Bank of England policy makers will maintain the size of their bond-buying program next week amid a split over whether the economy needs more stimulus, economists forecast.
The nine-member Monetary Policy Committee led by Governor Mervyn King will hold the target at 325 billion pounds ($521 billion) on April 5, according to all 39 economists in a Bloomberg News survey. They will also leave their key interest rate at a record low of 0.5 percent, said all 53 economists in a separate poll.
Divisions have emerged as a surge in oil prices threatens to stoke an inflation rate now in its third year above target while Europe
European markets recovered some ground Friday, after sharp losses this week, as finance ministers from the 17 euro countries discussed whether to increase the amount of resources at their disposal for future bailouts.
Though the target of (EURO)1 trillion ($1.3 trillion) requested by a number of international institutions, as well as the U.S. and China, is unlikely to be met, it appeared the ministers would agree to increase the firewall to around (EURO)800 billion.
Some (EURO)300 billion ($398 billion) of that has already been spent in the bailouts of Greece, Ireland and Portugal, meaning (EURO)500 million would be left to fund new rescue packages.
Germany, the eurozone’s largest economy and the biggest contributor to the bailout funds, has signaled it would agree to such a proposal.
“The hope is that Germany will soften its stance and allow the various bailout funds to be enlarged, providing more firepower to combat the crisis,” said Chris Beauchamp, market analyst at IG Index.
Many in the markets see increasing the firewall as a sure step in dampening down the debt crisis, which has crippled the eurozone for the past couple of years. The fear is that the euro bloc just won’t have enough resources to help out Spain and Italy, should they need outside help.
Worries that Spain will be dragged into the debt crisis mire has weighed on markets this week. The new Spanish government is expected to unveil a tough budget later as it attempts to get the deficit down to levels sanctioned by its partners.
Even if a deal to increase the bailout resources is approved at the euro meeting in Copenhagen, Denmark, there are many doubts over whether Italy or Spain, the eurozone’s third and fourth largest economies could be saved if the markets lose confidence.
“The reality is that the firewall is likely to be both underwhelming and insufficient to deal with potential problems in Spain and Italy,” said Neil MacKinnon, global macro strategist at VTB Capital pay day loans.
For now, European stocks have recovered some of their losses this week. Germany’s DAX was up 0.8 percent at 6,931 while the CAC-40 in France rose 0.9 percent to 3,413. The FTSE 100 index of leading British shares was up 0.5 percent to 5,769.
Wall Street was poised for a solid opening too, with both Dow futures and the broader S&P 500 futures up 0.3 percent.
The euro was also 0.3 percent higher at $1.337, supported by figures showing inflation in the eurozone in March only fell to 2.6 percent from the previous month’s 2.7 percent. The market consensus had been for a fall to 2.5 percent.
Earlier in Asia, sentiment in stock markets was hurt by news that Japan’s factory production fell a worse-than-expected 1.2 percent in February _ its first decline in three months _ as demand for exports weakened. The Nikkei 225 index in Tokyo fell 0.3 percent to close at 10,083.56.
Hong Kong’s Hang Seng fell 0.3 percent to 20,555.58, while mainland Chinese shares were mixed. The benchmark Shanghai Composite Index gained 0.5 percent to 2,262.79 while the Shenzhen Composite Index lost 0.4 percent to 891.84.
Oil prices bounced back alongside equities _ benchmark oil for May delivery was up 32 cents to $103.12 per barrel in electronic trading on the New York Mercantile Exchange. On Thursday, the contract plunged $2.63 to $102.78 after French Prime Minister Francois Fillon said there’s a “good chance” that the U.S. and Europe will agree to release some of their oil reserves.
____
Pamela Sampson in Bangkok contributed to this report.
BATS Global Markets says it will replace Joe Ratterman as chairman of the board, even as the company’s directors expressed support for him as chief executive.
The announcement Tuesday came after technical difficulties derailed the exchange operator’s initial public offering last week.
BATS operates electronic markets for stocks and stock options in the United States and Europe. The Kansas-based company is a leading platform for high-frequency, computer-driven trading.
In a brief statement, BATS directors said Ratterman "continues to do a tremendous job as CEO of BATS."
"We fully support his leadership, vision and strategic direction as BATS continues to enhance competition and foster innovation in markets worldwide," the statement said.
But the directors still voted to replace Ratterman as chairman under "an enhanced corporate governance structure."
Ratterman, who has been the company’s chairman since 2007, will hold the position until a replacement is named, the directors said cash advance.
The hottest tech of 2015 and beyond
BATS officially withdrew its IPO late Friday after it was forced to halt trading in its own stock and others because the company’s technology malfunctioned.
Ratterman publicly apologized for the problem, saying in a letter to customers that the company’s failure to perform "has no excuses."
BATS is third largest exchange operator in the United States after NYSE Euronext (, Fortune 500), which operates the New York Stock Exchange, and the NASDAQ OMX Group. ()
The company said this week that its troubles have not impacted its market share.
As of Monday, BATS boasted a 10.3% share of the U.S. equities market and a 25.4% share of the European market.
