jueves, 15 de diciembre de 2011


Euro bounces from 11-month low

Dec 15 2011 18:40
New York - The euro bounced from an 11-month low against the dollar on Thursday as a successful Spanish debt auction and strong U.S. data whetted risk appetite, a trend some say may prove fleeting.
The euro jumped to a global session high of $1.3049 after data showed new applications for U.S. unemployment insurance fell to a 3-1/2 year low, suggesting the job market’s recovery was gaining speed. Solid U.S. manufacturing data and a rise in factory activity in the Mid-Atlantic to its highest since April increased investors’ appetite for riskier assets.

The deluge of U.S. data offered further proof of increased momentum in the pace of economic activity and provided a stark contrast to Europe, where the festering debt crisis has already pushed some economies into recession.

Indeed, while flash euro-zone PMI surveys on Thursday showed the decline in the private sector eased a little this month, a recession still looks inevitable with the region’s periphery struggling badly.
The common currency drew some comfort from a successful Spanish bond auction . The Spanish sale came a day after another auction where Italy had to pay a hefty 6.47 percent to borrow over the same period.
Generally quiet markets gave investors an excuse to book some profits on the single currency’s drop of about 3 percent against the greenback this week, according to Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington.
“While additional near-term upside for the euro is likely to result from continued profit taking and positioning, its medium-term downtrend remains firmly intact,” he said. “Euro losses are likely to accelerate in the event of a mass downgrade of euro- zone states by credit rating agencies, a scenario that looks increasingly likely, given the lack of progress at last week’s EU summit.”

The euro was last up 0.2 percent against the dollar at $1.3008, taking a breather from a massive sell-off earlier this week that saw it drop to $1.2945 on Wednesday, the lowest level since Jan. 11, on trading platform EBS. The next major support is at the year’s low, $1.2860, hit on Jan. 10.
The single currency, meanwhile , fell against the Swiss franc after the Swiss National Bank kept its floor on the euro/franc exchange rate unchanged at 1.20 francs. That disappointed some investors who had built long euro positions on expectations that the SNB would lift the floor to fight deflation in Switzerland.
The euro last traded down 0.9 percent at 1.2264 Swiss francs while the dollar traded 1.2 percent lower against the franc at 0.9414 francs.
The single currency has lost about 3 percent against the dollar this week after last Friday’s European Union summit, seen as crucial to reining in the debt crisis, failed to come up with near-term solutions to restore investor confidence.
“Overall, the outlook for the euro remains dark, with the unraveling of the treaty last week, refusal to lend to the IMF and the overall downside risks to global growth,” said Paul Robson, currency strategist at RBS Global Banking. “We expect the euro to fall to $1.26 by the end of Q1 next year.”
The euro’s weakness, plus sharp drops in the prices of commodities such as gold and persistent strains in dollar funding markets, have helped lift the dollar index close to its 2011 high. The index was last down 0.2 percent at 80.416 as investors booked profits on long dollar positions.
The euro remains highly vulnerable as the risk of sovereign downgrades also looms large for the region and investors fear some member states may develop cold feet with regard to the proposals on tighter fiscal rules that were the centerpiece of last week’s summit.
Against the yen, the dollar, meanwhile, eased 0.3 percent to 77.84 yen.

This is money

'Cheaper to rent than buy in 47 out of 50 British towns'

