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Chilean Stocks: Copec, Lan, Ripley and Sud Americana de Vapores.The following companies had unusual price changes in Chilean trading. Stock symbols are in parentheses and prices are as of 3:13 p.m. New York time. The Ipsa index rose 5.1 percent to 3,889.01. The MSCI Chile (MXCL) index surged 7 percent to 2,096.89, its biggest gain since October 2008. Cia. Sud Americana de Vapores SA (VAPORES CC) rose 2.4 percent to 123.88 pesos. Oscar Hasbun, CSAV’s head of container shipping, said yesterday that while results this year will be “very negative,” the shipping industry has an “attractive” longer-term outlook. Lan Airlines SA (LAN) jumped 4.4 percent to 11,223 pesos, its second day of gains. Latin America ’s largest airline by market value said in a statement that Spain ’s antitrust regulator approved without conditions its planned acquisition of Brazil ’s Tam SA. Empresas Copec SA (COPEC) rose 7.5 percent to 6,500 pesos, the biggest advance in three years. Chile’s biggest pulp exporter rallied along with prices of raw materials amid speculation that European officials will contain the region’s fiscal woes. Ripley Corp SA (RIPLEY) surged 11 percent to 449.73 pesos, the most in three years. The department store operator led gains among members of the Ipsa index as global stocks rose after European officials detailed plans to tame the sovereign debt crisis. To contact the reporters on this story: James Attwood in Santiago at jattwood3@bloomberg.net ; Eduardo Thomson in Santiago at ethomson1@bloomberg.net To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net |
CDC, La Poste to Form Venture for Dexia Muni Assets, Union Says.France ’s state-owned Caisse des Depots et Consignations and La Poste are joining with Dexia SA (DEXB) to create a new company to take over Dexia’s French municipal lending arm, La Poste’s union said. The company would be 65 percent owned by CDC, 5 percent by La Poste and 30 percent by Dexia, according to a statement today from the La Poste union whose representatives attended a board meeting yesterday where the plan was presented. Separately, La Poste and CDC plan to create a joint venture to sell new loans to local governments, the union said. The venture, owned 65 percent by La Poste and 35 percent by CDC, would take on the staff of Dexma, the French municipal lending unit of Dexia, according to the statement. To contact the reporter on this story: Fabio Benedetti-Valentini in Paris at fabiobv@bloomberg.net To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net |
Synthetic Grass Company Polytan Seeks Buyer, FT Deutschland Says.Polytan GmbH’s owners IK Investment Partners have hired Macquarie to find a buyer for the German maker of synthetic grass, Financial Times Deutschland said, without saying where it got the information. Polytan is valued at 300 million euros ($400 million) to 350 million euros including debt, the German newspaper said, citing unidentified people from the financial industry. The deadline to submit a bid was about two weeks ago and the auction is now in the second round, FTD said. The maker of synthetic grass for football and hockey stadiums has annual sales of about 300 million euros and earnings before interest, tax, depreciation and amortization of about 40 million euros, FTD said. To contact the reporter on this story: Sheenagh Matthews in Frankfurt at smatthews6@bloomberg.net To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net |
Canada September IVEY Index: Summary.Business activity in Canada slowed in Sept., according to the Ivey Purchasing Managers Index. The association’s monthly index of business activity fell to 55.7 last month, compared with 56.4 in August. An index above 50 means the number of firms who said business improved was greater than the number saying it deteriorated. To contact the reporter on this story: Ilan Kolet in Ottawa at ikolet@bloomberg.net To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net |
Crescent Said to Sell Stake in $2 Billion of Texas Buildings to JPMorgan.Crescent Real Estate Holdings LLC sold its stake in six Texas office properties valued at about $2 billion to its partner, a unit of JPMorgan Chase & Co. (JPM) , a person with knowledge of the transaction said. The acquisition, completed Sept. 28, gave J.P. Morgan Asset Management full ownership of Houston Center and The Crescent office and retail complex in Dallas, said the person, who asked not to be identified because the information is private. The six properties have 9.1 million square feet (845,000 square meters) of space, said the person, who declined to give the price for Crescent Real Estate ’s 24 percent stake. Crescent has been selling assets as the commercial real estate market recovers from the recession. Well-leased office buildings with steady income have attracted institutional clients as yields on other investments hover near record lows. J.P. Morgan Asset bought two Seattle office towers from developer Schnitzer West LLC for $480 million in August. Crescent has been owned since November 2009 by a joint venture between Barclays Capital , a unit of Barclays Plc (BARC) , and Fort Worth-based Goff Capital Inc. Goff is led by John Goff, who was vice chairman and chief executive officer of Crescent’s predecessor company, Crescent Real Estate Equities Co., when it was acquired by Morgan Stanley for $6.5 billion in 2007. Kristen Chambers, a spokeswoman for J.P. Morgan Asset Management, declined to comment. Brandon Ashcraft, a Barclays Capital spokesman, had no immediate comment. Jean Suitt, a spokeswoman for Crescent, referred questions to John Goff, who she said wasn’t available for comment. Real Estate Alert reported last week that the deal was imminent. Value Includes Debt Crescent will continue to operate the properties, according to the person with knowledge of the deal, who said the estimated $2 billion value of the buildings includes debt. Aside from Houston Center and The Crescent, the properties include Fulbright Tower in downtown Houston, Post Oak Central in Houston’s West Loop/Galleria section, and Fountain Place and Trammell Crow Center in Dallas. Houston Center has three office buildings, the tallest of which is 46 stories. The complex is connected via sky-bridges to a Four Seasons Hotel and the 52-story Fulbright Tower. Post Oak Central has three 24-story buildings designed by Philip Johnson. Fountain Place, in downtown Dallas, is a 60- story, prism-shaped building of green glass designed by I.M. Pei & Partners. Trammell Crow Center, also downtown, has 50 floors. Crescent continues to own Greenway Plaza, a 52-acre (21- hectare), 10-building office, retail, hotel and residential complex near downtown Houston, as well as office buildings in Denver, Fort Worth and Las Vegas. It also has a Ritz-Carlton Hotel in Dallas, and Canyon Ranch spas in Tucson, Arizona , and Lenox, Massachusetts. To contact the reporter on this story: Hui-yong Yu in Seattle at hyu@bloomberg.net To contact the editor responsible for this story: Kara Wetzel at ketzel@bloomberg.net |
PIK Will Invest $399 Million in Moscow Project, Vedomosti Says.PIK Group (PIKK) , a Russian residential real-estate developer, may invest 13 billion rubles ($400 million) over four years in a new project in Moscow, Vedomosti reported today, citing Artem Eyramdzhants, the company’s first vice president. To contact the reporter on this story: Yuliya Fedorinova in Moscow at yfedorinova@bloomberg.net To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net |
Osg Corp Announces Planned FY Group Dividend of 18.00 Yen.Osg Corp (6136) (6136) announced full-year group dividend estimates for the period to Nov. 30. Figures are in yen. ================================================================================ Forecast Previous Dividend ================================================================================ Full-Year Dividend 18.00 12.00 1st-Half Dividend N/A 6.00 2nd-Half Dividend 12.00 8.00 ================================================================================ To contact the editor responsible for this story: Teo Chian Wei at +81-3-3201-3623 or cwteo@bloomberg.net |
Singapore’s Fuel Stockpiles Fall 7.6% From Last Week.Singapore’s total oil-product inventories fell 7.6 percent. Inventories in Asia ’s biggest oil-trading center fell 3,288 thousand barrels to 40,069 thousand barrels in the week ended yesterday, said International Enterprise Singapore, a unit of the trade ministry. The agency didn’t give a reason for the decline. The following table provides a weekly comparison of the oil inventories for six weeks. Inventory figures are in thousands of barrels. ========================================================================== Oct.5 Sep.28 Sep.21 Sep.14 Sep.7 Aug.31 2011 2011 2011 2011 2011 2011 ========================================================================== ----------------- Thousand barrels ------------------ Total 40,069 43,357 41,494 42,560 42,143 43,577 Light distillates 10,317 9,455 9,061 8,436 9,157 8,780 Middle distillates 12,732 14,136 13,576 12,849 11,981 13,257 Residues 17,020 19,766 18,857 21,275 21,005 21,540 -------------------------------------------------------------------------- ========================================================================== Oct.5 Sep.28 Sep.21 Sep.14 Sep.7 Aug.31 2011 2011 2011 2011 2011 2011 ========================================================================== ----------- Weekly change (’000 barrels) ------------ Total -3,288 1,863 -1,066 417 -1,434 574 Light distillates 862 394 625 -721 377 -1,037 Middle distillates -1,404 560 727 868 -1,276 259 Residues -2,746 909 -2,418 270 -535 1,352 -------------- Weekly change (Percent) -------------- Total -7.6% 4.5% -2.5% 1.0% -3.3% 1.3% Light distillates 9.1% 4.3% 7.4% -7.9% 4.3% -10.6% Middle distillates -9.9% 4.1% 5.7% 7.2% -9.6% 2.0% Residues -13.9% 4.8% -11.4% 1.3% -2.5% 6.7% ========================================================================== Note: Light distillates include naphtha, processed from crude oil and turned into chemicals and plastics. It does not include gases. Residues include fuel oil , which is used as ship fuel and burned by power plants to generate electricity. Residues excludes bitumen. Source: International Enterprise Singapore |
Lazard Hires Real-Estate Investment Team From Grubb & Ellis.Lazard Ltd. (LAZ) , the financial-advisory and asset-management firm, hired a real-estate investment team from Grubb & Ellis Alesco Global Advisors. Jay Leupp and David Ronco lead the group, which also includes Christopher Hartung to focus on investment strategy and research and Kipp Kjeldgaard for client service and business development, Hamilton, Bermuda-based Lazard said today in a statement. The team will be based in Lazard Asset Management’s San Francisco office. Leupp founded Alesco Global Advisors in 2006 and was the senior portfolio manager of its real-estate mutual funds. Ronco was previously a portfolio manager for the funds. “Our new global real-estate securities team includes seasoned professionals with deep experience in real-estate analysis and investing,” Ashish Bhutani, chief executive officer of Lazard Asset Management, said today in the statement. Lazard shares, which have lost 41 percent this year, rose $1.10, or 5 percent, to $23.29 at 2:57 p.m. in New York Stock Exchange composite trading. To contact the reporter on this story: Laura Marcinek in New York at lmarcinek3@bloomberg.net To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net |
U.S. Aug. Single Family Attached Home Prices.Following is the monthly transaction based price changes for single family homes, attached homes only, in the U.S. from First American CoreLogic, LoanPerformance. Source: First American LoanPerformance HPI To contact the reporter on this story: Alex Tanzi in Washington at atanzi@bloomberg.net To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net |
Thai Flood Damage May Rise to 130 Billion Baht, University Says.Thailand ’s seasonal floods may cause as much as 130 billion baht of damage and reduce economic growth by up to 1.3 percentage points, the University of the Thai Chamber of Commerce said today. The new estimate includes the cost of flooding in southern Thailand in April and May, in addition to damage caused by a deluge that began in July, the university said in a statement. The university cut its economic growth forecast for this year to 3.6 percent from a May estimate of 4.4 percent because of the floods and the faltering global recovery. To contact the reporter on this story: Suttinee Yuvejwattana in Bangkok at suttinee1@bloomberg.net To contact the editor responsible for this story: Tony Jordan at tjordan3@bloomberg.net |
TCU’s Invitation to Join Big 12 May Spark Wave of Switches by Universities.Texas Christian University has received an invitation to become the 10th member of the Big 12 Conference, potentially setting off a new wave of colleges switching leagues. The Horned Frogs had earlier committed to join the Big East Conference beginning in July of 2012. The school will have to pay a $5 million exit fee, but because it wasn’t an official member, it won’t have to wait 27 months to change conferences. CBSSports.com reported that if the University of Missouri stays in the Big 12, the conference will probably stay at 10 teams. That may not happen, based on today’s statement. “Acting upon a unanimous recommendation of its expansion subcommittee, the Big 12 Conference Board of Directors this morning authorized negotiations with Texas Christian University,” the Big 12 said in the statement. “On the advice of legal counsel the University of Missouri did not participate in the vote.” Phone calls and e-mails to TCU spokesmen Mark Cohen and Andy Anderson; Big East spokesman John Paquette; and Missouri spokesman Chad Moller, weren’t immediately returned. If the Tigers leave, the conference might look to add three more schools to bring the conference back to 12 teams. CBSSports.com reported that leading candidates would include the University of Louisville, West Virginia University and the University of Cincinnati from the Big East and Brigham Young University, an independent. The Big East earlier lost the University of Pittsburgh and Syracuse University to the Atlantic Coast Conference. To contact the reporter on this story: Curtis Eichelberger in Washington at ceichelberge@bloomberg.net To contact the editor responsible for this story: Michael Sillup at msillup@bloomberg.net |
ICE Daily Cocoa Stockpiles by Location for Oct. 6.Following is a table detailing cocoa stockpiles held at port warehouses monitored by the ICE Futures U.S. exchange: SOURCE: IntercontinentalExchange To contact the reporter on this story: Mike Sebany in Washington at msebany@bloomberg.net To contact the editor responsible for this story: Alex Tanzi at atanzi@bloomberg.net |
Barclays’ Absa Merges Banking Units, Names Africa Committee.Absa Group Ltd. (ASA) , Barclays Plc (BARC) ’s South African bank, combined its retail and business divisions to boost efficiency and named a joint committee with its British parent to oversee growth in Africa. Bobby Malabie, head of Absa business banking, will lead the combined unit, Chief Executive Officer Maria Ramos said in an e- mailed statement today, while Gavin Opperman, the previous retail chief, has resigned. Absa also granted some executives pan-African responsibilities. The Africa committee will be composed of managers from both Absa and Barclays, which owns 56 percent of the Johannesburg- based lender after buying a controlling stake in 2005. The move may be a step toward Absa acquiring Barclays’ other African units, said Patrice Rassou of Sanlam Investment Management. The joint retail and business arm mirrors the structure used by smaller rival Nedbank Group Ltd. (NED) to cut costs. “I think the changes will make Absa’s business more efficient,” said Rassou, who who helps manage about 330 billion rand ($41 billion) in Cape Town. Sanlam holds Absa shares. Barclays and Absa are working to increase profit as African growth outpaces developed economies. London-based Barclays’ regional office in charge of Africa is moving from Dubai to Johannesburg, with the relocation expected to be complete by the end of December, Absa said. Expanded Responsibilities Chief Financial Officer David Hodnett and Stephen van Coller, who heads the Absa Capital investment bank, will expand their responsibilities to include all African operations, Absa said. Standard Bank Group Ltd., Africa’s largest lender, has also promoted managers to head pan-continental units rather than focus on South Africa alone. The Africa committee will include Ramos, van Coller and Absa deputy CEO Louis von Zeuner, as well as Barclays Africa’s David Skillen and Philip Freeborn, chief operating and integration officer for Africa. Among other appointments announced today, Willie Lategan was named to head Absa’s so-called bancassurance business for Africa and will also join the African executive committee. Nomkhita Nqweni, chief of Absa’s wealth-management unit, will join the bank’s executive committee. To contact the reporter on this story: Renee Bonorchis in Johannesburg at rbonorchis@bloomberg.net To contact the editors responsible for this story: Edward Evans at eevans3@bloomberg.net |
United Tractors to Pay 185 Rupiah a Share Interim Dividend.PT United Tractors plans to pay an interim dividend of 185 rupiah a share in November, Corporate Secretary Sara Loebis said in Jakarta today. To contact the reporter on this story: Eko Listiyorini in Jakarta at elistiyorini@bloomberg.net To contact the editor responsible for this story: Berni Moestafa at bmoestafa@bloomberg.net |
Canadian Dollar Falls on Economic Slowing Before Nations’ Jobs Reports.Canada ’s dollar fell versus a majority of its major peers before domestic and U.S. jobs data that may show the North American economy is faltering. The loonie, as the Canadian currency it’s nicknamed, touched the lowest level in more than a year against its U.S. counterpart this week on concern a slowing American economy will crimp the nation’s exports of raw materials. The currency underperformed its commodity-linked peers of Australia and New Zealand and Brazil , which rallied along with stocks. “Investors are very cautious ahead of dual payroll numbers and expectations are sliding lower for both reports,” said Blake Jespersen, director of foreign exchange in Toronto at Bank of Montreal, by e-mail. “I don’t think the Canadian dollar selling is overdone. I think it will slide lower.” The Canadian currency dropped against 14 of its 16 major peers, falling the most, or 2.6 percent, against the Brazilian real. It rose 0.3 percent to C$1.0371 per U.S. dollar at 5 p.m. in Toronto, compared with C$1.0402 yesterday. It touched C$1.0658 on Oct. 4, the weakest level since August 2010. One Canadian dollar buys 96.42 U.S. cents. BMO’s Jespersen predicted the currency would hit a floor at around C$1.12. Canadian employers added 15,000 jobs in September after cutting 5,500 positions in August, according to the median of 25 estimates compiled by Bloomberg. That would mean employers added 16,500 jobs in the third quarter, compared with 109,000 in the second quarter and 82,800 in the first three months of the year. Statistics Canada is due to report the employment data tomorrow at 7 a.m. in Ottawa. Jobs U.S. businesses added 90,000 workers to payrolls in September, according to the median forecast of economists surveyed by Bloomberg. The unemployment rate was 9.1 percent for a third consecutive month, the survey showed. The loonie fell today against its commodity-linked peers as investors sold the loonie to buy the dollars of Australia and New Zealand amid gains in stocks and oil. “Canada is the low-beta currency within the commodity block so as risk appetite emerges, investors tend to go long the higher-beta currencies and sometimes fund it out of the lower- beta currencies,” said Paresh Upadhyaya , head of Americas G-10 currency strategy at Bank of America Corp. in New York , in a telephone interview today. Beta refers to a currency’s sensitivity to changes in another variable. The currency extended losses after the European Central Bank failed to cut borrowing costs and domestic building permits unexpectedly fell. ‘Massive Threat’ “The underlying sentiment is: global economy slowing, central banks struggling to find further measures to ease and the global financial system is a massive threat to the global economy and nobody has done anything to stabilize it,” said Kit Juckes, head of foreign-exchange research in London at Societe Generale SA, by phone from London. European Central Bank officials left their benchmark rate at 1.5 percent, as predicted by 41 of 52 economists in a Bloomberg News survey. ECB President Jean-Claude Trichet said the region’s economy is facing “intensified downside risks,” and said the central bank will resume covered-bond purchases and reintroduce year-long loans for banks as the sovereign debt crisis threatens to freeze money markets. Government bonds fell, pushing the 10-year yield eight basis points higher to 2.22 percent. The yield touched a record low 1.994 percent on Oct. 4. ‘Wouldn’t Buy Canadian building permits fell for a second consecutive month in August. The value of municipal permits fell 10.4 percent to a seasonally adjusted C$5.9 billion ($5.7 billion), following a revised 0.4 percent decline in July, Statistics Canada said today in Ottawa. The drop was larger than any of the 12 responses to a Bloomberg survey of economists, which had a median forecast for a 0.3 percent advance. “I wouldn’t buy the Canadian dollar” at these levels, Societe Generale’s Juckes said. “You wouldn’t want to own the Canadian dollar until you had some comfort that the global risk environment was improving or the global economy wasn’t getting worse.” To contact the reporter on this story: Chris Fournier in Halifax, Nova Scotia at cfournier3@bloomberg.net To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net |
Peru’s Sol Heads for Biggest Two-Day Rise in Four Months on ECB Decision.Peru’s sol headed for its biggest two-day gain in four months as moves by the European Central Bank to shore up the euro region’s money market spurred demand for higher-yielding, emerging-market assets. The sol strengthened 0.5 percent to 2.7485 per U.S. dollar at 12:31 p.m. New York time, from 2.7630 yesterday. The currency rose 0.5 percent yesterday. The ECB will start buying covered bonds and offer banks two additional unlimited loans, ECB President Jean-Claude Trichet said today after policy makers left the benchmark interest rate at 1.5 percent. “Overseas investors are buying soles again as international markets are calmer,” said Mario Guerrero , an economist at Scotiabank Peru in Lima. Peruvian banks may seek to reduce their “heavy” dollar holdings as the sol strengthens, Guerrero said. Peru’s central bank will probably leave its benchmark rate at 4.25 percent for a fifth month today, according to 17 of 18 analysts in a Bloomberg survey. The bank will announce its decision at about 7 p.m. New York time. To contact the reporter on this story: John Quigley in Lima at jquigley8@bloomberg.net To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net |
Prices for Young Racehorses Surge as Sheikh Mohammed Spends at Top Auction.Prices for top young race horses at Europe ’s biggest auction jumped 30 percent following a slow-down in breeding and increased demand from Sheikh Mohammed bin Rashid Al Maktoum, the ruler of Dubai. The average price paid for a yearling - a one-year-old untrained thoroughbred racehorse - during the first two days at Tattersalls , Europe’s biggest bloodstock auctioneer, was 139,641 guineas ($226,254). The average price over the entire three-day sale last year was 107,445 guineas. The guinea, no longer in use and equivalent to 1.05 pounds, was the unit of currency often paid to artists and professionals. “Quality, that’s what these guys want,” Jimmy George, marketing director of Tattersalls, said in an interview near the auction ring where the auction finishes today. “If they land on a catalogue full of beautifully bred, very good-looking yearlings, then they are going to have fun and enjoy themselves and they are going to buy.” Top young racehorses have also become more expensive as breeding slowed amid the global economic downturn, George said. About 500 thoroughbreds were in the auction this year, compared with 689 horses during last year’s sales. “There is actually a decline in the numbers of animals being produced,” George said. “So we can tighten up the catalogue and you get supply and demand coming more in line, and that’s what everybody needs. Breeding thoroughbreds sadly is not a process you can just stop. Last year was the last of the pre- recession foal crop.” Sheikh’s Spending Accompanied by his chief buyer John Ferguson, Sheikh Mohammed has been the top buyer so far at Tattersalls, spending 5.4 million guineas. That’s 68 percent more than what the Dubai ruler spent over the entire auction last year. Irish millionaire John Magnier is the second-biggest spender with 3.6 million guineas. Total turnover over the first two days was 33.9 million guineas, compared with 48.2 million guineas over three days in 2010. The median price paid for a yearling so far is 100,000 guineas, or 30,000 guineas higher than last year. The most expensive yearling of the first two days was a bay filly by Galileo , which was sold for 800,000 guineas to Australian owner and breeder Paul Makin. He outbid Magnier for the filly, a half-sister of this year’s Derby winner Pour Moi. Galileo is the leading stallion of Magnier’s Coolmore operation. Another Galileo filly was bought by Alan Cooper for 700,000 guineas on behalf of the Greek Niarchos family. Magnier spent the same amount on a colt by Oasis Dream out of a Galileo mare. ‘Tricky Week’ It could have been “a tricky week,” to be selling Europe’s best young racehorses, given the global economic downturn and uncertainty about Europe’s debt crisis, Harry Herbert, managing director of Newbury, England-based Highclere Thoroughbred Racing , said in an interview at Tattersalls. “But at the moment, it’s not affecting the top end of our market,” he said. “Sheikh Mohammed is here and so is his brother Sheikh Hamdan, continuing their remarkable investment and support which the industry now is very dependent upon.” To contact the reporter on this story: Danielle Rossingh in Newmarket through the London newsroom on drossingh@bloomberg.net To contact the editor responsible for this story: Christopher Elser at celser@bloomberg.net |
