May 30 2013

Europe ‘rethinking transaction tax’. Firms more optimistic, EC survey finds. Shares slide in Japan. Spanish economy shrank 2% over last year. US economic growth for the first three months has been revised down slightly, to 2.4% on an annualised basis…

Powered by article titled “Japan’s Nikkei tumbles 5%; French jobless total hits new high – as it happened” was written by Graeme Wearden, for on Thursday 30th May 2013 15.28 UTC

7.11pm BST

Closing summary

Time to knock things on the head for another day.

Here's a closing summary:

Japan's Nikkei took another tumble, falling by over 5% as the Tokyo exchange was gripped by another bout of selling. Ministers insisted there was no need for panic, but the drop highlighted concerns that the country's new economic stimulus package may not be working. Highlights from 7.43am onwards.

The French jobless total has hit a new record high, piling more pressure on the Paris government. There are now 3.26m people officially out of work in France, after the total jumped by almost 40,000 in April (see 5.06pm and 6.16pm for details).

Angela Merkel urged France to implement the reforms requested by the European Commission in return for the deficit deadline extension granted yesterday. The comments came at a press conference with Francois Hollande (highlights from 5.37pm).

There was a welcome increase in eurozone economic sentiment. Figures released by the European Commission suggested firms are more optimistic about the crisis, which may increase chances of the recession ending soon (details from 10.09am).

Anger against Europe's financial crisis was on display. There was a general strike in the Basque region of Spain (see here), and a 24-hour walkout on the Lisbon subway (see here).

Europe appears to back away from implementing a financial transaction tax. According to Reuters, officials are working on a watered-down proposals which could costs banks much less (see 1.38pm). Campaigners haven't given up the fight (see 3.38pm).

New economic data from the US showed a rise in the number of people signing on for jobless benefit. Economic growth for the first three months of 2013 was revised down, a little bit. Less chance of the Federal Reserve ending quantitative easing soon? (see 2.05pm).

And John Bon Jovi has revealed he has waived his fee for playing in Spain. Details here.

I'll be back tomorrow. Thanks, as ever, for reading and commenting. Goodnight. GW

Updated at 7.18pm BST

6.38pm BST

Markets calm after Japanese storm

The financial markets remain unspooked by the overnight tumble on the Nikkei.

The main European markets closed higher (only Spain finished narrowly in the red), and on Wall Street the Dow Jones and S&P 500 are both up around 0.5%.

Stock markets closing prices, May 30 2013
Stock markets closing/latest prices. Photograph: /Thomson Reuters

6.28pm BST

The Open Europe thinktank was also watching the press conference, and flags up:

Updated at 6.28pm BST

6.19pm BST

Merkel tells France to reform

Angela Merkel also reminded Francois Hollande that, for all his talk of national sovereignty, he needs to get the French deficit below 3% of GDP.

She told reporters:

We agreed to give France two more years to cut its deficit to 3.0 percent … and coupled with that is the expectation that reforms will be implemented. These go hand in hand.

And that's the end of the press conference (highlights from 5.37pm)

6.16pm BST

A reminder of the jobless crisis in France — there are now more than 3.26 million people officially out of work, after the total rose by almost 40,000, or 1.2%, in April.

There are now 12.5% more jobseekers than in April 2012.

This is a record, according to data which goes back to 1996. The previous record was set in 1997 and broken in March 2013.

6.10pm BST

Here's Hollande's pledge to reverse France's growing jobless total:

Despite this data, despite what it means for many French people individually or for their family, I maintain the goal of reversing the unemployment trend by year-end.

6.03pm BST

Hollande: We will reverse rising unemployment

Francois Hollande says he is committed to "reversing" France's unemployment trend by the end of this year, just an hour after new data showed the jobless total has hit a new high (see 5.06pm).

Asked about the issue, Angela Merkel says that Germany's relatively good jobless rate is due to the "flexibility" of its labour markets (including no minimum wage, as our Europe editor Ian Traynor flagged up here).

5.59pm BST

Francois Hollande has reiterated that France cannot be ordered around by Brussels, a point he made last night after the European Commission released its latest country recommendations.

Asked how this squares with his support for closer economic governance in the eurozone, Hollande explained that the EC gives recommendations, but does not tell states what they must do.

The methods….are the responsibility of France, Hollande told this evening's press conference.