By Andrew Oxlade  14th December 2011

Renting a home is cheaper than buying in just three of Britain's 50 biggest towns and cities, according to a new study.
The findings highlight the stark injustice and worsening situation for millions of people priced out of the property market.
A year ago, it was only cheaper to buy in 40 out of 50 towns.
As the banking industry, rocked by the financial crisis, has tightened lending criteria on mortgages and demanded bigger deposits, it has left many more would-be first-time buyers stuck on the sidelines.
This has forced many more people to rent rather than buy, and spurred landlords to cash in on the rising demand and charge tenants more.
Average rents have been on the rise for most of 2010 and 2011.
Meanwhile the UK bank rate has been pinned down to 0.5 per cent for nearly three years, keeping mortgage repayments exceptionally cheap for those already on the property ladder.
Swansea, Plymouth and Bournemouth are the only three locations included in the study where renting works out cheaper than buying a property, according to the study by property website Zoopla.
Milton Keynes was named as the place where buying a home was the most cost-effective compared with renting, with renting being 36% more expensive than owning, leaving renters typically £2,436 a year worse off. In London, renting is 31% more expensive than the cost of ownership, leaving renters paying £6,888 annually on average compared with owners.
Nicholas Leeming, business development director at Zoopla.co.uk, said: 'The shortage of financing, especially for first-time buyers, has pushed demand for rental property through the roof.
'But for those lucky enough to be in a position to get a mortgage, there may never be a better time to buy.'
However, any rise in interest rates or a fully-blown second credit crunch  could rapidly and dramatically alter the affordability of UK property, sending mortgage repayments soaring for new borrowers in particular.
Markets currently predict no rise in the UK base rate until 2015 but the best rates on mortgage trackers have risen in recent months in reaction to the worsening situation in the eurozone, which threatens another banking crisis.
Britain's record low interest rates has been largely only of benefit to those already sitting on substantial amounts of equity in their homes and therefore able to offer up the typical 25 per cent to 40 per cent deposits needed to get the best deals when remortgaging.
For some, they have enjoyed dirt-cheap credit even without substantial equity. If they took one of the overly generous deals on offer in the credit boom - mortgages that track the base rate with only a slim premium were not uncommon - they might today still be paying between 0.5 per cent and 1.0 per cent.
And those who borrowed from Nationwide Building Society before the spring of 2009 continue to benefit from the lender's pledge to only charge 2 per cent above base rate, leaving hundreds of thousands of borrowers paying just 2.5 per cent.
Nationwide's standard variable rate for customers who have joined it since then is 3.99 per cent.
Zoopla based its research on buying a two-bedroom flat paying a rate of 5 per cent but taking an 'interest-only' deal, which is significantly cheaper than a 'repayment deal', and offering no deposit. It says these were the best assumptions to give a fair comparison for the real cost of finance.

The Register

Facebook won't deny it is sitting on huge mountain of cash

Facebook has declined to comment on a report that suggested the dominant social network had already tucked away sales of $2.5bn for the first nine months of 2011.
Gawker, citing a "well-placed" source, claimed to have its hands on juicy financial details about the privately-held company that is expected to go public next year.
A Facebook spokeswoman told The Register "No comment, as it relates to revenue."
If the numbers are accurate, then they paint a good picture of just how much money CEO and co-founder Mark Zuckerberg is sitting on right about now.
Here's Gawker's breakdown for the period covering January 2011 to September 2011:
Assets: $5.6 billion
Cash/cash equivalents: $3.5bn
Debt: $0
Shareholder equity: $4.5bn
Operating cashflow: $1bn
Revenue: $2.5bn
Operating income: $1.2bn
Net income: $714m
The same report echoed earlier suggestions that Facebook was looking to raise $10bn at a $100bn valuation in an initial public offering.
That private treasure trove, again if correct, is impressive. But some observers had estimated that Facebook could hit revenue of $4bn for 2011, a goal that may have now been missed, unless - that is - the company manages to pull in sales of $1.5bn during its final quarter.
Another interesting nugget apparently leaked by the anonymous source to Gawker appears to reveal exactly how Facebook's ownership is currently carved up.
Zuckerberg owns 24 per cent of the network he helped build from his college dorm in Harvard.
Among others, Facebook employees have a 30 per cent slice of the pie, serial Web2.0 investor Digital Sky Technologies owns 10 per cent, and Microsoft has 1.3 per cent ownership of the network.
Earlier today, the company debuted a major makeover of Facebook by introducing its Timeline feature. The network certainly appears to be priming itself for a very public showtime in 2012


