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FRANKFURT (AFP) – The German chemical and cosmetics group Henkel, maker of Persil soap powder, reported on Friday that its core earnings jumped last year and that the 2010 outlook was good as well.

Henkel's earnings before interest and tax (EBIT) surged by 38 percent to 1.08 billion euros (1.51 billion dollars) in 2009, even though sales slipped by 3.5 percent to 13.57 billion euros according to preliminary figures.

The final figures are to be published on February 25, and the results were noticeably better than expected in the group's adhesives and laundry and home care product units, a statement said no fax cash advance.

For 2010, Henkel said it "is confident of again outperforming its relevant markets in terms of organic sales growth," after allowing for foreign exchange effects and acquisitions or divestments.

The group also expects core earnings "to improve noticeably compared to the prior-year figures."

German Henkel reports surge in 2009 core earnings

HONG KONG – Asian stock markets dropped sharply Friday as disappointing company forecasts and growing concerns about debt-laden European nations shook investor hopes for a quicker global recovery. European markets opened higher.

Steep falls across Asia followed strong gains the day before, marking a return to heavy selling that’s pulled markets worldwide lower in the past week. The dollar continued to strengthen as investors looked for safer bets, pulling down prices for commodities.

Lackluster outlooks from major U.S. technology companies Qualcomm Inc. and Motorola Inc. exacerbated worries that global demand and corporate earnings, after improving in 2009, could prove weaker than expected this year.

Investors are also increasingly unnerved by rising debt levels in European countries like Greece and Portugal — focusing the market’s worries on the huge amounts of government borrowing and its ultimate effects on the financial system. Moody’s ratings agency added to fears that have dragged the euro to multi-month lows with a warning that Portugal’s credit rating could suffer unless its deficit was reduced.

Mark Tan, fund manager at UOB Asset Management in Singapore, said uncertainty surrounding U.S. bank regulation plans, Chinese lending curbs and other problems were being used as an excuse to book profits after last year’s rally. He expected the markets to resume an upward trend soon.

“We believe this correction will be short and sharp,” said Tan, who helps manage more than $10 billion in assets. “There’s a lot of confusion in the market at the moment. But the liquidity and economic fundamentals are still good, so this is a correction in a relatively positive market.”

Early going in the Europe, Britain’s FTSE 100 added 0.7 percent, Germany’s DAX was up 0.8 percent and France’s CAC-40 rose 0.7 percent. Wall Street futures pointed to a slightly higher open in the U.S. Friday. S&P futures gained 0.9 point, or 0.1 percent, to 1,08.40.

In Japan, the Nikkei 225 stock average tumbled 216.25, or 2.1 percent, to 10,198.04. Hong Kong’s Hang Seng index slid 234.38, or 1.2 percent, to 20,121.99, and South Korea’s Kospi fell 40 points, or 2.4 percent, to 1,602.43.

India’s market shed 0.4 percent and Shanghai was down 0.2 percent. Australia’s benchmark tumbled 2.2 percent, its resource-heavy market dragged lower by easing commodity prices fast payday loans.

Adding to investors’ unease was an initial report, to be released Friday, on U.S. gross domestic product in the fourth quarter. American GDP, a measure of the country’s economic output, is expected to rise 4.5 percent.

Global markets have gotten off to a rough start in 2010, with most down sharply for the year. Developing countries have been hit especially hard in the latest downdraft.

China and Indian benchmarks are now off about 9 percent and 7 percent for the year, respectively, as investors scale back their investments in riskier assets like equities in so-called emerging markets.

Overall, investors pulled more money out of developing market investment funds than they put into them during the week ending Jan. 27, according to a survey by EPFR Global, a Boston-based firm that tracks global fund flow data. It was the first time emerging market funds had suffered outflows of money in about 3 months.

Asian tech stocks felt part of the brunt of Friday’s selling as sentiment toward the industry continued to sour. South Korean tech giant Samsung Electronics Co. lost 3 percent even as it posted a fourth quarter profit. Japanese memory chip maker Elpida tanked 9 percent.

Also slammed were resource companies, with mining giant Rio Tinto down nearly 5 percent as a stronger greenback brought down prices for commodities, which are priced in dollars.

Meanwhile, Toyota Motor Corp. fell another 2 percent. The world’s largest automaker is struggling to salvage its safety reputation in the wake of massive recalls in the U.S., Europe and China.

Another bout of selling in the U.S. further weakened sentiment.

The Dow fell 115.70, or 1.1 percent, to 10,120.46. The Standard & Poor’s 500 index fell 12.97, or 1.2 percent, to 1,084.53, while the Nasdaq fell 42.41, or 1.9 percent, to 2,179.00.

In currencies, the euro continued to slide, falling to $1.3967 from $1.3976. The dollar was higher at 90.25 yen from 89.87 yen.

Oil prices lingered near a six-week low below $74, with benchmark crude for March delivery fluctuating before rising 26 cents to $73.90 a barrel. The contract lost 3 cents to settle at $73.64 on Thursday, the lowest since Dec. 14 when crude dropped to $73.46.

Asian markets resume slide; Europe stocks gain

HONG KONG — Shares in Rusal, the aluminum giant controlled by the Russian oligarch Oleg V. Deripaska, plunged nearly 11 percent Wednesday in their trading debut in Hong Kong, weighed down by global markets’ recent slump.

