Bamboo Innovator

Copper Supply Glut Seen Tripling as Prices Sink 10%: Commodities

Copper Supply Glut Seen Tripling as Prices Sink 10%: Commodities

The worldwide glut of copper supply is poised to almost triple in 2014, driving prices to the lowest in at least three years at a time when the International Monetary Fund says economic growth will be weaker than forecast. The surplus will reach a 13-year high of 272,000 metric tons, according to data from Barclays Plc and the International Copper Study Group in Lisbon. Codelco and Freeport-McMoRan Copper & Gold Inc., the biggest producers, are among those scheduled to add supply next year. The metal will drop as low as $6,450 a ton in 2014, or 10 percent less than last week’s close, the median of 22 analyst estimates compiled by Bloomberg shows. Read more of this post

Lenders Adjust in Asia as Investment Banking Disappoints; Instead of Deals, Banks Are Touting Success in Businesses Like Cash Management, Cross-Border Transactions

Lenders Adjust in Asia as Investment Banking Disappoints

Instead of Deals, Banks Are Touting Success in Businesses Like Cash Management, Cross-Border Transactions

ENDA CURRAN

Oct. 13, 2013 2:35 p.m. ET

When Citigroup Inc. C -0.10% won a contract in 2012 from China Petroleum & ChemicalCorp. 600028.SH +0.68% , or Sinopec, to shuffle cash around the world for Asia’s biggest refiner, the agreement generated few headlines. But the U.S. bank says the deal has helped it win key roles on Sinopec’s bumper crop of bond offerings this year, which included the biggest from Asia in a decade. Read more of this post

Volatility Decline Evokes 2010 Kospi Rally of 28%: Korea Markets

Volatility Decline Evokes 2010 Kospi Rally of 28%: Korea Markets

The last time share-price swings in South Korea fell this low versus peers in emerging markets was May 2010, when the Kospi index surged 28 percent in 12 months. Volatility in the nation’s benchmark equity gauge has halved since July, with a measure of 30-day swings falling to 8.6 on Oct. 11 versus 14 for the MSCI Emerging Markets Index, data compiled by Bloomberg show. The International Monetary Fund says South Korea is among nations best placed to weather a cut in U.S. monetary stimulus because policy makers have room to boost government spending and reduce interest rates. Read more of this post

U.S. Risks Joining 1933 Germany in Pantheon of Deadbeat Defaults

U.S. Risks Joining 1933 Germany in Pantheon of Deadbeat Defaults

Reneging on its debt obligations would make the U.S. the first major Western government to default since Nazi Germany 80 years ago. Germany unilaterally ceased payments on long-term borrowings on May 6, 1933, three months after Adolf Hitler was installed as Chancellor. The default helped cement Hitler’s power base following years of political instability as the Weimar Republic struggled with its crushing debts. “These are generally catastrophic economic events,” said Professor Eugene N. White, an economics historian at Rutgers University in New Brunswick, New Jersey. “There is no happy ending.” Read more of this post

Najib Sees Malaysia Escaping Fitch Rating Cut: Southeast Asia

Najib Sees Malaysia Escaping Fitch Rating Cut: Southeast Asia

Prime Minister Najib Razak said he believes that Malaysia can avoid a cut to its credit rating while the government will try its “level best” to prevent a breach of its self-imposed sovereign debt ceiling. “We will manage it,” Najib said in an Oct. 11 interview in Putrajaya, the country’s administrative center near Kuala Lumpur. “We’re very closely monitoring how we manage our macro position as well as our fiscal and debt to make sure that we will not be downgraded.” Read more of this post

China Dairy Demand Drives Warrnambool Bid War; Australian dairy producers are attractive targets because the country’s mild winters reduce feeding costs for dairy herds

China Dairy Demand Drives Warrnambool Bid War: Real M&A

The race to sate Asia’s increasing appetite for dairy foods has made even the worst-performing producer in the region into the target of a bidding war.

