Forex Technical Analytics

Daily Forex Technicals | Written by FOREX Ltd | Nov 10 09 09:15 GMT |

CHF The pre-planned break-out variant for sales has been implemented, but with loss in achievement of anticipated targets. OsMA trend indicator, having marked close parity of both parties activity, does not clarify the choice of planning priorities for today. Therefore, considering supposition of probable rate range movement, we can assume rate return to close 1,0100/20 levels, where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of a shorter time interval. As for short-term sales on condition of the formation of topping signals the targets will be 1,0040/60, 0,9980/1,0000 and (or) further break-out variant up to 0,9920/40, 0,9860/80, 0,9800/20. The alternative for buyers will be above 1,0240 with the targets of 1,0280/1,0300, 1,0340/60, 1,0400/20. GBP The pre-planned break-out variant for sales has been implemented, but with loss in several points in achievement of minimal anticipated target. OsMA trend indicator, having marked tendency of both party activity rise does not clarify the choice of planning priorities for today. Therefore, considering supposition of bearish cycle incompleteness we can assume probability of rate return to channel line 1 at 1,6680/1,6700 levels where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of a shorter time interval. As for short-term sales on condition of the formation of topping signals the targets will be 1,6620/40, 1,6540/60 and (or) further break-out variant up to 1,6480/1,6500, 1,6420/40, 1,6340/60. The alternative for buyers will be above 1,6760 with the targets of 1,6800/1,6820, 1,6880/1,6920. JPY The estimated test of key resistance range levels for implementation of the pre-planned short positions has not been confirmed, both party activity fall marked by OsMA trend indicator as the result of the trading day gives grounds to preserve trading plans designed before practically intact. Namely, we can assume probability or rate return to channel line 2 at 90,20/40 levels, where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of a shorter time interval. As for sales, on condition of the formation of topping signals the targets will be 89,60/80, 89,00/20 and (or) further break-out variant up to 88,40/60, 87,80/88,00. The alternative for buyers will be above 90,80 with the targets of 91,20/40, 91,80/92,00. EUR The pre-planned break-out variant for buyers has been implemented with achievement of minimal anticipated target. OsMA trend indicator, having marked in the bigger picture the preservation of bullish party activity, gives grounds to pre4serve buying position priority for today. Therefore, considering current cycle of bearish activity according to OsMA trend indicator, we can assume probability of rate return to close 1,4920/40 supports, where it is recommended to evaluate the development of the activity of both parties in accordance with the charts of a shorter time interval. As for short-term buying positions on condition of the formation of topping signals the targets will be 1,4980/1,5000, 1,5040/60 and (or) further break-out variant up to 1,5100/20, 1,5160/80, 1,5220/40. The alternative for sales will be below 1,4880 with the targets of 1,4820/40, 1,4760/80. FOREX Ltd www.forexltd.co.uk

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United Kingdom Trade Gap Widens From Higher Imports

Daily Forex Fundamentals | Written by ecPulse.com | Nov 10 09 09:58 GMT |

Today, we see that the trade balance in the United Kingdom revealed a widened deficit, and this is a result of improved domestic demand despite the ongoing recession that ravaged economies around the world and left high unemployment rates around the globe. Visible trade balance for September revealed a widened deficit to 7194 million pounds from 6240 million pounds while the markets were projecting a narrowed deficit to 6100 million pounds. Total exported goods in September increased to 19,413 million pounds from 18,679 while total imported goods climbed to 26,607 million pounds from 24,752 million pounds. The trade gap widened the most since eight months as a result of higher imports of cars and this was a surprise to markets since they have been assuming that the weak pound should have boosted exports further. Trade balance non-European also faced a widened trade deficit to 3783 million pounds from 3046 million pounds which is worse than the forecasted deficit of 3000 million pounds. Total trade balance also for September expanded to 3469 million pounds worse than the projected and previous trade deficits of 2200 and 2318 million pounds respectively. Ecpulse disclaimer: The content of ecPulse.com and any page in the website contain information for investors/traders and is not a recommendation to buy or sell currencies, stocks, gold, silver & energies, nor an offer to buy or sell currencies, stocks, gold, silver & energies. The information provided reflects the writers' opinions that deemed reliable but is not guaranteed as to accuracy or completeness. ecPulse is not liable for any losses or damages, monetary or otherwise that result. I recommend that anyone trades currencies, stocks, gold, silver & energies should do so with caution and consult with a broker before doing so. Prior performance may not be indicative of future performance. Currencies, stocks gold, silver &energies presented should be considered speculative with a high degree of volatility and risk

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Comments From Fitch Halts Sterling Rise