Rusal raised $2.2 billion in the initial public offering last week, making it the largest in many months in Hong Kong. The I.P.O., the first on the exchange this year, is also the first primary listing there for a company from outside Asia. Hong Kong emerged as one of the biggest venues for initial offerings last year, largely reflecting a flurry of listings from Chinese companies.

A number of Russian companies, particularly those operating near China in Siberia, or selling commodities across the border, are eager to follow Rusal’s lead and tap Chinese capital markets. These include the Russian state railroad, which operates the only rail line from the Far East to Europe.

Russian companies say they believe that Chinese investors are eager to invest in Russian mines and oil companies but have been reluctant to put money into the sometimes murky Russian stock exchanges. That is attracting to Hong Kong the Russian companies that might previously have sought to list in London or New York. China last year surpassed Germany as Russia’s largest trading partner.

Rusal, caught up in tortuous debt-restructuring negotiations last year that were among the most extensive in Russian history, eventually was approved for a listing after regulatory hold-ups pushed the timing into 2010.

A number of prominent investors, including the New York hedge fund manager Paulson & Company and Nathaniel Rothschild, the European banking family heir, bought into the offering. But concerns about Rusal’s $14.9 billion debt and other risks prompted the Hong Kong Securities and Futures Commission to limit the company’s share purchases to batches starting at a million Hong Kong dollars ($129,000) to discourage small investors from the offering.

Rusal shares finished their first day of trading at 9.66 Hong Kong dollars, 1.14 dollars below the I.P.O. price of 10.80. Mr. Deripaska said the performance was reasonable in light of recent global market declines, Reuters reported.

The overall Hong Kong market had a sixth successive session of declines Wednesday; the Hang Seng index fell 0.4 percent.

The Rusal I quick payday loan.P.O. price was set Friday before mining and metals shares swooned globally, said Mark Rubinstein, a deputy chief analyst at Metropol in Moscow, and by the time the stock started trading the drop was expected.

It should not weigh against the broader strategy of Russian companies trying to sell their shares in Hong Kong, he said.

“That it was placed successfully, that is important,” he said. “If it moves in line with the market, that is all it needs to do.”

Russian Railways, the world’s largest railway company and the operator of the Trans-Siberian Railway connecting Asia to Europe, is considering taking two subsidiaries public and could list in Hong Kong, an adviser to the company has said.

Ilyushin Finance, an aircraft leasing company partly owned by the Russian financier Aleksandr Y. Lebedev, is also considering listing in Hong Kong to raise about $200 million, according to a spokesman.

“Clearly, there’s a trend of Russians discovering Asia,” Dimitry Afanasiev, chairman of Egorov Puginsky Afanasiev & Partners, who negotiated the listing in Hong Kong, said Wednesday.

In mainland China, the Shanghai composite index dropped 1.1 percent, dragged down by continued nervousness about the Chinese authorities’ efforts to rein in bank lending in a bid to quash inflation.

Those concerns — combined with worries about President Obama’s plans for tighter restrictions on banks — have helped drag down stocks around the world for days.

“The last couple of weeks have thrown up prospects of U.S.-led banking regulation and simmering sovereign credit concerns. Neither directly challenges the strong domestic fundamentals of Asian economies, though Asia of course cannot escape the fact of its export leverage to developed economies, nor of the state of global liquidity in so far as it impacts portfolio flows,” Patrick Bennett, a strategist at Société Générale in Hong Kong, wrote in a note on Wednesday. “While there is uncertainty, we must expect some defensive positioning in Asian markets.”

Andrew E. Kramer reported from Moscow.

Newly Public Rusal Slides, Following Markets’ Slump

WASHINGTON – The Senate Tuesday rejected a plan backed by President Barack Obama to create a bipartisan task force to tackle the federal deficit this year despite glaring new figures showing the enormity of the red-ink threat.

The special deficit panel would have attempted to produce a plan combining tax cuts and spending curbs that would have been voted on after the midterm elections. The measure went down because anti-tax Republicans joined with Democrats who were wary of being railroaded into cutting Social Security and Medicare.

The Senate vote to kill the deficit task force came just hours after the nonpartisan Congressional Budget Office predicted a $1.35 trillion deficit for this year as the economy continues to slowly recover from the recession.

“Yet another indication that Congress is more concerned with the next election than the next generation,” said Sen. Judd Gregg, R-N.H., a sponsor of the plan.

The budget deficits facing Obama and Congress are large and intractable, and the CBO prediction for 2010 is roughly equal to last year’s record $1.4 trillion ocean of red ink. That means the government is borrowing to cover 40 percent of the cost of its programs.

The report predicts a sluggish economic recovery and continued high unemployment — which presages big political problems for President Barack Obama and his Democratic allies heading into the midterm elections.

The report sees unemployment averaging 10.1 percent this year as the economy grows by just over 2 percent. It would grow only slightly more next year with an unemployment rate of 9.5 percent.

“CBO expects that the pace of economic recovery will be slow,” said agency chief Douglas Elmendorf.

The latest estimates also project that the deficit will drop to $980 billion next year and $480 billion in five years — but only if a host of tax cuts enacted under President George W. Bush are allowed to expire. Most budget experts see deficits nearing or exceeding $1 trillion each year over the next decade once tax cuts and other policies are factored in.