The details and procedures…are the responsibility of the government and the state, otherwise there would be no possibility of sovereignty. The Sovereignty must be in the implementation.

(quote via Reuters' Paris bureau, which I've translated)

5.56pm BST

Also.. what would a new, full-time president of the eurogroup mean for Jeroen Dijsselbloem, the Dutch finance minister who took the job at the start of 2013?

Dijsselbloem got off to a shaky start with the bungled Cyprus bailout (for which he took responsibility, although few officials/leaders involved came out of it well). He then caused alarm by indicating that the Cypriot banking levy on wealthy depositors could be a model for the future (and indeed the eurozone is moving towards a bailing-in model for large creditors).

Is he now being shunted aside?

5.44pm BST

France and Germany both back the idea of having a full-time president of the Eurogroup of euro zone finance ministers, President Francois Hollande told the press conference:

On the organisation of economic governance, we are both in agreement that there should be more euro zone summits with a full-time Eurogroup president with reinforced powers who could also be given the mandate, by euro zone ministers, to push for action on employment in industry and research.

More summits, eh? What larks

Updated at 5.47pm BST

5.37pm BST

Merkel-Hollande press conference underway

Angela Merkel and Francois Hollande
Angela Merkel and Francois Hollande Photograph: /N24

German chancellor Angela Merkel and French president Francois Hollande are holding their press conference now (livestream here).

The two leaders appear to be putting on a show of unity, following recent tensions between Europe's two largest countries.

Hollande has told reporters that France and Germany both want funding to be dispensed quickly by Brussels to finance new employment initiatives.

Merkel has said she wants the Growth and Employment pact agreed last summer to be implemented quickly, alongside closer 'economic co-ordination' to improve competitiveness and tackle imbalances in the eurozone.

More to follow

5.06pm BST

French unemployment hits new record high

It's official, the French unemployment crisis has worsened with another 39,800 people registered as jobless in April.

That takes the total out of work to work to 3,264, the highest level since records began in 1996.

Reuters flags up that this is the 53rd month out of 61 in which the jobless total has risen.

4.59pm BST

Photos: Basque general strike

Thousands of people have taken part in a general strike in the Basque area of Spain today, in protest at austerity measures being implemented by national and regional governments.

It was called by the two main Basque unions. There are reports of isolated clashes between protesters and riot police. The ANSA news agency says that eight people were arrested in Pamplona.

These photos show it was well-attended:

Thousands of people take part in a protest during a 24-hour general strike called by the major Basque unions in protest against the spending cuts approved by the Spanish and Basque governments, in San Sebastian, the Basque Country, Spain, 30 May 2013.
Thousands of people take part in a protest in San Sebastian, the Basque Country, Spain, 30 May 2013. Photograph: Javier Etxezarreta/EPA
A demonstrator holds a flag reading in Basque language, 'General Strike, May 30',  during the general strike in  Pamplona, northern Spain on Thursday, May 30, 2013.
A demonstrator holds a flag reading in Basque language, ‘General Strike, May 30′, during the general strike in Pamplona. Photograph: Alvaro Barrientos/AP
-- A man walks next to the Banco Sabadell, with graffiti: Today all the streets to fight and thieves.
A man walks next to the Banco Sabadell, with graffiti that reads: “Today all the streets to fight and thieves”. Photograph: Javi Julio/Demotix/Corbis
Members of union picket lines protest with Basque policemen at the entrance of a shopping mall during a regional strike called by the main Basque unions in the northern Spanish Basque city of Bilbao, on May 30, 2013.
Members of union picket lines protest in front of Basque policemen at the entrance of a shopping mall in the northern Spanish Basque city of Bilbao today. Photograph: RAFA RIVAS/AFP/Getty Images

4.50pm BST

Heads-up: Angela Merkel and Francois Hollande are holding a joint press-conference shortly. It'll be streamed here.

Updated at 4.53pm BST

4.28pm BST

The view from Athens

Over in Greece our correspondent Helena Smith reports that the jobs figures keep getting worse:

In what must be one of the most dispiriting set of figures released since the start of the euro crisis, a poll commissioned by Athens University shows that Greeks are not only not buying into the official optimism the coalition government has made a point of drumming home but are fast falling into deep despair.

