Indian stocks completed the longest weekly winning streak in almost two years to enter into a bull market after Europe moved closer to a bailout for Greece and overseas investors bought assets in the South Asian nation.
The BSE India Sensitive Index (SENSEX), or Sensex, gained 0.8 percent to 18,289.35 at the 3:30 p.m. close in Mumbai, making it Asia’s best performing stock measure. Bharat Heavy Electricals Ltd. (BHEL), the biggest power-equipment maker, jumped the most since July 2009. State Bank of India, the nation’s largest lender, surged to the highest level since July. Foreign investors bought a net $444 million of Indian stocks in two days to Feb. 16, taking their investment this year to $4.9 billion.
This rally is “liquidity driven,” Manishi Raychaudhuri, head of Indian equity research at BNP Paribas SA, said in an interview with Bloomberg UTV today. “This is typically the kind of inflow India gets over a span of four to five months and not one to two months. It’s been caused by massive inflows into emerging-market funds.”
The Sensex climbed 3.1 percent this week, a seventh consecutive weekly advance, the longest since the period ended April 9, 2010. The index has rallied 18 percent this year, reaching the highest level since August, as inflation slowed, the central bank cut lenders’ reserve requirements for the first time since 2009 and the rupee jumped from a record low.
The 30-company gauge has climbed 21 percent from a December low, surpassing the 20 percent threshold that signals a bull market. The gauge trades at 16.2 times estimated earnings, compared with 10.7 times on the MSCI Emerging Markets Index. The Sensex is the best performer in dollar terms after the Egypt’s EGX 30 Index this year among 93 benchmark indexes tracked by Bloomberg.
Global Economy
Jobless claims in the U.S. dropped to a four-year low and housing starts beat forecasts. European governments considered cutting rates on emergency loans to Greece and using European Central Bank contributions to plug a new financing gap in a second bailout, two people familiar with the talks said.
Bharat Heavy Electricals soared 6.7 percent to 303.55 rupees, its highest level since Nov. 15. Tata Power Co. (TPWR), the biggest electricity generator outside state control, increased 4.1 percent to 118.65 rupees, its third day of advance.
State Bank rose 2.8 percent to 2,417.05 rupees, extending this week’s climb to 11 percent. The stock has soared 49 percent this year, the second-most among the Sensex companies. Nearest rival ICICI Bank Ltd. (ICICIBC) added 1.3 percent to 981.6 rupees.
“We had a clear signal by the Reserve Bank that rate cuts are around the corner,” BNP Paribas’s Raychaudhuri said. “There’s been a gradual turnaround in the policy environment and the attention the government is paying in trying to accelerate the investment climate. It’s difficult to comment whether this is a secular bull run or not, but for the time being this is likely to continue.”
Rate Outlook
The Reserve Bank of India said the majority of external members on an advisory panel recommended an interest-rate cut last month, underscoring rising pressure to counter weakening growth in Asia’s third-largest economy.
Three of the seven external members suggested lowering the repurchase rate by 0.25 percentage point and one advised a half- point cut, the minutes of the Jan. 18 meeting released by the central bank today showed. Three recommended no change.
The interest-rate cycle has peaked after 13 increases between March 2010 and October 2011, Reserve Bank Deputy Governor Subir Gokarn said on Feb. 14 as data showed inflation in January at the slowest in more than two years.
The S&P CNX Nifty Index on the National Stock Exchange of India increased 0.8 percent to 5,564.30. The BSE 200 Index gained 0.7 percent to 2,262.14. Markets are closed on Feb. 20 for a public holiday.
Flows into emerging-market equity funds have reached $19 billion this year, compared with outflows of $34 billion in 2011, Citigroup Inc. analysts led by Markus Rosgen wrote in a report today, citing data compiled by EPFR Global.
“Emerging markets are beta plays on global markets,” Mark Matthews, head of research for Asia at Bank Julius Baer & Co., said in an interview with Bloomberg UTV today. “People feel they will get better returns in a bull market by being in an emerging market.”
