InvestMacro Forex News

London Gold Market Report
from Ben Traynor
BullionVault
Thursday 21 March 2013, 08:00 EST

THE DOLLAR gold price hovered just below $1610 an ounce Thursday morning, while stocks and commodities fell along with Euro as disappointing economic data was added to news that Cyprus’s banks will remain closed until next Tuesday.

“We forecast the gold price to have dropped to below $1400 by year-end and for it to continue to trend lower next year,” says a note from Societe Generale.

SocGen has cut its average gold price forecast for this year to $1500 an ounce, with the per ounce averages for 2014 and 2015 cut to $1400 and $1300 respectively.

Commerzbank by contrast continues to see record gold prices ahead, but has also cut its 2013 forecast.

“[We] expect the price to rise to only $1800 per troy ounce by year-end [and] we now believe the price target of $2000 per troy ounce we previously forecast for the end of this year will only be reached in the course of next year,” the bank says.

Gold in Sterling meantime edged lower this morning, dipping below £1060 an ounce as the Pound gained against the Dollar following stronger-than-expected UK retail sales data. A day earlier, the US Federal Reserve left interest rates on hold at its latest meeting and confirmed it will continue with $85 billion a month of quantitative easing asset purchases.

Gold in Euros rose towards €1250 an ounce but failed to breach that level before easing back, as the Euro dipped briefly below $1.29.

Cyprus must agree a bailout plan by Monday, the European Central Bank said today, or else the ECB will cut off emergency liquidity funding to the island’s banks.

“Thereafter, Emergency Liquidity Assistance (ELA) could only be considered if an EU/IMF program is in place that would ensure the solvency of the concerned banks,” says a statement from the ECB’s Governing Council.

Russian president Dmitry Medvedev meantime has told European Commission officials that any solution to the Cypriot crisis should be found “with the participation of all interested parties, including Russian structures”.

The original EU-IMF bailout proposal included levies on deposits with Cypriot banks, many of which have been made by Russian nationals. Cypriot lawmakers rejected the idea of levies in a parliamentary vote held Tuesday.

“It is now up to the Cypriot authorities to come up with proposals,” Jeroen Dijsselbloem, head of the Eurogroup of single currency finance ministers, told the European Parliament Thursday.

Elsewhere in Europe, the Euro fell against the Dollar this morning after preliminary purchasing managers’ index data indicated economic conditions in the Eurozone have diminished by more than expected this month.

For the Eurozone as a whole, PMIs show contraction in both service and manufacturing sectors. German manufacturing has also declined, the flash PMI indicates, while service sector growth has slowed. The consensus forecast among analysts was for both German measures to rise slightly.

Over in India, the world’s biggest gold buying nation, demand for gold could rise for the first time in three years this year despite the government raising gold import duties to 6%, according to Somasundaram P.R., managing director at the World Gold Council for India.

One of India’s biggest gold lending firms meantime has seen its share price drop by a third this week after it said the fall in the gold price in recent years means the value of collateral may not be sufficient to cover interest owed on all loans.

Silver meantime traded sideways this morning at just below $29 an ounce.

Demand for silver “may be curbed” following the bankruptcy this week of China’s Suntech Power Holdings, the world’s biggest solar panel maker, according to a note from HSBC.

“The solar panel industry is burdened by overcapacity,” HSBC says.

“We estimate silver demand from the solar panel industry represents roughly 10% of silver industrial demand.”

A campaign in Switzerland aimed at preventing the sale of gold by the central bank has received enough signatures to force a referendum.

Politicians in Arizona meantime have proposed legislation that would make gold and silver coins legal tender, Bloomberg reports.

Ben Traynor

BullionVault

Gold value calculator   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics. Ben can be found on Google+

(c) BullionVault 2013

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

By www.CentralBankNews.info Here’s today’s Central Bank News link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don’t miss any important news.

By The Sizemore Letter

In the second half of the interview, Charles Sizemore discusses investing in the frontier markets of Africa, what the passing of Hugo Chavez means for Latin America, the bubble in farmland prices and more on Mike Robertson’s Straight Talk Money:

If you cannot view the embedded media player, please follow this link.