Three out of ten Greeks (29.9%) are actually in paid, permanent work at present*, according to Opinion Poll which conducted the survey with one out of two Greeks saying their desire is to work abroad.

* – rather than, say, studying or in temporary work, or between jobs….

With the official unemployment rate now at a euro zone record of 27%, those who do have jobs are not hopeful either with six out of ten telling pollsters they fear they won’t have work for long. A whopping 85.39% said they were vehemently opposed to the policies being pursued by Europe with 70.76% saying they did not think the European Union would resolve the crisis in the next two years. In another sign of bleakness, the vast majority blamed the unprecedented levels of joblessness, especially among the young who have been hardest hit, on immigrants. 

The poll was released as Greece’s finance minister, Yannis Stournaras, rejected an OECD forecast that Greece was headed for a seventh year of recession.

The Paris-based organization predicted yesteday that the Greek economy would contract by 4.8 percent this year and 1.2 percent in 2014. “We disagree with that figure,” said Stournaras. The European Commission and the International Monetary Fund also disagree with it. I believe this will be proven wrong and we will be right, as I believe that the GDP will be just under plus 1 percent,” he told reporters in Paris. 

In line with sentiment on the ground, the OECD forecast that unemployment would also rise next year to 28.4%. Ever the eternal optimist, Stounaras added that Athens would proceed with its first, if small, bond issue next year.

Updated at 7.16pm BST

3.59pm BST

There's a rumour swirling that the French unemployment data has leaked, and that the figures are another dose of bad news for president Hollande.

Les Echos, the French news paper, is reporting that the number of registered jobseekers rose by about 40,000 in April, on top of March's record high. Here's their story.

We'll find out at 5pm….

3.38pm BST

Robin Hood campaign: we need the FTT

Campaigners for a Financial Transaction Tax have responded to today's reports that Europe is rowing back on its plans to impose the levy.

David Hillman, spokesperson for the Robin Hood Tax campaign, said he was hopeful that the FTT would not be scaled back:

It is true that countries are debating the details of the tax but our understanding is there remains a firm intention to agree a strong FTT that will be popular with the public and raise tens of billions from the banking industry.

That is why the banks are lobbying so hard – precisely because they know they will soon be paying it. And if the FTT works well in Europe, it will be harder for them to argue against paying their fair share here.

This tax must be implemented in full – it's time the special privilege of the financial sector, which has cost the rest of society so dear, is brought to an end.

As reported at 1.38pm, officials have told Reuters that the FTT could be watered down to just 0.01% of a trade's value, from a previous plan of 0.1%. The rethink, following lobbying and legal action, could also see the tax only imposed on shares at first.

3.27pm BST

Falling Irish unemployment welcomed

The news that Ireland's unemployment rate has fallen to 13.7% (see 11.11am) is being hailed as a chink of light for the country's economy, reports Henry McDonald in Dublin:

He writes:

One of the two ruling parties in the Dublin coalition, Fine Gael, has claimed the drop in unemployment showed that the government's strategy of generating jobs is bearing fruit.

Fine Gael TD Damien English welcomed the CSO figures which report the first drop in Irish unemployment in three years.

He said: “Taking a closer look at today’s figures from the CSO reveals some encouraging trends. Not only has unemployment dipped below 14% for the first time in three years, we are also making progress in tackling the long-term unemployment rate, which has remained stubbornly high.

“About two-thirds of those who are out of work are long-term unemployed, and helping these people re-enter the workforce is crucial if we want to get on top of this crippling problem. The long-term unemployment rate has fallen by almost 1% over the last year. Of course, it remains far too high, but it is encouraging that we are moving in the right direction.

2.59pm BST

Heads-up: Dutch finance minister Jeroen Dijsselbloem, who also chairs the eurogroup, is visiting Greece tomorrow.

Dijsselbloem will hold talks with his Greek counterpart, Yannis Stournaras, from 3pm local time (1pm BST), followed by a press conference.

Suspect we'll hear more about how Greece is fighting its way through the crisis (today's rise in economic sentiment could be cited).

If so, we shouldn't forget that unemployment is at record high, and the economy's shrunk by around 20% since the ongoing recession started.

2.46pm BST

Wall Street opens

After the drama of Tokyo, we have torpor on Wall Street where the Dow Jones has risen by a paltry 0.1% in early trading, matching the FTSE 100.