Daily Forex Fundamentals | Written by AC-Markets | Nov 10 09 09:45 GMT |

News and Events: With three of the world's largest central banks reassuring the markets that accumulation of risk is secure, it seems like clear sailing ahead for high beta currencies. In no uncertain terms last week the Fed and ECB indicated that they would support growth, stated that inflation is a far distinct concern and it was too early to signal any exit from their ultra loose monetary policy. While over the weekend the G20 policymakers put their negligible stamp of approval on this policy direction (while not commenting on serious imbalance caused by currency manipulation). General measures of risk aversion are currently at levels not seen since pre Lehman's, while indirect barometers of global growth such as the Baltic dry index continue to push higher. After a short lived test of the US economic data / risk appetite relationship on Friday, markets have been moving lock –n-step. Yesterday, Wall Street was broadly higher with the S&P up 2.22% (Dow Jones making a new 2009 high), while today's Asia regional indexes are higher across the board. DXY continues to push toward the 75.00 handle as the lack of policy shift from the central banks has given USD carry traders the green light. The EURUSD climbed to 1.5020 before falling back slightly. The JPY was also under significant pressure against everything but the USD. The AUDJPY climbed to 83.88, while the GBPUSD traded up to 151.68. Despite the gains in risk correlated trade, BRC retail sales printed up 3.8% m/m in October and RICS House Prices were up 34% vs. 28% exp., the Sterling has struggled in comparison to other currencies. First was the news that Kraft's latest bid for Cadbury Plc contained no increase as some expected and was flatly rejected. Early this morning, the UK and the GBP took a big hit when Fitch's David Riley was quoted as saying the UK is most at risk of losing (of the four large AAA sovereign debt issuers US, Germany, UK, France, ) its AAA sovereign status due to the fact it will need 'the largest budget adjustment.' The GBPUSD collapsed to 1.6603 from 1.6775. However, we expect the comments to fade as markets continue to embrace risk correlated trades. With a light economic calendar today, the market will be watching the German ZEW release. After yesterday's strong German IPC number and weak French numbers today, this historically unreliable indicator will be the only near term guidance participants will have to the state of the Eurozone economy. Today Key Issues: 08:30 SEK Industrial production, % m/m Sep 0.5 exp 09:30 GBP Trade balance, £ bn Sep -6.1 exp, -6.2 prior 10:00 EUR Germany: ZEW economic expectations index Nov 55.0 exp, 56.0 prior 14:15 USD Atlanta Fed President Lockhart (FOMC voter) speaks 15:00 USD San Francisco Fed President Yellen (FOMC voter) speaks 15:45 EUR ECB Executive Board member Gonzalez-Paramo speaks 16:15 USD Boston Fed President Rosengren (FOMC non-voter) speaks 16:30 NOK Norges Bank Deputy Governor Qvigstad speaks 23:50 JPY Core machinery orders, % m/m Sep 4.1 exp, 0.5 prior The Risk Today: EurUsd The breakout of the short term downtrend at 1.4930 / 50 and subsequent strong rally at the start of the mondays Asian session above those levels means the medium term uptrend looks to be back in play. The last hope for EURUSD bears that this move is merely a retracement of the 1.5060-1.4625 move seems to be under threat as the pair teeters around/above 1.4970 (which represents 78.6% fibonacci retracement). The pair should find support around 1.4915, and thereafter 1.4815, whilst resistance lies above at 1.5063 (26 Oct high), and 1.5100, with stops behind. GbpUsd Comments from Fitch offset positive UK data and temporally halted the sterling rise. Focus now returns to its 1.7041 year-to-date high, with 1.6740 now providing decent resistance. RSI still not quite at overbought levels (60 last) so bullish momentum has further room to go. UsdJpy USDJPY still consolidating in its symmetrical triangle; one of the least exciting pairs in this current move. So far pair has bottomed at 89.68 today, but risk appetite and subsequent demand for JPY-crosses rejected a further move to the downside. Expect support to come in again around 89.60 levels and 89.17 below there, whilst first resistance waits at 90.75. UsdChf USD slide has prompted USDCHF to breach near-term uptrend and downside support in 1.0132 region, and now looks to target 1.0037 ahead of parity. Resistance above comes in at 1.0200 and thereafter 1.0290. EURUSD GBPUSD USDJPY USDCHF 1.5100 1.7400 93.50 93.50 1.5063 1.7041 92.50 92.50 1.5000 1.6900 90.75 90.75 1.4991 1.6655 89.84 89.84 1.4910 1.6400 89.60 89.60 1.4810 1.6260 89.20 89.20 1.4626 1.6200 88.85 88.85 S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot ACM FOREX Disclaimer: This report has been prepared by AC Markets (thereof ACM) and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Salesperson or Traders of ACM at any given time. ACM is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.

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Forex and Dow Jones Recommended Levels

Daily Forex Technicals | Written by FXtechtrade | Nov 10 09 09:19 GMT |

EUR/USD Today's support: - 1.4929(main), where correction is possible. Break would give 1.4892, where correction also may be. Then follows 1.4864. Break of the latter would result in 1.4845. If a strong impulse, we would see 1.4827. Continuation will give 1.4802. Today's resistance: - 1.5038 and 1.5055(main). Break would give 1.5076, where a correction is possible. Then goes 1.5118. Break of the latter would result in 1.5140. If a strong impulse, we'd see 1.5168. Continuation will give 1.5184 and 1.5207. USD/JPY Today's support: - 89.33(main). Break would bring 89.12, where correction is possible. Then 88.78, where a correction may also happen. Break of the latter will give 88.52. If a strong impulse, we would see 88.21. Continuation would give 88.03 and 87.77. Today's resistance: - 90.58, 90.79, 90.97 and 91.42(main), where a correction may happen. Break would bring 91.80, where also a correction may be. Then 92.07. If a strong impulse, we would see 92.28. Continuation will give 92.44. DOW JONES INDEX Today's support: - 10119.38 and 10068.72(main), where a delay and correction may happen. Break of the latter will give 10040.57, where correction also can be. Then follows 10016.12. Be there a strong impulse, we would see 9987.19. Continuation will bring 9954.84 and 9934.00. Today's resistance: - 10242.11 and 10262.62(main), where a delay and correction may happen. Break would bring 10297.75, where a correction may happen. Then follows 10316.24, where a delay and correction could also be. Be there a strong impulse, we'd see 10338.66. Continuation would bring 10362.18. FXtechtrade http://www.fxtechtrade.com Disclaimer: Any information presented by Nikolajs Serikovs at this very website should be in no way understood as an offer, promise or guarantee for receiving a profit or avoiding the losses. Stated here levels of support and resistance must not be construed as an investment advice or endorsement for any financial instrument. There exists no guarantee that the market would behave in accordance with the information stated here Prepared in Republic of Latvia for the worldwide distribution.

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Fitch Says Japan Recovery to Be ‘Modest and Fragile’

By Lily Nonomiya

Nov. 10 (Bloomberg) -- Japan is unlikely to experience a “rapid economic recovery” as a stronger yen, falling prices and unemployment weigh on growth, Fitch Ratings said.

“The recovery process for Japan in 2010 is expected to be modest and fragile, since domestic economic conditions point towards a possibly extended period of deflation,” David Riley, head of global sovereign ratings at Fitch, said in a statement released in Tokyo today.

Reports today painted a mixed view of the world’s second- largest economy, with the current-account surplus unexpectedly widening in September while merchant sentiment tumbled to a five-month low. Japanese government bond yields advanced to their highest level in four months yesterday on concern Prime Minister Yukio Hatoyama’s government will exacerbate what is already the largest debt burden in the industrialized world.

Fitch said the possibility of prolonged price declines would pose a “material risk” to the outlook for the country’s debt. The company has an AA rating and a stable outlook on Japan’s long-term, foreign-currency borrowings, the third- highest grade.

The yen traded at 89.80 per dollar at 4:11 p.m. in Tokyo from 89.93 late yesterday, and has gained 8.2 percent in the past three months, eroding the value of exporters’ repatriated profits and making their products more expensive abroad.

‘Very Concerned’

Ten-year yields fell half a basis point to 1.47 percent. They are up from 1.31 percent before the Democratic Party of Japan won an Aug. 30 election and climbed to 1.475 percent yesterday, the highest level since June 17.

“Maintaining the trust of investors in the government bond market is our priority,” Finance Minister Hirohisa Fujii said today, adding that he’s “very concerned” about the recent increase in yields.

Japan’s economy emerged from its worst postwar recession in the second quarter, and analysts predict a report next week will show the expansion accelerated in the three months ended September. Gross domestic product rose at an annual 2.9 percent pace from the previous quarter, according to the median estimate of 17 economists surveyed by Bloomberg News.

The government’s fiscal and monetary stimulus measures have been “effective in preventing an even sharper economic downturn,” Fitch said. The government is spending more than 20 trillion yen ($223 billion) to spur growth, while the Bank of Japan has cut interest rates to 0.1 percent and bought corporate debt from lenders to funnel cash to businesses.

Fewer Bankruptcies

The programs helped corporate bankruptcies decline for a third month in October, according to a report released by Tokyo Shoko Research Ltd. today. The central bank last month said it will end its corporate debt purchases in December, citing an improvement in companies’ ability to raise funds.

