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India Equity Movers: Cairn India, HDFC Bank, Himachal Futuristic

http://www.bloomberg.com/news/2011-04-19/india-equity-movers-cairn-india-hdfc-bank-himachal-futuristic.html

The following companies had unusual price changes in India trading. Stock symbols are in parentheses and share levels are as of 9:46 a.m. in Mumbai. The Bombay Stock Exchange Sensitive Index, or Sensex, was little changed at 19,079.37. The BSE 200 Index was also little changed at 2,362.15. Cairn India Ltd. (CAIR) added 2.3 percent to 343.85 rupees. About 282.3 million shares, or 14.8 percent of its equity, changed hands in three block deals on the Bombay Stock Exchange, according to Bloomberg data. The buyers and sellers weren’t immediately known. HDFC Bank Ltd. (HDFCB) gained 1.5 percent to 2,346.95 rupees. India’s third-largest lender by market value reported a net income of 11.1 billion rupees for the quarter ended March 31. The bank’s board also approved a plan to split each share into five. The earnings were announced yesterday after the market closed. Himachal Futuristic Communications (HMFC) Ltd jumped 6.9 percent to 16.14 rupees. The telephone equipment maker replaced Indiabulls Real Estate Ltd. (IBREL) in the BSE 500 Index of the Bombay Stock Exchange, according to a statement from the bourse yesterday. Indiabulls Real Estate, replaced by Coal India Ltd. in the index, fell 1.3 percent to 142.75 rupees. Sunflag Iron & Steel Co. (SUNF) rose 3.3 percent to 30.95 rupees, set for its highest closing level since Oct. 28. About 5 million shares, or 3.1 percent of the iron and steel products maker’s equity, changed hands in two transactions on the National Stock Exchange, according to Bloomberg data. The buyers and sellers weren’t immediately known. To contact the reporter on this story: Ameya Karve in Mumbai at akarve@bloomberg.net To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net .

Cut Diamonds Outpacing Gold Still `Grossly Undervalued': Chart of the Day

http://www.bloomberg.com/news/2011-04-19/-grossly-undervalued-diamonds-outpacing-gold-chart-of-the-day.html

Polished diamonds, beating gold this year, remain “grossly undervalued” relative to uncut gems and will extend gains on booming demand in India and China, WWW International Diamond Consultants Ltd. said. The CHART OF THE DAY shows polished gems trailing rough diamonds, which rose to an all-time high this year, according to data compiled by polishedprices.com, as supply from mine operators fails to keep up with Asian demand. Cut stones, up 9.6 percent so far in 2011, have still outperformed gold, which climbed to a record $1,497.90 an ounce on April 18. “Rough has just gone ballistic,” said Charles Wyndham, founder of WWW International and formerly a director at the sales operations of De Beers. “Polished is grossly undervalued. If people are pushing rough skywards because of an anticipated shortage, at the very least the same should apply to polished.” China recently surpassed Japan as the second-biggest buyer of diamonds, behind the U.S., which consumed 38 percent of production in 2010, according to De Beers. Demand in India grew 31 percent last year, while in China it jumped 25 percent and the U.S. market expanded 7 percent, it said in February. While rough prices advanced to a record this year, polished gems are below their 1979 all-time high, polishedprices.com data show. Cut stones have risen above levels reached in 2008 before a slump in demand spurred by the global financial crisis. Rough prices may gain an annual 15 percent to 20 percent in the next two to three years, according to Namakwa Diamonds Ltd. (NAD) Chief Executive Officer Nico Kruger. “Prices are overheated,” he said yesterday. “There is just no supply, so what else must the big cutters and polishers do? They must buy.” To contact the reporter responsible for this story: Maria Kolesnikova at mkolesnikova@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

Novartis Withdraws Joicela Marketing Application in Europe

http://www.bloomberg.com/news/2011-04-19/novartis-withdraws-joicela-marketing-application-in-europe-1-.html

Novartis AG (NOVN) withdrew its application to market the Joicela pain pill in the European Union because the Swiss company wasn’t able to provide information to regulators in the time allowed. Joicela was intended to be used to relieve pain in patients with osteoarthritis of the knee and hip who don’t carry a specific genetic marker, the European Medicines Agency said in a statement today. The withdrawal won’t bias the regulator against a subsequent application for the product, the agency said. The EU filing was the second attempt by Novartis, Europe ’s second-largest drugmaker by sales, at re-introducing the drug. The Basel-based company planned to re-submit the treatment, which belongs to a group of painkillers known as COX-2 inhibitors, to U.S. regulators in 2009 along with a genetic test to detect patients prone to liver damage, Novartis said at the time. The U.S. Food and Drug Administration said in September 2007 that it couldn’t approve the treatment, also known as lumiracoxib or Prexige, for patients suffering from osteoarthritis because studies showed too high a rate of liver damage. European regulators halted sales of the drug months later. The application withdrawal “has nothing to do with biomarkers or genetic tests,” Eric Althoff , a spokesman for Novartis, said in a telephone interview. “COX-2s remain a challenging environment.” To contact the reporter on this story: Eva von Schaper in Munich at evonschaper@bloomberg.net To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

Wheat Advances for a Third Day on Deteriorating Crop Conditions in U.S.

http://www.bloomberg.com/news/2011-04-19/wheat-futures-gain-a-third-day-as-u-s-crop-condition-worsens-corn-rises.html

Wheat rose for a third day in Chicago as worsening winter-crop conditions in the U.S., the largest exporter, and delayed spring-crop plantings fueled supply concerns amid strengthening demand. About 38 percent of the winter-wheat crop was in poor or very poor condition as of April 17, up from 36 percent a week earlier and 6 percent a year earlier, the U.S. Department of Agriculture said yesterday. Dry weather in the past week from central Kansas to Texas hurt crops. About 5 percent of the spring-wheat crop was sown , against 18 percent a year earlier and the prior five-year average of 12 percent, the USDA said. “Wheat prices rose sharply on the news of the slow spring- wheat planting and on the further news that the condition of the current winter-wheat crop is really quite bad,” economist Dennis Gartman said in his daily Gartman Letter. Wheat for July delivery gained 12.75 cents, or 1.6 percent, to $8.235 a bushel by 10:54 a.m. London time on the Chicago Board of Trade. Prices reached a one-week high of $8.2475 after jumping 3.9 percent yesterday. Milling wheat for May delivery traded on NYSE Liffe in Paris climbed 6.25 euros, or 2.5 percent, to 252.25 euros ($360.01) a metric ton. Wheat output in Texas, the fifth-largest U.S. grower, may plunge 61 percent to 50 million bushels as the dry spell damages plants and farmers abandon fields, said Mark Welch, a grain- marketing economist at Texas A&M University. About 68 percent of the Texas winter-wheat crop was in poor to very poor condition, the USDA said yesterday. Lowest Since 2006 Yields in the U.S. may drop to 38 or 39 bushels an acre, the lowest since 2006, without improved weather conditions, said Dennis Delaughter, owner of Progressive Farm Marketing Inc. in Edna, Texas. The national yield has been below 40 bushels only twice in the past 13 years, USDA data show. Wheat inspected for export at U.S. ports rose 24 percent from a week earlier to 35.7 million bushels in the week to April 14, the USDA said yesterday. Corn for July delivery rose for a second day in Chicago , advancing 1.75 cents, or 0.2 percent, to $7.6125 a bushel. Sowing of the grain in the U.S., the largest grower and exporter, fell behind last year’s pace. About 7 percent of the corn crop was planted as of April 17, down from 16 percent a year earlier , the USDA said yesterday. At least a third of the crop should be sown by May 1 or yield potential may be diminished, said Greg Grow, director of agribusiness for Archer Financial Services Inc. in Chicago. Soybeans for July delivery fell 2.5 cents, or 0.2 percent, to $13.5325 a bushel after two advances in a row. China’s soybean crushers canceled more than 10 cargoes of the oilseed this month to cut growing losses for processing, state- affiliated researcher Grain.gov.cn said in a report today. Crushers have also delayed shipments of more than 20 cargoes, it said. The cancellations and delays will likely lower China ’s imports in the year through Sept. 30 to about 53 million tons, compared with 57 million tons estimated by the USDA, the researcher said. The Asian country is the world’s biggest soybean importer. To contact the reporters on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net ; Tony C. Dreibus in London at tdreibus@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

Telefonica Job-Cut Cost Should Rise to Limit Price to State, Ministers Say

http://www.bloomberg.com/news/2011-04-19/telefonica-job-cut-cost-should-rise-to-limit-price-to-state-ministers-say.html

Telefonica SA (TEF) and other profitable Spanish companies should pay more costs when they eliminate jobs, reducing the burden on state benefits, Finance Minister Elena Salgado said. “Any profitable company will have the right to reorganize itself but that same company must bear the cost,” Salgado said in a radio interview with Cadena Ser today. She was responding to a question about Madrid-based Telefonica, which has said it plans to cut about 20 percent of its workforce in Spain within the next three years as it targets growth in Latin America to make up for declining sales at home. Profitable companies such as Telefonica, Spain’s former phone monopoly, should contribute to the costs borne by the state unemployment-protection system, Labor Minister Valeriano Gomez said yesterday in an interview with state-owned radio station RNE. Telefonica’s job cuts aren’t appropriate for a socially responsible company as it also announced a multimillion-euro bonus plan for senior executives, Gomez said. “When a company of a sufficient size has a sufficiently high level of profit and carries out job cuts that include firings with the use of unemployment benefits , the company should contribute to reducing the cost to the unemployment- protection system, with the company itself paying the cost of the unemployment benefit,” Gomez said. -- with assistante from Emma Ross-Thomas. Editors: Robert Valpuesta, David Risser. To contact the reporters on this story: Manuel Baigorri in Madrid at mbaigorri@bloomberg.net ; Charles Penty in Madrid at cpenty@bloomberg.net To contact the editor responsible for this story: Angela Cullen at acullen8@bloomberg.net

