A look at economic developments around the globe

AP News
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Posted: Feb 24, 2011 1:16 PM
A look at economic developments around the globe

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

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LONDON _ The violence in Libya dominated markets, sending stocks lower and oil prices higher.

Libya produces about 1.6 million barrels of crude per day and has the biggest oil reserves in Africa.

But the biggest worry in the markets is not necessarily Libya but whether the crisis spreads through the Persian Gulf.

In Europe, the FTSE 100 index of leading British shares closed down 0.1 percent, Germany's DAX fell 0.9 percent and the CAC-40 in Paris ended 0.1 percent lower.

Oil prices in New York hovered around $100 a barrel _ up about 20 percent in the past week _ while Brent crude in London rose nearly $3 to above $114.

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TOKYO _ Earlier in Asia, Japan's Nikkei 225 dropped 1.2 percent as the yen jumped on a safe-haven bid. A stronger yen hurts Japan's exports.

Hong Kong's Hang Seng index closed down 1.3 percent, Australia's S&P/ASX 200 shed 0.8 percent, South Korea's Kospi fell 0.6 percent and benchmarks in Singapore, New Zealand and India also declined.

China's main benchmark rose 0.6 percent.

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ROME _ Libya's violent upheaval has taken 1.2 million barrels of oil off the global market as energy plants and ports are shut down, according to Italy's Eni, the largest producer in Libya.

The figure represents most of Libya's total daily production, which before the crisis was about 1.6 million barrels of crude. The country sits on the biggest proven oil reserves in Africa.

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LONDON _ When Moammar Gadhafi told the world he was a changed man, some leaders were skeptical. Others, like Britain's Tony Blair, were quicker to see the benefits of rapprochement with the oil-rich nation.

Now, as Gadhafi's regime crumbles, questions are being raised about whether Britain, the United States, and others were too quick to embrace a volatile despot linked to terrorism and oppression as they sought lucrative business deals.

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BRUSSELS _ Russia's premier and the president of the EU's executive Commission clashed over EU plans to stop suppliers of oil or gas from also directly managing pipelines _ a move that threatens to hit Russian gas monopoly OAO Gazprom.

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BERLIN _ German government lawmakers are demanding that the eurozone's future bailout fund not be allowed to buy the bonds of troubled governments _ a veiled threat they might also block long-awaited changes to the current fund.

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CAIRO _ Egypt's stock exchange says an announcement about its reopening, already repeatedly delayed, will come next week. The Egyptian Exchange has been closed for nearly a month amid unrest surrounding Hosni Mubarak's ouster.

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BERLIN _ Germany's budget deficit was 3.3 percent of gross domestic product in 2010, lower than previously estimated and only just above the limit set by European Union rules.

An initial estimate in January was 3.5 percent. Germany last year exceeded the 3 percent limit set for members of the 17-nation eurozone for the first time in five years.

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LONDON _ Confidence over Europe's economic recovery improved further in February, another sign that the impact from the government debt crisis has for now abated.

The EU's executive branch said its economic sentiment indicator spiked by a point in the eurozone to 107.8, its highest level for nearly three and a half years.

Much of the survey was taken before this week's sharp rise in oil prices.

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LONDON _ The Royal Bank of Scotland, Britain's largest government-owned bank, reported a smaller net loss for 2010 after returning to profit in the final quarter of the year. RBS said its recovery from the crisis was ahead of schedule.

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JOHANNESBURG _ The launch of a state-owned mining company is renewing questions about whether South Africa has long-term plans to nationalize the lucrative industry.

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LONDON _ Moody's rating agency cut Cyprus' credit grade by two notches, citing worries about its banks' exposure to crisis-hit Greece, rising debt and a lack of economic competitiveness.

Moody's lowered its rating on Cypriot government bonds to A2 from Aa3 with a stable outlook, meaning no further downgrades are being considered.

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CAIRO _ Leading international ratings agency Standard & Poor's placed two Bahrain-based insurers on "CreditWatch Negative," citing the mass unrest that prompted the earlier downgrade of the Gulf nation's sovereign rating.