The post Charles Sizemore on Straight Talk Money, Part II appeared first on Sizemore Insights.

By The Sizemore Letter

Listen to Charles Sizemore talk about the Cyprus crisis and what it means for investors on Mike Robertson’s Straight Talk Money:

If you cannot view the embedded media player, please follow this link.

The post Charles Sizemore Discusses the Cyprus Crisis on Straight Talk Money appeared first on Sizemore Insights.

By WallStreetDaily.com

One month ago, almost to the day, I shared this little Wall Street fact of life: The pace of initial public offerings (IPOs) always follows the broader market.

So it should come as no surprise that, as the S&P 500 Index has already charged 9% higher this year, IPO activity is heating up, too.

This week alone, nine companies plan to go public.

Who cares? Well, you should. Because one of those companies happens to be Marin Software (MRIN).

In February, I singled out Marin as a possible “hot IPO,” thanks to its leverage to the mobile advertising boom. (Remember, mobile advertising spending is expected to surge from $3.2 billion last year to $20 billion by 2015.)

However, there was one big caveat: price.

Since overpaying for an IPO never makes investment sense – and Marin hadn’t provided a proposed pricing range yet – we couldn’t determine whether or not it represented a bargain.

But we can now. So let’s get to it before the company begins trading tomorrow.

Survey Says…

Later tonight, underwriters plan to price Marin’s IPO between $11 and $13 per share.

Is that a fair price range?

Normally, we could tell in a flash.

We’d simply pull up everyone’s favorite valuation metric – the trusty price-to-earnings ratio – for each of the company’s competitors and the broad market. Then we’d compare it to the IPO in question, based on its earnings per share.

In Marin’s case, however, it’s not that easy.

As I previously noted, much like every other small-cap, mobile advertising company – including Augme Technologies (AUGT), Millennial Media, Inc. (MM) and Velti Plc (VELT) – Marin isn’t profitable yet.

Given the infancy of the mobile advertising industry, though, we shouldn’t immediately shun these companies because of their lack of profitability as potential investments. I assure you, the growth and, in turn, profits are forthcoming.

Thankfully, we do have two alternative and meaningful valuation proxies that we can use to determine a fair price to pay for Marin.

More specifically, we can evaluate previous investments by venture capital firms and price-to-sales (P/S) ratios for similar companies.

~Valuation Proxy #1: Venture Capital Investments

In November 2012, Marin raised almost $20 million through a private placement with existing stockholders. Its official purchase price? $13.5312 per share.

And since Marin has increased its sales since November, it’s not a stretch to assume that the stock is more valuable as a result.

So, based on previous investments, the proposed range of $11 to $13 per share represents a modest bargain.

Granted, the venture capital firms’ average cost per share is actually lower than $13.53. That’s because they had invested in previous financing rounds (dating as far back as 2010) at lower prices (as low as $5.53 per share).

Nevertheless, if we get a chance to buy in at prices equal to their most recent investment, we should take it.

~Valuation Proxy #2: Price-to-Sales Ratios

The going P/S ratio for a mobile advertising firm is between 2 and 3. But that’s based on an extremely small sample size.

In a broader context, Marin is really a software-as-a-service (SaaS) company. And if we include those companies in our analysis – including salesforce.com (CRM), Guidewire (GWRE) and Workday (WDAY) – the range of P/S ratios checks in at 8 on the low end and 36 on the high end.

Now, I’m always a bit conservative when it comes to valuing an IPO.

Accordingly, let’s use a P/S ratio range of 8 to 10 for Marin. Doing so values shares at about $15.80 to $19.75. So, again, the proposed pricing range of $11 to $13 appears to be a bargain.

Granted, underwriters might be underpricing the deal to produce a one-day pop. They’ve been known to stack the deck, so to speak, to make their track record appear more impressive.

But that’s precisely why we’re completing our valuation analysis in advance of the stock’s debut. It’s the only way to remain rational with our purchasing decisions.

You see, if the IPO does, indeed, pop out of the gates, we know at what point the price becomes prohibitive.