Ameriprise, Investors Seek Court Approval of Lawsuit Accord

http://www.bloomberg.com/news/2011-04-19/ameriprise-securities-america-agree-to-end-investor-suit-for-80-million.html

Ameriprise Financial Inc. (AMP) , two of its Securities America units and a group of investors who sued them asked a U.S. judge to approve a proposed $80 million cash settlement. The investors had bought stock and partnership interests in Provident Royalties LLC, an owner of working interests in oil and natural gas properties, through Securities America from September 2006 through January 2009. They also bought notes issued by so-called special purpose entities affiliated with Medical Capital Holdings Inc., a company that bought accounts receivable, according to papers filed yesterday with U.S. District Judge W. Royal Furgeson in Dallas. Those who invested in Medical Capital, which was later sued by the U.S. Securities and Exchange Commission for misappropriation of investor funds, lost about $284 million on the special purpose notes. Securities America sold about 37 percent of those notes, according to the investors’ filing. Provident investors lost $46 million when that company went bankrupt. “The class action settlement will allow investors to recover a meaningful percentage of their losses,” their attorneys told the court. Ameriprise, a Minneapolis-based company spun off from American Express Co. in 2005, and its Securities America units have also agreed to pay $70 million to investors who filed claims for arbitration and rather than in the courts. The lead case is case is Billitteri v. Securities America Inc., 09cv1568, U.S. District Court, Northern District of Texas (Dallas). To contact the reporters on this story: Andrew Harris in Chicago at aharris16@bloomberg.net ; Tom Korosec in Dallas at tkorosec@sbcglobal.net. To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

Chinese Stocks Slump on Inflation, U.S. Credit Rating Concerns

http://www.bloomberg.com/news/2011-04-19/china-stocks-drop-most-in-2-months-on-s-p-cut-inflation-concern.html

China ’s stocks fell the most in two months on concern inflation will spur the government to keep tightening monetary policy and as Standard & Poor’s Ratings Service cut its outlook on U.S. credit, fueling concern that a recovery in the global economy may slow. Jiangxi Copper Co., China’s biggest producer of the metal, dropped 3.4 percent after copper prices slid for a sixth day in New York. China Vanke Co. paced losses for developers after Credit Suisse Group AG said the government may boost measures to curb property investment. Henan Shuanghui Investment & Development Co., the biggest publicly traded food producer, plunged by the 10 percent daily limit amid an investigation into illegal additives. “The U.S credit outlook cut will have short-term negative effects on investors’ confidence,” said Mei Luwu, a Shenzhen- based fund manager of Lion Fund Management Co., which oversees more than $7.8 billion. “The risks have been there and the market is plunging now that they are exposed.” The Shanghai Composite Index slid 58.3 points, or 1.9 percent, to 2,999.04 at the 3 p.m. close, the biggest slump since Feb. 22. The CSI 300 Index (SHSZ300) declined 1.9 percent to 3,295.81. The Shanghai Composite has climbed 6.8 percent this year, the best performer among the biggest Asian markets, as optimism about growth in the world’s second-largest economy and corporate earnings outweighed measures to cool inflation. The central bank has announced 10 reserve-requirement ratio increases since the start of 2010 and raised interest rates four times. U.S. Outlook In New York, the Standard & Poor’s 500 Index fell 1.1 percent yesterday, its biggest retreat since March, after S&P lowered its outlook on U.S. debt to “negative.” The ratings agency said that more than two years after the beginning of the financial crisis, U.S. policy makers haven’t agreed on a strategy to reverse recent fiscal deterioration or address longer-term fiscal pressures. Jiangxi Copper slid for a seventh day, losing 3.4 percent to 37.71 yuan. Yunnan Copper Industry Co. (000878) fell 3.5 percent to 25.09 yuan. PetroChina Co., the nation’s biggest oil producer, slipped 2.1 percent to 11.86 yuan. China Shenhua Energy Co., the listed unit of China’s biggest coal producer, dropped 4.6 percent to 29.32 yuan. July-delivery copper on the Comex in New York lost 0.2 percent to $4.2085 a pound, erasing gains of as much as 0.8 percent earlier. June-delivery futures in Shanghai declined as much as 2 percent to 69,630 yuan a ton, the lowest level since March 17. Reserve Ratio U.S. President Barack Obama unveiled a plan on April 13 to cut $4 trillion in cumulative deficits within 12 years through a combination of spending cuts and tax increases. The U.S. House passed a Republican budget on April 15 that would cut spending by more than $6 trillion over a decade. The People’s Bank of China said on April 17 it will lift lenders’ reserve requirements following government reports showing inflation rose 5.4 percent last month. That exceeded the median forecast in Bloomberg News surveys of economists for 5.2 percent. “We expect to see fluctuations around 3,000 for the index as the March inflation data boosted concerns over tightening measures,” said Mei. China Vanke, the largest developer, declined 2 percent to 8.78 yuan. Gemdale Corp. (600383) sank 2.5 percent to 6.76 yuan. Data showing 50 of 70 cities recorded a month-on-month increase in property prices invites more tightening policies, Credit Suisse said. Investment Increase Foreign direct investment surged 33 percent in March, adding $12.5 billion to China’s economy , the Ministry of Commerce said today. The People’s Bank of China will raise interest rates twice more in the next 12 months as capital inflows complicate efforts to tame inflation, according to the cost to fix borrowing costs in the swap market. Two-year contracts indicate the one-year deposit rate will be boosted 58 basis points in the next 12 months to 3.83 percent after four increases the past year, data compiled by Bloomberg show. On April 6, they projected a rate of 3.71 percent. Foreign reserves jumped $197 billion in the first quarter to a record $3 trillion. Barton Biggs , a former chairman of Morgan Stanley Asset Management, said the move by China’s central bank, which indicates the country is going to do whatever it takes to cool inflation, makes him nervous about his bullish position on Asia and global equities. ’Nervous’ About Stocks “China is the world’s locomotive,” he said. “It’s making me nervous about my commitment to Asia, making me nervous about my commitment to stocks in general, not just China.” The longest rally in developing-nation stocks since 1997 may be ending as higher interest rates in Brazil , Russia , India and China curb earnings growth. For the first time in two years, emerging-market analysts are cutting profit estimates more than they’re raising them, consumer stocks are trailing energy producers and shares of smaller companies are losing to larger equities, data compiled by Bloomberg and Morgan Stanley show. Henan Shuanghui fell 10 percent to 70.15 yuan on their first day of trading since a monthlong suspension. The company yesterday confirmed a China Central Television report that an affiliate purchased pigs fed with a banned additive that induces the growth of lean meat. “The incident will affect Shuanghui’s sales by between 2 billion yuan and 4 billion yuan ($612 million) in 2011,” Tong Xun and Man Zhen, Shanghai-based analysts at Shenyin & Wanguo Securities Co., wrote in a report today. Lion Fund’s Mei is cautious on small-cap food producers and health-care companies, while favoring banks, developers, coal producers and chemical companies. “Overall, we are positive on the A-share market for the second quarter given the undeterred economic growth,” Mei said. “Valuations and the earnings outlook make some A-share companies very attractive investments globally.” --Irene Shen. Editors: Richard Frost, Allen Wan To contact Bloomberg News staff for this story: Irene Shen in Shanghai at +86-21-6104-3049 or ishen4@bloomberg.net To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net

Indonesia's Regulator Says 21 Extra LNG Cargoes May Go to Quake-Hit Japan

http://www.bloomberg.com/news/2011-04-19/indonesia-s-regulator-says-21-extra-lng-cargoes-may-go-to-quake-hit-japan.html

Indonesia , the world’s third- largest exporter of liquefied natural gas, may send as many as 21 additional cargoes of the fuel to Japan this year, an official at the nation’s energy regulator said. PT Pertamina, Indonesia’s state oil and gas company, has agreed to ship seven cargoes from its Bontang plant in East Kalimantan province to Tohoku Electric Power Co. in April and May, said an official at BPMigas , asking not to be identified as the sales haven’t been made public. Three cargoes for May to June delivery are under negotiation with buyers and 11 are available for June to December, the official said. Nanang Untung, senior vice president of gas at Jakarta- based Pertamina, said the plan is being discussed by the government, declining to give further details. Gde Pradnyana, a spokesman for BPMigas, said the shipments will come from cargoes slated for the spot markets. Japan, which relies on fuel imports for most of its energy needs, is seeking to expand supply of alternative sources after the nation’s biggest earthquake recorded on March 11 forced the shutdown of 20 percent of the country’s nuclear output. The nation consumed 35 percent of the world’s LNG in 2009, more than any other country, according to BP Plc’s Statistical Review. Indonesia may divert cargoes to Japan from BP’s Tangguh LNG plant in West Papua province that were originally to be shipped to Sempra Energy (SRE) ’s terminal in Mexico ’s Baja California , Energy and Mineral Resources Minister Darwin Saleh said March 23. LNG is natural gas chilled to liquid form for transportation by ships to places not connected by pipelines. Qatar and Malaysia are the world’s largest and second-biggest exporters of the fuel, respectively. To contact the reporters on this story: Bambang Djanuarto in Jakarta at bdjanuarto@bloomberg.net ; Yoga Rusmana in Jakarta at yrusmana@bloomberg.net To contact the editor responsible for this story: Clyde Russell at crussell7@bloomberg.net .

