Tuesday June 30, 2009

KARACHI: Slight improvement was seen on the interbank market on Monday as the rupee gained five paisa against dollar for buying and selling at 81.40 and 81.45, experts said. In the first Asian trading day dollar regained some ground after falling broadly late last week on a renewed call by China for a super-sovereign reserve currency, placing higher-risk currencies such as the Australian dollar under pressure.

But activity was subdued ahead of significant data this week, including US employment numbers on Thursday, which investors are awaiting to see if a months-long rally in riskier assets such as commodity-linked currencies and shares is sustainable.

Open Market Rates: The rupee showed no change against dollar for buying at 81.50 and selling at 81.60, they said. The rupee, however, gained 80 paisa versus euro for buying at Rs 112.70 and rose by 30 paisa for selling at Rs 113.70, they said.

Buying Rs 81.40
Selling Rs.81.45

Interbank Closing Rates: Interbank Closing Rates For Dollar On Monday.

Open Buying Rs.81.50
Open Selling Rs.81.60


(BRecorder)

• 0 comments »

Tuesday June 30, 2009

LONDON: Bank-to-bank lending rates for euro funds extended their decline on Monday and are set to remain low as the market is awash with liquidity following the European Central Bank's massive injection of one-year funds last week.

Highlighting the abundance of liquidity, commercial banks deposited 236.2 billion euros at the ECB's overnight vault - the most since January 19 - latest data showed, and well above the 7.4 billion euros banks had deposited before taking delivery of last week's record cash injection.

"What the deposit spike means is that banks are filling up with liquidity now. It's not a fear factor so much as excess liquidity," said David Keeble, global head of interest rate strategy at Calyon in London. The three-month London interbank offered rate was fixed at 1.10625 percent - the lowest on record. The equivalent dollar and sterling rates also hit fresh lows.

This followed a drop in the three-month Euribor rate, traditionally the main gauge of interbank euro lending, to a fresh all-time trough of 1.108 percent. At the very short end, the Euro overnight index average, a weighted average of all overnight unsecured lending in the interbank market, was last fixed at a record low of 0.388 percent.

The one-week refinancing operation on Tuesday will be closely watched. Last week, ahead of the one-year tender, banks borrowed just 167.902 billion euros of one-week funds from the ECB, compared with 309.621 billion euros previously.

The ECB lent 1,121 banks 442 billion euros of one-year funds at a 1 percent rate last week at its first 12-month refinancing operation, aimed at spurring lending and boosting the economy. Analysts said whether the ECB will deliver any more measures to boost the economy remains to be seen.

Dollar Libor rates were also mostly down with the three-month at a record low of 0.59688 percent. In Asia, Hong Kong interbank lending rates fell after the HKMA intervened to back the territory's currency peg by injecting cash into the money markets. The overnight HIBOR was fixed at 0.05000 percent, below Friday's 0.06929 percent and the 1-month HIBOR eased to 0.10214 percent from 0.11214 percent.

(Reuters)

• 0 comments »

Tuesday June 30, 2009

WASHINGTON: The World Bank sees few signs of a positive trend in how people are governed, according to its annual report Monday on the quality of the world's ruling classes. The development bank's report also warned that a devastating financial crisis had exposed weaknesses in wealthier countries, which have "plenty of room for improvement" in how they govern their people.

Emerging countries including Chile, Botswana, the Baltic states and many Eastern European countries scored better than industrialised nations like Greece and Italy. "We should not presume that rich and powerful countries have the very best levels of governance and corruption control," said Daniel Kaufmann, a fellow at the Brookings Institution who co-authored the report. "The financial crisis reminds us that the quality of governance in G8 countries is not always exemplary."

Members of the Group of Eight (G8) - a bloc of leading industrialised countries - have been at the centre of a banking crisis that has spread to all corners of the globe. The World Bank also warned that governance in many countries has worsened over the last year. The report singled out Zimbabwe, Venezuela, Belarus, Cote d'Ivoire and Eritrea.


