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News : International Last Updated: Apr 24, 2009 - 5:31:05 PM


Markets News Afternoon: Slight rise in US home prices in February; Ryanair may close its base at Dusseldorf-Weeze
By Finfacts Team
Apr 22, 2009 - 4:49:10 PM

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In the most severe recession since World War II, the global economy is projected to shrink by 1.3 percent in 2009, with a slow recovery expected to take hold in 2010, according to the IMF’s April World Economic Outlook (WEO).

While the rate of contraction should moderate from the second quarter of 2009 onward, output per capita is projected to decline in countries representing three-quarters of the global economy. Growth is projected to reemerge in 2010, but at 1.9 percent it would be sluggish relative to past recoveries.

Finfacts Report:

IMF says Global Economy contracts in the most severe recession since World War II; Slow recovery in 2010

Bloomberg reports federal mortgage financier Freddie Mac Acting Chief Financial Officer David Kellermann, 41, was found dead early today in his home in the Washington suburbs, police said.

There were no signs of foul play, and the death is under investigation, Fairfax County, Virginia, Police Officer Shelley Broderick said. Broderick said early reports from others in the department indicated Kellermann’s wife reported a suicide, though the cause of death hasn’t been determined.

“He was a hard worker, good guy and had a positive attitude,” said David Stevens, a former Freddie mortgage executive who left the company in 2005 and was recently nominated to run the Federal Housing Administration.

“Either way, it’s a tragedy,” Stevens said, referring to the reports that the death may have been a suicide.

Investment bank Morgan Stanley today reported a first quarter net loss of $190 million, or 57 cents a share, compared with year-earlier net income of 1.43 billion, or $1.26 a share. The results also included a 33-cent tax gain.

 

Revenue fell 62% to $3.04 billion. The bank was hit by $1 billion in losses on real-estate investments.

In New York, investors overlooked poor earnings reports

The Dow Jones Industrial Average rose 59 points. The S&P 500 added 1% and the Nasdaq Composite Index rose 1.8%.

The Federal Housing Finance Agency (FHFA), which  regulates Fannie Mae, Freddie Mac, and the 12 Federal Home Loan Banks reported US home prices dropped 6.5% in February from a year earlier, the second-smallest decline in six months, signalling that  low mortgage rates may be boosting demand.

The fall was led by a 19% dip in the region that includes California, the most populous US. state, the FHFA said today. The agency's monthly house price index is down 9.5% from its peak in April 2007. Prices in February gained 0.7% from the previous month.

Live US Indices

In Europe, the Dow Jones Stoxx 600 rose 1.15% Wednesday.

UK Chancellor of the Exchequer Alistair Darling said in his Budget speech today, the UK will have to borrow a record £175bn   - - 12.4% of GDP - - as he admitted the economy faces its worst year since the Second World War.

He announced a new 50p top tax rate for those on £150,000 or above.

Finfacts Report:

UK Budget 2009: Chancellor says British economy to start growing again "towards the end of this year"; Borrowing to rise to 12.4% of GDP

The FTSE 100 rose 1.08%.

In Dublin, the ISEQ gained 2.50%.

CRH rose 1.31% and Elan climbed 5.2%.

Ryanair today confirmed that it will close its base at Dusseldorf-Weeze with the loss of 2.5m Passengers and 2,500 local jobs if the decision by the OVG Court in Munster to restrict the airport’s operating hours is not overturned.

Ryanair has today stopped accepting bookings on all flights affected by the change in the airport’s operating hours. The airline said it will review the Court’s decision with the Airport and its lawyers but confirmed that the base will close if the court decision to restrict operating hours is not overturned by Wednesday 29th April.

Ryanair currently operates 6 based aircraft at Dusseldorf –Weeze, which deliver 2.5m passengers p.a. and sustain 2,500 local jobs, most of which will be lost if Ryanair closes its base at the airport.

Ryanair’s Deputy Chief Executive, Michael Cawley, said:
“Ryanair and Dusseldorf-Weeze airport have been a huge success story for the entire region. We have grown our routes and passenger numbers rapidly but the OVG Court decision will result in the loss of 2,500 local jobs and Ryanair’s 2.5million passengers p.a. if this unworkable, unfair and unnecessary restriction to operating times is enforced.

“From today Ryanair will no longer be accepting bookings on affected flights to/from Dusseldorf-Weeze for travel after 2nd May. If the decision to restrict the airport is not overturned by Wednesday 29th April we will announce a plan to withdraw our base at Dusseldorf Weeze as it will be impossible to operate our schedule with these restrictions in place”.

Ryanair rose 2.85%.

European Benchmarks

Irish Share Prices

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Oil

On the New York Mercantile Exchange, oil for June delivery is trading at $48.37 down 18 cents from Tuesday's close. In London, Brent crude  for June delivery is trading at $49.52 a barrel down 30 cents.

Currencies

The euro is trading at $1.3019 and at £0.8974.

For live currency updates, check the right-hand column of the Finfacts home page.

The dollar traded at a record low $1.6038 per euro on July 15th.

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© Copyright 2009 by Finfacts.com

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