China Billionaire Zhang Shiping Beats State Firms as Summit Encourages Markets

China Billionaire Beats State Firms as Summit Encourages Markets

China’s leaders sent a mixed message at a summit in Beijing this week: vowing to boost the role of markets while endorsing the state’s dominance of the economy. The tale of two aluminum companies shows why the nation needs to resolve that paradox. On a Martian landscape in China’s east, yellow bulldozers shovel truckloads of red dirt from a four-story-high mountain to be smelted into molten metal by China Hongqiao Group, the country’s largest private aluminum maker. Read more of this post

Korean Shipping Lines Face Cash Crunch After Expansion

Korean Shipping Lines Face Cash Crunch After Expansion

South Korea’s three biggest shipping companies face a cash crunch as 3 trillion won ($2.8 billion) of bonds are due for repayment in the next two years amid mounting losses from a global slump in rates to carry cargo. Hanjin Shipping Co. (117930), Hyundai Merchant Marine Co. (011200) and STX Pan Ocean Co. (028670) are all forecast to post losses in 2013 for a third consecutive year, further denting the combined 1.5 trillion won of cash and near cash items they had as of the end of June. The companies need to repay 1.4 trillion won of bonds next year and 1.6 trillion won the year after. Read more of this post

Will Shanghai Luxury Rides Rival U.S.? Car Makers Bet Buyers Want Same in China as in U.S.

Will Shanghai Luxury Rides Rival U.S.?

Car Makers Bet Buyers Want Same in China as in U.S.

JOSEPH B. WHITE

Nov. 13, 2013 12:05 a.m. ET

When it comes to luxury cars, consumers in Chicago have more in common with Shanghai than Stuttgart. That is the bet that Ford Motor Co. F +2.27% is placing with a new Lincoln luxury model. And many of its rivals in the premium car business are making the same call. Lincoln, best known for cushy, plus-size vehicles, is expected to unveil on Wednesday a new small sport-utility vehicle called the MKC. It will go on sale starting next year in largely identical versions for in the U.S. and China. It won’t be sold in Europe. Read more of this post

Crocs Considers Ways to Go Private; Crocs has struggled amid shifting fashion tastes and tried to expand into in high-heels and boots. Crocs

Crocs Considers Ways to Go Private

Sales, Stock Price Remain Soft at Maker of Colorful Plastic Clogs

Crocs has struggled amid shifting fashion tastes and tried to expand into in high-heels and boots.

DANA MATTIOLI And MIKE SPECTOR

Nov. 13, 2013 12:14 p.m. ET

Crocs Inc. CROX +9.76% is trying a leveraged buyout on for size. The footwear maker, famous for its colorful plastic clogs, is considering going private, said people familiar with the matter. The company’s board has invited a small group of private-equity firms to present their ideas for a buyout, according to one of the people. The talks may go nowhere, this person cautioned. Read more of this post

In Amazon and Walmart’s Battle for Dominance, Who Loses Out?

In Amazon and Walmart’s Battle for Dominance, Who Loses Out?

Nov 13, 2013 Strategic Management North America

In the retail realm, it’s a clash of the titans: Walmart, the world’s largest retailer, versus Amazon, the online giant that aspires to be “the everything store.” Both are slashing prices and increasing free, same-day and other enticing delivery-and-return services in pursuit of market domination. Amazon’s online savvy and forbearance of profit-taking are well known. Walmart, with its vast bricks-and-mortar network, is finally getting serious about e-commerce. Read more of this post

Gucci’s Owner Kering Sees Very Significant Profit Drop on La Redoute, Puma

Kering Sees Very Significant Profit Drop on La Redoute, Puma

Kering SA (KER), the owner of Gucci, said it expects net income this year to drop “very significantly” because of costs related to its planned sale of mail-order unit La Redoute and one-time charges related to its Puma brand. Any “solution” for La Redoute “will have a significant impact on the net result from discontinued operations,” the Paris-based company also said in a statement today after the close of trading. Puma, the sporting-goods brand in which Kering is controlling shareholder, last week said it would book one-time charges of about 130 million euros ($175 million) this quarter. Read more of this post

Everyone has a price: Retailers are starting to charge different people different prices. The more you shop, the less you pay