(DPA)

• 0 comments »

Tuesday June 30, 2009

BRUSSELS: Eurozone economic sentiment improved more than expected in June, data showed on Monday, as the European Commission predicted the worst could be over for the 16-country currency area. A monthly survey by the Commission, the European Union's executive arm, showed economic sentiment in the eurozone rose to 73.3 points in June from 70.2 in May, the third improvement from a trough of 64.6 points in March.

In a separate, quarterly report, the Commission said the worst may be over for the eurozone, although growing unemployment posed a threat to recovery. "The worst seems to be behind us in terms of GDP contraction and our spring forecast predicts a subdued recovery for 2010," it said.

Analysts polled by Reuters had expected an increase in economic sentiment to 70.8 points. A separate business climate index released by the Commission also showed gains, but remained at weak levels. "Like many other surveys this indicator has underestimated the extent of the downturn in recent quarters," said Daniele Antonucci at Capital Economics.

"Hence, while we agree that the economy is no longer in free fall, we remain cautious at this stage," said Antonucci, noting there was still a mixed picture on the second quarter from core economic data released so far. Bayerische Landesbank economist Joerg Angele said the data heralded a slow recovery and expected the European Central Bank to keep interest rates low until the middle of next year.

The sentiment improvement was fuelled by the services sector, consumers and, to a lesser degree, industry. Morale in the construction sector stagnated and fell in the retail sector. "The increase observed at sector and country level is mainly driven by improving expectations, as the main economic actors seem to be gaining confidence that the crisis is easing," the Commission said in a statement.

The survey confirmed deflationary pressure in the eurozone. Inflation expectations 12 months ahead among households fell again in June to set a new low of -9 points from a downwardly revised -8 points in May, marking the third consecutive month of expectations of falling prices.

But selling-price expectations among manufacturers increased to -11 from May's -12. The European Central Bank watches inflation expectations closely in its policy decisions, aiming to anchor them at its price stability target of inflation just below 2 percent over the medium term.

With inflation moving to negative territory and recession persisting, the ECB has cut its main rate to a record low of 1.0 percent. Separately, the Commission said its business climate indicator rose to -2.97 in June from a revised -3.11 for May, fractionally above expectations but still at historically low levels.

(Reuters)

• 0 comments »

Tuesday June 30, 2009

CHICAGO: Moody's Investors Service said on Monday it changed the outlook for the US port industry to negative from stable, citing economic trends, including the recession and weak consumer confidence. "The breadth and depth of the economic downturn may result in fundamental shifts in trade patterns, and negatively affect the competitive position of some ports," said Baye Larsen, a Moody's analyst, in a statement.

"While many ports entered the recession with strong financial metrics, these will likely diminish depending on the length and depth of the downturn." The outlook reflects the rating agency's expectations over the next 12 to 18 months. Moody's rates 53 ports with about $6.5 billion of outstanding debt, ranging from Ba3 to Aa2. Moody's said that the slowing activity at ports is allowing for capital projects aimed at improving capacity and operating efficiencies.

(Reuters)

• 0 comments »

Tuesday June 30, 2009

SHANGHAI: Guilin Sanjin Pharmaceutical, the first firm to launch an initial public offering in China since September, started taking orders on Monday, expecting the offer to be heavily oversubscribed, dealers said. Analysts said the retail tranche of the IPO drew heavy demand from the early hours as investors believe Sanjin will shine on its debut due to ample liquidity in the market.

"As the first IPO, it is bound to appeal to retail investors and draw great amounts of subscription funds," Cai Junyi, an analyst with Shanghai Securities, told AFP. The company said last week it would raise 910.8 million yuan (133 million dollars), or 44 percent more than originally planned in its prospectus for the IPO. It said 20 percent, or 9.2 million shares, of the offering is available for institutional investors while the remaining 80 percent is earmarked for retail investors. Cai said that once Sanjin debuts on the stock exchange in mid-July, the price will have little to do with fundamentals and much more with market sentiment.

