Indonesia: Sukhoi passenger jet lost
Dreadful news for the Russian aviation industry. A Sukhoi SuperJet 100, the first new Russian passenger plane since the collapse of communism, went missing on Wednesday during a promotional flight in Indonesia with 50 people on board.
Reuters reported thathe plane disappeared from the radar over high ground in west Java. Searchers have yet to establish what has happened to it – but they fear the worst. The Sukhoi was on a six-day marketing trip in Asia. Continue reading »
Here’s a US company that’s not in oil and gas but is treating the Gulf very seriously.
As the FT reports, Frits van Paasschen, chief executive of Starwood Hotels & Resorts, together with more than a dozen of his top executives, will be based in Dubai for a month next year, a far cry from the company’s headquarters in Stamford, Connecticut. The team will hope to get to grips with Starwood’s ambitious goals in the Middle East, where it plans to expand its business 60 per cent in the coming five years. Continue reading »
Romania: 340 jobs at new Bosch plant
Bosch, the German car parts maker, has confirmed plans to go ahead with a €77m plant in northern Romania, in a move which will give the new government in Bucharest a bit of a boost.
The investment in the city of Cluj-Napoca will bring 340 jobs in the production and development of automotive electronic controls near a site where Nokia closed a showcase plant last year. Good news for a country struggling to avoid recession. Continue reading »
Carlsberg bets on hot Russian summer
There was a difference of opinion over Wednesday’s first quarter results from Carlsberg, the world’s fourth-biggest brewer and the largest in Russia. Reuters and Bloomberg reported that profits were below analysts’ expectations. But the Danish company itself said the first quarter was “in line with expectations”.
Investors, who had been prepared for bad news by a February profits warning, were relieved at the outcome – and the shares rose 5.3 per cent before falling back to trade up 4.2 per cent by late morning in Copenhagen. Continue reading »
Romania: can Ponta stay the course?
Investors have welcomed the rapid confirmation of Romania’s new government, with the leu recovering the ground it lost after the last administration resigned less than two weeks ago.
But there’s something slightly suspicious about the ease with which prime minister Victor Ponta’s coalition has won parliamentary approval for running Romania until November’s elections. Will he really stick to the IMF-backed austerity programme, when austerity is coming under attack elsewhere in the European Union? Will his MPs stay the course as electoral reckoning approaches? Will the parliamentary turkeys really vote for Christmas? Continue reading »
Putin 2.0: any different for investors?
The markets weren’t kind to Vladimir Putin as he was sworn in as Russia’s president. With investors worried about everything from China, oil, US jobs and the French elections, there was little enthusiasm in the Moscow markets to greet the new president.
Stocks and the rouble both slipped on Monday, by 0.4 per cent and 1 per cent respectively, dragged down by the decline in oil. Fund managers clearly had other issues on their mind. But they’re also wary of Russia. Continue reading »
Investors flinch at Hollande win
Investors try to anticipate bad news. But sometimes the cold reality is worse than what was expected, even when what was expected seemed bad enough. So it appears with the French and Greek election results.
The victory of the socialist leader Francois Hollande and the setbacks suffered by both of Greece’s main pro-Europe parties hardly came as a surprise. But the outcome has still shocked the markets, not least emerging markets. Continue reading »
US jobs data hits oil, EM equities
The disappointing US payroll figures published on Friday have had an immediate impact on oil prices – with implications for both producers and consumers in emerging markets.
Brent crude slumped 3 per cent, taking its three-day drop to around 6 per cent, the biggest such plunge since last summer, and few investors will want to be reminded what then happened in financial markets globally, not least EMs. Continue reading »
Fund flows: investors on amber
As far as investors are concerned, the lights are still on amber in emerging markets.
Flows into EM funds in the last week have gone almost entirely into hard currency bonds, with very little trickling into local currency bonds or equities. After this year’s early rally and the sharp sell-off that followed in both equities and currencies, investors are taking care, but are still on the look-out for the extra returns possible in EMs. Continue reading »
Romania: government falls amid public anger at austerity
The Romanian leu suffered its biggest one-day fall this year after the government unexpectedly collapsed in a no-confidence vote.
Prime minister Mihai Razvan Ungureanu’s two-month-old administration is the latest victim of a growing political backlash against austerity policies implemented across the EU.
His successor’s job will be just as difficult. So will the challenges of investing in Romania. Continue reading »
Indonesia: taking a close look at DBS
The Indonesian authorities are going to think long and hard about the $7.25bn planned acquisition by Singapore’s DBS, south east Asia’s biggest bank, of local lender Bank Danamon.
Central bank governor Darmin Nasution on Friday told reporters the deal would be reviewed only after the central bank issues new bank ownership rules at the end of May.
That’s bad news for DBS, though not unexpected. With regional elections due later this year, nationalist sentiments have been growing and prompting the government to impose new restrictions on foreign business. In banking, as in other sectors, the devil will be in the detail. Continue reading »
Russia: gas price hike held at 15%
The Russian government on Thursday confirmed a 15 per cent increase in domestic gas tariffs for Gazprom, the state-run gas group.
As Reuters reported, Gazprom had asked for a 26.3 per cent hike in the domestic gas tariff this autumn, on top of a 15 per cent rise already granted last year.
But prime minister Vladimir Putin rejected the gas exporting monopoly’s bid – and told it to work more efficiently. Continue reading »
Russian gold: Barrick says goodbye
Canada’s Barrick Gold, the world’s largest gold producer, has said goodbye to Russia. On Thursday it sold for £79.5m ($128m) its 20.4 percent stake in Highland Gold, the Russian gold miner in which billionaire Roman Abramovich is the dominant shareholder.
Institutions snapped up the stock at 120 pence per share – not a great return for Barrick which bought in at up to 230p a share. But the Canadians won’t mind too much – they gave up long ago on trying to use Highland as a serious vehicle for entering the forbidding Russian mining industry. Continue reading »
VW: profiting from early bets on EMs
The early 2012 surge in global sales of cars and vans will slow – but demand will still grow, thanks largely to emerging markets. But the market for trucks and buses will be flat – even with the help of EMs.
That’s the view of Volkswagen, the German motor group, which on Thursday reported first quarter results, with a 10.2 per cent per cent gain in operating profits on a 26.3 per cent increase in sales to €47.3bn. Long-established positions in key EMs, notably the Brics, is serving the world’s second-largest vehicle maker well in a troubled global economy. Continue reading »
S Korea: still growing
A sign of recovery from South Korea – a bellwether for the rest of Asia. But the outlook remains tricky for the export-driven economy since global demand is uncertain.
According figures released by the central bank on Thursday, Korean economic growth picked up to 0.9 per cent in the first quarter of 2012, up from 0.3 per cent in the previous three months.
But on a year-on-year basis, GDP grew by only 2.8 per cent, down from a 3.3 per cent increase in the the previous quarter. That’s the slowest since late 2009. Continue reading »
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