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net
To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Saturday, February 18, 2012
Friday, February 17, 2012
Sensex Advances for Seventh Straight Week on Inflows, Enters Bull Market By Rajhkumar K Shaaw - Feb 17, 2012
Indian stocks completed the longest weekly winning streak in almost two years to enter into a bull market after Europe moved closer to a bailout for Greece and overseas investors bought assets in the South Asian nation.
The BSE India Sensitive Index (SENSEX), or Sensex, gained 0.8 percent to 18,289.35 at the 3:30 p.m. close in Mumbai, making it Asia’s best performing stock measure. Bharat Heavy Electricals Ltd. (BHEL), the biggest power-equipment maker, jumped the most since July 2009. State Bank of India, the nation’s largest lender, surged to the highest level since July. Foreign investors bought a net $444 million of Indian stocks in two days to Feb. 16, taking their investment this year to $4.9 billion.
This rally is “liquidity driven,” Manishi Raychaudhuri, head of Indian equity research at BNP Paribas SA, said in an interview with Bloomberg UTV today. “This is typically the kind of inflow India gets over a span of four to five months and not one to two months. It’s been caused by massive inflows into emerging-market funds.”
The Sensex climbed 3.1 percent this week, a seventh consecutive weekly advance, the longest since the period ended April 9, 2010. The index has rallied 18 percent this year, reaching the highest level since August, as inflation slowed, the central bank cut lenders’ reserve requirements for the first time since 2009 and the rupee jumped from a record low.
The 30-company gauge has climbed 21 percent from a December low, surpassing the 20 percent threshold that signals a bull market. The gauge trades at 16.2 times estimated earnings, compared with 10.7 times on the MSCI Emerging Markets Index. The Sensex is the best performer in dollar terms after the Egypt’s EGX 30 Index this year among 93 benchmark indexes tracked by Bloomberg.
Global Economy
Jobless claims in the U.S. dropped to a four-year low and housing starts beat forecasts. European governments considered cutting rates on emergency loans to Greece and using European Central Bank contributions to plug a new financing gap in a second bailout, two people familiar with the talks said.
Bharat Heavy Electricals soared 6.7 percent to 303.55 rupees, its highest level since Nov. 15. Tata Power Co. (TPWR), the biggest electricity generator outside state control, increased 4.1 percent to 118.65 rupees, its third day of advance.
State Bank rose 2.8 percent to 2,417.05 rupees, extending this week’s climb to 11 percent. The stock has soared 49 percent this year, the second-most among the Sensex companies. Nearest rival ICICI Bank Ltd. (ICICIBC) added 1.3 percent to 981.6 rupees.
“We had a clear signal by the Reserve Bank that rate cuts are around the corner,” BNP Paribas’s Raychaudhuri said. “There’s been a gradual turnaround in the policy environment and the attention the government is paying in trying to accelerate the investment climate. It’s difficult to comment whether this is a secular bull run or not, but for the time being this is likely to continue.”
Rate Outlook
The Reserve Bank of India said the majority of external members on an advisory panel recommended an interest-rate cut last month, underscoring rising pressure to counter weakening growth in Asia’s third-largest economy.
Three of the seven external members suggested lowering the repurchase rate by 0.25 percentage point and one advised a half- point cut, the minutes of the Jan. 18 meeting released by the central bank today showed. Three recommended no change.
The interest-rate cycle has peaked after 13 increases between March 2010 and October 2011, Reserve Bank Deputy Governor Subir Gokarn said on Feb. 14 as data showed inflation in January at the slowest in more than two years.
The S&P CNX Nifty Index on the National Stock Exchange of India increased 0.8 percent to 5,564.30. The BSE 200 Index gained 0.7 percent to 2,262.14. Markets are closed on Feb. 20 for a public holiday.
