1 May 2010 - Global Markets Review

Good Morning Ladies & Gentlemen,

To start this Newsletter, I thought that I would cover a 'tongue-in-cheek' headline that I read yesterday:

"Americans 'Fat, Dumb, Happy' Lagging in Education, Broad Says"!

Echoing my sentiments a little I feel.

Complacency about education has put U.S. workers at a disadvantage competing in a global marketplace, said Eli Broad, the Los Angeles philanthropist who has crusaded for a decade to improve student achievement.

"The American people frankly have been over many, many years, to be blunt, fat, dumb and happy," said Broad, 77. "If they want their children to compete with children in India, China or Korea, they better get them a far better education."

The U.S. ranked 21st with 78 percent of high school students graduating and going on to college in 2007, according to a 2009 survey by the Paris-based Organization for Economic Cooperation and Development, which promotes economic growth, employment and higher living standards. Germany and Finland led with rates of 97 percent or more.

Broad, who has sought to improve instruction and student skills, said he wants his Eli and Edythe Broad Foundation to devote the next 10 years to influencing state and national education policy, and to promote a standard national curriculum for mathematics and science.

"The biggest problem we have in America is governance," he said. "You cannot compete with national education ministries and have 15,000 school boards. It's going to take more direction at the national level."

Broad started his nonprofit in 1999 partly to bolster education at a time when U.S. students' reading, math and science achievement scores had been declining.

A Michigan State University graduate, Broad made his first fortune as co-founder of Los Angeles-based KB Home, a home building company he started in 1957 with Donald Kaufman who died last year. Broad later pocketed $3.4 billion when sold his 19 percent stake in insurer SunAmerica Inc.

A lover of art with a 2,000-piece collection, Broad became a major supporter of museums and a co-founder the city's Museum of Contemporary Art. A Democratic Party donor, Broad said he supports California Attorney General Jerry Brown Jr.'s candidacy for governor.

Broad isn't alone in calling for improved education. In a Milken Institute panel in Los Angeles this week, economist Nouriel Roubini said investing in education and technology would benefit the U.S. economy more than spending on housing.

In the past decade, Broad has invested about $370 million in programs to improve instruction and student learning. About $100 million has been awarded to charter-school management organizations, creating 54,474 slots for students in 16 cities, Broad Foundation spokeswoman Karen Denne said in an e-mail.

Broad also set up the Broad Center for the Management of School Systems to train school superintendents and recruit top education managers from other professions. He established the $2 million Broad Prize for Urban Education, awarded to school districts that show the greatest improvement in student achievement.

Students need a longer school year and better instruction in the schools, Broad said. The best teachers and principals should be put into the "most challenging" schools, he said.

"In other countries, they take the top 10, 20 or 30 percent of the students and make them teachers," he said. "We get the bottom 30 percent out of education schools."

Broad said he is also seeking reform of school boards because they fail to address student achievement issues, and "we will see statutes that will limit their power" or define their role more clearly.

"You rarely find (school boards) talking about standards or student achievement," he said. "That's why you got to have more of that input coming from Washington at the national level and governors and big city mayors."

The article goes on .... but I think you get the gist of things.

And in truth, he has a point. But if you have managed to make a cool $30 billion out of the system, that system simply has to be flawed does it not!

And nicely on to ..... Expo! How on earth could I not mention this today. And for that matter, how could the Financial Times not mention it - here is what they had to say about last night:

Shanghai staged an extravagant display of pyrotechnic power, on Friday, to celebrate the opening of the largest world expo in history, underlining the emergence of China - strong, prosperous and triumphant - from the global financial crisis.

Conceived as the second act in the dramatic re-branding of China which began with the 2008 Beijing Olympics, on Friday's performance, which was attended by a number of world leaders including Nicolas Sarkozy, French president and José Manuel Barroso was, European Commission president, billed by organisers as the largest outdoor multi-media show in history.

The 30-minute outdoor performance, produced by David Atkins Enterprises, an Australian event production company, was held on a 3.4km stretch of Shanghai's murky Huangpu River, which was turned blood-red as part of the show.

Organisers used a string of superlatives to describe the show, which was staged to celebrate what they called "the largest peacetime event in history", the Shanghai Expo, which runs from May 1 to October 31 and is expected to attract 70m-100m people, the vast majority of them from within China.

Millions of people all over Shanghai craned their necks for a glimpse of what organisers said was the largest searchlight display in history, the largest collection of multi-coloured laser firepower ever assembled in one place, the world's largest LED screen, one of the largest dancing water fountains ever, and the "largest light show ever attempted".

"Sorry about the superlatives, but it can't be avoided," said Ignatius Jones, artistic director for David Atkins.

Some 6,000 LED balls were released into the Huangpu river to simulate fish, which symbolise good fortune in Chinese; forming themselves into the Chinese character for 'harmony', they highlighted one of the most consistent themes of the show - and of the Chinese government: Beijing's aspiration to create a 'harmonious society'.

Shanghai's futuristic landscape of skyscrapers were also roped in to perform, decked out in brand-new neon lights which staged a city-wide synchronised light show as part of the ceremony. Spectacular firework displays went up from land, buildings and barges on the Huangpu river, culminating with an all-red display of firepower and lasers, and a climactic explosion set to Beethoven's Ode to Joy. Two floating Ferris wheels were unveiled on other barges.

Shanghai government officials refused to say how much the event cost, but Yang Xiong, vice mayor of Shanghai said earlier this week that it was much less than the opening ceremony of the Beijing Olympics. The Expo itself is estimated to cost between $55bn and $95bn, including infrastructure improvements like the addition of several new metro lines, two to three times the cost of the Beijing Olympics.

Critics of the show questioned the opening's extravagant usage of electricity could be consistent with Shanghai Expo's theme of environmental sustainability. David Atkins Enterprises said use of energy saving technologies reduced power consumption by 55 per cent from what would otherwise have been the case.

Premier Wen Jiabao has said that staging such an Expo is a 100-year old dream come true for China - aimed, in the words of one late 19th century Chinese thinker, at ensuring that the "the sleeping lion", can be " woken up from the deep dream and cured of its protracted illness".

Shanghai declared a five-day public holiday from May 1 to May 4 to reward residents for living in a building site for years due to Expo preparations. Each resident will also get a free Expo ticket and Rmb200 transport car; an expensive exercise that captures the city's sense of its healthy finances.

So, if they are giving away 20 Million Expo tickets, now we know where a chunk of those expected visitors are coming from!