Everyone has a price

November 11, 2013

Michael Baker

Retailers are starting to charge different people different prices. The more you shop, the less you pay. Charging different customers a different price for the same product is not exactly a new idea. The airlines have been doing it for ages, so have the hotel chains. They are simply exploiting the fact that different kinds of people have a different level of willingness to pay. Read more of this post

Asean can tussle with emerging economic giants

Asean can tussle with emerging economic giants

Thursday, Nov 14, 2013

Anita Gabriel

The Straits Times

If asean comes together as a single economic bloc by 2015, it would become a serious contender for investor dollars, compared with emerging economic giants China and India, said a leading economist yesterday. Mr Leif Eskesen of HSBC noted that, as a single entity, the 10-nation ASEAN bloc is home to about 600 million people and ranks as the eighth-largest economy in the world with a combined gross domestic product of around US$2 trillion (S$2.5 trillion). Read more of this post

Japan Passes First of Reforms to Reshape Power Industry

Japan Passes First of Reforms to Reshape Power Industry

Japan’s lawmakers approved a first step to weakening the monopolies of regional power utilities by setting up an independent body to coordinate supply and demand across the nation’s electricity grids. Legislation passed today by the upper house calls for the creation of the body by 2015, according to the Ministry of Economy, Trade and Industry. The step is a first move to reforming the power industry of the world’s third-largest economy after the March 2011 nuclear disaster. Read more of this post

Teva to Pay Israel $565 Million in ‘Trapped Profits’ Tax Accord; joins fertilizer maker Israel Chemicals in releasing profits accumulated since 2005 under a law designed to encourage investments

Teva to Pay Israel $565 Million in ‘Trapped Profits’ Tax Accord

Teva Pharmaceutical Industries Ltd. (TEVA) agreed to pay Israel 2 billion shekels ($565 million) in taxes, joining fertilizer maker Israel Chemicals Ltd. in releasing profits accumulated since 2005 under a law designed to encourage investments. Teva, Israel’s largest publicly-traded company, said the amount would be paid within the framework of the amendment 69 to the Law for the Encouragement of Capital Investments, according to a Business Wire statement. That includes another 336 million shekels paid in May, it said. In addition, Teva will pay about 840 million shekels for taxes during the years 2005 to 2011, it said. Read more of this post

Attack on Junk-Loan Excess Risks LBO Profits as U.S. Cracks Down

Attack on Junk-Loan Excess Risks LBO Profits as U.S. Cracks Down

Fees for bankers and payouts for leveraged-buyout funds are at risk of being crimped as federal regulators crack down on underwriting standards in the market for high-risk, high-yield loans. The government, in an annual review of bank credit, looked at a $429 billion sample of leveraged loans and found 42 percent were “criticized,” or classified as having a deficiency that might lead to a loss. Starting in September, it sent letters demanding banks draw up plans to improve the quality of their loans and a warning that regulators will pay close attention to high-risk loan performance in stress tests. Read more of this post

‘Fragile Five’ Struggle to Take Advantage of Fed Taper Reprieve

November 13, 2013, 3:49 AM

‘Fragile Five’ Struggle to Take Advantage of Fed Taper Reprieve

NATASHA BRERETON-FUKUI

The Federal Reserve’s decision in September to maintain for now its extraordinary support for the American economy has given emerging markets extra time to prepare for the U.S. central bank’s eventual policy tightening. The verdict is mixed on whether the “Fragile Five” — as Morgan Stanley dubbed India, Indonesia, Turkey, Brazil and South Africa – have done enough to prepare for the Fed’s eventual tapering, which some analysts now believe could come  as early as December. Read more of this post

As assets surge, bond investors worry over liquidity traps

As assets surge, bond investors worry over liquidity traps

10:30am EST

By Karen Brettell

NEW YORK (Reuters) – Asset managers’ bond holdings are surging as banks that traditionally facilitated trades in debt markets scale back, raising fears that increasingly one-sided markets are at a greater risk of frantic selloffs. Big U.S. companies, including Verizon (VZ.N: Quote,Profile, Research, Stock Buzz) and Apple (AAPL.O: Quote,Profile, Research, Stock Buzz), have been selling record numbers of bonds to seemingly insatiable demand, as unprecedented stimulus from central bank bond purchases makes borrowing favorable for big corporations and as investors stretch for higher returns. Read more of this post