Miraca to Buy Caris Life’s Pathology Unit for $725 Million.Miraca Holdings Inc. (4544) , Japan ’s biggest provider of medical tests, agreed to buy Caris Life Sciences Inc.’s pathology unit for $725 million, gaining laboratories in three U.S. states that service more than 3,500 patients daily. The purchase price includes the repayment of existing debt, and the deal is subject to a restructuring of closely held Caris Life Sciences’ businesses and other conditions, according to a statement to the Tokyo Stock Exchange today. Buying the pathology unit, also known as CDx, gives Tokyo- based Miraca a bigger share of a market that grew 40 percent annually over the past six years, the companies said. With more than 70 pathologists, CDx provides nationwide testing services from laboratories in Irving, Texas , where it’s based, Newton, Massachusetts , and Phoenix, according to the statement. “The acquisition of CDx will substantially expand Miraca’s footprint in the U.S. laboratory testing market, which is larger and faster-growing as compared to Japan,” the companies said. “Miraca will leverage this platform to further expand its presence in the U.S. through both internal and external opportunities.” The statement was made after markets in Japan closed. Miraca added 0.8 percent to 3,340 yen, compared with a 1.5 percent advance in the Topix index. The shares have increased 2.1 percent this year, while the benchmark index has lost 18 percent. Lazard Ltd. (LAZ) is advising Miraca in the transaction. To contact the reporter responsible for this story: Jason Gale in Singapore at j.gale@bloomberg.net To contact the editor responsible for this story: Jason Gale at j.gale@bloomberg.net |
San Miguel in Talks With CIMB to Sell Bank Stake, Ang Says.San Miguel Corp. (SMC) , the largest Philippine company by assets that’s seeking to expand in Malaysia, said it’s in discussions to sell a stake in Bank of Commerce to CIMB Group Holdings Bhd. (CIMB) “We’re in talks,” San Miguel President Ramon Ang said in an interview in Manila today. CIMB is “one of the biggest banks in Malaysia” and San Miguel plans to sell “a portion” of the Philippine lender to the Malaysian company, he said, declining to provide more details. The Philippine brewer has been expanding into oil refining, power and infrastructure to triple the return it previously earned from food and drinks alone. San Miguel agreed in August to acquire Exxon Mobil Corp.’s 65 percent stake in Esso Malaysia Bhd. and said it may spend as much as $1.2 billion upgrading Esso’s oil refinery and renovating gasoline stations. “A purchase by CIMB will pave the way for San Miguel to link with a strong partner in Malaysia, where it’s putting a substantial investment through its purchase of Esso,” said Alex Pomento, head of research at Macquarie Group Ltd. in Manila. CIMB “has the financial muscle to strengthen” the Philippine lender, he said. CIMB, Malaysia’s second-largest lender, confirmed the talks with San Miguel after the close of trading in Malaysia. “These discussions are currently at an early stage and further announcements will be made in the event of any material developments,” it said in an e-mailed statement. Bank Stake San Miguel said in June 2009 its property unit and retirement fund secured a 51 percent stake in Bank of Commerce. In January, San Miguel Properties Inc. (SMP) bought an additional 7.16 percent stake in the bank. Bank of Commerce is the Philippines ’s 16th-largest lender with assets of 90.7 billion pesos ($2.07 billion), data from the Bangko Sentral ng Pilipinas showed. CIMB, which also operates in Singapore and Indonesia , bought 70 percent of Thailand ’s Sicco Securities Pcl last month. CIMB and bigger rival Malayan Banking Bhd. said in June they were pulling out of separate talks to acquire Kuala Lumpur-based RHB Capital Bhd. CIMB rose 3.4 percent to 7.06 ringgit at the close in Kuala Lumpur trading, the highest in more than three weeks. San Miguel advanced 0.2 percent to 113.50 pesos at the noon close of trading in Manila, snapping three days of declines. “This is still part of their goal to raise the war chest and to consolidate into infrastructure,” said Jonathan Ravelas , a market strategist at Banco de Oro Unibank Inc. “It helps them raise capital and at the same time, a partnership with another group could open more doors for them.” --Clarissa Batino and Ian Sayson in Manila, Yen Kuan Gan and Pooi Koon Chong in Kuala Lumpur. Editors: Linus Chua, Russell Ward To contact the reporter on this story: Cecilia Yap in Manila at cyap19@bloomberg.net ; Joyce Koh in Singapore at jkoh38@bloomberg.net To contact the editors responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net ; Rebecca Evans at revans6@bloomberg.net |
Company Pension Deficit Jumps Most Ever as Stocks, Yields Plunge.Company pensions in the U.S. fell behind future payouts to retirees by the most ever in September, as stocks fell and the slowing economy and Federal Reserve policy drove down bond yields, according to actuarial and consulting firm Milliman Inc. The deficit between the assets of the 100 largest company pensions and projected liabilities widened by a record $124 billion in September to $439 billion, Seattle-based Milliman said today in a statement, based on data going back to 2000. Investment assets fell $31 billion to $1.175 trillion, while obligations to retirees rose $93 billion to $1.614 trillion. “We’ve been talking about how interest rates are driving pension funded status for several years now,” John Ehrhardt, a principal and consulting actuary in New York with Milliman, wrote Oct. 5 in an e-mail. “The perfect storm has been brewing all summer. In September the storm arrived with a vengeance.” Company pensions have suffered as bond yields, a benchmark in determining future liabilities, have been tamped down by the U.S. central bank’s efforts to ward off another recession as markets are buffeted by Europe ’s debt crisis. Companies have assumed a 7.75 percent median long-term rate of return on their assets, according to investment advisory firm CT Capital LLC, which tracks 1,423 corporations. This year the Standard & Poor’s 500 Index has lost 7.6 percent, U.S. corporate bonds have gained 4.9 percent as of Oct. 5, while Treasuries have returned 9 percent, according to Bank of America Merrill Lynch index data. No Relief “Given the Fed’s declaration that rates are going to remain low as far as the eye can see, a corporate board certainly can’t hope for anyone to ride to the rescue on that metric,” said Kenneth Hackel, president of CT Capital in Alpine, New Jersey , said Oct. 5 in a telephone interview. “Unless you think stocks are going to start rising by double digits per year for the next five years, then companies are going to have to fess up to these large liabilities.” Yields on 10-year Treasuries touched 1.67 percent, the lowest ever, on Sept. 23. Interest rates have declined as the Fed has kept its target rate for overnight loans between banks at a record low since December 2008. In August, the central bank promised to keep its target rate for overnight loans between banks near zero through mid-2013. Leading indicators show the world’s largest is falling into another recession, according to the Economic Cycle Research Institute. “You have wildfire among the leading indicators across the board, Lakshman Achuthan , the group’s chief operations officer in New York, said in a radio interview Sept. 30 on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt. Asset Rules The Pension Protection Act of 2006 requires companies to increase pension-fund assets gradually to put them on firmer financial footing, reducing the chances the government will have to rescue them. As bond yields decline, corporate pensions must set aside more money to cover future obligations to retirees. AA company debt yields were 3.22 percent, after falling to 2.72 percent on Aug. 4, the lowest since October 2010, according to Bank of America Merrill Lynch index data. Company pension plans are shifting away from U.S. stocks, with 38 percent expecting to reduce holdings this year after the same percentage did so in 2010, according to a survey by consulting firm Aon Hewitt in Lincolnshire, Illinois , of 227 U.S. employers with $389 billion in assets. The survey found that 32 percent of those companies plan to boost allocations to long-duration debt in 2011, 24 percent intend to increase other corporate bond holdings and 13 percent expect to boost their government debt allocation. “Investors are concerned about the low level of all-in yields on Treasuries,” Nicholas Finkelman, a money manager at New York-based Ryan Labs Inc., which oversees $3.5 billion, said Oct. 5. “Pensions are moving into higher corporate bond exposure on the back of this volatility.” To contact the reporter on this story: John Detrixhe in New York at jdetrixhe1@bloomberg.net To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net |
Riksbank’s Oeberg Signals Premature to Shelve Rate Rises.Swedish central bank First Deputy Governor Svante Oeberg signaled it may be premature to abandon a cycle of interest rate increases as Europe ’s debt crisis shows no signs of deteriorating since the bank’s September meeting. Europe’s leaders are “on a good path” toward solving the region’s fiscal woes, Oeberg said in an interview in Stockholm yesterday. “There is so far nothing that indicates” the crisis will result in a repeat of the 2008-2009 meltdown that followed the collapse of Lehman Brothers Holdings Inc., he said. Europe’s leaders are struggling to prevent the debt crisis that started in Greece from engulfing some of the euro region’s largest economies and banks. The European Central Bank yesterday said it will reintroduce 12-month loans for banks in an effort to stem the contagion. In Sweden , the Riksbank in September abandoned a planned rate rise citing Europe’s deteriorating recovery prospects, while signaling it may yet raise rates once more this year. “It looks pretty turbulent in Europe,” Oeberg said. “There hasn’t been much improvement, but it hasn’t become much worse either.” The krona rose 0.3 percent against the dollar to trade at 6.7969 as of 8:58 a.m. in Stockholm. Versus the euro, the krona gained 0.2 percent to 9.1378. Oeberg, according to the minutes of the bank’s September meeting, had said policy makers may need to “reconsider the monetary policy stance” should developments in Europe be “much worse than assumed.” Full Capacity The bank in September lowered its forecast for the rate path, while signaling it may raise the benchmark this quarter. It now sees the repo rate averaging 2.1 percent this quarter, down from 2.3 percent in its July report. The rate will average 2.4 percent in the third quarter next year, and 3 percent in the same quarter of 2013, it said. In a speech yesterday, Oeberg said the global financial crisis has lowered the potential economic growth rate meaning that resource utilization may be closer to normal than policy makers assume. “Resource utilization has a positive relationship with future inflation,” Oeberg said in the speech. It is “an indicator of future inflation,” he said. The bank announces its next interest rate decision on Oct. 27. The U.S. Federal Reserve in August said it will need to keep its main rate close to zero until the middle of 2013. In Europe, the ECB’s board considered cutting rates before agreeing to leave the benchmark at 1.5 percent for a third meeting, President Jean-Claude Trichet said. Sweden’s economy will grow 1.8 percent this year and 2.4 percent in 2012, the central bank estimated last month. Nordea Bank AB, the largest Nordic lender, predicts Sweden’s economy will grow just 0.8 percent next year. To contact the reporter on this story: Johan Carlstrom in Stockholm at jcarlstrom@bloomberg.net. To contact the editor responsible for this story: Tasneem Brogger at tbrogger@bloomberg.net |
Enbridge’s Oil Sands Project Is Years Early, Says IHS CERA.Enbridge Inc. (ENB) , Canada ’s largest pipeline operator, wouldn’t need to build the Northern Gateway project to export Alberta ’s oil-sands crude for almost a decade if TransCanada Corp. (TRP) ’s Keystone XL is approved this year, according to IHS CERA, an energy research company. The 732-mile (1,177-kilometer) Northern Gateway pipeline would pump 525,000 barrels a day from near Edmonton , Alberta, to the port of Kitimat, British Columbia, where crude would be loaded on tankers bound for Asia. The line, scheduled to start in 2017, would reduce Canadian dependence on U.S. markets and compete with the Keystone XL, designed to pipe 700,000 barrels a day to refineries in Texas along the Gulf of Mexico by 2013. Jackie Forrest, a director of global oil at IHS CERA, said there won’t be enough oil sands production to support Northern Gateway’s launch even if, as she expects, Keystone XL approval helps the output double in 10 years to 3 million barrels a day. “This Keystone XL pipeline is pretty big and there’s a fairly big refining infrastructure at the end of it, and just from a pure production-equals-pipeline perspective, you don’t need the pipeline to the West Coast until post-2020,” Forrest said yesterday in a telephone interview from Calgary. Enbridge reported in August that it had secured enough shipments to justify the C$5.5 billion line. Paul Stanway, a spokesman for the company, said Keystone XL “has no impact” on plans for the line to B.C. “We’re confident that all the product that we move through the pipeline will be purchased,” Stanway said in a telephone interview. “There is demand for it.” Sinopec Support Ten companies have contributed $10 million each to help Enbridge pay for steps in the regulatory approval process, with China Petroleum & Chemical Corp. (386) , Asia’s largest refiner, also known as Sinopec, the only company to state its participation publicly, Stanway said. He declined to provide more information on project partners, customers and projected volumes. Alberta’s bitumen-like oil sands give Canada the third- largest crude reserves in the world after Saudi Arabia and Venezuela , with 169 billion barrels of recoverable oil, according to Steve Rodrigues, a spokesman at the Canadian Association of Petroleum Producers. Not all Asian refiners are able to process the Canadian export, even if it’s mixed with 193,000 barrels a day of natural gas condensate that will be imported to Kitimat and pumped to Edmonton beside the westbound crude in a line that is part of the same project. Asian Demand “The appetite in the Asia-Pacific for the heavy crudes, given the relative absence of high-conversion refining, is really pretty limited,” Mark Gilman, an oil and gas analyst at The Benchmark Co., said in a telephone interview from New York. The long-term growth market for crude in Asia as it modernizes is an opportunity for Canada to diversify its markets, get better prices and reduce bottlenecks at Cushing, Oklahoma , where most Canadian crude ends up now, said Robert Mark, an oil sector equities analyst at MacDougall, MacDougall & MacTier Inc. in Toronto. “At the rate at which the oil sand production is growing and the stagnant nature of U.S. demand, oil sands producers will need a larger pool of markets in the future to maximize value,” Mark said in an e-mail. Canadian crude prices suffer by being priced alongside West Texas Intermediate crude delivered at Cushing. Brent’s premium to WTI surged to a record $26.87 a barrel on Sept. 6. Brent was 63 cents more expensive than WTI in 2010. Regulatory Steps The regulatory process for Northern Gateway is just getting under way compared with the Keystone XL project. The U.S. State Department, which has the final approval on the TransCanada line because it crosses an international border, has said it will make a decision by year’s end. Enbridge’s proposal faces a three-member Joint Review Panel of the National Energy Board and the Canadian Environmental Assessment Agency. They are preparing for hearings and environmental assessments that could take several years before issuing a final decision. The deadline is today for requests to make oral submissions starting in January. Northern Gateway faces opposition from environmentalists and Indian groups because it passes through the Great Bear Rainforest and raises the risk of supertanker oil spills in the Douglas Channel. However, the Canada-only route may make the project less prominent than Keystone XL, which has drawn protests from celebrities such as Daryl Hannah and Margot Kidder, who played Lois Lane in several Superman movies. “Northern Gateway would be an all-Canadian fight and thus perhaps could be less sensational and muscular, think Canadian Football League vs. U.S. NFL, but nonetheless might get very contentious,” Judith Dwarkin, chief energy economist for ITG Investment Research, wrote in an e-mail from Calgary. To contact the reporter on this story: Colin McClelland in Toronto at cmcclelland1@bloomberg.net To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net |
Yakuodo Co Lt Announces Planned FY Group Dividend of 3300.00 Yen.Yakuodo Co Ltd (3385) (3385) announced full-year group dividend estimates for the period to Feb. 29. Figures are in yen. ================================================================================ Forecast Previous Dividend ================================================================================ Full-Year Dividend 3300.00 3300.00 1st-Half Dividend N/A 0.00 2nd-Half Dividend 3300.00 3300.00 ================================================================================ To contact the editor responsible for this story: Teo Chian Wei at +81-3-3201-3623 or cwteo@bloomberg.net |
USDA Boxed Beef Cutout Midday Prices for October 6.October 6 (Bloomberg) -- This table details boxed beef cutout prices supplied daily by the U.S. Department of Agriculture. Prices and loads traded are as of 11:30 a.m. U.S. central time. Prices are determined from cuts in dollars a hundredweight and vary between higher-quality choice cuts and select beef cuts for sale f.o.b. Omaha, Nebraska. CHOICE SELECT 600-900 600-900 ------------------------------------------------------------------------------- Current Cutout Values: 184.68 169.99 Change from prior day: 0.44 (0.28) ------------------------------------------------------------------------------- Choice/Select spread: 14.70 Total Load Count (Cuts, Trimmings, Grids): 193 ------------------------------------------------------------------------------- COMPOSITE PRIMAL VALUES Primal Rib 289.25 230.99 Primal Chuck 152.98 150.51 Primal Round 168.23 167.51 Primal Loin 233.81 199.68 Primal Brisket 130.81 127.91 Primal Short Plate 126.08 129.30 Primal Flank 116.80 114.73 -------------------------------------------------------------------------------- LOAD COUNT AND CUTOUT VALUE SUMMARY FOR PRIOR 5 DAYS CHOICE SELECT Date Choice Select Trim Grinds Total 600-900 600-900 10/05 110 90 24 67 291 184.24 170.27 10/04 81 63 42 40 226 183.74 170.32 10/03 94 65 40 60 259 183.81 170.28 09/30 73 53 22 26 175 182.49 169.34 09/29 102 75 28 39 244 183.26 169.27 -------------------------------------------------------------------------------- Current 5 Day Simple Average: 183.51 169.90 -------------------------------------------------------------------------------- NATIONAL BOXED BEEF CUTS - NEGOTIATED SALES FOB Plant basis negotiated sales for delivery within 0-21 day period. Prior days sales after 1:30pm are included. CURRENT VOLUME - (one load equals 40,000 pounds) Choice Cuts 91.44 loads 3,657,532 pounds Select Cuts 42.05 loads 1,682,156 pounds Trimmings 34.48 loads 1,379,395 pounds Coarse Grinds 24.75 load 990,049 pounds ------------------------------------------------------------------------------- Choice Cuts, Fat Limitations 1-6 IMPS/FL Sub-Primal # of Total Price Weighted rades Pounds Range Average ------------------------------------------------------------------------------- 109A 1 Rib, roast-ready, heavy 109E 1 Rib, ribeye, lip-on, bn-in 14 25,433 560.00 621.00 584.40 112A 3 Rib, ribeye, bnls, light 6 9,768 637.00 706.00 689.06 112A 3 Rib, ribeye, bnls, heavy 41 93,549 604.00 685.00 645.92 113A 1 Chuck, square-cut, 2 piece 113C 1 Chuck, semi-bnls, neck/off 6 51,436 196.10 212.00 198.92 113C 3 Chuck, semi-bnls, neck/off 3 Chuck, semi-bnls n/o sh-cut 0 0 114 1 Chuck, shoulder clod 7 26,399 181.16 205.00 187.81 114A 3 Chuck, shoulder clod, trmd 27 233,187 194.00 214.00 203.44 114D 3 Chuck, clod, top blade 6 4,967 265.00 330.00 275.79 114E 3 Chuck, clod, arm roast 8 39,491 230.19 246.00 237.99 114F 5 Chuck, clod tender 8 20,161 345.00 395.00 361.01 115 1 Chuck, 2-piece, boneless 116A 3 Chuck, roll, lxl, neck/off 38 488,814 256.08 276.00 265.32 116B 1 Chuck, chuck tender 18 55,818 197.85 220.00 211.79 3 Chuck roll, retail ready 0 0 120 1 Brisket, deckle-off, bnls 28 154,368 187.97 206.00 193.97 120A 3 Brisket, point/off, bnls 19 29,358 329.00 360.00 340.65 123A 3 Short Plate, short rib 19 42,075 296.20 362.00 334.01 130 4 Chuck, short rib 8 11,429 200.00 260.00 223.71 160 1 Round, bone-in 5 6,185 198.00 205.00 199.28 161 1 Round, boneless 7 3,139 209.50 217.25 214.34 3 Round, bnls/peeled heel-out 167 1 Round, knuckle 167A 4 Round, knuckle, peeled 38 290,000 235.00 258.00 248.22 168 1 Round, top inside round 16 37,355 205.00 214.25 208.35 168 3 Round, top inside round 17 100,356 210.00 221.00 213.39 169 5 Round, top inside, denuded 11 9,161 245.00 256.00 250.91 3 Round, top inside, side off 170 1 Round, bottom gooseneck 3 1,030 205.00 210.00 205.70 171B 3 Round, outside round 16 87,525 234.00 250.00 237.96 171C 3 Round, eye of round 29 56,892 245.00 273.00 262.25 3 Round, flat/eye, heel-out 0 0 174 1 Loin, short loin, 2x3 174 3 Loin, short loin, 0x1 26 120,600 420.00 471.00 434.72 175 3 Loin, strip loin, 1x1 180 1 Loin, strip, bnls, heavy 1 Loin, strip loin bnls. 1x1 11 13,415 390.00 417.50 403.66 180 3 Loin, strip, bnls, 0x1 47 297,518 400.00 471.61 427.95 184 1 Loin, top butt, bnls, heavy 13 13,870 250.00 275.00 259.06 184 3 Loin, top butt, boneless 29 325,561 234.00 287.50 252.41 185A 4 Loin, bottom sirloin, flap 24 39,389 294.41 336.00 326.44 185B 1 Loin, ball-tip, bnls, heavy 16 30,910 225.00 251.00 244.53 185C 1 Loin, sirloin, tri-tip 20 41,982 276.00 296.00 281.53 185D 4 Loin, sirloin, tri-tip, pld 189A 4 Loin, tndrloin, trmd, heavy 17 29,401 958.02 990.35 982.90 191A 4 Loin, butt tender, trimmed 3 2,570 896.25 990.00 957.24 193 4 Flank, flank steak 9 16,507 417.00 505.00 433.77 ------------------------------------------------------------------------------- Select Cuts, Fat Limitations 1-6 IMPS/FL Sub-Primal # of Total Price Weighted Trades Pounds Range Average ------------------------------------------------------------------------------- 109A 1 Rib, roast-ready, heavy 0 0 109E 1 Rib, ribeye, lip-on, bn-in 14 18,207 419.00 451.25 426.19 112A 3 Rib, ribeye, bnls, light 7 10,292 480.00 505.00 494.99 112A 3 Rib, ribeye, bnls, heavy 21 40,416 459.70 480.00 465.93 113A 1 Chuck, square-cut, 2 piece 113C 1 Chuck, semi-bnls, neck/off 10 6,200 200.25 212.00 203.26 113C 3 Chuck, semi-bnls, neck/off 3 Chuck, semi-bnls n/o sh-cut 114 1 Chuck, shoulder clod 9 26,919 184.50 200.00 192.09 114A 3 Chuck, shoulder clod, trmd 24 54,327 196.70 210.15 201.12 114D 3 Chuck, clod, top blade 0 0 114E 3 Chuck, clod, arm roast 0 0 114F 5 Chuck, clod tender 8 25,832 340.00 376.00 351.80 115 1 Chuck, 2-piece, boneless 116A 3 Chuck, roll, lxl, neck/off 33 150,699 230.00 256.25 241.13 116B 1 Chuck, chuck tender 14 61,101 201.00 220.20 211.70 3 Chuck roll, retail ready 0 0 120 1 Brisket, deckle-off, bnls 14 87,639 187.00 207.21 188.83 120A 3 Brisket, point/off, bnls 123A 3 Short Plate, short rib 5 4,484 300.00 356.00 337.09 130 4 Chuck, short rib 3 3,218 212.75 257.00 242.19 160 1 Round, bone-in 0 0 161 1 Round, boneless 3 Round, bnls/peeled heel-out 167 1 Round, knuckle 167A 4 Round, knuckle, peeled 14 39,937 243.00 255.25 247.17 168 1 Round, top inside round 6 22,157 198.00 206.64 204.61 168 3 Round, top inside round 28 47,528 201.00 218.00 211.66 169 5 Round, top inside, denuded 5 11,065 240.73 250.00 243.39 3 Round, top Inside, side off 170 1 Round, bottom gooseneck 4 81,193 203.00 217.00 209.03 171B 3 Round, outside round 24 90,582 225.00 242.25 227.23 171C 3 Round, eye of round 22 81,822 250.00 270.00 253.85 3 Round, flat/eye, heel-out 0 0 174 1 Loin, short loin, 2x3 174 3 Loin, short loin, 0x1 10 29,965 360.00 379.50 361.81 175 3 Loin, strip loin, 1x1 180 1 Loin, strip, bnls, heavy 0 0 1 Loin, strip loin bnls. 1x1 180 3 Loin, strip, bnls, 0x1 17 54,502 345.00 373.00 353.03 184 1 Loin, top butt, bnls, heavy 14 240,900 186.00 205.00 195.11 184 3 Loin, top butt, boneless 17 47,004 204.50 220.65 213.53 185A 4 Loin, bottom sirloin, flap 8 124,359 285.00 311.39 290.41 185B 1 Loin, ball-tip, bnls, heavy 12 31,608 230.00 237.21 231.96 185C 1 Loin, sirloin, tri-tip 9 5,556 271.50 285.00 278.12 185D 4 Loin, sirloin, tri-tip, pld 189A 4 Loin, tndrloin, trmd, heavy 14 32,870 809.70 849.00 817.02 191A 4 Loin, butt tender, trimmed 0 0 193 4 Flank, flank steak 3 1,862 416.00 450.00 424.13 ------------------------------------------------------------------------------- CHOICE AND SELECT CUTS, Fat Limitatins (FL) 1-6 ------------------------------------------------------------------------------- 124 4 Rib, Back Ribs, Fresh 124 4 Rib, Back Ribs, Frozen 10 9,086 100.00 120.50 102.85 121D 4 Plate, Inside Skirt 25 115,932 315.00 350.00 338.26 121C 4 Plate, Outside Skirt 12 20,089 355.00 410.00 365.05 121E 6 Plate, Outside Skirt, pld 11 2,932 495.00 550.00 540.33 Cap & Wedge Meat 38 128,185 229.00 250.00 236.16 Pectoral Meat 24 66,896 234.70 255.00 242.25 ------------------------------------------------------------------------------- GROUND BEEF - STEER and HEIFER SOURC -- 10 Pound Chub Basis ------------------------------------------------------------------------------- Ground Beef 73% 16 133,677 142.00 150.00 146.73 Ground Beef 75% Ground Beef 81% 20 105,753 153.47 176.00 162.35 Ground Beef 85% Ground Beef 90% 0 0 Ground Beef 93% 8 27,322 213.31 217.63 215.29 Ground Beef Chuck 24 179,329 160.00 181.00 164.88 Ground Beef Round 15 57,457 176.76 190.00 181.51 Ground Beef Sirloin 0 0 -------------------------------------------------------------------------------- BLENDED GROUND BEEF - STEER, HEIFER and COW SOURCE -- 10 Pound Chub Basis -------------------------------------------------------------------------------- Blended Ground Beef 73% Blended Ground Beef 75% Blended Ground Beef 81% 7 14,640 168.30 183.60 174.99 Blended Ground Beef 85% Blended Ground Beef 90% Blended Ground Beef 93% Blended Ground Beef Chuck Blended Ground Beef Round Blended Ground Beef Sirloin -------------------------------------------------------------------------------- BEEF TRIMMINGS - STEER and HEIFER SOURCE -------------------------------------------------------------------------------- Fresh 50% lean trimmings 41 1,377,645 87.84 94.50 89.55 Frozen 50% lean trimmings -------------------------------------------------------------------------------- FAT LIMITATIONS (FL) DESCRIPTION Maximum Average Fat Thickness Maximum Fat at any point 1. 3/4" (19mm) 1.0" 2. 1/4" (6mm) 1/2" 3. 1/8" (3mm) 1/4" 4. Practically free (75% surface lean exposed) 1/8" 5. Peeled/Denuded 1/8" 6. Peeled/Denuded, surface membrane removed 1/8" -------------------------------------------------------------------------------- Items that have no entries indicate there were trades but not reportable because they did not meet the daily 3/70/20 guideline. Please refer to weekly LM_XB 459 as the item may qualify. -------------------------------------------------------------------------------- A cutout value is an average of the prices tallied for cuts of beef from cattle carcasses weighing 550-850 pounds. Cutout values are separated into three main product types. Fabricated loads are beef cuts taken from an animal's ribs, chuck, round, loin, brisket, short plate and flank; 50 percent loads are 50 percent lean beef trimmings. Ground loads may contain 73, 75, or 80 percent ground beef. A typical refrigerated truckload carries 40,000 pounds. Choice 1-3 grade is a better grade than Select 1-3, partly because Choice cuts have more fat, or marbling, than Select cuts. Grade quality is determined using a 1-5 yield grade scale. A rating of 1 is the highest ratio of muscle to fat, while 5 is the lowest. Marbling is an important flavor factor. |