On to the numbers on the boards this week:

US Markets

How the US did this week .....

US Summary US stocks tumbled, capping the biggest weekly drop since January, as criminal investigators took aim at Goldman Sachs Group Inc. and technology shares slid after MEMC Electronic Materials Inc. posted a loss.

Goldman Sachs sank 9.4% to the lowest since July as people familiar with the matter said federal prosecutors are exploring whether to bring a criminal fraud case. Barclays Plc plummeted in US trading after investment banking at the UK's third-largest bank missed estimates. MEMC, which makes silicon wafers, sank 19%. Transocean Ltd. tumbled 7.9% as the White House banned new offshore drilling until the Gulf of Mexico oil spill is investigated.

The Standard & Poor's 500 Index retreated 1.7% to 1,186.69 at 4 p.m. in New York, extending its weekly retreat to 2.5%. The Dow Jones Industrial Average plunged 158.71 points, or 1.4%, to 11,008.61 and lost 1.8% over the past five days, snapping an eight-week streak of gains, which was its longest rally since 2004.

The Goldman Sachs-led slump in financial shares overshadowed rallies in Sunoco Inc., D.R. Horton Inc. and others on better-than-estimated earnings and further evidence the US recovery is holding firm. The economy grew at a 3.2% annual rate last quarter, compared with 3.3% forecast in a Bloomberg survey and 5.6% gain in the fourth quarter. Consumer spending rose 3.6%, the most in three years.

The S&P 500 has surged 75% from a 12-year low in March 2009 as earnings returned to growth following a record nine-quarter slump and the Federal Reserve kept its benchmark interest rate at a record low to safeguard the recovery from recession.

Goldman Sachs tumbled 9.4% to $145.20 to extend its April decline to 15%, its worst month since October 2008. Bank of America Corp. cut its recommendation to "neutral" from "buy," citing media reports indicating federal prosecutors are investigating the firm. Bank of America also slashed its price estimate on the shares to $160 from $220, according to a report dated Friday.

Prosecutors in New York are investigating transactions by Goldman Sachs after the Securities and Exchange Commission sued the firm two weeks ago on accusations of misleading investors in collateralized debt obligations. The federal review, which lawyers say is common in such a high-profile case, is being done by the US attorney in Manhattan, said the people, who weren't authorized to comment and spoke on condition of anonymity.

US shares of Barclays Plc slumped 8.6% to $20.42. First-quarter investment banking revenue dropped more than estimated. Revenue at the Barclays Capital unit slumped 26% to 3.8 billion Pounds ($5.8 billion) for the three months to March 31.

MEMC plunged 19% to $12.97 for the biggest decline in the S&P 500 and the stock's largest drop since July 2008. The maker of silicon wafers for solar modules and semiconductors reported a first-quarter loss as prices for both products declined and administrative expenses doubled. Analysts had forecast a profit.

Transocean, whose Deepwater Horizon rig caught fire and sank last week, tumbled 7.9% to $72.32. Halliburton, the second-largest oilfield contractor and a service provider on the Deepwater Horizon, declined 3% to $30.65. McMoRan, a New Orleans-based oil and gas producer that's drilling in the Gulf, dropped 8.6% to $11.94.

McAfee Inc. slumped 12% to $34.75. The second- biggest maker of security software reported first quarter profit that missed analysts' estimates after some customers put off large purchases of programs designed to protect computers from malicious software. The company's rating was cut to "market perform" from outperform" at Wells Fargo Securities

Nasdaq OMX Group Inc. sank 3.9% to $21. The securities exchange operator missed the average analyst earnings estimate as US stock trading slowed. Excluding some items, first-quarter profit at Nasdaq was 43 cents a share, missing the 46-cent average estimate of 22 analysts surveyed by Bloomberg.

Massey Energy Co. dropped 11% to $36.63. The coal producer is being probed by the Federal Bureau of Investigation with regard to the explosion at one of the company's mines in West Virginia, NPR reported on its website, citing people familiar with the investigation.

Sunoco had the biggest gain in the S&P 500, surging 4.3% to $32.78. The oil refiner reported profit of 14 cents a share after the market close Thursday, beating the average analyst estimate in a Bloomberg survey for a loss of 14 cents.

D.R. Horton surged 3.2% to $14.69. The second- largest US homebuilder by revenue reported its second straight quarterly profit as buyers purchased property in time to beat the deadline for federal tax credits. Net income was $11.4 million, or 4 cents a share, for the fiscal second quarter ended March 31, compared with a loss of $108.6 million, or 34 cents, a year earlier. Analysts in a Bloomberg survey forecast that D.R. Horton would break even.

Discovery Communications Inc. rose 3.3% to $38.73. The owner of the Discovery Channel and Animal Planet cable channels increased its revenue forecast to as much as $3.78 billion from as much as $3.75 billion. The company also reported first-quarter profit of 39 cents a share, beating the 34-cent average analyst estimate compiled by Bloomberg.

Profit at companies in the S&P 500 surged 176% during the final three months of 2009, the most in Bloomberg data going back to 1998, and analysts estimate a 47% increase for the first quarter of 2010. Earnings estimates for companies in the index rose 10% on average in April, the largest monthly increase since at least 2006.

Income for the first three months of this year is beating estimates at nearly the fastest rate ever, with 77.9% of the companies that have reported topping projections. That compares with 79.5% in the third quarter and 72.3% in the period before that.

European Markets

What has been happening in Europe this week .....

Europe Summary European stocks fell as a decline in Barclays Plc and a sell-off in basic-resource shares overshadowed optimism that a bailout for Greece is imminent.

The benchmark Stoxx Europe 600 Index lost 0.7% to 259.91, extending its monthly decline to 1.4%. The gauge has still rallied 64% from a 12-year low reached in March 2009 amid signs the global economy is recovering from the worst recession since World War II.

National benchmark indexes fell in 10 out of 18 western European markets. Germany's DAX lost 0.2%, France's CAC lost 0.6% and the UK's FTSE 100 decreased 1.2%. In Greece, the benchmark index soared 2.2%.

GERMANY

German stocks dropped, with the benchmark DAX Index extending its decline for the week and for April, as a first-quarter loss at Metro AG overshadowed gains at Siemens AG and RWE AG.

Metro AG retreated 1.1% after reporting a first- quarter loss. Siemens and RWE led advancing shares, rising at least 1.4%.

The benchmark DAX lost 0.2% to 6,135.70, bringing this week's decline to 2%. The measure slid 0.3% this month. Stocks have fallen this week after Standard & Poor's downgraded the credit ratings of Greece, Portugal and Spain. The HDAX Index dropped 0.2% Friday.