Guilin Sanjin said premarketing indicated the institutional tranche was 165 times oversubscribed. It is scheduled to announce the results of the subscriptions and the date of debut later this week. China's securities regulators halted IPOs in September due worries that pressure on liquidity would worsen the already ailing domestic stock markets.

The key index plummeted 65.5 percent last year as the global financial crisis kicked in. However, it has rebounded nearly 57 percent since the beginning of 2009 to become one of the world's best performing markets. More than 30 companies, including the country's largest home builder China State Construction Engineering Corp, have received initial regulatory approval but have been waiting for up to a year to sell shares to the public.


(AFPc)

• 0 comments »

Tuesday June 30, 2009

TOKYO: Japanese industrial output jumped 5.9 percent in May as car and electronics production pulled out of a deep slump, although an inventory build-up in some sectors suggested the rebound would soon lose momentum. Manufacturers forecast output growth to slow to 3.1 percent in June and to just 0.9 percent in July amid an absence of a convincing global recovery.

"Output has been making big gains since February as manufacturers try to make up for overshoots in inventory cuts last year, but final demand is still weak and we expect output to dip again once inventory has been restocked," said Junko Nishioka, chief economist Japan at RBS Securities.

"Japan's economy won't bounce back in the true sense until the global economy, and especially the US economy, recovers. And that won't be until the second half of this year or early next year." Japanese factories can expect little help domestically, with rising unemployment and weak retail sales pointing to tepid domestic spending.

Inventories have dropped for five months in a row as the collapse of US investment bank Lehman Brothers last September sent Japan's key export markets plunging, prompting huge production cuts. Car production jumped 24.8 pct in Japan in May with inventories rising for the first time in four months, while electronic parts production rose 10.5 percent.

The 5.9 percent rise in overall industrial output matched the gain seen in April, which was the biggest rise since 1953, but lagged the median market forecast for a 7.0 percent rise.

Overall shipments picked up 4.5 percent in May, the fastest monthly rise since 1992 and inventories fell to their lowest level since 2004, but the inventories-to-shipments ratio edged up 0.1 percent for its first rise in three months. A decline in shipments of capital goods and general machinery suggested that companies still lack an appetite for spending on plant and equipment, said Takeshi Minami, chief economist at Norinchukin Research Institute.

Economists expect output to rise for a few more months as Japanese manufacturers rebuild stocks after cutting inventories more aggressively than rivals in other countries. That should help to push the Japanese economy out of its deepest recession in modern times, with growth of 0.4 percent seen in April-June after four straight quarters of contraction, Japan's longest recession on record.

The Bank of Japan's tankan business survey due out on Wednesday is likely to show the mood among big Japanese manufacturers improving from record lows a quarter ago. Still, the sharp recession leaves huge slack in factories and employment and analysts question whether the recovery is sustainable.

In a sign of weakness in Japan's economy, data last week showed Japanese consumer prices fell a record 1.1 percent in the year to May, with growing signs of falling demand pushing the economy deep into its second spell of deflation this decade.


(Reuters)

• 0 comments »

Tuesday June 30, 2009

FAISALABAD: Textile exporters could bring in $25 billion forex from exports in the next two years and 120 billion during the next 10 years, if they were provided a level playing field and productivity-conducive consistencies, claimed Azhar Majeed Sheikh Chairman FPCCI (Federation of Pakistan Chambers of Commerce and Industry) Standing committee on export trade, here Monday, in post-budget proposals to Shaukat Tarin, Advisor Finance.

A major issue pertaining to exports still remained unattended and unsettled, he said. Pin pointing the major irritants he advocated that exports should be zero-rated, as exporters were heavily burdened with 6.8% local taxes, whereas China, India, Bangladesh's exporters got 17% incentives. The difference with regional players was 25%, he said and demanded a 8% minimum, duty draw-back against local taxes for a level playing-field.