Things are a little brighter in Europe, with the German DAX and French CAC both up around 0.5%. Pretty calm, though, after the Nikkei's decline.

Updated at 2.46pm BST

2.29pm BST

The small downward revision to US GDP is nothing to worry about, argues Paul Ashworth, chief US economist at Capital Economics.

He points out that drop was partly due to larger drop in government spending (knocking 1% off GDP, not 0.8%)

The fiscal squeeze will continue for the rest of this year, but should begin to ease off after that.

He adds that the private sector appears to be doing well:

Consumption growth is now estimated to have accelerated to 3.4% annualised in the first quarter, up from the initial estimate of a 3.2% gain. This is even more impressive given the expiry of the payroll tax cut at the end of last year. Real personal disposable incomes are now estimated to have fallen by a massive 8.4% in the first quarter, reversing an 8.9% jump in the final quarter of last year, which reflected a surge in bonuses and dividends paid earlier to avoid those higher taxes.

As a result, the saving rate slumped to only 2.3%. Otherwise, the positive contribution to first quarter GDP growth from inventories was lowered, while the drag from net external trade was also assumed to be smaller. These two changes largely offset each other.

This graph from Zerohedge shows the details (first estimate on the left, and today's final reading on the right)

US GDP Q1 2013, revised
US GDP code
Photograph: Zerohedge

2.05pm BST

US data disappoints

Two pieces of weaker-than-expected US data have been released, suggesting America's economy may not be as vibrant as thought.

1) The weekly jobless claims data showed that 354,000 people signed on for unemployment benefit for the first time last week, up from 344,00 the previous seven days.

The number of people filing 'continued claims' also rose, to 2.986m, having dropped below the three million mark last week for the time since March 2008.

2) US economic growth for the first three months has been revised down slightly, to 2.4% on an annualised basis (ie, 0.6% quarter-on-quarter), from 2.5%.

The figures are surprising, given how much American data has beaten forecasts in recent days (consumer confidence, house prices and manufacturing output have all been more decent than expected)

That may mean the Federal Reserve doesn't begin slowing, or 'tapering', its electronic money-printing operation soon, suggests Mike van Dulken of Accendo Markets:

Updated at 2.08pm BST

1.38pm BST

Europe to ‘scale back Financial Transaction Tax’

The City of London.
The City of London. Photograph: Grant Smith/Alamy

Reuters is reporting that European officials are planning to scale back their proposed financial transactions tax drastically, following lobbying from the banking sector and a legal challenge from the UK.

Under the new proposal, the FTT would be rolled out more slowly, and would only raise one-tenth as much as previously expected.

The changes on the table, which aren't yet agreed, would cut the levy on transactions to just 0.01% of the value of a deal, from 0.1%.

Officials are also planning to simply impose the charge on shares, initially, and only extend it to other products such as derivatives once they've established the impact of the FTT.

One official explained:

The whole thing will have to be changed quite a lot…

It is not going to survive in its current form.


You can introduce it on a staggered basis.

We start with the lowest rate of tax and increase it bit by bit.

The full story is here: Exclusive – Europe plans major scaling back of financial trading tax

Brussels had hoped that the FTT would raise significant funds to fix some of the damage cause by the financial crisis.

It was based on work by economist James Tobin in the 1970s. He famously spoke of throwing sand into the wheels of the financial system, making short-term trading less lucrative while having little impact on buy-and-hold investing.

It was picked up by the Robin Hood movement, who hoped to use it to raise funds for development work, before Brussels saw how they, too, could implement it. In January, 11 countries agreed to bring it in.

But it was very unpopular with the City. Even though the UK isn't implementing the FTT, it would hit firms when they traded with European banks.

The British government launched a legal challenge to the plan in April. And last week the Bank of England governor, Sir Mervyn King, attacked the FTT and claimed that he couldn't find anyone in the world of European central banks who supported the idea.

Of course, nothing is official yet, as Reuters explains:

Any final decision is up to the countries that have signed up and remains months away. 

Germany, for example, is unlikely to back any scaling down of the levy in public before elections in September, because Chancellor Angela Merkel's coalition has committed itself to the voter-friendly tax.

1.05pm BST

Meanwhile, back in Japan…

A report that Japan's public pension fund may pile more funds into the stock market has sparked a wild swing in the futures market.