Brazil May Cut Its Oil Royalties Income Further, Folha Reports.Brazil ’s federal government may agree to reduce its share of profits from highly productive oil fields by a further 700 million reais ($382 million) to help reach agreement on how to share oil royalties with non-producing states, Folha de S.Paulo reported, citing unidentified government officials. The government may cut the so-called special participation tax on lucrative fields to 42.5 percent from 50 percent, according to the newspaper. It had previously agreed to reduce the tax to 46 percent, Folha said. The extra measure, which would only go ahead if oil- producing states also agree to give up some of their income, would lead to a total reduction in the government’s oil revenue of as much as 2.5 billion reais next year, Folha said. To contact the reporter on this story: Karen Eeuwens in London at keeuwens@bloomberg.net To contact the editor responsible for this story: Telma Marotto at tmarotto1@bloomberg.net |
Greek ECB Reliance Declined for Second Month in August.Greek banks’ reliance on European Central Bank financing declined for a second month in August, the central bank said. Greek bank use of European Central Bank liquidity fell to 93.1 billion euros (124.9$ billion) in August from 96.3 billion euros the previous month, according to a statement posted on the Athens-based central bank’s website today. The reliance on emergency liquidity assistance, or ELA, was 6.4 billion euros in the month, according to Bloomberg calculations. Greece has committed to additional measures to secure a second bailout worth 159 billion euros after the European Union- led aid package of 110 billion euros agreed in May 2010 failed to convince investors the country could avoid a default. The balance of deposits held by businesses and households in Greek banks rose to 188.6 billion euros in August from 187.2 billion euros in July, according to a separate statement from the Bank of Greece (TELL) today. That was the first rise this year. Greek Finance Minister Evangelos Venizelos said in August there was a “clear return” of deposits to Greek banks for the first time in 2 1/2 years. Deposits by homes and businesses have declined 20.9 billion euros since December 2010, or 10 percent, as the economy shrinks under the weight of government-imposed austerity measures agreed in exchange for international financing. The economy is forecast to contract 5.5 percent of gross domestic product this year and 2.5 percent next year, according to the 2012 budget draft. To contact the reporter on this story: Natalie Weeks in Athens nweeks2@bloomberg.net To contact the editor responsible for this story: Angela Cullen at acullen8@bloomberg.net |
Bloomberg Weekly Consumer Comfort Index.The Bloomberg Consumer Comfort index rose last week to -50.2 from -53.0 a week earlier. Following is a table with the latest survey results: The CCI is reported in a four-week rolling average; this week’s results are based on telephone interviews among a random national sample of 1,000 adults in the four weeks ending Oct. 2. The results have a 3-point error margin. Field work by SSRS/Social Science Research Solutions of Media, Pa. The index is derived by subtracting the negative response to each index question from the positive response to that question. The three resulting numbers are added and divided by three. The index can range from +100 (everyone positive on all three measures) to -100 (all negative on all three measures). The survey began in December 1985. Survey questions: Would you describe the state of the nation’s economy these days as excellent, good, not so good, or poor? Would you describe the state of your own personal finances these days as excellent, good, not so good, or poor? Considering the cost of things today and your own personal finances, would you say now is an excellent time, a good time, a not so good time or a poor time to buy the things you want and need? SOURCE: Bloomberg News To contact the reporter on this story: Kristy Scheuble in Washington at kmckeaney@bloomberg.net To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net |
Dexia Is in Advanced Talks to Sell Luxembourg Unit, Frieden Says.Luxembourg Finance Minister Luc Frieden said Dexia SA (DEXB) is in advanced talks with an undisclosed international investor to sell Dexia Banque Internationale a Luxembourg SA. Speaking to reporters in Luxembourg, Frieden said talks should be concluded by the end of this month, adding that’s in the interest of the local bank to leave the Dexia group. He declined to identify the potential buyer. To contact the reporter on this story: Stephanie Bodoni in Luxembourg at sbodoni@bloomberg.net To contact the editor responsible for this story: John Martens at jmartens1@bloomberg.net |
World Food Prices Drop for Third Month on Slumping Grains, UN Agency Says.World food prices fell for a third month in September, the longest stretch of declines in more than two years, after grain prices slumped amid concern demand will be hurt by an economic slowdown. An index of 55 food commodities fell to 225 points last month from 229.5 points in August, the United Nation’s Rome- based Food and Agriculture Organization said. The gauge reached a record 237.7 points in February. Corn futures in Chicago had the biggest monthly slide in at least 50 years last month, dragging down other grains and taking pressure off rising living costs across the world. China ’s fourth-quarter consumer price index probably rose 4.5 percent, down from 5 percent in the third quarter, according to the median of nine estimates compiled by Bloomberg News. “The only reason prices are coming down is the economic slowdown,” Abdolreza Abbassian , a senior economist at the FAO, said by phone before the report. “If we get more bad demand news, I wouldn’t be surprised to see prices go lower.” The global economy will expand 4 percent this year and next, the International Monetary Fund said Sept. 20, cutting its June forecasts of 4.3 percent in 2011 and 4.5 percent in 2012. The last time the FAO food-price index dropped more than two months in a row was between July 2008 and February 2009, when the index slumped 37 percent from its previous peak of 224.1 points in June 2008. The gauge is still 16 percent above its year-earlier level of 194 points. Stocks and commodities dropped last month on concern about a possible Greek default and a spreading debt crisis in Europe. The MSCI Index of stocks fell 9.7 percent in September and the S&P GSCI Index of commodities dropped 12 percent. Corn Supplies U.S. supplies of corn were an estimated 1.128 billion bushels on Sept. 1, the Department of Agriculture said Sept. 30, about 20 percent more than the average prediction of 24 analysts in a Bloomberg survey and signaling slower demand for grain used in animal feed and fuel. “The key to the falling prices is what’s happening on the demand side,” the FAO’s Abbassian said. Corn dropped 23 percent on the Chicago Board of Trade in September, the biggest monthly decline in records going back to 1959. Wheat plunged 23 percent in the month, the biggest such drop since March 1974. The FAO Cereals Price Index dropped to 245.1 points in September from 252.4 in August, the lowest level since January. The price slide may attract buyers, according to Abbassian. Countries will spend a record $1.29 trillion on food imports in 2011, 21 percent more than in 2010, the FAO estimates. ‘Buy Now’ “A lot of people will say this is an opportunity so they’re going to buy now,” Abbassian said. “All you need is a couple million tons of purchases and that puts the market back up. The upside can be very fast.” The price of corn in Chicago is still 26 percent higher than a year earlier and rough rice has advanced 27 percent. Wheat has dropped 4.4 percent in the period. Higher food costs have sent “tens of millions of people” into poverty since late 2010, and the world’s hungry people may soon exceed 1 billion again, Oxfam International said Aug. 3. The number of malnourished people in the world fell last year to 925 million from 1.02 billion in 2009, according to the FAO. World food output will have to rise 70 percent by 2050 as the global population climbs to 9.2 billion from an estimated 6.9 billion in 2010, the FAO estimates. The price of staple foods including corn will more than double in two decades without action, Oxfam said in May. Growth to Slow Growth in agricultural output will slow to 1.7 percent a year through 2020, compared with 2.6 percent in the previous decade, the FAO and the Paris-based Organization for Economic Cooperation and Development said in a report in June. World cereal production will climb to 2.31 billion tons in 2011-12, the FAO said in a separate report today, raising its estimate by 3 million tons on increased forecasts for wheat and rice production. The FAO, set up in 1945 as a specialized UN agency, says it leads international efforts to defeat hunger and helps developing countries improve farming. Its mandate includes lifting nutrition levels and agricultural productivity. To contact the reporter on this story: Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net |
U.S. Drought Monitor Report for the Week Ending Oct. 4 (Text).Following is the text of the weekly U.S. Drought Monitor as released by the National Drought Mitigation Center in Lincoln, Nebraska : The Southeast: Areas of heavy rain again affected parts of this area, leading to some drought/dryness reductions in the central Carolinas and finally slicing a hole in the large D3 area centered on Georgia , in particular across the interior southeast, where totals of 4 to 8 inches fell during the last 2 weeks. Similar rainfall during this period in central and west- central Georgia was not quite adequate to bring a classification improvement, but was sufficient to justify scaling back the dryness and drought in southwestern Alabama. Light precipitation led to expansion of D0 to D3 conditions in western South Carolina and adjacent North Carolina , where about half of normal rainfall was observed over the last 30 days. South of these areas, D0 to D3 areas expanded southward in the central Panhandle and in parts of the northern Peninsula. Six- month deficits exceed one foot now in parts of the central Peninsula. Across southern Florida , rain has been spotty but locally heavy recently, and quite a few minor adjustments to the region’s D0 to D2 areas were made this week. The Northeast and Mid-Atlantic: Hit-and-miss light rainfall continued again in and near the areas of dryness in New York and West Virginia. As a result, the D0 areas were reconfigured a bit but their intensity remained unchanged. The South: Over 4 inches of rain soaked part of the central Lower Mississippi Valley, allowing D0 to D3 conditions to be scaled back to the west. Elsewhere, moderate to locally heavy rains fell on northeast Oklahoma and southern Missouri, but appeared insufficient to substantially change drought conditions there. In the rest of the region, the theme of the last year was again played out: Little or no precipitation, and increasing moisture deficits except in small isolated areas. Several small adjustments were made in parts of the region, but of course the sprawling D4 area centered on Texas can’t be depicted any more seriously than it already was. Some larger-scale changes included expansion of D4 with growing shorter-term deficits in southeast Oklahoma , a westward expansion of D0 to D3 conditions along the immediate southwestern Louisiana coast, and the extension of D1 conditions eastward to cover most of Arkansas. Several reports of dry pastures affecting livestock were noted, and despite recent near-normal precipitation, water supplies remain a concern in northwest Arkansas as well as throughout the large area of exceptional drought. The Ohio Valley: A swath of heavy rain (generally 4 to locally 8 inches) wiped out dryness in southern Indiana and adjacent areas, but in other sections, specifically south-central Kentucky and areas from west-central Indiana westward, dryness and drought persisted. The Plains and Midwest: Several inches of rain eased dryness and drought in the upper Peninsula of Michigan , and more moderate rains kept drought depictions unchanged in the remainder of the Great Lakes region. Farther west and south, in areas from central Kansas to northern Missouri and northward through the eastern Dakotas and Minnesota , short-term but intense dryness has led to the rapid development and expansion of dryness and drought. Many areas have received less than one-quarter of normal precipitation in the last 30 to 60 days, along with above normal temperatures. The rapid development of dryness quickly depleted topsoils, even leading to fires in some brush and even crop areas. Drought now covers areas from southeast Iowa to eastern South Dakota, with severe drought now observed in southern Minnesota. The West: A re-assessment of rainfall during the past few months led to a reduction from D4 to D3 conditions for a small area in southeast New Mexico, but otherwise, light precipitation at best kept existing dryness and drought intact from the High Plains westward through the Rockies and Intermountain West. Hawaii , Alaska and Puerto Rico: Drought conditions remained unchanged in Alaska and Puerto Rico this week. In Hawaii, further degradation was noted D1 to D3 conditions expanded in northeastern sections of the Big Island. Farther south, D3 was introduced along part of the southern Big Island coastal areas. Looking Ahead: During October 5 - 10, 2011, a dramatic and long- overdue swath of moisture should push into the central and western Plains states, dropping over an inch of rain on a broad area from the northwestern half of Texas (except the Big Bend) northward through Nebraska and the adjacent Dakotas and Minnesota. Totals may reach 3.5 to 5.5 inches in central Nebraska and also southeastern parts of the Texas Panhandle. Farther east, a tropical system should spread heavy rains across Florida, southeastern Georgia, and adjacent South Carolina. Over 1.5 inch is expected through this region, with as much as 8 inches possible along the southeast Florida coast. Elsewhere, anywhere from a few tenths of an inch to a couple of inches of precipitation should fall on parts of the Rockies, with light rain at best in other areas of dryness and drought. For the ensuing 5 days (October 11 - 15, 2011), odds favor a return to dryness from the central and southern Intermountain West eastward through the southern Plains and middle Mississippi Valley, including most of Texas. In contrast, wet weather is favored in the northern Rockies and in the dry areas of the Southeast. SOURCE: National Drought Mitigation Center To contact the reporter on this story: Mike Sebany in Washington at msebany@bloomberg.net To contact the editor responsible for this story: Alex Tanzi at atanzi@bloomberg.net |
Euro to Weaken as ECB Moves Toward Rate Cuts: Analysts’ Comments.Analysts discuss the European Central Bank ’s decision to leave its benchmark interest rate unchanged at 1.5 percent. ECB President Jean-Claude Trichet said the ECB will resume covered-bond purchases and reintroduce year-long loans for banks to counter the debt crisis. The comments were made in telephone interviews and in client notes today: Niels Christensen , chief currency strategist at Nordea Bank AB in Copenhagen: “It’s not a complete surprise, although some people were looking for a possible cut.” “Having hiked twice this year already, it’s a bit difficult for them to start easing so soon. “Eventually they will cut rates; probably late this year and then in the spring of next year. “We’re negative on the euro and see it going down to about $1.20 in 12 months.” John Hardy , head of foreign-exchange strategy at Saxo Bank A/S in London: “It was always unlikely that they’d move lower given that their last hike was so recent. “Trichet is ‘Mr. Vigilance,’ so reversing policy so soon would be like admitting he was wrong. “The market still has a couple of cuts priced in over the next 12 months and I’d concur with that. “It’ll be interesting to see the extent of the ECB’s covered bond purchases and whether they move to de facto QE.” Julian Callow, chief European economist at Barclays Capital in London: “We still expect the ECB to ease policy given the impending recession risks in the euro area, but we must reckon with that adjustment coming later rather than being more pre- emptive.” To contact the reporter on this story: Garth Theunissen in London gtheunissen@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net |
Huaku Development Buys NT$883 Million of Land in Taipei City.Huaku Development Co. bought 442 square meters of land for NT$883 million in Taipei city from Oct. 27, 2010 to Oct. 6, the company said in a statement to the Taiwan stock exchange today. To contact the reporter on this story: Adela Lin in Taipei at alin95@bloomberg.net To contact the editor responsible for this story: tim culpan at jong3@bloomberg.net |
U.K. Universities Seen Suffering From Government Reform Plans.Britain’s reputation as a center of excellence in higher education may be damaged by government proposals to reform the universities, according to the compilers of this year’s World University Rankings. “The U.K. is blessed with some truly brilliant universities, more brilliant than the government understands, judging by its hastily concocted higher education reforms, with all the uncertainty they entail,” said Ann Mroz, the editor of the London-based Times Higher Education , in a report accompanying the list. THE published the list today with data from Thomson Reuters Corp. There are 32 U.K. universities in the top 200, more than any other country apart from the U.S., which has 75. Seven U.K. institutions are in the top 50, with Oxford University , Cambridge University and Imperial College London in the top 10. “We spend much less on our universities than many of our competitors,” yet “outperform almost all of them,” Mroz said. The U.K. spent 1.2 percent of its gross domestic product on tertiary education in 2008, compared with an average of 1.5 percent for countries belonging to the Organization for Economic Cooperation and Development, according to an OECD report on education published last month. Only Italy , Slovenia and the Slovak Republic spent less. As part of austerity measures designed to cut the budget deficit , the U.K. government is withdrawing direct subsidies for humanities courses and allowing universities to increase tuition fees to as much as 9,000 pounds ($13,800) a year, or more than three times the current maximum, a move that met with widespread student protests last December. Compete for Students The government published a Higher Education White Paper in June, outlining proposals to encourage universities to compete for students by giving more information about teaching quality and allowing successful institutions to expand. The intention is to remove quotas that cap a university’s intake. Phil Baty, who edited the global rankings, said he’s concerned about the likely effect of the proposed reforms on the strength and reputation of British universities. In a telephone interview, he questioned the consequences of much higher undergraduate tuition fees for “homegrown postgraduates and the next generation of researchers.” In July, the government proposed higher pension contributions for public-sector workers, including an increase of 300 million pounds for teachers. It has also tightened visa requirements and abolished the post-study work visa for graduate students, starting next year. “There’s an explosive mixture,” Baty said. “We’re one of the best in attracting international students and yet we’re putting restrictions on visas that could damage a great source of income and a great source of diversity on campus.” Other countries, particularly the U.S., are becoming “more aggressive and competitive” in attracting students from abroad, he said. Germany and the Netherlands have 12 universities each in the THE top 200, followed by Canada with nine and Australia with seven. To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net To contact the editor responsible for this story: Colin Keatinge at ckeatinge@bloomberg.net |
Canadian Natural Gas Falls on Larger-Than-Average U.S. Storage.Canadian natural gas fell as a U.S. government report showed stockpiles increased more than average last week, weakening demand for the power-plant fuel. Prices declined 1.1 percent after the Energy Department said gas stockpiles rose 97 billion cubic feet in the week ended Sept. 30 to 3.409 trillion cubic feet. The five-year average change for the week is an increase of 74 billion, department data show. Analyst estimates compiled by Bloomberg showed an expected gain of 98 billion. Alberta gas for November delivery fell 3.75 cents to C$3.24 per gigajoule ($2.95 per million Btu) as of 3:05 p.m. New York time, according to NGX, a Canadian Internet market. December gas dropped 5.5 cents to C$3.485. Gas traded on the exchange is shipped to users in Canada and the U.S. and is priced on TransCanada Corp.’s Alberta system. “When you step back, it was still 97 bcf put into storage when typically we put in about 70 to 75 bcf at this time of year,” Cameron Horwitz , an analyst in Houston at Canaccord Genuity, said in a telephone interview. “There’re still very robust injections and that’s a reflection of what continues to be an oversupply condition in this market.” Gas for November delivery on the New York Mercantile Exchange rose 2.8 cents to settle at $3.598 per million Btu. Gas Prices Gas at the Alliance Pipeline delivery point near Chicago dropped 24.49 cents, or 6.6 percent, to $3.4456 per million Btu on the Intercontinental Exchange. Alliance is an express line that can carry about 1.5 billion cubic feet a day to the Midwest from western Canada. At the Kingsgate point on the border of Idaho and British Columbia, gas fell 14.73 cents, or 4.3 percent, to $3.298, according to ICE. At Malin, Oregon , where Canadian gas is traded for California markets, gas declined 16.01 cents, or 4.5 percent, to $3.3874 per million Btu. Volume on TransCanada’s Alberta system, which collects the output of most of the nation’s gas wells, was 16.6 billion cubic feet, 834 million above the target, as of 3 p.m. New York time. Gas was flowing at a daily rate of 2.6 billion cubic feet at Empress, Alberta, where the fuel is transferred to TransCanada’s main line. Gas Flows At McNeil, Saskatchewan, where gas is transferred to the Northern Border Pipeline for shipment to the Chicago area, the daily flow rate was 1.93 billion cubic feet. Available capacity on TransCanada’s British Columbia system at Kingsgate was 583 million cubic feet. The system was forecast to carry 1.51 billion cubic feet today, about 72 percent of its capacity of 2.09 billion. Volume on Spectra Energy ’s system, which gathers the fuel in northeastern British Columbia for delivery to Vancouver and the Pacific Northwest, totaled 2.79 billion cubic feet at 2:05 p.m. Spectra reported low linepack conditions on the Mainline North of the British Columbia system. Shippers were asked to lower accounts toward zero over the next few days because of an Alberta East capacity constraint on Oct. 11, the company said on its website. To contact the reporter on this story: Colin McClelland in Toronto at cmcclelland1@bloomberg.net To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net |
Yankees Turn to Second-Cheapest Player, Ivan Nova, in AL Playoff Decider.The New York Yankees , with a $202 million payroll that’s the highest in Major League Baseball , are counting on their second-lowest-paid player to get into the next round of the postseason. Rookie pitcher Ivan Nova will get the start in tonight’s decisive Game 5 of the American League Division Series against the Detroit Tigers. The winner advances to the AL Championship Series against the Texas Rangers. Nova, a 24-year-old right-hander, is making $432,900 this season, less than 2 percent of the $24.3 million CC Sabathia is hauling in as the Yankees’ No. 1 starter. By comparison, Sabathia was paid an average of almost $740,000 for each of his 33 regular-season starts. “I’ve got the most important game of my life,” Nova said at a news conference. “It’s the time to do what I’ve been doing all year. It’s the time to step up for the team. We continue in the playoffs or we go home.” Nova had a 16-4 record with a 3.70 earned run average in his first full season in the major leagues. He’s won 13 straight decisions, including his Game 1 playoff victory, and emerged as the Yankees’ second-best starter behind Sabathia, a former Cy Young Award winner who went 19-8 with a 3.00 ERA. “I love this kid’s determination to get better, to never go down again, and to win,” said Yankees manager Joe Girardi , who briefly sent Nova down to the minor leagues this season. “That’s what I see from him. He’s a very hard worker and it’s paid off.” Nova’s salary is the second-lowest of any player on the Yankees’ postseason roster, with infielder Eduardo Nunez making about $13,000 less. No. 2 Starter Even so, Nova has moved into a No. 2 starter role that was supposed to be manned by A.J. Burnett , who is being paid $16.5 million this season. Burnett had been relegated to the bullpen after going 11-11 with a 5.15 ERA during the regular season and only started Game 4 against the Tigers because the opening game was suspended by rain. The Yankees beat the Tigers 10-1 in Game 4 behind Burnett to force a decisive fifth game in New York. Visiting teams have won eight of the 14 decisive games since the advent of division series play in 1995, including seven of the past eight. Now the 27-time World Series champions will turn to Nova, whom the Yankees signed out of the Dominican Republic at age 17. Girardi described Nova as “laid back” and “relaxed,” and the rookie’s demeanor on the mound has drawn comparisons to Andy Pettitte , who helped the Yankees win five championships and had a record 19 postseason victories. Talked to Pettitte Nova said he spoke to Pettitte before taking over for Sabathia when Game 1 of the ALDS was suspended by rain after 1 1/2 innings. Nova picked up the win by holding the Tigers to two runs and four hits over 6 1/3 innings. “Who’s got more success than him in the playoffs?” Nova asked. “One thing that he told me is that if you’ve got trouble, keep in mind that one pitch can get you out of the inning.” While Nova didn’t factor in the decision in three of his final four regular-season starts, he hasn’t lost since June 3 against the Los Angeles Angels. Nova will be the first rookie to start a postseason game for the Yankees since Chien-Ming Wang in 2005. “He’s been successful for us all year long and he threw well the first playoff game,” Girardi said. “A lot of times that’s the one you worry about the most.” Nova will be opposed by Doug Fister, who took the Game 1 loss after allowing six runs in 4 2/3 innings after taking over for Justin Verlander. Fister, 27, had gone 8-1 with a 1.79 ERA in 10 starts for the Tigers in August and September after being acquired in a trade with the Seattle Mariners. “This is what baseball is all about,” Tigers manager Jim Leyland told reporters. “We’ve got a fifth game at Yankee stadium. It doesn’t get much better than that.” To contact the reporter on this story: Erik Matuszewski in New York at matuszewski@bloomberg.net To contact the editor responsible for this story: Michael Sillup at msillup@bloomberg.net |
