France issued Wednesday nearly eight billion euro medium-term debt at a lower cost than in April when the first auction of securities of a period of two to five years since the election of Francois Hollande as President of the Republic.

BTAN of the 5-year benchmark was served at an average rate of 1.72%, a record low at an auction of a 5-year benchmark. In April, Agence France Trésor, which manages the debt of the State, had issued the same BTAN at an average rate of 1.83%.

The BTAN reference to two years was awarded to the average rate of 0.74% against 0.85% in April.

AFT issued a total of 7.996 billion euros, the maximum target was announced that $ 8.0 billion.

Overall demand was strong, totaling 23.675 billion euros, giving a coverage ratio (amount requested on amount used) high of 2.96 against 2.58 in April and an average of 2.38 in 2011.

"Very good French auctions. Demand was very strong on the two years and five years, "said Peter Chatwell, rates strategist at Credit Agricole CIB

… …… "If you need to invest in euros, France is a much more attractive proposition than Germany. The coverage ratio is huge, "said Marc Oswald, strategist at Monument Securities in London, adding that this does not mean that fears about France and the euro area have disappeared ……

… "The question is whether France will fail in the next three to four years. I reply emphatically not, and on this basis, the French return to Germany is relatively attractive, "says he

…… Germany …, reference in the market for sovereign debt in the euro area, has awarded its side Wednesday 4.1 billion euros of 10-year Bund, for a total announced ; of 5.0 billion euros, the coverage ratio is set at 1.5 against an average of 1.36 since the beginning of the year ….. The Bund

…. suffers from its success as a safe haven of the eurozone. The show is made to a historically low rate of 1.47%.

Secondary market, the 10-year Bund yield fell to 1.43% Tuesday, a record low while the risk aversion wins and assuming an output of Greece in the euro area.

Strategists point out that demand is not "fantastic" but it is solid given the very low yield of the Bund.

For Michael Leister, strategist at DZ Bank in Frankfurt, where the yield spreads between French and German bonds rose, due to the political stalemate in Greece and renewed concerns about the euro area, "throughout the French bonds also benefit from the uncertainty." 

AFT has also issued 1.182 billion euros Wednesday of comparable Treasury bonds indexed to French inflation (OATi) and inflation in the euro area (OATei) of maturities in 2022, 2023 and 2027, at the top of the announced objectives (1.2 billion). Demand amounted to 3.467 billion euros, giving a coverage ratio of 2.9.

In France, the manufacturing PMI for April is for the eighth time below 50 means a contraction in activity. It is even lower in the eurozone. Germany is also affected. A worker at the assembly plant of Alstom's TGV Reichshoffen.

The activity of the French manufacturing industry remained very depressed in April, very close to its lowest level for 33 months, recorded in March, announced Monday the firm Markit in a final estimate. The manufacturing PMI rose to 46.9 points in April, even lower its first estimate (47.3 points) but slightly higher than in March (46.7 points). Located for the eighth time in the last nine months to below 50 points, it signals a contraction.  

"The weakness of the French manufacturing sector continues in April, manufacturers reporting a decline of particular concern in the volume of new orders," said Jack Kennedy, economist of the firm. Companies, he says, "Yet again, a weak domestic demand, but also report weak sales in European markets". The poor performance of French manufacturing firms resulting from a further decline in new orders in April, with a tenth consecutive month of sales and the contraction rate highest since three years, says the firm.

According to companies surveyed by Markit, this reflects mainly the weak domestic market, the foreign sales down only marginally. Reducing the workload, manufacturers continue to downsize in April, Markit adds, noting a rate job cuts at its highest level since July 2010. The purchase prices have also continued to rise in the French manufacturing sector in April, driven up by fuel prices and raw materials. Rising prices "factory" is however the lowest since three months, due to strong competitive pressures on businesses. The PMI is compiled from a survey of over 400 companies operating in the manufacturing industry in France.

Activity in the manufacturing industry has also contracted sharply in April in the euro area, falling to its lowest level in nearly three years. The PMI rose to 45.9 points in April against 47.7 points the previous month, its lowest level in 34 months. This is slightly lower than the initial estimate of 46 points, the company said Markit. Disturbing fact: the weakness of the manufacturing sector is no longer limited to the most fragile countries in the euro area since the German PMI shows a low of 33 months (to 46.2 points) and that the contraction is accelerating in the Netherlands .

"The manufacturing sector in the euro zone is sinking into a new phase of recession in April, the latest PMI data are consistent with revealing a disturbing decline in quarterly industrial production by over 2%," said Chris Williamson, chief economist at Markit. The origin of this deterioration: the decline of manufacturing, itself weakened by the sharp contraction in new orders. Businesses in the euro area face a weakening of demand in both domestic markets, where the austerity measures put in place weigh on demand and exports.