Metro fell 1.1% to 45.16 Euros after reporting a first-quarter loss.

Siemens, Europe's largest engineering company, rose 2% to 74.34 Euros, while RWE advanced 1.4% to 61.86 Euros.

Altana AG dropped 2.3% to 16.45 Euros after the world's largest maker of additives for coatings and plastic parts said SKion GmbH, which holds more than 95% of its shares, fixed the squeeze-out price for the remaining shareholders at 15.01 Euros per share.

German wholesale trade turnover increased 2.1% year-on-year in the first quarter in nominal terms and 0.3% in real terms, the Federal Statistical Office said Friday.

In March, wholesale trade increased 7.8% in nominal terms and 4.6% in real terms compared with the corresponding month of the previous year.

When adjusted for calendar and seasonal variations, the March turnover was in nominal terms 2.1% and in real terms 0.7% larger than that in the preceding month, the statistical agency said.

German agreed monthly earnings of employees rose an average 2.3% annually in January, the Federal Statistical Office also reported. Earnings were up 3% in the previous comparable period, in October.

The statistical agency said not all persons employed under collective agreements benefited fully from the agreed pay increases because of short-time work, the reduction of extra payments, and the temporary suspension of agreed pay rises through opening clauses.

FRANCE

France's CAC 40 Index declined 23.63, or 0.6%, to 3,816.99 in Paris, for a 4% drop this month. The SBF 120 Index lost 0.6%.

ArcelorMittal sank 99 cents, or 3.2%, to 29.66 Euros, a fourth straight decline. Chief Executive Officer Lakshmi Mittal told the Financial Times that the approaching increase in the cost of iron ore could make steelmaking 33% more costly.

While the company has extensive iron-ore-mining operations, which will partly insulate it from the effects of the price rise, the mines are mostly far from its European plants, the FT said. The result will be that the company's European output will be less competitive, the newspaper cited Mittal as saying.

Michelin & Cie advanced 2.6% to 54.87 Euros, gaining for a second day. The world's second-biggest tiremaker said first-quarter revenue rose 12% to 3.9 billion Euros ($5.2 billion), led by a rebound in sales to truckmakers in Latin America and Asia and to logistics companies.

Technip, Europe's second-largest oilfield- services provider, lost 2.5% to 60.50 Euros, falling for a third day this week. The stock was cut to "sell" from "hold" at Standard & Poor's.

Total slipped 2.6% to 40.97 Euros, declining for a third day this week. Europe's third-biggest oil company reported first-quarter adjusted net income of 2.3 billion Euros. That compares with the average analyst estimate of 2.37 billion Euros.

Vallourec, the world's second-biggest maker of steel tubes for oil and gas production, rallied 1.4% to 150.45 Euros, gaining for a second consecutive day. Crude oil rose to a two-week high as a weaker Dollar bolstered the appeal of commodities to investors and after a report showed the US economy grew in the first quarter, signaling that fuel demand will increase.

The producer price index or PPI in the French market increased 0.6% on a monthly basis in March, faster than the 0.1% growth in the previous month, the statistical office INSEE said on Friday. The producer price inflation came in line with economists expectations.

On an annual basis, the PPI rose 2% in March, faster than the 1.9% expected by economists.

Producer prices in the foreign markets increased 0.4% month-on-month in March, the PPI for all markets rose 0.5%.

French consumer confidence indicator slipped for the third consecutive month in April amid lingering concerns over the strength of the economic recovery.

The consumer confidence index decreased to minus 37 in April from minus 34 in March, the National Institute of Statistics and Economic Studies or INSEE said Tuesday. It was the lowest reading since July 2009. Economists were looking for a reading of minus 33. The indicator has been decreasing since February 2010, after registering moderate improvement last year, INSEE said.

Households' expectations on general economic situation for next 12 months deteriorated further in April by four points after a six point drop in March. The relevant indicator showed a reading of minus 46 compared to minus 42 in the previous month. The view on past general economic situation slightly deteriorated with the relevant indicator easing to minus 69 from minus 68.

Consumers have become slightly more pessimistic in April about their future financial situation with the indicator falling to minus 15 from minus 13 in the previous month. Compared to March, less number of people believe that coming 12 months is an appropriate time to make major purchases. The corresponding indicator went down to minus 27 from minus 24 in the previous month.

Fears about an increase in unemployment still loom large among households as the corresponding indicator showed a slight increase of one point. In March, the indicator gained four points.

A larger number of households said inflation has increased in the past as the corresponding balance of opinion gained six points in April. The balance of opinion on expected inflation increased by four points.

Households' opinion on their current financial situation is stable and remained higher than its long-term value. However, households' belief in their capacity to save worsened by one point along with their saving intentions, which also went down by one point.

In March, INSEE slashed its first quarter growth forecast for the French economy. The second-biggest Eurozone economy is expected to grow 0.2% sequentially, after expanding 0.6% in the final three months of 2009. The statistical office said France's less pronounced rise in unemployment is the result of the gradual upturn in activity, and should continue through coming quarters.

BELGIUM

The Bel 20 in Brussels closed out the trading session Friday at 2,560.99, down 0.03%.

Belgium's expansion slowed in the first quarter as harsh weather hampered the economy's recovery from the worst slump in at least six decades.

Gross domestic product in Belgium, the first Euro-zone nation to report first-quarter GDP data, expanded 0.1% from the fourth quarter, when it gained 0.3%, the National Bank of Belgium in Brussels said Friday.

European governments are trying to bolster the recovery while seeking ways to tackle budget deficits, which swelled last year as policy makers rolled out measures to fight the recession. At the same time, Greece's budget crisis is rippling through the region, hurting the Euro after Germany's reluctance to approve emergency funds sparked contagion concerns.

The Belgian data could be "an indication that GDP growth may be lackluster throughout the Euro zone in the first quarter," said Dominique Barbet, an economist at BNP Paribas in Paris. While "cold weather and heavy snow distorted the economic activity in January," he said "business surveys suggest a much stronger second quarter."

Business sentiment in Belgium, the sixth-largest economy among the 16 nations using the Euro, improved more than economists forecast this month, the central bank said last week. Business confidence in Germany, Europe's biggest economy and one of Belgium's largest trading partners, jumped to the highest in two years.