Russia’s Foreign Reserves Tumble $9.2 Billion, Most Since May.Russia ’s international gold and currency reserves declined for a fourth week, plunging $9.2 billion, the most since May, as Bank Rossii bought rubles, stepping up its defense of the currency. The country’s reserves tumbled to a four-month low of $516.8 billion in the week to Sept. 30, the central bank said on its website today. The four-week decline of $26.6 billion is the steepest since January 2009, when Bank Rossii arrested a ruble devaluation. The ruble depreciated 10 percent against the dollar in September. Policy makers in emerging markets are seeking to bolster their currencies as the debt crisis on both sides of the Atlantic drains capital. Concerns that economic growth is slowing have sent commodity prices lower and cut demand for riskier emerging market assets. The stock market in Russia, which depends on oil and natural gas sales for as much as 40 percent of its budget revenue, tumbled 12 percent in September, the worst decline since June 2009. “It’s getting more difficult,” VTB Chairman Andrei Kostin said today in an interview with Bloomberg Television in Moscow. Tapping “liquidity from the market, the financial market, is very difficult for Russian companies and Russian banks” as Bank Rossii takes rubles out of the market. No ‘Severe Squeeze’ The central bank sold about $8 billion to shore up the currency in September, the most since the ruble’s devaluation in January 2009, Chairman Sergey Ignatiev told reporters in Moscow yesterday. The regulator intensified sales on Oct. 4, selling $1.15 billion on the currency market , he said. The problem is “manageable,” with the Finance Ministry providing more than 1 trillion rubles ($31 billion) in auctions to banks, Kostin said. Russia is not facing a “severe squeeze” as it did in 2008, he said. The ruble strengthened 0.4 percent to 32.4395 against the dollar at 1:29 p.m. in Moscow. Bank Rossii’s reserves are likely to rise by the end of the year, central bank First Deputy Chairman Alexei Ulyukayev said today at a VTB-sponsored conference in Moscow. The currency is more likely to strengthen against other currencies than weaken in the near term, he said. |
Rand Rallies a Second Day on U.S. Jobs Optimism, Europe Debt Speculation.The rand strengthened for a second day on bets the European Central Bank may reintroduce loans to banks, boosting appetite for riskier assets. The currency of Africa ’s biggest economy appreciated as much as 1.8 percent to 7.8762 per dollar and traded 0.6 percent up at 7.9705 as of 5:41 p.m. in Johannesburg. ECB President Jean-Claude Trichet , fronting a policy decision for the final time, said the bank will resume covered- bond purchases and reintroduce year-long loans for lenders as the sovereign debt crisis threatens to lock money markets. The ECB will spend 40 billion euros ($53 billion) on covered bonds starting next month and will offer banks two additional unlimited loans of 12- and 13-month durations, Trichet said at a press conference in Berlin today. The bank resisted calls to cut interest rates. “More accommodation from the ECB may have soothed concerns, especially with regard to the global growth outlook,” Michael Keenan , Standard Bank Group Ltd.’s head of currency research, said by phone from Johannesburg. “The lingering debt crisis is not going to turn around quickly. We are going to have this volatility in the dollar-rand as long as there is uncertainty.” ECB officials meeting in Berlin left the benchmark rate at 1.5 percent, as predicted by 41 of 52 economists in a Bloomberg News survey. Five forecast a cut to 1.25 percent and six expected a reduction to 1 percent. With Greece on the brink of default, the ECB is under pressure to step up efforts to stop contagion by shoring up the euro region’s bond markets and helping banks weather the storm. Rates on Hold “The decision to keep rates on hold is disappointing the market,” John Cairns , a currency strategist at Rand Merchant Bank in Johannesburg, said by phone. “Some people had been hoping they would cut even though the consensus was for no move and, combined with a new resolution to deal with the banking sector stress, bring an end to this mounting crisis.” South African government bonds rallied for a third day, with the 13.5 percent securities due 2015 adding 15 cents to 122.739 rand, driving the yield down four basis points to 6.803 percent. The rand has weakened 17 percent this year, the worst performer of more than 20 emerging-market currencies tracked by Bloomberg. To contact the reporter on this story: Stephen Gunnion in Johannesburg at sgunnion@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net |
France Will Double Tax on Sodas, Sugary Drinks, Le Figaro Says.France will double a proposed tax on sugary drinks, including soft drinks, sweetened juices and waters, raising 240 million euros ($320 million), Le Figaro reported today, citing Budget Minister Valerie Pecresse. The additional tax on a 33-centiliter can of soda will be 2 cents rather than 1 cent, costing Coca-Cola Co. (KO) 80 million euros extra, the newspaper said. The tax won’t apply to diet sodas or sugar-free juices, Le Figaro said. To contact the reporter on this story: Heather Smith in Paris at hsmith26@bloomberg.net To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net . |
Norway Sees Structural, Non-Oil Deficit at NK122 Bln, TV2 Says.Norway will report a structural, non- oil deficit of 122 billion kroner in next year’s budget, TV2 reported, citing budget documents that will be presented today. To contact the editor responsible for this story: Jonas Bergman at jbergman@bloomberg.net |
Alstom Accepted as Likely Contractor for Belgrade’s First Subway.Belgrade’s city assembly approved an agreement for Alstom SA (ALO) ’s transport unit to take part in developing a subway in the Serbian capital. The assembly authorized the municipal government to sign a Memorandum of Understanding with Alstom Transport for 15 kilometers (9.3 miles) of tracks, including seven kilometers underground, based on a feasibility study by Egis Rail. Alstom is “ready to provide all the technical support” during the feasibility period and expects to eventually win the contract, Miodrag Jelisavcic, Alstom’s representative in Serbia, said in a phone interview. The project is part of a “strategic partnership” signed in April between French President Nicholas Sarkozy and Boris Tadic, the president of the former Yugoslav republic that wants to win European Union candidacy status as early as this year. Among financing options for the subway plan, France would help secure the financing and Alstom may choose a subcontractor for digging tunnels, building platforms and train stops. Serbian Deputy Premier Bozidar Djelic estimated Alstom Transport’s part of the contract would be worth 1 billion euros ($1.34 billion) following his trip to France. Today’s document doesn’t specify the value. Another co-financing plan have Serbian find funds for the construction part of the project and Alstom provide trains and rail equipment. A third option is a public-private partnership, in which Alstom would become a concessionaire for the future subway. France pledged support of 3 million euros for the feasibility study and the designs. ‘Sufficient’ Finance Capacity The study and the design for the first subway line are set to be completed by the end of 2012, followed by a financing agreement. Serbia then has two years to negotiate a binding contract with Alstom, without seeking another company for the job. The first line may open as early as 2017. The city has “sufficient capacity” to support the subway development “because our level of debt is not big and we can service loans that we take,” Mayor Dragan Djilas said today at an assembly session at city hall. Serbia’s parliament has yet to ratify the Strategic Partnership Agreement, which France has done. To contact the reporter on this story: Misha Savic in Belgrade at msavic2@bloomberg.net To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net |
ECB Holds Rate at 1.5% at Trichet’s Final Meeting.The European Central Bank resisted calls to cut interest rates at President Jean-Claude Trichet’s final policy meeting today and may opt to use other tools to stem the sovereign debt crisis. ECB officials meeting in Berlin left the benchmark rate at 1.5 percent, as predicted by 41 of 52 economists in a Bloomberg News survey. Five forecast a cut to 1.25 percent and six expected a reduction to 1 percent. With Greece on the brink of default, the ECB is under pressure to step up efforts to stop contagion by shoring up the euro region’s bond markets and helping banks weather the storm. “The earliest the ECB would cut rates would be in December, when it has new economic projections,” Tobias Blattner, a former ECB economist now working for Daiwa International in London , said before the decision. “The ECB needs hold back some firepower and at this meeting will focus on helping the banking sector with extra liquidity.” It has fallen to Trichet to lead the battle against the crisis as lawmakers squabble over their response. His push to resume government bond purchases in August split the ECB’s 23- member Governing Council and led to the resignation of chief economist Juergen Stark. With Trichet’s eight-year term coming to an end on Oct. 31, his final decisions in office may be among the most critical for the future of the euro -- the currency he has championed as a symbol of European unity. ‘Colossal Disaster’ “Trichet holds Europe’s destiny in his hands at this point in time,” said Julian Callow , chief European economist at Barclays Capital in London, who expected a quarter-point rate cut today. “It would be a colossal disaster if we had a prolonged recession in the euro area. Policy makers have to throw the kitchen sink at it to prevent it.” The Bank of England today unexpectedly expanded its bond- purchase program to 275 billion pounds ($421 billion) from 200 billion pounds after keeping its key rate at a record low of 0.5 percent. Trichet holds a press conference at 2:30 p.m. Economists said he may announce the reintroduction of 12-month loans to banks, a measure the ECB last used at the end of 2009. A discussion about reviving the ECB’s covered-bond purchase program to kick-start term funding markets was also on today’s agenda, a euro-area central bank official told Bloomberg News on condition of anonymity. Italian Downgrade Trichet, 68, is stepping down just as Europe’s sovereign debt crisis spills into the financial sector after governments failed to prevent contagion from Greece to the euro area’s core. Market borrowing costs in Italy and Spain , the region’s third and fourth-largest economies, have jumped as investors fret about their public finances. Moody’s Investors Service on Oct. 4 cut Italy’s credit rating for the first time in almost two decades on concern its economic growth may be too weak to enable the reduction of the region’s second-largest debt load. While Trichet has stepped into the breach with ECB bond purchases, he may baulk at some of the proposals governments are considering to beef up their rescue fund, the European Financial Stability Facility. ‘Not in Favor’ One idea is to grant the EFSF a banking license so that it can borrow from the ECB to fund purchases of government bonds. Bundesbank President Jens Weidmann has said that would amount to printing money to fund distressed euro-area nations, and Trichet told lawmakers in Brussels on Oct. 4 that he’s “not in favor” of the plan. Andrew Bosomworth , executive vice-president and senior portfolio manager at Pacific Investment Management Company in Munich, said the ECB should drop its resistance to a Greek debt restructuring. Trichet has insisted that any private-sector involvement in a restructuring must be voluntary. “By failing to cleanse the banking system of unrealized losses, the ECB is leading Europe down the same path as Japan ’s lost decade of growth,” Bosomworth said. Growth slowed to 0.2 percent in the second quarter from 0.8 percent in the first. The ECB last month cut its growth forecasts to 1.6 percent from 1.9 percent for 2011 and to 1.3 percent from 1.7 percent for 2012. At the same time, inflation in the 17-nation euro region unexpectedly accelerated to 3 percent in September, the fastest pace in three years and well above the ECB’s 2 percent limit. Trichet told European parliamentarians on Oct. 4 it’s “sometimes forgotten” that the bank’s primary objective is to “maintain price stability .” To contact the reporters on this story: Jana Randow in Frankfurt at jrandow@bloomberg.net ; Gabi Thesing in London at gthesing@bloomberg.net. To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net |
JM Technology Announces Planned FY Group Dividend of 1000.00 Yen.JM Technology Inc (2423) (2423) announced full-year group dividend estimates for the period to Feb. 29. Figures are in yen. ================================================================================ Forecast Previous Dividend ================================================================================ Full-Year Dividend 1000.00 1000.00 1st-Half Dividend N/A 0.00 2nd-Half Dividend 1000.00 1000.00 ================================================================================ To contact the editor responsible for this story: Teo Chian Wei at +81-3-3201-3623 or cwteo@bloomberg.net |
Agile Leads Gain in Developers in Hong Kong on ‘Emerging’ Investment Value.Agile Property Holdings Ltd. (3383) led gains in Hong Kong-listed Chinese property stocks after Deutsche Bank AG said it sees “emerging” value for long-term investment in the developers. Agile surged by a record 20 percent to HK$5.28 at the close in Hong Kong trading. China Overseas Land & Investment Ltd. (688) , the biggest Chinese developer listed in Hong Kong, climbed 17 percent, and Longfor Properties Co. gained 11 percent. Chinese developers’ shares had plummeted as the country expands its property control measures, raising down-payment requirements and mortgage rates this year to ease gains in home prices. The government said in July it will rein in prices in smaller cities after limiting home purchases in markets such as Beijing and Shanghai. “After the recent sell-offs, we see value emerging for a longer-term investment,” Tony Tsang and Jason Ching, analysts at Deutsche Bank, wrote in a note to client yesterday. “We recommend picking up the high-quality developers with a strong financing capacity.” Half of the 10 biggest decliners in the past month on the MSCI China (MXCN) Index, made up mostly of Chinese companies traded in Hong Kong, were property-related companies including Agile. ‘Increasingly Severe’ Chinese developers face an “increasingly severe” credit outlook, which may force them to cut prices and turn to costlier funding as sales weaken, Standard & Poor’s said on Sept. 27. A 30 percent decline in sales may leave many developers facing a liquidity squeeze, S&P said after conducting stress tests of the nation’s real estate companies. Fewer than half of the 70 cities monitored by the government in August posted month-on-month gains in home prices for the first time, according to Samsung Securities Co. The banking regulator is also looking into financing of developers through trust companies as part of a broader evaluation of loans, a person familiar with the matter said two weeks ago. Guangzhou R&F Properties Co. rose 7.4 percent and China Resources Land Ltd. (1109) was 10 percent higher. The benchmark Hang Seng Index increased 5.7 percent. To contact the reporter on this story: Marco Lui in Hong Kong at mlui11@bloomberg.net To contact the editor responsible for this story: Andreea Papuc at apapuc1@bloomberg.net |
Dubai’s DP World Arranges Financing For London Gateway Project.DP World Ltd. (DPW) , Dubai’s state- controlled port operator, has agreed on a 20-year financing with a group of international banks to fund its London Gateway deep- sea port. The company, which said it will invest an additional $1 billion on the project over the next three years, will use an equal mix of debt and equity to finance the project and plans to draw down on the debt by mid-2012 after completing equity investments, DP World said in an investor presentation posted on its website. DP World, the world’s fourth-largest port operator, revised its group capital expenditure for 2010-2012 to $2.7 billion including the additional London Gateway investment, it said. A further $600 million will be included in group capital expenditure for London Gateway, split between 2013 and 2014 with the majority coming in 2013, according to the presentation. The company said on Oct. 4 that the port, on the Thames river about 25 miles (40 kilometers) east of London and adjacent to a logistics park, will begin operating by the fourth quarter of 2013 and will have capacity for 1.6 million 20-foot containers. To contact the reporter on this story: Arif Sharif in Dubai at asharif2@bloomberg.net To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net |
Dutch Average House Prices Falls 1.1 Percent From Year Earlier.Dutch average house prices fell 1.1 percent in the third quarter from a year earlier, Dutch realtors association NVM said today in a statement on its website. NVM said third-quarter house sales rose 4 percent from the same period a year earlier. NVM had forecast an increase of 10 percent after the government cut a transaction tax to 2 percent from 6 percent. To contact the editor responsible for this story: Fred Pals at fpals@bloomberg.net |
Geithner Says European Debt Crisis Poses Significant Risk.U.S. Treasury Secretary Timothy F. Geithner said the debt crisis in Europe poses a “significant risk to global recovery” and it is critical that governments and financial institutions have a “powerful financial backstop.” “Our direct financial exposure to those governments and their financial institutions is quite small, but Europe is so large and so closely integrated with the U.S. and world economies that a severe crisis in Europe could cause significant damage by undermining confidence and weakening demand,” Geithner said in testimony before the Senate Banking Committee. He assured lawmakers today that there is “absolutely” no chance of another U.S. financial institution collapsing like Lehman Brothers Holdings Inc. in 2008. Geithner testified before the Senate Banking Committee and the House Financial Services Committee on the Financial Stability Oversight Council’s previously released annual report. “If the annual report is an accurate representation of the Council’s progress, I remain as skeptical of its chances of success as I was when my friends on the other side of the aisle proposed its creation,” said Senate Banking Committee ranking Republican member Richard Shelby of Alabama. More Guidance The FSOC meets on Oct. 11, when Geithner said it will provide more guidance to the market on the designation of systemically significant non-bank institutions. Geithner also said the Federal Housing Finance Agency will provide more clarity in the next few weeks on a plan to encourage mortgage refinancing. He said the housing market remains “terrible” and will take years to fix. The foreclosure process is “essentially broken” and the housing servicing framework “is not doing a good enough job of helping people stay in their home or transition to other forms of housing,” Geithner said. The government needs “to help people refinance, even people under water” on their homes and help change empty properties into rental housing, he said. He said Treasury doesn’t have the “power to compel” the largest parts of the mortgage market to act more on principal reduction. The Federal Housing Administration “is prohibited by law and Fannie and Freddie -- we can’t compel them to do it -- have been unwilling to move in that direction to support targeted principal reduction where it makes sense, but we’ve been supportive of it,” Geithner said. Penalize China He said Congress needs to address whether a bill that would penalize China for the value of its currency violates international agreements. “If this bill were to advance, then Congress would, or should, address the concerns that have been raised about the consistency of some provisions with our international commitments,” Geithner told the House Financial Services Committee in a second round of testimony today. The Senate today advanced legislation letting U.S. companies seek duties to compensate for a Chinese yuan that lawmakers say is undervalued. The senators approved by 62-38 a motion limiting debate on the bill backed by Democrats such as Senators Sherrod Brown of Ohio and Charles Schumer of New York and Republicans including Lindsey Graham of South Carolina and Jeff Sessions of Alabama. The legislation, opposed by business groups such as the U.S. Chamber of Commerce, may stall in the House. Republican Speaker John Boehner of Ohio said today that the bill could start a trade war. Jobs Plan President Barack Obama’s $447 billion jobs plan would put “more resources into neighborhoods most affected by the foreclosure crisis,” Geithner said. “That’s expensive, but we can afford it, and it’s a good use of scarce resources.” Geithner said the biggest risk to the U.S. economy is “institutions not taking enough risk. “You need to make sure that people are willing to take risks,” Geithner said. “You don’t want to lose that capacity.” House Financial Services Committee Chairman Spencer Bachus , a Republican from Alabama , said based on that quote he’s not sure Geithner has “a clear picture of reality.” “If in fact you are correct and banks are not taking enough risks, I would submit to you the problem doesn’t lie with the loan officers in the community and regional banks; it lies in the regulatory approach of the very members of the FSOC,” Bachus said. The banking committee also approved the Obama administration’s nomination of Cyrus Amir-Mokri as Treasury assistant secretary for financial institutions. Amir-Mokri’s nomination still must be approved by the full Senate. He would replace Michael Barr , who left the Treasury in December 2010. To contact the reporters on this story: Cheyenne Hopkins at Chopkins19@bloomberg.net ; Ian Katz in Washington at Ikatz2@bloomberg.net To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net |
Pound Weakens Against Dollar as Bank of England Adds Stimulus to Economy.The pound tumbled against the dollar and the euro after the Bank of England unexpectedly added stimulus to revive the economy. Sterling slid 0.9 percent to $1.5326 as of 12:02 p.m. in London , and weakened 0.8 percent to 87 pence per euro. Policy makers will increase their bond-purchase program by 75 billion pounds. The median forecast of economists surveyed by Bloomberg predicted no change. To contact the reporter on this story: Paul Dobson in London at pdobson2@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net |
Venture Firms Reduce Biotechnology Investment on FDA Risk.Venture capital firms are investing less in experimental drugmakers and medical device makers because of what they say are regulatory hurdles, a survey found. Almost 40 percent of 150 venture capital firms that responded to the survey have decreased their investment in life sciences during the past three years, the National Venture Capital Association said today in a statement. The same proportion expect to continue to reduce their spending on these companies over the next three years, a potential $500 million loss, the association said. “The process has gotten to be so long, and the capital required so deep, that it’s becoming more and more difficult to generate venture-type returns and therefore make it worth your while to do it,” said Terry McGuire, co-founder and general partner of Polaris Venture Partners and past chairman of the association, in an interview. Venture firms have shifted their investments overseas, where McGuire says regulatory approvals come quicker. More than one-third of survey respondents said they would increase their spending in Europe and 44 percent in Asia, compared with 13 percent saying the same for North America. The U.S. Food and Drug Administration is taking steps to address some of the industry’s concerns, Commissioner Margaret Hamburg said yesterday in a statement. The agency plans to streamline regulations and speed up the approval process for some drugs, among other changes. The agency approved 25 new drugs as of Sept. 15 and at that pace, by year’s end, would clear the most new drugs in since 2004, according to Bloomberg data. To contact the reporter on this story: Ryan Flinn in San Francisco at rflinn@bloomberg.net To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net |
Primary Says Bateman Affirmed Remaining as CEO Further 3 Years.Primarty Health Ltd. said Chief Executive Officer Edmund Bateman has affirmed he intends to remain in the role for a further three years, according to a regulatory filing. To contact the reporter on this story: Tim Smith in Sydney at tsmith58@bloomberg.net To contact the editor responsible for this story: Tim Smith at tsmith58@bloomberg.net |
