Analyst: Spain Has ‘Worse Problems Than Greece’

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“Spain’s eye-wateringly high unemployment the and collapse of its real estate market mean that Spain has significantly worse problems than Greece and could threaten the euro zone’s new-found, albeit fragile stability, an analyst told CNBC.com Tuesday.

CNBC.com

“Spain has very large downside risks and it needs to tread very carefully – Spain is in a very fragile situation. Its problems are significantly worse than Greece’s,” Sony Kapoor, managing director at international think tank Re-Define said.

He added that a “huge danger” was posed to the macroeoconomic situation and the social fabric of the country by the current austerity program and an expected 5 percent deficit adjustment.

“The financial panic is temporarily over but 2012 will be the year of austerity across Europe and Spain is a microcosm for the euro zone as a whole,” he said.

Earlier this month the Spanish premier Mariano Rajoy, publicly defied Brussels-imposed targets, which were 4.4 percent of gross domestic product, saying that the targets were based on forecasts of economic growth when in fact the government expects the Spanish economy to contract this year.

The country has the euro zones highest rate of unemployment – now over 22 percent.

Euro zone finance ministers rebuked the country – the euro zone’s fourth largest economy – at the ECOFIN meeting Monday urging it to make new cuts to its 2012 budget to reduce its deficit by a further 0.5 percent, agreeing a new target of 5.3 percent….”

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“BRUSSELS (AP) — The United States, the European Union and Japan filed complaints Tuesday with the World Trade Organization charging that China is limiting its export of rare earths, minerals that are vital to the production of technology components.

China produces almost all of the world’s supply of rare earths but has limited exports in recent years. That worried countries with large technology industries as rare earths are used in a variety of sectors to make hard drives, car parts, electronics, fiber optics — and every smartphone in use today.

EU Trade Commissioner Karel De Gucht said China’s export quotas and export duties give Chinese companies an unfair competitive advantage, and must be removed.

“These measures hurt our producers and consumers in the EU and across the world,” De Gucht said.

The three separate but coordinated filings with the WTO formally request dispute settlement consultation, which is the first step in a WTO complaint. If no resolution is found, the dispute can be transmitted to a WTO Panel for a ruling.

Earlier Tuesday, anticipating the complaints, China defended curbs on production of rare earths as an environmental measure.

Global manufacturers that depend on Chinese supplies were alarmed by Beijing’s decision in 2009 to limit exports while it built up an industry to produce lightweight magnets and other goods that use them. China has about 30 percent of rare earths deposits but accounts for 97 percent of the world’s production…”

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Yippy

[youtube://http://www.youtube.com/watch?v=7y4gwAQdr20 450 300]

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Carmike Cinemas Inc. (CKEC) : The fourth-largest U.S. theater chain posted fourth-quarter revenue that exceeded the average analyst projection, data compiled by Bloomberg show.

Ebix Inc. (EBIX) rose 2.3 percent to $23.22. The insurance software provider increased its quarterly dividend to 5 cents from 4 cents.

Majesco Entertainment Co. (COOL) : The video game publisher said fiscal 2012 adjusted earnings may be 25 cents to 35 cents a share. Analysts project 35 cents a share on average, data compiled by Bloomberg show.

Midas Inc. (MDS) surged 26 percent to $11.35. The operator of car-service shops agreed to be acquired by TBC Corp. for $310 million in cash, or $11.50 per share, a 28 percent premium to yesterday’s closing price.

Urban Outfitters Inc. (URBN) fell 5.1 percent to $28. The operator of its namesake, Anthropologie and Free People brands reported fourth-quarter earnings that missed the average analyst estimate.

Yahoo! Inc. (YHOO) (YHOO US): The owner of the most popular U.S. Internet portal accused Facebook Inc. in a federal court lawsuit of infringing patents related to Internet advertising and information sharing. Lawyers for Yahoo, in a complaint filed in federal court in San Jose, California, seek a court order barring Facebook from infringing 10 patents and awarding it triple damages.

Gapping up

CKEC +13.2%, AWI +6.4%,  RIO +2.8%, ESRX +2.2%, MT +2.2%, DB +2.1%, BHP +1.8%, SINA +1.6%, RENN +1.2%, BIDU +0.8%,  GOLD +1%, AA +0.8%,

RBS +2.6%, HBC +2.3%, DB +2.1%, ING +2.1%, CS +1.9%, C +1.8%, WFC +1.2%, BAC +1%, BEAM +4%,  ESRX +2.2%, MHS +1.7%, WOLF +20.8% ,

REN +7.7%,  GNC +3.7%, EBIX +2.3%,

Gapping down

COOL -11.8%, SB -7.7%, XPO -6.5%, URBN -5.5%, MWE -3.6%, SLXP -2.4%, MDVN -1.1%,  BWEN -4.6%,  CLNE -3.9%, XPO -6.5%, BCRX -3.6% ,

MWE -3.4%,  WCRX -3% , SLXP -2.4%,  MDVN -1.1%,

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ACE Ltd. (NYSE: ACE) Added to Conviction Buy List at Goldman Sachs.