Flows into emerging-market equity funds have reached $19 billion this year, compared with outflows of $34 billion in 2011, Citigroup Inc. analysts led by Markus Rosgen wrote in a report today, citing data compiled by EPFR Global.
“Emerging markets are beta plays on global markets,” Mark Matthews, head of research for Asia at Bank Julius Baer & Co., said in an interview with Bloomberg UTV today. “People feel they will get better returns in a bull market by being in an emerging market.”
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net
To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
The BSE India Sensitive Index (SENSEX), or Sensex, gained 0.8 percent to 18,289.35 at the 3:30 p.m. close in Mumbai, making it Asia’s best performing stock measure. Bharat Heavy Electricals Ltd. (BHEL), the biggest power-equipment maker, jumped the most since July 2009. State Bank of India, the nation’s largest lender, surged to the highest level since July. Foreign investors bought a net $444 million of Indian stocks in two days to Feb. 16, taking their investment this year to $4.9 billion.
This rally is “liquidity driven,” Manishi Raychaudhuri, head of Indian equity research at BNP Paribas SA, said in an interview with Bloomberg UTV today. “This is typically the kind of inflow India gets over a span of four to five months and not one to two months. It’s been caused by massive inflows into emerging-market funds.”
The Sensex climbed 3.1 percent this week, a seventh consecutive weekly advance, the longest since the period ended April 9, 2010. The index has rallied 18 percent this year, reaching the highest level since August, as inflation slowed, the central bank cut lenders’ reserve requirements for the first time since 2009 and the rupee jumped from a record low.
The 30-company gauge has climbed 21 percent from a December low, surpassing the 20 percent threshold that signals a bull market. The gauge trades at 16.2 times estimated earnings, compared with 10.7 times on the MSCI Emerging Markets Index. The Sensex is the best performer in dollar terms after the Egypt’s EGX 30 Index this year among 93 benchmark indexes tracked by Bloomberg.
Global Economy
Jobless claims in the U.S. dropped to a four-year low and housing starts beat forecasts. European governments considered cutting rates on emergency loans to Greece and using European Central Bank contributions to plug a new financing gap in a second bailout, two people familiar with the talks said.
Bharat Heavy Electricals soared 6.7 percent to 303.55 rupees, its highest level since Nov. 15. Tata Power Co. (TPWR), the biggest electricity generator outside state control, increased 4.1 percent to 118.65 rupees, its third day of advance.
State Bank rose 2.8 percent to 2,417.05 rupees, extending this week’s climb to 11 percent. The stock has soared 49 percent this year, the second-most among the Sensex companies. Nearest rival ICICI Bank Ltd. (ICICIBC) added 1.3 percent to 981.6 rupees.
“We had a clear signal by the Reserve Bank that rate cuts are around the corner,” BNP Paribas’s Raychaudhuri said. “There’s been a gradual turnaround in the policy environment and the attention the government is paying in trying to accelerate the investment climate. It’s difficult to comment whether this is a secular bull run or not, but for the time being this is likely to continue.”
Rate Outlook
The Reserve Bank of India said the majority of external members on an advisory panel recommended an interest-rate cut last month, underscoring rising pressure to counter weakening growth in Asia’s third-largest economy.
Three of the seven external members suggested lowering the repurchase rate by 0.25 percentage point and one advised a half- point cut, the minutes of the Jan. 18 meeting released by the central bank today showed. Three recommended no change.
The interest-rate cycle has peaked after 13 increases between March 2010 and October 2011, Reserve Bank Deputy Governor Subir Gokarn said on Feb. 14 as data showed inflation in January at the slowest in more than two years.
The S&P CNX Nifty Index on the National Stock Exchange of India increased 0.8 percent to 5,564.30. The BSE 200 Index gained 0.7 percent to 2,262.14. Markets are closed on Feb. 20 for a public holiday.