Saputo Inc. (SAP), Canada’s largest dairy processor, agreed to pay $372 million for Warrnambool Cheese & Butter Factory Co. (WCB), topping a bid from Bega Cheese Ltd. (BGA) Warrnambool, which exports most of its produce to nations including China and Japan, is trading above Saputo’s Oct. 8 offer of A$7 a share. That shows some investors expect a higher proposal for Australia’s oldest dairy producer, said Canaccord Genuity Group Inc. Read more of this post

Singapore Exchange, south-east Asia’s biggest, plans to add circuit-breakers by early next year after a plunge in shares of three commodity companies erased $US6.9 billion ($7.3 billion) in market value over three days

Hard-hit Singapore Exchange to implement ‘safeguards’

October 14, 2013

Singapore Exchange, south-east Asia’s biggest, plans to add circuit-breakers by early next year after a plunge in shares of three commodity companies erased $US6.9 billion ($7.3 billion) in market value over three days. Under the proposal, trading of a stock will be halted for five minutes if it moves 10 per cent in either direction, the exchange said. It had sought public feedback on the plan in June. Read more of this post

Buyout Shops Gear Up to Spend in Asia; Private-Equity Firms Have Mountain of Cash to Spend but May Lack Attractive Targets

Buyout Shops Gear Up to Spend in Asia

Private-Equity Firms Have Mountain of Cash to Spend but May Lack Attractive Targets

CYNTHIA KOONS and ISABELLA STEGER

Oct. 13, 2013 3:27 p.m. ET

Private-equity firms are sitting on $120 billion in funds to be invested in Asia, the most cash they have ever had on hand. But the region’s small markets, tough governments and fierce competition for deals could make it hard for firms to invest all that money profitably, industry watchers say. Drawn by the promise of strong economic growth, investors have been pouring money into Asia for years, even though returns have lagged behind those in North America. Private-equity firms operating in Asia returned 6.5% in the year ended in March, compared with 12.7% in North America, according to data provider Preqin. In the five years ended in March, Asia funds had internal rates of return—a private-equity benchmark for the profitability of a deal—of just 3.9%, compared with 6.8% in North America. Read more of this post

Mississippi Plant Shows the Cost of ‘Clean Coal’; Mississippi Power, meant to showcase technology for generating clean electricity from low-quality coal, ranks as one of the most-expensive U.S. fossil-fuel projects ever

Mississippi Plant Shows the Cost of ‘Clean Coal’

REBECCA SMITH and CAMERON MCWHIRTER

Oct. 13, 2013 7:23 p.m. ET

DE KALB, Miss.—For decades, the federal government has touted a bright future for nonpolluting power plants fueled by coal. But in this rural corner of eastern Mississippi, the reality of so-called clean coal isn’t pretty. Mississippi Power Co.’s Kemper County plant here, meant to showcase technology for generating clean electricity from low-quality coal, ranks as one of the most-expensive U.S. fossil-fuel projects ever—at $4.7 billion and rising. Mississippi Power’s 186,000 customers, who live in one of the poorest regions of the country, are reeling at double-digit rate increases. And even Mississippi Power’s parent, Atlanta-based Southern Co.SO +0.29% , has said Kemper shouldn’t be used as a nationwide model. Read more of this post

Rediscovering Europe’s Charms in IPO Market

Updated October 13, 2013, 4:31 p.m. ET

Rediscovering Europe’s Charms in IPO Market

JOHN JANNARONE

These days, investors seeking the boldest menu of initial public offerings need a taste for the Old World. After a dry spell in 2012, Europe’s IPO market has bounced back. Some $20 billion in deals have priced so far this year, almost triple the amount from the same period last year, according to Dealogic. While the U.S. still leads with almost $40 billion of new issues, that is virtually unchanged from a year earlier. Furthermore, this year’s European issues have made buyers happy, rising an average of 19% since listing. Some sought-after issues like the U.K.’s Royal MailRMG.LN +37.88% have been screamers: the stock jumped 38% on its first day of trading Friday. Read more of this post