Crude Oil Falls in New York on Renewed Growth Concern After Two-Day Rally.Oil fell in New York on speculation the biggest two-day rally in seven months was exaggerated amid U.S. unemployment and signs of slowing global demand for crude. Futures slipped as much as 0.6 percent, paring the first weekly increase in three. OPEC will keep shipment levels unchanged through most of this month as the economic slump constrains demand, tanker-tracker Oil Movements said. The jobless rate in the U.S., the world’s biggest crude user, held at 9.1 percent for a third month in September, a Labor Department report may show today. A technical indicator signaled oil-price rises aren’t justified by buying momentum. “Payroll data tonight is going to be really important,” Jonathan Barratt , a managing director of Commodity Broking Services Pty in Sydney, said by telephone today. “That’ll dictate the move.” Crude for November delivery dropped as much as 47 cents to $82.15 a barrel in electronic trading on the New York Mercantile Exchange and was at $82.26 at 12:42 a.m. Sydney time. The contract yesterday climbed $2.91 to $82.59, for a two-day gain of 9.1 percent, the biggest since Feb. 22-23. Prices are up 3.9 percent this week and down 10 percent this year. Brent oil for November settlement was at $105.29 a barrel, down 44 cents, on the London-based ICE Futures Europe exchange. The European benchmark contract was at a premium of $23.03 to New York crude, compared with a record of $26.87 on Sept. 6. OPEC Exports New York crude’s moving average convergence-divergence, an indicator of trading momentum, remained below zero on the weekly chart even as prices increased, according to data compiled by Bloomberg. Investors typically look for positive momentum to sustain buying of contracts. The Organization of Petroleum Exporting Countries will export about 22.72 million barrels a day in the four weeks to Oct. 22, little changed from the 22.74 million a day shipped in the month to Sept. 24, Halifax, England-based Oil Movements said yesterday in a report. Shipments typically rise at this time of year as refiners prepare to boost production of winter fuels. The figures exclude Ecuador and Angola. U.S. employment increased by 55,000 workers last month, according to economists surveyed by Bloomberg News before today’s report. The jobless rate has been at 9 percent or higher since April. Oil surged yesterday after the European Central Bank President Jean-Claude Trichet announced a bond-purchase program to tame the region’s debt crisis, while the Bank of England unexpectedly expanded its bond-purchase program in the first loosening of U.K. monetary policy since 2009. To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net To contact the editor responsible for this story: Paul Gordon in Hong Kong at pgordon6@bloomberg.net |
Pickles Corp Announces Planned FY Group Dividend of 10.00 Yen.Pickles Corp (2925) (2925) announced full-year group dividend estimates for the period to Feb. 29. Figures are in yen. ================================================================================ Forecast Previous Dividend ================================================================================ Full-Year Dividend 10.00 10.00 1st-Half Dividend N/A 0.00 2nd-Half Dividend 10.00 10.00 ================================================================================ To contact the editor responsible for this story: Teo Chian Wei at +81-3-3201-3623 or cwteo@bloomberg.net |
Airlines May Lose Fight Over EU CO2 Caps.International airlines should lose a challenge to the European Union’s planned expansion of its carbon cap-and-trade system beyond the bloc’s borders, an adviser to the region’s top court said. “The inclusion of international aviation in the EU emissions trading scheme is compatible with international law,” Advocate General Juliane Kokott of the EU Court of Justice in Luxembourg said in a non-binding opinion today. The court follows this advice at least in part most of the time. United Continental Holdings Inc. (UAL) , AMR Corp. (AMR) ’s American Airlines and the Air Transport Association of America challenged the EU’s first attempt to extend the world’s largest carbon cap- and-trade program beyond its borders. The EU regulator last month said it won’t ditch its plans to impose carbon curbs on flights to and from the region’s airports starting next year. EU emissions permits for December rose as much as 2 percent to 10.44 euros ($13.94) on the news. At a court hearing in July the airlines said the EU plans to extend the EU carbon market to all flights that depart from or arrive at an airport in the region are unlawful. The advice by Juliane Kokott, one of eight advocates general at the EU court, gives an indication of which way the tribunal may rule. ‘Very Good Indication’ EU Climate Commissioner Connie Hedegaard in an interview during a visit to New York last month said while the regulator doesn’t want to “dictate the world what to do,” aviation can’t be excluded forever. “Generally ECJ opinions are very good indication of the final outcome,” said Isabelle Curien, a Paris-based carbon analyst at Deutsche Bank AG. “It’d be very good for the market if the court supported the commission and its credibility. But if the opinion cast additional doubts it would weigh on the market and the moment is not good for that as prices are already low on other concerns.” The EU decided in 2008 that aviation should become a part of its carbon cap-and-trade program. “We did that because for many, many years we, more than anyone, fought hard to get an international agreement on aviation; unfortunately without success,” Hedegaard said. “We’re already asking contributions from our power sector, from other industries, so we think that while we’re expanding the system in Europe it’s not logical that some of the big sectors where emissions are growing should be exempted.” 3 Percent Emissions from international aviation account for 3 percent of global greenhouse gas discharges and that share is expected to rise, according to the EU. Scientists say pollution must be cut to keep the planet from overheating. The Emissions Trading System, started in 2005, covers more than 11,000 utilities and manufacturers and is the cornerstone of the EU’s climate plan. The EU system is the region’s main tool to reach its target to reduce carbon dioxide by 20 percent in 2020 compared with 1990 levels. The High Court in London referred the case to the EU court last year to clarify the legality of the emissions curbs. The case is: C-366/10 , The Air Transport Association of America, American Airlines , Inc., Continental Airlines, Inc., United Airlines , Inc. v. The Secretary of State for Energy and Climate Change. To contact the reporter on this story: Stephanie Bodoni in Luxembourg at sbodoni@bloomberg.net To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net |
SPAIN DAYBOOK: Treasury Sells Bonds; Industrial Output Data.Spain ’s Treasury aims to sell as much as 4.5 billion euros of debt maturing in 2014 and 2015, while the National Statistics Institute publishes industrial production data. WHAT TO WATCH: *Treasury sells debt, with results due around 10.35 a.m. in Madrid. *People’s Party conference starts in Malaga at 4:30 p.m. and continues through Oct. 8. ECONOMY: *National Statistics Institute publishes data on August industrial production at 9 a.m. CET. EQUITIES: *Banks accounting for 20 percent of the 4.9 billion-euro ($6.5 billion) loan used by Sacyr Vallehermoso SA (SYV) to buy 20 percent of Repsol YPF SA (REP) won’t agree to a rollover, Expansion reported, citing unidentified people close to the matter. MARKETS: *The IBEX 35 Index rose 3.1 percent to 8,477. *The spread between Spanish and German 10-year borrowing costs narrowed to 325 basis points. To contact the editor responsible for this story: Emma Ross-Thomas at erossthomas@bloomberg.net |
Anita Hill, 20 Years On, Seeks Equality: Susan Antilla.(Corrects date and details of a court dismissal in 11th paragraph) Anita Hill sits at a tiny conference table in her office at Brandeis University , just outside Boston , as I quiz her on the obvious themes. Her testimony during hearings to confirm Clarence Thomas to the U.S. Supreme Court? Admittedly a “terrible” experience, “but I want people to understand that I survived it.” Attacks on her character? A good thing for women in the workplace because now “they know what to expect” should they ever go public about harassment. Her sex-harassment claim stirred up the dregs of America. Hill got threats of murder, rape and sodomy on her answering machine. David Brock, a best-selling author , declared her to be “a little bit nutty and a little bit slutty,” only to recant that and other attacks years later. Yet Hill shows no bitterness, and exploits no opportunities to take a swipe at any of the people who turned her harassment complaint into a reason to assail her. And today, she has a new cause. In a book released this week, “Reimagining Equality: Stories of Gender, Race, and Finding Home,” Hill says women, particularly single heads of households, face a new setback: Just as they were gaining social and economic independence by purchasing homes in increasing numbers, they were upended by the crash in housing prices. Young women entering the workforce for the first time may not even know her name, says Joan C. Williams, distinguished professor of law at the University of California Hastings College of Law in San Francisco. “But Anita Hill shaped their lives in ways they don’t understand.” Coke Can Incident It was just shy of 20 years ago, on Oct. 11, 1991, when Hill riveted American television viewers and set off battles of the sexes at many a company water cooler. Then a law professor at the University of Oklahoma , she had worked for Thomas at the U.S. Department of Education and the Equal Employment Opportunity Commission. She alleged before the Senate Judiciary Committee that Thomas had spoken to her about explicit sex videos he had watched, and once asked in her presence while at work, “Who has put pubic hair on my Coke?” At the hearings, and 16 years later in his autobiography, Thomas denied her accusations. Let me say upfront that I have concluded over the years that Hill, not Thomas, was the credible one in this sorry tale. I base that opinion, above all, on the work of journalists Jane Mayer and Jill Abramson, whose 1994 book, “Strange Justice,” offered extensive support for Hill’s accusations, including on- the-record comments from Thomas’s former classmates, who found Hill’s description of the sexual banter to be in sync with the man they knew. Mayer writes for the New Yorker. Abramson last month became executive editor of the New York Times. Kathy Arberg, a spokeswoman for the Supreme Court, said Thomas declined to comment for this article. Touched a Nerve You may not agree with my take on what happened between the man who now sits on the Supreme Court -- ruling this year against women in a historic sex-discrimination case , no less, involving Wal-Mart Stores Inc. (WMT) -- and the woman who today teaches courses including “Race and the Law” on a bucolic New England campus. But it’s hard to argue against this: Hill’s testimony touched a nerve with working women in America. Even Hill was taken aback. “What then came for me was a surprise, and that is that my testimony started something else. It started individuals talking about sexual harassment; not only were they talking about it in ways they had never talked about it before, but they were talking about it. Just the fact that we were talking about it and we weren’t carrying around this shame about ‘Well, we were not tough enough if we admitted it bothered us.’ That was a change because we were always told ‘Just keep your mouth shut and just suck it up.’” Changed Forever Williams, the law professor, sensed the same historic shift in attitudes. “There was a common understanding that if you couldn’t handle harassment, you were kind of a wimp and probably didn’t deserve the job anyway,” she says. “Then came Anita Hill and all of a sudden there was a whiff of liability, and the cultural environment changed forever.” I read those words to Hill. “You know, I hope it changed forever,” she says. It did. The Civil Rights Act of 1991, which for the first time gave employees filing a federal lawsuit the right to a jury trial and the chance to win damages for emotional distress, was signed into law five weeks after Thomas’s confirmation. Hill initially worried that the raking-over she got from critics would dissuade women from speaking up, but the opposite happened. Her testimony, combined with the new law, led to a surge of complaints, says Elizabeth Grossman, the regional attorney in the New York district office of the EEOC. (In August, a claim alleging a pattern of gender discrimination, part of a lawsuit brought by Grossman’s office against Bloomberg LP, was dismissed in a New York federal court.) “She brought a consciousness to many people and different employers in our society and got people talking about the issues,” Grossman says. Constructive as that outcome was, it wasn’t what motivated Hill to recount so publicly the incidents of a boss who she says asked her out on dates and talked about “very vivid” pornography. It was about “whether Thomas, who was being considered for a lifetime appointment, was fit for the position,” she told me. The Coke-can incident allegedly occurred in the offices of the EEOC, of all places. So the obvious question to Hill was whether a man who hits on a female employee and dishes talk about videos of oversize male sex organs had the appropriate “respect for the law” that a Supreme Court appointment calls for. Would she go through it all again knowing how hard it would be? “Oh yeah, yes,” she says. “The issues to me are so clear. This was about the integrity of the court.” Magnet for Controversy Despite Hill’s claims, Thomas squeaked by and was confirmed by a 52-48 Senate vote. He remains a magnet for controversy. Twenty Democratic House members on Sept. 29 asked the U.S. Judicial Conference, which oversees federal courts, to investigate the fact that he did not disclose almost $700,000 of his wife Virginia Thomas’s income from 2003 to 2007. In a separate public-relations flare-up a year ago, Virginia Thomas delivered this contender for world’s weirdest voice message: On Hill’s phone at Brandeis, she suggested Hill apologize for “what you did with my husband.” Much has gone right for women in the workplace since Hill spoke up. It would be tough to find a large U.S. company today that didn’t train employees on workplace-harassment issues, Grossman says. “It can be window dressing,” she says, but done right, harassment training can help companies decrease turnover rates, build morale and lower absenteeism. There’s also no question that women entering the workplace today have less to fear. ‘Ugly Out There’ Ironically, or some might say predictably, much has also gone dreadfully wrong, thanks to court rulings in which Thomas played a part. “Civil-rights laws are being undermined by the U.S. Supreme Court,” says Cliff Palefsky, a San Francisco-based employment lawyer. “It’s really, really ugly out there.” Two decisions supported by Thomas this year could undo some of the post-Anita Hill progress by stifling the single-most- powerful weapon against workplace discrimination: the class- action lawsuit. The June 20 decision in Wal-Mart v. Dukes torpedoed a class-action discrimination case that would have included 1.5 million women. Employees looking to bring large cases in the future will have a tougher time of it. And an April 27 ruling in a case called AT&T Mobility v. Concepcion said consumers who signed the company’s customer agreement could neither sue individually nor pursue a class- action suit. The fear is that the Concepcion case opens a door for employers to require employees to sign agreements that similarly take away an individual’s right to sue while also shutting down employees’ ability to join co-workers in a class. Vulnerable Time The decisions come at a vulnerable time for women. “I look at the growing number of women who were in the housing market” in the previous decade, Hill says. Buying a home was “not only a statement about their economic independence, but also a statement about their social independence. Because remember, single women weren’t supposed to be homeowners; they were supposed to wait until they were maaaa-rried,” -- she says the word in a sing-songy voice -- “and then they were supposed to have the big house and the children, and women, we were rejecting that, only to get slapped by these, in many cases, toxic loan instruments.” The Consumer Federation of America expressed concern in a 2006 study that a lopsided share of subprime mortgages was going to single women. One in five homebuyers in 2003 was a single female, the study noted, up from one in 10 in 1991. But as women were stepping up their home purchases, they were being steered to mortgages with onerous conditions. Black and Latino women were much more likely to wind up with a subprime mortgage than were white men with similar incomes. Old Problems While women confront these new obstacles, some of them still make the morning commute to jobs where old problems continue. Things are better, but “we’re still bringing the same old sex-harassment cases where the boss is grabbing people’s breasts and rear ends, and threatening to fire them if they don’t submit to advances,” Grossman says. Discouraging? Hill offers some perspective. “I don’t think we’ve gotten it right. As much progress as we’ve made socially, I’m not satisfied that it’s over, that the battle is won and that we can just brush our hands and say ‘lets move on to other issues,’” Hill says. “It’s been 20 years, but what we are talking about is changing centuries of behavior.” ( Susan Antilla , who has written about Wall Street and business for three decades and is the author of “Tales From the Boom-Boom Room,” a book about sexual harassment at financial companies, is a Bloomberg View columnist. The opinions expressed are her own.) To contact the writer of this article: Susan Antilla at santilla@bloomberg.net To contact the editor responsible for this article: Paula Dwyer at pdwyer11@bloomberg.net |
Kenyan Government Expects Shilling to Gain Strength ‘Very Soon’.Kenya ’s government said it expects the shilling to strengthen against the dollar “very soon” after Prime Minister Raila Odinga led efforts to stabilize the currency. Odinga is meeting President Mwai Kibaki today to discuss measures to support the currency, Alfred Mutua , the government’s spokesman, said in a statement on the website of the country’s Office of Public Communications. A further statement is expected to be released later, he said. To contact the reporter on this story: Sarah McGregor in Nairobi at smcgregor5@bloomberg.net To contact the editor responsible for this story: Paul Richardson at pmrichardson@bloomberg.net |
Tact Home Co Ltd 1H Group Net Income Estimate 1.70B Yen 8915 JP.Tact Home Co Ltd (8915) (8915) announced first-half group earnings estimates for the period to Nov. 30. Figures other than earnings per share are in millions of yen. ================================================================================ Operating Current Net Earnings Revenue Profit Profit Income Per Share ================================================================================ First-Half Estimates 32054.00 3084.00 2983.00 1698.00 7174.88 ================================================================================ Page forward for parent information... Parent Information ================================================================================ Operating Current Net Earnings Revenue Profit Profit Income Per Share ================================================================================ ================================================================================ To contact the editor responsible for this story: Teo Chian Wei at +81-3-3201-3623 or cwteo@bloomberg.net |
Fisher Says He Sympathizes With Protests Against Fed, Wall Street Bailouts.Federal Reserve Bank of Dallas President Richard Fisher said protests against Wall Street and the central bank stem from frustration with unemployment, and he sympathizes with the discontent. The U.S. faces stalled job growth, and “too many” of its workers are unemployed, Fisher said in a speech today in Fort Worth , Texas. The policy maker dissented at each of the past two Federal Open Market Committee meetings in August and September, opposing plans to hold rates low until at least mid-2013 and to swap short-term securities in the Fed’s portfolio with longer- term debt. “I’m somewhat sympathetic” to the demonstrations, Fisher said. “We have too many people out of work. We have very uneven distribution of income.” Demonstrators from New York City to San Francisco took to the streets to protest what they call a growing wealth disparity between large U.S. corporations and average citizens in the wake of the financial crisis. Picketers marched in San Francisco yesterday as part of the Occupy Wall Street movement that began three weeks ago in lower Manhattan and has spread to cities from Dallas to San Francisco. The jobless rate in August was 9.1 percent. Employers that month added zero jobs to payrolls, down from 85,000 in July, according to the Labor Department. “We have a very frustrated people and I can understand their frustration,” Fisher said. He reiterated his view that the Fed “can’t do everything” to cure what ails the economy and there’s “a danger if we go too far.” ‘Exceptional’ Texas Fisher, 62, spoke on the topic of “Texas: What Makes Us Exceptional; What Makes Us Vulnerable?” at the Texas Economic Development Council’s 2011 Annual Conference and 50th Anniversary Celebration. The U.S. has become a “national economic desert devoid of job creation ,” with Texas providing an “oasis,” Fisher said. A key to the state’s success “lies in its ability to change and adapt” to a rapidly globalized economy, and job growth should continue at “a moderate pace,” Fisher said. Texas had an 8.5 percent jobless rate in August. While the state benefits from high commodity prices, it “continues to be handicapped by low levels of construction activity and moderate gains in consumer spending and demand,” he said. Fisher’s Dissent Fisher dissented at the FOMC’s Sept. 20-21 meeting against the group’s decision to push down longer-term interest rates , saying he did not prefer to undertake further easing, according to an FOMC statement. He also challenged the committee’s Aug. 9 pledge to keep the benchmark U.S. interest rate low through at least mid-2013, preferring instead to maintain a previous commitment to do so for “an extended period.” President Barack Obama , appearing at a White House news conference today, said the anti-Wall Street protesters are “giving voice” to wider frustration with the U.S. financial system. “The American people understand that not everybody’s been following the rules, that Wall Street is an example of that,” he said, while stopping short of endorsing the demonstrations. The protests are a result of “broad-based” dissatisfaction growing out of the financial crisis. To contact the reporter on this story: Vivien Lou Chen in San Francisco at vchen1@bloomberg.net ; To contact the editor responsible for this story: Chris Wellisz at cwellisz@bloomberg.net |
Peru Sol Has Biggest Two-Day Rise in Four Months on ECB Move.Peru’s sol posted its biggest two-day gain in more than four months as moves by the European Central Bank to shore up the euro region’s money market spurred demand for higher-yielding, emerging-market assets. The sol strengthened 0.5 percent to 2.7495 per U.S. dollar , from 2.7630 yesterday. That brought its advance over the past two days to 1 percent, the most since May 12-13. The ECB will start buying covered bonds and offer banks two additional unlimited loans, ECB President Jean-Claude Trichet said today after policy makers left the benchmark interest rate at 1.5 percent. Federal Reserve Chairman Ben S. Bernanke on Oct. 4 signaled he’ll push forward with further expansion of monetary stimulus if needed to boost U.S. growth. “Overseas investors are buying soles again as international markets are calmer,” said Mario Guerrero , an economist at Scotiabank Peru in Lima. Peruvian banks may seek to reduce their “heavy” dollar holdings as the sol strengthens, Guerrero said. Peruvian banks’ net dollar holdings, including forward contract obligations, totaled $425 million on Oct. 4, according to the central bank. The banks had a negative dollar position a month earlier. The Andean nation’s central bank will probably leave its benchmark rate at 4.25 percent for a fifth month today, according to 17 of 18 analysts surveyed by Bloomberg. The bank will announce its decision at about 7 p.m. New York time. The central bank didn’t buy or sell dollars in the foreign exchange market today. The yield on the nation’s benchmark 7.84 percent sol- denominated bond due August 2020 dropped 10 basis points, or 0.1 percentage point, to 5.81 percent, according to prices compiled by Bloomberg. To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net |
Chile’s Cruz Blanca Salud Registers Peru Health Services Unit.Cruz Blanca Salud SA, Chile ’s second- largest health services provider, registered a unit in Peru as part of an international expansion plan, according to a statement posted on the website of Chile’s securities regulator. To contact the reporter on this story: Eduardo Thomson in Santiago at ethomson1@bloomberg.net To contact the editor responsible for this story: James Attwood at jattwood3@bloomberg.net |
Soros Says Euro Needs Own Finance Ministry, Handelsblatt Reports.The euro-area countries should move without delay toward establishing a joint finance ministry to gain control over the debt crisis, according to billionaire investor George Soros, Handelsblatt reported. Soros told the newspaper the European Central Bank should give major banks in the euro area temporary guarantees and permanent recapitalization funds. The ECB should also allow countries including Italy and Spain to refinance their debts at lower interest rates , Handelsblatt cited him as saying. To contact the reporter on this story: Jeff Black in Frankfurt jblack25@bloomberg.net To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net |