It’s a sobering reminder of the fundamental imbalance of the federal government’s budget that comes just days before Obama’s Feb. 1 budget submission. The White House says Obama will propose a three-year freeze on domestic agency budgets, though the savings would barely make a dent. It hasn’t said whether Obama will proposes tax hikes or cuts to spiraling benefit programs such as Medicare, Medicaid and Social Security no fax pay day loans.

The 2010 deficit figure is in line with previous estimates and would be less, marginally, than last year’s $1.4 trillion shortfall. But plans afoot on Capitol Hill for a new jobs bill and a coming Obama request for war funds would add to the total.

The spending freeze, expected to be proposed by Obama during the State of the Union address on Wednesday, would apply to a relatively small portion of the federal budget, affecting a $477 billion pot of money available for domestic agencies whose budgets are approved by Congress each year. Some of those agencies could get increases, others would have to face cuts; such programs got an almost 10 percent increase this year. The federal budget total was $3.5 trillion.

The freeze on so-called discretionary programs would have only a modest impact on the deficit. The steps needed to really tackle such huge deficits include tax increases and curbs on benefit programs like Medicare, Medicaid and Social Security.

That was the idea behind the Obama-backed plan to pass a law to create a special task force to come up with a plan to curb the spiraling budget deficit. Now, Obama may create a weaker version by a presidential order. But unlike the plan rejected Tuesday, there’s no way to force a Senate vote.

Supporters actually garnered 53 votes for the plan co-sponsored by Gregg and Budget Committee Chairman Kent Conrad, D-N.D. But 60 votes were required under special floor rules. Thirty-six Democrats and independent Joe Lieberman of Connecticut voted for the plan as did 16 Republicans.

The task force was rejected after the powerful seniors lobby, led by AARP, objected to a potential fast-track debate of cuts to Social Security and Medicare. Anti-tax activists and GOP-friendly editorial pages pressed Republicans to oppose it. It would have tried to reveal a deficit reduction blueprint after the November elections for a vote before the new Congress convenes.

The plan was offered as an amendment to a deeply unpopular bill to permit the government to borrow an additional $1.9 trillion to finance its operations and prevent a first-ever default on U.S. obligations.

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On the Net:

Congressional Budget Office: http://cbo.gov/

Senate rejects bipartisan task force to tackle deficit

This Wednesday, Steven P. Jobs will step to the stage at the Yerba Buena Center for the Arts in San Francisco and unveil a shiny new machine that may or may not change the world.

In the magician’s world, that’s called “the reveal.”

And the most magical part? Even as the media and technology worlds have anticipated this announcement for months, Apple has said not word one about The Device. Reporting on the announcement has become crowdsourced, with thousands of tech and media journalists scrambling for the latest wisp and building on the reporting of others.

However miraculous the thingamajig turns out to be — all rumors point to some kind of tabletlike device — it can’t be more remarkable than the control that Apple and Mr. Jobs have over their audience.

“The reason that we all write about Apple is because we are, of course, interested, but also because everybody likes to read about Apple,” said Matt Buchanan, a contributing editor at the technology site Gizmodo. “Even if they hate Apple.”

As an organization, Apple is more disciplined in managing message than even the Obama campaign, with a culture — some would say cult — of corporate omertà. The only reason we know that the tablet is for real, that it is probably a 10-inch touch device that will cost $600 to $1,000, is that at some point, Apple had to reach out to partners who do not share its sense of pristine hygiene around information.

“Other companies put things in beta, let people try it out and then bring it out,” said Steven Levy, a senior writer at Wired. “With Apple, they say nothing, build the suspense and then say: ‘Here it is. You may discuss.’ Other companies don’t have the discipline, the heart, to do that.”

John Gruber, who writes at DaringFireball.net, says that there may be a business and communications lesson here: make something rather than talk about it.

“When I was younger, I used to love to go to the Philly car show, but I learned after a while that the coolest cars at the show — the prototypes — never get built,” he said. “Apple builds and unveils actual products. They don’t do prototypes.”

Even David Blaine, who is a real magician, calls Mr. Jobs “the ultimate showman who keeps the audience excited the whole way leading up to the reveal.” The strategy carries a measure of risk: Apple TV and the Cube were both introduced with the fanfare of an ocean liner, but behaved more like boat anchors in the marketplace. And iTunes was a soft unveiling that took its time in taking over the world in part because it came out on a Mac-only platform.

But more often than not, Apple has delivered on Mr. Jobs’s showmanship. People remember the debut of the iPhone three years ago, and Apple’s promise that it would change everything car loan. It promptly did, so who wants to miss out on the reveal for the next big thing? (I took the bait, by the way.)

Other properties unique to Apple may be at work. There is a well-chronicled reality distortion field around Mr. Jobs, and his bout with illness and industrious recovery have only reinforced his otherworldly properties. That aura, combined with the company’s history of producing technology that jailbreaks digital culture and transforms entire industries, means it’s best to remain vigilant, even when the company is saying nothing.

Another media dynamic is in play: shared interests. Because the tablet is said to create a new digital reading experience, offering publishing companies a kind of do-over, many media types see the tablet as a life preserver in the midst of the tall waves. Already, the prospective challenge has pushed Amazon to open up its Kindle reader to applications and sweetened royalty arrangements for certain kinds of content.