Hamburg, Europe
The Federal Reserve
The Senate on Thursday passed a bill making it easier for more companies to become publicly traded by bypassing audits and disclosures now required for investors.
The Senate voted 73-to-26 to pass the House version of the bill with one small change intended to help protect investors. Because of the change, the bill returns to the House.
"The bill is far from perfect, but it’s a good bill," said Senate Majority Leader Harry Reid. "It’ll help capital formation."
House Majority Leader Eric Cantor indicated support for the Senate change and promised quick passage of the bill, meaning it could arrive on President Obama’s desk next week.
Earlier this month, the House overwhelmingly passed the measure that rolls back some rules the Securities and Exchange Commission enforces on small and medium companies attempting to make an initial public offering.
The measure sparked concerned letters from investor groups, unions, consumer groups and even the head of the SEC. All of them said the bill could open the door for more failed IPOs and investor fraud.
In a letter last week, SEC Chairman Mary Schapiro asked lawmakers for changes, saying "too often, investors are the target of fraudulent schemes disguised as investment opportunities."
The bill would relax SEC rules for small and medium-sized companies with less than $1 billion in gross revenue seeking to go public. The measure gives them up to five years, or until revenue tops $1 billion, to supply an independent audit and certain investor disclosures.
Critics said $1 billion is too high a threshold — some 80% of firms going public would be able to bypass disclosures.
It would also make it easier for companies with as many as 2,000 shareholders to avoid registering with regulators.
The bill would also exempt firms from nonbinding shareholder votes on executive pay and benefits packages, which just came as part of the Wall Street reform law paperless payday loans. In the aftermath of the financial crisis, the law made it tougher for CEOs to reap bonuses tied to soaring stock prices — particularly when the company is over-leveraged and making risky bets.
Stocks: Retail investors ‘not in the game yet’
Critics, including the Council of Institutional Investors, said that easing the rules applied to far too many companies and could make investors wary of investing in them.
"A company (with $1 billion in revenues) has the resources to comply with disclosures," said Jeff Mahoney, general counsel to the Council of Institutional Investors.
The bill would also allow companies to solicit investors — including the use of advertisements — when going public, which is currently prohibited. And it would allow them to raise money from larger numbers of small, less sophisticated investors.
Barbara Roper of the Consumer Federation of America warned the provision would make it easier for companies to take advantage of seniors, luring them to sink their retirement savings into an IPO.
"A retiree who has that nest egg isn’t necessarily a sophisticated investor and shouldn’t be speculating on private offerings," Roper said.
The bill would also allow what’s called "crowd funding," allowing firms to bypass regulations to raise money from large pools of small investors by directly soliciting them over the Internet. Critics are concerned about the potential for fraud.
The only change that the Senate added was to require that those working as an intermediary to such crowd funding register with regulators.
– CNN’s Ted Barrett contributed to this story.
Anonymous and other "hacktivist" groups rose to new prominence in the cybercrime universe last year, and a new report shows that they made some serious mischief.
Verizon’s (, Fortune 500) annual Data Breach Investigations Report, released Thursday, found that hacktivist groups were responsible for 58% of all data stolen last year. The telecom giant compiled data breach information from its customers and from law enforcement agencies in five countries.
The hacktivists’ success is partially due to the sharp rise in the number of attacks Anonymous and its peers launched last year. Verizon, which has been tracking hacktivist activity since 2004, said that last year’s collection of hacktivist breaches exceeded the total from all previous years combined.
That trend is "probably the biggest and single most important change" in this year’s report, said Bryan Sartin, head of Verizon’s data breach investigations team.
When online hacktivism first started in the 1990s, most of what the attackers accomplished were website defacements and denial of service attacks — annoyances more than serious problems.
How they hack you
But last year, Verizon began to notice what it calls a "major shift" in hacktivist activity. In addition to their usual methods, Anonymous and its cohorts were starting to launch data breach attempts against their targets, in what became a new "core tactic" for the groups.
"2011 saw a merger between those classic misdeeds and a new ‘oh by the way, we’re gonna steal all your data too’ twist," Verizon said in its report. "This re-imagined and re-invigorated specter of ‘hacktivism’ rose to haunt organizations around the world."
Here’s a startling twist: Verizon found that in many cases the denial of service attacks served as diversions. The hacktivists would often publicly announce a big attack, and the target would dedicate all of its resources to stopping that. While that was happening, hacktivists would go in unnoticed and steal some company data.
"It’s the old bait-and-switch," said Sartin. "That concept, as basic as it seems, is a level of ingenuity we’ve never seen before."
In all, hacktivist groups stole more than 100 million records last year, almost twice the amount of data captured by financially motivated cybercriminals payday loans with no fax.
Still, just 2% of all attacks could be attributed to Anonymous and its peers. The vast majority of online data thieves remain professional criminals looking to steal information that can lead to money.
The cost of cybercrime
So why did hacktivists manage to grab so much more data than the pros?
Those big-time cybercriminals — typically organized crime rings — are usually surgical in their attacks. They take a "rinse and repeat" approach, stealing small chunks of data on a massive scale.