Belgium also faces the uncertainty of possible early elections after Prime Minister Yves Leterme's coalition collapsed this month amid a deadlock over a disputed voting district. Belgium, which takes over the European Union's six- month presidency on July 1, has gone through four governments since elections in 2007 produced a political stalemate.

Exmar NV, the Antwerp-based operator of the world's largest fleet of midsize gas tankers, said Friday that first-quarter earnings fell about 39%. Tessenderlo Chemie NV, the world's third-largest producer of animal-feed phosphates, said its quarterly loss narrowed to 5.1 million Euros ($6.8 million) from 6.2 million Euros a year earlier.

From the year-earlier period, Belgium's first-quarter GDP increased 1%, after a 0.8% drop in the previous quarter. That was the first annual increase in output since the third quarter of 2008.

Belgium's King Albert II has accepted the resignation of the government led by Prime Minister Yves Leterme, following collapse of the ruling coalition after failure at resolving issues between partners, said officials on Monday.

"The King has accepted the resignation of the Government," the Palace said in a statement issued Monday. "The King has tasked the government to continue in a caretaker capacity."

Prime Minister Yves Leterme had offered to resign on Friday because of a long standing dispute between the coalition partners over the political rights of French and Flemish speakers in a bilingual voting district in and around Brussels.

It was Leterme's third offer to resign since July 2008, after a liberal Flemish party quit the government over plans to redraw the boundaries of the Brussels Halle-Vilvoorde electoral district.

King Albert, who indicated on Friday that he will wait for a week before accepting the resignation, had entrusted finance minister Didier Reynders to try and resolve the differences between the coalition partners.

The King's decision to accept the government's resignation came after Reynders asked Monday to be relieved of his three-day mission, indicating that he had failed in his efforts to patch up the differences between the two sides. Fresh elections are now expected to be called in early June.

Belgium is divided linguistically into French-speaking southern Wallonia, Dutch-speaking northern Flanders and the officially bilingual Brussels in between. The language used on the sign boards and all other documents, including mortgages, divorce papers and elections ballots, in each of the regions is currently determined by language rules based on this division.

The current differences between the ruling coalition is over a proposed plan to redraw the boundaries of the bilingual Brussels Halle-Vilvoorde electoral district after the country's Constitutional Court ruled in 2003 that district would have to be reapportioned.

The Brussels Halle-Vilvoorde electoral district is currently made up of the officially bilingual Brussels and some 20 Dutch-speaking towns around the capital city. The Flemish politicians are demanding that the parts of the district be made monolingual, while the French speaking politicians want to the voters in the district to be able to support French political parties.

THE NETHERLANDS

In Amsterdam, the AEX finished the day on 345.91, a dip of 0.73% for the day.

Royal KPN NV, the largest Dutch phone company, said first-quarter profit rose more than analysts estimated as job cuts offset a drop in sales in the Netherlands.

Net income advanced to 448 million Euros ($599 million), or 28 cents a share, from 317 million Euros, or 19 cents, a year earlier, The Hague-based company said in a statement Friday. Analysts had predicted a 405 million-Euro profit, the average of 10 estimates compiled by Bloomberg.

KPN, led by Chief Executive Officer Ad Scheepbouwer, cut 945 jobs in the first three months to protect profitability after customers reduced spending and regulations forced tariff cuts. The company has eliminated 8,512 jobs in the Netherlands since 2005 and said it is on schedule to increase that total to 10,000 this year.

KPN fell 0.5% to 10.97 Euros in Amsterdam trading.

KPN expects to raise prices by 1% to 1.5% in 2010 in the Netherlands, Chief Financial Officer Carla Smits- Nusteling said on a call with reporters Friday, confirming an announcement the company made in December.

The Netherlands' Central Bureau of Statistics said on Tuesday that the country's business sentiment indicator increased to -1.4 in April from -3.1 in March.

The number of businesses that expected an increase in production in the coming three months were higher than those that foresaw a decline, the statistical office said.

Further, respondents' assessments on inventories improved slightly while opinions on new orders was hardly changed.

SWITZERLAND

Zurich's SMI rounded off the week at 6,616.82, declining 0.74% in the process.

The fiscal woes of some Euro area countries posed significant risks for Switzerland, the head of the Swiss National Bank, Philipp Hildebrand, warned on Friday.

Hildebrand told the SNB's general meeting of shareholders that there was a possibility of investors flocking to the Swiss franc as a safe haven currency in the event of the Euro losing its stability, and assured that the central bank will not "allow such a development to turn into a new deflation hazard for Switzerland".

"For this reason, it is acting decisively to prevent an excessive appreciation of the Swiss franc," he added.

Meanwhile, President of the SNB's Bank Council Hansueli Raggenbass said the SNB's balance sheet is in a healthy state and called the bank's decision to increase the allocation to provisions a necessity to ensure the long-term strength of the balance sheet.

"Increasing the allocations to the provisions will help to ensure that the SNB balance sheet continues to meet the high demands on its robustness even after the distribution reserve has been depleted," he said.

The UBS Bank on Tuesday said its consumption indicator for the Swiss economy rose to suggest acceleration of consumption growth.

The UBS consumption indicator rose to 1.71 in March from 1.20 in February, returning to its pre-crisis level of the summer of 2008. The bank said the steep rise in the consumption indicator confirms UBS's optimistic economic outlook that the Swiss economy would grow 2.5% this year.

The consumption indicator is based on five sub-indicators namely, new car registrations, business activity in the retail sector, the number of overnight stays in domestic hotels by Swiss nationals, the consumer sentiment index, and credit card transactions processed by UBS at points of sale in Switzerland. The March rise in the indicator was driven by growth in new car registrations, by 20% year-on-year.

Moreover, the bank said it expects further rise in Swiss consumption indicator thanks to an expected improvement in consumer sentiment and business activity in the retail sector.

The KOF Swiss Economic Institute on Friday said the economic indicator for April rose to 1.99 from a revised 1.96 level in March. Accordingly, annual growth rates of Swiss Gross Domestic Product should be continuously positive in the next few months, the think-tank said.

The institute said the index is stabilizing on a high level and this level was surpassed for the last time in November 2007. The reading came in line with economists' expectations.

Meyer Burger Technology AG, a Swiss maker of saws to slice silicon wafers, aims to triple sales in five years to about 1.5 billion Swiss francs ($1.4 billion) as demand recovers and solar panel makers increase productivity.

"Signs are certainly promising," Chief Financial Officer Michel Hirschi said in a telephone interview on April 23. "We are running at full capacity. We are even increasing the number of machines produced."