There was a suggestion at the beginning of the month that Apple actually quietly engages with the news media in a way that does not leave fingerprints. Writing for The Mac Observer, John Martellaro, a former senior marketing manager at Apple, said it had happened before: “The way it works is that a senior exec will come in and say: ‘We need to release this specific information. John, do you have a trusted friend at a major outlet? If so, call him/her and have a conversation. Idly mention this information and suggest that if it were published, that would be nice. No e-mails!’”

That would be news to people who have covered Apple for decades.

“What Steve wants to do more than anything is surprise the world,” said John Markoff, the longtime technology reporter at The New York Times. “It is not in his interest to have a steady drip of product information before he takes the stage.”

Paul Saffo, a veteran technologist in Silicon Valley who has known Mr. Jobs for years, said he hadn’t seen any traces of Apple in the current frenzy.

“We used to say that Apple was a ship that leaked from the top, but it’s been a lot more like North Korea for the past few years,” Mr. Saffo said. “When you look at the night sky, would you notice a single bright star or a huge black hole? Steve creates a black hole and then fills it in with stars.”

So it’s simple really. If you make a product that turns the culture upside down, drives stock price and reconfigures other industries, you step to the stage amid a herald of trumpets and perform magic.

Just make sure the dang thing works.

E-mail: carr@nytimes.com http://twitter.com/carr2n

The Media Equation: Conjuring Up the Latest Buzz, Without a Word

PORT ARTHUR, Texas – About 450,000 gallons of crude oil spilled in a southeast Texas port Saturday after two vessels collided, the U.S. Coast Guard said. No injuries have been reported, but part of the port has been closed.

U.S. Coast Guard Petty Officer Renee Aiello told The Association Press that the crude spilled at the Port of Port Arthur when a 600-foot tanker carrying oil collided with a towing vessel pushing a loaded barge. The Coast Guard was notified of the collision around 9:50 a.m., she said.

The crash left a 15-by-8-foot hole in the tanker, Aiello said low fee pay day loans. The towing vessel then ricocheted and hit another tanker that was tied to a pier. Aiello didn’t know what damage was caused to that ship.

Aiello said a portion of the oil in the damaged tank has been moved to another holding tank on the ship.

Port Arthur is about 90 miles east of Houston.

Oil spilled at east Texas port as ships collide

BERLIN — Military officials from the European countries with orders to buy the Airbus A400M military transport plane tried and failed again Friday to resolve differences over how to share billions of euros in cost overruns, but said they would resume negotiations this coming week in Berlin in the hope of meeting a Jan. 31 deadline.

Many of the participating countries need the aircraft urgently as they play a greater and more demanding role in peacekeeping missions. The repeated delays — the A400M is now more than four years behind schedule — represent a big setback for European military cooperation.

Military procurement ministers from the seven customer nations met until late into the night Thursday with top managers from Airbus and its parent company, European Aeronautic Defense & Space.

“We will meet again early next week here in Berlin,” a German defense ministry spokesman, who asked not to be identified, said Friday. “All of the participants do want a solution to this problem.” Two people with direct knowledge of the negotiations said they would likely take place Tuesday.

Alexander Reinhardt, a spokesman for EADS, said nailing down the critical details of how to finance the program remained a thorny issue.

“The negotiations have been difficult, as expected,” Mr. Reinhardt said.

Seven countries — Belgium, Britain, France, Germany, Luxembourg, Spain and Turkey — together ordered 180 A400Ms in 2003 for €20 billion, or $28.2 billion. Last year, EADS and Airbus asked them to help cover an additional €5.2 billion in costs and to accept significant delivery delays. The company has asked the countries to agree to an additional 25 percent payment, or around €5 billion, according to people with direct knowledge of the negotiations.

The Airbus chief executive, Thomas O. Enders, warned this month that without an agreement soon, the project might have to be abandoned, placing as many as 40,000 European jobs at risk.

But while France said it would consider paying more, Germany has been more than reluctant. It has ordered 60 of the 180 aircraft, while France has ordered 50.

France was supposed to receive the first deliveries of the A400M transport aircraft late last year and Germany in 2010, but the plane made its first test flight only last month. Both countries will now have to wait several years more, according to the German Defense Ministry faxless cash advance.

Germany, however, has little room to maneuver. With 4,300 German troops based in northern Afghanistan, Berlin needs access to such aircraft for transporting not only troops but also such heavy equipment as tanks, armored personnel carriers and helicopters.

Without the A400M, it must either modernize at huge expense its Transall aircraft, which are more than 30 years old, or lease Russian Antonov aircraft.

“We want the A400M but not at any price,” the German defense minister, Karl-Theodor zu Guttenberg, reiterated during an interview with the Bayernkurier newspaper to be published Saturday. “Our willingness to compromise has its limits.”

Britain, too, is furious about the delays, especially given its big role in Afghanistan.

The German Defense Ministry official said that cost was not the only issue still on the table, but range and payload as well. The A400M is currently several tons over its specified weight.

An audit of the A400M program by PricewaterhouseCoopers, which was commissioned last year by the governments, has blamed a significant portion of the cost over-runs on EADS and Airbus for failing to put proper budget controls in place. It also said the manufacturer had consistently underestimated development costs.

