economy business news4

Stocks have got additions in trading

2010-11-27T20:11:00.007+04:00

Investors have made significant additions to riskier assets signalled by signs of improvement in US economy.
The FTSE All world index summarises this.It is up by 0.01. The euro remains under pressure as currency bloc's financial worries going up. Recent data regarding US data regarding job market improvements
leading to consumer spending have much influenced stock additions.The evidence of US economy was shattered by Eurozone debt crisis.
Tensions in Korea and china's attempts to curb inflationary pressures are some concerns.
However the $600bn quantitative easing programme commenced by US federal reserve right now have
been remarkable.
US data have influenced Chinese stocks as it were gained.The Shanghai composite rose 1.3% with consumer goods performing well with the hopes of US demand.Hang sang was higher by 0.1%.
The S&P/ASX in Sydney closed up 0.2% as firmer commodities helped minor.Tokyo added 0.5%
as the softer tone to yen helped exporters pushing FTSE Asia -pacific index up 0.2%.
The FTSE Euro first 300 is up by 0.1% and London FTSE 100 is up 0.3%.

Gold price hits five-months high

2010-11-26T19:11:00.003+04:00

In the wake of sovereign debt crisis in Europe and tensions in Korean peninsula,gold price rising.
Spot gold gained 0.8% to $1,377.10 a troy ounce even as dollar rallied hard. Denominated in Euros,gold price jumped 2.7% to Euro 1,030.03 an ounce within the reach of all the time high of Euro1,050 touched in June. Gold coins and bars registered strong demand in europe leading to around 30% sales rise from the rate in November. An analyst at HSBC New York suggested that Eurozone debt crisis abating could not be visualised.
In other markets, agricultural commodities and metal enjoyed a small bounce. ICE march row sugar rose 1.1% to 27.63cents a pound.Copper in 3 months was 0.9% hogher at $8,224 a tonne.Losses in cotton snowballed as traders showed meagre interest in taking delivery next month.ICE DecemberCotton fell 10.90 cents to $1.11 per pound accelerating a reversal from its exchange record above $1.50 on Nove-9.Cotton has come under pressure as china has taken steps to curb inflationary pressures.China's two cotton textile mils have lowered procurement prices putting pressues on prices.

Dollar versus gold and vice versa

2010-10-29T19:19:00.001+04:00

Sterling hits the day's high against the dollar and the euro on octo.26 Tuesday after strong economic growth data and a vote of confidence in the Govt's management of economy.From the rating agency S&P the UK economy grow 0.8% in July-Sept.2010. It dampened the speculation that the Bank of England may soon
implement quantitative easing.
Euro- dipped 0.1% to $1.3945 after fully close above $1,400 on Monday (Octo.25).The euro has support
at around 1.3860 its low last Friday and 21st day moving average $1.3866.Macro funds had trimmed some
of their short dollar position as they waited to see how the G-20 currency debate shaped up.
Indian rupee- The Indian rupee eased on 26 Octo. tailing losses in the other Asian currencies and choppy
domestic share market that failed to provide direction.Coal India's $3,5billion Ipo power to price the issue
at the top of its range and building momentum for other state offers. The world's largest coal miner
would begin to refund excessive subscription for the IPO which had an instituional orders book of about $27
billion powered by foreign funds by late October or November and traders expect the rupee to weaken at
that time.

Gold edges lower as dollar stands firm

2010-10-29T18:23:00.001+04:00

Gold edged lower in Europe two days back as the dollar firmed a touch. But held near $1,340 an ounce as investers waited for US data on monetary easing in the US. The Federal reserve meeting could have signifi-
cant impact on dollar.The Federal reserve to discuss whether to extend its quantitative easing policy to accelerate growth.
Spot gold was bid at $1,335.17 an \ounce against $1,338.80 late on Monday.US gold futures for December delivery eased $3.30 an ounce to $1,335.50. In early days this month gold price hit $1,387.10
retreated as investors worried that they had too heavy priced in expected monetary easing from the Fed.
Gold typically falls as dollar rises and vice-versa with strength in the US unit curbing gold's appaeal as an
alternative asset and making dollar priced commodities more expensive for holders of other currencies.
The dollar firmed 0.2% against a basket of currencies on Tuesday as market participants ponders over
the quantitative easing the Fed would opt for. The dollar gained against Yen following remainders from Japanese officials about the possibility to curb Yen strength.The US currency against the euro struck below
$1.40 as market participants pondered over the monetay policy the Fed. would opt for