Sales will rise this year "if everything goes according to plan," he said. An acquisition and orders worth 250 million francs in March from an unidentified Asian customer helped lift the order backlog to more than 900 million francs from 516.4 million francs at the end of December.

Demand for solar power products dropped last year as the global economic slump made it harder for renewable-energy investors to raise funds. Global sales of solar panels will almost double this year as developers rush to install systems before governments reduce incentives, industry publisher Isuppli said this month.

The Swiss company's share price has jumped almost sevenfold since it went public in 2006, while the Swiss Performance Index has declined 15%. It closed little changed at 27.45 francs in Swiss trading Friday, below its high at 41.80 francs in 2007, giving the company a current market value of 1.2 billion francs.

New orders are still dominated by Asia, followed by the US, while in Europe demand hasn't rebounded, according to Hirschi. European solar companies' profitability has been falling because of competition from China and cuts to state support in Germany and Spain.

In January Meyer Burger acquired 3S Industries AG, a Swiss maker of laminating equipment to produce photovoltaic modules. The combined company had sales of 539 million francs with an operating margin of 14.6%. Meyer Burger should be at least able to hold that margin this year, Hirschi said.

AUSTRIA

The ATX in Vienna headed into the weekend on 2,650.32, in positive territory and up 0.24%.

Austria's Erste Group bank said Friday its first quarter net profit rose 10% amid a slow stabilization in the economically fragile Central and Eastern Europe, though losses on bad loans remained high.

The Vienna-based bank said its net profit in the first three months of the year was Euro255.2 million ($338.29 million), compared to Euro232.1 million during the same period a year earlier.

That was helped by recovering currency values in Central and Eastern Europe as well as higher market valuations on investments.

But in a sign the situation in Central and Eastern Europe is still problematic, Erste's risk costs -- provisions made to account for the likelihood of more loan defaults -- rose to Euro531.2 million in the first quarter, up from Euro370.2 million during the first quarter of 2009. In the fourth quarter of 2009, risk provisions had been a staggering Euro607.4 million.

The company has a presence in the Czech Republic, Croatia, Hungary, Romania, Serbia, Slovakia and Ukraine.

"Erste Group has made a strong start to the 2010 financial year, supported by the gradual improvement of economic fundamentals in Central and Eastern Europe," Erste CEO Andreas Treichl said in a letter to shareholders.

"As a consequence of better profitability, improved securities valuations and currency strength across Central and Eastern Europe, our capital position continued to improve, leading to enhanced capital ratios -- even prior to the inclusion of retained earnings," he added.

Austria's manufacturing purchasing managers' index or PMI rose to 60.3 in April from 56.7 in March, a report by the Markit Economics showed on Thursday. A PMI reading above 50 indicates expansion in the sector while below 50 suggests contraction.

The latest PMI increased to the biggest level since the series started in October 1998, the Markit said.

Production at Austrian manufacturing firms increased for the tenth consecutive month in April as higher new orders. Further, the new business significantly expanded.

The higher new order growth led to a sharp accumulation of backlogs of work in the month of April. Moreover, employment increased for the first time since April 2008.

SWEDEN

Stockholm's OMX rounded off the day Friday on 1,053.88, down 0.74%.

Nordea Bank AB, SEB AB and Svenska Handelsbanken AB, Sweden's three largest lenders by market value, reported first-quarter profits that surpassed analysts' estimates after credit losses declined.

Nordea's net income rose to 642 million Euros ($848 million) from 626 million Euros a year earlier, beating the average 463 million-Euro analyst projection. Handelsbanken's profit climbed to 2.85 billion kronor ($392 million) from 2.77 billion kronor, compared with a 2.42 billion-krona estimate. SEB's net income fell to 674 million kronor from 1.03 billion kronor, topping the average 346 million-krona analyst forecast.

Nordea, SEB and Swedbank AB had posted soaring loan losses in Estonia, Latvia and Lithuania after the countries suffered the steepest recessions in the European Union in the past two years. Swedbank, the largest lender in the Baltic states, said Thursday that impaired credit and loans that are more than 60 days overdue have stopped rising in the region and that the real estate market has "shown signs of recovery."

"The improved business environment has contributed to a decrease of loan losses and a stabilization of the growth of impaired loans," Nordea Chief Executive Officer Christian Clausen said in a statement Friday. "Net loan losses in 2010 are likely to be lower than in 2009. Credit quality continues to stabilize, in line with the macroeconomic recovery."

Nordea climbed 2.90 kronor, or 4.3%, to 70.20 kronor in Stockholm trading. SEB rose 1.22 kronor, or 2.6%, to 48.74 kronor, while Handelsbanken rallied 8 kronor, or 3.9%, to 212.20 kronor.

Net loan losses at Nordea slid 27% to 261 million Euros in the first quarter after lower provisions in Sweden, Denmark and the Baltic countries. At SEB, they fell 19% to 1.93 billion kronor following a drop in Baltic credit losses. SEB said provisions for loan losses won't exceed 5 billion kronor this year, after reaching 12.4 billion kronor in 2009.

"Following the in-depth review of all credits in 2009, we remain confident in our Baltic asset quality and work-out strategy," SEB Chief Executive Officer Annika Falkengren said in a statement. "The lower provisions for Baltic credit losses, 1.4 billion kronor compared with 2.6 billion in the previous quarter, also mirrors the overall stabilization in the region."

Swedbank Thursday reported net income of 536 million kronor for the three months through March, its first quarterly profit since 2008. The earnings beat analysts' estimates, which on average had projected a loss.

Loan losses at Handelsbanken, which was less affected by the credit crisis than many of its Nordic rivals because it doesn't have larger operations in the Baltic states, fell 39% to 551 million kronor in the first quarter. The lender, which is expanding in the UK by adding branches, is the only major Scandinavian bank not to have raised funds from investors or received a state capital injection in the last two years.

Swedish economic sentiment indicator dropped to 105.6 in April from 106.8 in the previous month, a report from the National Institute of Economic Research showed on Thursday. Economists expected a reading of 108.3.

However, the consumer confidence indicator stood at 19.5 in April, up from 15.5 in the previous month. Economists expected a reading of 16. .

Further, a measure for manufacturing confidence showed a flat reading in April, while the confidence indicator on construction stood at minus 15. Total industrial sentiment improved to 17 from 16.

Thursday, the Statistics Sweden announced that the retail sales volume increased a seasonally adjusted 0.7% month-on-month in March, compared to the 1.1% fall in the previous month. Retail sales came in line with economists expectation. A year earlier, retail sales were down 1.1%.