Flows into emerging-market equity funds have reached $19 billion this year, compared with outflows of $34 billion in 2011, Citigroup Inc. analysts led by Markus Rosgen wrote in a report today, citing data compiled by EPFR Global.
“Emerging markets are beta plays on global markets,” Mark Matthews, head of research for Asia at Bank Julius Baer & Co., said in an interview with Bloomberg UTV today. “People feel they will get better returns in a bull market by being in an emerging market.”
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net
To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Tuesday, February 14, 2012
Asian Stocks Rise as Greek Bailout Progress, Yen’s Slide Boost Outlook By Yoshiaki Nohara - Feb 14, 2012
Asian stocks rose, trimming yesterday’s losses, as optimism Greece will commit to austerity measures and the yen’s drop to a three-month low against the dollar boosted the earnings outlook for Asian exporters.
Sony Corp. (6758), Japan’s No. 1 exporter of consumer electronics that gets 21 percent of its revenue in Europe, rose 3 percent. Elpida Memory Inc. (6665), Japan’s sole maker of memory chips, plunged 21 percent after saying it still hasn’t secured enough financing to stay afloat before an April debt deadline approaches. Westfield Group (WDC), a shopping mall operator, climbed 5.7 percent in Sydney after reporting its second-half profit jumped five- fold as property management and project income increased.
The MSCI Asia Pacific Index gained 0.5 percent to 125.59 as of 10:25 a.m. in Tokyo after falling 0.6 percent yesterday. Six of the 10 industry groups on the measure advanced. The Bank of Japan boosted its asset purchase program yesterday, pushing down the yen.
“Greece will buy time with a second bailout and avoid default, and the markets have been pricing that in,” said Takeru Ogihara, chief strategist in Tokyo at Mizuho Trust & Banking Co., a unit of Japan’s third-largest lender by market value. “The BOJ took stronger action than expected. Overseas investors seem to like it.”
Japan’s Nikkei 225 Stock Average advanced 1 percent. The MSCI Asia Pacific excluding Japan Index was gained 0.2 percent. Australia’s S&P/ASX 200 lost 0.3 percent, while South Korea’s Kospi Index rose 0.5 percent.
Greece Commitment
Futures on the Standard & Poor’s 500 Index fell 0.1 percent today. The index lost 0.1 percent in New York yesterday, paring an earlier decline of as much as 0.8 percent.
Exporters to Europe advanced as the leaders of Greece’s two biggest political parties, New Democracy’s Antonis Samaras and Pasok’s George Papandreou, will send written commitments today to the so-called troika to stand by austerity measures, a government official said yesterday. The assurance to the troika -- the International Monetary Fund, European Commission and European Central Bank -- was a condition of a 130 billion euro ($171 billion) bailout.
Japanese shares extended yesterday’s gains after the yen touched 78.54 per dollar yesterday, the lowest level since Nov. 1. The nation’s central bank unexpectedly added 10 trillion yen ($127 billion) to an asset-purchase program and set an inflation goal.
“The yen is retreating and the world is moving toward more monetary easing as shown by the BOJ, supporting equities,” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc.
The MSCI Asia Pacific Index gained 9.8 percent this year through yesterday, compared with a 7.4 percent advance by the S&P 500 and a 7.4 percent increase by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 14.1 times estimated earnings on average, compared with 12.9 times for the S&P 500 and 10.9 times for the Stoxx 600.
To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net
To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Sony Corp. (6758), Japan’s No. 1 exporter of consumer electronics that gets 21 percent of its revenue in Europe, rose 3 percent. Elpida Memory Inc. (6665), Japan’s sole maker of memory chips, plunged 21 percent after saying it still hasn’t secured enough financing to stay afloat before an April debt deadline approaches. Westfield Group (WDC), a shopping mall operator, climbed 5.7 percent in Sydney after reporting its second-half profit jumped five- fold as property management and project income increased.
