Consumer confidence falls
German consumer sentiment has been undermined by the eurozone debt crisis and fears of a new recession, falling to its lowest level since late last year, the GfK research institute said yesterday. GfK released its latest index of household confidence, forecasting 5.2 points next month, the lowest figure since November last year, a statement said. The institute also revised an estimate for this month down to 5.3 points from the initial figure of 5.4. Recent sharp drops on global stock markets, in addition to worries that the economy could begin to contract again have dealt a severe blow to the morale of German shoppers, the statement said.
France cuts GDP outlook
France scaled back its economic growth expectations on Wednesday and announced it will seek 11 billion euros (US$16 billion) in additional budget savings next year to ensure it stays on track with deficit targets. French Prime Minister Francois Fillon said the government has cut its outlook for next year’s GDP growth to 1.75 percent from 2.25 percent. It has also trimmed this year’s growth forecast to 1.75 percent from 2.0 percent. Explaining that debt mountains in the rich world were dragging on global growth, Fillon said the government will seek to impose a new 3 percent tax on annual revenues above 500,000 euros and modify a tax on real-estate capital gains as it tries to stick to a deficit target of 4.5 percent of GDP next year.
Glencore beats expectations
Swiss-based commodities giant Glencore International PLC has reported a first-half profit attributable to shareholders of US$2.47 billion. Analysts had predicted a profit of US$2.3 billion for the integrated trading company that extracts, ships and trades staples such as coal, corn and copper. The company posted a profit of US$1.08 billion during the first six months of last year. Glencore said its earnings before interest and tax reached US$3.3 billion in the first half, up from US$2.2 billion in the same period last year. Chief executive Ivan Glasenberg said yesterday that he foresees commodities prices remaining stable due to limited supply.
DP World’s profit leaps
Port operator DP World said yesterday its profit more than tripled in the first half of the year as trade increased and it booked a large gain by selling off much of its Australian business. Even without that one-time boost, the Dubai-based cargo handler said profit was up 36 percent. However, the world’s third-largest port operator cautioned that its forecast for the second half of this year — typically a stronger period for the industry — remains foggy amid concerns about a global slowdown. The company posted a first-half profit of US$740.9 million, up from US$219.2 million in the same period last year.
Diageo reports earnings
Diageo, the world’s biggest spirits group, set an ambitious 10 percent-plus growth target, when beating forecasts with a 16 percent rise in full-year earnings that lifted its shares. The British maker of Smirnoff vodka and Johnnie Walker whisky said yesterday it had not seen the effect of poor weather and weak consumer demand which undermined brewer Heineken. London-based Diageo posted underlying earnings of ￡0.836 per share, beating a Reuters Smart-Estimate of ￡0.789 and a company-compiled consensus of ￡0.791 for the year to June. The full-year dividend rose 6 percent to ￡0.404.