Hours after today's 5% slide (see opening post onwards), Reuters reported that the Government Pension Investment Fund (GPIF), which manages some trn, is considering changing its potential risk and return rules on assets to give it more flexibility.

Otherwise, the report claims, GPIF might have to buy more Japanese bonds and sell shares.

It's attributed to an unnamed source, who reckons the move could be anounced within a month, and it's enough to send traders pushing up the Nikkei futures price. That now suggests the index could jump by 400 points tomorrow morning, having lost 737 today.

Nikkei futures price, May 30th
Photograph: InFront (with thanks to @finansakrobat )

It's also pushing shares up in London, with the FTSE 100 up 25 points now at 6651.

Updated at 1.05pm BST

12.15pm BST

Subway workers strike in Lisbon

A woman reads a sign saying: “The subway is closed due to the strike”. Photograph: Francisco Seco/AP

Subway staff in Lisbon are holding a 24-hour walkout in protest at the country's austerity programme, causing traffic snarl-ups in the Portuguese capital.

The strike was organised by unions to show their opposition to welfare cutbacks, and labour market reforms, which are part of Portugal's €78bn bailout deal.

The Metropolitano de Lisboa, which normally carries half-million passengers a day, is at a stand-still, according to the Portugal News. The disruption began late on Wednesday and is expected to continue until Friday morning.

Union leader Anabela Carvalheira told the Lusa news agency that the numbers of strikers “is good”, adding:

So far there are no workers on the trains, in the stations or at the workshops.

Commuters queue for a bus during a 24-hour subway workers strike, Lisbon, Thursday, May 30, 2013.
Commuters queue for a bus during a 24-hour subway workers strike. Photograph: Francisco Seco/AP

AP has more details about the strike.

The protest comes ahead of a spate of strikes by government workers and employees of public companies in coming weeks, including a planned walkout by teachers during the period of high-school summer exams.
The country's two trade union confederations, representing more than 1 million mostly blue-collar workers, are also considering rare joint protests.

Commuters walk along Comercio square during a 24-hour subway workers strike, Lisbon, Thursday, May 30, 2013.
Commuters walk along Comercio square in Lisbon today. Photograph: Francisco Seco/AP

11.19am BST

Today's fall in Irish unemployment was due to a 24,200 rise in the number of people in part-time employment unemployment. The total in full-time work fell, though, by 3,700.

Updated at 4.41pm BST

11.11am BST

Irish unemployment data released

Ireland's unemployment rate has fallen this year, but remains painfully high, data just released shows.

The seasonally-adjusted jobless rate dropped to 13.7% in the first quarter of 2013, down from 14.1% in the last three months of 2012 (Reuters reports).

It's the first time the seasonally-adjusted rate has been below 14% in two years.

This comes a day after the OECD said Ireland must implement "decisive labour-market reforms" to help people, especially the young, into work.

Updated at 11.18am BST

11.07am BST

David Jones of IG Index cautions against over-hyping today's 5% fall on the Nikkei today.

Updated at 11.26am BST

10.57am BST

Howard Archer of IHS Global Insight is also cheered by today's rise in eurozone confidence, but agrees that the situation is still weak:

Following on from modestly improved purchasing managers surveys for May, a limited overall pick up in economic sentiment supports hopes that Eurozone economic activity is inching towards stabilization in the second quarter after contracting for a sixth successive quarter in the first quarter of 2013. However, sentiment is still pretty muted and fragile, and the situation varies markedly between countries. If the Eurozone does finally manage to stop contracting overall in the second quarter, it is likely to be heavily dependent on clear growth in Germany.

If the trend continues, he adds, then firms should pare back their job cutting and consumers could start spending a little more (aided by the fact that inflation in the eurozone has been falling.

10.47am BST

Eurozone confidence rises – early reaction

Eurozone consumer confidence, to May 30 2013
Economic sentiment in the eurozone and EU. Photograph: European Commission

Hopes that the eurozone could exit recession before Christmas have been bolstered by today's rise in eurozone economic confidence (see 10.03am), suggests Martin van Vliet, economist at ING.

However, the underlying pictures remains troubling – Europe is not out of its economic crisis yet.

Van Vliet explains:

With economic sentiment across the Eurozone starting to turn up again, hopes will be rising that the Eurozone could exit recession in the second half of this year.

