Global News August 6, 2015

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  2. Global News August 6, 2015

Global News August 6, 2015

Jobless Claims in U.S. Hover Near Lowest in Four Decades: Filings for U.S. unemployment benefits are hovering near the lowest levels in four decades, a sign the strong labor market will bolster U.S. growth. Jobless claims rose by 3,000 to 270,000 in the week ended August 1, a report from the Labor Department showed on Thursday in Washington. The median forecast of 41 economists surveyed by Bloomberg called for 272,000. The 255,000 reading two weeks earlier was the lowest since November 1973. Firings are at historically low levels as employers hold on to more workers in response to increased demand following a slump in early 2015. More hiring would help convince Federal Reserve policy makers that the economy can withstand an increase in the benchmark interest rate this year.

-Gold Crash Costs Russia and China $5.4 Billion in Just Three Weeks: Gold’s meltdown has cost Russia and China about $5.4 billion. That’s the value of the two countries’ gold reserves that has been wiped out in less than three weeks as prices slump to five-year lows, dragged down by expectations for higher U.S. interest rates and a stronger dollar. Bullion’s tumble is especially painful for Russia and China, the biggest buyers of gold over the past six years. China has expanded its holdings by almost 60 percent since 2009, while Russia more than doubled its assets and added reserves last month as prices fell another 6.5 percent.

European Stocks Fall With Oil Shares After Best Rally in 3 Weeks: A drop in energy producers dragged European stocks lower, while investors weighed the prospect of a Federal Reserve rate increase. BP Plc and Tullow Oil Plc fell at least 1.2 percent as oil traded near its lowest price since March. Some shares also moved on earnings. Zurich Insurance Group AG slid 4.2 percent after posting worse-than-estimated profit. The Stoxx Europe 600 Index lost 0.4 percent to 402.5 at 12:38 p.m. in London. The benchmark measure rose for the sixth time in seven days on Wednesday as miners rallied the most since April. It has surged 18 percent this year.

Europe Moves to Cut Risk in $505 Trillion Derivatives Market: Banks and investors in the European Union will have to send trades of some interest-rate swaps to a third party under new rules intended to make financial markets safer. The banks and major investors that hold the derivatives will have to use a third party called a clearinghouse to process their trades, the European Commission, the EU’s executive arm, said in a statement on Thursday. The Group of 20 nations in 2009 mandated clearing for many swaps contracts in an attempt to reduce the damage that would be caused by a major financial institution defaulting on its payments.

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Russia and France cancel $1.3 billion warship deal: The two countries have terminated a contract worth 1.2 billion euros ($1.3 billion) for France to supply two Mistral-class amphibious assault ships to Russia. The deal was signed in 2011 but France faced pressure to withdraw from the arrangement after Russia annexed Crimea from Ukraine. The French government suspended delivery of the ships last year. Russian President Vladimir Putin and French President Francois Hollande said in a joint statement that the parties had reached a «mutually acceptable agreement.»

Exxon and Chevron profits are down over 50%: Big Oil earnings have nosedived in the past year. The latest results that came out Friday were even worse than expected. Chevron (CVX) announced a 90% drop in earnings on Friday. It went from bringing in $5.7 billion in the second quarter of 2014 to hauling in a mere $571 million this year. Exxon Mobil (XOM) isn’t much better. It raked in $8.8 billion in profits for the second quarter of 2014. This year, it earned less than half that amount — $4.2 billion. The problem for these companies is well known by now: Oil and gas prices have plummeted from over $100 a barrel last summer to under $50 now. It’s a lot harder to make money when you can only sell your product for half of what it used to be worth.