Ethanol Declines as Corn, Gasoline Slide on Demand Concerns

http://www.bloomberg.com/news/2011-04-19/ethanol-declines-as-corn-gasoline-slide-on-demand-concerns.html

Ethanol futures declined in Chicago as corn and gasoline fell on concern that higher prices will reduce demand. The biofuel slid 0.4 percent on speculation that gasoline pump prices, which averaged $3.835 a gallon yesterday according to AAA, will crimp demand and that corn prices, which have gained 19 percent this year, will curtail export. Ethanol is made from corn in the U.S. and blended with gasoline. “Gasoline and corn were both lower and ethanol just followed along,” said Matt Janney, a broker at Citigroup Global Markets Inc. in Chicago. “People are trying to talk waning demand right now.” Denatured ethanol for May delivery slipped 1 cent to $2.621 a gallon on the Chicago Board of Trade. Prices have risen 10 percent this year. In cash market trading, ethanol was unchanged in the U.S. Gulf at $2.735 a gallon, and in New York the additive rose 1 cent, or 0.4 percent, to $2.70, according to data compiled by Bloomberg. Ethanol on the West Coast dropped 1.5 cents, or 0.6 percent, to $2.71 a gallon and in Chicago the alternative fuel increased 1.5 cents, or 0.6 percent, to $2.615. Corn futures for July delivery decreased 2.5 cents, or 0.3 percent, to close at $7.57 a bushel in Chicago. One bushel distills into at least 2.75 gallons of the fuel. Gasoline for May delivery fell 1.97 cents, or 0.6 percent, to settle at $3.2331 a gallon on the New York Mercantile Exchange. The contract covers reformulated gasoline, or RBOB, which is made to be blended with ethanol before delivery to filling stations. Average ethanol mills in Iowa are losing 2 cents on every gallon produced, while plants in Illinois are breaking even on a spot basis, according to Ag Trader Talk, an online grains information service in Clive, Iowa. To contact the reporter on this story: Mario Parker in Chicago at mparker22@bloomberg.net. To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net .

Automaker CEOs Court Customers in Shanghai Instead of New York

http://www.bloomberg.com/news/2011-04-19/automaker-ceos-follow-customers-to-shanghai-instead-of-new-york.html

To see how Shanghai’s auto show has grown with the nation’s now world-leading vehicle market, just watch the bosses. While General Motors Co. (GM) Chief Executive Officer Dan Akerson spoke in New York yesterday on the eve of that city’s international auto show, his peers were on the other side of the world. Volkswagen AG (VOW) ’s Martin Winterkorn , Toyota Motor Corp. (7203) ’s Akio Toyoda , and Carlos Ghosn, who runs both Renault SA (RNO) and Nissan Motor Co., all went to the Shanghai show. Akerson visited China in February. The choices made by the chief executives reflect the growing significance of the world’s most populous nation. With about 17.2 million vehicles sold last year, China is about 50 percent bigger than the U.S. market, even while car ownership is 14 times more common in the U.S. than in China. “That’s it, isn’t it: Where are the CEOs?” said Michael Dunne, president of Dunne & Co. in Hong Kong. “People know that China is the world’s biggest market, but now it’s starting to sink in.” Jim Farley, Ford Motor Co. (F) ’s marketing chief, called this year’s Shanghai event “the most important auto show I’ve ever been to in my career.” China’s rise on the global auto scene will rank with the electrification of the automobile among the career highlights he said he hopes to be able to tell his grandchildren about some day. Ford CEO Alan Mulally isn’t scheduled to attend either show. Beetle Reveal Volkswagen revealed the redesign of its iconic Beetle in Shanghai, New York and Berlin, and Winterkorn was present for the ceremony in China. The world’s most profitable automaker in 2010 sent four executive board members to the Shanghai show and none to New York, said Peter Schwarzenbauer , sales chief for the automaker’s Audi AG unit. “We’re concentrating on Shanghai ,” he said. “The Q3 SUV is premiered to the world here -- that’s where we should be too.” Volvo Cars CEO Stefan Jacoby said in an interview in Shanghai that the growth of China’s passenger-car market was inconceivable a decade ago. “I remember times when I worked for VW -- and had been in charge of the Asia Pacific and China business -- that we could not imagine that the market would have the size of the German car market: 3 to 3.5 million,” he said. “Today it’s 13 million” passenger cars, and more than 17 million including commercial vehicles. China’s Zhejiang Geely Holding Group Co. bought Volvo Cars from Ford in August. ‘More Popular’ “The Shanghai show is getting bigger and more and more popular each year,” said Chen Hong, president of SAIC Motor Corp., which has partnerships with GM and VW that are the nation’s top manufacturers. “This shows the fast expansion and development of the China car market.” While vehicle sales growth slowed in China in February and March and the government has sought to discourage “lavish lifestyles,” the popularity of luxury vehicles has continued. Dieter Zetsche, CEO of Daimler AG (DAI) , which makes Mercedes- Benz and Maybach cars, attended the show. “Top management of a lot of major automakers are here,” said Klaus Maier, president and chief executive officer of Mercedes-Benz’s business in China. “It is getting very competitive” to get space for advertisement in newspapers such as China Daily, in which the German brand ran a glossy insert. Toyota’s Toyoda hadn’t committed to come to Shanghai in advance and eventually decided to attend. He said he appreciated the “support and encouragement of everyone here in China,” and that attending the show is fundamental to his role as CEO. “I feel it is my mission to work to provide ever-better cars to people around the world,” Toyoda said. “On this belief, I made this trip to China .” --Tian Ying, Liza Lin, Andreas Cremer, Makiko Kitamura, Yuki Hagiwara and Jamie Butters in Shanghai. Editors: Kevin Orland, James Callan. To contact Bloomberg News staff for this story: Liza Lin in Shanghai at +86-21-6104-3047 or llin15@bloomberg.net To contact the editor responsible for this story: Kae Inoue at kinoue@bloomberg.net

Sinopec Halts Fuel Exports to Ensure Domestic Supply Amid Refining Losses

http://www.bloomberg.com/news/2011-04-19/sinopec-halts-fuel-exports-on-shortage-as-refiners-make-loss-1-.html

China Petrochemical Corp., Asia ’s biggest oil refiner, halted fuel exports to ensure domestic supply as high crude costs and retail price caps cause private refiners to cut back on production. Sinopec Group, as the company is known, “stopped exporting to other regions apart from sustaining the basic resource needs of Hong Kong and Macau,” it said in its online newsletter today. The Beijing-based company will run its refineries at full capacity and cut petrochemical production to boost output of gasoline and diesel for domestic use, it said. China’s fuel inventories fell last month as consumption rose to a record on demand for travel, manufacturing and spring planting. Retail fuel prices increased an average 10 percent this year, according to Bloomberg calculations, while global crude oil climbed 17 percent. “The private refineries aren’t making money because of controlled fuel prices and high crude costs, so they have to reduce production,” Qiu Xiaofeng , an analyst at Beijing-based Galaxy Securities Co., said by telephone. “The state refiners have to step in to fill the output loss.” Private refineries produce more than 10 percent of China’s fuel, he said. China, the world’s biggest energy consumer, exported 403,442 metric tons of gasoline and 163,380 tons of diesel in February, according to customs data. Naphtha for Gasoline Sinopec Group plans to increase fuel production by 4 percent in April to 10.54 million metric tons, according to the newsletter. Output rose 6.2 percent to 31.55 million tons in the first quarter, it said. Crude processing volume climbed 7.4 percent to 54.72 million tons during the period. The parent of Hong Kong-listed China Petroleum & Chemical Corp. (600028) said it will reduce petrochemical output and use alternative raw materials including liquefied petroleum gas to divert more naphtha to the production of gasoline. “The wholesale market actually isn’t that tight now, suggesting that they could be doing this as advance preparation for peak demand during summer,” Jay Chi, chief analyst at Guangzhou Twinace Petroleum & Chemical Corp., the nation’s largest private fuel-oil importer, said by telephone from Guangzhou. “Growing Pressure” China has “a shortage of resources and growing pressure on fuel supply,” Sinopec Group said, without elaborating. The nation has had shortages in the past year, including a diesel shortfall in the fourth quarter when electricity constraints caused factories to use the fuel to generate their own power. China controls retail fuel tariffs to curb consumer price inflation, which was 5.4 percent last month, the highest since 2008. Refineries still make a loss of $2 a barrel after fuel- price increases on April 7 and Feb. 20, according to JPMorgan Chase & Co. Based on a mechanism introduced in December 2008, the government can adjust retail fuel prices when crude costs change more than 4 percent over 22 working days. “Shortages were worse when the government didn’t adjust fuel prices based on the new mechanism,” Deng Yusong, a director at the market economy research department of the State Council Research Center, said at a conference in Shanghai today. “If the fuel pricing mechanism isn’t strictly implemented, then we can’t exclude the possibility of shortages again.” Crude rose above $111 in New York for the first time in 30 months on April 8 as fighting in Libya and unrest in the Middle East spurred supply concerns. Crude was at $106.32 a barrel in electronic trading at 4:08 p.m. Singapore time. China Petroleum, or Sinopec, fell 0.6 percent to HK$7.88 at the 4:00 p.m. close of trading in Hong Kong while the benchmark Hang Seng index slid 1.3 percent. Rival PetroChina Co., the unit of China’s second-biggest refiner, fell 1.6 percent. To contact the reporter on this story: Baizhen Chua in Beijing at bchua14@bloomberg.net To contact the editor responsible for this story: Clyde Russell at crussell7@bloomberg.net

TPG Capital to Invest Up to $150 Million for 21% of China’s Comtec Solar

http://www.bloomberg.com/news/2011-04-19/tpg-capital-to-invest-up-to-150-million-for-21-of-china-s-comtec-solar.html

TPG Capital, the U.S. private- equity firm that manages $48 billion, said it plans to invest as much as HK$1.17 billion ($150 million) for a 21 percent stake in Hong Kong-listed Comtec Solar Systems Group Ltd. (712) TPG will buy five-year convertible bonds and warrants in the Shanghai-based solar wafer maker for HK$780 million and may invest an additional HK$390 million if the warrants are fully exercised, according to a statement from the companies today. Comtec Solar marks TPG’s second acquisition of a China- focused energy company since October. China, the world’s largest power consumer, should double its solar targets for 2015 after the nuclear crisis in Japan , Li Junfeng, deputy director general of the Beijing-based Energy Research Institute at the National Development and Reform Commission, said last week. Fort Worth , Texas-based TPG agreed in October to buy HK$195 million preferred shares of Hong Kong Energy Holdings Ltd. (987) with an option to buy a further 260 million preferred shares. The U.S. fund also bought a stake in China International Capital Corp. in December with KKR & Co., and a stake in Wumart Stores Inc., Beijing’s biggest supermarket chain, in 2009. The unsecured, zero-interest convertible bonds can be converted at HK$3.90 a share in 2016, according to the statement. TPG will also receive 95 million warrants that give it the right to additional stock at HK$4.10. Comtec Solar shares fell 2.2 percent to HK$4.06 at 3:04 p.m. local time today. TPG will own 295 million Comtec shares if the bonds are fully converted and all warrants exercised, equivalent to 21 percent of the enlarged share capital, according to the statement. Comtec will use the proceeds from the convertible bond sale to expand production capacity, it said in the release. Comtec Solar plans to use the proceeds to boost wafer production to 1,400 megawatts this year from 1,000 megawatts as it previously targeted, Chief Executive John Zhang said in a press conference today. To contact the reporter on this story: Cathy Chan in Hong Kong at kchan14@bloomberg.net To contact the editor responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net