Energy Dept. Loan Director Leaving After Solyndra.Jonathan Silver, executive director of the U.S. program that awarded Solyndra LLC a $535 million federal loan guarantee, is leaving, the Energy Department said. While Silver joined the Energy Department after the solar panel maker received its loan, Representative Cliff Stearns , a Florida Republican and chairman of the House panel investigating the award, has said he should be fired for his handling of the loan since arriving. Silver, 54, led the loan office as Solyndra’s financial condition worsened, culminating in the department’s agreement in January to let taxpayer support take a back seat to funds from fresh investors in a last-ditch effort to rescue the company. “Jonathan assembled and managed a truly outstanding team that has transformed the program into the world leader in financing innovative clean-energy projects,” Energy Secretary Steven Chu said today in a statement. Chu said Silver told him in July of his intention to leave after the end of the fiscal year on Sept. 30, when the loan program would have “no significant funds.” The energy secretary, who has been criticized for the Solyndra loan, said he had “absolute confidence” in Silver and wanted him to stay. Silver is leaving to become a distinguished visiting fellow at The Third Way, a Washington-based think tank that says it promotes moderate policies. Second Application Solyndra filed for bankruptcy protection Sept. 6 and had its Fremont, California, offices raided by the FBI two days later. The company applied for a $469 million U.S. loan guarantee a week after winning the first loan in September 2009, according to a filing to the U.S. Securities and Exchange Commission three months later. The second guarantee would have helped finance an expansion of a factory the company hadn’t yet built. Chu said today that the second application “was not ever in serious contention.” To contact the reporter on this story: Jim Snyder in Washington at jsnyder24@bloomberg.net To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net |
MetLife Has Charge of Up to $135 Million on Death Benefits.MetLife Inc. (MET) , the largest U.S. life insurer, said it will take a charge of $115 million to $135 million for the third quarter to adjust reserves as it uses additional data to identify cases where it hadn’t paid claims. The review involves the use of Social Security Administration death records, the New York-based insurer said today in a regulatory filing. MetLife and smaller rivals have been pressed by regulators to move more swiftly to identify dead policyholders. The insurance departments in Florida and California have investigated whether life insurers failed to pay benefits. The firms are generally required to pay claims after being notified of a policyholder’s death and receiving a valid death certificate. MetLife is using Social Security data “to identify certain group life insurance certificates, individual life insurance policies and other contracts where the covered person may be deceased, but a claim has not yet been presented to the company,” the insurer said in the filing. Third-quarter results include $80 million to $100 million in catastrophe losses, and the company will take a charge of about $40 million related to supporting policyholders of Executive Life Insurance Company of New York. Regulators turned to healthy insurers to help fund Executive Life’s obligations after it was put into rehabilitation about 20 years ago. To contact the reporter on this story: Andrew Frye in New York at afrye@bloomberg.net To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net |
Apple Looks to Overseas Growth to Stay on Top Without Jobs: Tech.Steve Jobs built Apple Inc. into the world’s most valuable technology company with easy-to-use products that transformed the computing, wireless and music industries. The company will look for overseas growth to extend that legacy and remain an investor favorite. Apple, which said its visionary founder died yesterday at 56, aims to maintain its expansion in markets such as China , fueling sales of the iPhone and iPad. The company also stands to gain from updated versions of those best-sellers and the new iCloud service, which makes it easier for its gadgets to share information -- and harder for users to switch to rival devices. For Chief Executive Officer Tim Cook , the challenge will be developing Apple’s next generation of hot sellers and facing down competition in the markets Jobs pioneered. Google Inc.’s Android has emerged as one of Apple’s biggest threats after gaining momentum in phones and tablets. Cook, who this week led the debut of the iPhone 4S, will lean on a cadre of fellow veteran executives who have long worked together under Jobs. “He created an infrastructure that this management team can build on for a long time,” said Tim Bajarin , a technology analyst at Creative Strategies Inc. “The bigger question is how fast will they innovate and take advantage of that infrastructure for things like new devices, applications and services.” Jobs had resigned as Apple Inc. (AAPL) chief executive officer on Aug. 24. He was diagnosed in 2003 with a neuroendocrine tumor, a rare form of pancreatic cancer, and had a liver transplant in 2009. Apple Investors Investors have had mixed reactions since Jobs stepped down as CEO. The shares rose more than 7 percent in the month after he resigned, and have since slipped back to little changed. The stock fell 88 cents to $377.37 at 4 p.m. New York time on the Nasdaq Stock Market. The shares are recommended by 49 analysts, with no sell ratings, according to Bloomberg data. On average, analysts predict the shares will rise another 32 percent to $499.40. “Steve Jobs has set up the company for the next few years to have some more blockbuster products,” said Giri Cherukuri , an Apple investor with Oakbrook Investments who has been following the company since the late 1980s. Updated models of the iPhone and iPad, as well as potential new products like a television, will keep the company growing, he said. ‘Final Great Act’ Apple’s stock price has risen more than 9,000 percent since Jobs returned to the company in 1997. The stock has more than doubled in the past two years, while Microsoft Corp. (MSFT) has gained 5.1 percent and Intel Corp. (INTC) has risen 14 percent. Hewlett- Packard Co. is down 48 percent. While analysts once predicted that Apple shares would plunge when Jobs left the company, investors have grown more comfortable with other executives since he first went on medical leave in 2004. In 2008, Piper Jaffray Cos. analyst Gene Munster estimated that Apple shares would tumble 25 percent if Jobs departed. Munster, who now has a target price of $607 for the stock, said Jobs’s “final great act” was grooming Cook as a successor. Apple benefited from record purchases of iPads and iPhones in the quarter that ended in June, helping profit more than double to $7.31 billion. Sales climbed 82 percent $28.6 billion. “For now, people are comfortable, but that could change if there are signs to the contrary,” said Mike Abramsky , an analyst at RBC Capital Markets in Toronto. Cook’s Team In addition to Cook, Apple’s executive team includes Jonathan Ive, senior vice president of industrial design; Scott Forstall , who is in charge of the iOS software that powers the iPhone and iPad; and Philip Schiller, who leads product marketing. Additionally, Bob Mansfield heads Mac hardware engineering; Eddy Cue runs iTunes, the App Store and iCloud; Bruce Sewell is chief counsel, putting him at the helm of the company’s patent disputes; and Chief Financial Officer Peter Oppenheimer is tasked with overseeing Apple’s more than $75 billion in cash and long-term holdings. While Apple has turned its website into a memorial to Jobs and is flying the flags at its Cupertino, California, headquarters at half-mast, the company will quickly have to shift its focus back to the looming release of the iPhone 4S. The device, unveiled Oct. 4, goes on sale Oct. 14. Nokia, RIM The iPhone helped Apple upend the mobile-phone industry, increasing the popularity of touch-screen devices. That came at the expense of Nokia Oyj and Research In Motion Ltd. (RIMM) , which have lost market share and shed workers. As Apple’s sales and profit grew, its market value soared past rival technology companies. Its valuation now exceeds the combined worth of Microsoft and Intel, two companies that once pushed Apple to the fringes of the personal-computer industry. To stay on top, Apple will have to maintain its expansion in China, where the company generated about $3.8 billion in the most recent quarter, up more than sixfold from a year earlier. The company’s retail outlet in Shanghai had 100,000 visitors on its opening weekend, Cook said at the iPhone 4S event. Apple is opening its first store in Hong Kong this year. The new version of the iPhone, Apple’s top money-maker, will face competition from Samsung Electronics Co., Motorola Mobility Holdings Inc. and HTC Corp., which use Android software in their smartphones. New Products Apple’s ICloud, which lets customers access pictures, music and other information across a broad range of its devices, will be released on Oct. 12. The service was first showcased at Jobs’s last public appearance, Apple’s developer conference in June. When Apple needs to introduce entirely new products, Jobs’s vision may be missed -- if the company introduces a TV, for example, Piper Jaffray’s Munster said. Jobs was critical in hiring and pushing the company into new areas, Abramsky said. He was vital in negotiations with media companies for securing content such as music and movies that are sold through iTunes. “There’s a certain unknown about how Apple will be different,” Abramsky said. To contact the reporter on this story: Adam Satariano in San Francisco at asatariano1@bloomberg.net To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net |
U.S. Crude Premiums Weaken as WTI-Brent Spread Little Changed.U.S. Gulf crude premiums weakened after the discount for West Texas Intermediate versus Brent was little changed. The gap between WTI and Brent November contracts increased 9 cents to settle at $23.14 a barrel in New York. The spread settled Sept. 6 at a record margin of $26.87. When Brent increases versus WTI, it strengthens the value of low-sulfur U.S. grades that compete with West African oil priced against the European benchmark. Heavy Louisiana Sweet’s premium to WTI narrowed 45 cents to $26.50 a barrel at 2:57 p.m. in New York, according to data compiled by Bloomberg. Light Louisiana Sweet’s premium lost 35 cents to $26. Among sour, or high-sulfur, grades, the premium for Mars Blend decreased 65 cents to $22.75 a barrel while Poseidon weakened 15 cents to $22.50 a barrel over WTI. Southern Green Canyon’s premium narrowed 80 cents to $21.45 a barrel and West Texas Sour’s discount was unchanged at 90 cents a barrel below WTI. Thunder Horse’s premium decreased 65 cents to $26.10 above the benchmark. The premium for Syncrude was unchanged at $10 a barrel. Syncrude is a light, low-sulfur synthetic oil derived from the tar sands in Alberta. The discount for Western Canada Select was unchanged at $9.50 a barrel. To contact the reporter on this story: Aaron Clark in New York at aclark27@bloomberg.net To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net |
Megaworld, Philippine Builders Rise on Office Rental Rate Gain.Megaworld Corp. (MEG) climbed, leading an advance among Philippine property developers, after the Philippine Daily Inquirer reported that office rental rates in Manila rose in the second quarter. Megaworld, which builds offices for call centers, advanced 3.9 percent to 1.60 pesos at 10:16 a.m. in Manila, the first gain in four days. Ayala Land Inc., the nation’s largest developer, climbed 1 percent to 14.20 pesos. Filinvest Land Inc. rose 1.9 percent to 1.07 pesos, set for the sharpest gain since Sept. 28. Office rentals rose, driven by demand from providers of outsourced business services, the Inquirer reported, citing Rick Santos, chief executive at CB Richard Ellis Philippines. To contact the reporter on this story: Ian Sayson in Manila at isayson@bloomberg.net To contact the editor responsible for this story: Matthew Oakley at moakley@bloomberg.net |
Spain Industrial Output Rises for First Time in Six Months.Spanish industrial production unexpectedly rose for the first time in six months in August, backing up a prediction by Finance Minister Elena Salgado that Spain won’t relapse into a recession. Output at factories, refineries and mines adjusted for the number of working days increased 0.3 percent from a year earlier, after a revised 2.3 percent in July, the National Statistics Institute in Madrid said in an e-mailed statement today. Economists expected a 4.7 percent decline, according to the median estimate in a Bloomberg News Survey. Non-seasonally adjusted output rose 0.6 percent from a year earlier. Prime Minister Jose Luis Rodriguez Zapatero’s Socialist government is counting on exports and tourism to support a fragile recovery as the euro area’s highest unemployment rate weighs on consumer spending and investment. Spain’s trade deficit narrowed in July to its lowest level in 13 years as exports surged and the number of foreign tourists hit a record in August, providing a boost for the government is it tries to spur the economy. Finance Minister Elena Salgado yesterday said Spain won’t fall back into a recession this year even as the Bank of Spain says the economy showed “weakness” in the third quarter. The August output increase was led by machinery and consumer goods, said INE, which originally reported that production had declined 2.8 percent in July. Hindering Growth Declining demand in developed countries and the deepest austerity measures in over three decades are undermining the nation’s recovery. Growth slowed in the second quarter to 0.2 percent from 0.4 percent in the previous three months as the country faces a 21 percent unemployment rate and the European sovereign-debt crisis fuels rising borrowing costs. The government, which faces a general election on Nov. 20 that polls indicate it may lose, aims to cut the deficit to 6 percent of gross domestic product this year from 9.2 percent in 2010, and Salgado said yesterday that goal takes “priority” over growth in the “remaining months of the year.” Funcas, the research arm of Spain’s savings-bank association, forecasts the economy will “practically stagnate” in the second half of this year, leaving the full-year growth rate at 0.7 percent. The International Monetary Fund predicts an expansion of 0.8 percent in 2011. “We can expect weak growth in the second half, possibly even slightly negative numbers in the last quarter or the first months of 2012,” Jesus Castillo, an economist at Natixis in Paris, said by phone. To contact the reporter on this story: Angeline Benoit in Madrid at abenoit4@bloomberg.net To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net |
AT&T Judge Asked by U.S., Company to Appoint Special Master.AT&T Inc. and the U.S. Justice Department asked a federal judge to appoint a special master to help manage the government’s lawsuit seeking to block the company’s purchase of T-Mobile USA Inc. In a motion filed today in federal court in Washington , AT&T and the government requested that Richard Levie, a retired judge, be named a special master to oversee the process of the two sides exchanging information as the case moves toward trial. Special masters are often appointed in complex lawsuits to help the judge administer a case. Levie’s help will be important “in light of the expedited trial” schedule, according to the request. Last month, U.S. District Judge Ellen Segal Huvelle, who is hearing the case, set a trial date for Feb. 13. A former associate judge on the District of Columbia Superior Court, Levie has worked as a mediator since 2000, according to the website of Irvine , California-based JAMS, a private dispute resolution service. Levie has mediated cases involving telecommunications, high tech and health care matters, according to the website. He’s the former president of the Academy of Court Appointed Masters. Split Cost AT&T and the government would split the cost of paying Levie, according to the motion. Michele Apostolos, a spokeswoman for JAMS, said it’s against company policy for Levie and other mediators to comment on pending cases. The proposed order, subject to Huvelle’s approval, calls for Levie to handle disputes between the parties over such items as whether particular documents have to be turned over and scheduling when evidence and witnesses have to be produced. The Justice Department sued Dallas-based AT&T and Bonn- based Deutsche Telekom AG (DTE) ’s T-Mobile unit on Aug. 31, saying a combination of the two companies would be anticompetitive. The acquisition would make AT&T the biggest U.S. wireless carrier, followed by Verizon Communications and No. 3 Sprint Nextel Corp. Separate suits to block the purchase have been filed by Sprint and Ridgeland, Mississippi-based Cellular South Inc., the ninth-largest by customers. AT&T on Sept. 30 urged Huvelle to dismiss the Sprint and Cellular South lawsuits, defending the deal as boosting competition. Huvelle is known for moving cases assigned to her quickly. She completes almost all her civil actions within three years and has no motions pending before her for more than six months, according to records filed with the Administrative Office of the U.S. Courts. The case is U.S. v. AT&T Inc. (T) , 11-cv-01560, U.S. District Court, District of Columbia (Washington). To contact the reporter on this story: Jeff Bliss in Washington at jbliss@bloomberg.net To contact the editors responsible for this story: To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net |
Venezuelan Consumer Prices Said to Rise 1.6% in September.Venezuela ’s consumer prices rose 1.6 percent nationwide in September as the pace of monthly price increases slowed, said a government official familiar with the inflation report to be released later today. The inflation rate will begin to decelerate and monthly inflation may be closer to 1 percent in the coming months, said the official, who isn’t authorized to speak publicly. The official declined to say how much prices had risen from a year earlier. The central bank is expected to release the full consumer price report later today. Prices rose 2.2 percent nationwide in August. To contact the reporter on this story: Corina Rodriguez Pons in Caracas at crpons@bloomberg.net To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net |
U.S. Urged to Halt Skilled-Worker Flight or Lose Innovation Lead.The U.S. risks losing its global lead in innovation if it fails to halt an exodus of skilled foreign workers from the country and doesn’t do more to support research and development. That was a message delivered by five corporate executives and seven university leaders at an event yesterday sponsored by Harvard University and the Business Roundtable and hosted by Bloomberg News. They argued that the development of ideas is vital to U.S. economic growth and job creation and said the nation can’t afford to take its preeminent position for granted. “The United States has long been a leader in innovation, but we believe it needs a more focused, national innovation policy,” said Harvard President Drew Gilpin Faust. Besides backing more working visas, group participants also called for more stable and predictable funding of research and development by the federal government and said an R&D tax credit should be made permanent. They also urged Congress to keep its pledge to let the U.S. Patent and Trademark Office have control over all the fees it collects to promote innovation. House Republican leader Eric Cantor and John Holdren, President Barack Obama ’s science adviser, voiced sympathy for the panel’s plea for more visas for foreign workers, though they stopped short of promising immediate action, in separate appearances at the event. ‘Alarming’ Trend “We have an alarming rate of exodus, if you will, of foreign nationals in this country who come here to attend your universities and then find it too difficult to stay here,” Cantor, of Virginia , told the university chiefs and executives, who included John Lechleiter, chief executive officer of drugmaker Eli Lilly & Co. (LLY) ; Bill Green, chairman of consulting firm Accenture Plc and Tim Solso, CEO of diesel truck-engine maker Cummins Inc. “We intend to try and address that.” Some executives called on the government to decouple the issue of obtaining more visas for skilled workers with the move for a broader immigration overhaul, which has been stalled on Capitol Hill over issues such as border security. Holdren told the group, which also included Ellen Kullman , CEO of DuPont Co., and James Goodnight, CEO of SAS Institute Inc., that Obama administration officials “would like to get the high-tech part done if we can.” Members of the panel contrasted the U.S. government’s piecemeal approach to innovation with that taken by the country’s overseas competitors. ‘Mixed Messages’ “Individual countries -- Ireland, the U.K., France , China, Singapore come to mind -- are very aggressively pursuing high- end research-based kinds of opportunities and jobs” through tax credits and other incentives, Lechleiter said. “We get mixed messages sometimes in this country.” John Engler , president of the Business Roundtable , agreed. “There’s no national strategy,” he said. “It’s also about the rise of the emerging market multinational and that the competitors of the future are companies whose names we can’t pronounce,” said Green of Dublin-based Accenture. “That is the competitive threat.” Added Stanford University President John Hennessy, “We’re going to have to step it up.” The leaders focused much of their attention on the nation’s immigration policy. The corporate quest for more skilled workers from overseas has been stymied in Washington , with many lawmakers and the public more focused on the country’s estimated 10 million illegal immigrants. That drew frustration from the academics and industrialists at the “Innovation and the Economy” event. ‘Sausage-Making Process’ “We have a crisis,” said Green. “The sausage-making process of getting an outcome, I think, puts us at a huge disadvantage.” The issue is economic because workers with essential skills are leaving the U.S. and contributing to the competition, the executives and university leaders said. “There are jobs today that are open because we don’t have the skilled workforce here,” said Kullman of Wilmington, Delaware-based DuPont. “If we want to continue to create economic growth we have to fill those jobs with the best and the brightest no matter where they come from.” The business agenda calls for increases in worker visas for skilled and unskilled labor, and more employment-based green cards -- proof of permanent residency in the U.S. that can allow for a lifetime career. Lechleiter said it takes Indianapolis-based Lilly five years on average to get green cards for the students it hires from Harvard in Cambridge, Massachusetts. ‘Stop Messing Around’ “An innovative solution is that we take these really talented graduate students that we have that we’re granting Ph.Ds. to and we staple that green card right to that Ph.D.,” said Sally Mason, president of the University of Iowa. “And we stop messing around and really diverting talent from the United States back to other places.” Engler said it would be difficult politically to separate the issue of skilled foreign workers from broader immigration reform. “Nobody will let it loose,” he said. Panel participants also stressed the importance of government support of research and development in promoting innovation and faster economic growth. Lechleiter said lawmakers should permanently renew the research-and-development tax credit to make it easier for companies to compete globally. Targeted Tax Breaks The credit is among dozens of targeted tax breaks set to expire Dec. 31. It was first enacted in 1981 and has been renewed 14 times since then. In 2008, the most recent year for which data are available, companies claimed $8.3 billion in research credits, according to Internal Revenue Service data. Stanford’s Hennessy voiced concern that federal R&D spending would be cut in the drive to reduce the U.S. deficit, which the Congressional Budget Office estimates was $1.3 trillion in the fiscal year that ended Sept. 30. The entire federal research-and-development investment in universities is a “tiny piece of the federal budget,” he said. To cut that funding off “will just result in weaker economic growth for the country and fewer jobs.” Researchers need to be assured of a steady stream of funding to carry out their work, added Linda Katehi, chancellor of the University of California at Davis. “It’s absolutely critical,” she said. “We find we have been having difficulties in getting our researchers to participate in this process early in their careers.” About 60 percent of spending on basic research comes from the federal government. The situation is different in some foreign countries, Harvard’s Faust said. Institutions in China , Singapore and Europe “are assuring our faculty that they will have almost unlimited support for their work,” she said. “All these other countries want to be like us,” said Accenture’s Green. To contact the reporter on this story: Rich Miller in Washington at rmiller28@bloomberg.net To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net |
Trichet Says Council Discussed Rate Cut, Other Options.European Central Bank President Jean- Claude Trichet said cutting interest rates was part of the discussions at today’s governing council meeting. “There has been a discussion on the pros and cons of decreasing rates or keeping rates where they are,” Trichet said at a press conference in Berlin today. “After a long discussion we have decided by consensus to maintain rates.” To contact the reporter on this story: Jana Randow in Frankfurt at jrandow@bloomberg.net To contact the editor responsible for this story: Gabi Thesing at gthesing@bloomberg.net |
Roesler Says ‘Emphatic’ German Aim to Keep All 17 States in Euro.German Economy Minister Philipp Roesler said it is his country’s “emphatic” aim to keep all 17 members of the euro in the single currency. In a speech to a group of businessmen in Athens tonight, Roesler said his proposals for the future European Security Mechanism, called ESM, that are aimed at helping states forced to tap the rescue fund, underline that goal. To contact the editor responsible for this story: Brian Parkin at bparkin@bloomberg.net |
Axel Springer, Continental, Homag: German Equity Market Preview.The following is a list of companies whose shares may have unusual price changes in Germany. Stock symbols are in parentheses and prices are from the last close. The benchmark DAX Index rose 3.2 percent to 5,645.25. Axel Springer AG (SPR) : The media company’s possible bid to buy WAZ Media Group’s stake in Kronen Zeitung newspaper could be blocked by the Dichand family, which owns half of Kronen Zeitung, German newspaper Handelsblatt said in a preview of an article for tomorrow’s edition. The shares surged 5.2 percent to 26.35 euros. Continental AG (CON) : The world’s fourth-largest tiremaker plans to spend more than $500 million to build a new tire factory at Sumter, South Carolina , to meet increasing demand. The stock jumped 5.1 percent to 44.74 euros. Homag Group AG (HG1) (HG1 GY): The company will expand its restructuring measures and expects to cut about 180 jobs, it said in a statement today. The measures are expected to generate an Ebitda increase of 6 to 8 million euros per year starting in 2013. Homag expects a small loss after taxes for 2011, according to the statement. The shares rose 2.2 percent to 8.94 euros. To contact the reporter on this story: Karin Matussek in Berlin at kmatussek@bloomberg.net To contact the editor responsible for this story: Anthony Aarons at aaarons@Bloomberg.net . |