The 10% regulatory duty on pigment-thickeners should also be withdrawn, he said. Similarly, any projected increase in the Polyester fibre duty would also scuttle the power-loom sector, he asserted. He also demanded an exemption of federal excise duty on insurance, banking, port and terminal operations for zero-rating purposes. Yet another demand was the refund of duty draw-back and Sales tax at the time of negotiations in banks.

As is the case with the deduction of income tax, he also demanded the payment of the pending refunds of earlier years, and also the release of 60% R&D claims. Pointing at the inconsistent and detrimental Monetary and Energy Policy's shortcomings, he said that the financial cost of credit borrowings, all over the world, was 0.4%, but in Pakistan, it was 14 to 18%.

Lamenting the tremendous increase in electricity and gas prices, he demanded a 10% deduction in gas prices, as well as mandatory exemption for textiles from gas load-shedding, to allow it to fulfil its export commitments. Azhar Majeed Sheikh demanded that free access of Bangladesh and other regional countries to Europe and America be offset through export incentives to the local industry.

These constraints had put exporters in a very difficult cash-flow situation, he contested and demanded the capping of the mark-up rate on various products to 7.5%, and the freezing of the earlier accumulated mark-up for 2years and the provision of Rs 40 billion for direct cash support to the export industry. He gave the assurance that if irritants were removed, a level playing field provided and export-conducive measures enforced, exporters would achieve the high targets for exports.


(BRecorder)

• 0 comments »

Tuesday June 30, 2009

ISLAMABAD: The prices of vegetables, fruits and pulses have increased by 20-30 percent after the announcement of the current budget, claimed traders community of local market. Talking to Business Recorder here on Monday traders revealed that prices of essential commodities including vegetables, fruits and pulses have gone up as much as by 20-30 percent.

Traders said that the price of Nido milk has gone up from Rs 360 to Rs 390 per kg. Similarly the prices of Mash Pulse, Moong Pulse, Masoor Pulse and Gram Pulse have gone up by Rs 10 to Rs 15 per kg. Prices of tomato have gone up from Rs 25 to Rs 40 per kg, Prices of onion has witnessed an increase of Rs 10 per kg as prices has gone up from Rs 20 to Rs 30 per kg and prices of lady finger has gone up from Rs 35 to Rs 40 per kg.

On the other hand the prices of fruits have also witnessed an increase of 10 to 20 percent. The prices of mango have gone up to Rs 60 per kg from Rs 45 per kg. Traders opined that ongoing military operation in Malakand division is also considered to be one of the reasons behind the raise in fruits and vegetable prices.

Pakistanis have been grumbling about rising inflation for more than a year but in the past few days the sticker shock has grown much worse. Vegetables and fruits prices have jumped that now it is going out of reach of the poor segment of the society.

The people of the twin cities of Rawalpindi and Islamabad have termed it an artificial shortage by the wholesalers and retailers who are looting the innocent people with both hands some time on the name of short of supply and some time on the electricity and gas loadshedding. Ahmad Ali a resident of the Abpara told this scribe that we were told that due to law and order situation number of check posts has been increased and it is going difficult to meet the purchase orders and due to which some of the items are going short in the market.


(BRecorder)

• 0 comments »

Tuesday June 30, 2009

KARACHI: The Securities and Exchange Commission of Pakistan (SECP) has suspended the registration of five members of Karachi Stock Exchange (KSE) till the claims against them in the light of the investors' complaints are ascertained and settled in accordance with law.

Following the SECP decision, the Karachi Stock Exchange has also suspended the trading rights of the these five members with immediate effect and until further notice to protect the interests of the investors. The SECP took this decision in exercise of its powers under the Broker and Agents Registration Rules, 2001, and suspended the registration of these five brokerage houses on charges of non-compliance with the various provisions of the Broker and Agents Registration Rules, 2001 pertaining to investor rights.

The registration of these brokerage houses will remain suspended, in public interest and for the protection of investors and to preserve capital market integrity, till claims against them in light of the investors' complaints could be ascertained and settled.