The auditor’s report, which was leaked to several European media this past week, estimated that the A400M was roughly €7.6 billion over budget.

EADS and Airbus have rejected the findings of the audit, but have so far failed to provide their own cost estimate for the program, now four years behind schedule.

EADS has already written off €2.4 billion in costs for a project that continues to expend cash at a rate of around €100 million each month.

The seven countries failed to meet an year-end 2009 deadline to agree on a new delivery schedule and financing arrangement for the contract, and last month set a new deadline of Jan. 31.

With the financial crisis and recession straining budgets across Europe, the governments have been reluctant to come up with more money.

Nicola Clark reported from Paris.

Pressure Mounts for Deal for Airbus Military Plane

Hot News: Geithner voiced concern on US bank limits-sources

Crude oil followed the stock market up on Tuesday, settling higher for the first time in five sessions.

Investors boosted health stocks, watching a Massachusetts election to fill the seat of the late Sen. Edward M. Kennedy. Some hoped for a Republican victory that would make it more difficult for Senate Democrats to pass a health care bill. The Dow Jones Industrial Average was up nearly 100 points in afternoon trading.

Wholesale gasoline prices also moved higher after the MasterCard SpendingPulse report for the week ended Friday showed gasoline consumption rose 3.2 percent with the week before and 2.3 percent from the same week a year ago. Traders have been looking for signs that gasoline demand is starting to pick up to justify oil prices that have more than doubled in the past year.

SpendingPulse is a division of MasterCard Advisors that tracks total sales paid for by credit card, checks and cash.

But last week’s falling oil prices started to bring down prices at the gas pump. Gasoline prices fell for the fourth straight day, though the declines have been modest so far.

Prices of $2.74 per gallon Tuesday were less than 2 pennies under the 15-month peak of $2.7543 hit on Thursday, according to AAA, Wright Express and Oil Price Information Service.

Prices still are up 15 cents in the past month and 89.8 cents from a year ago, as motorists dig deeper into their wallets to pay for fuel just as Christmas bills start to come in payday loans with low fees.

Tuesday’s gasoline prices matched the Energy Information Administration survey that showed prices averaged $2.739 per gallon nationwide Monday, down 1.2 cents from the week before.

A typical motorist using about 50 gallons a month is paying about $140 for gasoline, $45 more a month than a year ago.

Gasoline prices have spiked in the past month on a jump in oil prices.

Analyst Tom Kloza said to look for larger declines in gasoline prices over the next few weeks. January and February are typically a period of poor demand for transportation fuels.

Benchmark crude for February delivery rose $1.02 to settle at $79.02 Tuesday on the New York Mercantile Exchange.

In other Nymex trading in February contracts, heating oil fell 0.06 cent to settle at $2.0454 a gallon, while gasoline added 1.37 cents to settle at $2.0591 a gallon. Natural gas futures shed 13.4 cents to settle at $5.557 per 1,000 cubic feet.

In London, Brent crude for March delivery rose 53 cents to settle at $77.63 a barrel on the ICE Futures exchange.

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Associates Press writers Pablo Gorondi in Budapest and Eileen Ng in Kuala Lumpur, Malaysia, contributed to this report.

Crude settles higher as stocks climb

TULSA, Okla. – Williams Cos. said Tuesday it will create one of the largest natural gas partnerships in the nation by combining its pipeline and processing units.

The deal provides Williams with more money to explore for natural gas. Many energy companies are manuevering to get a bigger portion of the huge natural gas reserves in the U.S. that have been discovered due to advances in drilling technology.

The deal is worth about $10 billion plus $2 billion in debt. Williams, based in Tulsa, Okla., will get about $3.5 billion in cash from Williams Partners, its natural gas processing company. It will also receive 203 million units of the partnership and its stake from 24 percent to 80 percent.

The restucturing will also allow the company to borrow money more easily.

Williams is one of the biggest natural gas operations in the U faxless pay day loans.S., producing enough gas for more than 4 million homes per day and transporting about 12 percent of the nation’s daily supply of natural gas. One its most important assets is the Texas Transcontinental Gas pipeline, which carries gas from the Gulf Coast to New Jersey and New York City as well as the Northwest.

Shares of Williams rose $1.73, or 8.1 percent, to close at $23.10. Earlier, shares reached a 52-week high of $23.76. Williams Partners shares shot up $5.60, or 18.2 percent, to $36.39, and hit a 52-week high of $36.40. Williams Pipeline Partners shares gained $3.84, or 16.5 percent, at $27.19. The shares hit $27.25 during the session, their highest price over the past year.

Williams creates giant natural gas partnership

European stock markets rose Monday as speculation of a pickup in corporate deal making kept investors interested on a day Wall Street was closed for the Martin Luther King public holiday and Greece’s budgetary woes continued to weigh on the euro.

The FTSE 100 in London closed up 39.02 points, or 0.7 percent, at 5,494.39, while DAX in Frankfurt rose 42.58 points, or 0.7 percent, at 5,918.55. The CAC-40 in Paris ended 23.08 points, or 0.6 percent, higher at 3,977.46.

Earlier in Asia, Japan’s Nikkei 225 stock average ended 127.02 points, or 1.2 percent, lower at 10,855.08 while Hong Kong’s Hang Seng fell 194.15 points, or 0.9 percent, to 21,460.01. Markets in Singapore and Taiwan also lost ground.