Azeri State Oil Fund Grew 13% to $25.8 Billion on April 1

http://www.bloomberg.com/news/2011-04-19/azeri-state-oil-fund-expanded-13-to-32-6-billion-as-of-april-1.html

Azerbaijan’s State Oil Fund, known as Sofaz, increased 13 percent in the first quarter as fuel prices rose. Assets rose to $25.8 billion as of April 1 from $22.8 billion at the start of the year, Sofaz said today in an e- mailed statement. Sales of oil and natural gas from the ACG and Shah Deniz projects in the Caspian Sea , led by BP Plc (BP/) , provided the bulk of the fund’s wealth, Shahmar Movsumov, the head of the fund, told reporters today in Baku, the capital. Sofaz said about 55.3 percent of its investment portfolio is in U.S. dollars, 39.7 percent is in euros, and almost 5.1 percent is in pounds, according to the statement. To contact the editor responsible for this story: Torrey Clark at tclark8@bloomberg.net

Vermont Ski-Town Population Slides on ‘Bad Times’

http://www.bloomberg.com/news/2011-04-19/vermont-ski-town-population-slides-on-bad-times-census-shows.html

Business leaders in Vermont ’s Deerfield Valley promote the area with the slogan “It’s More Vermont Here.” Trouble is, there are fewer Vermonters. Dover, the heart of the valley and home to one of the closest ski resorts to New York and Boston , lost a fifth of its population over the last decade. Battered by a collapse in the second-home market and a slow tourist economy, residents fled southern Vermont’s ski region from 2000 to 2010, census figures show. Three other resort towns

Seagate to Buy Samsung’s Hard-Disk Unit for $1.38 Billion, Build Alliance

http://www.bloomberg.com/news/2011-04-19/samsung-electronics-seagate-to-combine-computer-hard-disk-drive-business.html

Seagate Technology Plc (STX) agreed to buy Samsung Electronics Co.’s computer hard-disk drive business for $1.38 billion in cash and stock as shrinking sales accelerates consolidation in the industry. Seagate offered 45.2 million shares valued at $687.5 million and the remainder in cash, the companies said today in a joint statement. They also agreed to supply each other with electronic- storage devices as part of a strategic partnership. The deal will help the industry’s second-largest producer narrow the lead Western Digital Corp. (WDC) took last month when it agreed to buy Hitachi Ltd. (6501) ’s storage business, while giving Samsung funds to invest in new businesses such as health care. Mechanical drive makers have slashed prices to compete against faster and smaller flash-memory chips used in Apple Inc. (AAPL) ’s iPad and some laptop computers. “This can’t be bad for Samsung,” Han Seung Hoon, an analyst at Korea Investment & Securities in Seoul. “Samsung’s hard-disk business hasn’t really been making money, so with this deal, they can be more competitive.” After the transaction, Samsung will become the second- largest shareholder of Seagate with a 9.6 percent stake and will be entitled to nominate a director, the companies said. They said they expect to complete the deal by the end of the year. Biggest Deal Samsung rose 0.9 percent to close at 875,000 won in Seoul trading before the announcement. Dublin-based Seagate fell 13 cents to $17.71 on the Nasdaq Stock Market at 9:41 a.m. New York time. It had added 19 percent this year before today. The deal is subject to a review by the U.S. and international regulators, Samsung said in a separate statement. The sale is the biggest ever by the Suwon, South Korea-based company, according to data compiled by Bloomberg. Samsung also agreed to supply Seagate with NAND flash memory to be used in storage devices made by Seagate, according to the statement. Seagate will supply disk drives to Samsung for personal computers and notebooks. Samsung began making hard-disk drives in 1989 and the business is part of the company’s semiconductor unit. After selling the division, Samsung will focus on its chip operations, while Seagate will be able to secure “a strategic status” in the global market, Samsung said. Tablet Computers Hard-disk drive shipments will probably drop about 4 percent this quarter from the fourth quarter amid competition from smaller and faster storage products, according to IHS ISuppli. Samsung and Toshiba Corp. (6502) are the biggest makers of so- called flash memory used to store data in some laptops and tablets such as the iPad and Samsung’s Galaxy Tab. Western Digital accounted for 31 percent of global hard drive shipments in the fourth quarter, followed by Seagate’s 30 percent, Hitachi’s 18 percent, Toshiba’s 11 percent and Samsung’s 10 percent, according to IHS ISuppli estimates last month. Since then, Western Digital agreed to buy Hitachi’s storage business for $4.3 billion. Apple and other electronics makers will generate $49 billion in sales of tablet computers by 2015, a sign of booming demand for devices that bridge the gap between smartphones and laptops, according to research firm Strategy Analytics. Last year, Western Digital tried to buy Seagate, two people familiar with the matter said in December. The offer was refused on concern the deal would have faced antitrust obstacles, the people said. Seagate also spurned an offer from TPG Capital. Morgan Stanley served as financial adviser to Seagate while Allen & Co. advised Samsung, according to the statement. To contact the reporter on this story: Jun Yang in Seoul at jyang180@bloomberg.net To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net .

Pick n Pay’s Credit Rating Outlook Cut by Fitch After Annual Profit Slumps

http://www.bloomberg.com/news/2011-04-19/pick-n-pay-s-credit-rating-outlook-cut-by-fitch-after-annual-profit-slumps.html

Fitch Ratings cut its outlook on the credit rating for Pick n Pay Stores Ltd. (PIK) , South Africa ’s second-largest grocer, to negative from stable following a drop in annual earnings. The national long-term rating was affirmed at A+, Fitch said in a statement today. To contact the editor responsible for this story: Nasreen Seria at nseria@bloomberg.net

Taiwan to Raise Interest Rates on Reserves Starting April 20

http://www.bloomberg.com/news/2011-04-19/taiwan-to-raise-interest-rates-on-reserves-starting-april-20-1-.html

Taiwan ’s central bank said it will increase the interest rates it pays banks for money held in reserve starting April 20 to reflect higher funding costs. The interest the central bank pays on lenders’ reserves that come from demand deposits will rise to 0.233 percent from 0.203 percent, while the rate for funds from time deposits will climb to 1.043 percent from 0.986 percent, the Central Bank of the Republic of China (Taiwan) said in an e-mailed statement. The interest is paid on 55 percent of the lenders’ reserves, the central bank said in today’s statement. The central bank raised its benchmark interest rate by 0.125 percentage point to 1.75 percent in March, adding to increases of the same amount each in June, September and December from a record low. The monetary authority today reiterated that it won’t pay lenders interest on reserves held for Taiwan-dollar deposits from foreigners. The measure came into effect on Jan. 1. The central bank on Dec. 30 increased the reserve requirement on some local-currency deposits by foreigners to as much as 90 percent, also effective Jan. 1. To contact the reporter on this story: Janet Ong at jong3@bloomberg.net To contact the editor responsible for this story: Stephanie Phang at sphang@bloomberg.net

BHP’s Coking Coal Output Curbed by Rain in Third Quarter

http://www.bloomberg.com/news/2011-04-19/bhp-s-iron-ore-coal-output-curbed-by-rain-in-third-quarter-1-.html

BHP Billiton Ltd. (BHP) , the world’s largest mining company, said third-quarter output of coking coal declined 14 percent as heavy rain flooded mines in Australia and disrupted deliveries. Production of coking coal, used to make steel, was 6.67 million tons in the three months ended March 31, Melbourne-based BHP said today in a statement. That compares with Credit Suisse Group AG’s estimate of 8 million tons. Iron ore output dropped 1 percent to 33.2 million tons. Heavy rain in the eastern state of Queensland and cyclones in Western Australia disrupted mining and BHP said today coal sales may be affected for the rest of the calendar year. Wesfarmers Ltd., which also mines coal in Queensland, today reported a 42 percent decline in coking coal output in the period because of flooding. “We had assumed BHP’s metallurgical coal production was back at full production by the end of the September 2011 quarter, so this is a three month delay to our forecasts,” UBS AG said in a report after the announcement. UBS had estimated BHP’s output of coking coal at 6.5 million in the quarter. BHP rose 1.2 percent to A$47.23 at the 4:10 p.m. Sydney time close. The benchmark index gained 1.4 percent. Force Majeure Coking coal output dropped 18 percent from a year earlier, BHP said. Coking coal was BHP’s largest income earner after iron ore , base metals and petroleum last year, according to data compiled by Bloomberg. “Force majeure remains in place for the majority of our Bowen Basin products with production, sales and unit costs likely to be impacted, to some extent, for the remainder of the 2011 calendar year,” BHP said. Force majeure is a legal clause that allows a company to miss deliveries due to circumstances beyond its control. Wesfarmers said today coal output declined 38 percent to 1.49 million tons, led by a 42 percent drop in coking coal because of the flooding in Queensland. Two months of torrential rains and the worst floods in Queensland since 1974 in January killed 36 people, shut mines and cut rail lines. The state produces 80 percent of the coking coal exported from Australia , the world’s largest shipper. Profit, Spending Iron ore production rose 7 percent from the same period last year, according to the statement. Output for the nine months ended March 31 was a record, BHP said. Iron ore sales accounted for 21 percent of the company’s total last year. Almost all of BHP’s iron ore is mined in Western Australia, while a smaller quantity is produced through a joint venture in Brazil with Vale SA, the world’s largest producer. BHP, which reported a record first-half profit of $10.5 billion in February, plans to spend $80 billion by the end of the 2015 financial year to expand and develop its mines and oil fields, it said Feb. 16. It approved $7.4 billion in spending on the Pilbara operations last month to boost capacity to 220 million tons a year by 2014. It’s considering further expansions to increase capacity to more than 300 million tons by 2020. The company may spend $25 billion on the expansions, Citigroup Inc. said in a report in February. “We’re going to see further increases in volume coming through there and that should support iron ore growth,” Chris Weston , an institutional dealer at IG Markets in Melbourne, said by phone today. BHP’s energy coal output rose 7 percent to 17.5 million tons in the third quarter from a year earlier. Copper production gained 19 percent to 273,600 tons. Petroleum To Decline Petroleum, the company’s third-biggest earner last year, fell 4 percent in the quarter to 35.8 million barrels of oil equivalent. BHP is Australia’s largest oil and natural-gas producer. Output may fall next year because of drilling delays in the U.S. Gulf of Mexico following the disaster at BP Plc’s Macondo well, it said today. BHP in February agreed to buy Chesapeake’s Arkansas shale gas assets for $4.75 billion, making its first move into U.S. shale gas. The transaction, completed on March 31, expands BHP’s oil and gas reserves by 45 percent. BHP may report annual profit of $22.1 billion this financial year, according to the median estimate of 16 analysts compiled by Bloomberg. That would be a 74 percent increase from last year as metal prices gained 42 percent since June 30, according to the London Metals Exchange Index. Iron ore prices have gained 29 percent in the same period. To contact the reporter on this story: Soraya Permatasari in Melbourne at soraya@bloomberg.net To contact the editor responsible for this story: Andrew Hobbs at ahobbs4@bloomberg.net

