Daily Archives: Nov 10, 2011

Petrobras, Brazil’s state-run oil company, normally likes to keep everyone in suspense by releasing its quarterly results on a Friday and waiting until the following Monday to explain them at a press conference.

However, this time the presser is scheduled for straight after the third quarter results on Friday night, which probably means only one thing: they’re not going to be pretty. Read more

Concerns about the impact of the eurozone crisis on the developing world are spreading even to countries with little apparent connection to Athens or Rome. Asian equities on Thursday suffered their biggest declines in nearly two months as investors struggled to make sense of the latest from Greece and Italy. CEE markets had another nervous day. Even Latin America is on euro watch.

It could hardly be otherwise: the European Union is the world’s largest economy and the biggest trade partner for many EMs, headed by China. Eurozone-based banks account for around two-thirds of international lending. As Stefan Wagstyl writes for the FT, there’s a lot to worry about.

 Read more

By Jude Webber and William MacNamara

Get ready to rumble. UK-listed international miner Anglo American and Codelco of Chile are heading for a court showdown after Anglo decided to sell 24.5 per cent of its Anglo American Sur assets to Mitsubishi for $5.39bn. The pre-emptive sale is aimed at foiling an attempt by Codelco to buy the same assets at much lower prices under a long-standing option agreement.

Here are some of the key legal issues surrounding the dispute. Read more

Poland gold zloty, GettyThe Polish finance ministry’s hopes of economic growth of 4 per cent for next year have seemed increasingly unrealistic for months now – but the ministry was understandably reluctant to change them before October’s parliamentary elections. No one wants to give the voters a nasty shock.

Now that the election is over – and the ruling Civic Platform party has secured a second term – the ministry has put on its reading glasses and a much more realistic view of 2012 has come into view. Read more

South Africa’s Reserve Bank kept interest rates unchanged at 5.5 per cent on Thursday, a move most analysts expected as the monetary authorities juggle with sluggish growth prospects and inflationary pressures.

Inflation (the CPI index) hit 5.7 per cent in September, inching ever closer to the upper band (6 per cent) Sarb traditionally looks to keep within. Meanwhile, the Treasury has downgraded its growth forecast to 3.1 per cent this year, with global economic concerns darkening the mood in Africa’s largest economy. Read more

Serbia’s banking sector could face plenty of hardships in the coming year, from rising loan defaults to Greek and Italian trade fallout. Yet severe deleveraging by mother banks in the eurozone – the grim scenario contemplated repeatedly in the Balkans since 2009 – is unlikely to come to pass, local bankers say.

“The banking sector here is very sound, very liquid,” said Aleksandra Vukosavljevic, head of research at Raiffeisen, an Austrian bank in Serbia. “All banks, locally, are very sound and well capitalised.” Read more

Battling Asia’s highest inflation rate and a banking system that is at “very high risk” of a crisis according to Standard & Poor’s, Vietnam’s central bank this week sent out an urgent communiqué to Vietnamese financial institutions.

But the State Bank of Vietnam was not warning them to boost their balance sheets or clean up their risky loan books. It was urging them to make their employees vote for Halong Bay, one of Vietnam’s most popular tourist destinations, as one of the new seven natural wonders of the world. Read more

The ‘king of the good times’ has fallen on hard times.

Kingfisher Airlines, the creation of Vijay Mallya (pictured), India’s billionaire liquor baron and self-styled “King”, is so massively in debt that analysts told beyondbrics they wouldn’t be surprised if it went into bankruptcy or even ceased operations, potentially as early as next week when the airline is due to release quarterly results. Read more

Serbian customer takes money from an ATM in BelgradeSerbia, the first European country to cut interest rates this summer in response to the eurozone crisis, on Thursday sliced another 75 basis points off its benchmark rate, taking it down to 10 per cent.

This fifth cut in succession has raised concerns about a possible weakening of the dinar – a big issue in a country with sizeable foreign exchange debts.  But so far the currency has actually been rising. Read more

* Berlusconi reported ready to back Monti for PM

* China export growth dips as EU slows

* Anglo cuts Codelco out of copper deal Read more

Fancy an investment punt in the tourism sector? Your own B&B on the coast?

Make that the Black Sea rather than Blackpool or Palm Beach – because Romania should welcome you with open arms. It’s that short of foreign investment. Read more

By Sergey Aleksashenko and Martin Gilman

As the apparent failure of recent summits and crisis meetings has shown, radical action is needed to stop the debt contagion in Europe. Using the International Monetary Fund has been suggested as a way out of the mess. But how can the IMF solve a conundrum that Europeans cannot? Read more

Thursday’s top picks from the beyondbrics team: the global risks in China’s economy; why the world must tread carefully as it confronts Iran; the unsurprising nature of South Africa’s downgrade; and why the Arab League is proving ineffective. Read more

A few weeks ago Diego Hernández, boss of Codelco, Chile’s state copper giant, was being fêted.

For months, he had been quietly knitting together a deal to buy a clutch of prized Chilean copper assets at a knock down price and secure his company’s standing as the world’s top copper producer. Now, however, the whole thing is suddenly under threat. Read more

Indonesia’s surprise 50bps rate cut had immediate consequences for Asian currencies. The rupiah was the biggest faller, down 1.4 per cent against the US dollar.

But, with policy meetings in Malaysia and South Korea tomorrow, the market is betting on more cuts to come. Read more

Indonesia has surprised the market with a 50 basis point rate cut – bringing the benchmark lending rate down to 6 per cent, the lowest since 2005.

Analysts polled by Reuters had been predicting a cut, but not one this large. Make sure you read this piece by ING’s Tim Condon on why BI’s policies may not be about growth.

Chinese internet companies have been trying investors’ patience lately. Shares in two of the country’s web giants – Sina and Tencent – have fallen sharply since announcing disappointing earnings for the third quarter.

The situation – and the outlook – at the two web companies, however, differs widely. Read more

* Deal on new Greek PM falls through

* UN report on Iran spurs sanctions debate

* Anglo cuts Codelco out of copper deal

* Russia to join WTO Read more