Year-on-year, retail sales rose a working day adjusted 4.1% in March, faster than the 2% growth in the previous month. Economists expected an increase of 4%. At the same time, retail sales for consumables increased by 2.5%, while retail sales for durables grew 5.4%.

Wednesday, the Statistics Sweden announced that the jobless rate stood at 9.1% in March, down from 9.3% in the previous month. Economists expected the jobless rate to be 9.5%. A year ago, the jobless rate was 8.3%.

The unemployment rate was 9.5% for men and 8.8% for women in March, the statistical office said.

The number of unemployed increased by 44,000 persons in March from the previous year to 448,000, while the number of employed totaled 4.45 million.

DENMARK

The OMX in Copenhagen completed a busy week on 411.50, up a huge 2.42% Thursday but the market was closed on Friday.

Vestas Wind Systems A/S, the world's largest maker of wind turbines, reported an unexpected loss after tighter financing led customers to delay renewable- energy projects. The shares fell 4.6%.

Vestas lost a net 82 million Euros ($108 million) in the first quarter compared with profit of 56 million Euros a year earlier, the Randers, Denmark-based company said Friday. That missed the average estimate of a 15.9 million-Euro profit in a Bloomberg survey of 11 analysts, none of whom expected a loss. The order book shrank by 41%, Vestas said.

The credit crisis prompted banks to restrict loans to wind- park developers that buy turbines from Vestas and competitors including Germany's Siemens AG, Gamesa Corp. Tecnologica SA of Spain and General Electric Co. Vestas, which last reported a quarterly loss four years ago, said Friday that it had been "far from utilizing" all its production capacity in the period.

The stock fell 16 kroner to 335 kroner in Copenhagen, the biggest drop since 23 February. That cut the share gain this year to 5.7%.

Vestas kept its 2010 forecasts of 7 billion Euros in revenue and a margin for earnings before interest and tax in a range of 10% to 11%. First-quarter sales fell 32% to 755 million Euros.

Thursday, the Statistics Denmark announced that the seasonally adjusted jobless rate stood at 4.2% in March, same as the previous month. The jobless rate was stable for the fifth consecutive month. Economists expected the jobless rate to be 4.2%.

The number of unemployed persons totaled 116,800 in March, smaller than the 117,300 persons in the previous month.

Danfoss A/S and Danfoss Acquisition Friday announced that their $14.00 per share cash tender offer for all of the outstanding shares of common stock of Sauer-Danfoss not already owned by Danfoss or its subsidiaries expired at midnight, New York City time on Thursday, April 29, 2010, without acceptance of the tendered shares, due to the minimum tender condition not being satisfied.

The depositary for the Offer has informed Danfoss and Danfoss Acquisition that 2,320,531 shares had been tendered and not withdrawn as of the expiration date of the tender offer.

Danfoss Acquisition has instructed the depositary for the Offer to promptly return all shares tendered.

FINLAND

Helsinki's OMX ended Friday's trading session on 6,997.54, a gain of 1.01% for the day.

Finnish oil refining company Neste Oil Oyj (NES1V.HE) Thursday reported a 6.7% rise in first-quarter net profit and said market conditions will improve slowly but steadily.

"The rapid improvement in refining margins seen in February and March, compared to the end of 2009, was a positive surprise to us," Chief Executive Matti Lievonen said.

Neste Oil's net profit was Eur64 million for the three months to March 31, compared with a net profit of Eur60 million during the same period a year earlier, trailing expectations for a net profit of Eur65.5 million, according to a company survey of seven analysts.

Better refining margins in February and March helped results.

Revenue rose 33% to Eur2.73 billion, compared with Eur2.05 billion a year earlier. Analysts had forecast revenue at Eur2.45B.

Operating profit rose to Eur97 million from Eur95 million the previous year, below expectations for Eur100 million.

UPM-Kymmene Corp., the world's largest magazine paper maker, on Wednesday reported a first-quarter net profit of Euro70 million ($93 million) as sales were up 10% in the period.

UPM's revenue in January through March climbed to Euro2.04 billion, from Euro1.8 billion a year earlier. Net loss in the period in 2009 was Euro158 million, the company said.

UPM stock jumped more than 2% to Euro10.87 in early trading in Helsinki.

Despite the improved performance, CEO Jussi Pesonen gave a cautious outlook.

"UPM's operating profit improved clearly from the same period last year due to higher delivery volumes across all of our businesses and lower raw material costs. What is especially positive is that despite the clear increase of delivery volumes our fixed costs remained the same," Pesonen said. "However, our profitability continues to be unsatisfactory and everyday efforts to improve the situation will continue."

UPM said it expects gradual recovery in its main markets to continue and that consumer demand will improve as the global economy begins to recover.

The International Monetary Fund on Monday signed an agreement with the Bank of Finland to borrow up to Eur 1.3 billion from the latter.

The agreement is part of a commitment made by the European Union in March 2009 to contribute up to Eur 75 billion to support the IMF's lending capacity, the global lender said in a statement.

With the signing of the agreement, the Fund can now add these resources to those already available through agreements signed with other members.

These agreements contribute toward an increase in Fund resources that was requested in April 2009 by G-20 leaders and the International Monetary and Financial Committee in order to provide timely and effective balance of payments assistance to its members in the current crisis, the IMF said.

Finnish dwelling prices rose 2.2% sequentially in the first quarter, taking the annual growth to 11.3%, data released by the Statistics Finland showed Friday.

In Greater Helsinki, prices went up by 2.8% quarter-on-quarter and in the rest of the country by 1.7%. Compared to a year earlier, prices were up 15.7% in Greater Helsinki and in the rest of the country by 7.7%.

In the first quarter of 2010, the average price per square metre of an old dwelling in a block of flats was Eur 2,071 in the whole country, Eur 3,169 in Greater Helsinki and Eur 1,576 elsewhere in the country.

Further, the statistical agency said a total of 71,00 transactions of old dwellings in blocks of flats were completed in the whole country in the year 2009.

Business confidence in Finland strengthened in April, latest figures show.

The Confederation of Finnish Industries on Tuesday said the country's manufacturing confidence indicator rose to 1 in April from -2 in March.

The indicator is now slightly below its long-term average of 2.

Meanwhile, confidence in the construction sector strengthened considerably in April, with the indicator rising to -10 from -31.

The sentiment indicator for the services sector came in at 4, up from -3 in the previous month, while the retailers' confidence index rose to 7 from 3.

