

It is unclear whether Charney, the company's biggest shareholder, can call a special meeting of shareholders.

In his filing Tuesday, Charney states that the law in Delaware, where American Apparel is incorporated, allows him to take action to expand the board and install his own directors in the new positions without a special shareholders meeting if he is able to acquire the written consent of enough shareholders. Charney said he intends to seek such consent.

Over the weekend, a special committee of the board changed American Apparel's bylaws. The amended bylaws now prohibit executives or shareholders from calling special meetings, roughly doubles the time required to nominate directors and submit stockholder proposals at annual meetings and emphasized that board directors can be removed only "for cause." American Apparel said Monday that it had rejected Charney's request last week for a stockholder meeting. 

Regardless of the bylaws, analysts said that Charney's huge block of shares may force the board to sit down with him. Charney now has the power to block any big moves that the company may try to make, including a sale to an interested buyer. 

Charney bought his new shares on Friday after reaching a deal with New York investment firm Standard General. The cooperative buying arrangement stipulates that Standard General would buy American Apparel stock and then lend Charney the money to buy the stock from the firm at an annual interest rate of 10%, a security filing said. 

Late Monday, Standard General reported to the SEC that last week it had bought 27.4 million shares, which it sold to Charney on Friday. It bought an additional 1.5 million shares on Monday. 

The board voted to replace Charney as chairman and terminate him as CEO pending an investigation "into alleged misconduct." The vote resulted in Charney's immediate suspension, but under his employment contract, termination requires a 30-day delay.

The company has been working hard to counter attempts by Charney to get back his job. His lawyer, Patricia Glaser, filed an arbitration petition last week alleging wrongful termination, breach of contract and retaliation, among other issues.

Aside from its difficulties with Charney, American Apparel is struggling to overcome many hurdles.

The retailer has lost nearly $270 million in the last four years and is more than $200 million in debt. The company has warned that firing Charney could trigger defaults on nearly $40 million in loans and force it into bankruptcy.

One lender, Lion Capital, which owns 12% of American Apparel's stock, has demanded repayment on a $10-million loan this week, according to the New York Post. That could trigger another default on a $30-million loan with Capital One.

Allan Mayer, the retailer's co-chairman, said that the company had sufficient capital to pay off the loan if Lion asks to be repaid right away.

Source:

www.latimes.com

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