Advisers Wary of New Crop of China ETFs; Advisers find reasons to be on guard about A shares

Advisers Wary of New Crop of China ETFs

Advisers find reasons to be on guard about A shares

MURRAY COLEMAN

Nov. 13, 2013 9:11 a.m. ET

The trickle of funds investing in China’s $1.2 trillion mainland stock market is starting to arrive, promising to redraw maps across emerging markets for foreign investors. Last week saw the debut of the first U.S.-listed exchange-traded fund to invest in so-called “A” shares from the world’s second-biggest economy. The launch of DeutscheDBK.XE -0.90% Asset & Wealth Management’s db X-trackers Harvest CSI 300 Index ETFASHR -1.51% (ASHR), with $108 million in seed money, marked the biggest initial capital investment for an equity ETF since 2007. Read more of this post

Korea to Lift Five-Year Ban on Short Selling Finance Stocks

Korea to Lift Five-Year Ban on Short Selling Finance Stocks

South Korea will allow investors to short sell financial stocks from tomorrow, signaling that regulators believe banks and insurers are strong enough to withstand the lifting of a ban imposed during the 2008 crisis. The restriction is being removed because equities have stabilized since July and the government wants to bolster capital markets, the Financial Services Commission said today in an e-mailed statement. Short sales occur when an investor sells borrowed securities in anticipation of a price decline. Read more of this post

Emerging Currencies Are Pressured Anew; Looming Fed Pullback Sparks Selloff

Emerging Currencies Are Pressured Anew

Looming Fed Pullback Sparks Selloff

ANJANI TRIVEDI

Updated Nov. 12, 2013 6:56 p.m. ET

Investors worried about a cutback to the Federal Reserve’s easy-money policies are withdrawing from some emerging markets, sparking a currency selloff that echoes last summer’s rout. The stronger-than-expected October U.S. jobs report, released on Friday, heightened expectations that the Fed could be just months away from scaling back, or tapering, its $85 billion a month of bond purchases. Taken together with other positive indicators about the U.S. economy, the jobs report spurred a rise in U.S. bond yields, which many money managers said lessens the allure of emerging markets. Read more of this post

State Companies Emerge as Winners Following Top China Meeting; Enterprises Fended Off Calls to Curb Their Influence

State Companies Emerge as Winners Following Top China Meeting

Enterprises Fended Off Calls to Curb Their Influence

BOB DAVIS And BRIAN SPEGELE

Nov. 13, 2013 9:25 a.m. ET

BEIJING—China’s biggest state-owned companies emerged as major winners following a meeting this week of top Communist Party leaders, who reaffirmed their “dominant role” in the economy in comments that suggested they have been able to fend off repeated calls to curb their enormous influence. Read more of this post

Thailand Spurns IMF’s Call to Rethink Rice-Purchase Program

Thailand Spurns IMF’s Call to Rethink Rice-Purchase Program

Thailand said that it will press on with a $21 billion rice-purchase program, spurning a call from the International Monetary Fund to end the loss-making intervention and telling the lender its approach is better. “The government has our ways to help farmers,” Finance Minister Kittiratt Na-Ranong told reporters in Bangkok today after the IMF released a macro-economic assessment of the country, known as an Article IV consultation. “We listened to different points of view but the IMF needs to profoundly understand the situation before giving theoretical comments,” he said, adding that he hadn’t yet read the report. Read more of this post

Great Rotation Seen Muted by Pension-Fund Demand: Credit Markets

Great Rotation Seen Muted by Pension-Fund Demand: Credit Markets

A shift by household investors from bonds into equities that Bank of America Corp. dubbed the great rotation is being muted as pension funds and insurers boost fixed-income assets to match future obligations. U.S. companies with the largest defined-benefit pensions increased allocations into fixed-income to 41.3 percent from 36 percent since 2010, putting a greater share into the market than into equities, according to JPMorgan Chase & Co. (JPM) analysts and data from actuarial and consulting firm Milliman. Life insurers are replacing maturing structured securities with corporate bonds, and sovereign-wealth funds with $4.3 trillion of assets are investing 90 percent of it into debt, the analysts said. Read more of this post