Toyota May Miss 2011 China Goal on Lack of Parts From Japan

http://www.bloomberg.com/news/2011-04-19/toyota-says-it-may-miss-2011-china-target-of-over-900-000-units.html

Toyota Motor Corp. (7203) , the automaker most affected by Japan’s record earthquake last month, may not be able to meet its China sales target of over 900,000 vehicles this year due to the impact of the disaster. Toyota, the world’s biggest automaker, may have problems with parts stemming from the March 11 earthquake, and industrywide supply may fall short of demand in China, Masayoshi Hori, executive coordinator for the automaker’s China unit, said at the Shanghai auto show today. The carmaker’s China operation is monitoring the component situation, he said. The company based in Aichi, Japan, lost production of 260,000 units in Japan from March 14 to April 8. It has resumed operations at all of its domestic plants, with output at 50 percent of normal levels. Manufacturing has been reduced at overseas plants, including those in North America , Europe and Australia. “Toyota is the most vulnerable, as it is more exposed to suppliers in Japan,” said Ashvin Chotai , managing director of Intelligence Asia Automotive. About 150 components are currently in short supply, compared with 500 two weeks ago, spokesman Masami Doi said today. As a result, factories in China are not operating on weekends, holidays or on overtime, Hori said. Double China Sales Separately, Hori said the automaker plans to double China sales in 2015 from the 846,000 vehicles it sold in 2010. Toyota fell 3.1 percent to 3,125 yen at the 3 p.m. close of trading in Tokyo. The stock has declined 14 percent since March 10, the day before the temblor. The maker of Prius hybrid cars is studying whether to produce hybrid parts such as motors, batteries and inverters in China, Hori said. Toyota will test electric cars in the country this year, he said. The Toyota City based company expects the Chinese auto industry to grow by 10 percent to 15 percent this year, Managing Officer Shinji Kitada said today in Shanghai. Chinese demand is strongest for compact cars and sports utility vehicles, he said, adding that Toyota is “able to secure solid profitability.” To contact the reporter on this story: Makiko Kitamura in Tokyo at mkitamura1@bloomberg.net. To contact the editor responsible for this story: Kae Inoue at kinoue@bloomberg.net

Mauritius’s Trade Deficit Widens 18% in February on Fuel

http://www.bloomberg.com/news/2011-04-19/mauritius-s-trade-deficit-widens-18-in-february-on-fuel-1-.html

Mauritius’s trade deficit widened 18 percent to 5.69 billion rupees ($205 million) in February from a year earlier as fuel imports rose, the Central Statistics Office said. The trade gap increased from 4.81 billion rupees in February 2010 and was at 4.91 billion rupees in January this year, the Port Louis-based agency said in a statement on its website today. Imports to the Indian Ocean island nation jumped 19 percent to 11 billion rupees on a 33 percent increase in the cost of fuel shipments to 2.4 billion rupees, the agency said. To contact the reporter on this story: Kamlesh Bhuckory in Port Louis at kbhuckory@bloomberg.net To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

Comcast Extends U.S. NHL Rights; 10-Year Deal Said to Reach $2 Billion

http://www.bloomberg.com/news/2011-04-19/comcast-said-to-agree-to-10-year-2-billion-television-contract-with-nhl.html

Comcast Corp. (CMCSA) ’s NBC and Versus networks said they had retained U.S. broadcast rights for National Hockey League games in a 10-year contract that people familiar with the agreement said was worth $2 billion. NHL Commissioner Gary Bettman, joined by NBC Sports Group Chairman Dick Ebersol on a conference call with reporters, said the accord will expire after the 2020-21. Bettman and Ebersol declined to disclose specifics of the rights fee. The $2 billion price tag was confirmed earlier today by two people who were granted anonymity because the deal hadn’t been officially announced. “We are looking at the most significant media deal that this league has ever been able to participate in,” Bettman said. NBC and Versus had the right to match any bid as part of their previous agreement with the NHL. NHL television ratings in the U.S. have increased 84 percent over the last four years, and the league is in line to set a revenue record this season, topping $2.9 billion, the NHL said in a news release announcing today’s agreement. The agreement calls for the networks to televise 100 regular-season games each season and air a national NBC broadcast on the day after the U.S. Thanksgiving holiday in late November. It also includes national distribution of all NHL playoff games and exclusive coverage starting with the conference semifinal round. Other Bidders Time Warner Inc. (TWX) ’s Turner Sports said in a statement yesterday that it was pulling out of the NHL rights bidding. Comcast, which owns Versus, in January completed the purchase of a majority stake in NBCUniversal from General Electric Co., which included the NBC network. Comcast and NBC have aired NHL games as separate companies since the league returned from a work stoppage that led to the cancellation of the 2004-05 season. The original Comcast deal was for $207.5 million over three years, while NBC had a revenue-sharing agreement with the NHL and hasn’t paid a rights fee for hockey in six seasons. ESPN, which previously had the U.S. cable rights for the NHL, declined to pick up its $60 million option for the 2005-06 season, saying at the time that the sport wasn’t worth half that price. NBC ‘Minority’ “Our wonderful, for us, run of not paying anything for a number of years is over with this deal,” Ebersol said, adding that a “substantial” minority portion of the new fees come from the national NBC broadcasts. Bettman said he didn’t have any regrets about the previous deals with NBC. “They have been extraordinary partners, they stood by us through a difficult time and they are deserving of tremendous credit for the positioning that we find ourselves in today as a sport and media property,” Bettman said. Versus will be renamed within 90 days to some way utilize the NBC name, Ebersol said. “You are the final impetus,” Ebersol said, speaking to Bettman about the name change. “I hope that’s as meaningful to you, your teams, your players, that based on this incredible deal we are going to rename ourself.” To contact the reporter on this story: Mason Levinson in New York at mlevinson@bloomberg.net ; Michele Steele in New York at msteele10@bloomberg.net. To contact the editor responsible for this story: Michael Sillup at msillup@bloomberg.net .

CANADA DAYBOOK: Ontario Committee Reports on TMX Group Sale

http://www.bloomberg.com/news/2011-04-19/canada-daybook-ontario-committee-reports-on-tmx-group-sale.html

The Ontario legislative committee reviewing the proposed sale of TMX Group Inc. to the London Stock Exchange Group Plc releases its recommendation today. WHAT TO WATCH: *Conservative Prime Minister Stephen Harper and Liberal Leader Michael Ignatieff campaign for the May 2 federal election. Harper will be in Thunder Bay, Ontario and Val d’Or, Quebec while Ignatieff goes to Winnipeg, Manitoba and Brampton, Ontario. ECONOMY: *Statistics Canada is scheduled to release reports on inflation at 7 a.m. and on wholesale sales and the index of leading economic indicators in Ottawa at 8:30 a.m. *The province of Newfoundland presents its budget at about 11:30 New York time in St. John’s. EVENTS: * Research In Motion Ltd.’s (RIM) BlackBerry PlayBook goes on sale today at 20,000 stores across Canada and the U.S. at retailers including Best Buy Co., Staples Inc., RadioShack Corp. and Office Depot Inc. *An Ontario select committee is expected to submit its report to the provincial legislature on the C$3.2 billion ($3.3 billion) takeover of TMX Group Inc. (X) by London Stock Exchange Group Plc. * Teck Resources Ltd. (TCK/B) , Canada’s largest base-metals and coal producer, is scheduled to hold a conference call to discuss first-quarter financial results at 8 a.m. in Vancouver. *Largo Resources Ltd., which is developing base-metals projects in Canada and Brazil, holds a business-update conference call at 11 a.m. in Toronto. *Melcor Development Ltd., which develops real estate in western Canada, is scheduled to hold its annual meeting at 11 a.m. in Edmonton, Alberta. MARKETS: *The S&P/TSX (SPTSX) index fell 0.7 percent to a one-month low of 13,702.33. *Yields on two-year Government of Canada bonds fell 6 basis points to 1.69 percent at 4 p.m. in Toronto. *The Canadian dollar fell to 96.42 cents per U.S. dollar yesterday. One Canadian dollar bought $1.0371. To contact the editor responsible for this story: David Scanlan at dscanlan@bloomberg.net .