The MSCI Asia Pacific Index gained 0.5 percent to 125.59 as of 10:25 a.m. in Tokyo after falling 0.6 percent yesterday. Six of the 10 industry groups on the measure advanced. The Bank of Japan boosted its asset purchase program yesterday, pushing down the yen.
“Greece will buy time with a second bailout and avoid default, and the markets have been pricing that in,” said Takeru Ogihara, chief strategist in Tokyo at Mizuho Trust & Banking Co., a unit of Japan’s third-largest lender by market value. “The BOJ took stronger action than expected. Overseas investors seem to like it.”
Japan’s Nikkei 225 Stock Average advanced 1 percent. The MSCI Asia Pacific excluding Japan Index was gained 0.2 percent. Australia’s S&P/ASX 200 lost 0.3 percent, while South Korea’s Kospi Index rose 0.5 percent.
Greece Commitment
Futures on the Standard & Poor’s 500 Index fell 0.1 percent today. The index lost 0.1 percent in New York yesterday, paring an earlier decline of as much as 0.8 percent.
Exporters to Europe advanced as the leaders of Greece’s two biggest political parties, New Democracy’s Antonis Samaras and Pasok’s George Papandreou, will send written commitments today to the so-called troika to stand by austerity measures, a government official said yesterday. The assurance to the troika -- the International Monetary Fund, European Commission and European Central Bank -- was a condition of a 130 billion euro ($171 billion) bailout.
Japanese shares extended yesterday’s gains after the yen touched 78.54 per dollar yesterday, the lowest level since Nov. 1. The nation’s central bank unexpectedly added 10 trillion yen ($127 billion) to an asset-purchase program and set an inflation goal.
“The yen is retreating and the world is moving toward more monetary easing as shown by the BOJ, supporting equities,” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc.
The MSCI Asia Pacific Index gained 9.8 percent this year through yesterday, compared with a 7.4 percent advance by the S&P 500 and a 7.4 percent increase by the Stoxx Europe 600 Index. Stocks in the Asian benchmark are valued at 14.1 times estimated earnings on average, compared with 12.9 times for the S&P 500 and 10.9 times for the Stoxx 600.
To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net
To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Monday, February 13, 2012
Oil Rises to One-Month High as Greek Approval of Austerity Plan By Mark Shenk - Feb 13, 2012
Oil rose to a one-month high after the Greek parliament approved an austerity plan, easing Europe’s debt crisis, and sanctions tightened on Iran. Technical issues halted electronic trading late in the session.
Futures climbed 2.3 percent and global equities advanced after passage of the package needed for 130 billion euros ($172 billion) in aid. Companies controlling more than 100 supertankers said they would stop loading cargoes from Iran, the second-biggest crude producer in the Organization of Petroleum Exporting Countries.
“We popped overnight on the Greek austerity measures and have maintained the gains,” said Stephen Schork, president of the Schork Group in Villanova, Pennsylvania. “Crude is aping the equity market. If equities continue to move higher, crude will follow.”
Crude oil for March delivery rose $2.24 to $100.91 a barrel on the New York Mercantile Exchange, the highest settlement since Jan. 10. Prices are up 18 percent from a year ago.
CME Group Inc.’s Globex crude and products markets were halted by technical issues, the company said on its website. Trading resumed at 3:15 p.m. New York time.
Brent oil for March settlement rose 62 cents, or 0.5 percent, to end the session at $117.93 a barrel on the London- based ICE Futures Europe exchange.
European Union finance ministers are scheduled to meet on Feb. 15 in Brussels to decide whether to approve the aid package. Resolution of the negotiations would help contain the threat that speculators will target debt-saddled countries, including Italy and Portugal.
‘Won’t Fix Greece’
“This won’t fix Greece but it does buy time,” said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis. “This time should be used to come up with an exit strategy for countries to leave the euro zone in a controlled fashion.”
The 27 EU member states accounted for about 16 percent of global oil demand in 2010, according to BP Plc’s annual Statistical Review of World Energy.