Euro at five months high against the dollar

2010-10-02T19:28:00.002+04:00

Currency analysis- The euro powered ahead fuelled by optimism in eurozone debt markets and by a significantly weaker dollar .As the Eurozone govts debt auctions continued last week euro outperformed strongly with the sale of 4 and 10 year bonds in Portugal. Even if the sale did not rise as expected, senti-
ments toward eurozone periphery continued well. The euro hit a five months high of $1.3411 as investors
considered a likelihood of and timing of first round of quantitative easing in the US.It was up 1% at 1.3396.
Following the weaking of dollar in recent sessions,it weakened by 0.3% to $1.5678 against pound and
0.6% to Y84.55 against the Yen. However the currency dollar strong against canadina dollar by 0.3% to
C1.0297 and the Australian dollar was flat at $0.9555.
The gain registered by euro against the dollar reveresed after two days due to concern about euro zone
banking sector. Valentin Marinov of Citibank pointed out that liquidity needs have grown of late May.
put pressure on Euro.Market analysis suggested that euro's recent rise against the dollar might further to
go. Data analysts further go to the fact that speculators were shifted to long position in the euro first time
from Dec-2009. The euro after hitting high of $1.3506 against dollar slashed to $1.3477 (down by 0.1%)
The euro also fell by 0.1% against Japanese Yen(Y113.49)and lost 0.3% to pound 0.8502.
The Swiss frank eased to 0.1% to Sfr 0. 09842against the dollar. This retreat came following swiss SNB's
comment that Swiss economy could see a slowdown.The Swiss National Bank forsees a deflationary
pressure in the coming year against that the euro is in the process of bottoming out against the swiss franc.

The recent price rise of food grains-an analysis

2010-08-11T19:43:00.002+04:00

The recent food crisis of 2007-08 and a following hike in the price of essential food crops affected countries of Asia and Africa.This was the highest in thirty years.It increased wheat price to an unprecedented level
that time.That food shortage occured due to bad food crops in countries like Australia,Canada and other parts of Europe.
Almost reminiscent of that event, there is a mild price increase happened for wheat price recently.It came upto $8 a bushek last week. But analysts does not see a chance of food crisis and a persistent rise in price
like that happended three years ago as world assumes a better position in terms of food shortage.Because of
US farmers has had enough stock of wheat(30m tons) and inventories of rice,corn and other commodities
are also at healthy label.Many observers don't see a possiblity of a price rise due to various factors at present.
Oil price less and less energy price can cause manure price cheaper.So farmers can increase food production.
the world's food grain stocks were at about 528m tonnes at much safe level compared to a situation
of 2007-08.
Experts opined that Govts might worsen the problem by imposing ban on exports and importers buy
more amount of food crops like the same happended 3 years back.
This rise in price of food grains came agaiist the backdrop of severe drought occured in Russia,Ukrain
and kazakhstan.
Three countries are world's top ten wheat exporters and key suppliers to countries in Middle East and Africa.
However,wheat price increased by 50% during the last two month's, even if food crisis is not severe
and it cannot be overruled. Analysts and traders observe a drop in production of wheat in Russia.
Also accompanied by, Kazakhstan and Ukrain may also produce less

car makers make buyont prospects in Europe

2010-07-18T20:38:00.001+04:00

European equities make rapid advancements in the gone week.This can make signalling device to US earnings. The FTSE Eurofirst -300 gained 1.9% to 1,045.47 its sixth consecutive advance as the index nearer to its mid-june high.German carmaker BMW jumped 8.3% to euro 42.13 after it released profit fore-
cast because of improved business conditions.Daimler climbed 5.4% to euro 42.81 while rival Volkswagen gained 5.2% to euro 77after JP morgan raised its price budget on the stock. Renault added 4.2% to euro 35.28 while Peugot rose to 5.3% to euro 24.37.Xetra Dax of Germany rose 1.9% to 6,191.13 as the inf-
luential Zew survey of German investment professional showed an increase in positive sentiment in its current
conditions index to 14.6points.After Zew data industrials rose-Man rose 3.6% to 74.95 euro Thyssenkurup
gained 3.5% to a 3 week high of 22.26pound. In sweden the OMX index soared 3% to 1061.10 after one
of the country's biggest bank -SEB beat profit forecast in the second quarter rising 4.9% to skr 48./75 .
Nordea Bank rose 3.8% to skr 72.50 while sweed bank added 4.4% to skr 82.25.Greece's Athens general
index surged 2.6% to 1,567.4 after the public management agency sold 1.63 billion euro of treasuries.
Sector bell wether ,Nation Bank of Greece added 4% to euro 10.24 .
In the property,Ireland's ISE index gained 2.2% to 2,963.06 as banking stocks rose.Allied Irish bank added
3.4% to euro 0.94 while Bank of Ireland rose to euro 0.76