The current-account surplus widened 0.2 percent in September from a year earlier to 1.57 trillion yen, the Finance Ministry said in Tokyo, as world stimulus spending helped to ease declines in exports.

The nation’s Economy Watchers index, a gauge of sentiment among merchants, slid to 40.9, prompting the Cabinet Office to say it was more pessimistic about the economic outlook.

“The recovery may be approaching a slowdown,” said Junko Nishioka, chief economist at RBS Securities Japan Ltd. in Tokyo. “The worst is over, but to see real improvements in sentiment among consumers and retailers, we have to see a better job market.”

Not Spreading

Seven months of gains in industrial production have yet to spread to consumers, whose spending accounts for more than half of the economy. Wages have slid for 16 months, exacerbating declines in consumer prices. The Bank of Japan last month forecast deflation will extend into fiscal 2011 even as economic growth picks up.

Riley said the AAA ratings of economies including the U.S. and U.K. have given policy makers “flexibility” in rolling out stimulus packages, yet the outlays have also stretched their budgets, making the scope for further measures limited.

“Many credit profiles of major ‘AAA’ sovereigns have been significantly weakened by the financial crisis and the subsequent recession,” said Riley. “Thus, the already out- sized budget deficits and the rise in government debt had reduced the ‘fiscal space’ for policy makers to respond to further adverse shocks.”

To contact the reporter on this story: Lily Nonomiya in Tokyo at lnonomiya@bloomberg.net

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Growth Driven by U.S. Factories as Spending Slows, Survey Shows

By Shobhana Chandra and Kristy Scheuble

Nov. 10 (Bloomberg) -- Economic growth in the U.S. will be stronger over coming quarters than previously anticipated as manufacturing, business spending and exports pick up while consumers cool off, a monthly economists’ survey indicated.

The world’s largest economy will expand at a 3 percent annual rate in the last three months of the year, compared with the 2.4 percent estimated last month, according to the median of 64 forecasts in the Bloomberg News survey. The jobless rate is projected to exceed 10 percent through the first half of 2010, giving households reason to be prudent spenders.

“It’s definitely not the consumer who’s going to drive economic growth,” said Nariman Behravesh, chief economist at IHS Global Insight in Lexington, Massachusetts. “Businesses are initially going to be very cautious about hiring so consumer spending will be anemic. In its early stages, it won’t feel like much of a recovery.”

Economists surveyed also boosted their gross domestic product forecasts for next year and 2011 as $2 trillion in global government stimulus spurs sales and companies invest in new equipment. Elevated joblessness will prevent Federal Reserve policy makers from raising the interest rate target until their meeting in August 2010 at the earliest.

Short-term interest rates near zero will weigh on the dollar, which yesterday weakened to a 15-month low against the currencies of major U.S. trading partners. It also means stocks will perform better than bonds, said John Herrmann, president of Herrmann Forecasting. The Dow Jones Industrial Average closed at a 13-month high yesterday.

Good for Stocks

“The low rates are phenomenal for stocks, and put more pressure on the dollar,” Herrmann said from Summit, New Jersey. “It’ll push investors out of the cautious environment of Treasury markets and into equities and more risky assets overseas. It’s fueling the global recovery for risk-taking.”

Consumer spending, after putting in its best performance in more than two years in the third quarter, will cool in the last three months of the year and be slow to recover, according to the survey taken from Nov. 2 to Nov.9. Household purchases will grow at a 1.2 percent pace this quarter following the third-quarter’s 3.4 percent gain.

The anticipated increase in spending, which accounts for about 70 percent of the economy, was 1.9 percent for next year and 2.5 percent for 2011, the survey showed. Gains averaged 3 percent over the past two decades.

Job Worries

Mounting concern over job prospects is one reason for waning confidence and restrained spending. Payrolls fell by 190,000 in October, and the jobless rate jumped to 10.2 percent, exceeding the 10 percent mark for the first time since 1983. Pfizer Inc., the world’s biggest drugmaker, and Sprint Nextel Corp., the third-largest U.S. mobile-phone carrier, yesterday announced plans to cut jobs.

“The labor market is moving toward stabilization, but it’s got a long ways to go,” said David Resler, chief economist at Nomura Securities International Inc. in New York. “Prospects for growth have improved, but this is not going to be a recovery that’s going to make anyone feel good. There won’t be much room for discretionary spending on the part of consumers.”

The projected 3.3 percent pace of expansion in the last half of this year pales in comparison to the 7.2 percent gain in the six months after the 1981-82 recession ended, the last time the jobless rate exceeded 10 percent.

Businesses, on the other hand, are gearing up to purchase new equipment and rebuild inventories after slashing stockpiles at a record pace earlier this year. Better-than-estimated profits also bode well for investment, economists said.

Investment Gains

“So much of business investment was put on the back burner, and now projects are coming back on stream,” said Stephen Stanley, chief economist at RBS Securities Inc. in Stamford, Connecticut. “That’s really going to be the biggest single contributor to growth in the next couple of quarters.”

Cisco Systems Inc.’s John Chambers, one of the first technology leaders to herald the recession two years ago, said he now sees a global economic recovery, fueling a rebound in his company’s sales this quarter. San Jose, California-based Cisco, the biggest maker of network equipment, also trimmed costs in the past year, including a hiring freeze and travel cutbacks.

“The numbers are indicating us being in the early, initial phase of a recovery -- with the U.S. leading the way,” Chambers said in an interview last week, following the release of Cisco’s quarterly results. “The numbers for U.S. enterprise orders were dramatic.”

The survey results also underscore why Fed Chairman Ben S. Bernanke and his colleagues last week reiterated a pledge to keep borrowing costs low for an “extended period.”

“Clearly, the Fed isn’t in any great hurry to move up rates,” said RBS Securities’ Stanley. “The risk they’re working hardest to avoid is a double-dip scenario,” where the economy starts shrinking again, he said.

To contact the reporter on this story: Shobhana Chandra in Washington schandra1@bloomberg.netKristy Scheuble in Washington at kmckeaney@bloomberg.net

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U.K. House-Price Gauge Rises to Near 3-Year High, RICS Says

By Svenja O’Donnell

Nov. 10 (Bloomberg) -- A gauge of U.K. house prices rose to the highest level in almost three years in October, led by London, as a shortage of homes for sale intensified, an industry report showed.

The number of real-estate agents saying prices rose exceeded those reporting declines by 34 percentage points, up from 21 points in September and the most since December 2006, the Royal Institution of Chartered Surveyors said in its monthly survey today. A separate British Retail Consortium survey showed stores posted their best October sales growth since 2002.

“There is a lot of evidence to suggest that there is a fair degree of momentum in the market,” Simon Rubinsohn, chief economist at London-based RICS, said in an interview with Bloomberg Television. “The context of all of this is still going to be a general shortage of desirable property.”

Buyers are returning to the housing market after values fell as much as a fifth from their peak in 2007. Bank of England policy makers last week slowed the pace of bond purchases amid signs that rising property and stock markets are helping the economy shake off its worst recession in at least three decades.