“The approval of the Greek austerity measures gave the euro a boost and sent equities higher,” said Chris Dillman, an analyst and broker at Tradition Energy in Stamford, Connecticut. “The news that shippers will stop loading Iranian cargoes is also driving the market higher.”
Stopping Shipments
Overseas Shipholding Group (OSG) said Feb. 10 the pool of 45 supertankers from seven owners in which its carriers trade will no longer call at Iran. Nova Tankers A/S and Frontline Ltd., with a combined 93 vessels, said Feb. 9 and Feb. 11 they won’t ship crude from the Persian Gulf nation.
The EU’s Jan. 23 agreement to embargo Iran’s oil starting in July because of its nuclear program extended the ban to ship insurance. With about 95 percent of the tanker fleet insured under rules governed by European law, fewer vessels will be able to load in Iran.
“Iran is what’s really pushing crude up,” said Christopher Bellew, a senior broker at Jefferies Bache Ltd. in London. “If Iranian exports are choked off because of the insurance issue, we will see higher prices.”
Iranian President Mahmoud Ahmadinejad said Feb. 11 he will unveil “major nuclear accomplishments” in coming days, state- run Press TV reported. Iran has threatened to block shipments through the Strait of Hormuz, a transit route for about 20 percent of the world’s globally traded oil.
Blaming Iran
Israeli Prime Minister Benjamin Netanyahu blamed Iran for two attacks on Israeli embassy personnel in India and Georgia. The Persian Gulf nation has blamed Israel for a series of deadly attacks on scientists involved in its nuclear program. Iran’s Supreme Leader Ayatollah Ali Khamenei pledged Feb. 3 to help “any nation or group that confronts the Zionist regime.”
Hedge funds and other large speculators increased bullish bets on oil by 4,440 contracts, or 2.2 percent, to 205,709 in the week ended Feb. 7, the U.S. Commodity Futures Trading Commission said in a weekly report Feb. 10.
Oil volume in electronic trading on the Nymex was 484,686 contracts as of 3:26 p.m. in New York. Volume totaled 653,655 on Feb. 10. Open interest was 1.49 million contracts, the highest level since Sept. 9.
To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net
To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Futures climbed 2.3 percent and global equities advanced after passage of the package needed for 130 billion euros ($172 billion) in aid. Companies controlling more than 100 supertankers said they would stop loading cargoes from Iran, the second-biggest crude producer in the Organization of Petroleum Exporting Countries.
“We popped overnight on the Greek austerity measures and have maintained the gains,” said Stephen Schork, president of the Schork Group in Villanova, Pennsylvania. “Crude is aping the equity market. If equities continue to move higher, crude will follow.”
Crude oil for March delivery rose $2.24 to $100.91 a barrel on the New York Mercantile Exchange, the highest settlement since Jan. 10. Prices are up 18 percent from a year ago.
CME Group Inc.’s Globex crude and products markets were halted by technical issues, the company said on its website. Trading resumed at 3:15 p.m. New York time.
Brent oil for March settlement rose 62 cents, or 0.5 percent, to end the session at $117.93 a barrel on the London- based ICE Futures Europe exchange.
European Union finance ministers are scheduled to meet on Feb. 15 in Brussels to decide whether to approve the aid package. Resolution of the negotiations would help contain the threat that speculators will target debt-saddled countries, including Italy and Portugal.
‘Won’t Fix Greece’
“This won’t fix Greece but it does buy time,” said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis. “This time should be used to come up with an exit strategy for countries to leave the euro zone in a controlled fashion.”
The 27 EU member states accounted for about 16 percent of global oil demand in 2010, according to BP Plc’s annual Statistical Review of World Energy.
“The approval of the Greek austerity measures gave the euro a boost and sent equities higher,” said Chris Dillman, an analyst and broker at Tradition Energy in Stamford, Connecticut. “The news that shippers will stop loading Iranian cargoes is also driving the market higher.”