As for most other investors, who usually don’t hear about an IPO until it begins trading – well, they’re left to their own devices (i.e. – human nature).

When they see a dramatic price run-up for an IPO, they often buy in, thinking it’s a momentum play that should be purchased at any price. And more often than not, such an investment “strategy” yields losses, not profits.

Bottom line: Based on previous venture capital investments, the explosive growth on the horizon for mobile advertising firms and prevailing price-to-sales ratios, Marin is a compelling investment for under $20 per share.

Ahead of the tape,

Louis Basenese

Article By WallStreetDaily.com

Original Article: Is This IPO Hopeful the Market’s Next Big Gainer?

By MoneyMorning.com.au

So did you heed my market warning from last week?

We’re only half way through the week and the stock market has fallen 3.5% from Friday’s close. This is exactly the set-up I discussed in my recent presentation. You can check it out here.

But as I said last week:

‘There comes a time in trading when you need to back yourself and stand firm in a view.

‘That moment has arrived for me.

‘After what has seemed like an eternity the ASX 200 has now done the work necessary and set itself up beautifully to catch many investors and traders with their pants down.

‘The long overdue correction in prices is very close.’

It’s still early days of course and we’ll still see buying pressure from the market in the short term. But the fact is the price action we saw early this week in the stock market is exactly what I needed to see to increase my conviction levels that the correction is on the way.

The catalyst for this was the news in Cyprus that the man in the street is now on the hook for the mistakes made by their banking overlords. There has been a mountain of commentary about this issue over the last few days and not much of it has been good. My favourite comment has been that Europe has ‘bazooka’d itself in the foot’.

If they’re pilfering money from people’s bank accounts to cover their losses it shows that their back really is against the wall.

Governments Trampling All Over The Property Rights

Personal property is the very cornerstone of a free society. It appears that we’re entering a new age where personal property is no longer respected by governments when it gets in the way of their plans.

John Adams stated it this way in the Massachusetts Declaration of Rights:

‘All men are born free and independent, and have certain natural, essential, and unalienable rights, among which may be reckoned the right of enjoying and defending their lives and liberties; that of acquiring, possessing, and protecting property; in fine, that of seeking and obtaining their safety and happiness.’

And as Thomas Jefferson said:

‘I believe…that a right to property is founded in our natural wants, in the means with which we are endowed to satisfy these wants, and the right to what we acquire by those means without violating the similar rights of other sensible beings; that no one has a right to obstruct another exercising his faculties innocently for the relief of sensibilities made a part of his nature…’

Outright theft of another’s private property in this way by a government is turning hundreds of years of progress of our civilisation on its head. That may sound like a big claim but I stand by it. This news is a huge game changer.

If I was observing this situation from Spain or Italy I would start to seriously consider my options going forward. We now know that the ‘deposit guarantee’ is no longer sacrosanct. The rule of law is no longer respected and the ‘troika’ (The EU, IMF and ECB) can’t be trusted.

Initial reports were that up to 40% of the savings of depositors was demanded. My God. Imagine waking up in Spain one morning and finding out that 40% of your life savings had been stolen to cover the losses of the banks. Now imagine it happening after you had already been warned by the events in Cyprus.

It will be very interesting watching what happens once the banks reopen in Cyprus. Apparently nearby countries were on alert to send across Euros if necessary. The ECB has said it will back the banking system with liquidity. You had better hope so because there will be a lot of angry Russian oligarchs filling out withdrawal slips for billions of Euros. What a farce.

Now to the Australian Stock Market…

The Cyprus issue is not the only thing that has got the market spooked. BHP and RIO plunged yesterday morning with news out of the Hong Kong Credit Suisse Asian Investors conference that things in China aren’t that rosy. Chinese steel companies have rising inventories and the iron ore price has plummeted over the past few weeks with further downside expected.

RIO has fallen more than 20% in a little over a month. BHP is down about 15% in that time and Fortescue has plummeted 32%. I’m actually amazed the ASX 200 is still so high in the face of these figures. The banks are like Atlas carrying the world on its shoulders. If Atlas shrugs the stock market will fall hard and fast.

