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Stories Report on Business is following today:
Financial markets rebound
Global stocks are rebounding this morning after yesterday's turmoil. Asian stocks finished their day higher, Europe's main exchanges rose between 1.5 per cent and 2.4 per cent, and Dow Jones industrial average and S&P 500 futures pointed to a better open on Wall Street.
"Investors remain concerned about the stability of the European banking system, and the financial viability of sovereign governments," said CMC Markets analyst Michael Hewson. "Bank borrowing costs (Libor) continue to rise and have risen to their highest levels since July last year on concerns about the integrity of the European banking system."
The Canadian dollar was just about flat at just shy of 94 cents cents (U.S.) at about 8:30 a.m. ET.
"Things feel better than they did yesterday, although there's still tremendous uncertainty," said Scotia Capital currency strategist Camilla Sutton.
OECD raises forecast
An OECD report this morning illustrates how the global economy is sitting on a razor-sharp knife edge. The Paris-based Organization for Economic Co-operation and Development said in a semi-annual outlook that the economy is rebounding from the recession faster than anticipated, but the debt hangover in some countries and the potential for overheating in others puts the recovery at risk.
In its forecast for the world's developed economies, the OECD pegged global growth at 4.6 per cent this year and 4.5 per cent. And, in a particularly bright note, said unemployment may have topped out at about 8.5 per cent, well shy of its previous forecast.
Canada's economy is doing particularly well in "rebounding vigorously from the recession trough, helped by a recovering trade sector and policy measures." Its outlook is not without warnings, though, particularly as "the high rate of household indebtedness is a source of risk to the outlook."
The pace of recovery will moderate, the OECD said, as government stimulus wanes. The OECD also said the bank of Canada should begin pulling back from its extraordinary measures "without delay."
On the jobs front, the OECD predicts the unemployment rate will fall to 7.9 per cent this year and 7.2 per cent next.
Read
Raise rates 'without delay,' OECD says
OECD boosts global growth forecast
Europe's debt crisis looms over nascent economic recovery
BMO tops estimates
Bank of Montreal kicked off second-quarter reporting among Canada's major banks this morning by easily topping analysts' forecasts. BMO posted a profit of $745-million, well above the $387-million of a year earlier. BMO's cash earnings per share rose to $1.28, compared to Street estimates of $1.10. Read the story
EU unveils bank tax proposal
The European Commission today unveiled a proposed blueprint for a new tax on banks and plans to take a leading role in pushing for global co-ordination for a levy at the upcoming G20 summit in Canada. The plan would see the banks effectively pay for any troubles down the road.
"I believe in the 'polluter pays' principle," said Michel Barnier, who heads up the EC's push to strengthen financial regulations. "We need to build a system which ensures that the financial sector will pay the cost of banking crises in the future."
But the move threatens to become a divisive issue at the summit of Group of 20 leaders, particularly where Canada is concerned. Prime Minister Stephen Harper and Finance Minister Jim Flaherty have said repeatedly they oppose such a global tax, and, in Canada's case, banks should not be punished given how well they came through the financial crisis." Read the story
France eyes later retirement age
Europeans are going to have to work longer. Some countries have already raised the legal retirement age, and France will be the next to take such as move.
France's labour minister, Eric Woerth, said in a television interview today that his government will up the retirement age beyond 60. "It's logical, it's happening in all countries. I haven't seen any convincing alternative propositions."
State pensions have to fund longer life expectancy, and debt-burdened governments in Europe have been taking similar action.
Analysts see big money for Nortel patents
Analysts believe Nortel Networks Corp. could bring in more than $1-billion (U.S.) from the sale of patents, a boon for creditors of the collapsed technology giant. Bloomberg News reports this morning that, according to data provided by an analyst, Nortel has almost 4,500 patents and just shy of 965 applications in the U.S.
Those should be worth some $1.1-billion, and would be a "natural fit" for Research in Motion Ltd. , Peter Conley of MDB Capital Group told the news agency.
"Patent estates of this size don't come along that often," said Mr. Conley. "This is the equivalent of acquiring the IP of a large technology company. If you could buy that for a billion dollars, it would be a bargain."
Nortel has already brought in almost $3-billion from asset sales.
BP aims for 'top kill' in Gulf
All eyes are on the Gulf of Mexico today as BP PLC tries to plug its leaking oil well with a so-called 'top kill' plan. Whether or not it goes ahead still awaits approval from the company's chief executive officer. BP says there's a 60-per-cent to 70-per-cent chance the plan will work. The energy company plans to pump extremely heavy liquids into the well. The stakes are high given that such a move has never been attempted at such depths and comes amid growing frustration among U.S. politicians.
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