Stopping Shipments
Overseas Shipholding Group (OSG) said Feb. 10 the pool of 45 supertankers from seven owners in which its carriers trade will no longer call at Iran. Nova Tankers A/S and Frontline Ltd., with a combined 93 vessels, said Feb. 9 and Feb. 11 they won’t ship crude from the Persian Gulf nation.
The EU’s Jan. 23 agreement to embargo Iran’s oil starting in July because of its nuclear program extended the ban to ship insurance. With about 95 percent of the tanker fleet insured under rules governed by European law, fewer vessels will be able to load in Iran.
“Iran is what’s really pushing crude up,” said Christopher Bellew, a senior broker at Jefferies Bache Ltd. in London. “If Iranian exports are choked off because of the insurance issue, we will see higher prices.”
Iranian President Mahmoud Ahmadinejad said Feb. 11 he will unveil “major nuclear accomplishments” in coming days, state- run Press TV reported. Iran has threatened to block shipments through the Strait of Hormuz, a transit route for about 20 percent of the world’s globally traded oil.
Blaming Iran
Israeli Prime Minister Benjamin Netanyahu blamed Iran for two attacks on Israeli embassy personnel in India and Georgia. The Persian Gulf nation has blamed Israel for a series of deadly attacks on scientists involved in its nuclear program. Iran’s Supreme Leader Ayatollah Ali Khamenei pledged Feb. 3 to help “any nation or group that confronts the Zionist regime.”
Hedge funds and other large speculators increased bullish bets on oil by 4,440 contracts, or 2.2 percent, to 205,709 in the week ended Feb. 7, the U.S. Commodity Futures Trading Commission said in a weekly report Feb. 10.
Oil volume in electronic trading on the Nymex was 484,686 contracts as of 3:26 p.m. in New York. Volume totaled 653,655 on Feb. 10. Open interest was 1.49 million contracts, the highest level since Sept. 9.
To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net
To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Sunday, February 12, 2012
SingTel Q3 Earnings Fall 9.6% on Costs, Bharti By Robert Fenner - Feb 12, 2012
Singapore Telecommunications Ltd. (ST), Southeast Asia’s biggest phone company, posted a 9.6 percent fall in third-quarter earnings on costs to retain domestic customers and a slump at its Bharti Airtel Ltd. (BHARTI) unit in India.
Net income fell to S$902 million ($717 million), or 5.7 Singapore cents a share, in the three months ended Dec. 31 from S$998 million, or 6.3 cents a year earlier, SingTel, as the Singapore-based company is known, said in a statement today. The result missed the S$951.5 million average of four analysts’ estimates compiled by Bloomberg.
SingTel’s margin, which measures profit as a proportion of sales, shrank 1.3 percentage points to 26 percent as selling and administrative expenses in Singapore surged 22 percent on higher costs to add and retain customers. Competition in Australia is curbing growth for its Optus unit and sliding earnings at part- owned Bharti are crimping profitability.
“The big disappointment here is the change in the cost structure and the decline in its margin,” said Theo Maas, who holds SingTel among the $5 billion he helps manage at Arnhem Investment Management Pty. in Sydney. “They have been quite aggressive in terms of handset subsidies.”
SingTel’s Australian traded shares fell 1.8 percent to A$2.25 at 11:03 a.m. in Sydney, extending this year’s decline to 4.6 percent.
Singapore, Australia
Third-quarter earnings before interest, tax, depreciation and amortization from Singapore operations fell 7 percent to S$547 million. Revenue rose 3 percent.
Mobile revenue rose 6 percent to S$491 million after the company added 61,000 customers and increased its market share to 46 percent.
Sydney-based Optus, which trails only Telstra Corp. (TLS) in Australia, posted a 2 percent rise in earnings to A$562 million ($601 million) as it added 182,000 customers.