But we shouldn’t get overexcited here. With more fiscal austerity in the pipeline – slower austerity still is austerity –, unemployment elevated and still rising and, in some cases, still weakening housing markets, consumers and businesses have plenty of reason to remain worried. So while it is encouraging to see that confidence is again moving in the right direction, there remains a long way before confidence is restored. Any nascent economic recovery later this year is therefore likely to be slow, and will probably be largely confided to the “core” countries.

And today's data also showed an increase in sentiment in Greece, after many dark months:

Updated at 11.00am BST

10.09am BST

Economic outlook may be getting brighter…

Confidence improved across the eurozone's five largest economies – Germany, France, Italy, Spain and the Netherlands – according to the European Commission's new survey (see 10.03am).

Service sector companies and manufacturers both reported that the economic climate has picked up.

• Services sentiment: -9.3, up from -11.1 in April

• Industrial climate: -13.0, up from -13.8 in April

The Commission said that industrial firms were reporting healthier order books, suggesting better economic times in the months ahead.

10.03am BST

Eurozone sentiment improves

Just in: eurozone citizens and businesses are more confident about economic prospects than a month ago.

The European Commission's monthly survey found that economic sentiment has risen to 89.4 this month, up from 88.6 in April.

And consumer confidence is up too, at -21.9 from -22.3. Still deeply into negative territory, though, but it's getting better.

Updated at 10.04am BST

9.59am BST

A special adviser to Japanese PM Abe has apparently said that today's 5% tumble on the Nikkei isn't a cause for alarm, because it's natural for shares to move randomly.

Reuters' Tokyo bureau has the details:

The recent volatility in the Japanese stock market is not surprising as it is natural for stock prices to move randomly, Koichi Hamada, a special economic adviser to Prime Minister Shinzo Abe said on Thursday.

Hamada, speaking to reporters, also said he is not worried about the rise in Japan's long-term yield as real interest rates remain low.

Am not sure that the 'random walk theory' is completely applicable in a situation where a country is attempting an unprecedented stimulus package, at a time of global unease over monetary policy….

9.40am BST

Germany’s eurosceptic leader: I could work with Merkel

Bernd Lucke, co-founder of Germany’s anti-euro party “Alternative fuer Deutschland”. Photograph: KAI PFAFFENBACH/REUTERS

The leader of Germany's new anti-euro party has told Reuters that he could work with Angela Merkel's party following this autumn's elections, as long as she agrees to take a harder line on aid to struggling euro zone members.

The comments may cause some concern in the eurozone periphery, although it's not clear that Alternative For Deutschland will attract enough votes to secure seats in the German parliament.

Bernd Lucke, founder of AfD, told Reuters that he could drop his demand that Germany withdraws from the eurozone, if Merkel agreed to be tougher:

Lucke, a macroeconomics professor, explained:

I could imagine cooperating with a centre-right government if this coalition was prepared to accept significantly tougher conditions on aid from the ESM [the eurozone bailout fund].

In other words, only paying out aid tranches when bailed out countries really fulfil their obligations. At the moment, when a country like Greece or Portugal fails to meet the criteria, they receive aid regardless, because we are told they made a decent effort.

The full interview is online here.

Lucke's comments come at a time when Europe appears to be moving away from hard-line tactics and towards a push for growth. On Monday, Spiegel reported that Merkel's government was ready to "gamble" on new stimulus measures to help Southern Europe (more here)

8.55am BST

Bon Jovi waives fee for Spanish gig

Jon Bon Jovi performs on stage at Munich Olympiastadion on May 18, 2013 in Munich, Germany.
Jon Bon Jovi performing on stage at Munich Olympiastadion earlier this month. Photograph: Stefan M. Prager/Redferns via Getty Images

US rock star Jon Bon Jovi has revealed he is playing a concert in Spain for free next month, meaning cheaper tickets for fans who have suffered from the country's economic trauma.

Bon Jovi told Spanish newspaper El Mundo that he wanted to give something back to Spain, after realising that many citizens wouldn't be able to afford the experience.

He explained:

When we started planning our tour for our album, 'What about now', we did a study and found that, due to the economic situation, Spain wouldn't be on the roadmap

However, we didn't want to ditch the fans of a country I love and has treated me so well for 30 years.