It’s interesting to note that the worst performing sectors over the past few days have been the Financial, IT and Health sectors. They are the three strongest performing sectors over the last few months so it looks like we’re starting to see some profit taking and long liquidation. We’re still in the very early stages of that process.

So, what next?

The very short term could see some buying pressure emerge once again because we’ve sold off below my initial target of 4975 that I told you about last week.

Click here to enlarge

You can see from the above chart that the intra-day price action in the ASX 200 is creating a distribution between 4975 and 5106 (the solid blue lines) with a Point of Control around 5040.

A false break of the lows at 4975 should see some buying return but my guess would be that there will be some stiff resistance at the point of control at 5040.

If the Australian Stock Market can’t make it back to the Point of Control and instead cracks beneath the lows made yesterday of 4937 then we may be about to witness a fall of hundreds of points in a matter of days. I explain more about that here…

Murray Dawes
Editor, Slipstream Trader

Join me on Google Plus

From the Port Phillip Publishing Library

Special Report: Australia’s Energy Stock BLOWOUT

Daily Reckoning: The Mining Shuffle

Money Morning: Just Like Cyprus: How the Australian Government Turned on its Citizens

Pursuit of Happiness: The Bright Side of the Cypriot Banking Crisis

From the Archives…

Can This Indicator Predict The Dow Jones Next Move?
16-03-2013 – Kris Sayce

Seven Situations to Watch in the Pacific Currency War
15-03-2013 – Dan Denning

Stock Market Warning: Next Week Could be a Blood Bath
14-03-2013 – Murray Dawes

REVEALED: One Opportunity to Escape Your Mortgage
13-03-2013 – Nick Hubble

UK Property: How You Can Buy a House For Less Than 250 Grand
12-03-2013 – Dr. Alex Cowie

By MoneyMorning.com.au

Today we’re at the end of another major era.

Let’s call it the ‘Columbian’ era – as in the Christopher Columbus era, where white European people can sail across the world and go places, do things and impose their will, whether they’re Spanish, Dutch, French, British, Danish, or whatever.

Of course, for the last 65 years of this period, America has been at the top. And what has kept America on top is the simple fact that the US dollar is the world’s reserve currency.

How did we get here? Let’s take a step back to World War I…

A Quick Tour of History

The British pound was pretty much the accepted currency all through the 19th century, you know since probably the Napoleonic Wars at least.

Then, World War I knocked the British on their tail in terms of spending lots of money and national prestige and kind of a European civil war, just a civil war in the sense that white Christian nations were fighting each other, even though they spoke different languages, had different culture, etc.

So in the historical sense you had the British pound linger on, but after World War I the US dollar was suddenly looking good, too.

Now fast forward to 1945. We were the victorious power after WWII, we had the monopoly on atom bombs, we had B-29 bombers to deliver them, we had a navy that crossed the whole world, our industrial base was uniquely intact, we had lots of money, and lots of gold in Fort Knox.

The rest of the world was blown up, destroyed or completely undeveloped. For instance, back then if you looked at the Middle East, it was just desert. If you looked at Latin America, it was predominantly an area of trees, jungles and mountains.

The US was on top and everyone accepted it.

Today, we’re nearing the end of that era. Where now there is real competition between, as Niall Ferguson puts it, ‘the West and the rest’. The rest of the world has decided that they like Western science, Western medicine, and certain aspects of Western business and accounting methods.

They don’t necessarily like Western culture. They’re not enamoured with democracy, with Hollywood; with the drug culture and the TV violence and Madonna and Lady Gaga kind of stuff. They don’t need that part of us, but they do like the science and the medicine and the technology and as they adopt these things the gap between the West and the rest is getting narrower and narrower.

Enter China

Okay, now if you are China, you are 1.3 billion people strong, you are highly nationalistic, and you have a very, very, very long historical memory of everything, every slight, every insult that China and the Chinese people have ever suffered going back 1,000 years. Naturally, you think strategically because all of your smart kids grow up reading Sun-tzu and talk about this stuff.

So if you are the Chinese and you’re looking at this world and you see yourself as a rising power, a power in ascendancy: now what?