The names of the KSE members whose trading rights and registration have been suspended are: Eastern Capital Limited; Prudential Securities Limited; ClikTrade Limited; MKA Securities (Private) Limited; and Capital One Equities Limited. The SECP in a statement issued on Monday also announced that an impartial enquiry into the business affairs of these brokerage houses will be conducted to ascertain the quantum and genuineness of investors' complaints, in accordance with law.

The SECP has introduced a number of capital market reforms over the past years aimed at providing increased investor protection and minimisation of manipulative elements in the market. However, during the recent past, SECP, as well as the Karachi Stock Exchange (KSE), received substantial number of investor complaints/claims, majority of which pertained to non-transfer of shares to the investors' CDC Accounts and non-payment of funds, which can be attributed to the unauthorised pledge/transfer of securities by some of the stockbrokers.

Taking cognisance of the matter, the SECP advised these brokers to expedite resolution of pending investor complaints/claims and issued instructions for immediate transfer of clients' shares to their respective CDC account. Furthermore, the SECP advised KSE, in its capacity as frontline regulator, to submit a concrete proposal for efficient and equitable resolution of unresolved investors' complaints/claims.

In the meanwhile, SECP, in pubic interest and for protection of investors, imposed restrictions on opening of new CDC sub-accounts and registration of new UINs by these brokerage houses. This restriction was, however, immediately removed for those brokerage houses which were able to resolve all pending investor claims/complaints registered against them.

Further, in order to inculcate good governance in business conduct of brokers and for safeguarding the interests of investors, the SECP, in co-ordination with relevant stakeholders, introduced standardised sub-account opening form at CDC and imposed prohibition on all general purpose/blanket authorities for handling book entry securities of clients by the broker to curb any misuse, and safeguard the interest of investors as well as of the participants.

Taking into consideration that no concrete steps were taken by these brokers, despite ample time granted, the SECP issued notices to the abovementioned five brokerage houses, and provided them with another opportunity of representation before the Commission on June 25, 2009.

However, when these brokerage houses failed to put forth any concrete time-bound action plans and take tangible measures for the resolution of outstanding investors' claims, the SECP, using its regulatory powers, issued orders for suspension of registration of the above-mentioned brokers. The SECP has reiterated its commitment to continue providing regulatory framework and taking enforcement actions for the protection of investors, curbing market abuse and preserving capital market integrity.


(BRecorder)

• 0 comments »

Tuesday June 30, 2009

KARACHI: Pakistan Steel Mills will import 400,000 tons iron ore from Iran, to meet its requirements. Of the 15 pre-qualified ship owners/operators, 12 had collected the documents, whereas only six parties submitted their offers for transportation of the required iron ore from Bandar Abbas to Port Qasim.

Noble Chartering, of Hong Kong, represented by Pacific Chartering, Karachi, which had quoted $14.73 per ton, was declared successful when the bids were opened on Monday morning by a committee headed by Director (Finance) Pakistan Steel in the presence of the bidders. Pakistan Steel Mills imports about 1.6 million tons iron ore, and 1.0 million tons coal annually. The iron ore is mostly imported from India to get advantage of freight. However, Indian iron ore is weaker in quality as compared to high priced Iranian or Australian iron ore.

Due to recent global crisis where majority of steel mills have either shut down their production or have reduced it to economical levels, it goes to the credit of Pakistan Steel that it has not only honoured its commitment with supplier but also continues to produce quality steel products at economical levels and competing market forces in spite of the hindrances created by outside pressure, including labour unions, etc. The freight rates achieved in the tender would further reduce the cost of raw materials being imported and result in reduction of cost for the steel products.

This would increase the sale of Pakistan Steel products, and availability of steel products at cheaper rates would encourage the construction sector, solving employment problems considerably. Other five bidders were STX Panocean Co Ltd of Korea, which had quoted $14.87/ton; Ocean Wise Services, $15.05; PNSC $16.00; Pacific Lloyds Ltd, of Malta, $17.95; and Shahdab Pty Ltd, Australia, $18.18 per ton.