The sales-to-stock ratio, a measure of slack in the housing market, rose to 30 from 29 in September, the report showed. Average sales per surveyor over the last three months climbed to 19 from 18.5.

The upturn in house prices was led by the U.K. capital, where the net balance of surveyors saying prices rose jumped to 95 points, the most since December 1996, RICS said.

Limited Supply

“We are continuing to see an increase in demand from potential purchasers and with only a limited supply of properties coming onto the market, prices are continuing to rise,” said James Perris at De Villiers Surveyors in central London.

Services, manufacturing and house prices are showing signs of recovery as consumer confidence grows. Mortgage approvals climbed to their highest level for 18 months in September, and data from Lloyds Banking Group Plc’s Halifax division showed home values rose twice as much as forecast in October.

Sales at U.K. stores open at least a year rose 3.8 percent in October from a year earlier, the BRC said today. Sales dropped 2.2 percent in October 2008 after the collapse of Lehman Brothers Holdings Inc. sent consumer confidence tumbling.

Rising unemployment may yet weigh down on spending and home values. London-based broker Savills Plc said on Nov. 6 that house prices probably will fall as much as 6.6 percent next year, reversing an estimated 3.7 percent gain in 2009.

To contact the reporter on this story: Svenja O’Donnell in London at sodonnell@bloomberg.net.

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Malaysian Production Declines Least in 11 Months Amid Recovery

By Stephanie Phang and Michael J. Munoz

Nov. 10 (Bloomberg) -- Malaysia’s industrial production fell the least in 11 months in September as improving local and overseas demand revived orders for manufactured goods.

Production at factories, utilities and mines dropped 6 percent from a year earlier, after decreasing a revised 7 percent in August, the Putrajaya-based Statistics Department said today. That compares with the median estimate for a 3.8 percent decline in a Bloomberg News survey of 17 economists.

Malaysia raised its 2009 economic forecast last month, joining Asian neighbors including Singapore and Thailand in saying this year’s slump is easing more than expected as the world recovers from recession. Prime Minister Najib Razak said last week the outlook for growth in the third quarter has “brightened.”

“As private consumption recovers in developed economies and emerging markets, shipments from Malaysia are going to rise and thus support production,” said Rahul Bajoria, an economist at Barclays Capital in Singapore.

Exports of Malaysian Pacific Industries Bhd. semiconductors and other goods fell 24.2 percent in September, easing from a 29.7 percent slump in May, after policy makers around the world cut interest rates and poured about $2 trillion of stimulus into the global economy to revive growth.

Worldwide semiconductor sales rose 8.2 percent in September from August, according to the San Jose, California-based Semiconductor Industry Association.

Najib said Oct. 23 that Malaysia’s $195 billion economy may shrink 3 percent this year, less than an earlier forecast for a contraction of 4 percent to 5 percent. The government expects gross domestic product to expand as much as 3 percent in 2010.

Malaysia’s manufacturing output fell 7.9 percent in September, after a 7.7 percent decline the previous month that was the smallest drop since October 2008.

Mining slid 3 percent, while electricity production gained 1.8 percent, climbing for a fourth month. Overall industrial production contracted 10.8 percent in the first nine months of the year.

To contact the reporter on this story: Stephanie Phang in Singapore at sphang@bloomberg.net

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China to Overlook Call for Yuan Gain, Researchers Say

By Bloomberg News

Nov. 10 (Bloomberg) -- China, rejecting calls from Europe and Japan, will keep the yuan from gaining against the dollar until exports revive, state researchers said.

Policy makers are unlikely to allow the currency to resume its appreciation this year after keeping it almost unchanged since July 2008, Beijing-based Zhu Baoliang, the chief economist at the State Information Center, said in an interview yesterday. China will stick with its “tough stance” on the currency, Zhang Ming, a researcher at the Chinese Academy of Social Sciences, said in a separate interview.

European Central Bank President Jean-Claude Trichet and Japanese Vice Finance Minister Yoshihiko Noda called last week for the yuan to strengthen. The U.S. Treasury Department said last month that a “lack of flexibility” in China’s exchange- rate and a buildup of foreign-exchange reserves “risk unwinding some of the progress made in reducing imbalances.”

“Foreign pressure won’t push the government to resume appreciation,” Zhu said from the State Information Center, an affiliate of the National Development and Reform Commission, China’s top economic planning agency. “There is no domestic pressure for the yuan to appreciate because exports are still having a year-on-year decline.”

Central bank Governor Zhou Xiaochuan responded to European and Japanese calls for a stronger yuan on Nov. 6, saying that global pressure on appreciation “is not that big.” World Bank Chief Economist Justin Lin said in a lecture at the University of Hong Kong yesterday that China shouldn’t be forced to let its currency appreciate because it may slow a global recovery, the Wall Street Journal reported.

President Barack Obama said in an interview with Reuters yesterday he will bring up currency issues when he visits Beijing next week. China’s policy will be “proactive, controllable and gradual,” Foreign Ministry spokesman Qin Gang said at a regular briefing today. He added that the government needs “to increase the flexibility” of the exchange rate.

Stable Yuan

China, the third-largest economy, has kept its currency at about 6.83 per dollar since July 2008, after a 21 percent gain the previous three years. As the dollar weakened against the euro and yen, the yuan slid 11 percent against the European currency and 10 percent against Japan’s in the past six months.

The yuan closed at 6.8268 per dollar in Shanghai, according to the China Foreign Exchange Trade System. Twelve-month non- deliverable forwards for the yuan fell 0.4 percent to 6.6295. The contracts reflected bets for the currency to rise 3 percent in a year.

China is preventing its currency from appreciating after overseas sales slumped 11 straight months through September. Exports fell 13 percent from a year earlier in October, the smallest decline this year, according to the median estimate of 31 economists surveyed by Bloomberg. The customs bureau will release the latest export data tomorrow.

Appreciation Forecasts

The currency will strengthen to 6.7 per dollar by June 30, according to the median estimate of 25 analysts in a Bloomberg News survey. The yuan has a 73 percent chance of rising to that level by the end of the first half of 2010, implied volatility from options trading monitored by Bloomberg showed.

China’s economy expanded 8.9 percent in the third quarter, the fastest pace in a year, according to official data. The government is targeting growth of 8 percent in 2009.

Rising asset prices and capital inflows may “persuade” the central bank to allow the yuan to appreciate next year, the Chinese Academy’s Zhang said from Beijing. It may rise about 5 percent against the U.S. currency, he said.

The Shanghai Stock Exchange Composite Index climbed 76 percent this year, the 10th best performer among 89 benchmark measures tracked by Bloomberg. China’s foreign-exchange reserves have risen 19 percent in the past year to a record $2.273 trillion because of capital inflows and a trade surplus.

“Even when the central bank wants to change the yuan policy, it will have to deal with pressure from the commerce ministry and local governments in the coastal areas,” Zhang said.

Inflation Risk

Consumer prices slid 0.8 percent in September from a year earlier. Government data to be released tomorrow may show prices fell 0.4 percent last month, a separate Bloomberg survey showed.