A lot of the interest in Europe centered on International Power of Britain and Gaz de France and whether weekend speculation that they were looking at some sort of tie-up would materialize.

However, International Power’s statement that merger talks had ended saw a massive reverse in the company’s fortunes and a share price that had been 8 percent higher in the day ended over 3 percent lower — making it the biggest faller on the FTSE 100.

The British candy maker Cadbury also remained in the spotlight amid speculation that its suitor Kraft Foods was preparing to sweeten its offer before a Tuesday deadline. Cadbury ended around 1.5 percent higher but investors remain skeptical that the current stand-off between the two companies can be ended.

“Some traders seem to feel that this has dragged on long enough, making any sort of deal unlikely,” said David Jones, chief market strategist at IG Index.

Even though talks between International Power and Gaz de France failed to yield anything, analysts said there are expectations that the amount of mergers and acquisitions taking place will increase over the coming months as the global economy recovers from recession. One corollary of increased confidence is an increase in mergers and acquisitions.

When Wall Street returns on Tuesday, the focus will turn towards the next batch of fourth quarter corporate earnings — so far, earnings have been fairly mixed, with upside surprises from the likes of the chipmaker Intel offset by disappointments elsewhere, most notably the aluminum Alcoa Inc free instant credit report.

Banks will be in the spotlight especially after U.S. stocks fell 1 percent on Friday — the Dow Jones industrial average suffered its worst day of the year so far — as JP Morgan Chase & Company offered a cautious earnings guidance even though it reported a fairly strong set of results.

“We get Citigroup tomorrow which has less of the good bits of banking and more of the bad bits,” said Kit Juckes, chief economist at the ECU Group.

A meeting of the 16 finance ministers of the countries that use the euro in Brussels later will be closely monitored in the currency markets as the main topic of debate will be the shaky state of Greece’s public finances.

Concern about Greece’s debts has been one of the reasons why the euro has floundered over the last month or so from 16-month highs above $1.50. Earlier it hit a ten-day low of $1.4336 before recovering slightly to $1.4380.

Greece’s problems have fueled concerns that the country may eventually have to be bailed out by its partners in the eurozone. Some observers are even speculating about a possible Greek exit from the single currency zone.

“With rising concerns about the workability of the Greek government’s stability and growth plan, the firm rejection from within the eurozone of the idea of a bailout, the rapidly rising cost of default insurance on Greek sovereign debt and concerns over deficits elsewhere in the region, the problems for the single currency are mounting rapidly,” said Neil Mellor, a currency strategist at Bank of New York Mellon.

Europe Markets Rise Amid Rumors on Deals

NEW YORK (Reuters) – Profits from top U.S. technology companies like IBM (IBM.N) and financial companies like Goldman Sachs Group Inc (GS.N) next week could help stocks gain as long as investors see room for more profit growth.

Stronger-than-expected results late Thursday from tech bellwether Intel Corp (INTC.O) failed to excite investors on Friday, while steep loan losses reported by JPMorgan Chase & Co. (JPM.N) dragged down the market.

The benchmark Standard & Poor's 500 index (.SPX) rose 23.5 percent last year, with information technology the top-performing sector. It jumped 60 percent, raising questions about whether the sector may have become too expensive.

"It's all about how fast they can grow earnings to catch up to those valuations," said Jeff Kleintop, chief market strategist at LPL Financial in Boston.

"This is a business spending-led recovery rather than consumer recovery … so I think earnings growth will remain above average and justify those valuations."

Fourth-quarter results are expected to show a sharp improvement compared with 2008's last quarter, when the economic downturn took a heavy toll on corporate profits.

S&P 500 earnings for the quarter are forecast up 186 percent versus a year ago, according to Thomson Reuters estimates. It would be the first quarter that S&P 500 company earnings grew year over year since the second quarter of 2007.

Next week the earnings period accelerates, with some 57 S&P 500 companies reporting.

International Business Machines Corp is scheduled to post results on Tuesday while Google Inc (GOOG.O) is expected on Thursday. Among financials, Goldman Sachs is expected on Thursday, while Bank of America (BAC.N) and Morgan Stanley (MS.N) should report on Wednesday.

STOCKS END DOWN FOR WEEK

For the second week of the new year, the three major indexes lost ground. The Dow Jones industrial average (.DJI) was down 0.1 percent, while the S&P was down 0.8 percent and Nasdaq (.IXIC) was down 1.3 percent.

The S&P 500 is still up 68 percent since its early March lows, largely because of stronger-than-expected earnings and economic data.

On the economic front, data that could influence stocks next week includes reports on housing starts, producer prices and leading indicators easy payday loans.

Data on December housing starts, expected on Wednesday, is forecast to show 580,000 new units from 574,000 in November.

More than 70 percent of companies beat estimates in recent reporting periods, and investors are eager to see if the fourth-quarter will produce similar results. The last quarter of 2008 was the worst earnings period in the history of the index.

"I think we're going to get decent numbers relative to estimates," said Fred Dickson, market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon.

"Valuations have gone up, but so have earnings."

Intel, which fell 3.2 percent to $20.80 on Friday, "had such a good run on the margin front that I think a lot of people are a little bit leery that there's going to be any further improvement in margins," said Owen Fitzpatrick, head of U.S. Equity Group, Deutsche Bank Private Wealth Management, said.

