Americas markets wrap: Bovespa rises on cooling credit growth
Brazilian and Chilean stocks rebounded following Wednesday’s sharp losses as a the Brazilian credit boom cooled and copper prices ticked up. But Mexican equities
Brazil’s Bovespa rallied 0.6 per cent on Thursday as financial shares rebounded after the central bank said consumer lending slowed. Banco Santander’s Brazilian arm added 3.3 per cent and oil group OGX surged 4.8 per cent. Continue reading »
[snap] Mubarak will not step down, transfers some powers to VP
Hosni Mubarak is not stepping down, contrary to earlier reports. In a televised address late Thursday night, the embattled Egyptian president said he “will not accept or yield to foreign dictations or orders” to leave, and vowed to follow “the track of a peaceful transition until September” when elections are scheduled.
But he did say he would delegate day-to-day powers of the president to his vice-president, Omar Suleiman, as part of a preliminary consensus reached with opposition leaders.
Protestors in Cairo’s Tahrir Square greeted the statement with jeers, shouting “get out, get out”.
Colombia entices LatAm magnates
What do the world’s richest man and the world’s eighth-richest man have in common? Colombia, it seems.
Just as Carlos Slim, the Mexican billionaire, announced he was eyeing Colombia’s burgeoning oil industry, Eike Batista, Brazil’s richest man, said he is planning to raise up to $1.5bn selling shares in his Colombian coal assets in a global offering. Continue reading »
Is CSN setting its sights on Riversdale?
By Samantha Pearson in São Paulo
Has Benjamin Steinbruch finally learnt his lesson? The Brazilian metals magnate (pictured) has made a name for himself by trying – and failing – to buy up some of the biggest names in the sector.
His steelmaking company CSN bid for Anglo-Dutch Corus in 2006 and even tried its luck at a merger with Germany’s Thyssen-Krupp and Arcelor of Luxembourg before it became ArcelorMittal. All of which came to nothing. Continue reading »
Deal of the day: Posco E&C enters South America
By Eunice Kang of mergermarket
Posco Engineering & Construction has become the first Korean engineering company to make a South American acquisition. The construction unit of South Korea’s steel giant announced on Wednesday that it would acquire a 70 per cent stake in Santos CMI, an Ecuadorian counterpart, for $72m.
While the deal is small, it gives Posco E&C first-mover advantage and a foothold in a continent where construction is set to boom over the next few years. Continue reading »
CEE markets wrap: equities plummet
Central and eastern European stocks plummeted on Thursday, as the fallout from China’s interest rate hike on Tuesday continued and fears about political instability in Egypt intensified.
“The market’s been soaring for a while now, so a correction was inevitable,” Kingsmill Bond, chief strategist at Russian investment bank Troika Dialog. “China’s rate rise and speculation about the imminent departure of president Mubarak in Egpyt have proved the catalyst.” Continue reading »
BarCap: forget bonds, go for equities
Just when international investors are pulling out of emerging markets, along comes a bank saying buy emerging market equities.
BarCap argues in a report on Thursday that while everybody expects emerging markets to continue to grow faster than the developed world over the next decade, that expectation isn’t “fully-priced in today’s equity markets”. Crisis or no crisis, returns over the next 10 years should average over 10 per cent (in real US dollar terms), just as they have over the past decade. Continue reading »
[snap] Mubarak to go, reports
It looks like Egyptian president Hosni Mubarak is going.
He will “most probably” step down, an Egyptian official told Reuters on Thursday after unprecedented nationwide protests against Mubarak’s 30-year rule.
And the BBC reported that Egyptian prime minister Ahmed Shafiq told the broadcaster Mubarak, may step down and the situation in the country will be clarified soon.
“In an interview with BBC Arabic, Egyptian Prime Minister Ahmed Shafiq confirms that the scenario of President Mubarak stepping down is being discussed. He says whether it is positive or negative will be clarified soon,” the BBC said on its website.
IMF champions the renminbi
The International Monetary Fund has called for a greater role for China’s renminbi in the world financial system. In a speech on Thursday, Dominique Strauss-Kahn, the IMF’s boss, said adding emerging market currencies such as the renminbi to a basket that the IMF administers could add stability to the global system, according to Reuters.
The sentiment of his call will be music to China’s ears as it is internationalising the renminbi and promoting it as a future supplement to the dollar as the world’s reserve currency. But Strauss-Kahn’s specific proposal may not be China’s favoured technique. Continue reading »
The $1.1m Maybach comes to India
By Girija Shivakumar
Mercedes-Benz has made a new foray into India, this time targeting the super luxury segment of the automobile market.
The carmaker has launched the Maybach – priced at a hefty Rs 51m ($1.1m) – after struggling to make headway in India. Peter Honegg, chief executive of Mercedes-Benz India said that it was “time for a second push” for the company, which first entered the country in 2004. Continue reading »
Poland’s Karkosik to build war chest
Polish investors who failed to hitch their wagons to local billionaire Roman Karkosik in two previous share offerings are likely to get another chance soon, as Karkosik builds up his war-chest for a further round of acquisitions.
Last year Boryszew, an investment vehicle of which Karkosik owns 58 per cent, raised 115m zlotys in two share issues. It aims to try for a further 113m zlotys by the spring. Continue reading »
South Korea: money heads out
A series of capital controls that South Korea imposed in recent months look like they are finally beginning to curb foreign investors’ strong appetite for South Korean assets.
Foreign investors’ net holdings of South Korean bonds fell for a second straight month in January, following a record sell-off in December, after the government reimposed a 14 per cent withholding tax on foreigners’ income from sovereign bonds. Concerns about higher interest rates were also taking a toll. Continue reading »
Indian inflation, still a threat
Indian policymakers should breathe a little easier this week as food inflation eased on moderating prices of fruits and vegetables. But analysts still question whether the country can control inflation while maintaining ambitious growth targets.
According to figures released on Thursday, India’s food price index stood at 13.1 per cent for the week up to January 29, down from 17.1 per cent recorded for the week before. Continue reading »
Guest post: Brazil’s fiscal mythology
By Sergio Vale of MB Associados
Wednesday afternoon’s announcement of spending cuts by Brazil’s federal government at times sounded like a campaign event. A lot of assurances were given, but there was little new or of substance that will really change the course of fiscal policy this year.
A clear example is the government’s statement that it will cut primary spending (excluding interest payments) in 2011 from the R$769.9bn previously programmed to R$719.9bn. If we subtract last year’s windfall from the Petrobras share issue – unlikely to be repeated this year – there will in fact be an increase in nominal spending (including interest payments) of 10 per cent between 2010 and 2011. Continue reading »
Asia markets wrap: China defies equity losses
Chinese stocks defied losses elsewhere in Asia on Thursday, amid speculation that falls earlier in the week in response to the country’s interest rate hike were excessive.
“There’s a sense in China that losses in Shanghai on Wednesday were out of proportion,” Mark Williams, China economist at Capital Economics in London, told beyondbrics. “Elsewhere in Asia, though, fears about further anti-inflation measures in China seem to be taking hold.” Continue reading »
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