Asian stocks rises to One month high

2010-06-18T19:02:00.003+04:00

Asian stocks rises to one month high- Strong technology stock drove rally in Asian market on before two days as last week's US consumer sentiment data fuelled optimism about the global recovery.
Tokyo led the region higher as the Nikkie 225 average climbed 1.8% to 9,879.85 with in sight of its 25day moving average.The indicator was last above its 25day moving average in late April.The broader topic index
gained 1.4% to 1.476 in shares. In the semiconductor sector,Advantest rose 2.1% to Y1,974 and Tokyo Electron added 1.3% to Y5,630.Other big experts got a boost from the weaker tone of the Yen against the
Euro. Sony gained 1.8% to Y2,618yen and Canon rose 1.6% to Y3,225 and Honda climbed 4% to Y2,711.Shipping lines also made hefty gains with Nippon yusen up 5.1% at Y351 and kawasaki kisen 4.1%
higher at Y380.
In the property sector ,Tokyo hand jumped 5.2% to Y347 and mitsubhishi Estate gained 2.2% to Y1,342 following positive broker comment on both stocks. Seoul pushed amid steady buying of technology and retailing stocks by foreign investors.The Kospi rose 0.9% 1,690.60 .Samsung electronics gained 1.3% to
won807.000 andHynix semiconductor added 0.8% to won 260.000.
LG display rose to 1.5% to won 41,750. Among the retailer Lottee shopping rose 0.9 to won349,500 and
shinsega added 1.5% to won 526,000.
Daewoo shipbuilding & Marine Engineering added 2.4% to won 19,100after it got an order from a Euro-
pean company.Tech stocks also gained ground in Taipi., with Taiwan semiconductor manufacturing up 1%
at T$61.10 higher at T$423.Cathay Financial rose 2.1% to T$46.65 and shin kong added 1.8% to T$11.05.
The weighted index rose 1.2% to 3week high of 7,387.40.
The Hang Sang index gained 0.9% to 20,051.91 while the index of China Enterprise stocks rose to 1.6%.
Optimism about the global recovery helped Esprit holidays, the Clothier group which makes more turnover
overseas climbed to 3.1% to Hk$45.65.Yeu Yuen industrial which make shoes rose 1.3% to HK$23.45.
Mumbai ended higher for fourth consecutive session led by 1.6% rise to Rs.1,063.4 for market heavy weight. Reliance industries,infosys technologies rose 4.3% to Rs.2,747.25 and rival software group Tata
consultancy added 2.9% to Rs.780.50.The BSE Sensex rose1.6% to17,338.17

Euro gains more in the midst of European debt crisis

2010-06-17T20:12:00.002+04:00

Global equity prices and the euro pressed higher two days before as investor confidence showed further signs of improvement. Despite there exists more stresses and strain facing the global economy strong demand at auction of Irish and spanish debt has caused to some extent the euro gain against the dollar and yen in currency markets. It gained high in two week's time.
Eure recovers as debt concern ease
Sterling gain after price inflation data help to ease concern about the outlook for inflation.The spanish government raised funds in open market was clearly a relief for the spanish and European policy makers.
Economic news from Germany received recently is also disappointing as per the europe's single currency.
A survey from ZEW economic think-tank indicate lowering investor confidence prompting concern over
peripheral debt vindicated core euro zone economies. Even if there is reason for panic the euro-zone bail
out package and ECB's latest measures to support bond and money markets had not been sufficient to
stabilise confidence in Germany.
The Euro inched higher against sterling although the pound gained stregth against the dollar as the more relaxed mood in the market over the eurozone sovereign debt outweighted tame consumer price data.
The Economic news got from the US is found to be hopeful for some reasons.
The Empire state manufacturing index inched higher to 19.6 this month -this point to an index of growth
in the factory sector.
A different data showed a sharp drop in US import prices last month- the combination of subdued inflation
coupled with moderate growth provided a positive backdrop for Wall street equities.
In New York the S&P 500 rose 2.4% while the Pan European FTSE Euro first 300 index gained 0.7%
The broad decline in risk aversion was further illustrated by 10% drop in the Vix volatility index to25.8.
However credit market seems to have failed in gain made by equities. Greek credit default swap spread
widened 45 basis points to 795 bp according to Markit data, with spanish,portugese spread also widening.
On the corporate side,the Markit Traxx Europe index widened 3bp to 129.5 bp.
In commodities the benchmark US oil price climbed back above $77 a barrel .The greek downgrade
put demand for gold and the metal pushed about $1.235 per ounce.
Eurozone investors fears a weaker economy- Despite global investor confidence in the region European
investors believe that their economy in ensuing year. A survey indicated that 19% global investors opined
that the euro would be up by the next year(7% in May). But with the eurozone investors slide to their
gloomiest outlook for more than a year.Just 7% of fund managers believe that it would be up by the next
year compared with 23% in May. Those who expect improvement in earnings over the year slumped to
20% from 74% in April. The investors are beignning to see the outlook behind 'euro' for Europe's upheaval.
The outlook for global economy is also not rosy regarding the next year.Only 24% of the respondents believe in the strengthier economy.Survey suggest buying opportunities good with 38%.Global growth
expectations have been down and positioning is more defensive.But investors shows no panic.