Decaying Bridges, Highways Raise Costs for Truckers, Manufacturers; America’s road to recovery may face a costly detour due to a fraying transportation network

A Slowdown on the Road to Recovery

Decaying Bridges, Highways Raise Costs for Truckers, Manufacturers

BOB TITA

Oct. 13, 2013 4:42 p.m. ET

America’s road to recovery may face a costly detour due to a fraying transportation network. One in nine of the country’s 607,380 bridges are structurally deficient and 42% of the country’s major urban highways are congested, according to an American Society of Civil Engineers estimate, the result of years of inadequate funding and deferred maintenance. Trucks ship the bulk of the country’s goods. But trucking companies and their customers complain those shipments are being rerouted—sometimes by hundreds of miles—or traveling at lower speeds over deteriorating or traffic-clogged highways. That causes higher costs for fuel, maintenance and other expenses, including drivers. Read more of this post

Debt Markets Don’t Drink from Stocks’ Half-Full Glass; Stocks Have Jumped on Debt-Deal Hopes, but Funding Markets Are on the Edge of Their Seat

October 11, 2013, 5:14 p.m. ET

Debt Markets Don’t Drink from Stocks’ Half-Full Glass

Stocks Have Jumped on Debt-Deal Hopes, but Funding Markets Are on the Edge of Their Seat

JUSTIN LAHART

While stock markets have jumped for joy over a possible debt-ceiling deal, short-term funding markets are still on the edge of their seat. Signs of a thaw in Washington’s budget standoff have sent the stock market into paroxysms of joy. But with the clock still ticking on the U.S. hitting its debt ceiling, short-term credit markets remain wary. Until an actual deal is struck, they could get warier still. Read more of this post

Indonesia seeks to get back its manufacturing mojo

Indonesia seeks to get back its manufacturing mojo

5:19pm EDT

By Randy Fabi and Jonathan Thatcher

BANDUNG, Indonesia (Reuters) – In PT Trisula International’s (TRIS.JK: Quote, Profile, Research, Stock Buzz) hangar-sized factory outside the western Indonesian city of Bandung, hundreds of workers stitch together clothes for some of the world’s top brands. Amid the clatter and hum of their machines are hopes for a renaissance that can restore Indonesia’s place among Asia’s big manufacturing economies, a status it lost in the mid-1990s. Read more of this post

Start-Ups Fill Void Left by Spain’s 26% Unemployment Rate

Start-Ups Fill Void Left by Spain’s 26% Unemployment Rate

The rush starts at about 8 p.m. at La Infinito. That’s when Antonio Rojas Fernandez and Paloma Perez Rodriguez’s Madrid cafe usually fills up, typically keeping them busy until midnight. While they have two part-timers to help prepare food and bus the dozen tables a few times a week, the couple hasn’t taken more than a day off each since opening in May 2012, five months after they lost their jobs. She was a teacher, while he installed television antennas. Read more of this post

Germany Sees Global Risk Shift to Emerging Economies

Germany Sees Global Risk Shift to Emerging Economies

Germany’s top finance officials said risks to global growth are shifting away from Europe and toward emerging economies, while they expressed confidence that U.S. policy makers will overcome their divide over the budget. The euro region has left its recession behind and is no longer at the center of attention of crisis-fixing efforts, Bundesbank President Jens Weidmann told reporters in Washington yesterday. Finance Minister Wolfgang Schaeuble, after holding talks with his U.S. counterpart Jacob J. Lew, said he hopes that the budget standoff in the U.S. will be solved in coming days. Read more of this post