Okay, we had the pound, we have the dollar, now what do we have? Is the world going to be run by Russian rubles? Not really. Russia can be run by Russian rubles, perhaps, but the system behind it is too weak to support the world’s reserve currency. How about the euro? Well, Europe speaks for itself. It’s a disaster.

Every day we wake up ready to read the EU’s obituary. It won’t be a Latin American currency that dominates the world. What, the Brazilian real? I doubt it. No African currencies, no Middle Eastern currencies.

So what’s left? The Chinese renminbi? Do you want the yuan to be the world’s reserve currency?

Well, think like a Chinese. If you’re China do you want to have your currency be the world’s reserve currency? It’s tempting, very tempting, but the Chinese are cautious people. So in terms of what system is out there, what would the Chinese like to use? All of this is prefatory to the point I want to make.

The New Global Currency Market

What the Chinese seem to like are these things called special drawing rights, or SDRs, created by the International Monetary Fund in 1969. Special drawing rights are basically a basket of monies, plural: the dollar, the euro, the yen, and the pound sterling.

One thing that hasn’t been part of an SDR in 40 years is gold, but international regulators are set to upgrade gold to what’s called a Tier 1 banking asset; gold will back bonds and loans and depending on the rules, be a basis for fractional banking.

Now in a sense it’s back to the future, because the world relied on the gold standard until the 20th century when they went off it to finance modern wars and stuff.

So anyhow, the IMF’s next major revision of the SDRs is scheduled for 2015, so if you are China – indeed, think like a Chinese – what are you doing for the next two years? You are accumulating as much gold as you possibly can in the Middle Kingdom, as many tons as you can import and mine.

You’re not bragging about it. You’ll publicly report the absolute minimum amount of information that you’re required to under international treaties and obligations. You’ll even go as far as to boldly deny any large accumulation. You’re not going to tell the world that you’re buying gold because then everybody will bid the price up and it’ll cost you more.

You’re going to buy as much gold as you can so that in 2015 when the IMF revises the SDR basket for accounting purposes, you can say, ‘We’ve got ‘XX’ thousand tons of gold, and by default or by de facto our Chinese currency is the strongest currency in the world.’

The yuan won’t be the reserve currency, but a major component of the SDR. And the SDR will now be the backing of the world’s reserve currency – along with a gold component that could come sooner than later.

By 2015 the global monetary system as we know it will be very different. The US, Europe, China will have the three dominant paper currencies in the SDR, and, more importantly everybody’s going be looking at everybody else’s gold holdings.

More tomorrow….

Byron King
Contributing Editor, Money Morning

Join Money Morning on Google+

From the Archives…

Can This Indicator Predict The Dow Jones Next Move?
16-03-2013 – Kris Sayce

Seven Situations to Watch in the Pacific Currency War
15-03-2013 – Dan Denning

Stock Market Warning: Next Week Could be a Blood Bath
14-03-2013 – Murray Dawes

REVEALED: One Opportunity to Escape Your Mortgage
13-03-2013 – Nick Hubble

UK Property: How You Can Buy a House For Less Than 250 Grand
12-03-2013 – Dr. Alex Cowie

By MoneyMorning.com.au

Yesterday was the first day of the Hong Kong Mines & Money conference.

After the reports of fairly morose atmospheres at the other two big global mining conferences held round this time of year – the Prospectors and Developers Association of Canada Conference (PDAC) and the South African Indaba conference – I’m happy to say the mood has been bullish.

The turnout has been strong, with about 4,000 here.

The venue is pretty impressive, with sweeping views of the bay. Hong Kong is in full flow too. Rather than get a cab, I walked an hour to dinner with friends earlier to get a view of the bustle on the streets. My limited impression of Hong Kong is one of plenty of economic activity. Property prices have certainly been good round here. One guy I heard about had paid $2 million for a small apartment.

The View from the Gold Miners

Eric Sprott was the big draw card as the keynote speaker today, though the CEO of Newcrest, Greg Robinson, opened up proceedings. His views on gold were bullish, as they would be, and he hit some of the points I made in my speech the day before.