Euro gain more in eight months

2010-05-26T16:56:00.000+04:00

The euro rose against dollar in the last eight months amid speculation traders who bets on its decline amid
Europe's soverign debt crisis had to buy back the currency as it strenghtened to a one week high.
Yen - the yen gained against all of its 16 major counter as MSCI world index of shares traded near the lowest since August and Reuters/Jefferies CRB index of 19 raw materials fell for a fourth straight last week.
A tremendous amount of risk has been taken off the table following gained strength.
The euro rose1.7% the large gain since september to $1.2570 from $1.2358 on May 14. It fell to $1.2144
on May 19 before rebounding on May 23 to as much as $1.2672 the highest. The shared currency dropped
1.1% to 113.13yen,its fourth consecutive decline from 114.38.

Asian Stocks decline big in the One year

2010-05-26T16:33:00.002+04:00

Asian stocks fall last dragging down the MSCI Asia pacific index rights from 2009 January following US joblessness and concern over Europe's debt crisis.
Risk Appetite- Honda motor Co.- a Japanese carmaker sank 6.4% in Tokyo.
Esprit holding ltd- having vast base in Europe, a clothier slid 8.9% in Hong Kong.
Rio Tinto- Group a mining co. slumped 9.1% sydney as oil and metal price fell.
Sonic Health care Ltd.- fell 23% after cutting its profit forecast.
The MSCI Asia Pacific Index slipped 6.7% to 111.98 last week since Aug.2009
China's shanghai composite Index which entered a bear market as china increased steps to cool its property market sank 4.2% and Hong Kong's Hang Seng Index declines 3% in a holiday shortend week.
Japan's Nikke 225 stock average declined 6.5% over inflation fears.
Qantas Aiways Ltd- Australia's largest airline dropped 9.9% to A$2.38 in Sydney packing drops in consumer stocks.
Li and Fund ltd- the No.1 supplier for retailers slipped 2.3% to HK$34.35 in Hong Kong.
Stocks fall following US economic reports and a ban on naked short selling of certain securities imposed by Germany.

2010-04-21T20:06:00.010+04:00

The Central Bank of India raises interest rate while inflation soaring up.

Central Bank of India, called Reserve Bank of India might raise interest rate for the 2nd time in a month for the fastest rate of Inflation. The RBI will probably inccrease the reverse repuchase rate to 3.75% from 3.5%
and reparchase rate to 5.25% from 5%. according to the median forecast of 25 economists. Inadequate and
dialapidated roads and ports and insufficient capacity in power drive up prices. It increases the cost of trans-
port of raw materials for industrial production. Domestic demand pressure along with a rise in global comm-
odity price account for a spurt in inflation. The nation's wholesale price inflation rate held at a 1.7%, a month
high of 9.9% in March.
The RBI may raise the proportion of deposites that lenders needs to set aside as reserve ratio might go up
to 6% from 5.75%. India's $1.2 trillion economy may grow at 7.5% in 2010. the fastest pace after China
among the major economies.

