Daily Archives: Sep 24, 2010

Brazil's BovespaLatin American stocks saw weekly gains as Petrobras’ record share issue boosted investor’s confidence in the region and commodities rose on upbeat US data. Currencies across the region firmed against the dollar.

“With the US Federal Reserve signaling further efforts to bolster the US economy and public finances in Europe again under the microscope, investors piled into emerging markets assets and precious metals”, said analysts at EPFR Global, which tracks fund flows around the world. Read more

Sao Paulo's Stocks Exchange (Bovespa) CEO Edemir Pinto, Brazil's Vice President Jose Alencar, Brazil's President Luiz Inacio Lula da Silva, Brazil's Minister of Finance Guido Mantega and Petrobras state-oil company CEO Jose Sergio Gabrielli get together to start the morning trading sessionPresident Luiz Inácio Lula da Silva was delighted with the result of Petrobras’s capitalisation, the biggest share issue ever completed, on Thursday night.

But it still is far from clear just how successful it was. Demand seems to have been muted and the government to have bought about 65 per cent of all the shares sold, in spite of talk during the final week of bookbuilding of much greater-than-expected interest among minority shareholders and new investors. Read more

How keen are European governments to tighten their belts? The streets of Poland and the Czech Republic offer some insight.

This week thousands of Czechs and Poles came out to protest against salary cuts and freezes proposed by governments looking to meet budget targets. Investors are viewing it all as a test of the governments’ resolve. Read more

Poland’s stocks hit a two-year high, as markets in emerging Europe were lifted by surprisingly strong German business confidence and US durable goods orders.

The Polish zloty gained against the dollar, on expectations of a rise in interest rates and following better-than-expected retail sales. The region’s other currencies also rose, with the Czech koruna reaching an eight-month peak against the greenback. Read more

By Kasper Viio and Virginia Garcia Martinez of mergermarket

The American consumer market is increasingly shaped by minorities groups including Hispanics, several executives recently told the FT. That has given Latin American companies footholds in the US – and those companies are getting more ambitious.

Colombia’s biggest foodmaker – Nacional de Chocolates – is buying a US cookie-maker, Fehr Holdings, for $84m. One attraction is the US’s large number of consumers, but another is Fehr’s production of high-quality wheat. Read more

Soaring share prices can be a good thing not only for making money but also for deflecting criticism. A new report says that the Philippines has the weakest corporate governance standards of 11 Asian markets. But, with the stock market extending its highs, Philippine regulators can afford to be a bit more smug than usual in their response.

The president of the Philippine Stock Exchange said the report, which was produced by CLSA and the Asian Corporate Governance Association, was a “wake-up call”, but then seemed to downplay its findings. Read more

Reliance Industries, India’s biggest private sector oil and gas group, has long been known for its big investments in non-core ventures, ranging from retailing to real estate.

These other investments are contained in a secretive web of 96 subsidiaries whose accounts are a mystery to investors and analysts alike. At least, they were a mystery until earlier this year, when Reliance, the flagship of India’s richest man, Mukesh Ambani, for the first time published some limited fnancial numbers on these companies. Read more

For the past three years, cash-rich Algeria has been tightening conditions for foreign investors. Now one of the companies affected has received some good news – or at least some less bad news.

Orascom Telecom, an Egyptian phone operator, is being forced to sell Djezzy, its Algerian subsidiary, to the Algerian authorities, who don’t seem to want Orascom in their country. The question is what price Orascom will receive for Djezzy, its most profitable asset. So the fact that France Telecom has paid handsomely for a stake in a Moroccan mobile operator may set a welcome precedent. Read more

India’s love for sweet things doesn’t stop at sugary snacks and desserts. Fizzy drinks have been a favourite ever since Coca-Cola first arrived in the 1970s. While government regulations forced the company to leave India in 1977, it returned in 1993. Since then the country has seen the emergence and success of local cola brands. Today, carbonated drinks are a staple for every local street vendor.

Seeking to build on this popularity, Coca-Cola has now announced plans to invest up to Rs5.5bn ($121m) in a new plant in south India, as it looks expand further in what is one of the world’s fastest-growing beverage markets. Read more

A political compromise appears to be in the works to ease the resignation of Moscow’s embattled mayor Yuri Luzhkov as early as next week, and set the stage for a power sharing agreement by splitting his functions into two posts.

Ever since a campaign in the media to oust Luzhkov erupted two weeks ago, seemingly orchestrated by the Kremlin, the question of who would replace the mayor has been the subject of enormous speculation. It is not just political circles that are interested in the outcome of this struggle, but the business elite and foreign investors as well. Moscow is the country’s financial centre, and the city and its related enterprises are among the largest generators of commercial contracts in Russia. Read more

* Japan to release Chinese boat captain

* KNOC takes control of Dana Petroleum

* Qatar relies on US base amid Gulf tensions

* India rejects Etisalat’s plea for stake hike in JV

* Petrobras raises $70bn in largest offering ever Read more

Asian stocks rose on Friday, with indices in India, Philippines and Thailand lifting their weekly gains to over 2 per cent on hopes of strong economic growth. In Hong Kong, the Hang Seng rose to a five-month high.

South Korea’s state-owned oil company KNOC effectively sealed its hostile takeover of Dana, a UK explorer. Shares in Hyundai Engineering & Construction rose strongly, as other Hyundai companies compete for a controlling share in the company. Read more

From the FT,

From elsewhere,

Hong Kong is quiet because of the Chinese autumn holiday but still business keeps coming in. When you are on a roll, you are on a roll.

As Justine Lau reports on ft.com, Vale, the huge Brazilian mining group, announced plans on Thursday to list on the Hong Kong stock exchange, wanting to get closer to investors in China, its biggest market. It follows hot on the heels of listings and announcements of listings by other resources groups. Read more

Hyundai Group should be concentrating on due diligence, financial planning and balance sheet restructuring as it readies itself to bid for a controlling stake in Hyundai Engineering & Construction in a deal that could be worth up to $3bn.

Instead, in a highly unusual move, it has just splashed out on a deeply emotional prime-time advertising campaign explaining to ordinary Koreans how it is the natural custodian of E&C. But who is it trying to win over with such a gushing public campaign? Read more

* Qatar relies on US base amid Gulf tensions

* India rejects Etisalat’s plea for stake hike in JV

* Industry looks to India as favourite supplier

* Petrobras raises $70bn in largest offering ever Read more

It is finally a done deal: Petrobras will sell about $70bn worth of shares in the biggest share issue in corporate history after enthusiastic investors asked for double that amount. Read more

What can emerging markets offer carmakers? The easy answer is low-cost production: Mexico and Hungary are celebrating new investments from Volkswagen and General Motors respectively. But the factories aren’t the main story. Read more

The first reports of the Petrobras pricing are saying the shares will be offered at 29.65 Brazilian reals (US$17.25) and the preferred stock at 26.30 reals.

Citing unnamed sources, Dow Jones said the offering was priced late on Thursday, Brazilian time, putting the company on course for the world’s biggest-ever share sale, beating the $36.8bn raised in 1987 by Japan’s NTT. Read more

An Indian vegatable seller arranges vegatables as she speaks on a cellular phone at a roadside vegatable market in AllahabadIn India, some 600m people own mobile phones but just 60m have access to broadband internet. Hewlett-Packard is aiming to bridge that gap with apps that can access the web from any cell phone using voice and text messaging.

Meanwhile, a service called Txteagle employs mobile phone users in developing countries to perform “micro-tasks”, like translation or transcriptions, via text message in return for cash or airtime. Read more