Spain demands EU compensation in fishing row

15 December 2011, 16:41 CET

(BRUSSELS) - Spain said Thursday it will ask for compensation from the EU after the European Parliament cancelled a deal giving its trawlers special access to fish in Moroccan waters.
"I am going to ask for compensation for the damage to Spain's fishing fleet," said Spain's Farm, Environment and Fisheries Minister Rosa Aguilar, who was in Brussels for talks.
The lawmakers blocked the extension by 12 months of controversial special access for EU fishermen to Moroccan waters, until the interests of disputed Western Sahara are taken on board.
Opponents of the deal, which had mainly benefitted Spanish fishermen, have long argued that Morocco has no claim to waters off the disputed region and that aid to Morocco does not find its way to Western Saharans.
Morocco annexed Western Sahara in 1976 after a Spanish withdrawal, and Polisario fighters took up arms for an independent state.
The UN brokered a ceasefire in 1991 but a promised self-determination referendum has never been held.
The blockage of the deal, which provided for annual payments to Rabat, prompted the North African nation to immediately ban all European fishing boats.
"We will defend our fleet and the men now without work," said Aguilar.
She said all Spanish fishing boats had headed back to port to comply with the ban. "This is going to cause major harm to the Spanish fleet, which is mainly from Andalucia and the Canaries," she told reporters.
"We are talking about a fleet of about 70 boats and more than 500 direct jobs that will be affected."
The motion in parliament, passed by 326 votes to 296, was taken on the eve of talks between European Union fisheries ministers in Brussels, set to agree quotas for the Atlantic, North and Baltic Seas as well as the Mediterranean.
The EU's 27 states had agreed in July to extend an agreement allowing their boats to fish more off Morocco in exchange for funding, which campaigners say breaches international law regarding the people of Western Sahara.
Under the deal, Morocco would have received 36.1 million euros ($46 million) to let some 120 fishing boats, mainly from Spain, operate in its waters.
Finnish liberal MEP Carl Haglund said that payments already made were "a waste of taxpayers' funds" with no environmental benefit and no economic impact either to the EU or Morocco.
"Financial support for the development of local fisheries must be used properly and more efficiently while monitoring of where the money goes must be improved," the parliament said.
MEPs also "called on the Commission to ensure that a new protocol fully respects international law and benefits all affected local populations, including the Sahrawi people," a parliament statement said.
Spain's Aguilar said "I respect the decision but I'm not supporting it."
"I am going to ask for negotiations to be started up again," she added as she went into talks with counterparts.
Morocco's fisheries minister, Aziz Akhannouch, said in a statement on Thursday that the EU parliament's move had "very negative consequences for the relationship between the EU and Morocco".
But he added that "rather than a threat looming over the industry, this is an opportunity," according to news agency MAP.
"We have our own means of developing the sector. We have a lot of professionals who want to fish this resource and develop it to benefit Morocco."

Hong Kong Finances

HK checks on China’s Support Measures

Hong October 31, 2011 • 11:19 pm

Kong’s Financial Secretary John Tsang has concluded his trip to Beijing. As a result of the visit, he has confirmed that he had held solid discussions with relevant bodies in Mainland China to follow up on the policies and measures set out by Vice Premier Li Keqiang in August 2011. The measures are aimed at supporting Hong Kong’s development.
A large number of the measures are related to the financial sphere, which reflects the support of the Chinese government to strengthen the position of Hong Kong as an international financial centre, by expanding the cross-boundary use of the renminbi (RMB). According to Tsang, all Chinese bureaus and departments have been actively studying the Vice Premier’s policies, and they are expected to be implemented soon.
During Tsang’s meeting with China Securities Regulatory Commission Chairman, Shang Fulin, both parties discussed the progress in launching a Hong Kong exchange-traded fund (ETF) on the Mainland market. The Commission has entered the final stage of establishing ETF trading methods and management, so Tsang hopes that the details will be announced soon.
Tsang confirmed that China was finalizing the technical details of how to allow investments in the Mainland’s equity market by means of the RMB Qualified Foreign Institutional Investor scheme. He noted that he had received positive feedback from the State Council’s State-owned Assets Supervision & Administration Commission on the encouraging of state-owned enterprises to set up listed branches in the jurisdiction.
Also, Hong Kong will work closely with the Ministry of Commerce and the People’s Bank of China with a view to ensure smooth implementation of the managing of foreign direct investment from Hong Kong enterprises on the Mainland. To promote the initiative, officials from the Ministry and the Bank will be invited to Hong Kong.

Business World

Ayala firms up road foray 

 December 15, 2011 11:46:13 PM

AYALA CORP. outbid a San Miguel Corp.-led consortium for the contract to build, operate and maintain the 4-kilometer Daang Hari-South Luzon Expressway (SLEx) Link Road, with just a final evaluation left to hurdle before the first public-private partnership (PPP) project under the current government is awarded, officials said on Thursday.