India's rupee likely to strengthen- India Rupee likely to strengthen 3.2% in 3months as government

sales of stakes in state companies and relativelyhigh bond yields attract funds from abroad. The Deutsche
bank predicts the currency, has raisen 3.8% so far this year will climb to 43.2 per dollar. The Cenral Bank
may favour gains to make imports cheaper. The rupee slipped 0.6% from the end of last week to trade
at 44.58% per dollar in Mumbai, according to data compiled by bloomsberg. It reached 44.165 in Apr-15
Asia's 3rd largest economy plans to raise $8.9billion selling shares in state owned companies in the fiscal
year through March2011.
India's benchmark 10year bond yields 8.07%compared with 3.75 for similar maturity US debt and
1.34% for those in Japan. Overseas investors holding of Indian bonds have more than doubled in the
past years to a record $12.2billion according to securities and exchange boards of India. Net purchase
this year already total 4.8dollar billion, more than the combined inflow of 2008 and 2009.

Inflation data pushes pound higher

2010-04-21T19:31:00.002+04:00

sterling advanced on Tuesday stronger than expected. Inflation data raised the speculation that Bank of England would raise interest rate sooner.
UK consumer price inflation rose to 3.4% in March from 3% in February.
Japan's Nikkie average dipped 0.1% on Tuesday after its biggest percentage fall in two months.

The Nikkie spent much of the day in positive territory, initially getting some respite after Monday's
1.7% slide.But the rise came in low trading volume, a sign that bounce lacked momentum.

Gold price stable against the strong dollar

2010-04-11T19:25:00.004+04:00

Gold price stable while strong dollar offsets investors demand for hard assets-
Gold steadied in Europe before 2 days as the rising dollar offset buying linked to fear driven diversification
into hard assets like bullion.
Dealers reported good amount of gold buying from major market like India in recent session which also
supported price for other precious metals like palladium hitting a 2 year high and platinum its strongest price
in 20 months.
spot gold was bid at $1,133.85 an ounce against $1,133.2 late in NewYork on Tuesday. US gold futures
for June delivery on the convex division of New York Mercantile exchange eased $1.10 to 1,135.00 an
ounce.

2010-04-11T19:09:00.001+04:00

Oil falls for the second day against the dollar-
Us crude stock pile reach the highest level for nearly 10 months as imports surge. Oil declined for the 2nd day on April 9 towards $85 , a barrel pressured by strong dollar and rise in US crude stock piles to their
highest in 10 months. Greece financial crisis concerns affected market from commodities to equities over 2 days, boosting the value of dollar against the euro and major currencies. as investors seek safer assets. US
crude fell 47cents to $85.41 a barrel while brunt crude also fell 52 cents to $85.12. Oil in New York had
rallied to an 18months in Friday peak about $87 on Tuesday after a flurry of positive US economic indicators. The market had a strong pull over a few days owing to dollar went up. The US dollar climbed
more than 0.5% against a basket of currencies.A strong dollar markets dollar denominated curriencies such
as oil more expensive for holders of other currencies. US crude stocks rose last week to their highest level
nearly 10months as import surged.

Grey Market begins sale of ipads in China

2010-04-10T18:08:00.004+04:00

The Grey market started selling imported ipads at the start of this week.

The mainland china and Hong Kong have vibrant grey market where by consumer can buy parallel imports-shipments of legitimate goods not intended for that market-of most foreign goods products.When iphone parallel import started in

HongKong - in 2007 it was more than doubled than the then US retail price ($US 1300). But due to weaker demand and parallel import ipad is expected to be available in HongKong at lower price.One of the most popular grey market in Hong Kong selling 16 GB ipad -the cheapest model for about HK$5,900 (US$760) a premium of just over a half the US price of $500.The 32GB model sells about HK $7000 and the largest 64GB model cost about HK$12000, both selling roughly a $300 premium over US retail price. One major drawback for the HKG consumer is that ipad users can only input simplified Chinese characters instead of the complex versions of Chinese characters used in Hong
Kong and Taiwan.

Misys benefits from US health care reforms

2010-04-10T17:17:00.007+04:00

The passage of the US health care reform bill combined with Obama administration's $19bn stimulus package is boosting revenue at Misys which is gearing up to sell software for electronic patient records to US doctors surgeries.The health care business industry is the best industry right now. Misys, owns 57% of Allsripts, the US healthcare software company is expected to be a big beneficiary of stimulus package of which earmarked for helping doctors to modernise their patient recording systems. The growth of health care business us helping to offset declines in Misys's banking division which has been struggling to upgrade its software and win customers.
Revenue at Allscripts healthcare business was up 16% in 3rd quarter to the end of February, helping lift overall turnover at the company 7% on a constant basis to 192m pounds.

European central Bank holds interest rate at 1%

2010-04-10T17:00:00.000+04:00

Eurozone official interest rates have been left unchanged as the
ECB prepares its response to the crisis over Greece's public finance.
The ECB said it would stay at 1% for 11th consecutive month.