Intel Forecasts Second-Quarter Sales That May Top Estimates; Stock Surges

http://www.bloomberg.com/news/2011-04-19/intel-forecasts-second-quarter-sales-that-may-top-estimates-shares-climb.html

Intel Corp. (INTC) , the world’s biggest chipmaker, forecast second-quarter sales that may top analysts’ estimates, evidence of booming demand for machines that deliver computing over the Internet. Revenue will be $12.8 billion, plus or minus $500 million, Intel said today in a statement. That compares with $11.9 billion, the average of analysts’ projections compiled by Bloomberg. Shares surged as much as 6.7 percent in late trading. The company is benefiting as mobile devices including Apple Inc. (AAPL) ’s iPad drive demand for online services provided by Intel- powered servers. Even as PC sales came under pressure last quarter, Intel’s 80 percent share of the microprocessor market boosts sales when companies upgrade their server and PC fleets. “This is the strength of a new product cycle,” Hans Mosesmann, an analyst at Raymond James & Associates Inc., said in an interview. “There’s a refresh cycle occurring in the servers space, and they are probably gaining share.” Intel, based in Santa Clara , California , rose as high as $21.19 in extended trading after the report. The shares had gained 24 cents to $19.86 at 4 p.m. New York time on the Nasdaq Stock Market. The stock has lost 5.6 percent this year. First-quarter net income rose 29 percent to $3.16 billion, or 56 cents a share, from $2.44 billion, or 43 cents, a year earlier. Analysts on average had estimated profit of 46 cents. Sales increased 25 percent to $12.8 billion, compared with an average prediction of $11.6 billion. Cloud Demand Customers are snapping up the machines needed to deliver computing, software and storage over the Internet -- via the so- called cloud. Sales of servers used to deliver cloud computing may rise to $6.4 billion in 2014, representing 1.3 million units, from $3.8 billion, or 600,000 units, last year, according to researcher IDC. “The server business exceeded our expectations as strong demand from the data-center segment continued,” Intel Chief Financial Officer Stacy Smith said in a statement posted on Intel’s website. Gross margin, the only indicator of profitability that Intel forecasts, will be 61 percent, plus or minus a couple percentage points, this quarter, the company said. Gross margin

Grupo Mexico First-Quarter Profit Rises on Copper Prices

http://www.bloomberg.com/news/2011-04-19/grupo-mexico-first-quarter-profit-rises-on-copper-prices-1-.html

Grupo Mexico SAB, the country’s largest mining company, said first-quarter profit rose 47 percent on increased copper prices and production. Net income gained to $531.7 million, from $361.9 million in the year-earlier period, the Mexico City-based company said today in a statement to the Stock Exchange. Sales climbed 26 percent to $2.5 billion. No per-share figure was given. Copper futures averaged $4.377 a pound in the quarter, 33 percent higher than in the year-earlier period. Output rose 5.2 percent after the company resumed production at its Buenavista and Cananea copper mines. Still, the mining group, controlled by billionaire German Larrea, is grappling with higher electricity and fuel costs, and the appreciation of the Mexican peso. Grupo Mexico fell 54 centavos, or 1.4 percent, to 37.4 pesos as of 11:01 a.m. on the Mexico Stock Exchange. The stock has dropped 11 percent in the past five trading days. To contact the reporter on this story: Carlos Manuel Rodriguez in Mexico City at carlosmr@bloomberg.net To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

Barcelona Appeals Proposed UEFA Ban for Midfielder Iniesta, Club Says

http://www.bloomberg.com/news/2011-04-19/barcelona-appeals-proposed-uefa-ban-for-midfielder-iniesta-club-says.html

Barcelona has appealed a proposed suspension for Andres Iniesta after the midfielder allegedly got a yellow card on purpose during a recent Champions League match against Shakhtar Donetsk. UEFA’s disciplinary committee will rule on the matter tomorrow, Barcelona said on its website. A ban would keep Iniesta out of next week’s first semifinal game against archrival Real Madrid. Iniesta was booked in the first half of the 5-1 opening quarterfinal game on April 6, earning him a mandatory one-game ban for the return match, which Barcelona won 1-0. The midfielder’s disciplinary slate was then wiped clean for the next game. “The proposed sanction comes as a result of a report from UEFA match officials at the game, who have alleged that the yellow card was deliberately incurred so that the player would be suspended for the return leg,” Barcelona said on the website. “FC Barcelona believe that the arguments outlined in their appeal, based on the good faith of the player and the disproportionate nature of the proposed sanction, will be sufficient to rebut these allegations.” Real Madrid hosts the first semifinal game April 27, with the return match six days later at the Nou Camp Stadium. The winner will meet Manchester United or Schalke in the final May 28 at London’s Wembley Stadium. To contact the reporter on this story: Bob Bensch in London at bbensch@bloomberg.net. To contact the editor responsible for this story: Christopher Elser at celser@bloomberg.net .

Hartford Financial May Need to Bolster Japan Unit, S&P Says

http://www.bloomberg.com/news/2011-04-19/hartford-financial-may-need-to-bolster-japan-business-s-p-says.html

Hartford Financial Services Group Inc. (HIG) , the insurer that repaid a $3.4 billion bailout, may have to bolster its Japan unit as last month’s earthquake cuts the value of securities tied to client guarantees. “The company may need to increase the capital it holds to support its Japanese annuity business, but we believe it maintains appropriate capital redundancy to withstand this,” Standard & Poor’s said today in a statement on Hartford, based in the Connecticut city of the same name. S&P raised its outlook on Hartford’s BBB credit rating to “stable” from “negative” last month. Hartford’s obligations in Japan stem from guarantees made to clients that bought variable annuities, the equity-based retirement products. In 2009, the company halted new sales in Japan while retaining liabilities tied to annuities sold before the financial crisis. When Japanese stocks fall, those liabilities may increase. The Nikkei 225 (NKY) Index has dropped 9.5 percent since March 10, the day before the earthquake. To contact the reporter on this story: Andrew Frye in New York at afrye@bloomberg.net To contact the editor responsible for this story: Dan Kraut at dkraut2@bloomberg.net

Bowe Bell & Howell Seeks Bankruptcy, Sells Itself to Versa to Pay Debts

http://www.bloomberg.com/news/2011-04-19/bowe-bell-howell-seeks-bankruptcy-sells-itself-to-versa-to-pay-debts.html

Bowe Bell & Howell, a maker of high-speed mail-sorting equipment and software developer, sought bankruptcy court protection and agreed to sell itself to creditor Versa Capital Management Inc. to pay off debt. The company, based in Wheeling, Illinois, and related to the Bell & Howell movie-projector maker, listed as much as $500 million each of debt and assets in yesterday’s Chapter 11 filing in U.S. Bankruptcy Court in Wilmington, Delaware. Versa holds a majority of the debt, which will be resolved through the sale, the company said in a statement distributed by Business Wire. A hearing is tentatively scheduled for May 4 to set auction procedures. Its BBH Canada unit will ask an Ontario Superior Court judge to recognize the U.S. bankruptcy proceedings, the company said. That would prevent creditors in Canada from suing to recoup their debts. “While the past few years have been challenging for most businesses, they have been especially so for BBH due to a variety of legacy factors,” Chief Executive Officer George Marton said in the statement. “We have also received commitments from Versa to provide new financing.” Among the company’s largest unsecured creditors listed in court papers are Boewe Systec GmbH of Augsburg, Germany , owed $12.7 million; and the company’s pension plan, owed $10.9 million. The closely held firm, also known as Boewe Bell & Howell, employs about 1,600 people. Bell & Howell started making film projectors in the early 20th century in Chicago and later sold movie cameras. Bowe Systec bought a 50 percent stake in Bell & Howell in 2002 -- and now owns 100 percent, according to court papers. The case is In re Bowe Bell & Howell Holdings Inc., 11- 11186. U.S. Bankruptcy Court , District of Delaware (Wilmington). To contact the reporters on this story: Joe Schneider in Sydney at jschneider5@bloomberg.net ; Phil Milford in Wilmington, Delaware pmilford@bloomberg.net. To contact the editor responsible for this story: Douglas Wong at dwong19@bloomberg.net ; John Pickering at jpickering@bloomberg.net

China’s Mobile Ads Will Double to $1.16 Billion in 2014, EMarketer Says

http://www.bloomberg.com/news/2011-04-19/china-s-mobile-ads-will-top-1-billion-in-2014-emarketer-says.html

Advertising on mobile devices in China will more than double to $1.16 billion in the next three years, growing faster than the U.S. market, according to a report by EMarketer Inc. Mobile advertising in China will grow 158 percent by 2014, EMarketer predicted in a report to be published today. In the U.S., mobile ad sales will grow 131 percent to $2.55 billion over the same period, the report said. Advertisers are boosting spending on text and graphic display ads for handheld devices in China as portions of the world’s largest Web market increasingly migrate to mobile phones. The country will add almost 200 million mobile Internet users over the next three years, bringing the total to 568 million in 2014, according to EMarketer. “Because mobile devices are often the primary way that consumers access digital content” in China and other emerging markets, advertisers enjoy a “heightened appeal relative to a more mature market, where you have higher PC penetration rates,” said Noah Elkin, principal analyst at EMarketer in New York. Emerging markets for mobile advertising such as India, Brazil and Russia are growing at even faster rates than China. India’s mobile ad spending will total $190 million in 2014, up more than threefold from this year. Brazil’s mobile ads will grow almost fivefold to $117 million in the same period. Mobile advertising in Russia will more than triple to $72 million in 2014. In the U.S., competition for mobile ad dollars has drawn large technology companies to make acquisitions in the industry. Google Inc. (GOOG) purchased mobile ad provider AdMob last year for about $700 million. The same year, Apple Inc. (AAPL) acquired Quattro Wireless, another startup selling ads placed on mobile devices. To contact the reporter on this story: Douglas MacMillan in San Francisco at Dmacmillan3@bloomberg.net. To contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net .