China, which buys U.S. dollars to prevent the yuan from appreciating, was the biggest foreign holder of U.S. government debt in August with $797.1 billion, Treasury Department data show. Premier Wen Jiabao said in March that he was “worried” about the weakening dollar eroding the value of its reserves.

The Dollar Index, which tracks the greenback against currencies of six major trading partners, dropped 7.6 percent this year, the most since 2007.

The government will probably allow a 3 percent to 4 percent increase in the yuan next year to curb the size of reserves and preserve their value as the dollar declines, said Shen Minggao, chief economist in Hong Kong for Greater China at Citigroup Inc.

“Capital inflows to China have quickened and the growth in China’s exchange reserves remained fast, which seems hard to sustain,” he said. “The yuan’s appreciation is not only called for overseas, it’s also in line with China’s own interest.”

--Judy Chen, Belinda Cao. Editors: Shanthy Nambiar, Sandy Hendry

To contact Bloomberg News staff for this story: Judy Chen in Shanghai at +86-21-6104-7047 or Xchen45@bloomberg.net.

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Tighter Bank Lending Standards Reinforce Fed Decision on Rates

By Scott Lanman

Nov. 10 (Bloomberg) -- The Federal Reserve said U.S. banks kept tightening lending standards for companies and consumers last quarter, reinforcing the central bank’s decision to leave its benchmark interest rates at record lows for a long time.

At the same time, the number of banks making it tougher to borrow diminished, the Fed said yesterday in its quarterly Senior Loan Officer survey. Demand for most types of loans weakened at a smaller number of banks than in the second quarter, the survey showed.

The report helps explain why Fed policy makers last week said “tight credit” remains a drag on the economy and pledged to keep their benchmark interest rate near zero for an “extended period.” JPMorgan Chase & Co. is among the banks that have reduced lending in response to stricter underwriting standards for consumer loans and lower demand among companies.

“The fact that banks are still tightening standards is just another reason why the Fed is not going to be raising rates anytime soon,” said Dean Maki, chief U.S. economist at Barclays Capital Inc. in New York, who predicts the Fed won’t tighten until September.

While the Fed isn’t about to raise rates, with fewer banks making it tougher to borrow, “credit may be less of a headwind to growth in coming quarters than is commonly believed,” said Maki, a former Fed economist. The percentage of banks tightening standards was “quite similar” to the end of the last recession, in 2001, he said.

Separately, the Fed said yesterday that nine of 10 bank holding companies deemed short of capital in May have raised their reserves enough to withstand the risk of higher unemployment and slower economic growth.

Talks With Treasury

The one exception, GMAC Inc., “is expected to meet its remaining buffer need by accessing” one of several government programs to help the auto industry, the Fed said. GMAC is “in discussions with the U.S. Treasury on the structure of its investment,” it said.

The survey of loan officers at 57 U.S. banks and 23 U.S. branches of foreign banks was conducted from about Oct. 6 to Oct. 20, the central bank said. The report doesn’t identify respondents.

Loans and leases held by U.S. commercial banks have declined for 10 straight months, falling to $6.7 trillion as of Oct. 28 from $7.2 trillion at the end of 2008, according to a separate statistical release from the Fed.

Commercial and industrial loans have dropped to $1.37 trillion from $1.6 trillion, commercial real-estate loans have declined to $1.66 trillion from $1.72 trillion, and consumer loans have fallen to $847 billion from $857 billion at the end of last year.

Commercial Loans

In response to a special question on the decline in commercial and industrial loans, banks cited lower originations of loans and decreased draws on revolving credit lines as the two most important reasons for the drop.

About a net 15 percent of banks tightened standards on commercial and industrial loans, half of the prior survey and below the peak of about 80 percent a year ago, the Fed said. Also, about a net 15 percent of respondents said they tightened standards for credit-card loans, the smallest since April 2008 and down from 35 percent in the July survey.

Banks were extending commercial real estate loans more often than refinancing them, the survey showed. About 75 percent reported extending more than one-fourth of construction and land development loans scheduled to mature by September.

The Standard & Poor’s 500 Index advanced 2.2 percent to 1,093.08 at 4:05 p.m. in New York for its sixth straight gain. Financial companies gained the most of 10 industry groups in the S&P 500, adding 3.6 percent collectively.

‘Work Constructively’

Last month, the Fed and other regulators urged commercial real estate lenders to “work constructively” to arrange modifications with borrowers who show a willingness to repay debt.

Loan originations by the biggest U.S. banks receiving government assistance fell by 17 percent in August from a month earlier, the Treasury Department said Oct. 15.

In its monthly survey of lending by the top 22 recipients of capital injections from the $700 billion Troubled Asset Relief Program, the Treasury also said total loan balances fell by 1 percent in August from a month earlier.

Loans at New York-based JPMorgan fell to $653.1 billion at the end of the third quarter from $761.4 billion a year earlier. The decline reflected “some tightening of underwriting standards” on consumer loans, including credit cards, Chief Financial Officer Michael Cavanagh told analysts during an Oct. 14 call following the release of the quarter’s results. Loan demand from companies also fell, he added.

Bank of America Corp.’s loans and mortgages shrank to $878.4 billion from $922.3 billion a year earlier. The drop was due to “lower consumer spending and a resurgence in the capital markets” that allowed corporations to issue bonds and equity to pay off debt, Kenneth Lewis, chief executive officer of the Charlotte, North Carolina-based bank, said on an Oct. 16 conference call with analysts after the third-quarter report.

To contact the reporter on this story: Scott Lanman in Washington at slanman@bloomberg.net.

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Europe Finance Chiefs Commit to Curb Budget Deficits

By Jennifer Ryan and Francois de Beaupuy

Nov. 10 (Bloomberg) -- European Union finance ministers committed to start reining in budget deficits by 2011 at the latest even as they said economic stimulus remains necessary to nurture the recovery from the deepest slump in six decades.

“Restoring the public finances and tackling unemployment will be the priorities for the time to come,” Spanish Economy Minister Elena Salgado told a press conference in Brussels late yesterday after leading a meeting of euro-area finance chiefs. “Without doubt, public finances are on an unsustainable course,” said Swedish Finance Minister Anders Borg, whose government holds the EU’s rotating six-month presidency.

European governments have put forward billions of euros in measures aimed at reviving growth and saving jobs. The average budget shortfall in the euro region will balloon to a record 6.9 percent of gross domestic product next year with all 16 euro nations breaching the EU limit of 3 percent of GDP, the European Commission forecasts. The jobless rate is projected to reach 10.9 percent in 2011, the most since at least 1995.

The commission, the Brussels-based EU executive, tomorrow will issue reports assessing efforts by France, Spain, Ireland, Greece and the U.K., which isn’t in the euro area, to start to bring their deficits back into line with EU rules. Germany, Europe’s largest economy, and eight other countries will be given deadlines to correct their deficit overruns.