FINANCIALS KEY TO MARKET

IBM shares have risen almost 60 percent in the past year as the company cut costs and changed its business mix. Analysts expect the company to report fourth-quarter revenue of about $27 billion, about even with a year earlier, and profit per share of $3.47 versus $3.27 a year earlier.

Financials, which were up 14.8 percent as an S&P sector last year, could benefit from gains in investment banking and other factors, Kleintop said.

"Financials still remain the sore spot in the market. If financials are going down, the whole market is going down," he said.

Financials, materials and consumer discretionary companies are expected to have the highest earnings growth for the fourth quarter, Thomson Reuters estimates showed. Energy and industrials are expected to have the lowest.

Also set to report next week: General Electric (GE.N), McDonald's Corp (MCD.N) and American Express Co (AXP.N).

(Editing by Kenneth Barry)

Earnings growth takes center stage

LONDON (MarketWatch) — European shares traded lower on Friday with investors cautious after a mixed start to the U.S. fourth-quarter earnings season.

The pan-European Dow Jones Stoxx 600 index traded down 0.6% at 257.39.

“Overall, the market has been strong since the beginning of the year and I think that we could see a bit of profit-taking,” said Stephen Taylor, strategist at Dolmen Stockbrokers.

European banks came under pressure after the release of fourth-quarter earnings from U.S. banking giant J.P. Morgan, with Societe Generale shares down 2.9%, Deutsche Bank shares down 3.7% and Barclays shares down 2.2%.

J.P. Morgan reported that it earned more than analysts expected in the fourth quarter, but its credit costs remained high and it set aside nearly $2 billion to cover consumer-loan losses. Read more on J.P, Morgan results.

“There’s still a lot of risk with financials; their balance sheets are complicated,” said Taylor.

The German DAX index declined 2% to 5,872.96, the French CAC-40 index moved down 1.3% at 3,964.34 and the U.K. FTSE 100 index fell 0.6% to 5,466.05.

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Asian stocks ended broadly higher. U.S. stocks retreated. Shares rose on Wall Street Thursday ahead of results out from Intel Corp., .

The world’s biggest chipmaker posted a jump in fourth-quarter profit and topped Wall Street estimates after higher sales for PC processors. See full story.

Carrefour , Europe’s largest retailer, rose 3.7%, after it reported late on Thursday a 1% rise in fourth-quarter sales to 25.99 billion euros. Latin American sales growth offset a stagnant performance in its home market of France.

Carrefour, which twice lowered its earnings outlook for the year, estimates operating profit of 2 free business cards.78 billion euros, down from 3.3 billion euros in 2008 but above its previous estimate of the “bottom end of the 2.7 billion euro to 2.8 billion euro range.” Read more on Carrefour.

Back with earnings-related decliners, shares of Man Group fell 6.1% in London after it said that its funds under management declined around 4% to $42.4 billion at the end of December after redemptions from institutional investors and a negative performance from its AHL fund. Read Man Group story.

Business-software giant SAP fell 3.2% after it was downgraded to equal weight at Morgan Stanley. The brokerage said the German software giant will want to re-energize its top line through more investment.

Vodafone Group shares were down 1.4%.

The wireless telecom giant’s Verizon Wireless venture with Verizon Communications lowered its basic wireless service fee by about $29 a month on Friday. Read more on Verizon Wireless move.

Autos were also lower, with Renault down 3% and BMW shares down 1.2%..

Taylor at Dolmen said he’s cautious on companies that sell relatively high-priced consumer products. “They had a good rally last year, but I think that they may underperform,” he said.

And QinetiQ shares dropped nearly 12%. The U.K. defense and intelligence group said orders from the U.K. and U.S. governments have been delayed, so the normally seasonally strong second half won’t occur. Its second-half performance is seen broadly similar to the first. Read more on order delay.

However, media stocks were higher, with newspaper publisher Daily Mail and General Trust up 5.5% on the London Stock Exchange after upgrades at UBS and Credit Suisse.

In addition, Pearson shares were up 1.4% after the publisher of the Financial Times said that its majority-owned unit, Interactive Data Corp., is mulling strategic options.

Europe Markets: Europe shares lower after mixed earnings

NEW YORK (Reuters) – Billionaire investor Wilbur Ross on Thursday said he was not considering buying American International Group's (AIG.N) mortgage insurance unit United Guaranty.

"It is certainly the case that we're not buying the division," Ross said in an interview with Reuters Insider. "We do think the mortgage insurance space is an interesting one and we hope to be in it at some point, but we have no transaction right now."

Ross, chairman and chief executive of private equity and turnaround firm WL Ross & Co, said the firm's latest fund was around 60 percent invested, and he expects it to be fully invested long before the end of the year payday cash loan.

Ross also said he was "quite possibly" interested in teaming up with Richard Branson's Virgin Money to bid for state-owned British bank Northern Rock.

Ross was part of a group led by Virgin that bid for Northern Rock in 2008.

(Reporting by Michael Erman, editing by Maureen Bavdek)

Investor Wilbur Ross not buying AIG unit

Hot News: Fed makes the case for keeping its power intact

NEW YORK (Reuters) – U.S. mortgage applications rose during the first week of 2010, reflecting a surge in demand for home refinancing loans as interest rates dropped, data from an industry group showed on Wednesday.