U.S. Bancorp Profit Rises 56% on Lower Credit-Loss Provision

http://www.bloomberg.com/news/2011-04-19/u-s-bancorp-profit-rises-56-to-1-05-billion-on-lower-credit-provisions.html

U.S. Bancorp, Minnesota ’s largest bank, reported first-quarter profit rose 56 percent to the highest in three years on lower credit costs. Net income increased to $1.05 billion, or 52 cents a share, from $669 million, or 34 cents, in the same period a year earlier, the Minneapolis-based bank said in a statement today. The average estimate of 27 analysts surveyed by Bloomberg was for 49 cents. Credit-loss provisions declined 42 percent to $755 million from $1.31 billion. U.S. Bancorp, run by Chairman and Chief Executive Officer Richard Davis, last month boosted its quarterly dividend 150 percent to 12.5 cents a share after the Federal Reserve didn’t object to its proposed capital plan. The company also approved an authorization to repurchase as many as 50 million common shares. “The economy is slowly recovering,” Davis said in the statement. “We can see it in our customers’ actions -- from growth in small business lending to higher payment processing transaction volumes to improving credit metrics -- and, importantly, in our customers’ outlook.” U.S. Bancorp fell 31 cents, or 1.2 percent, to $25.25 at 4:15 p.m. in New York Stock Exchange composite trading. The shares have declined 6.4 percent this year. The bank’s average total loan growth of 0.7 percent in the first quarter from the fourth quarter was “wholly insufficient” and fell short of his expectation of 1.5 percent to 2 percent, Davis said in a conference call after earnings were announced. Credit Not Used “We have people we continue to bank that are ready to use the line but demonstrating when they have the availability of credit they are not using it,” he said. The results included a $46 million gain related to the January acquisition of First Community Bank of New Mexico , a Federal Deposit Insurance Corp.-assisted transaction, U.S. Bancorp said in the statement. “We will certainly look at opportunities that are presented to us, but right now nothing is being presented, so there aren’t a lot of opportunities in the market place,” Chief Financial Officer Andrew Cecere said in an interview today. Net charge-offs fell 29 percent to $805 million in the first quarter from $1.14 billion a year earlier. The decrease was attributable to improvement in U.S. Bancorp’s commercial real estate, credit-card and other retail portfolios, according to the statement. Net interest income increased 4.3 percent to $2.51 billion from $2.4 billion in the first quarter last year, the bank said. Net interest margin, the difference between what a bank pays on deposits and charges for loans, narrowed to 3.7 percent from 3.9 percent last year. To contact the reporter on this story: Laura Marcinek in New York at lmarcinek3@bloomberg.net. To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net .

Mitsui’s Moex, Anadarko Sue BP Over Gulf Blowout, Oil Spill

http://www.bloomberg.com/news/2011-04-19/bp-partner-moex-claims-breach-of-contract-over-gulf-well.html

BP Plc (BP/) was sued by Mitsui & Co.’s Moex Offshore LLC unit and Anadarko Petroleum Corp. (APC) over economic losses from the blown-out Macondo well and the Gulf of Mexico oil spill that followed. Moex and Anadarko, both minority partners in the well, claim BP broke its partnership agreement and have asked a federal judge in New Orleans to declare they aren’t responsible for damages and cleanup costs created by the worst offshore oil spill in U.S. history. The companies said BP was responsible for the blowout and the spill. “BP’s conduct was the proximate cause of foreseeable damage suffered by Moex Offshore, including claims made against it for liability for death, personal injury, cleanup costs, economic loss, loss of investment, lost profits and any damages or fines assessed in pending or future proceedings involving the spill,” Moex said in a court filing yesterday. The Macondo well blew up one year ago today, setting off the spill and leading to hundreds of lawsuits against BP and its partners and contractors. Moex and Anadarko, saying they had no fault in the blow-out and spill, also accused Transocean Ltd. (RIG) , the owner of the rig that drilled the well, of gross negligence. Switzerland-based Transocean was responsible along with BP for the damages, according to Moex and Anadarko. ‘No Evidence’ BP, based in London , has said it expects its minority partners in the damaged well to pay their share of billions of dollars in cleanup costs, oil-spill damages and pollution fines. Moex, which had a 10 percent stake in the well, and The Woodlands, Texas-based Anadarko, with a 25 percent stake, deny having any decision-making role or prior knowledge of the way BP operated the drilling project. “No evidence exists to support a claim of gross negligence against Transocean,” Brian Kennedy, a spokesman for the drilling company, said in an e-mail. “Moex’s filing contains a number of specific allegations against BP that are not supported by fact or by law,” Daren Beaudo , a BP spokesman, said in an e-mail yesterday before Anadarko made its filing. “BP will respond to the complaint in a timely manner.” ‘Lacking in Merit’ Anadarko’s filing is “an attempt to avoid honoring its obligations under the Macondo operating agreement,” Scott Dean , another BP spokesman, said in an e-mail today. “This lawsuit is completely lacking in merit, and BP firmly believes that it did not act in a grossly negligent manner.” BP plans to file a motion sending Anadarko’s claims to arbitration, Dean said. “From the outset, BP, alone, has committed to paying all legitimate claims and fulfilling its obligations to the Gulf communities” under the Oil Pollution Act, he said. “BP has already paid out more than $5 billion.” Moex said in its filing yesterday that it “suffered economic losses as a result of BP’s negligence, including the loss to the reservoir, the loss of its investments, lost profits and defense costs, including attorneys’ fees.” Anadarko is also seeking damages for the loss of the oil in the exploration area, loss of its investments and lost profit, contending BP “breached its duties to Anadarko by committing acts of gross negligence and willful misconduct in reckless disregard of the rights and safety of others,” according to its claim filed yesterday. BP “recklessly made multiple decisions” before the explosion to save time and money, Anadarko said. The case is part of In re Oil Spill by the Oil Rig Deepwater Horizon in the Gulf of Mexico on April 20, 2010, MDL- 2179, U.S. District Court, Eastern District of Louisiana (New Orleans). To contact the reporter on this story: Margaret Cronin Fisk in Southfield, Michigan, at mcfisk@bloomberg.net ; Laurel Brubaker Calkins in Houston at laurel@calkins.us.com. To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

Egypt Banking System Outlook Revised to Negative at Moody’s

http://www.bloomberg.com/news/2011-04-19/egypt-banking-system-outlook-revised-to-negative-at-moody-s-1-.html

Moody’s Investors Service revised the outlook for the Egyptian banking service in the next 12 to 18 months to “negative” from “stable.” The change reflects the “elevated political uncertainty” in Egypt following an uprising that toppled President Hosni Mubarak in February and the weakened macroeconomic outlook, Nondas Nicolaides and Yves Lemay, wrote in a statement today. “Even though Egypt’s ruling military regime has committed to holding democratic elections in order to meet people’s demands, Moody’s believes that there are still elevated risks involved in an orderly transition toward democratic rule,” Limassol, Cyprus-based Nicolaides was cited as saying. Moody’s expects the country’s economy to slow, growing around 2 percent in the next 12 to 18 months due to a decline in tourism, and direct foreign investment. To contact the reporter responsible for this story: Mahmoud Kassem at mkassem1@bloomberg.net

Geithner Sees Progress Toward Accord to Reduce Record U.S. Budget Deficits

http://www.bloomberg.com/news/2011-04-19/geithner-sees-progress-toward-accord-to-reduce-record-u-s-budget-deficits.html

Treasury Secretary Timothy F. Geithner said he’s confident U.S. political leaders will bridge their differences and move toward a long-term plan to narrow record budget deficits and reduce the debt. “We have an opportunity now over the next two months to make some real progress,” Geithner said in an interview on Bloomberg Television today. “What we agree on is putting in place strong targets for savings, deficit reduction over a specific time frame with enforceable limits,” he said. Geithner also said he “absolutely” didn’t have to reassure overseas buyers of U.S. debt after Standard & Poor’s lowered the outlook on the nation’s AAA rating to “negative” yesterday. President Barack Obama today begins a tour promoting his proposal to cut long-term budget deficits as Democrats and Republicans use the S&P decision to bolster their competing arguments on the best way to reduce gaps. The yield on the benchmark 10-year Treasury note fell one basis point, or 0.01 percentage point, to 3.37 percent at 5 p.m. in New York today. The yield is down from 3.80 percent a year ago and below the average of 5.21 percent over the last two decades, even with the U.S. projected to post a deficit in excess of $1 trillion for a third consecutive year. “There’s a lot of confidence in the capacity of this economy to grow, to make sure that we can meet our commitments or obligations,” Geithner said. “You can see that in the price at which we borrow every day.” In a separate interview with Fox Business Network today, he said the U.S. will “absolutely” keep its AAA credit rating. Top Rating S&P said the government risks losing its top rating unless policy makers agree on a plan by 2013 to reduce deficits and the national debt. The company maintained the rating on U.S. long- term debt while lowering its outlook for the first time. Geithner also said today that so-called entitlement programs “have to be” part of the discussion on deficit reduction. “The only way to do this in a way that’s responsible is to do a balanced, comprehensive package,” he said. The administration and Congress need to work together in coming months to agree on a framework for cutting deficits, he said. Turning to Europe , Geithner said leaders are following through on pledges to help Greece and Ireland weather the sovereign-debt crisis. “If you look at what the governments of Greece, of Ireland and many others are doing, they are doing incredibly difficult reforms to help make sure they bring their deficits down, their economies are restructured, financial systems stronger,” he said. European leaders “have the capacity to do this” and “have said they will do whatever is necessary to make sure they can help those countries manage those challenges, get through this problem,” Geithner said. “They’re making some progress.” To contact the reporters on this story: Ian Katz in Washington at ikatz2@bloomberg.net ; Peter Cook in Washington at pcook6@bloomberg.net To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net ;

British Olympic Bodies Settle 2012 Games Dispute Over Funding Distribution

http://www.bloomberg.com/news/2011-04-19/british-olympic-bodies-settle-2012-games-dispute-over-funding-distribution.html