‘Adequate Deadlines’

“We need to establish the adequate deadlines and paths for the correction of these excessive deficits,” EU Economic and Monetary Affairs Commissioner Joaquin Almunia said today in Brussels, where the euro-area finance chiefs will be joined by their counterparts from the rest of the 27 EU nations. “It is an important issue that we have to combine with short-term fiscal stimulus that is still needed.”

Overall government debt for the 27 nations in the EU will reach 79 percent of GDP in 2010 and more than 83 percent the following year, the commission forecast last month. Without budget-cutting efforts, the debt-to-GDP ratio “could reach 100 percent as early as 2014 and keep on increasing,” according to a commission document discussed at yesterday’s meeting.

The finance ministers last month agreed to wait until 2011 before cutting deficits to allow government spending to boost growth while the region recovers from the recession. Almunia affirmed that timeframe following yesterday’s meeting.

Fiscal Exit

“If things go the way most central projections suggest, then 2011 would be the year to start consolidation and fiscal exit,” Dutch Finance Minister Wouter Bos said. “We shouldn’t stop stimulating too early.”

The euro-region economy will contract 4 percent this year before expanding 0.7 percent in 2010, according to the forecasts by the commission, the EU executive. European Central Bank President Jean-Claude Trichet said yesterday that while the recovery is taking hold a little faster than expected, risks to growth mean there is “no time for complacency.”

Group of 20 governments meeting in St. Andrews, Scotland, on Nov. 7 pledged to keep interest rates low and maintain record budget deficits until recoveries take hold. Global stocks rallied yesterday and the dollar slid after the G-20 commitment to maintain stimulus efforts. Trichet said central bankers agreed on the need for a “gradual and timely phasing out” of non-conventional policy measures without signaling that such a move was imminent.

Banking Industry

Ministers also will discuss how to phase out support for the banking industry. EU governments have provided 920 billion euros ($1.4 trillion) in guarantees for the financial-services industry, and officials should begin making the national plans “less attractive” by bringing the pricing of aid “closer to market conditions,” according to a draft report by EU regulators to be discussed at today’s meeting.

The U.K. last week gave more support to Royal Bank of Scotland Group Plc, making it the most expensive bank bailout ever. Barclays Plc, the U.K.’s second-biggest bank, said today that third-quarter earnings fell 54 percent as impairment charges increased.

“The tricky thing for ministers is that there is no one- size-fits-all policy for the all the countries,” Carsten Brzeski, senior economist at ING Belgium SA in Brussels, said in an interview today with Bloomberg Television. “We have different problem cases now.”

To contact the reporters on this story: Jennifer Ryan in Brussels at jryan13@bloomberg.net; Jurjen van de Pol in Brussels at jvandepol@bloomberg.net.

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Oil Falls as Tropical Storm Ida Weakens in Gulf, Dollar Gains

By Christian Schmollinger

Nov. 10 (Bloomberg) -- Crude oil fell in New York after Tropical Storm Ida weakened in the Gulf of Mexico as it headed for the U.S. Gulf coast, reducing the potential of further supply disruptions.

Ida’s sustained winds have dropped to 60 miles (97 kilometers) per hour from 65 mph earlier, the National Hurricane Center said on its Web site. Producers have begun preparations to resume operations. Oil also declined as the dollar rebounded from a two-week low against the euro, reducing the appeal of commodity as an inflation hedge.

“Most people feel that the storm isn’t going to be that severe,” said Anthony Nunan, an assistant general manager for risk management at Mitsubishi Corp. in Tokyo. “This is the last hurrah for the hurricane season.”

Oil for December delivery declined as much as 86 cents, or 1.1 percent, to $78.57 a barrel in electronic trading on the New York Mercantile Exchange. It was at $78.62 a barrel at 3:54 p.m. Singapore time. Yesterday, the contract rose $2, or 2.6 percent, to $79.43. Prices have gained 76 percent this year.

Ida was centered 100 miles south-southwest of Mobile, Alabama, at 9 p.m. local time and was moving north at 13 mph, the center said. Workers were evacuated in the Gulf of Mexico and companies idled 29.6 percent of oil and 27.5 percent of natural gas output, according to government data.

Marathon Oil Corp. said it may start work on bringing output back tomorrow. The company had evacuated and shut in production at a platform located at Ewing Bank 873, which can produce the equivalent of about 12,000 barrels of oil a day, Lee Warren, a company spokesman, said in an e-mail.

U.S. Stockpiles

The dollar climbed on prospects investors reduced short positions on the currency before a U.S. public holiday tomorrow. The greenback traded at $1.4991 per euro as of 3:16 p.m. in Singapore from $1.4999 in New York yesterday, when it touched $1.5020, the lowest since Oct. 26.

U.S. crude-oil inventories probably rose 1 million barrels in the week ended Nov. 6, according to the median of 10 estimates by analysts before an Energy Department report.

Supplies of distillate fuel, a category that includes heating oil and diesel, declined 700,000 barrels from 167.4 million the prior week, according to the survey. Gasoline stockpiles probably dropped 400,000 barrels from 208.3 million in the week before, the survey showed.

The department is scheduled to release its weekly report on Nov. 12 at 11 a.m. in Washington, a day later than usual because of the Veterans’ Day holiday on Nov. 11.

Brent crude for December settlement fell as much as 87 cents, or 1.1 percent, to $76.90 on the London-based ICE Futures Europe exchange. It was at $77.08 a barrel at 3:58 p.m. Singapore time. Prices rose $1.90, or 2.5 percent, to $77.77 a barrel yesterday.

World Reserves

World oil reserves are more depleted than official estimates state, the Guardian reported, citing a whistleblower at the International Energy Agency.

The IEA has been underplaying a future oil shortage while overplaying the chances of finding new reserves under pressure from the U.S. amid a fear of triggering panic buying, the newspaper reported, citing an unidentified senior official at the IEA.

Peak oil critics have often wrongly questioned the accuracy of its figures, the IEA said last night, ahead of the publication of its World Energy Outlook report today, the newspaper said.

To contact the reporter on this story: Christian Schmollinger in Singapore at christian.s@bloomberg.net

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Euro May Fall to 8-Week Low Against Pound: Technical Analysis

By Ron Harui

Nov. 10 (Bloomberg) -- The euro may fall to an eight-week low against the British pound should it drop below so-called support at 89.06 pence, said Pak Lai Ng, a technical analyst at Forecast Pte in Singapore, citing trading patterns.

Europe’s currency is likely to test that level in a week, Ng said. The support is a 50 percent retracement of the euro’s rise from its June low of 84.01 pence to the October high of 94.12 pence, based on a series of numbers known as the Fibonacci sequence.

“The euro-pound looks like it’s going to break down,” Ng said in an interview. “It may test that Fibonacci level and then the 200-day and 100-day moving averages” of 88.65 pence and 88.20 pence, respectively, he said.

The euro traded at 89.46 pence as of 8:02 a.m. in Tokyo from 89.49 pence in New York yesterday. The 88.20 pence level would be the lowest since Sept. 15. Europe’s currency has weakened 3.8 percent versus the pound in the past month.