(BRecorder)

• 0 comments »

Tuesday June 30, 2009

ISLAMABAD: The Sensitive Price Indicator (SPI) based inflation has been on declining trend as it reduced from 13.99 percent during the week ended on April 23 to 10.81 percent during the week ended on June 25.

According to Federal Bureau of Statistics, the change in inflation, for the combined groups, were recorded at 13.28 percent in the week ended on April 30, 11.82 percent on May 07, 11.20 percent on May 14 and 10.92 in the week ended on May 21.

Similarly, the SPI inflation recorded change of 10.25 percent during the week ended on May 28, 10.67 percent on June 4, 11.01 percent on June 11 and 11.78 percent on June 18.

The SPI for the week ended on June 25, for the lowest income group up to Rs.3,000, has registered nominal increase of 0.11 percent over the previous week.

The SPI for the week under review in the above mentioned group was recorded at 226.51 as against 226.27 registered in the previous week.

SPI for the combined group registered increase of 0.16 per cent by growing up from 215.78 in the previous week to 216.12 in the week under review.

As compared to the corresponding week of last year, the SPI for combined group in the week under review witnessed increase of 10.81 percent.

During the week under review average prices of 9 items registered decrease, while that of 20 items increase with the remaining 24 items’ prices unchanged.


(AFP)

• 0 comments »

Tuesday June 30, 2009

LONDON: European stock exchanges recorded strong gains on Monday, with investors in a buying mood as the first half of the year winds down ahead of key US data later in the week.

In London the FTSE 100 index climbed 1.25 percent to close at 4,294.03 points, gaining strength following a positive start to the trading day on Wall Street.

In Paris the CAC 40 rose 2.04 percent to finish at 3,193.68 while in Frankfurt the Dax added 2.27 percent to reach 4,885.09.

Elsewhere there were gains of 1.5 percent in Amsterdam, 1.21 percent in Brussels, 1.64 percent in Madrid, 0.17 percent in Milan and 1.25 percent on the Swiss Market Index.

In New York the Dow Jones Industrial Average was up 0.89 percent at mid-day at 8,513.28. The tech-heavy Nasdaq had risen 0.45 percent to 1,846.50.

The economic calendar was empty Monday but investors faced a slew of data in the holiday-shortened week, with the market closed Friday for the July 4 Independence Day holiday.

Among the key reports are the June consumer confidence reading on Tuesday, June automobile sales on Wednesday and the June unemployment report, a bellwether on economic momentum, on Thursday.

"The market is in a discerning state of wait-and-see, as it looks for justification in the upcoming second quarter earnings reports and incoming economic data to keep the recovery rally going," said Patrick O'Hare of Briefing.com.

"We think it could be disappointed given the lack of economic evidence suggesting there has been a strong pickup in end demand that would allow for the majority of companies to deliver top-line driven earnings surprises."

In London sentiment was largely driven by the banking and insurance sector, with investors attracted by positive comment from analysts.

Lloyds Banking Group jumped 6.12 percent to 70.56 pence after Goldman Sachs added it to its list of preferred stocks.

Barclays rose 4.31 percent to 279.65 while Schroders gained 3.67 percent to finish at 846.50 pence.

In Paris, according analyst Alice Lhabouz of Turgot Asset Management, "there has been some technical buying before the end of the first semester."

She said portfolio managers appeared ready to invest in cyclical -- and riskier -- stocks before drafting their semester reports.

Oil issues were well supported, taking advantage of rising crude prices. Total added 2.53 percent close at 38.97 euros while Vallourec rose 3.32 percent to 87 euros.

In Frankfurt companies that are especially dependent on macroeconomic developments were in demand.

The industrial conglomerate Siemens added 3.19 percent to close at 50.41 euros while chemical group BASF gained 3.93 percent to finish at 29.12 euros.