"Germany has experienced the full this fall in exports, the lower volume of new export orders received by German manufacturers to accelerate in April and causing contraction of German production for the first time since the beginning of year, "said Markit. The future remains bleak. Faced with weak demand in southern Europe, "the sources of growth appear to be limited, unless a strong rebound in exports outside the euro area," said the company Markit said in a statement.

European stock markets and debt markets Monday suffer political uncertainties, the first round of presidential elections in France and the failure of the budget discussions in the Netherlands Low-raising fears of further complications to a settlement of the debt crisis in the eurozone.

Markets are also affected by sluggish activity indicators in the euro zone and China.

In France, the second round of presidential elections on May 6 oppose the socialist Francois Hollande and the outgoing president Nicolas Sarkozy, who obtained respectively 28.63% and 27.18% of popular vote final figures of the Ministry of Interior. 

"In general, markets have begun to punish the weak proposals for Francois Hollande to improve the competitiveness of the French economy and lack of leeway policies of Nicolas Sarkozy if he could be elected ", wrote in a note Exane BNP Paribas.

Around noon, the difference (spread) between the rate of return of government bonds to 10 years and its French equivalent German (Bund) is widening three basis points (bps), to 142 bps, after reaching 149 bps in the morning.

This gap, which was only 110 bps at the beginning, had reached 151 basis points Thursday after a rumor about a possible deterioration in the sovereign rating of France. 

"FRANCE IN DOOR-TO-FALSE"

The performance of the French loan to 10 years in the secondary market amounted to 3.10% after exceeding 3.16% in the morning, against 3 , 09% at the close Friday. The rate of the 10-year Bund fell to 1.67% against 1.72% in last weekend.

"If there is a little relief due to the fact that the second round oppose Sarkozy and Holland, it puts France cantilevered overhang with Germany on the future of the euro," said Marc Ostwald , strategist at Monument Securities.

"And it will not help them move toward the union budget, or to allay market fears about the fact that the only solution lies in Eurobonds."

For many analysts, the uncertainty on the French political situation will remain until the June parliamentary, with the government's announcement will come out and the decisions it will take to reduce die ; ficits budget. 

"If Francois Hollande was actually elected, the tensions in financial markets that French does not dissipate during the summer when the new government would present its plan to return to the balance of public finances in 2017 and would confirm with Brussels, "warns CM-CIC Securities.

THE DUTCH CDS AT THE HIGHEST SINCE JANUARY

Investors are also watching the Netherlands, where Prime Minister plans to resign after the failure of budget discussions undertaken in early March with the PVV party which does not belong to government but who supported Parliament.

"The Netherlands could be a problem because so far it was a stable partner in the euro area. (The Dutch situation) reflects increasing tensions in the area. This is really a problem for the market, "said Christian Stocker, Unicredit

. The spread between borrowing born erlandais 10-year Bund and the reference is widening 12 bps to 73 bps and that of the Spanish loan of 7 bps to 432 bps, the Spanish rate in excess of 10 years to the new 6%

. In the market for CDS (Credit Default Swaps) sovereign, a sort of insurance policy against a default, the spread of title 5 years in the Netherlands in the morning hit its highest level since January to 128 bp (9 bp) and that of France is back above the 200 bp Matiné e, to 207 bp (8 bp), according to data from Markit

. On the equity side, the CAC 40 lost 1.69% to 3.134.69 points, the benchmark index of the Paris Bourse now showing a loss of 0.79% since the beginning of the year.

The decline in the CAC 40 is less pronounced than that of the Frankfurt Stock Exchange, whose index DAX, more industrial, abandoned 2.49%, and that the pan-European Euro Stoxx 50 index (-1.97 %).

Instead of Amsterdam loses 2.44% and 2.77% in Madrid.

"There is no real penalty in particular France, the declines are fairly uniform. Should there really be a sanction of scholarships, it would happen more after the results of the second round. For now, the market is more patient, "said Yohan Salleron Mandarine Gestion fund manager at

. The market reaction to concerns about the political future of the euro area is all the more violent it comes at a contecte economic recession

. The index of manufacturing activity in the euro area, distributed in the morning, fell to 46.0, the lowest since June 2009, against 47.7 in March and 48.0 expected. Above all, the German manufacturing sector contracted at its strongest pace in nearly three years, casting doubt on the capacity of the largest economy in the euro area increase growth in the region

. In China, the activity index still reflects a contraction in the manufacturing sector (49.1 against 48.3 in March). But the situation seems to improve with a rebound in the sub-index of orders to 48.9 against 47.4 in March.