The country’s oldest conglomerate, whose core business lies in real estate, banking and telecommunications, is thus poised to firm up its foray into road infrastructure along with its venture into power generation.
“Ayala [Corp.] submitted the winning bid of P902 million versus South Expressway Link [Consortium’s] P608 million,” Rogelio L. Singson, secretary of the Department of Public Works and Highways (DPWH), said via text.
DPWH Director Rebecca T. Garsuta said separately by phone that the government had set a P371-million floor price, representing reimbursement of its “initial investment” in the project.
South Expressway Link Consortium -- consisting of San Miguel Corp.’s Optimal Infrastructure Development, Inc., Star Infrastructure Development Corp. and CLGP Philippine Holdings, Inc. of the Citra group -- and Ayala had been the only bidders for the PPP deal.
DPWH said in a statement yesterday the notice of award will be issued on Dec. 22, following post-evaluation and qualification of Ayala’s bid.
“If Ayala fails to meet any of the requirements or conditions, it will be post-disqualified [sic] and the [DPWH Special Bids and Awards Committee] will conduct the post-qualification on South Express Link [Consortium],” the department said in its statement.
The Daang Hari-SLEX Link Road is a 4 km, four-lane thoroughfare that will connect Bacoor, Cavite to SLEx near the Susana Heights interchange in Muntinlupa City.
The project, involving a 30-year contract for financing, design, construction, operation and maintenance (O&M), will have an initial toll rate of P17 for Class 1 vehicles (jeepneys, pickup trucks, vans and cars), P34 for Class 2 vehicles (light trucks and buses), and P51 for Class 3 vehicles (trailers and large trucks), both DPWH and Ayala said in their separate releases on Thursday.
This is Ayala’s first toll road project which, the firm said further in its statement, will complement its property projects in Cavite and in Muntinlupa City.
“This is a good initial foray in the transport infrastructure space and we believe this successful experience working within a public-private partnership framework would be helpful in pursuing future projects under the PPP program,” the statement quoted Fernando Zobel de Ayala, Ayala Corp.’s president and chief operating officer, as saying.
“This road project provides significant opportunities for synergies within the Ayala group, especially our real estate group, Ayala Land, Inc., as it cuts travel time to our residential and commercial projects in this rapidly growing part of the metropolis.”
The firm sees the project as a “long-term investment” that will complement other segments of the group, John Eric T. Francia, Ayala Corp.’s managing director, told reporters in a briefing yesterday.
The Daang Hari-SLEX Link Road will pass near Ayala Land’s Avida Settings Cavite, Southvale Solnera, Verdana Homes Mamplasan, Amaia Scapes, and various Ayala malls, among others, Mr. Francia noted.
Ayala said in its statement that it will pursue the project through a partnership with Spanish firm Getinsa, which has experience in toll road projects in Spain, other parts of Europe, Latin America and in Asia.
In his briefing yesterday, Mr. Francia said the firm expects to sign the concession agreement in January, with a detailed design to be drafted within four months afterwards. The government is also expected to complete right-of-way acquisition for the project within six months from signing of the agreement, he added.
“As soon as the government delivers right-of-way acquisitions [sic], Ayala plans to begin construction by July 2012,” Mr. Francia said.
“By the second half of 2013, [the road] will be operational.”
Mr. Francia said the firm expects to invest “north of P2 billion” for the toll road project.
“We have the flexibility of funding [the project] through equity; maybe have the option of taking in bank financing,” Mr. Francia said.
“But there’s a good chance we will use our cash for this.”
Ayala is also looking at other toll roads in the government’s PPP list, he added, such as the P10.6-billion Ninoy Aquino International Airport Expressway and the North Luzon Expressway-SLEx Connector Road, for which Metro Pacific Investments Corp. has submitted a P21-billion unsolicited bid, that could be rolled out in the first quarter of 2012.
Moreover, Ayala Land is eyeing a bid for the Laguindingan Airport O&M deal, Mr. Francia said.
The government last month said it aims to auction off 15 PPP projects next year.
Sought for comment, San Miguel President Ramon S. Ang said via text, “Congratulations to them (Ayala Corp.)”
Ayala Corp. shares closed 1.43% or P4.20 higher at P297 apiece yesterday, while those of San Miguel closed 0.678% or P0.80 higher at P118.80 per share.

China Business News

Kazakhstan’s 3rd gold refinery will have capacity to produce 25/t of bullion per year 

November 13, 2011

Kazakhstan plans to begin construction of a third gold refinery next year to process an expected increase in volumes of the precious metal, the country’s Industry Ministry said on Monday.
State miner Tau-Ken Samruk will run the refinery, which will have capacity to produce 25 tonnes of bullion per year and could cost up to $30 million to build, the ministry’s committee of industry told Reuters in a written reply to questions.
Kazakhstan, Central Asia’s largest economy, has ambitious plans to raise annual gold output to 70 tonnes or more by 2015. It produced 27.5 tonnes of gold in the first nine months of 2011, including 12.5 tonnes of refined gold, official data show.
The central bank has committed to augment its gold reserves and ease exposure to the dollar by purchasing Kazakhstan’s entire bullion output from next year until at least 2014 or 2015.
There are currently two gold refineries in Kazakhstan. One, operated by Glencore-owned miner Kazzinc, refines ingot to international standards. Copper miner Kazakhmys refines gold to meet Kazakhstan’s domestic standards.
The committee said that Tau-Ken Samruk, the mining arm of sovereign wealth fund Samruk-Kazyna, was planning an investment programme to build the refinery and supply all of the necessary raw materials.