Apartment Investment & Management (NYSE: AIV) Raised to Outperform at RBC.

Booz Allen Hamilton (NYSE: BAH) Cut to Market Perform at Wells Fargo.

Cablevision Systems Corporation (NYSE: CVC) Cut to Hold at Deutsche Bank.

Honeywell International Inc. (NYSE: HON) Reiterated Buy with $70 target at Argus.

IPC The Hospitalist Company, In (NASDAQ: IPCM) Started as Buy at Citigroup.

Macy’s, Inc. (NYSE: M) named Bull of the Day at Zacks.

Mylan Inc. (NASDAQ: MYL) maintained Buy and raised target to $27 at Argus.

Ultra Petroleum Corp. (NYSE: UPL) Cut to Underperform as Bear of the Day at Zacks.

Urban Outfitters Inc. (NASDAQ: URBN) maintained Neutral but cut estimates at Credit Suisse.

Watson Pharmaceuticals Inc. (NYSE: WPI) Reiterated Buy with $70 target at Argus.

In Play

On the Wires

Yields are rising….

The dollar is @ 80.16

X auto is up 0.9%

“Japanese billionaire Kazuo Okada, saying Wynn Resorts Ltd. (WYNN) is run by Chairman Steve Wynn as a “personal fiefdom,” is challenging the redemption of his own 20 percent stake in the company at an $800 million discount.

Aruze USA, through which Okada invested in Wynn Resorts, disputes that any redemption occurred because Wynn is legally barred from redeeming the securities, lawyers for Okada and the holding company said in a counterclaim filed yesterday in federal court in Las Vegas….”

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CDS contracts have not gone haywire yet…

“The Australian and New Zealand dollars rose for the first time in three days as Asian shares rallied, boosting demand for riskier assets.

The New Zealand dollar strengthened against all of its 16 major counterparts after reports showed the nation’s house and food prices increased in February. The appeal of Australia’s currency was limited after home loans in the country fell more than economists estimated and business confidence slumped to a five-month low…”

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“Oil rebounded from the lowest price in almost a week as investors bet that fuel demand may increase amid signs the U.S. and Chinese economies are strengthening.

Futures gained as much as 0.7 percent in New York after losing 1 percent yesterday. U.S. retail sales rose in February by the most in five months, according to a Bloomberg News survey before today’s Commerce Department report. China’s industrial output growth will pick up in March and April, a former industry minister said. Oil has climbed this year on concern tension with Iran may lead to military conflict in the Middle East, where more than half the world’s oil reserves are located.

“Oil prices have been bolstered by better-than-expected leading indicators and ample liquidity,” said Hannes Loacker, an analyst at Raiffeisen Bank International AG (RBI) in Vienna who predicts U.S. futures will average $104 a barrel this year. “Chinese economic growth should be strong enough to prevent the oil price from falling too sharply.”

Oil for April delivery rose as much as 79 cents to $107.13 a barrel in electronic trading on theNew York Mercantile Exchange. It was at $106.86 at 11:44 a.m. London time. The contract yesterday fell $1.06 to $106.34, the lowest settlement since March 7. Prices are 8.1 percent higher this year.

Brent crude for April settlement on the London-based ICE Futures Europe exchange was up 74 cents, or 0.6 percent, at $126.08. The European benchmark contract was at a premium of $19.22 to New York crude. The spread close at $19 yesterday, the most since Feb. 6….”

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“Gold declined before a Federal Open Market Committee meeting and as Greece prepares to receive a second bailout. Platinum rose above gold for a second day.

The best six months of job gains since 2006 have helped reduce the odds of a third round of asset purchases by the U.S. Federal Reserve, according to a Bloomberg News survey. Bullion had the biggest one-day decline since 2008 on Feb. 29 after Fed Chairman Ben S. Bernankegave no signal of a third round of quantitative easing, or QE3, sending the dollar higher. The dollar gained today against a six-currency basket including the euro and yen….”

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“German investor confidence jumped to a 21-month high in March after the European Central Bank flooded financial markets with cash and the sovereign debt crisis showed signs of abating.

The ZEW Center for European Economic Research in Mannheim said today its index of investor and analyst expectations, which aims to predict economic developments six months in advance, advanced to 22.3 from 5.4 in February. That’s the fourth straight increase and the highest reading since June 2010. Economists forecast a gain to 10, according to the median of 36 estimates in a Bloomberg News survey….”

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Hungary is part of the EU and has the hottest inflation….

Italy sold $15.7 Billion ar record low yields…..