The gig takes place at the Vicente Calderon stadium on 29 June, and is already sold out. Tickets were priced at between €18 and €39, with proceeds going to cover venue costs and staff wages.

A ticket for Bon Jovi's gig in Manchester, next month. will cost you around £95 (€111), (based on a quick search this morning).

The 51-year old musician can take the financial hit, given his estimated net worth of 5m. Still, it's an encouraging response to Europe's woes — given some rock bands had considered touring elsewhere instead for fear of not being paid.

Updated at 9.00am BST

8.34am BST

No panic in Europe's stock markets, where the FTSE 100 is up 10 points in early trading. That's partly because the blue-chip index got its retaliation in first, dropping 2% last night.

David Buik of Cantor Index comments:

This morning we had expected a dead-cat-bounce, but it was not to be thanks to the Nikkei falling 5.15% today thanks to a strong Yen and lower export forecasts.

8.20am BST

Spain’s economy shrank 0.5% in Q1

Over to the eurozone, and confirmation that the Spanish economy continued to shrink steadily this year.

Final GDP data, just released, showed that Spain's economic output dropped by 0.5% in the first three months of 2013, and was 2% smaller than a year ago. That's in line with the initial estimate, and shows the economy has been in recession for the last seven quarters.

It also reinforces the need to give Spain two more years to lower its deficit to 3% of GDP – a decision announced yesterday by the European Commission.

8.09am BST

Economics minister: We aren’t anxious about the markets

Japanese economics minister Akira Amari has insisted that the country's government will not be blown off course by events in the stock market.

Reuters has the details:

Amari said the Bank of Japan is taking appropriate actions to seek stability in the Japanese government bond market through communication with market participants.

Amari, speaking at an international conference held in Tokyo, also said that the government continues to closely monitor the market for its ability to digest JGBs.

He repeated that the government will pursue economic policies without feeling anxiety about the recent volatile movement in stock markets.

Japanese government bonds have risen in value this morning, which lowered the yield (the effective interest rate) on its 10-year debt at 0.89%.

There was alarm this week when this yield hit 1%, as it suggested traders were losing faith in 'Abemonics' and ditching the country's debt. Yields are still up sharply since the start of April:

Updated at 8.11am BST

7.59am BST

Fed fears

Today's 5% slide on the Nikkei is also due to concern that the US Federal Reserve will begin the process of slowing, or 'tapering', its own stimulus package soon.

One hedge fund manager told Reuters that Fed fears are a bigger factor than the rising yen (which is up around 0.5% at ¥100.6 to the US dollar):

The rising yen is just a minor reason that triggered further selling. The fundamental concern that's been in investors' heads is the possibility that the Fed is exiting from quantitative easing.

And here's a list of the biggest fallers in the Nikkei today:

Biggest fallers on the Nikkei, May 30 2013
Photograph: Thomson Reuters

7.43am BST

Japanese stock market falls again

Good morning, and welcome to our rolling coverage of events across the eurozone and the world economy.

Japan's stock market has tumbled again, as fears over the country's stimulus package and the hit shares in Tokyo.

The Nikkei slid by nearly 5.2% in a nervy day's trading, prompting the country's finance minister to urge people not to overreact. All but two of the 225 shares in the benchmark index fell.

The Nikkei lost 737 points to finish at a five-week low of 13,589, meaning it has lost 14% since its 'intraday' peak last Wednesday. This puts the index in 'correction territory' (defined as a drop of 10% or more), although it's still up by a third this year.

Japan's Nikkei, 3 months to May 30
The Nikkei over the last three months. Photograph: Thomson Reuters

Exporters led the selloff, with Fast Retailing – Asia's largest clothes vendor – sliding by 11.11%. The yen rose against the US dollar, raising concerns that Japanese firms will find it harder to sell abroad.

Soichiro Monji, chief strategist at Tokyo-based Daiwa SB Investments, told Bloomberg:

Selling is feeding into more selling.

It’s mind-boggling that this market, which is one of the most liquid in the world, can move so much in one day like this.

Traders also blamed nervousness over the prospects for the Japanese economy. Economic data due out tomorrow will show whether prime minister Shinzo Abe's stimulus package is succeeding in stimulating growth.

More reaction to follow, along with rolling coverage of other events through the day…..

Updated at 7.50am BST © Guardian News & Media Limited 2010

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