2010-03-21T18:59:00.003+04:00

Bonds analysis Emerging Markets has record of good start this year- Emerging markets have had their best start as issuance surged and yield narrowed to their tightest level over us treasurries Riskier assets such as emerging debt were helped by more stability in the European government fixed income market after Greece successfully issued bonds. Bryan Pascoe opined that risk appetite from emerging markets side stronger given the prevailing performance. Nigel Rendell, senior emerging markets strategist at RBC Capital Markets, said: “It is a good time for investors to take some profits and wait for a better time to buy as the market is almost certain to fall in the next few months.” Emerging market sovereign bonds deals have reached a record $127bn so far this year, a 36 per cent increase on last year – the previous record – according to Dealogic. The data provider has been tracking the sector since 1995. Developing world government bond yields for international deals, which are mostly priced in dollars, have been tightening since March last year, when sentiment started to improve on hopes of a global recovery. They have narrowed even more sharply in the past month. Emerging market bond yields narrowed to 254 basis points over US Treasuries on Friday, compared with 350bp only a month ago and a peak of 684bp in March last year, according to JPMorgan indices. Brazil, which has a strong economic story and is one of the more liquid emerging markets, has been one of the best performers. Average Brazilian bond yields in dollars are only 186bp over US Treasuries compared with 442bp this time last year, says JPMorgan. The local currency bond markets have also sharply outperformed developed world debt. For example, Indonesian five-year bonds are trading 596bp over US Treasuries compared with peaks of 1,074bp in March last year

2010-03-21T18:25:00.004+04:00

Equity anlysis-
Us stocks sets back in the midst of Global Financial Crisis Us stock pulled back on last Friday and investor worries over Greece's debt Crisis At the close. the S&P 500 was down 0.5 per cent at 1,159.89, but up 0.8 per cent on the week. On Tuesday, it broke through the 1,150 mark, a key technical level. The Nasdaq Composite was 0.7 per cent lower at 2,374.41, but 0.1 per cent higher since the start of the week. The Dow Jones Industrial Average was 0.4 per cent lower at 10,741.98, up 1 per cent on the week. The Dow had risen for eight consecutive sessions before its rally came to an end on Friday. The health insurance sector was in focus ahead of Sunday’s vote on the $960bn reform bill in the House of Representatives. Over the week, Cigna Corp strengthened 7.2 per cent to $37.08, Aetna was 7.6 per cent higher to $34.46 and UnitedHealth Group rose 4.5 per cent to $34.39. Google fell 1.1 per cent to $560 on Friday and 3.4 per cent over the week as speculation mounted that it was set to withdraw from China . Aircraft manufacturer Boeing, reversed mid-session gains to fall 0.2 per cent to $71.72 after saying it would ramp up production for its 777 and 747 airliners to help meet demand. Palm, a maker of smart-phones, on Friday lost 29.2 per cent to $4 after the company warned that it expected revenues in the current quarter to miss analysts’ estimates because of lacklustre demand for its latest products. The stock has fallen 40.9 per cent in the past 12 months. It was downgraded by at least five brokers. Peter Misek, technology analyst at Canaccord Adams, cut his price target from $4 to zero. “We believe Palm’s troubles will only accelerate as carriers and suppliers increasingly question the company’s solvency and withdraw their support,” he wrote in a note. Electronics retailer Best Buy rallied 1.3 per cent to $40.99 on Friday after the stock was upgraded by Goldman Sachs to “buy” from “neutral”, noting that the stock is trading at one of the lowest multiples in the US hardline retail sector, which excludes clothing. Nike rose 5 per cent to $73.52 over the week after the sportswear company reported strong third-quarter earnings that beat average analyst estimates. Net profits more than doubled and North America sales increased for the first time in four quarters. FedEx strengthened 5.1 per cent to $91.05 over the week after the package delivery group reported solid quarterly results. The company also raised its earnings forecasts. Teva Pharmaceuticals rallied 2.8 per cent to $63.03 during the week on news that the Israel-based generic drugs maker had bought Ratiopharm, Germany’s second-largest generic drugmaker, for €3.6bn ($4.9bn). Medical device maker Boston Scientific Corp gained 0.9 per cent to $7.13 on Friday after a regulatory panel backed its implanted cardiac device for use in patients in early stages of heart failure. The device still requires Food and Drug Administration approval. Lions Gate Entertainment increased 1 per cent to $6.03 on Friday as Carl Icahn launched a hostile bid for the film studio group, offering $6 per share. He currently owns about 20 per cent of the company.