Suez Environnement on Friday issued a gross operating income (EBITDA) fell by 5.5% at constant exchange rates in the first quarter, hurt by falling volumes of waste treated by the group in Europe in difficult economic times.

The world's second largest environmental services, however, has expressed confidence in its ability to achieve its 2012 objectives, which include sales and EBITDA at least identical to those of 2011 at constant exchange rates and a dividend greater than or equal to 0.65 per share for 2011.

It was also announced in February that it was an EBITDA of at least 2.7 billion euros in 2013 (at constant exchange rates) and a ratio of net debt EBITDA maintained at about 3 , 0. 

Suez Environnement recorded in the first quarter EBITDA of 566 million, down 4.5% (-3.4% organic), and a turnover of 3.591 million, up 2.2% (+ 0.9% at constant exchange rates and 1.4% organic).

The group "plans to strengthen its efforts to profitability and free cash flow generation for 2012", informed the Director General Jean-Louis Chaussade, without elaborating.

The group announced in February that it was within 300 to 360 million euros of its goal of reducing costs for the period 2010-2012, made up of 250 million at end 2011. 

For activities, organic growth reached 2.8% in the first quarter in Water Europe and 1.2% in the Waste Europe activities, which have benefited from a price "generally positive" but also experienced a decline in volumes.

International segment sales grew 0.4% organically, an increase that would have been 2.3% outside the desalination plant in Melbourne, Australia, whose construction has struggled in 2011 but is now "being finalized".

The Suez Environnement on Thursday completed a course of 10.625 euros, rising to around 16% since the beginning of the year after a plunge of 42% in 2011.

Prime Minister Francois Fillon, has validated this weekend's decision to notify Thales a contract worth several billion euros for the modernization of tactical radios of the French armies, writing Le Figaro Tuesday.

The contract, three to four billion euros over 22 years, involves the renewal of 33,000 radio systems used by the military, the paper recalls.

The Ministry of Defence had agreed but of Economy objected to the notification of an important contract in its presidential campaign. Matignon has ruled.

The reforms adopted by Portugal to consolidate its public finances are on track and the country should be able to borrow again in the markets in 2013, as planned, said Tuesday the Europe Commission ; enemies.

Portugal received last year for a bailout of 78 billion euros over three years of the European Union and the International Monetary Fund after seeing its rate 'market borrowing to rise to an unsustainable level of debt for the country, whose growth is affected by low competitiveness.

This aid package was not fully reassured investors, some fearing that Lisbon does not follow the way of Greece requesting a new bailout that could mean losses for creditors of the private sector. 

"The program (reform) is broadly on track. Fiscal adjustment in 2011-2012 was remarkable in every respect, "said the third report of the European Commission on Reforms in Portugal ……. The

.. payment of a portion of the money promised by international creditors is dependent on compliance by the Lisbon reform objectives, subject to close monitoring EU, IMF and European Central Bank

. "Portugal fully complies with its contract," said, in the condition of anonymity, a European official who attended the presentation of the report

. Asked whether Lisbon could have need a second aid plan in case it would be impossible to borrow on the markets, he was optimistic

.. ……. "We feel that this plan is sufficient. But that's another question whether Portugal will be able to convince the markets, "he said

." At the moment, we estimate that the program is ongoing and that Portugal should be able to return to the markets in 2013, "said the European official, noting that the yields of Portuguese paper have already begun to decline secondary market

. The bond yield fell to ten years to 11.8%, against 17.4% in late January ..

……. The EC nevertheless warned against "the continuing risks and challenges", including a possible rise in unemployment to above expectations, 14.4% for 2012. The unemployment rate reached a record level of 15% in February, according to Eurostat data.

While Portugal is experiencing its worst recession since the 1970s, the government expects economic contraction of 3.3% this year and a 0.3% growth in 2013 .

Registrations of new cars in France fell by 23.5% in March in raw data, reflects a comparative worst than ever in 2011 when the scrappage dopait sales further.

Renault shares (-1.83%) and PSA Peugeot Citroen (-2.61%) have the largest declines in the CAC 40 index which is 0.43% while the Stoxx sector index of 'European automotive advance of 0.34% to 9:45.

Last month, he registered 197,033 new passenger cars in the Hexagon. After adjustment for working days, the decline appears to 20.0% in March 2012 that were 22 days as against 23 in March 2011, announced Monday the Committee of French Automobile Manufacturers (CCFA).