Daily momentum indicators such as the moving average convergence/divergence, or MACD, show a sell signal for the euro against the pound, according to Ng. “The focus is still on the downside,” he said.

MACD charts can indicate whether a price shift is a change in trend or a short-term deviation by comparing moving averages based on nine-, 12- and 26-day periods. Fibonacci charts are based on the theory that securities tend to rise or fall by specific percentages after reaching a new high or low. A break below support or above resistance indicates a currency may move to the next level.

In technical analysis, investors and analysts study charts of trading patterns and prices to forecast changes in a security, commodity, currency or index. Support is a level where buy orders may be clustered, while resistance is where there may be sell orders.

To contact the reporter on this story: Ron Harui in Singapore at rharui@bloomberg.net.

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South Korean Won Rises to 13-Month High; Bonds Little Changed

By Bob Chen

Nov. 10 (Bloomberg) -- South Korea’s won traded near a 13- month high after the Group of 20 nations agreed to maintain economic stimulus measures, bolstering demand for Asian exports and helping emerging markets attract funds.

Foreign investors bought more Korean shares than they sold for a third day, driving the Kospi index to its best close this month. Japan today reported an unexpected widening of its current-account surplus for September as stimulus spending helped damp a slump in the nation’s overseas sales. The won retraced earlier gains today after South and North Korean warships exchanged fire.

“Increasingly the outlook for risk is very good,” said Wai Ho Leong, a regional economist in Singapore at Barclays Plc. “Japan’s current-account surplus helps the perception of Asia’s recovery story and deepens it somewhat. The question is where you should invest in Asia, and Korea and Taiwan come off as strong cyclical recovery stories.”

The won traded at 1,162 per dollar as of the 3 p.m. close in Seoul, from 1,160.8 yesterday, according to data compiled by Bloomberg. It touched 1,154.80, the strongest level since September 2008. Leong forecast the currency will reach 1,150 in a month and 1,135 by early February. The Kospi advanced 0.4 percent to 1,582.30.

European Central Bank President Jean-Claude Trichet, speaking on behalf of the world’s central bankers, said yesterday the global economy is recovering a little faster than expected. U.K. Chancellor of the Exchequer Alistair Darling, hosting a meeting of finance ministers from G-20 nations, said Nov. 7 that he and his counterparts “agreed to maintain support for the recovery until it is assured.”

Shots Fired

A North Korean vessel ventured 1.3 kilometers (0.8 miles) into waters claimed by South Korea at about 10:33 a.m. local time today, triggering an exchange of fire, according to the Joint Chiefs of Staff in Seoul. The ship returned across the border after it was badly damaged in the exchange, Yonhap News reported, citing a government official it didn’t identify.

“Regional currencies weakened after news of the Korean ships and following strength in the greenback,” said Dariusz Kowalczyk, chief investment strategist at SJS Markets Ltd. in Hong Kong. “The timing of the weakening of the won is very correlated with the first report of the ships.”

Japan’s current-account surplus rose 0.2 percent from a year earlier to 1.57 trillion yen ($17.5 billion) in September, the finance ministry reported today. The median estimate of 22 economists surveyed by Bloomberg was for the gap to narrow to 1.51 trillion yen. A separate survey forecast China’s exports fell at the slowest pace this year in October, before data to be released tomorrow.

South Korea’s government bonds were little changed. The yield on the 4 percent note due June 2012 was 4.48 percent, according to Korea Stock Exchange.

For Related News and Information: For top currency news: TOP FRX For news on analyst reports: NI ANAFX Most read stories on Korea: MNI KOREA

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Kingsgate Seeking $50 Million Loan for Thai Gold Mine

By Jesse Riseborough

Nov. 10 (Bloomberg) -- Kingsgate Consolidated Ltd., owner of Thailand’s biggest gold mine, is seeking a loan of about $50 million to finance half the cost of a plant expansion at its Chatree project that is forecast to double production by 2011.

“We are going to be financing $100 million, we want to do some from internal cash flow and some will come from the debt markets,” Gavin Thomas, chief executive officer of the Sydney- based company, said today by phone. Kingsgate is in talks with Investec Plc for a $25 million loan and for a similar amount from a group of Thai banks, he said.

Gold futures climbed to a record for the second straight session yesterday as the slumping dollar spurred demand for the precious metal as an alternative investment. A $100 million expansion will double capacity at the plant to as much as 240,000 ounces a year, according to the company.

“At this stage, I would expect that as long as everything stays pretty stable and we can get some support from the Thai government, I think the project will probably go ahead,” Thomas said, adding that the plan will likely go to the board for approval within the next two months. “There’s been meetings and trips to site, they are progressing along well.”

Kingsgate advanced 3.8 percent to a record A$9.34 at the 4:10 p.m. Sydney time on the Australian stock exchange. That’s the highest since the company began trading its shares in 1988. The stock has more than doubled this year and has a market value of A$902 million ($836 million).

Production will be at the “upper end” of the company’s forecast for between 120,000 and 140,000 ounces of gold in the 2010 fiscal year, Thomas said.

The price of gold for immediate delivery was dropped 0.3 percent to $1,100.27 an ounce at 4:21 p.m. Sydney time.

To contact the reporter on this story: Jesse Riseborough in Melbourne at jriseborough@bloomberg.net

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Copper Drops for First Day in Three in Shanghai on Inventories

By Glenys Sim

Nov. 10 (Bloomberg) -- Copper fell for the first time in three days in Shanghai as global inventories extended their advance, easing concerns supply may not keep pace with demand.

Inventories tallied by the London Metal Exchange expanded for a fifth day to a six-month high of 389,475 metric tons yesterday, while stockpiles monitored by Comex stood at 65,590 short tons yesterday, the highest since August 2004. Stockpiles in Shanghai warehouses expanded 1,440 tons last week to 104,275 tons, the highest level since April 2004.

“To date, the increase in exchange copper stocks has not proved to be as much of a drag on the copper price as we had anticipated, but does represent an ongoing source of downside risk,” David Moore, commodity strategist at Commonwealth Bank of Australia, said in an e-mail today.

February-delivery copper on the Shanghai Futures Exchange dropped as much as 1.5 percent to 50,780 yuan ($7,437) a ton and ended the day at 50,860 yuan

Copper for delivery in three months on the London Metal Exchange lost as much as 0.3 percent to $6,520 a ton, before trading at $6,534.75 at 3:12 p.m. Singapore time. The December- delivery contract on the Comex division of the New York Mercantile Exchange was little changed at $2.9620 a pound.

The dollar’s rebound before the Veterans Day holiday in the U.S. tomorrow weighed on commodities from copper to crude oil and gold. The dollar rose today against a basket of six main trading partners, after falling to a 15-month low yesterday.

‘Not Unexpected’

Still, the increase in exchange copper stockpiles “is not unexpected,” said Moore. “There is some seasonality to copper market balances and, therefore, copper surpluses. The market tends to be less tight in the second half,” he added.