Hacktivists, on the other hand, go after big organizations, since their goal is to get the public to notice them. Some prime targets of Anonymous and other hacktivists last year included News Corp. (), Sony (), PBS, the Federal Bureau of Investigation, Central Intelligence Agency, Department of Justice, and a multitude of security firms.
The "good" news is that most of what hacktivists stole was relatively benign data. Customer lists of names, usernames and e-mail addresses were the most commonly grabbed data. Hackers were rarely able to capture — or perhaps didn’t go after — more sensitive data like credit card information or passwords.
But it wasn’t all "protest and lulz," Verizon said. Sartin now thinks that hacktivists are a more significant threat than previously believed.
Fighting the cyber Mafia
"The numbers suggest clearly that people need to reevaluate how they view the capabilities of hacktivists," he said. "The tools, tactics and methods of advanced persistent threats and hacktivists are largely the same."
Traditional cybercriminals are also upping their game.
Cybercriminals last year went after end-user devices like ATMs, laptops and smartphones much more often than they did in previous years. Those devices accounted for 60% of all attacked targets, and Sartin said he wouldn’t be surprised if smartphones make up the majority in 2012.
In all, Verizon said it and its partners recorded 855 data breaches, encompassing 174 million compromised records. That represented the second-highest total since Verizon’s report was first issued in 2004.
Thailand kept its key interest rate unchanged, pausing after two reductions as it raised its forecast for economic growth this year and predicted inflation pressure may increase. Stocks and the baht rose.
The Bank of Thailand held its benchmark one-day bond repurchase rate at 3 percent, it said in Bangkok today, a decision predicted by 19 of 21 economists in a Bloomberg News survey. The other two forecast a 0.25 percentage-point cut.
Central banks from Australia to South Korea refrained from cutting rates this month as higher energy costs boosted inflation risks, reducing the scope for monetary stimulus to counter a Chinese slowdown and Europe
U.S. stocks rose slightly Monday in a ho-hum opening after their best week of the year.
The Dow Jones industrial average spent most of the morning in the red, then climbed to 13,247, up 15 points. The Standard & Poor’s 500 and Nasdaq composite fell in the early minutes of trading but then rose. The S&P 500 was up five points to 1,410, and the Nasdaq was up 18 to 3,074.
Last week, the Dow and S&P 500 rose 2.4 percent apiece, their best showing of the year. For the first time, the Dow closed above 13,000 and the Nasdaq above 3,000 on the same day.
In the absence of any major economic news, the markets latched on to announcements from a few well-known companies.
Apple rose about 2 percent to $595.88 after announcing that it would pay a shareholder dividend and buy back $10 billion of its stock over three years. The stock hit an all-time high of $600.01 last week.
The dividend is expected to expand the company’s shareholder reach because value-oriented mutual funds that focus on dividends will buy it. Apple’s stock has already risen from $405 this year, partly in anticipation of the dividend.
UPS rose 4 percent after announcing it would buy TNT Express, the second-largest express mail company in Europe, further cementing UPS’ status as the world’s largest delivery company.
Citigroup rose 4 percent after announcing it had sold its share in a Shanghai bank for $668 million. The move should help the bank establish its own businesses in China. The bank is slimming down to try to shake off the vestiges of the financial crisis.
Sprint Nextel fell 5 percent after a Sanford C. Bernstein analyst downgraded the stock to underperform and predicted that future incarnations of the iPhone will not work too well with the Sprint network. The analyst, Craig Moffett, also expressed concern about the company’s heavy debt burden.
There was little in the way of major economic indicators. The National Association of Home Builders index of builder confidence came in unchanged from the previous month.
“There’s not really a lot to say,” said Stephen Carl, head equity trader at Williams Capital Group. “I guess we could just toss a coin in the air and see which way it goes.”
Prices for U.S. Treasury debt slid for the ninth day in a row, and the yield on the 10-year Treasury note hit 2.32 percent, the highest since October. Investors feeling more confident in the economy are putting their money in riskier assets like stocks.
European markets were mixed. The main stock indexes fell less than 1 percent in France, Britain and Germany. Stocks rose 1.7 percent in Greece and 0.7 percent in Spain.
Though Greece’s debt crisis has faded from the spotlight, Greece remains in deep recession, and uncertainty lingers. Unions throughout Europe are protesting cuts in benefits, making it difficult for governments to rein in their spending.
Leadership questions are also bubbling up, with the Greek finance minister stepping down to run the majority Socialist party and France gearing up for presidential elections.
At a conference Sunday in Beijing, International Monetary Fund chief Christine Lagarde said that European leaders need to stay vigilant about debt.
“The world economy has stepped back from the brink, and we have causes to be a little bit more optimistic,” she said. “But optimism should not give us a sense of comfort and certainly should not lull us into a false sense of security.”
The price of oil continued to rise, climbing to $107.70, up 63 cents. The average price for a gallon of regular gasoline rose a penny over the weekend to $3.84 and is up 30 cents in a month, pushed higher by tension in Europe over Iran’s nuclear program..
International Monetary Fund Managing Director Christine Lagarde urged policy makers to be vigilant as oil prices, debt levels, and the risk of slowing growth in emerging markets threaten global economic stability.
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