Futures up for second day ahead of GDP report

Wednesday, June 26th, 2013 | Finance News

NEW YORK (AP) — Stock futures are rising ahead of the final report on first-quarter growth in the U.S., and what appears to be a retreat by China, which had earlier indicated that it would not keep its commercial banks supplied with cash as credit tightens.

Dow Jones industrial futures are up 50 points to 15,214. S&P futures have added 6.6 points to 1,588. Nasdaq futures are up 14.75 points to 2,873.

The government is expected to report annual U.S. economic growth of 2.4 percent for the first three months of the year. Economists say that growth has slowed in the current quarter, but predict stronger growth later this year.

China made an abrupt U-turn a day after essentially saying that commercial banks would have to fend for themselves as credit tightens.

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Italy denies finances at risk from derivatives

Wednesday, June 26th, 2013 | Finance News

MILAN (AP) — The Italian Treasury says that derivatives contracts it signed years ago pose no threat to state finances.

Italian financial authorities also denied in a statement Wednesday that Italy used the potentially risky financial instruments at the end of the 1990s to help the country meet benchmarks for admission to the euro currency union.

Questions about potential risks linked to Italian derivatives arose from media reports that said Italy risks losing 8 billion euros ($10.5 billion) on derivatives contracts it restructured at the height of the eurozone crisis. The reports in La Repubblica and the Financial Times were based on a confidential report by the Rome Treasury.

A derivative is a financial contract whose value is based on an underlying asset, such as a stock or bond.

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Peabody, Glencore Xstrata slash Australian coal mining jobs

Wednesday, June 26th, 2013 | Finance News

PERTH (Reuters) - Peabody Energy Corp and Glencore Xstrata will cut around 500 mining jobs in Australia, a company official and trade publication said on Tuesday, as a global glut in coal supply pushes down prices.

Peabody plans to cut around 450 contractor jobs, while Glencore Xstrata will lay off around 46 employees at its Ravensworth coal mine.

Prices for thermal coal, used for power generation, have fallen over 30 percent in the last two years to around $80 per metric ton (1.1023 tons), while prices for coking coal, used for steelmaking, have dropped about 40 percent in the last year to around $130 per metric ton.

"(Contractors have) traditionally been an area of high spend for the company and as a result we will be reducing approximately 450 contractor positions at our mines over the coming weeks," Peabody president Charles Meintjes was quoted as saying by industry publication Australian Mining.

A Peabody spokeswoman was not available for comment.

Peabody said the cuts would take place across its operations in the coal-rich eastern Australian states of Queensland and New South Wales, where it produces both coking and thermal coal.

Xstrata's job cuts would reduce Ravensworth's mine workforce by about 26 percent, with around 130 employees remaining.

A company spokesman, who asked not be named, said the layoffs would trim back production at the mine, but did not give any specific figures. The mine produced around 2.2 million metric tons of mostly coking coal last year.

Glencore Xstrata has cut around 700 jobs since late last year, about 100 more jobs than it said it planned to eliminate late last year.

(Reporting by Rebekah Kebede; Editing by Jeremy Laurence)

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