Strong dollar could derail markets

2010-03-02T19:12:00.011+04:00

The dollar became the funding currency of choice as global asset markets recovered from the lows of March last year.Ulralow interest rates in the US encouraged carry trade investors to sell the dollar to finance the purchase of riskier assets. The Governor of people's Bank of china fears that carry trade might start to unwind pushing the dollar higher and derailing the rally in assets market that has accom- panied global economy's emergence from the financial crisis. Just as the Japanese Yen jumped higher following collapse of Lehman brothers in 2008, dollar is streng- thening. So assets such as commodities,equities and other higher yielding currencies sell off. The dollar has become the funding currency as global assets markets recovered from their post-crisis lows from 2009 March.This was because ultra low rate of interest in the US encouraged carry trade investors to sell the dollar to finance the purchase of riskier, high yielding assets. The result was that the currency fell by 17% on a trade weight basis. Since Dec-2009,the currency has risen more than 8% on a trade weighted basis. Speculative data Analyst say that there is evidence outside short-term speculative data that investors have build significant long positive strides in dollar. Further more they say the dollar is unlikely to lose its status as a funding currency desoite the federal reserve's decision to raise the discount rate. John Normal at Jpmorgan says concerns about soverign risk issues in Europe and surprising actions of other central bank have boosted the dollar over a few weeks before. The Reserve bank of Australia failed to raise interest rate this month while the bank of England announced its willingness to extend quantitative easing. This has contributed to dollar strength. Therefore it could be concluded that a dollar could not be moved to an investment currency from a funding currency follow- ing a global tighening

Emerging markets strikes optimism

2010-03-01T19:18:00.014+04:00

The MCSI world index of 23 developed nations added 0.4% in early New York trade,while Emerging Markets gauge advanced 1%.Futures on the standard&poor's500 index swung between gains and losses as Americal International's Group bigger than forecast qua- rterly loss overshadowed an expansion in gross domestic product that beats estimates. Britain emerged from recession at a faster pace than previously estimated in the 4th quarter. The economy expanded 5.9% in the 4th quarter of 2009. 'The emerging markets are a strong story' says Ganske, head of Commerz bank AG in London. The movement is a reaction to the market being depressed over the past couple of days. We are facing a period of higher volatility rather than a long-term, sustained rally". Europe's Dow Jones stock climbed 0.5% as all but 3 out of 19 industry group advanced Saint-gobain Europe's biggest suppliers of building materials surged 7.5%. Rio tinto Group led in mining companies rallying 2.6% in London The MSCI Asia pacific index advanced 0.6% capping its biggest weekly gain in six weeks. Woolworths-Australia's biggest retailer, climbed 5.5% in Sydney as it announced a share buyback. India's sensitive index advanced 2.5% in two months.Emerging Market stock gain were packed by a 0.8% advanced in Turkey's ISE 100 index. Greece's ASE Index rallied 1.9%. The dollar and yen fell against most of their counterparts as signs of global economic recovery and gain in global equities encouraged demand for higher yeilding assets. The dollar declined 0.1% to $1.3560 per Euro early in New York in Feb-26 from Feb-25. It reached $1.3444 on Feb-19, the strongest level since may 18,2009. The yen traded at 120.83 per Euro from 120.69 in Feb.25 when it advanced to 119.66 the strongest since Feb-24,2009. Gold climbs above $1,108 as dollar slips Gold price rose on Feb-26, yesterday, supported a rebound in euro versus the dollar after the previous sessions weakness. spot gold was bid at $1,108 an ounce at 1313GMT against $1,104.7 late in New York on Feb-25. The precious metal has gyrated within a range of around $1,075-1,130 from the last two weeks. Yesterday the euro's rebound from the near nine months low against the dollar in the previous session supported gold,but many expect the currency to stay under pressure. Oil rises towards $79 after US GDP data Following an upward revision in US GDP oil rose to $79 a barrel. The 5.7% growth registered in US maintained a higher level of 5.9% this year start.Rising expect- ations for final demand in the world's top energy consumer. US crude for April delivery rose 74 cents to $78.91 a barrel on Feb-25.Price earlier rose more than $1 to a high of $79.34 a barrel.

2010-02-01T16:38:00.008+04:00

The US-based financial services major Morgan Stanley plans to hire several hundred traders over the next few years in an effort to boost its under performing securities business, says a media report.