China and Taiwan to Form Equity Exchange as Relations Improve

China and Taiwan to Form Equity Exchange as Relations Improve

China and Taiwan plan to set up a cross-strait equity exchange center in the mainland’s southeastern province of Fujian as relations between the two sides improve. The center may be funded by 10 institutions including China’s state-owned Xiamen Jinyuan Investment Group and a unit of Taiwan’s SinoPac Financial Holdings Co. (2890), SinoPac Chief Financial Officer Michael Chang said by phone today. “It’s an exchange for junior shares, aiming to help early stage or small companies in China to raise funds,” he said. Read more of this post

Sugar Mills Face Wider Losses as Elections Loom: Corporate India

Sugar Mills Face Wider Losses as Elections Loom: Corporate India

Sugar mills in India, the world’s biggest producer after Brazil, are facing wider losses as the government prods them to pay more for cane in a bid to woo farmers before elections. A glut of the sweetener has caused prices to slide to a 15-month low, prompting factories in the top two states accounting for 65 percent of the nation’s output to sell below cost, said Abinash Verma, director general of the Indian Sugar Mills Association. Losses at mills may mount if cane prices are raised for the crushing season starting this month, he said. Read more of this post

Bewildering Indian policies fuel needless coal imports

Bewildering Indian policies fuel needless coal imports

5:21pm EDT

By Matthias Williams and Malini Menon

NEW DELHI (Reuters) – Tata Power’s (TTPW.NS: Quote,Profile, Research, Stock Buzz) 1,050 Megawatt power station in the state of Jharkhand is a textbook case of the absurd results that India’s 1970s-era coal supply laws can produce, and why power utilities are lobbying the government to change them. The Maithon power station is located in the heart of India’s vast coal belt, but a shortfall in local fuel supplies has forced Tata to import some of the coal for the plant all the way from Indonesia – an expensive and cumbersome alternative. Read more of this post

Lloyds CEO warns against housing “Help to Buy” bubble: FT

Lloyds CEO warns against housing “Help to Buy” bubble: FT

6:18pm EDT

(Reuters) – The chief executive of Lloyds Bank (LLOY.L:Quote, Profile, Research, Stock Buzz) has warned that the government’s “Help to Buy” mortgage scheme will risk creating a dangerous bubble in property prices unless steps are taken to boost the supply of new housing and free up planning restrictions, The Financial Times reported. The FT quoted António Horta-Osório, the CEO of Lloyds as saying, “It is important that planning permits, building authorizations and social housing projects are (liberalized) so that the increase in (mortgage) transactions does not lead to a substantial increase in house prices.” “I think the scheme should be focused outside London and the southeast. (In the rest of the country) you have nothing close to a housing bubble,” the FT quoted him as saying. Lloyds, which is 33 percent owned by the British government, could not be reached immediately for comment. Lloyds, along with RBS (RBS.L: Quote, Profile, Research, Stock Buzz), HSBC (HSBA.L: Quote, Profile,Research, Stock Buzz), Santander UK (SAN.MC: Quote, Profile, Research, Stock Buzz) and Barclays (BARC.L: Quote, Profile, Research, Stock Buzz), has already signed up for scheme which, in exchange for a fee, will give banks greater protection against losses. The only big lender yet to commit is the customer owned Nationwide (POB_p.L: Quote, Profile, Research,Stock Buzz), one of the few lenders already offering mortgages to buyers with small deposits.

London Wealthy Leave for Country Life as Prices Rise

London Wealthy Leave for Country Life as Prices Rise

It took more than a year for Mark Hudson to find his six-bedroom home in the English countryside. Within weeks of moving in, he got a bid that topped the 1.75 million pounds ($2.8 million) the property cost. “Somebody called offering a significantly higher sum,” said Hudson, a 55-year-old manager at a publishing company, who in August swapped his home in Clapham, a London district favored by young bankers and lawyers, for Dorset, the farm-dotted county 125 miles (202 kilometers) southwest of London that was the setting for Thomas Hardy’s Tess of the D’Urbervilles. “It looks like we caught it just at the right time,” he said. Read more of this post