Full-year forecasts were affirmed, with the company expecting “stable” earnings in Singapore and growth in Australia at “low single digit levels.”
“They have affirmed things are sound with the guidance,” said Arnhem’s Maas.
Regional Units
SingTel owns all of its Singapore and Australian phone businesses in addition to minority stakes in six other mobile operators with 434 million customers in more than 20 countries in Asia and Africa.
Third-quarter earnings from associates, such as Bharti, PT Telekomunikasi Selular in Indonesia and Advanced Info Service Pcl (ADVANC) in Thailand, fell 7.9 percent to S$449 million.
New Delhi-based Bharti, India’s largest wireless operator, last week posted a 22 percent decline in profit as customers curbed mobile-phone use amid rising call rates and it incurred costs for the for the expansion of 3G services. The contribution to SingTel fell 30 percent to S$128 million.
The earnings contribution to SingTel from Indonesia’s PT Telekomunikasi (TLKM) rose 5.6 percent to S$226 million and profit from Advanced Info, Thailand’s largest mobile-phone operator, advanced 23 percent.
To contact the reporter on this story: Robert Fenner in Melbourne at rfenner@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
®2012 BLOOMBERG L.P. ALL RIGHTS RESERVED.
Net income fell to S$902 million ($717 million), or 5.7 Singapore cents a share, in the three months ended Dec. 31 from S$998 million, or 6.3 cents a year earlier, SingTel, as the Singapore-based company is known, said in a statement today. The result missed the S$951.5 million average of four analysts’ estimates compiled by Bloomberg.
SingTel’s margin, which measures profit as a proportion of sales, shrank 1.3 percentage points to 26 percent as selling and administrative expenses in Singapore surged 22 percent on higher costs to add and retain customers. Competition in Australia is curbing growth for its Optus unit and sliding earnings at part- owned Bharti are crimping profitability.
“The big disappointment here is the change in the cost structure and the decline in its margin,” said Theo Maas, who holds SingTel among the $5 billion he helps manage at Arnhem Investment Management Pty. in Sydney. “They have been quite aggressive in terms of handset subsidies.”
SingTel’s Australian traded shares fell 1.8 percent to A$2.25 at 11:03 a.m. in Sydney, extending this year’s decline to 4.6 percent.
Singapore, Australia
Third-quarter earnings before interest, tax, depreciation and amortization from Singapore operations fell 7 percent to S$547 million. Revenue rose 3 percent.
Mobile revenue rose 6 percent to S$491 million after the company added 61,000 customers and increased its market share to 46 percent.
Sydney-based Optus, which trails only Telstra Corp. (TLS) in Australia, posted a 2 percent rise in earnings to A$562 million ($601 million) as it added 182,000 customers.
Full-year forecasts were affirmed, with the company expecting “stable” earnings in Singapore and growth in Australia at “low single digit levels.”
“They have affirmed things are sound with the guidance,” said Arnhem’s Maas.
Regional Units
SingTel owns all of its Singapore and Australian phone businesses in addition to minority stakes in six other mobile operators with 434 million customers in more than 20 countries in Asia and Africa.
Third-quarter earnings from associates, such as Bharti, PT Telekomunikasi Selular in Indonesia and Advanced Info Service Pcl (ADVANC) in Thailand, fell 7.9 percent to S$449 million.
New Delhi-based Bharti, India’s largest wireless operator, last week posted a 22 percent decline in profit as customers curbed mobile-phone use amid rising call rates and it incurred costs for the for the expansion of 3G services. The contribution to SingTel fell 30 percent to S$128 million.
The earnings contribution to SingTel from Indonesia’s PT Telekomunikasi (TLKM) rose 5.6 percent to S$226 million and profit from Advanced Info, Thailand’s largest mobile-phone operator, advanced 23 percent.
To contact the reporter on this story: Robert Fenner in Melbourne at rfenner@bloomberg.net
To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net
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