Demand for loans to purchase a home, however, only rose marginally. A continuation of this trend would not bode well for the U.S. housing market, which has been showing signs of stabilization, but remains highly vulnerable to setbacks.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended January 8 increased 14.3 percent to 528.1. The index, however, pales in comparison to its year-earlier level of 1,324.8.

The four-week moving average of mortgage applications, which smoothes the volatile weekly figures, was down 6.4 percent.

The lowest mortgage rates in decades and high affordability helped the hard-hit U.S. housing market find some footing in 2009 after a three-year slump.

Anthony Hsieh, founder and CEO of loanDepot.com, a mortgage lender based in Irvine, California and currently licensed in 18 states, said tight lending standards are one of the sector's biggest obstacles right now.

"I have been in the mortgage business for the past 25 years and I have never seen the industry as tight as it is today."

"Once a borrower leaps over one hurdle in the loan application process they face yet another hurdle, so it is as if they are participating in some sort of triathlon," he said.

The MBA's seasonally adjusted purchase index, a tentative early indicator of home sales, rose 0.8 percent to 213.7.

The seasonally adjusted index of refinancing applications increased 21.8 percent to 2,407.2.

The MBA said borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 5.13 percent, down 0.05 percentage point from the previous week no teletrack payday loan. The prior week's rate was the highest rate since late August.

Interest rates, however, were above the year-ago level of 4.89 percent and an all-time low of 4.61 percent set in the week ended March 27, 2009. The survey has been conducted weekly since 1990.

The refinance share of mortgage activity increased to 71.5 percent of total applications from 68.2 percent the previous week. The adjustable-rate mortgage, or ARM, share of activity was unchanged at 4.0 percent from the previous week.

Cameron Findlay, chief economist at LendingTree.com in Charlotte, North Carolina, said mortgage rates should rise sharply this year, reaching 6.20 percent in the fourth quarter.

"A rate at or over 6 pct is above my tolerance level."

"The housing market cannot afford to go beyond that level and I am convinced the Fed will take action to bring rates back down if they do," he said.

Interest rates are expected to rise when the Federal Reserve at the end of March stops buying mortgage-related securities. The Fed's agency MBS and agency debt purchase programs, aimed at lowering borrowing costs, will have reached more than $1.4 trillion.

U.S. residential mortgage originations will plunge 40 percent this year to the lowest level in a decade as home refinancing demand sinks with rising mortgage rates, the Mortgage Bankers Association said in its annual forecast on Tuesday.

Renowned Yale University economist Robert Shiller said on Tuesday he sees U.S. housing prices falling further in coming months, fueling more fears about the broader economy.

The MBA said fixed 15-year mortgage rates averaged 4.45 percent, down from 4.62 percent the previous week. Rates on one-year ARMs increased to 6.83 percent from 6.42 percent.

U.S. home refinancing demand soars first week of 2010

McDonald’s, the fast-food company, said on Monday that it had promoted Don Thompson, the head of its United States division, to become its No. 2 executive.

Mr. Thompson succeeds Ralph Alvarez, who retired unexpectedly last month, citing health concerns. Like Mr. Alvarez, Mr. Thompson will have the dual titles of president and chief operating officer.

He becomes the third person to hold the No. 2 post at McDonald’s since 2004, when the company lost two chief executives to fatal illnesses. Since then the company has stressed the importance of succession planning, and the No. 2 executive has been widely viewed as a chief executive in waiting.

James A. Skinner, the chief executive, said Mr. Thompson would oversee operations at McDonald’s nearly 32,000 restaurants worldwide. The company operates in more than 117 countries.

Despite the importance of its international markets — revenue from outside the United States made up nearly two-thirds of the company’s total of $23.5 billion in 2008 — a company press release and profile of Mr. Thompson showed little evidence of foreign experience.

Walt Riker, a company spokesman, said that Mr. Thompson had worked with the company’s international restaurants when he was executive vice president of restaurant systems in 2004, a job that included involvement with such things as modernized drive-throughs, new cooking systems, cashless payment systems and new menu items.

McDonald’s has a long history of choosing its top executives from within unsecured personal loans.

Mr. Thompson, 46, started working at McDonald’s in 1990 as an electrical engineer in the restaurant systems group. He then moved into restaurant operations and rose to executive posts in its West and Midwest divisions. In 2006 he was named president of the company’s United States division, when Mr. Alvarez was promoted from that post to the No. 2 spot.

Mr. Alvarez’s predecessor, Michael J. Roberts, also left the company abruptly, reportedly over frustrations that Mr. Skinner, who became chief executive in 2004, had failed to step down as quickly as anticipated.

McDonald’s has been a success story during the global recession, reporting strong sales and generally outperforming its fast-food rivals. Possible signs of weakness began to show in the United States business late last year, however. Same-store sales in the United States for the month of November were down 0.6 percent compared with the same period the previous year, the company reported. But year-to-date same-store sales for the period that ended Nov. 30 were up 2.8 percent in the United States and 3.9 percent companywide.

The company also announced on Monday that Jan Fields would succeed Mr. Thompson as president of its United States division. Ms. Fields had previously been the executive vice president in the division.

McDonald’s Names U.S. Chief as Its No. 2 Executive

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