He pulled out a few other cool facts. For instance, I didn’t know that half of the money spent in exploration globally last year was spent looking for gold. And with very little result. No one is finding big deposits any more, no matter what they spend. So future supply will be hamstrung. Much higher gold prices will be needed to stimulate future supply.

As for production costs, they have soared 256% in ten years:

According to Newcrest’s Greg Robinson, the industry is ‘acutely aware of it’. Hopefully they’ll pull their finger out and do something about it.

On that topic, I weighed in on this after a later talk given by ‘mining associates’ who reckoned the reason costs have soared so much for gold is the drastically falling ore grades the gold industry is chasing in the name of bigger production volumes.

Low grade is expensive to mine, to truck, and to treat. He reckoned that’s why the majors steer clear of gold – it’s so hard to control costs.

Eric Sprott drew a decent crowd for his talk, which focused on precious metals of course. He covered a ton of stuff, starting with a look at debt at the sovereign level, and kicked off with a quote from Mark Carney, the Bank of Canada chief:

‘The Global Minsky moment has arrived. Debt tolerance has decisively turned. The initially well-founded optimism that launched the decades-long credit boom has given way to a belated pessimism that seeks to reverse it.’

The shenanigans in the Cypriot banking system are the perfect backdrop to all this. Sprott reckoned the traders with a short position on gold will be in pain given gold has moved $30 against them in the last few weeks.

With bank runs in Europe possible, he emphasised, ‘having money in the banks – a highly leveraged counter-party – is a risk’. The troika (EU, IMF, and ECB) would do all they could as, ‘No one wants the first domino to fall,’ – but options are running out.

By the way, the ECB has pumped $1.2 trillion into the European financial system in the last few weeks via bank swaps apparently. I must have missed the memo on that one. Clearly there is some trouble brewing.

As for Germany repatriating its gold from the US: How can it take seven years to repatriate 350 tonnes, when China can import that much every six months? Just maybe it’s because the US doesn’t have Germany’s gold…

Some Other Investment Angles

As always, Sprott loves silver. The supply of investible silver is three times bigger than gold, but investors are buying 50 times more than gold according to the US Mint website…so at some point this will have to translate into a supply crunch.

In the 1980′s, Volker admitted that in reference to the gold run of the 70′s ‘the biggest mistake we made was not controlling the gold price’. Sprott expects that the gold price is being similarly managed today to create the illusion of recovery, when nothing could be further from the truth. During Barack Obama’s presidency, the number of food stamp users has jumped form 20 million to 47 million, or 15% of the US population.

As for gold stocks, he doesn’t doubt they’re immensely cheap, but thinks we need to see a sustained move in gold for gold stocks to follow suit. Gold above USD$1,700 would be a good start.

A big theme in the conference is the novel ways of financing the mining sector. With equity hard to come by, two new players are moving in: private equity, where private money buys a company lock stock and barrel, finances it, and turns it around; and the other is royalty streaming – where private money finances it in return of a cut of the product for a long period. There’s more talk about this tomorrow, so I’ll hold back on it until them.

There was a great panel debate about China’s economy, mostly held in Cantonese by Chinese bankers, so I listened via translator. It was pretty interesting seeing it from their eyes. This is something I’ll cover in the next issue of Diggers & Drillers.

I’ve spoken to a dozen companies today, and need to run through all their details when I get back. There is plenty of new fodder to run the ruler over.

One seminar that was pretty cool was on Myanmar, formerly Burma, which is taking off now it’s opening up. Apparently if you want to make a quick buck on property, you should go and check it out – its property market grew at 47% in 2012! Not bad for a year’s work!

That’s it for me tonight. I’m stuffed. I’ll check in tomorrow.

Dr Alex Cowie
Editor, Diggers & Drillers
Join me on Google+

From the Archives…

Can This Indicator Predict The Dow Jones Next Move?
16-03-2013 – Kris Sayce

Seven Situations to Watch in the Pacific Currency War
15-03-2013 – Dan Denning

Stock Market Warning: Next Week Could be a Blood Bath
14-03-2013 – Murray Dawes

REVEALED: One Opportunity to Escape Your Mortgage
13-03-2013 – Nick Hubble

UK Property: How You Can Buy a House For Less Than 250 Grand
12-03-2013 – Dr. Alex Cowie

Source: Stockopedia – Stock Market Research Network.

