Global stocks markets hit after Chinese data and Fed comments

          Global markets have fallen after weak Chinese data and fears the US Federal Reserve may slow its monetary stimulus. In Asia, the fall was led by Japan's Nikkei index, which closed down 7.3% having fallen as much as 10%. European markets slipped, with London, Frankfurt and Paris all closing down by about 2%. In the US, the Dow Jones was slightly down in mid-day trade. The falls came after a long period of rising share prices, with several indexes reaching record highs. Earlier on Wednesday, data was released suggesting a slowdown in Chinese manufacturing. On Tuesday Fed chairman Ben Bernanke hinted that Quantitative Easing efforts in the US may be scaled back. Also, activity in the Eurozone’s manufacturing and services sector continued to contract in May, closely-watched preliminary data from Mark it, a financial information services company, showed. Separate data also from Mark it, and released before US stocks opened, showed US manufacturing activity fell for the second straight month in May. But a fall in the number of Americans claiming weekly unemployment benefits, pointing to a tentative recovery in the labor market, gave a mixed picture of the economy. But traders also suggested a correction was expected, following a period of rising markets. "Given how overbought the markets were it's not surprising to see a correction," said Jawaid Asfar, a sales trader at Secure Equity.

In Asia, Hong Kong's Hang Seng dropped 2.5%, and South Korea's Kospi lost 1.2%. Markets in Australia and Singapore also fell. The Nikkei's 7.3% fall was the steepest one-day decline since 2011 in the wake of the tsunami and nuclear crises. The China data showed that factory activity contracted for the first time in seventh months in May. The preliminary HSBC Purchasing Managers' Index (PMI) for May fell to 49.6. A figure below 50 indicates a contraction. Analysts said the figures suggest that the Chinese government's target of achieving 7.5% growth this year may be missed.

'Overheated'

"It's no secret. The true picture is that China's export sector is slowing down, and its manufacturing sector is also slowing down. That means the trade surplus is almost gone," said Francis Lun, chief economist at GE Oriental Financial Group.  In April, the PMI had fallen to 50.6 from 50.9 in March, underlining that the economy's pace of expansion was slowing down.

Investor sentiment had already soured on Wednesday after Mr. Bernanke told a congressional committee that the central bank could scale back the pace of bond purchases over the next few meetings if the job market shows "real and sustainable progress". "Fed chairman Ben Bernanke's much anticipated testimony... certainly initiated the volatility" on stock markets, said Spreadex trader Max Cohen. The central bank's $85bn (£56bn)-bond purchases, known as Quantitative Easing, were designed to pump liquidity into the financial system to bring down borrowing rates for households and businesses, therefore shoring up the economy.

The minutes of the Fed's last meeting - revealed shortly before Mr. Bernanke's testimony - said that "a number" of officials favored slowing down the Fed's efforts as early as June. The Fed next meets on 18-19 June. Neil MacKinnon, economist at VTB Capital, said that while the financial markets were focused on Mr. Bernanke's comments, in his view "it says more about an equity market that is 'overheated' and due a correction rather than any suggestion from the Fed that monetary stimulus is about to be withdrawn".

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US Federal Reserve to maintain stimulus efforts

Federal Reserve Chairman Ben Bernanke

          Chairman Ben Bernanke told the Congress that the U.S. job market remains weak and that it is too soon for the Federal Reserve to end its extraordinary stimulus programs.

In testimony to the Joint Economic Committee, Bernanke notes the U.S. economy is growing moderately this year and unemployment has fallen to a four-year low of 7.5 percent. Still, unemployment remains well above levels consistent with healthy economies. And Bernanke says higher taxes and deep federal spending cuts are expected to slow economic growth this year.

Bernanke says reducing the Fed's efforts to keep borrowing rates low would "carry a substantial risk of slowing or ending the economic recovery."

The Fed's low interest-rate polices have made borrowing cheaper and helped ignite a huge stock rally this year.

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Cannes film festival suffers $1m jewellery theft

The jewels were initially thought to have been loaned to stars at the annual film festival on the French Riviera.

They were taken from the hotel room of an employee of exclusive Swiss jewelers Chopard in the early hours of Friday morning.

Police say the thieves ripped the safe containing the jewels from a wall of the room at the Novotel hotel.

But a company spokeswoman, Raffaella Rossiello, insisted the value of the pieces had been exaggerated and "the jeweler stolen is not part of the collection... worn by actresses during the Cannes Film Festival".

And festival officials said the event's top award, the Palme d'Or, was not among the stolen items.

The trophy is also made by Chopard, an official sponsor of the festival.

Celebrities choosing the Swiss firm's gems for their red carpet appearances at this year's festival include Julianne Moore, Lana Del Rey and Cindy Crawford.

The theft happened a few hours after the festival was shown The Bling Ring, a new film by director Sofia Coppola.

The film is about teenagers who find out when celebrities are attending red carpet events in order to break into their homes and steal their designer clothes, bags and shoes.

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The iPhone maker is again No.1

Apple has again been crowned the most valuable global brand in the annual BrandZ report.

Released Tuesday, Mill ward Brown Optimor's 2013 BrandZ report pegs Apple with a brand value of $185 billion, up from $183 billion last year. Based on financial data and the opinions of potential and current buyers, Apple retained its top rank in spite of the thrashing suffered by its stock over the past several months.

"Despite a more competitive marketplace and other challengers nipping at its heels, Apple's ability to maintain its No.1 position demonstrates the value that having a strong brand brings to business," Nick Cooper, managing director of Mill ward Brown Optimor, said in a statement. "People still love the brand regardless of its stock price."

But Apple's value rose just 1 percent from last year, compared with a 19 percent jump in 2012 and an 84 percent leap in 2011. As such, a few other tech players outscored Apple in their value growth this year.

No. 2 Google received a brand value of $113 billion, a 5 percent gain from last year. No. 6 AT&T saw its value rise 10 percent to $75 billion. And No. 10 China Mobile earned a value of $55 billion, a gain of 18 percent from 2012.

Apple's major rival, Samsung, was No. 30 on the list. But it jumped by 51 percent from last year, achieving a brand value of $21 billion.

"Vying for leadership in the smartphone market, Samsung fueled its huge increase in brand value by balancing a remarkable period of innovation with growing market share -- it spent $1.6 billion more on advertising in the last year," Cooper said.

Still, other tech players saw their values drop in the BrandZ report. No. 3 IBM lost 3 percent of its value, No. 7 Microsoft shed 9 percent, and No. 31 Facebook gave up 36 percent.

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TCS beats ONGC

Tata Group software services company Tata Consultancy Services today became the country's most valued firm with a market capitalization of over Rs 2.87 lakh crore, surpassing energy major ONGC's value of more than Rs 2.84 lakh crore.

At the end of trade today, TCS commanded a market cap of Rs 2, 87,320 crore. This is about Rs 2,508 crore more than the ONGC's m-cap of Rs 2, 84,812 crore.

Shares of TCS ended without change, while ONGC fell by 2.09 per cent on the BSE. Last week, state owned energy major ONGC had pushed IT giant TCS to the second slot in the list of top-10 most-valued companies. Reliance Industries with a market capitalization of Rs 2, 68,910 crore was at third place, followed by ITC (Rs 2, 64,434 crore) and Coal India (Rs 1, 89,964 crore).

Market capitalization or the value of a listed company is arrived at by multiplying the total number of its shares with its stock price on a particular day or time. This figure changes daily with the change in the stock price.

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