Attributing to Morgan Stanley CEO James Gorman, the report by the 'Financial Times' said that the company plans to boost its under-performing securities business by hiring several hundred traders over the next few years.

The securities business is crucial to Gorman's strategy of reviving Morgan Stanley's fortunes after a loss-making 2009 by marrying a strong investment bank with a large US retail brokerage operation, the report noted.

Gorman, who took over as CEO from John Mack in January, told that that Morgan Stanley's sales and trading unit had failed to reach many of the investors and companies who wanted to do business with the bank. “We need to seriously grow our footprint in products like currencies, equity derivatives, and commodities. We could easily be 25 per cent bigger than we are. (Investors') bias is to do more business with us, the burden is on us to deliver”, Gorman said

2010-01-31T20:23:00.007+04:00

US economy grows 5.7%

Exceeds expectations of analysts Bloomberg Published: 00:00 January 30, 2010 Washington: The economy in the US expanded in the fourth quarter at the fastest pace in six years as factories cranked up assembly lines and companies increased investment in equipment and software.
The 5.7 per cent increase in gross domestic product, which exceeded the median forecast of economists surveyed by Bloomberg News, marked the best performance since the third quarter of 2003, figures from the Commerce Department showed on Thursday in Washington. Efforts to rebuild depleted inventories contributed 3.4 percentage points to GDP, the most in two decades.
Manufacturers such as Intel Corp may keep leading the recovery as increasing sales prompt companies to restock. A slowdown in consumer spending last quarter is a reminder that 10 per cent unemployment is causing Americans to hold back, one reason why the Federal Reserve is keeping interest rates low and the Obama administration is proposing new plans to create jobs.

Stocks rose after the report. The Standard & Poor's 500 Index climbed 1 per cent to 1,094.90 at 10.23am in New York. Treasuries dropped, pushing the yield on the benchmark 10-year note up to 3.68 per cent from 3.64 per cent late yesterday.

Private reports released on Thursday showed confidence among US consumers improved in January for a second month, and companies expanded this month at the fastest pace in more than four years as orders and employment increased.

The economy was forecast to grow at a 4.7 per cent annual pace, according to the median estimate of 84 economists in a Bloomberg News survey. Estimates ranged from gains of 3 per cent to 7.5 per cent.

Consumer spending, which comprises about 70 per cent of the economy, rose at a 2 per cent pace, more than anticipated following a 2.8 per cent increase in the previous three months. Economists projected a 1.8 per cent gain, according to the survey median.

Emerging Markets will drive Global mergers

2010-01-31T20:03:00.010+04:00

Bloomberg Published: 00:00 January 31, 2010 Davos: Companies based in emerging markets will probably drive global mergers and acquisitions, as countries such as Brazil, India and China fuel economic growth, said bankers in Davos. "There will be a lot of corporate finance and M&A coming out of emerging markets," said Sadeq Sayeed, Nomura Holdings Inc's European chief, at the annual meeting of the World Economic Forum. "Capital and savings ratios in Asia are so great, and to grow there is a need for countries like India to have Western-style governance and accountancy, and that means there will be more acquisitions." Decline While takeovers in regions including Asia, eastern Europe and South America have declined by 17 per cent to $743 billion (Dh2.72 trillion) over the past 12 months, the drop wasn't nearly as steep as in Europe and North America, according to data compiled by Bloomberg. Those regions had a combined decline of 34 per cent. "Near-term secular growth doesn't exist in the developed economies, so more of the activity, both target and acquirer, will likely occur" in Brazil, Russia, India and China, said Peter Weinberg, a founding partner of New York-based investment bank Perella Weinberg Partners LP. BP Plc, based in London, is interested in acquiring assets in Brazil and is working with China Petrochemical Corp. to expand in Asia, Chief Executive Officer Tony Hayward said yesterday in Davos. Carlyle Group co-founder David Rubenstein on January 27 said emerging markets are the best place to invest as their economies grow faster than the developed world. Rebound "Emerging markets are the most attractive places to invest and are rebounding more rapidly," Rubenstein said, referring to China, India and Brazil, South Korea and Turkey. "We'll see lots of capital going into these countries." The International Monetary Fund this week said the global economy this year will be stronger than it previously forecast, driven by emerging markets. Emerging and developing economies will grow 6 per cent this year, almost triple the 2.1 per cent pace forecast for advanced economies, the IMF predicted January 26. Companies have disclosed an increase in transactions of about 22 per cent over the past two months as firms revive deals that were shelved or postponed during the credit crunch.