Wednesday, the Statistics Finland announced that the manufacturing turnover dropped 9.1% year-on-year in the November to January period, compared to the 15.3% fall in the October to December period.

During the period, the domestic sales decreased 13.3% and export turnover fell 10%.

The turnover contracted in all manufacturing industries in the November to January period. The turnover in metal industry dropped significantly by 16.7%, while in the electrical and electronic industry fell 15.8%. The contractions were smallest in the forest industry by 0.5% and in the food industry by 2.7%.

However, the turnover increased in mining and quarrying and in electricity, gas, steam, etc. supply, the statistical office said.

NORWAY

Oslo's OBX Bourse finished the week at 348.15, down 1.09% for the session Friday.

Norwegian seismic surveyor Petroleum Geo-Services ASA expects to benefit from increased spending by oil companies, but only after a tough first half, it said after posting below-forecast quarterly earnings.

Shares in PGS, which helps oil companies find oil and gas reserves by scanning the seabed, fell 5.0% to 85.4 crowns by 1016 GMT on Friday versus a 0.4% rise on Oslo's benchmark index .

The group said first-quarter core earnings dropped 52% due in part to low contract prices, but was upbeat on the second half as investment by oil companies picks up from lows seen during the global economic slowdown.

Analysts said expectations for PGS were inflated after WesternGeco, the seismic arm of US oil services group Schlumberger, was upbeat on pricing potential for its services, sending PGS stock nearly 6% higher a week ago.

Norway's jobless rate dropped to 3% in April from 3.1% in March, the Norwegian Labour and Welfare Service said Friday. The rate was in line with the economists' expectations. The jobless rate has stood above 3% since the start of this year.

Unemployment rose 9% from a year ago, representing an increase of 6,300 persons and reached 78,300 in April. As per the seasonally adjusted figures, there were an additional 600 unemployed persons in April.

Overall job vacancies declined 5% year-on-year in April.

Friday, the Statistics Norway announced that the M2 money supply increased 2.3% year-on-year in March, faster than the 2.2% growth in the previous month. This increase was mainly due to growth in other financial enterprises.

The total money supply amounted to NOK 1.522 billion in March, down from NOK 1.523 billion in the previous month.

Meanwhile, other financial enterprise money supply grew 5.9% annually in March, up from 2.3% fall in the preceding month. At the same time, non-financial enterprise money supply dropped 0.7%, after a0.5% increase in February.

Thursday, the Statistics Norway announced that the seasonally adjusted retail sales volume remained unchanged in March from the previous month. Economists expected an increase of 0.5%.

On an unadjusted basis, retail sales volume increased 11.5% annually in March. At the same time, retail sales, excluding petrol stations, grew 13.3%.

Meanwhile, retail sales value rose 13.2% year-on-year in March, and the sales, excluding petrol stations increased 14%.

SPAIN

The IBEX in Madrid traded its way into the weekend on 10,492.20, up 0.49%.

Spain has had its long-term sovereign debt rating downgraded to AA from AA+ by ratings agency Standard & Poor's, as fears continue to grow over contagion effects from the Greek debt crisis.

The agency said Spain faced a deeper deterioration in public finances and a longer period of economic weakness than it had previously expected. The news rattled European markets, which were already unsettled by Tuesday's downgrade of both Greece and Portugal.

"We now believe that the Spanish economy's shift from a credit-fueled economic growth is likely to result in a more protracted period of sluggish activity than we previously assumed," S&P credit analysts said in a statement.

Spain is still in recession and the government has launched a massive public works program to keep unemployment down. "Our conclusion is that challenging medium-term economic conditions will further pressure Spain's public finances, and additional measures are likely to be needed to underpin the government's fiscal consolidation strategy and planned program of structural reforms," S&P said.

Spanish private sector debt stands at 178% of gross domestic product, according to S&P, which is much higher than that of many of the country's peers. The agency said it also considered soaring unemployment, low export capacity, and a deterioration in the financial system's asset quality as factors slowing the country's economic recovery in the medium-term.

S&P affirmed Spain's credit outlook as negative, which implies that future downgrades could be in the pipeline. The country's short-term sovereign credit rating was also affirmed at A-1+.

The Spanish government appealed for calm following the ratings revaluation on Wednesday. "We have a very serious plan of fiscal consolidation and of deficit reduction. We have adopted an austerity program, we have put in place a Labour market reform," media reports quoted deputy prime minister Maria Teresa de la Vega as saying.

"We are adopting all the measures needed to meet our commitments. So I want to send a message of confidence to the population and of calm to the markets."

Stock markets around the world took a tumble after S&P downgraded Portugal's debt by two notches, while Greece's debt rating was slashed to "junk", meaning that it is seen as a risky place to invest. The yield on 10-year Greek government bonds, which is the interest the government has to pay investors to borrow money on the open market, hit 11.3% on Wednesday - a record high for a Eurozone country.

The average state pension for retirees in Spain rose to Eur 880.15 a month at the start of April, data released by the Ministry of Employment and Immigration showed on Tuesday.

This represents a 3.5% increase from a year ago.

The ministry said that overall state pension - including those for disabled persons, orphans, widows and widowers - stood at Eur 776.44 per month, representing an annual increase of 3.3%.

Some 8.64 million pensions were being paid out in Spain at the start of April, up 1.6% annually, with retirement pensions amounting to 5.12 million of the total.

The Spanish government is trying to push through plans to raise the retirement age to 67 amid gaping fiscal imbalances.

Spanish harmonized index of consumer prices or HICP rose 1.6% on an annual basis in April, faster than the 1.5% growth in the previous month, a flash report from the National Institute of Statistics showed on Thursday. A year ago, the HICP was down 0.2%.

The increase in HICP was mainly due to rise in price of fuels and lubricants and the decrease of package holidays prices, the statistical office said.

PORTUGAL

Lisbon saw a choppy week and the PSI General ended at 2,579.58, up 0.98%.

Thursday, the Statistics Portugal announced that the economic sentiment indicator stood at minus 0.2 in April, up from minus 0.5 in the previous month. A year ago, the consumer confidence was minus 3.2.

The confidence indicator on manufacturing industry increased to minus 14.1 in April from minus 15 in the previous month. The confidence indicator was minus 34.1 a year earlier.

The service confidence indicator remained unchanged at minus 5.8 in April, while the confidence indicator on trade increased to minus 6.9 from minus 7.7. But, the confidence indicator on construction and public works stood stable at minus 47.8.