Volkswagen crept up 0.71 percent to 251.18 euros. But the auto maker suffered from tensions with Porsche, its principal shareholder.

Porsche, the heavily indebted maker of German luxury sports cars, rejected a merger offer by Volkswagen.

Deutsche Telekom rose 2.49 percent to close at 8.43 euros on press reports that its British rival Vodafone was preparing an offer for Deutsche Telekom's British subsidiary T-Mobile UK.

In Asia on Monday, Tokyo ended down 0.95 percent and Hong Kong slipped 0.39 percent, ending a three-day winning streak, as investors took profits ahead of a series of economic reports due this week.


(AFP)

• 0 comments »

Tuesday June 30, 2009

TOKYO: The yen was under pressure in Asian trade on Tuesday as investors bought higher yielding assets amid hopes of an improvement in the global economy, dealers said.

The dollar firmed to 96.11 yen in Tokyo morning trade from 96.04 in New York late Monday. The euro climbed to 1.4114 dollars from 1.4088 and to 135.58 yen from 135.28.

The "safe-haven" yen was sold on expectations that Japanese investors would send more money overseas as risk aversion eases, NAB Capital analyst John Kyriakopoulos wrote in a note.

Japanese investors continue to buy foreign bonds to take advantage of higher yields overseas and as "growth prospects at home remain poor," he added.

The VIX volatility index, known by many market players as the "investor fear gauge", fell Monday to its lowest point since just before Wall Street giant Lehman Brothers collapsed last September.

The Australian and New Zealand dollars -- whose fortunes are closely linked to commodities prices -- were also higher against the yen.

Currency traders waited for fresh cues from a string of economic figures in the United States, including housing and consumer data out later in the day, followed by employment and manufacturing figures later this week.

US markets will be closed Friday for the Independence Day holiday.

In Japan, a key survey of business confidence, due to be released on Wednesday, is expected to show an improvement in sentiment among the country's major manufacturers from a record low the previous quarter.

Investors will also scrutinise China's purchasing managers' index due out on Wednesday for clues on growth prospects for the Asian giant, dealers said.

The European Central Bank is scheduled to meet Thursday with its policymakers focused on how to support bank lending. The ECB is widely expected to hold its key lending rate steady at an all-time low of 1.0 percent.


(AFP)

• 0 comments »

Tuesday June 30, 2009

NEW YORK: US stocks rose on Monday as higher oil prices lifted shares of energy companies and fund managers snapped up this quarter's winners to burnish their portfolios.

Energy shares were a strong performer in the quarter, and a 3.4 percent jump in the price of oil lifted them even further on Monday. Exxon Mobil Corp was the Dow's top driver, rising 2.2 percent to $70.58.

Fund managers are building up their portfolios before the quarter ends on Tuesday in a ritual known as "window dressing" by selling some of the quarter's losers and scooping up the winners. This move bolstered stocks as well.

"This has been a heck of a run," said Marc Pado, US market strategist at Cantor Fitzgerald & Co, in San Francisco. "A lot of people didn't believe and left a lot at the table. Having the right positions (and) not showing a great deal of cash, that is really the main driving force here -- the so-called window dressing.

"You can show you own the names that everyone knows did well," he said.

Financials, the day's top advancer, also led quarterly gains, followed by technology.

The S&P 500 is up 16.2 percent so far for the quarter, putting it on track for its best quarter since the fourth quarter of 1998, when the index jumped nearly 21 percent.

The Dow Jones industrial average gained 90.99 points, or 1.08 percent, to end at 8,529.38. The Standard & Poor's 500 Index was up 8.33 points, or 0.91 percent, at 927.23. The Nasdaq Composite Index was up 5.84 points, or 0.32 percent, at 1,844.06.

Shares of home builders also helped underpin the market after Credit Suisse raised its rating on KB Home, citing stronger orders and more attractive valuation. KB Home was up 5.1 percent at $14.11. The Dow Jones US Home Construction Index advanced 1.5 percent.