A labor dispute at BHP Billiton Ltd.’s Spence copper mine in Chile helped limit the metal’s losses. Workers walked out Oct. 13 after rejecting a wage offer and plan to stage a protest outside the company’s office in Santiago tomorrow, a union official said yesterday.

Among other LME-traded metals, aluminum fell 0.4 percent to $1,945 a ton, lead lost 1.7 percent to $2,260 a ton, and nickel slid 0.6 percent to $17,320 a ton. Zinc declined 0.5 percent to $2,150.25 a ton, while tin dropped 0.3 percent to $14,710 a ton as of 3:12 p.m. in Singapore.

To contact the reporter for this story: Glenys Sim in Singapore at gsim4@bloomberg.net

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Japan Stocks Rise, Led by Banks After Kamei Comments on Capital

By Akiko Ikeda and Kana Nishizawa

Nov. 10 (Bloomberg) -- Japanese stocks rose, led by banks after Financial Services Minister Shizuka Kamei said the government is willing to tolerate domestic banks “briefly” falling below capital ratios to ensure the supply of credit.

Mitsubishi UFJ Financial Group Inc., the country’s biggest bank by market value, gained 2.7 percent, and Sumitomo Mitsui Financial Group Inc. added 3.6 percent. Bank shares spiked this morning after the minister’s comments and were the biggest contributors to gains in the Topix index at the close of trading. Casio Computer Co. climbed 4.4 percent after Citigroup Inc. boosted its investment rating on the maker of G-Shock watches.

“Kamei’s comments gave some breathing room to domestic banks, which were bound by the capital requirements,” said Masaru Hamasaki, a strategist at Tokyo-based Toyota Asset Management Co., which oversees the equivalent of $14 billion. “They’re giving a sense of relief to the market.”

The Nikkei 225 Stock Average rose 0.6 percent to 9,870.73 at the close of trading in Tokyo. The broader Topix added 0.2 percent to 872.44, with nine stocks advancing for every seven that retreated.

The Topix fell 0.4 percent yesterday, the only benchmark gauge among the world’s 20 largest stock markets to decline. Shares in the index trade at 36 times estimated earnings on average, compared with 20 at the beginning of the year.

In New York yesterday, the Standard & Poor’s 500 Index advanced 2.2 percent for its sixth straight increase, led by financial companies, after the Group of 20 agreed to maintain economic stimulus measures.

Banks Lead Advance

Mitsubishi UFJ climbed 2.7 percent to 503 yen and was the most-actively traded stock by value in Japan. Sumitomo Mitsui Financial Group added 3.6 percent to 3,170 yen. Mizuho Financial Group Inc. increased 1.1 percent to 178 yen.

Local banks that use domestic accounting standards won’t be punished if their capital-adequacy ratios slip below 4 percent for a limited period of time, Kamei told reporters in Tokyo today. The minister said his focus is on making sure banks continue lending.

The country’s largest banks use international standards and are required to keep their capital-adequacy ratios, a key measure of financial strength, above 8 percent.

Casio jumped 4.4 percent to 706 yen, the biggest gain since Aug. 28. The maker of watches and calculators had its rating raised to “hold” from “sell” by Kota Ezawa at Citigroup.

Hoya Corp., Japan’s largest maker of optical glass, rose 1.2 percent to 2,170 yen, its highest close since Sept. 24, after Ryohei Takahashi, an analyst at Bank of America Corp.’s Merrill Lynch unit, boosted his rating to “buy” from “underperform” and increased a 12-month share price estimate by 43 percent to 2,500 yen.

Dainippon Screen Manufacturing Co. advanced 7.8 percent to 385 yen, its sharpest advance since Oct. 7. The maker of chip- equipment narrowed its forecast full-year net loss to 12 billion yen from 15 billion yen, as orders from makers of semiconductors and liquid-crystal display panels begin to rise.

To contact the reporters for this story: Akiko Ikeda in Tokyo at iakiko@bloomberg.net; Kana Nishizawa in Tokyo at knishizawa5@bloomberg.net.

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Areva, Arkema, Klepierre, Meetic, Sodexo: French Equity Preview

By Helene Fouquet and Adria Cimino

Nov. 10 (Bloomberg) -- The following is a list of companies whose shares may have unusual price changes in France. Symbols are in parentheses after company names and prices are from the last close.

November futures on France’s CAC 40 Index climbed 5, or 0.1 percent, to 3,774 at 8:38 a.m. in Paris. The CAC 40 rallied 78.2, or 2.1 percent, to 3,785.49 yesterday.

Areva SA (CEI FP): The world’s biggest builder of nuclear reactors received three bids for its transmission and distribution unit from General Electric Co., Toshiba Corp. with Innovation Network Corp. of Japan, and the unit’s former owner, Alstom SA with Schneider Electric SA. Areva’s investment certificates added 11.4 euros, or 3.2 percent, to 367.95 euros.

Arkema SA (AKE FP): The French chemicals maker said that it’s raising its 2009 free cashflow target to 140 million euros ($210 million) from 80 million euros. The company reported a net loss of 3 million euros for the third quarter, compared with a year-earlier profit of 40 million euros. The shares rose 95 cents, or 3.5 percent, to 28.07 euros.

CGGVeritas (GA FP): The world’s largest seismic surveyor reported a 93 percent plunge in third-quarter profit amid a slowdown in oil exploration projects. Net income fell to $12 million from $162 million a year earlier. The stock added 79 cents, or 5.6 percent, to 14.98 euros.

GFI Informatique SA (GFI FP): The computer-services company reported third-quarter revenue of 169.2 million euros that was “in line with expectations.” The shares retreated 2 cents, or 0.6 percent, to 3.38 euros.

Klepierre SA (LI FP): The property company agreed to buy a further 21.3 percent stake in Italian mall owner IGC from Finiper for an estimated 47.6 million euros. The acquisition will raise Klepierre’s holding in IGC to 71.3 percent. The shares climbed 46 cents, or 1.6 percent, to 28.81 euros.

Meetic (MEET FP): Europe’s biggest publicly traded Internet dating site reported nine-month revenue of 117.2 million euros, up from 97 million euros a year earlier. The shares rose 9 cents, or 0.4 percent, to 20.39 euros.

Rougier SA (RGR FP): The French tropical-wood trader reported nine-month revenue of 91.5 million euros, down 28 percent. The shares advanced 45 cents, or 1.7 percent, to 26.86 euros.

Societe Fonciere Lyonnaise (FLY FP): The real-estate company reported nine-month revenue of 139.6 million euros, up from 135.4 million euros a year earlier. The shares fell 29 cents, or 0.9 percent, to 31.70 euros.

Sodexo (SW FP): The world’s second-biggest catering company said full-year profit gained 4.5 percent to 393 million euros after it added new hospitals to its client list and improved profitability in North America. The shares retreated 4 cents, or 0.1 percent, to 41.19 euros.

To contact the reporter on this story: Helene Fouquet in Paris at hfouquet1@bloomberg.net

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