Peru Central Bank Keeps Rate at 4.25% for Fifth Month on Global Slowdown.Peru ’s central bank left borrowing costs unchanged for a fifth month as the threat of recession in Europe and the U.S. outweighs concern about accelerating inflation. The seven-member board, led by central bank President Julio Velarde, kept the overnight rate at 4.25 percent, matching the estimates of 17 of the 18 economists surveyed by Bloomberg. One analyst predicted a 0.25-point cut to 4 percent. “The decision takes into account the slower growth being observed in some components of spending and production, as we as a heightening of global financial risks,” the bank said in a statement on its website announcing the decision. “The central bank will change its monetary policy stance if these trends continue.” The threat of stagnation in Europe and the U.S. has dimmed the outlook for Peru’s commodity-dependent economy and led the government to announce what it has called “preventive” stimulus measures. Though the central bank has indicated it will cut rates if global risks intensify and domestic activity slows, rising prices and stronger-than-expected domestic growth indicate there’s no need for laxer policy yet, said Juan Pablo Fuentes, a Latin America economist at Moody’s Analytics Inc. “There isn’t an urgent need for lower rates because the economy is growing and inflation is above target,” Fuentes said in a telephone interview from West Chester , Pennsylvania. “We should see a small rebound in growth in the second quarter of next year assuming there isn’t any bad news about the global economy.” Politics, Global Outlook The Andean nation is tapping its first fiscal surplus in three years to finance stimulus measures worth about $470 million as it seeks to reverse a decline in public infrastructure spending in the first half of this year. The stimulus will become more “aggressive” should a global slowdown cause exports and company spending to ease, Finance Minister Miguel Castilla said Sept. 22. The International Monetary Fund on Sept. 20 cut its 2011 growth forecast for Peru to 6.2 percent from 6.6 percent previously. Growth will slow to 5.6 percent next year, the Washington-based lender said. The central bank’s latest survey shows companies are less optimistic about domestic demand and hiring prospects because the global outlook has darkened, said Carlos Durand, president of the Lima Chamber of Commerce, in a Sept. 27 interview. Growth, Commodities Investor caution on the global outlook and “political uncertainty” following Peru’s presidential election is affecting medium and long-term investment, Luis Castellanos, chief executive of Banco Internacional del Peru, told reporters Sept. 29. Demand for consumer loans remains “vigorous,” he said. President Ollanta Humala on Oct. 3 confirmed Velarde’s appointment to serve a second five-year term, which Pedro Tuesta , a former Peruvian central bank analyst and current economist at 4Cast Inc. in Washington , said indicated policy continuity. Growth in retail and services helped offset a slowdown in manufacturing and construction in July and fuelled a 6.5 percent rise in gross domestic product, beating analysts’ and the central bank’s expectations. Cement demand rose for the first time in three months in August while electricity output climbed at the fastest annual pace in six months, which suggests growth is accelerating, Tuesta said. Trade, China Peru’s trade surplus will probably fall to $4.3 billion next year from $7.4 billion this year because of lower copper, zinc, gold and silver prices, Velarde said Oct. 4. China ’s growth will remain “strong” this year and next, which “will guarantee that the price of exports will remain relatively high,” he said. Gross domestic product growth will slow to 5.7 percent in 2012 from 6.3 percent this year, according to the central bank. Economic activity will slow in the next few months amid weaker construction and manufacturing output even though consumer demand remains “very strong” Velarde told congress Oct. 4. “In investment, there isn’t a lot of pessimism, but nor has there been such a strong recovery yet.” Investors “are waiting to see what will happen with the global outlook.” Policy makers will probably give more weight to the fall- out from Europe’s debt crisis, which led global stocks and commodity prices to tumble since their last meeting, said Roberto Melzi , at strategist at Barclays Capital Inc. in New York. “Risks to economic activity haven’t dissipated anywhere by any means,” said Melzi, who forecasts a 0.25-point rate cut today to be followed by similar cuts at the bank’s November and December meetings. “The global crisis is deepening.” ‘Monetary Policy Instruments’ Higher fuel costs pushed Peru’s consumer prices up 0.33 percent in September from 0.27 percent in August, driving the annual inflation rate to 3.73 percent, a two-year high. The central bank targets annual inflation in a range of 1 percent to 3 percent. Monthly inflation may slow to close to zero before year-end as some prices reverse recent increases, Velarde said Sept. 16. The annual inflation rate will converge toward the central bank’s target range next year, he said. “The board is monitoring the outlook for inflation and its determinants so that it can make future adjustments to monetary policy instruments in a fast and timely manner,” the bank said in its statement accompanying its decision. Peru’s sol posted the steepest quarterly decline since 2008 in the July-through-September period as copper prices fell and concern about slowing world growth wiped $10 trillion from global equities. The currency rose 0.5 percent today, capping its biggest two-day gain since May 12-13 as the European Central Bank took steps to shore up the euro area’s money market. To contact the reporter on this story: John Quigley in Lima at jquigley8@bloomberg.net. To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net . |
Pound Fluctuates Versus Euro Before BOE Stimulus, Interest-Rate Decision.The pound swung between gains and losses against the euro before the Bank of England ’s latest interest-rate decision amid speculation it will restart a bond- purchase program to help revive the U.K. economy. The Monetary Policy Committee will leave its key rate unchanged at 0.5 percent, according to all 53 economists surveyed by Bloomberg. Eleven of 32 respondents surveyed separately predict at least a 50 billion-pound ($77 billion) increase in its asset-purchase program, known as quantitative easing. “The market is still focused on the likelihood of further QE by the November meeting,” said Ian Stannard , London-based head of European currency strategy at Morgan Stanley. “The BOE will move towards further QE in coming months and ultimately sterling will come under pressure.” The pound was little changed at 86.26 pence per euro as of 11:07 a.m. in London, after earlier dropping 0.4 percent. It was 0.1 percent weaker at 118.62 yen and strengthened 0.1 percent to $1.5481. The Stoxx Europe 600 rose 1.6 percent and the U.K.’s FTSE 100 Index (UKX) advanced 1.4 percent. Morgan Stanley recommends selling the pound on any “relief rallies” that are likely to occur should the central bank refrain from announcing further stimulus for the U.K. economy. The Bank of England has faced pressure to embark on more quantitative easing to help revive an economy battling the steepest government spending cuts since World War II and a worsening euro-area debt crisis. ‘Awful’ U.K. Growth The U.K.’s economy grew less than expected in the second quarter, expanding 0.1 percent from the first three months of the year, the Office for National Statistics said yesterday. That was lower than the 0.2 percent previously published by the statistics body and also missed the 0.2 percent expansion forecast in a Bloomberg survey of economists. “There’s a reasonable chance that the Bank of England could do something as early as today,” said Elisabeth Afseth , a fixed-income analyst at Evolution Securities Ltd. in London. “We had the downward revision of the Q2 GDP numbers which were pretty awful even before, so I don’t think there’s anything in the data that would really stop them.” If the central bank doesn’t announce an expansion of stimulus today “it’s probably a matter of waiting a month, rather than it not happening,” Afseth said. “That ought to give a little bit of support to the gilts.” The U.K. 10-year gilt yield was little changed at 2.36 percent. The 3.75 percent security due September 2021 traded at 112.225. The two-year note yielded 0.58 percent. Gilts have returned 12 percent this year, according to indexes compiled by Bloomberg and the European Federation of Financial Analysts Societies, surpassing 8 percent for German bunds and 5.8 percent for French securities. The pound has declined 1.3 percent in the past six months, according to Bloomberg Correlation-Weighted Currency Indexes, which measure a basket of 10 developed-market currencies. To contact the reporter on this story: Lucy Meakin in London at lmeakin1@bloomberg.net. To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net . |
Qantas Orders 110 A320s From Airbus in Short-Haul Fleet Push.Qantas Airways Ltd. (QAN) said it placed a firm order for 78 fuel-efficient A320neo aircraft and 32 A320 classic single-aisle jets, in the largest order in Australian aviation to date, according to a statement today. The aircraft will be used on short and mid-range routes, according to the airline. Airbus has won 1,245 orders and commitments for the A320neo since introducing the variant at the end of last year, it said. To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net |
Orange Juice Rises as U.S. Inventories Ebb; Cotton Advances.Orange-juice futures climbed to a one-week high on signs of dwindling supplies in the U.S., the world’s second-biggest producer. Cotton also advanced. As of Oct. 4, orange-juice inventories monitored by ICE Futures U.S. fell 46 percent in the past year. Most of the fruit supplies from Florida , where the harvest started this month and runs through July, may take a month to reach processors, said Jimmy Tintle , an analyst at Transworld Futures. The Standard & Poor’s GSCI index of 24 raw materials rose as much as 2.6 percent today. “Supplies are down at the end of the harvest,” Tintle said in a telephone interview from Tampa, Florida. “The whole commodity sector has been rising the last couple of days, and that’s been helping.” Orange-juice futures for November delivery rose 1.5 cents, or 1 percent, to settle at $1.5485 a pound at 2 p.m. on ICE in New York. Earlier, the price reached $1.566, the highest for a most-active contract since Sept. 26. In the third quarter, the price tumbled 20 percent, the most since the end of 2008. The dollar fell for the second straight day against a basket of currencies, enhancing the appeal of U.S. commodities. Brazil is the leading orange grower, followed by Florida. U.S. equities advanced for the third straight day as European officials presented plans to contain the sovereign-debt crisis. Cotton futures for December delivery rose 0.43 cent, or 0.4 percent, to $1.0273 a pound in New York, the third straight gain. To contact the reporter on this story: Marvin G. Perez in New York at mperez71@bloomberg.net To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net |
Italy Reports Seven New Cases of Anthrax in Widening Outbreak.Italy reported seven new cases of anthrax in livestock since last week as the deadly animal disease spreads in the country’s south, bringing affected farms to 26 since the first confirmation in September. The illness killed cattle, sheep and horses or donkeys on seven farms across four towns southeast of Naples, Italy’s Ministry of Health said in an alert today published online by the Paris-based World Organization of Animal Health, or OIE. One of the towns had no previous occurrence. Anthrax , which has been used as a biological weapon, is caused by spores of the bacterium Bacillus anthracis and can survive in soil years after an outbreak, according to the OIE. Livestock typically become infected by ingesting spores from the soil or in feed, according to the group. Animals died on four farms in Pietrapertosa as well as on farms in Corleto Perticara and Padula, adding to previously reported cases, according to the alert. Italy also found anthrax in Laurenzana, the first case there, it showed. The outbreak continues, and measures to fight the disease include animal-movement controls and disinfection of infected farms, the animal-health group said. Livestock is not being vaccinated, the OIE said. To contact the reporter on this story: Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net . |
Alliance, Gazprom Neft, Lukoil: Russian Equity Market Preview.The following companies may be active in Russian trading. Stock symbols are in parentheses and share prices are from the previous close of trading in Moscow. The 30-stock Micex Index gained 4.2 percent to 1,318.29. The dollar-denominated RTS Index climbed 4.5 percent to 1,271.71. Alliance Oil Co. (AOIL SS): The Stockholm-traded oil producer with Russian assets is scheduled to release a third- quarter operational update. Alliance Oil rose 2.5 percent to 74.75 Swedish kronor. OAO Gazprom Neft (SIBN RX): Petroleos de Venezuela SA expects to begin oil production of 50,000 barrels a day at its Junin 6 field in 2012, Oil Minister Rafael Ramirez said today on state television. PDVSA, as the state-owned company is know, will develop the field as a majority shareholder along with the Consorcio Nacional Ruso, which is a venture with Russian oil companies including OAO Gazprom Neft and OAO Rosneft. Gazprom’s oil arm rose 2.4 percent to 109.90 rubles. OAO Lukoil (LKOH RX): Russia ’s second-biggest oil producer may invest almost $20 billion within the next decade to upgrade its refineries, Interfax reported today, citing Deputy Chief Executive Officer Leonid Fedun. Lukoil rose 2.6 percent to 1,588.70 rubles. To contact the reporter on this story: Anna Shiryaevskaya in Moscow at ashiryaevska@bloomberg.net To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net |
OTP Bank Leads Hungarian Equity Index to Highest in Three Weeks.Hungary’s stock index increased for a third day to the highest in nearly three weeks, led by lenders OTP Bank Nyrt. and Foldhitel es Jelzalogbank Nyrt. The BUX equity gauge increased as much as 1.6 percent to 16,718.24, its highest since Sept. 16, and traded up 1.3 percent by 9:35 a.m. in Budapest. OTP, the country’s biggest lender with a 28 percent weighting in the index, gained 4.1 percent. To contact the reporter on this story: Krystof Chamonikolas in Prague at kchamonikola@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net |
On Corporate Taxes, Put the Public in Publicly Traded: View.How can you tell how much federal income tax a publicly traded company pays in a specific year? You can’t. Writing in the Washington Post last month, journalist Allan Sloan suggested this can be corrected by demanding that the Financial Accounting Standards Board require companies to disclose this number. This was a follow-up to his critique of a New York Times article published in March reporting that General Electric Co. (GE) had paid no U.S. income tax in 2010. Sloan asked for anyone who supports his call to stand up and be counted. And so we endorse Sloan’s idea and will up the ante: Make the income-tax returns of all companies with shares traded on U.S. stock markets available to the public. It’s not such a radical idea. In fact, it would restore the intent of the law when the first permanent federal corporate income tax was adopted by Congress in 1909, stating that returns “shall constitute public records.” Over the years, legal rulings and regulations placed limits on disclosure. An impermeable wall was erected in 1976 in response to the Nixon administration’s misuse of tax returns to harass those on its notorious “enemies list” of journalists and anti-Vietnam War protesters, according to a 1981 study by Boris Bittker, a now-deceased professor at Yale Law School. Cookie Jar That has left us with the current sorry state of U.S. financial reporting: Although U.S. company financial statements are choked with numbers on taxes, they omit critical and needed information. There is an entry for how much cash is paid in taxes, but no indication to whom or where. There is another line known as the provision for taxes. This is little more than a cookie jar that companies can use to stuff with money for pulling out later as needed. Making corporate tax returns public would enhance investor understanding of how a company makes money. It might even lead to changes that would lower the cost of doing business. Here’s why. Today, there are two sets of books for keeping track of a company’s financial performance. These parallel universes are, in many ways, at odds with each other. One reporting system suits the purposes of the Internal Revenue Service , whose goal as the tax collector is to maximize income and thereby increase its claim. The other, known as generally accepted accounting principles, contains the information now made available to the public and investors. The goal of this system is to keep taxable income in check while preventing investors from being deceived. Financial Clarity Mihir A. Desai, a professor of finance at Harvard Business School , says public regulators should consider reconciling most of the differences between the two reporting systems. This would provide more financial clarity, and let companies spend a lot less time taking the same information and shaping it to conform to different rules. Disclosing corporate tax returns might be a simpler alternative. It may well accomplish something beyond the reach of the IRS: intense scrutiny by private investors, the best financial minds in the world. Companies are sure to resist, insisting that making their returns public would divulge proprietary information. To which we would ask: What exactly are the secrets hidden in a company’s tax returns? A drugmaker doesn’t disclose the molecular formula for a new medication in its tax filings. A software maker doesn’t include the code for a novel program that makes Web searches faster. No, the main secrets in corporate tax filings are the dodges that companies and their auditors cook up to game tax collection. Indeed, recent history is full of examples of companies and accounting firms creating phony losses to lower taxable income. In even more perverse cases, unprofitable companies such as Enron Corp. goosed their returns to make it look as if they had taxable income. Unique Strategies But in those rare instances when a company can convince the IRS that its tax strategies are unique and need protecting, there can be a provision for keeping that part of a return confidential. As for the privacy rights , we wouldn’t advocate public disclosure of personal tax returns. More importantly, there should be an honest acknowledgement of the difference between individuals and businesses. In spite of recent court rulings, which disingenuously conflate personal freedoms with corporate rights, companies aren’t people and never will be. To contact the Bloomberg View editorial board: view@bloomberg.net . |
Stocks, Euro Advance as Treasuries Drop.U.S. stocks rallied for a third day, commodities gained and Treasuries slid as European officials detailed plans to tame the sovereign debt crisis and reports on retail sales and jobless claims bolstered optimism in the economy. The euro reversed an earlier drop versus the dollar. The Standard & Poor’s 500 Index gained 1.8 percent to 1,164.97 at 4 p.m. in New York. The Russell 2000 Index of smaller U.S. stocks extended a three-day advance to 11 percent, its best since 2009. The Stoxx Europe 600 Index surged 2.7 percent. Ten-year Treasury yields added 10 basis points to 1.99 percent. The euro rose 0.7 percent to $1.3439 after losing 0.8 percent. The S&P GSCI Index of commodities jumped 2.5 percent as oil increased 3.7 percent to $82.59 a barrel. American equities extended a global rally after European Central Bank President Jean-Claude Trichet said the ECB will resume covered-bond purchases and reintroduce yearlong loans for banks, while defying calls for an interest-rate cut and acknowledging “downside risks” to the economy have intensified. The European Commission is pushing for a coordinated capital injection for banks to shield them from the fallout of a potential Greek default. “People have priced in a Lehman II type of situation,” Brian Barish, Denver-based president of Cambiar Investors LLC, which oversees about $8 billion, said in a telephone interview. “You start to hear some credible stuff on European bank recapitalization. They will do what they’ve got to do to prevent a Lehman from happening. There’s a good chance we might’ve had a bottom in stocks.” Covered Bonds The 2.5 trillion-euro market for covered bonds -- assets backed by mortgages or public-sector loans -- underpins much of Europe ’s real estate lending, which almost ground to a halt in the wake of Lehman Brothers Holdings Inc.’s collapse in September 2008. U.S. stocks also climbed after claims for unemployment benefits rose less than forecast last week to a level that shows the pace of dismissals may be slowing. Applications for jobless benefits climbed by 6,000 to 401,000, Labor Department figures showed. Economists projected 410,000 claims, according to the median estimate in a Bloomberg News survey. The monthly average dropped to the lowest level since the end of August. Government data tomorrow are forecast to show employers added 55,000 jobs last month and the unemployment rate held at 9.1 percent, according to the median estimates. Bear Market Averted The S&P 500 has rebounded 6 percent since Oct. 3, when it closed within 1 percent of a level that would have marked a bear-market plunge of 20 percent from its April peak. The S&P GSCI commodities gauge is up 5.3 percent in two days, its best back-to-back advance since May, and has trimmed its drop from this year’s high to 20 percent. Treasury yields have increased after demand for safer assets dragged the 10-year note’s rate to a record low of 1.67 percent on Sept. 23. The Dollar Index has slipped about 1.1 percent since Oct. 4, when it reached the highest level since January. Indexes of financial, commodity and consumer companies rose at least 2.2 percent today to lead gains in all 10 industry groups in the S&P 500. Bank of America Corp. jumped 8.8 percent and Alcoa Inc. rallied 5.4 percent for the top gains in the Dow Jones Industrial Average. The S&P 500 Financials Index has rallied 8.8 percent in three days, its steepest advance since July 2009, to trim its year-to-date loss to 23 percent. U.S. Treasury Secretary Timothy F. Geithner told the Senate Banking Committee today that there is “absolutely” no chance of another U.S. financial institution collapsing like Lehman Brothers. Retail Sales, Apple Target Corp. climbed 4.3 percent today and Limited Brands Inc. and Saks Inc. also rose after reporting September sales that surpassed analysts’ projections. Apple Inc. shares slipped 0.2 percent after co-founder Steve Jobs died. The cost to protect the debt of Morgan Stanley and Citigroup Inc. declined amid growing speculation Europe’s leaders will be able to prevent the debt crisis from infecting bank balance sheets. Credit-default swaps on Morgan Stanley, the owner of the world’s biggest retail brokerage, fell 55 basis points to 475, the biggest decline since May 2009, and those on Citigroup slid 40.5 basis points to 304.57, the largest drop since Nov. 24, 2008, according to data provider CMA. Swaps on Goldman Sachs Group Inc. eased 25 basis points to 371, the data show. Wall Street strategists say the S&P 500 will post the biggest fourth-quarter rally in 13 years even after they cut forecasts at a rate exceeded only during the credit crisis. The benchmark index for U.S. stocks will climb 14 percent from yesterday to end 2011 at 1,300, according to the average estimate of 12 strategists surveyed by Bloomberg. The last time they were this bullish in October was 2008, when the group predicted a 27 percent gain and the index lost 18 percent. Trading Range Excluding its dip to a 13-month closing low of 1,099.23 on Oct. 3, the S&P 500 has mostly traded between about 1,120 and 1,220 for the past two months. Following 14 periods since 1990 when the index was stuck in a range, more than 75 percent resulted in gains in the next one, three and six months, according to Birinyi Associates Inc., the Westport, Connecticut- based money management and research firm. The average trading range studied lasted about seven months, with the shortest beginning in March 1998 and lasting three months, Birinyi data show. “We’ll need clear economic data or policy movements out of Europe to break out of that range,” Wasif Latif, vice president of equity investments at USAA Investment Management Co. in San Antonio , which oversees about $50 billion, said in a telephone interview. Earnings Season Alcoa Inc., the largest U.S. aluminum producer, will mark the unofficial start of the earnings-reporting season when it reports results on Oct. 11. Third-quarter profits for S&P 500 companies are projected to have grown 13 percent, according to analyst forecast compiled by Bloomberg, down from an estimate of 17 percent when the index traded at a three-year high at the end of April. Among European stocks, BNP Paribas SA, Credit Agricole SA and Natixis surged at least 5.3 percent after Le Figaro said the French government is working on a contingency plan to take stakes in the country’s lenders. BHP Billiton Ltd., the world’s biggest mining company, rallied 5.9 percent as metal prices increased. SABMiller Plc surged 7 percent after a report by Brazilian news website IG said the brewer is in talks to be bought by Anheuser-Busch InBev NV. Spokespeople for both companies declined to comment. Bonds, Currencies Ten-year Spanish and Italian bond yields decreased seven basis points each, while rates on U.K., French and German debt rose at least four points. The dollar weakened against 14 of 16 major peers today, with the Brazilian real surging 2.7 percent to lead gains after higher-than-forecast inflation spurred bets the central bank may slow the pace of interest-rate cuts. The euro strengthened versus 10 of 16 major peers. The pound slid against all 16 major peers after the Bank of England expanded its bond-purchase program. The Australian and New Zealand currencies strengthened against most peers. Copper futures climbed 4.5 percent to $3.2465 a pound in New York and rallied 5.9 percent in London to lead gains in 19 of 24 commodities tracked by the S&P GSCI Index. The MSCI Emerging Markets Index of stocks surged 3.7 percent, extending its rebound from a two-year low on Oct. 4. Benchmark indexes in South Korea , Brazil and Chile climbed at least 2.5 percent. To contact the reporters on this story: Michael P. Regan in New York at mregan12@bloomberg.net ; Rita Nazareth in New York at rnazareth@bloomberg.net To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net |
