U.S. Stocks Post Biggest Post-Election Drop on Economic Concern


Traders work on the floor of the New York Stock Exchange in New York, Nov. 5, 2008. Photographer: Ramin Talaie/Bloomberg News

Nov. 5 (Bloomberg) — The stock market posted its biggest plunge following a presidential election as reports on jobs and service industries stoked concern the economy will worsen even as President-elect Barack Obama tries to stimulate growth.

Citigroup Inc. tumbled 14 percent and Bank of America Corp. lost 11 percent as the Standard & Poor’s 500 Index and Dow Jones Industrial Average sank more than 5 percent. Nucor Corp., the largest U.S.-based steel producer, slid 10 percent after bigger rival ArcelorMittal doubled production cuts amid slowing demand. Boeing Co., the world’s second-largest commercial planemaker, lost 6.9 percent after UBS AG forecast a 3 percent drop in global air traffic next year.

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Boeing, Airbus May End Up With 200 Planes `Parked in Desert’ Amid Crunch

Nov. 6 (Bloomberg) — Airbus SAS and Boeing Co. may end up with as many as 200 new planes without buyers next year because airlines are unable to obtain funds to pay for them amid a global credit squeeze, a consultant said.

“There’s a funding gap and we don’t really know where the money is coming from,” Eddy Pieniazek, a director of aviation adviser Ascend, said at a conference in Hong Kong yesterday. “If the money doesn’t arrive, you can quite easily see 200 new aircraft, or whitetails, parked in a desert.”

Airbus and Boeing, the world’s two-biggest airplane makers, will probably deliver about $65 billion of large commercial aircraft next year, according to a report by JPMorgan Securities Inc. Leasing companies and banks, which will account for about 60 percent of the aircraft financing market in 2008, are likely to “pull back substantially,” creating a funding gap as wide as $20 billion, the report said.

“Nobody is getting out of this alive,” said Bill Cumberlidge, director of aviation asset finance at Allco Finance Group, which on Nov. 4 handed over operations to outside managers after warning it may default on its debt. “The debt market is dead.”

“Zero Liquidity”

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UK energy prices rising twice as fast as EU average


Energy bills in the UK rise faster than in the EU, figures show. Photo: David Sillitoe

Energy prices in Britain in the past year have risen twice as fast as the European Union average, according to latest figures.

Gas and electricity prices in the UK rose by 29.7% in the last 12 months compared with a 15% increase for the EU.

The figures, released by the Organisation for Economic Co-operation and Development (OECD), show bills are up just 14% in France and 12.2% in Germany.

Ed Mayo, chief executive of government watchdog Consumer Focus, said: “The UK energy consumer is being clobbered faster and harder than those in Europe. Other countries may be doing more to keep their prices down and we should learn from them.

“The UK has a relatively free market, but the freedom to cut prices in the early years now seems to be the freedom to raise prices with impunity.

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U.S. Airstrike Reported to Hit Afghan Wedding


Afghan men examined a house that was allegedly destroyed by a U.S. airstrike Tuesday.
Humayoun Shiab/European Pressphoto Agency

KABUL, Afghanistan – An airstrike by United States-led forces killed 40 civilians and wounded 28 others at a wedding party in Kandahar Province in southern Afghanistan, Afghan officials said Wednesday. The casualties included women and children, the officials said.


The New York Times

The United States military and Afghan authorities were investigating the reports about the latest attack, the American military said in a statement, but it gave no confirmation of the strikes or any death toll.

The reports of the strike, in a region that has become a renewed front line in the battle against the Taliban, showed the raw tensions between the United States and Afghanistan over the toll suffered by civilians in the war, and came just hours after the election of Barack Obama as the next American president.

The reports recall an assault in August in western Afghanistan that was initially disputed by the United States, in which an American gunship killed at least 30 civilians. On Wednesday, at a news conference called to congratulate Mr. Obama, President Hamid Karzai said his first request to Mr. Obama would be “to end the civilian casualties.”

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Euro banks spread gloom as profits, forecasts fall


NP Paribas Chief Executive Officer Baudouin Prot speaks during a news conference to announce the bank’s third-quarter results in Paris November 5, 2008.

PARIS (Reuters) – A raft of European bank results did little to lift gloom around the sector on Wednesday, with a recurring trend of falling profits and rising bad debts stemming from the global financial crisis.

France’s biggest bank BNP Paribas (BNPP.PA: Quote, Profile, Research, Stock Buzz) posted a 56 percent fall in third-quarter profits, Allied Irish Banks (ALBK.I: Quote, Profile, Research, Stock Buzz) cut its earnings forecast, and Greece’s Emporiki Bank (CBGr.AT: Quote, Profile, Research, Stock Buzz) swung to a loss.