Meanwhile, the consumer confidence indicator stood at minus 36.7 in April, down from minus 35.4 in the previous month.

ITALY

Italy's benchmark FTSE MIB Index rose for a second day, increasing 58.96, or 0.3%, to 21,754.66 as of 12:49 p.m. in Milan. The gauge has lost 4.3% this week.

Acea gained 31 cents, or 4.2%, to 7.7 Euros, snapping a four-day loss. GDF Suez SA said in a statement Thursday that it raised its stake in the Rome utility to more than 10%. "This is good news because it seems GDF Suez does not want to leave Acea's board," Equita Sim SpA said in a note.

Compagnie Industriali Riunite retreated 2 cents, or 1.2%, to 1.59 Euros, paring Thursday's gain, after saying first-quarter net income fell to 3.3 million Euros from ($4.4 million) 19.5 million Euros a year earlier.

Fondiaria-Sai advanced 20 cents, or 1.9%, to 10.64 Euros, rising for a third day this week. Gruppo Banca Leonardo said in a note that with the reorganization announced Thursday the insurer made "the first move in the asset disposal process."

Indesit Company rose 37 cents, or 3.8%, to 1.17 Euros, extending gains of 4.5% Thursday. Cheuvreux upgraded Italy's biggest home-appliance maker to "outperform" from "underperform" and added the stock to its "small and mid-cap list."

Exane BNP Paribas increased its price estimate on Italy's biggest home-appliance maker to 11 Euros from 10 Euros. The brokerage kept a "neutral" rating.

Luxottica Group fell 31 cents, or 1.5%, to 20.74 Euros, a fifth straight loss. Intermonte Sim SpA downgraded the world's largest maker of eyeglasses to "neutral" from "outperform" while increasing its price estimate to 21 Euros from 20.5 Euros. "The recent share price performance has already incorporated the benefits from first- quarter results," Intermonte said.

Mediolanum, the financial-services company partly owned by Italian Prime Minister Silvio Berlusconi, increased 9.5 cents, or 2.5%, to 3.92 Euros, the biggest gain in almost a month. "Optimism that a bailout for Greece is imminent is helping both financial shares in Europe and Mediolanum," said Davide Manenti, a fund manager at Nuovi Investimenti in Milan.

Pirelli, Europe's third-largest tyremaker, gained 1.3% to 43.4 cents. Michelin & Cie., the world's second-largest tiremaker, said first-quarter revenue rose 12%, led by a rebound in sales to truckmakers in Latin America and Asia and to logistics companies.

Prysmian, the world's second-biggest cable maker, slid 17 cents, or 1.2%, to 13.7 Euros. European basic-resource shares lost as much as 2.1%, the worst performance of 19 industry groups in the Stoxx Europe 600 Index Friday.

Separately, Citigroup Inc. kept a "buy" rating, saying in a note that "while poor first-quarter results could spark some short-term pressure on the share price, we remain positive on the longer term where we expect a return of long-delayed, and much needed, infrastructure capex across the globe."

Saipem rose 75 cents, or 2.7%, to 28.81 Euros, making it the biggest gainer in the index. Europe's largest oilfield-services provider signed about $3.5 billion in contracts for gas processing and sulfur recovery at a field in Abu Dhabi, a person familiar with the situation said. A spokeswoman for Saipem in Rome declined to comment on the matter.

STMicroelectronics rose for a second day, gaining 7.5 cents, or 1.1%, to 7.14 Euros. Barclays Capital increased its price projection on Europe's largest chipmaker to 7.75 Euros from 6 Euros and kept an "equal weight" rating.

Italian business confidence strengthened more than expected in April to hit the highest level since June 2008, a survey conducted by the think tank ISAE showed Wednesday.

Rising for the seventh straight month, the business sentiment index came in at 85.5 in April, up from a revised reading of 84.4 in March. The index stood above the expected level of 85. The reading for March was revised from the initial 84.1.

The latest survey results signaled that momentum in the economy is holding up, but economists at UniCredit said this is likely to translate only into moderate economic growth in the coming quarters. As such, average GDP growth for this year is seen at 0.5% and a 0.3% sequential growth for the first quarter, the firm said.

Data confirmed that the Italian economy is recovering, Clemente De Lucia, an economist at BNP Paribas said. The economist expects the economy to grow 0.6% this year after shrinking sharply by 5.1% in 2009. Net exports are set to sustain activity throughout the year, while domestic demand may remain subdued, constrained by weakening Labour market conditions and moderating household's purchasing power, the economist noted.

Better-than-expected increase in the business sentiment was mainly led by the marked improvement in orders, especially foreign orders, the research institute ISAE said. At the same time, production outlook dropped in April. Confidence improved particularly among manufacturers of consumer goods and capital goods. The survey was conducted between March 31 and April 20 among 4,000 companies.

The latest Purchasing Managers Index survey conducted for the 16-nation currency bloc strengthened sharply in April. The Flash PMI for the manufacturing sector stood at 46-month high of 57.5, while the services PMI climbed to a 30-month high of 55.5.

Thursday, the ISAE reported an improvement in the Italian consumer confidence. The sentiment index had climbed to 107.9 in April from 106.3 in the previous month. Consumers were more optimistic regarding economic recovery and fears of unemployment eased.

Italian consumer sentiment climbed to 107.9 in April from 106.3 in the previous month, think tank ISAE said in a report on Tuesday. Economists had expected the index to stay at 106.3 in April.

Among the sub indices, assessment of general economic situation rose to 81.4 from 79.2 and current economic situation assessment stood at 117.9, up from 115.9 in the previous month. The survey was conducted between April 1 and 16.

GREECE

In Athens, the Athex Composite survived a scrappy week and closed at 1,869.99, a gain of 2.22% on the Friday session.

National Bank of Greece rose 2.9% to 12.35 Euros, having jumped more than 20% in the past three days. Barroso's comments eased investor concern that the nation may default as Prime Minister George Papandreou started his sales pitch to the Greek people as unions denounced "unjust" budget cuts linked to a potential $159 billion European Union-led bailout.

Greek producer price index or PPI rose 8.7% on an annual basis in March, compared to the 7.3% fall recorded a year ago, the statistical office said on Thursday.

The PPI for the domestic market grew 7.9% annually in March, while the PPI for non-domestic market rose 11.6%.

On a monthly basis, the PPI increased 1.4% in March, in contrast to the 0.4% decline a year earlier.

For the April 2009 to March 2010 period, the annual average rate of change of the PPI decreased 2.9% compared to the same period of the previous year.