In January and February this year, the market had already experienced declines of around 20% in raw data, the backlash level of registrations recorded on the pe same period of 2011 through to last orders "cash for clunkers" that could be delivered until March 31 of last year.

"This downturn is spectacular but it was expected," said Flavien Neuvy, Director of the Cetelem automobile. "We still think that most of the decline in yeara was performed in the first quarter and that the scenario of two million vehicles over the year remains relevant in light of new orders and new models coming. "

CCFA has also maintained its estimate of a decline of about 10% of the French automotive market in 2012.

For PSA Peugeot Citroen, which has teamed up in February at General Motors, registrations in France plummeted 33.2% last month while the Renault-including the diamond brand and low cost Dacia brand registrations stand-fall of 29.8%. 

Throughout the first quarter, the French automotive market will be contracted by 21.7% unadjusted and 22.9% when adjusted for working days.

Registrations of PSA for the period fell by 30.3% and Renault's 30.2%, in gross terms in both cases. In contrast, those of the Volkswagen group declined only 2.3%.

The six major Greek banks have decided to participate in the exchange of bonds to alleviate the country's debt, said Tuesday the Ministry of Finance.

Banking sources had previously indicated that all Greek banks concerned should participate in the agreement, which will lead to institutions interested in losses on their holdings ranging up to 74%.

The exchange of securities, if implemented, should lead to cancel some 100 billion euros of debt. Private creditors, mainly banks, insurers and investment companies, have until Thursday to announce their intentions.

Most pension funds holding Greek debt to Greek State agree to participate in the bond exchange, but four refused to do so, it was also learned Tuesday Aupre s head of a Greek.

Unions fear the consequences of the depreciation of assets in debt to Greek pension funds.

Eight or nine pension funds agreed to participate but funds for journalists, police, business owners and employees of the hotel, which hold for about two billion euros debt, refused, sources said.

The number of ruptures conventional employment contract rose to 289,000 last year, up 13% compared to 2010. Candidates are lining up a pile of resumes by hand at a job fair at the University of Virginia Tech in March 2009.

27,016 ruptures amicably were approved in December, up nearly 4% from the previous month and 13% compared to December 2010, according to the assessment updated in 2011 by DARES (Ministry of Labour ). In total, 288,988 conventional ruptures were registered throughout the year 2011, again a 13% increase over 2010. The rate of inadmissibility and for refusal are on their side remained stable (respectively about 3 and 6%). Since its inception, and nearly 770,000 are conventional ruptures that have been validated.

U.S. stocks ended little changed Tuesday after a session hesitant investors welcoming the agreement on a second level of aid to Greece while being tempted by some profit taking.

The Dow Jones gained 0.12% or 15.82 points to 12,965.69 points. The Standard & Poor's, wider, ended almost stable with a gain of 0.07% (0.98 points) to 1,362.21 points. The Nasdaq composite fell 0.11% or 3.21 points, to 2,948.57 points.

Markets were closed Monday for President's Day.

Under the deal pulled off by the euro area after thirteen hours of negotiations, Greece will see the debt burden reduced by EUR 130 billion of government loans and restructure the debt held by private creditors.

This plan can eliminate the risk of a Greek default in March but not solve all economic problems Greek temper analysts. Furthermore, the good news was expected.

In this context, it was tempting for investors who played the recent rise in the market to take some profits, especially as, in session Tuesday, the Dow Jones briefly topped the 13,000 points for the first time since May 2008.

Signs of improvement in the U.S. economy and the stabilization of the debt crisis in Europe helped the Dow Jones gaining over 20% since late 2011 and the S & P gain of more than 8% since the beginning of the year.

"We face a little selling pressure given the rebounding lately," said Fred Dickson, market specialist at DA Davidson & Co.

Values, Kraft Foods has gained 1.47% to 38.57 dollars. The food group provides an earnings growth of at least 9% this year.

Home Depot has nibbled 0.45% to 46.92 dollars. The chain of hardware stores has published a quarterly profit above the expectation.

Macy's has won 1.22% to 36.69 dollars. The operator of department stores reported revenue up and expected a further increase in its turnover this year.

Apple gained 2.5% to $ 514.85. The U.S. International Trade Commission (ITC) ruled that the manufacturer of the iPhone was not about infringement of a patented technology of mobile phone manufacturer HTC.

In contrast, Wal-Mart Stores fell 3.85% to 60.07 dollars. The worldwide distribution generated fourth-quarter earnings below the consensus due to lower prices for customers during win the holiday season and New Year.

The period of publication of quarterly results is nearing completion. According to Thomson Reuters arrested Tuesday morning on the 418 companies in the S & P have published their accounts, 64% show better than expected results This is a lower rate than in recent quarters.