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Bahrain Suspends Stock Market Trading Due to State of Emergency - (www.bloomberg.com) Bahrain closed its stock exchange and the cost of insuring against default by the Persian Gulf nation held near the highest since July 2009 as clashes between security forces and anti-government protesters intensified. The nation’s five-year default swaps dropped 7 basis points to 352 today after surging 44 yesterday to surpass Lebanon, whose debt carries a lower credit rating, for the first time in more than a year. Fitch Ratings cut Bahrain two levels yesterday as the government imposed a three-month state of emergency. Clashes between the mainly Shiite Muslim protesters in Bahrain and forces from their Sunni government injured hundreds and drew criticism from Shiite-ruled Iran. Bahraini opposition group al-Wefaq said two of its members were killed when security forces moved to clear demonstrators from the Pearl Roundabout in the capital. Bahrain is home to the U.S. Navy’s Fifth Fleet and its ruling family has close links with Saudi Arabia, an ally of the U.S. in its attempts to halt Iran’s nuclear program.
Portugal’s Rating Cut Two Steps by Moody’s on Outlook - (www.bloomberg.com) Portugal’s debt rating was cut by Moody’s Investors Service, which cited a weaker outlook for economic growth, risks to the government’s deficit- reduction plans and a possible need to recapitalize banks. The rating was downgraded to A3, four steps from so-called junk status, according to an e-mailed statement from Moody’s yesterday, with the outlook on the grade “negative.” The euro slipped after the announcement, to $1.3982 per euro at 10:54 a.m. in Tokyo from $1.3998 yesterday. Higher interest rates set by the European Central Bank may exacerbate the challenge for Portugal, Moody's said, as it tries to rein in the euro region’s fourth-biggest budget gap and avoid the bailout fate of Greece and Ireland needed. The government is raising taxes and carrying out the deepest spending cuts in more than three decades in its battle to restore investor confidence.
Socrates Bailout Threat, Moody’s Cut Send Portugal Bonds Lower - (www.bloomberg.com) Portuguese bonds fell after Prime Minister Jose Socrates raised the specter of needing a bailout and Moody’s Investors Service cut the country’s debt rating. The yield on 10-year debt rose 3 basis points to 7.44 percent and the spread, a measure of risk, widened 2 basis points to 429 more than comparable German bunds. “Market participants have strong concerns about the ability of Portugal to continue meeting its funding needs,” Valentin Marinov, a senior currency strategist at Citigroup Inc. inLondon, wrote in a note to clients. “The expectation of potential bailout could erode further the demand for the debt of the euro zone member state going forward.” Opposition lawmakers’ resistance to additional budget cuts announced last week to meet deficit targets threatens a “political crisis,” Socrates said late yesterday in Lisbon. “The consequence of a political crisis is the worsening of the financing risks of our economy and would lead Portugal to request external intervention.”
GE’s $1 Billion in Nuclear Sales at Risk as Nations Ponder Industry Future - (www.bloomberg.com) General Electric Co. (GE)’s goal of broadening its $1 billion nuclear service-and-parts business with sales of new reactors risks stalling as world leaders reconsider the future of atomic energy. Governments from Germany to India are reassessing the technology after Japan’s March 11 earthquake and tsunami crippled a power plant and raised the threat of a meltdown.China today halted nuclear project approvals and plans safety inspections of new facilities. Political doubts after the Japan disaster may signal dwindling appetite for new plants, and the reactors that Chief Executive Officer Jeffrey Immelt has said he wants to pursue. Three reactors at the Fukushima Dai-Ichi plant use a GE design, including the damaged No. 1 unit that began operating in 1971. “We want to look at, just like the whole industry, the details of what happened here,” GE Power & Water CEO Steve Bolze said yesterday in an interview. “There is going to be a lot of discussion, and we’re part of that process.”
OTHER STORIES:
Global Demand for U.S. Assets Falls on Lower Purchases of Bonds, Equities - (www.bloomberg.com)
Nuclear Fuel Rods May Be Damaged as Japan Battles Meltdown - (www.bloomberg.com)
China Leading Economic Index Rebounds, Easing Concern of Sudden Slowdown - (www.bloomberg.com)
Libyan Rebels Fall Back as Qaddafi Forces Near Benghazi - (www.bloomberg.com)
Ink Barely Dry on Finance Ministers’ Deal, Trichet Calls Europe’s New Fiscal Rules Weak - (www.nytimes.com)
Japan’s Government Likely to Bear Much of the Loss - (www.nytimes.com)
U.S. Producer Prices Rise More than Forecast, Led by Food, Oil - (www.bloomberg.com)
U.S. Housing Starts Fell in February to Lowest Since April 2009 - (www.bloomberg.com)
Fed Signals Further Stimulus Unlikely as Recovery Gains Strength - (www.bloomberg.com)
U.S. Mortgage Applications Fell Last Week on Fewer Purchases - (www.bloomberg.com)
Crisis Adds New Risk to Global Recovery - (www.online.wsj.com)
Freddie Mac’s Former Chief May Face S.E.C. Action - (www.nytimes.com)
Japan Says 2nd Reactor May Have Ruptured With Radioactive Release - (www.nytimes.com)
Last Defense at Troubled Reactors: 50 Japanese Workers - (www.nytimes.com)
Workers briefly abandon Japan nuclear plant as crisis worsens - (www.nytimes.com)
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