Wall Street's eyes and ears also were on the news coverage of Bernie Madoff, who was sentenced to 150 years in prison on Monday for running what prosecutors called a $65 billion Ponzi scheme. When Madoff's fraud was revealed last December, its scope was so brazen and so massive that it shocked investors and made everyone question their broker.

Signs of life in overseas markets helped to build optimism about the prospects for an economic recovery.

Shanghai stocks reached a one-year closing high for the fourth straight session as signs of a Chinese economic recovery and ample liquidity boosted the market, bolstering investor sentiment.

Crude oil futures jumped $2.33 to settle at $71.49 per barrel after Nigerian militants said they attacked the country's oil facilities, which set off some concerns about supply.

An S&P energy index was up 1.3 percent, while Occidental Petroleum jumped 2.9 percent to $66.13.

On the Nasdaq, Microsoft Corp advanced 2.2 percent to $23.86 after Deutsche Bank raised its price target on the stock to $30 from $22.


(Reuters)

• 0 comments »

Tuesday June 30, 2009

SINGAPORE: Oil prices rose above 72 dollars in Asian trade Tuesday as tensions in Nigeria, a key African crude producer, rattled investor sentiment, analysts said.

New York's main contract, light sweet crude for August delivery, put on 1.08 dollars to 72.57 dollars.

Brent North Sea crude for August delivery leaped 1.21 dollars to 72.20.

Nigerian rebels said Monday they raided a Shell facility and killed at least 20 soldiers in a gun battle, a claim denied by security forces.

A Shell spokesman, however, confirmed the raid and said production had been affected.

"Reports of another Nigeria attack seems to give the market a boost, as well as a report that China is going to add to its strategic petroleum reserves," said Phil Flynn of Alaron Trading.

The Movement for the Emancipation of the Niger Delta (MEND) militants said the Shell Forcados off-shore platform in Delta state was burning "after a massive explosion" following their 2:30 am (0330 GMT) raid.

Monday's raid was just the latest in a series that have targeted Shell facilities this month and which have continued despite last Thursday's offer from President Umaru Yar'Adua of an amnesty for the militants.

Weekend reports that China planned to increase strategic crude oil reserves by 60 percent to 270 million barrels during the next five years also boosted prices, Flynn said.

"If China continues to strengthen its reserve then oil will be bought on pullbacks. This should help provide some long term support," he said.

Oil prices have steadily gained ground in recent weeks on hopes of a global economic recovery and persistent weakness in the US dollar which makes dollar-priced crude cheaper for holders of foreign currencies.



(AFP)

• 0 comments »

Tuesday June 30, 2009

FAISALABAD: Textile exporters could bring $ 25 billion forex from exports in next two years and 120 billion during next 10 years if they are provided level playing field and productivity conducive consistencies.

This was claimed by Azhar Majeed Sheikh Chairman,Federation of Pakistan Chambers of Commerce and Industry (FPCCI) standing Committee on export trade here Monday in post budget proposals to Shaukat Tarin Advisor on Finance.

Major issue pertaining to exports still remains unattended, he said. He demanded exemption of federal excise duty on insurance, banking, port and terminal operations for zero rating purposes. Yet another demand was refund of duty drawback and sales tax at time of negotiation in banks as is case with deduction of income tax. He also demanded payment of pending refund of earlier years and also release of 60% R&D claims.

Azhar Majeed Sheikh demanded offsetting the free access of Bangladesh and other regional Countries to Europe and America through export incentives to local industry.

These constraints have put the exporters in a very difficult cash flow station; he contested and demanded capping of mark up rate on various products to 7.5% and freezing of earlier accumulated mark up for 2years and provision of Rs.40 billion for direct cash support to export industry.

He assured that if irritants are removed, level playing field is provided and export conducive measures are enforced, the exporters would achieve the higher targets for exports.


(APP)

• 0 comments »