Capital rebuilding continued in the face of a tough outlook as Royal Bank of Scotland (RBS.L: Quote, Profile, Research, Stock Buzz) looked to raise up to 3 billion pounds ($4.7 billion) from a government-backed bond, and Austria’s Raiffeisen Zentralbank said it may ask the government for 2 billion euros ($2.6 billion).

By 7:15 a.m. EST the DJ Stoxx banking index was down 0.7 percent, led by 4 percent falls for BNP and Allied Irish.

Profits have tumbled across the sector, and several banks have warned of more writedowns and rising bad debts this year, though there is optimism that government rescue packages have left balance sheets strong enough to withstand more losses.

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Guardians of the unborn

Women in the Netherlands who are deemed by the state to be unfit mothers should be sentenced to take contraception for a prescribed period of two years, according to a draft bill before the Dutch parliament.

The proposed legislation would further punish parents who defied it by taking away their newborn infant. “It targets people who have been the subject of judicial intervention because of their bad parenting,” explained the author of the bill Marjo Van Dijken of the socialist PvDA. “If someone refuses the contraception and becomes pregnant, the child must be taken away directly after birth.”

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Medvedev Confronts U.S. on Missile Shield After Obama Victory

Nov. 5 (Bloomberg) — Russian leader Dmitry Medvedev said he would deploy new missiles in Europe, confronting the U.S. on the day Barack Obama was declared the winner in America’s presidential election.

Medvedev said he would place a short-range missile system designed to carry conventional warheads in Russia’s exclave of Kaliningrad, wedged between Poland and Lithuania.

“An Iskander rocket system will be deployed in the Kaliningrad region to neutralize the missile-defense system if necessary,” Medvedev said, referring to U.S. plans to place elements of a missile shield in Poland and the Czech Republic.

Medvedev blamed the U.S. for failure to coordinate its economic policy with other countries so that a “local” crisis turned into a global one, leading to “a fall on the markets of the whole planet.” He also renewed his assertion that the U.S. provoked the war between Russia and Georgia in August.

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Hamas fires rockets at Israel after 6 killed


Palestinians carry a man who was wounded in an Israeli army raid, into hospital in Deir El Bahlah in the central Gaza Strip, early Wednesday, Nov. 5, 2008. Israel launched an airstrike on Gaza early Wednesday after its troops clashed with Hamas militants who fired mortars into Israel, leaving six Palestinians dead. It was the first battle since a June truce mostly quieted violence in the volatile territory.(AP Photo/Khalil Hamra)

GAZA CITY, Gaza Strip (AP) – Hamas militants pounded southern Israel with a barrage of rockets Wednesday, hours after Israeli forces killed six gunmen in a fresh bout of violence that threatened to unravel a five-month-old truce that has brought relief to both Gaza and southern Israel.

The clashes began late Tuesday after the Israeli forces burst into Gaza to destroy what the army said was a tunnel being dug near the border to abduct Israeli troops.

Despite the outbreak of violence, both Israeli authorities and officials with Gaza’s Hamas government said they wanted to restore the calm that has largely prevailed over the past five months.

After the Israeli incursion, Hamas gunmen battled Israeli forces and Gaza residents reported the sound of explosions, gunshots and helicopter fire. One Hamas fighter was killed, prompting a wave of mortar fire at nearby Israeli targets.

An Israeli airstrike then killed five Hamas militants preparing to fire mortar shells. Hamas responded with the barrage of rockets.

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Israel launches deadly airstrike in Gaza


Medical workers wheel a wounded man to hospital in the central Gaza strip on Tuesday after clashes.

GAZA CITY (CNN) — Israel launched an airstrike Tuesday night on southern Gaza after clashing with Hamas militants in central Gaza, Palestinian sources and Israel Defense Forces said.

Four were killed in the airstrike, which occurred east of Khan Younis, Palestinian sources said. They said a drone and an apache helicopter could be seen.

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Obama Is Elected 44th U.S. President, First African-American to Win Office

Nov. 5 (Bloomberg) — Barack Obama was elected the 44th president of the United States, opening a new chapter in the country’s history as the first African-American to hold the world’s most important job.

The Illinois senator capped his 21-month quest with a sweeping electoral victory that also enhanced the Democrats’ majority in Congress and marked the end of an era of Republican dominance in Washington.

Obama crossed the requisite threshold of 270 electoral votes to defeat Republican rival John McCain, when television networks declared him the winner in the state of California.

That gave the Democratic nominee at least 275 electoral votes, according to the projections, and his tally is likely to grow as more results come in and states that backed Republican President George W. Bush in 2004 switch sides.

Obama’s victory, along with Democratic gains in congressional contests, puts him and his party in firm control of the federal government for the first time since the early 1990s. That gives Obama an opportunity to turn his victory into a pivotal moment in the country’s political history.

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