A look at economic developments around the globe

AP News
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Posted: Feb 22, 2011 1:14 PM
A look at economic developments around the globe

A look at economic developments and activity in major stock markets around the world Tuesday:

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CAIRO _ Egypt's stock exchange postponed its already long-delayed reopening until next week and markets in the Gulf Arab region posted their third consecutive day of declines as unrest in Libya and elsewhere in the region battered already fragile investor confidence in the Mideast.

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MILAN _ Two oil companies, including the biggest energy producer in Libya, suspended production in the country due to the deadly protests against the regime of Moammar Gadhafi. Oil prices jumped in New York.

Italy's Eni halted and Spain's Repsol-YPF halted operations. Eni puts out 244,000 barrels of gas and oil equivalent a day in Libya, about a quarter of the country's exports. Repsol produced 34,777 barrels in the country last year, about 3.8 percent of national output.

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TOKYO _ Moody's Investors Service sounded the latest alarm on Japan's massive debt, cutting the outlook on the country's credit rating as it questioned the government's power to enact reforms.

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NEW YORK _ Oil prices soared to the highest level in more than two years as violence spread in Libya and Moammar Gadhafi's grip weakened over the country. Only a small amount of Libya's oil production appear to have been affected, though analysts fear that revolts will spread to OPEC heavyweights like Iran.

Libya is the world's 18th largest oil producer, pumping out around 1.8 million barrels a day, or a little under 2 percent of global daily output. The OPEC country also sits atop the biggest oil reserves in the whole of Africa.

With so much uncertainty surrounding a large chunk of the world's daily oil production, market prices surged.

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LONDON _ Growing concerns over Libya's violent crisis weighed on stocks worldwide.

With deep rifts opening up in Moammar Gadhafi's regime, air force pilots defecting and a bloody crackdown in the capital of Tripoli, investors are fretting over how the crisis will end and what the impact on the North African country's oil production will be.

The jump in crude prices is a worry for investors. It reinforces fears of inflation and rising raw materials costs.

The FTSE 100 index of leading British shares closed down 0.3 percent, the CAC-40 in France dropped 1.2 percent and Germany's DAX ended less than 0.1 percent lower.

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TOKYO _ Earlier in Asia, the Nikkei 225 stock average dropped 1.8 percent, Hong Kong's Hang Seng lost 2.1 percent, South Korea's Kospi dropped 1.8 percent and China's benchmark Shanghai Composite Index fell 2.6 percent.

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CHRISTCHURCH, New Zealand _ At least 100 people were reportedly missing and believed buried after a powerful earthquake that killed at least 65 in one of New Zealand's largest cities.

The quake toppled the spire of the city's historic stone cathedral, flattened tall buildings and sent chunks of concrete and bricks hurtling onto cars, buses and pedestrians below.

The New Zealand dollar slid 1 percent against the dollar while the country's benchmark stock index fell 0.7 percent.

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BRUSSELS _ The European Central Bank warned that the eurozone needs much stricter rules on government borrowing and tighter oversight on spending by households and businesses.

The warning comes as the European Union and its member states haggle over how to improve the so-called Stability and Growth Pact, whose caps on budget deficits and debts were never strictly enforced in the years leading up to the debt crisis.

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BEIJING _ China's banks and other top state companies will be required to hand over more profit to the government as Beijing shifts resources to encouraging consumer spending and small businesses.

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CAIRO _ Saudi Arabia's oil minister says the oil powerhouse has ample spare capacity to offset any supply disruptions as unrest in Libya sent oil markets surging.

Saudi Arabia, the de facto leader of the Organization of the Petroleum Exporting Countries, currently produces around 8 million barrels per day.

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LONDON _ Standard & Poor's became the second credit rating agency in as many days to downgrade Libya as the country reels from days of violence, which has reportedly left over 200 people dead.

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ATHENS, Greece _ A general strike in Greece is set to disrupt flights and cripple public transport and other services on Wednesday. Unions are stepping up their opposition to austerity measures in the crisis-hit country.

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BRUSSELS _ The European Investment Bank said it needs more money to support a transition to democracy in Tunisia, Egypt and other countries in the Arab region. However, the increase it requested from the EU would only allow it to keep investments at their current level.

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JERUSALEM _ A senior Israeli official says Tehran's decision to send two naval vessels through the Suez Canal is part of an Iranian campaign to gain "hegemony and control" over the Middle East.

The warships sailed through the canal en route to Syria, the first time Iranian military vessels have sailed into the Mediterranean since the 1979 Islamic Revolution.

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SYDNEY _ Dream holiday destination Queensland has a new nightmare. The flood waters have receded, the cyclone's fury is long spent and the welcome mat is out again. But tourists are staying away in droves.

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CAIRO _ Egypt asked Britain for its support in seeking debt forgiveness from Europe in the latest push to boost an economy bruised by weeks of protests that toppled President Hosni Mubarak.

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DUBLIN _ Frustrated with the way Ireland's politicians have handled their nation's crippled economy, some economists here say it's time they had a role in the country's politics.

Experts from across the field of finance are competing in this week's Irish general election, marketing themselves as the economically literate alternative to politics as usual.

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BELGRADE, Serbia _ An IMF delegation approved the release of the last installment of a 2.9 billion euro ($3.96 billion) standby loan for Serbia, which has already asked for a new deal once the current one expires in April.

Serbia is trying to cope with job losses and threats of widespread strikes over low public sector salaries.