U.S. Natural Gas Fund Discount at 0.11% on Oct. 5.The U.S. Natural Gas Fund, the largest exchange-traded fund in the fuel, closed at a discount of 0.11 percent on Oct. 5, according to figures on the fund’s website. A discount means that the closing price of the shares is lower than the value of its underlying holdings in the fuel. Natural gas for November delivery fell 6.8 cents, or 1.9 percent, to $3.57 per million British thermal units on the New York Mercantile Exchange on Oct. 5. NOTE: To sidestep position limits imposed by the Commodity Futures Trading Commission, the fund buys bilateral, over-the-counter swaps that are not subject to exchange limits. These swaps are fully collateralized with investment grade counterparties. The fund aims to track the price of natural gas delivered at Henry Hub in Erath, Louisiana , the delivery point for the future traded on the New York Mercantile Exchange. The ETF buys the near-month contract, then rolls forward by selling it before expiration and buying the following month. SOURCE: United States Natural Gas Fund To contact the reporter on this story: Daniel Petrie in Sydney at dpetrie5@bloomberg.net To contact the editor responsible for this story: Alex Tanzi at atanzi@bloomberg.net |
Brazil Sells Part of NTN-F and LTN Bills Offered at Auction.The Brazilian government sold 550,000 out of 650,000 NTN-F notes offered at auction today and 4.69 million LTN bills out of 5.5 million offered, according to a preliminary statement posted on the Central Bank ’s website. The Brazilian government sold 50,000 NTN-F notes due 2021 to yield 11.5479 percent on average and 500,000 NTN-F due 2017 to yield 11.4778 percent on average, according to the statement. The Treasury also sold 1.5 million LTN bills due January 2015 to yield 11.1384 percent on average, 2.99 million LTN bills due January 2014 to yield 10.8142 percent on average and 201,250 LTN due April 2012 to yield 10.7472 percent on average, the Treasury said. To contact the reporter on this story: Telma Marotto in Sao Paulo at tmarotto1@bloomberg.net To contact the editor responsible for this story: Leonardo Lara at llara1@bloomberg.net |
Ghana Cedi Heads for Biggest Gain in 2 Weeks; Bank Sells Dollars.Ghana ’s cedi headed for the biggest gain in more than two weeks as the west African country’s central bank sold the U.S. currency and demand for dollars by importers eased. The currency of the world’s second-largest cocoa producer appreciated as much as 0.9 percent to 1.6035 per dollar before trading 0.2 percent up at 1.615 per dollar as of 2:34 p.m. in Accra, the capital. A close at this level would be the cedi’s biggest increase since Sept. 19. The cedi reached 1.621 on Oct. 4, the weakest level since at least 1994, when Bloomberg started compiling the data. “The central bank sold dollars on Oct. 4 and yesterday, so we are no longer seeing the rush for dollars as in the days before,” Jacob Brobbey, a currency trader at the local unit of Barclays Bank Plc, said in a telephone interview today. The Bank of Ghana monitors the currency market daily and provides addition supply when necessary, Collins Antwi, assistant director at the central bank’s treasury department, said in a telephone interview. He declined to say whether the regulator had sold dollars today. To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net . |
AstraZeneca Will Cut 400 U.S. Jobs Amid Generic Drug Pressure.AstraZeneca Plc (AZN) , the U.K.’s second- biggest drugmaker, plans to eliminate 400 positions in the U.S. as it prepares for competition from generic medicines. AstraZeneca will cut the jobs at its Wilmington, Delaware, location along with some “field-based, nonsales roles,” the London-based company said today in a statement on its website. About 70 of the positions to be reduced will come from existing vacancies, the drugmaker said. The company’s top seller, the cholesterol-lowering pill Crestor, will face added competition later this year after generic copies of Pfizer Inc. (PFE) ’s Lipitor come on the market. Crestor, which generated $5.69 billion in sales last year, will lose patent protections in the U.S. as early as 2016. The job reductions come atop 550 AstraZeneca announced for Wilmington last year. The move is “part of the company’s strategy to operate its business more effectively and efficiently to best serve patients in the United States ,” AstraZeneca said in the statement. “The changes will enable the company to compete in a challenging environment, including pricing pressures and the continuing growth of generic medicines.” To contact the reporter on this story: Alex Nussbaum in New York at anussbaum1@bloomberg.net To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net |
Claymore Gold Bullion ETF Holdings Increase 8,092 Ounces.Gold holdings in the Claymore Gold Bullion exchange-traded fund increased 8092 ounces to 346,293 ounces as of Oct. 5, according to figures on the fund’s website. To contact the reporter on this story: Stephen Rose in Washington at srose31@bloomberg.net To contact the editor responsible for this story: Alex Tanzi at atanzi@bloomberg.net |
12 People Punished for Shanghai Subway Crash, Xinhua Says.Twelve people responsible for an accident in the Shanghai subway on Sept. 27 were punished by the government, Xinhua News Agency said in a flashed headline today, without citing anybody. Investigators found that train dispatchers sent wrong commands without following proper procedures, which caused the train crash, Xinhua said. Tang Zhihua, head of dispatch of the control center of Line 10 was dismissed, it said. To contact the editor responsible for this story: Mohammed Hadi at mhadi1@bloomberg.net |
Allianz Sees ‘Bubble Pricing’ for Some Prime Commercial Property.Allianz SE (ALV) , Europe ’s largest insurer, is finding it tougher to meet its target for spending on prime commercial real estate after competition drove up prices in German, French and British hotspots. “We want to buy more assets for our balance sheet, but we need to be very selective,” Olivier Piani, Allianz Real Estate’s chief executive officer, said at the Expo Real trade fair in Munich today. “Some assets are too expensive.” Real-estate investors are focusing on properties that generate long-term rental income as economic growth slows and the euro region debt crisis makes financing more difficult, said Peter Damesick, CBRE Group Inc.’s chief European economist. The bulk of investment targeted offices in the major western European cities and dominant shopping centers, he said. The weight of money seeking the best assets has driven down capitalization rates, an industry gauge for investment that measures rental income as a proportion of property value. RREEF Real Estate, the property asset management arm of Deutsche Bank AG plans to sell its stake in Perlacher Eukaufsparadies mall east of Munich, known as PEP, for around 400 million euros ($530 million). Annual rental income generated by the center may represent 4.5 percent of the asking price. “The PEP auction will be very expensive,” Stefan Brendgen, Allianz Real Estate’s head of Germany said at the trade fair. “We are seeing bubble pricing in certain assets.” With more than 5 billion pounds ($7.7 billion) of central London properties for sale, some buildings are being offered at prices that are “detached from the economic reality,” said Chief Investment Officer Charles Pridgeon. ‘No Room for Growth’ In France , capitalization rates for prime offices in Paris have fallen to 4.5 percent, leaving “no room for growth in capital values,” said Olivier Wigniolle, Allianz’s head of France and Benelux. Allianz is in talks to acquire as much as 500 million euros of real estate in those countries, he said, adding “I’m not sure we are going to push the limit to make these acquisitions.” Allianz has made about 1.5 billion euros of real estate investments or development commitments this year. Deals include the 360 million-euro purchase last month of an 80 percent stake in Frankfurt ’s Skyline Plaza mall and a 310 million-euro loan made to DWS Investment GmbH to buy Deutsche Bank headquarters in Frankfurt. The spending is “less than we would have wished,” CEO Piani said. In March, he said he had about 2 billion euros to spend as he aims to double Allianz’s investment in commercial buildings to 30 billion euros by 2014. To contact the reporter on this story: Simon Packard in London at packard@bloomberg.net To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net |
Richemont’s Shanghai Tang to Double Chinese Stores as Luxury Demand Climbs.Shanghai Tang , the fashion boutique brand owned by Cie Financiere Richemont SA (CFR) , plans to almost double its stores in China , its fastest growing market, as demand for luxury goods rises. “China is the number one luxury market in the world,” Executive Chairman Raphael le Masne de Chermont said in an interview in Hong Kong. Chermont plans to open a flagship Shanghai store next year to expand sales of China-inspired fashions including silk kimonos for $470, men’s washed denim shirts with mandarin collars at $235 and travel umbrellas at $60. The brand also aims to increase its Chinese shops to 30 within the next two years from the current 17 as rising wages in the Asian country drives up demand for luxury goods. The focus in China is also a recognition that consumers there are driving demand for fashion brands worldwide, including LVMH Moet Hennessy Louis Vuitton SA (MC) , Chermont said yesterday. “Who do you think will queue for LV in Paris?” he asked rhetorically. “Not Westerners.” The proportion of Shanghai Tang customers from mainland China buying at the boutique’s 42 locations worldwide grew to 18 percent from 2 percent the same time three years ago. Chermont expects this number to surpass the sales contribution from U.S. customers -- at about 22 percent -- in the next 18 months. “Shanghai Tang has done a fantastic job of building brand equity and has become a genuine luxury brand in Hong Kong and the West,” said Matt Marsden, director of consumer and retail research at Daiwa Capital Markets. “This will help give it credibility and increase the chances of success as the company expands in China.” Location, Location The retailer had its flagship store housed in Hong Kong ’s Pedder Building since it was founded by David Tang in 1994 and had been paying HK$3 million ($385,000) a month in rent. With Western brands trying to flock to Hong Kong’s Central shopping district, the city’s real estate market went “totally out of control,” Chermont said. Shanghai Tang will be moving to a 20,000 square-foot (1,860 square meter), four-storey building -- to be called Shanghai Tang Mansion -- about 1,000 feet (320 meters) from its current store by March next year, Chermont said. He declined to provide the exact location, explaining that the company will be having a guessing competition online. The herald of U.S. retailers Abercrombie and Fitch Co., which is taking over Shanghai Tang’s store space, and Gap Inc. to Central has made the area more mass-market, Chermont said. The company does not expect the move to affect sales because it is setting up a pop-up store in Hong Kong’s Pier Four in November and December this year. “We have been buying the same way as if we were trading normally,” Chermont said. The company will be building Mongolian Gers, or huts, in the harborfront location to coincide with its Mongolian Christmas collection. Shanghai Tang plans a Paris store in 2013 and to reopen in Tokyo ’s Ginza shopping district in 2014, Chermont said. To contact the reporter on this story: Natasha Khan in Hong Kong at nkhan51@bloomberg.net Frederik Balfour in Hong Kong at fbalfour@bloomberg.net To contact the editor responsible for this story: Jason Gale in Singapore at j.gale@bloomberg.net |
Merkel Diverges From Sarkozy on Greek Default Threat to Banks: Euro Credit.Angela Merkel and Nicolas Sarkozy are running out of road. Whether to allow Greece to default and how to manage the fallout, questions they have tried to avoid for more than a year, may finally require answers as European officials turn to fortifying banks and consider ways of easing Greece’s debt load. It costs $6 million plus $100,000 a year to insure $10 million of Greek securities for five years, with credit-insurance prices pointing to a 91 percent chance of default. As the German chancellor and French president prepare to meet in two days for their eighth bilateral summit in 20 months, Merkel has cited the need to prepare for the default that investors see as a sure thing. Sarkozy, whose banks have the most to lose, is unwilling to gamble on letting Greece go. “The whole German debate about a default of Greece is a German debate, not a European debate,” said Stefan Collignon, a former German Finance Ministry official and political economist at the Sant’Anna School of Advanced Studies in Pisa, Italy. “The commitment everywhere else, including in France, is very much to avoid that by all possible means.” The heads of Europe’s two biggest economies, along with their finance chiefs, meet in Berlin on Oct. 9 with the euro near a nine-month low against the dollar. French 10-year bonds yield 78 basis points more than their German equivalents, near the euro-era record set Aug. 8. Investors are demanding a premium of 21.4 percentage points to hold Greek 10-year bonds over benchmark German bunds of similar maturity. The leaders will discuss banks’ finances in their Berlin talks, Sarkozy told reporters in Yerevan, Armenia , declining to comment further on the crisis. Credit Ratings The leaders’ contrasting approaches on Greece may reflect the relative vulnerability of their top credit ratings and economies. France ’s AAA rating and its banks are on the front line of potential damage, while German exposure to Greek debt is smaller. Credit-default swaps on Germany have almost doubled this year to reach a high of 121 basis points Oct. 4. French CDS exceeded 200 basis points last month. Higher prices indicate greater risk. “Sarkozy is obviously the weaker partner,” Carsten Brzeski , an economist at ING Group in Brussels, said in a phone interview. Even so, “Merkel needs Sarkozy’s support on the debt restructuring issue, not necessarily that it’s going to happen now, but that it’s going to happen sometime.” Already the biggest contributor to bailouts for Greece, Ireland and Portugal, Merkel may not offer much in return when she hosts Sarkozy at the Chancellery. Last Resort She’s been stressing the limits of joint action, saying Oct. 5 that Europe’s rescue fund will only be used as a last resort to save banks and that investors may have to take deeper losses in a Greek rescue. Germany is also resisting discussion of leveraging the 440 billion-euro ($586 billion) fund to boost its firepower. European leaders are struggling to persuade investors they can stem the sovereign-debt woes as the crisis gnaws at the euro area’s core, prompting speculation of another government rescue of Dexia SA (DEXB) , the municipal lender bailed out by France and Belgium in 2008. Underscoring the risks, Moody’s Investors Service lowered Italy’s credit rating by three steps on Oct. 4 and warned that euro-area nations rated below the top Aaa level may have their rankings cut. Disagreements Since the crisis broke out in Greece in late 2009, Merkel and Sarkozy have differed on key points -- including the role of the International Monetary Fund in rescues, sanctions for countries that break deficit rules and how to make banks take losses to help rescue Greece -- before finding a way forward. Germany and France are at odds over whether the European Financial Stability Facility rescue fund should have limits on government bond purchases, Germany’s Handelsblatt newspaper reported today, citing an unidentified European Union diplomat. “Franco-German cooperation hasn’t worked well in terms of solving the crisis,” Paul De Grauwe, an economics professor at the Catholic University of Leuven in Belgium, said in a phone interview. “The two have pursued different objectives.” As German Finance Minister Wolfgang Schaeuble urges euro- area counterparts to develop individual plans to protect their nations’ banks, Merkel is laying out the scenario of Greece defaulting without leaving the currency union she has vowed to preserve. ‘Barrier’ Needed “We have to be able to put up a barrier,” she said on Sept. 26. “I don’t rule out at all that at some point we will have the question of whether one can do an insolvency of states just like with banks.” She raised the specter of running out of time, patience and money on Oct. 5, prodding other EU governments to figure out whether banks need capital boosts. “Time is short,” she said. In contrast, Sarkozy has referred to Europe as a “family” that must stick together to support its weakest members. After hosting Greek Prime Minister George Papandreou at his Elysee Palace on Sept. 30, Sarkozy rejected daring the markets with an insolvency. “The failure of Greece would be the failure of all of Europe,” Sarkozy told reporters. “Remember in 2008, when the U.S. let Lehman Brothers fail, the global financial system paid the price. For both economic reasons and moral reasons, we can’t let Greece fail.” Greek Holdings Sarkozy, whose popularity is near a record low as he decides whether to seek a second term next year, has reasons for concern. At the end of March, French financial firms had $672 billion in public and private debt in Greece, Portugal, Ireland, Italy and Spain , according to Basel, Switzerland-based Bank for International Settlements. That’s the biggest exposure to the euro-area’s troubled countries and almost a third more than German lenders. Bank of France Governor Christian Noyer said last month that French banks don’t need recapitalization as Societe Generale (GLE) SA, BNP Paribas SA and Credit Agricole SA (ACA) , the country’s largest lenders, have announced plans to reinforce their capital by cutting assets. Merkel, who faced down two junior parties in her government that flirted with anti-bailout stances, won a victory last week when her coalition’s lawmakers passed an expansion of the EFSF that allows it to buy sovereign bonds in the secondary market and recapitalize banks. Euro Stability Merkel signaled that Germany’s largesse is now exhausted, saying Oct. 5 that the rescue fund’s new powers must only be used if the “stability of the euro as a whole” is at risk. Merkel and Sarkozy issued coordinated statements on Sept. 14 after a three-way phone call with Papandreou, saying they are “convinced” Greece will stay in the euro area. In focusing on Greece, Europe’s leaders are “asking the wrong question,” Irish Finance Minister Michael Noonan said yesterday in a speech in Ireland’s upper house of parliament. Europe should recapitalize banks to build a “financial firewall against contagion,” tackle Greek debt and then sort matters of governance, he said. “The question is what should Europe do about the euro zone, and if you answer that question then Greece falls into context,” Noonan said. To contact the reporters on this story: James Hertling in Paris at jhertling@bloomberg.net ; Tony Czuczka in Berlin at aczuczka@bloomberg.net To contact the editor responsible for this story: Mark Gilbert at magilbert@bloomberg.net |
Berlusconi to Name Bank of Italy Nominee by November, Ansa Says.Prime Minister Silvio Berlusconi will decide on a candidate to replace Bank of Italy Governor Mario Draghi by Nov. 1, the premier told journalists in Rome today, news agency Ansa reported. Draghi succeeds Jean-Claude Trichet as head of the European Central Bank on Nov. 1. To contact the editor responsible for this story: Andrew Davis at abdavis@bloomberg.net |
Ex-Hansen Medical Sales Executives Face SEC Fraud Allegations.Former sales executives at Hansen Medical Inc. (HNSN) were accused of fraud by the U.S. Securities and Exchange Commission. To contact the reporter on this story: Karen Gullo in San Francisco at kgullo@bloomberg.net To contact the editor responsible for this story: Andrew Dunn at adunn8@bloomberg.net |
Steve Jobs's Bicycles for the Mind.Steve Jobs logged off too soon. He was a serial innovator whose illness cost the world a bright talent who was also a great company leader. I hope that the music from the hymns of praise sung to him in his waning days is playing on his iPod as he ascends into the firmament of the greatest American business leaders. If there were a Nobel prize for business, surely he would have won it. He did what he set out to do and more. He saw the potential for computing power for the masses, useful and accessible to everyone. In a phrase that drove the early Apple, he created bicycles for the mind. Jobs was all about mass personalization. The ubiquitous i of the iMac, iPhone, and iPad signaled individual as well as interactive in the user-friendly products he spawned. In democratizing a technical field, Steve Jobs was the Henry Ford of his time. He turned computers into consumer products affordable by billions. Apple wasn't the biggest company — although Jobs lived to see a glorious moment when Apple's market cap shot ahead of Exxon's to be number one. But Apple consistently pushed the industry to change, playing the role of feisty fresh-faced free thinker. Apple was always a counterculture challenging establishments and going for the future — like the early emphasis on getting Apples into classrooms to help kids learn. Jobs was a co-founder but emerged as the business as well as technical leader. He didn't put his name on the door, although the Macintosh was named after his favorite apple, and company style reflected his tastes. That was Apple round I. Jobs also had a comeback story rivaling any in business, a model for leadership development. He lured a former PepsiCo executive, John Scully, to the young Apple company, as his "adult supervision," only to find himself pushed out, in part due to excesses in the Mac division he headed. For a time it looked like Jobs was another faded icon, dabbling in a set of ventures hoping to recapture former glory or looking to prove Apple wrong. But he took advantage of opportunities, learned, and grew. He headed Pixar, a star in computer animation, and founded Next Computer. Next turned out to be his ticket back to Apple, when the underlying technology was sold to Apple. His leadership pause refreshed and broadened him. As CEO of Apple round II, Jobs built a bigger and even more innovative company and it soared. Under the mature Jobs, Apple now understood how to enlist developers and other partners. Job's new bite of the Apple created products and platforms that made the computer less important than the content. He led the company into devices of the future, grabbing initial leadership in smartphones, and perhaps saved the online music business in passing. Even the Apple-Microsoft rivalry reflected the kind of competition that spurs innovation. Jobs didn't start a dynasty, and he didn't take on world problems. He focused on Apple. He won't be known for the charitable foundations bearing his name or the good done afterwards but for the value created through new products during his lifetime. Jobs brought design from backroom to forethought, shook industry boundaries, challenged giants, and excited consumers. That is an enormous legacy that will stand the test of history. For more commentary on Steve Jobs, see our special section, The Legacy of Steve Jobs . |
France October Insee GDP Forecasts: Summary.Following is a summary of the October French GDP forecasts report from the French Statistics Office in Paris: To contact the reporter on this story: Barbara Sladkowska in Warsaw at bsladkowska@bloomberg.net To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net |
Mouchel Group Chief Executive Officer Richard Cuthbert Resigns.Mouchel Group Plc (MCHL) said Chief Executive Officer Richard Cuthbert resigned with immediate effect. Bo Lerenius becomes executive chairman until a new chief executive is appointed. To contact the editor responsible for this story: Peter Woodifield at pwoodifield@bloomberg.net |
Canada’s Aglukkaq Announces Plans to Regulate Energy Drinks.Canadian Health Minister Leona Aglukkaq said she is planning new regulations for energy drinks that will include nutritional labeling and limits on caffeine. Aglukkaq made the announcement today in Ottawa. To contact the reporter on this story: Theophilos Argitis in Ottawa at targitis@bloomberg.net To contact the editor responsible for this story: Paul Badertscher at pbadertscher@bloomberg.net |
TAIWAN DAYBOOK: September Trade; TSMC Revenue; Bills Auction.Taiwan’s year-on-year export growth may have accelerated to 9.6 percent last month from 7.2 percent in August, according to the median estimate of 16 economists surveyed by Bloomberg News. The island’s Ministry of Finance is scheduled to announce trade data, including imports and total balance, at 4 p.m. in Taipei today. To contact the editor responsible for this story: Joshua Fellman at jfellman@bloomberg.net |
Abu Dhabi’s Aldar Says Chief Financial Officer Malik Quit.Aldar Properties PJSC (ALDAR) , an Abu Dhabi developer that’s had three chief executive officers in four years, said Chief Financial Officer Shafqat Ali Malik resigned. Malik will continue in his role until the end of October, the company said in a statement to the Abu Dhabi bourse today. Aldar is in the process of selecting a replacement to Malik, who quit to “pursue other opportunities,” it said. Aldar, which is building thousands of homes and offices across the United Arab Emirates ’ capital Abu Dhabi, in January agreed to sell assets including a Ferrari theme park and convertible bonds to the Abu Dhabi government for 19.2 billion dirhams ($5.23 billion) to pay creditors. Property values and rents slumped in the U.A.E. after banks curtailed lending and speculators left the market during the global recession. Aldar reported a profit of 127.3 million dirhams in the second quarter after a loss of 475.3 million dirhams a year earlier. The shares have dropped 51 percent this year, compared with a 8.3 percent decline in the benchmark ADX General Index. (ADSMI) To contact the reporter on this story: Shaji Mathew in Dubai at shajimathew@bloomberg.net To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net |
Japan Aug. Workers’ Households High-Value Spending.Following is the detailed table for Japan ’s workers’ household spending for high-value products from the government’s statistics bureau in Tokyo. NOTE1: Figures are not seasonally adjusted. Total spending figures are calculated by Bloomberg News. NOTE2: Includes agricultural, forestry, and fisheries households. SOURCE: Ministry of Internal Affairs and Communications To contact the reporter on this story: Minh Bui in Tokyo at mbui@bloomberg.net To contact the editor responsible for this story: Marco Babic at mbabic@bloomberg.net |