With virtually no money to play with, Chancellor George Osborne has proposed a ‘fiscally neutral’ Budget, but there were a few point of interest for investors… 

• An abolition on the payment of stamp duty (0.5pc) from next April on the purchase of shares quoted on the Alternative Investment Market in a move designed to force capital into smaller companies. This should remove the distortion between investing in shares and spread-betting for those stocks and should help liquidity. Read more about this here. Marcus Stuttard, the head of AIM, has been reported as saying that stamp duty is a barrier to capital raising for small caps. Separately, the Government is already consulting on allowing investors to buy shares through ISAs. 
• All the major housebuilders have seen their share prices rise on news that the Government is set to pump more cash in to supporting buyers of new homes. The ‘Help to Buy’ shared equity scheme will see the Government lend up to 20pc of the cost of a new home to help potential buyers secure a deposit and mortgage. Buyers will have to stump up a deposit of 5pc before the Government steps in with interest-free loans of up to 20pc on homes worth less than £600,000. A second part of the scheme involves a £130bn mortgage guarantee scheme to help current homeowners move up the property ladder. 
• Shares in UK gas producer Igas Energy (LON:IGAS) jumped on news that the Government will introduce a new tax regime for shale gas development in the UK to promote early investment. 
• Confirmation that the Government will later this year sign contracts for future North Sea decommissioning relief, which Osborne said was already increasing investment there. 
• Ramp;D credit increased to 10pc – which is good news for innovators. 
• Shares in many brewers and pub groups have moved into positive territory on news that the beer duty escalator has been scrapped and a penny knocked off the price of a pint.

Stockopedia

Original Article: Budget 2013 – Initial reaction for investors

By www.CentralBankNews.info
   The U.S. Federal Reserve maintained its target for the benchmark federal funds rate and its monthly purchases of $85 billion of housing-related debt and Treasury bonds, saying the economy was returning to moderate growth, and while the labor market has improved, the unemployment rate remains elevated.
    Repeating previous statements, the Federal Reserve said it it expects that its “highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens.”
    This means that the federal funds rate will be kept at the current level of 0-0.25 percent for a least as long as the unemployment rate remains above 6.5 percent and inflation is projected at a maximum 2.5 percent between one and two years ahead, the Federal Reserve’s policy committee, the Federal Open Market Committee (FOMC) said in a statement.
    The U.S. headline consumer price inflation rate rose to 2.0 percent in February from 1.6 percent in January while the unemployment rate fell to 7.7 percent from January’s 7.9 percent.
    The FOMC’s latest forecast calls for the jobless rate to decline faster than forecast in December but  first hit the target of 6.5 percent in 2015 when the rate is forecast at 6.0-6.5 percent.

    The Federal Reserve said household spending and business fixed investment had advanced, and the housing sector had strengthened further since its last meeting but fiscal policy had become somewhat more restrictive.
    U.S. fourth quarter Gross Domestic Product was revised upwards to growth of 0.1 percent from the third quarter from an initial estimate of a 0.1 percent shrinkage. The annual growth rate in the fourth quarter was 1.6 percent, down from the third quarter’s 2.6 percent.
    In its latest economic forecast, the FOMC trimmed its 2013 GDP forecast to 2.3-2.8 percent, from a previous forecast of 2.3-3.0 percent, and the 2014 forecast to 2.9-3.4 percent from 3.0-3.5 percent.
     In 2015, GDP is forecast to grow 2.9-3.7 percent compared with December’s forecast of 3.0-3.7 percent.
    The U.S. unemployment rate is forecast to ease to 7.3-7.5 percent this year and then decline to 6.7-7.0 percent in 2014. The inflation rate, as measured by personal consumption expenditures, is forecast to remain below the Federal Reserve’s 2.0 percent target this year, then hit 1.5-2.0 percent in 2014 and 1.7-2.0 percent in 2015.

     www.CentralBankNews.info