The British Olympic Association and the organizers of the 2012 London Games settled a dispute over funding of the national teams that was headed for arbitration. The BOA and the local organizing committee ended their disagreement after several days of negotiations, they said today in an e-mailed statement. Under the terms, the local organizing committee, once it has a “sufficient surplus,” will share funds with the BOA and the British Paralympic Association after the event, while distributing 60 percent of a surplus for the benefit of sport in the U.K., 20 percent to the International Olympic Committee and 20 percent to the BOA, the statement said. To contact the editor responsible for this story: Chris Elser at celser@bloomberg.net

England Cricket Offers Flower New Deal to Fend Off India, Telegraph Says

http://www.bloomberg.com/news/2011-04-19/england-cricket-offers-flower-new-deal-to-fend-off-india-telegraph-says.html

England cricket coach Andy Flower has been offered a new three-year contract in an attempt to stave off any moves from India to hire him, the Daily Telegraph reported. India has Flower on its shortlist to replace coach Gary Kirsten, who left after the April 2 World Cup final win over Sri Lanka, the newspaper said. Flower is scheduled to meet Hugh Morris, the managing director of the England team, at the end of this month to discuss his future and the direction of the England setup, the newspaper added. Flower, 42, guided England to two Ashes series wins and the 2010 ICC World Twenty20 title since being appointed in April 2009. The team is currently ranked No. 3 in elite Tests and fifth in one-day internationals. To contact the editor responsible for this story: Dan Baynes at dbaynes@bloomberg.net

Wolin Says Treasury Will Resist Efforts to Slow Dodd-Frank

http://www.bloomberg.com/news/2011-04-19/wolin-says-treasury-will-resist-efforts-to-slow-dodd-frank-rules.html

Deputy Treasury Secretary Neal Wolin said the Obama administration will resist efforts by lobbyists and Republican lawmakers to slow the changes required by the Dodd-Frank overhaul of U.S. financial regulations. “We must move forward with implementing this law,” Wolin said today in a speech at the Pew Charitable Trusts in Washington. “We are doing so quickly, carefully and responsibly. We will continue to do so in the face of these criticisms. And we will continue to oppose efforts to slow down, weaken, or repeal these essential reforms .” Dodd-Frank, the sweeping rules overhaul enacted last year, created a council of regulators to expand oversight of the country’s biggest financial firms in response to the 2008 credit crisis that led to the collapse of Lehman Brothers Holdings Inc. The law also bolsters supervision of derivatives trading as well as consumer lending and proprietary trading by banks. Republican lawmakers, including House Financial Services Committee Chairman Spencer Bachus , wrote to regulators in March, urging them to slow implementation to ensure there is sufficient time to gather public comment and to ensure the new rules don’t inhibit economic growth. ‘Speed Kills’ “All of us know that on the highway ‘speed kills,’” Bachus of Alabama said today in a statement responding to Wolin’s remarks. “Speed can also kill jobs when Washington rushes sweeping regulations into place without giving the public adequate time to comment.” The Securities Industry and Financial Markets Association, Wall Street’s biggest lobbying group, said Dodd-Frank shouldn’t be rushed “for the sake of meeting arbitrary deadlines,” according to a statement released after Wolin’s speech. “Rushing to meet deadlines without proper thought, analysis and coordination amongst regulators will only result in a fragmented regulatory structure, regulatory arbitrage, and uncertainty in the market place,” Tim Ryan, Sifma’s president and chief executive officer, said in the statement. Moving too hastily “would lead investors to withhold capital desperately needed to fuel economic growth,” he said. Regulators are taking steps to make derivatives markets more resilient and transparent to reduce the risk and costs of a potential crisis, Wolin said. Proposed rules take into account the lower risk posed by commercial end-users who use derivatives contracts to hedge operations rather than to speculate, he said. ‘Further Clarified’ “The statute does not allow capital requirements to be imposed on commercial end-users of derivatives,” Wolin said. “Recently, the regulators have further clarified in the proposed rules that when these end-users operate within established risk limits, they will not have to post margin on their contracts -- leaving that capital free for job creation and investment.” Regulators have proposed two sets of rules for margin requirements in swap transactions that may force commercial end- users such as airlines and large manufacturers to set aside money to reduce risk in certain trades. End-users would escape margin requirements in swaps with non-bank dealers or major swap participants under a proposal by the Commodity Futures Trading Commission. A joint proposal released by the Federal Deposit Insurance Corp. , the Federal Reserve and three other regulators could force end-users to post margin in swaps with banks. Wolin also said the Office of Financial Research, created by the law to help agencies collect and coordinate information, is “hard at work” even though it doesn’t have a director. He said he expects a voting member who specializes in insurance oversight to be named “quite soon” to the Financial Stability Oversight Council. To contact the reporter on this story: Rebecca Christie in Washington at rchristie4@bloomberg.net To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

Pop. Milano to Raise Up to 1.2 Billion Euros to Boost Capital

http://www.bloomberg.com/news/2011-04-19/pop-milano-to-raise-up-to-1-2-billion-euros-to-boost-capital.html

Banca Popolare di Milano Scarl (PMI) plans to raise as much as 1.2 billion euros ($1.7 million) by selling new shares after the Bank of Italy asked the country’s oldest cooperative bank to strengthen capital. The Milan-based lender will ask shareholders at a meeting in June to approve the plan, it said in a statement today. Popolare di Milano joins other Italian lenders including Intesa Sanpaolo SpA, Unione di banche Italiane SCPA, Banco Popolare SC and Banca Monte dei Paschi di Siena SpA, that this year asked investors for a total of 11.5 billion euros through capital-raising plans. Pop. Milano, which has to reimburse a 500 million-euro government bond by 2013, received a letter from the Bank of Italy asking it to reinforce its capital, two people familiar with the situation said April 14. The central bank also expressed concern about the lender’s governance because of the presence of labor unions on the board, the people said. The bank expects to have a core Tier 1 capital ratio of 9.8 percent in 2013 following the capital increase. It also plans to sell “non-strategic minority interests,” to further boost capital, it said today. Banca Akros SpA and Mediobanca SpA will manage the share sale. To contact the reporter on this story: Sonia Sirletti in Milan at ssirletti@bloomberg.net To contact the editor responsible for this story: Frank Connelly at fconnelly@bloomberg.net

Kazakhs to Manage Stakes in Failed Lenders Via New Vehicle

http://www.bloomberg.com/news/2011-04-19/kazakhs-to-manage-stakes-in-failed-lenders-via-new-vehicle-1-.html

Kazakhstan will consolidate state stakes in BTA Bank, Temirbank and Alliance Bank, three of the four Kazakh lenders that defaulted in 2009, in a new management company, central bank Chairman Grigori Marchenko said. Yelena Bakhmutova, former chief of the disbanded Agency for Financial Supervision, will head the new company, which will be under management of the National Wellbeing Fund Samruk-Kazyna, Marchenko told reporters in Almaty today. The state-owned Samruk-Kazyna bought a stake in BTA in early 2009 and the government later took over Temirbank and Alliance after credit markets froze and the country’s property bubble burst. BTA, Temirbank and Alliance Bank have reached restructuring deals with creditors, allowing them to write off about $11 billion of debt. The government owns 81.48 percent of ordinary shares in BTA, 67 percent in Alliance and 79.9 percent in Temirbank, according to the Kazakhstan Stock Exchange website. Kuat Kozhakhmetov, former deputy chief of the Agency for Financial Supervision, was appointed acting head of a new financial supervision committee in the central bank, Marchenko said. The regulator was disbanded, with its functions transferred to the central bank, according to Marchenko. To contact the reporter on this story: Nariman Gizitdinov in Almaty at ngizitdinov@bloomberg.net To contact the editor responsible for this story: Steve Voss at sev@bloomberg.net

Richest Polish Banker Bets on Mortgages for 10% Growth

http://www.bloomberg.com/news/2011-04-19/poland-s-richest-banker-czarnecki-sees-home-loans-pushing-growth-above-10-.html

Leszek Czarnecki, the Polish banking billionaire who owns Getin Holding SA (GTN) , says rising demand for mortgages and corporate banking services will keep his group’s annual asset growth over 10 percent in coming years. Getin, Poland’s best-performing financial stock this year, is considering more takeovers to spur growth after buying banks from Allianz SE (ALV) and Ally Financial Inc. in 2010 as foreign investors sold assets amid the global credit crisis, Czarnecki said in an interview in his Warsaw office. Its biggest competitors are units of UniCredit SpA (UCG) , Commerzbank AG (CBK) and ING Groep NV (INGA) as well as Poland’s PKO Bank Polski SA. “Most of the Polish banking sector is owned by huge global players, whose appetite for growth, new portfolio and new credit was reduced significantly,” Czarnecki said. “This is actually our window for growth” either by acquisitions or by expanding current operations. Shares of Getin, which owns Getin Noble Bank SA, insurer Europa SA and financial-services broker Open Finance SA, fell 0.5 percent to 14.82 zloty at 12:21 p.m. in Warsaw, trimming this year’s gain to 30 percent to value the group at $3.8 billion. Czarnecki owns 56 percent of Getin, whose assets more than doubled in the last three years to 47 billion zloty. “After the 2009 slowdown we have a rebound, and this year and 2012 should be really good” for the banking industry, Marcin Materna, an analyst at Bank Millennium SA, said by telephone. “Revenue and fees keep rising, and Getin has the fastest growth pace in the sector.” Profits Surge In Poland , the largest central European country and the only economy to avoid recession in 2009, banking profits surged 41 percent in 2010 from a year earlier. Gross domestic product is expected to grow by about 4 percent this year and next, according to government estimates, compared with forecasts for the euro region of 1.6 percent this year and 1.8 percent in 2012, according to the International Monetary Fund. The projections for growth in central and eastern Europe are of 3.7 percent this year and 4 percent in 2012. “My feeling is really very positive, at least for the next three to five years,” said Czarnecki, 48, the third-wealthiest Pole after Jan Kulczyk , who owns brewing, automotive and infrastructure assets and Zygmunt Solorz-Zak, a media investor, according to the local edition of Forbes. “I strongly believe that we will reach double-digit growth while the whole Polish banking sector may grow about five or eight percent” a year. Ukraine, Belarus, Russia Getin was the second-largest mortgage lender in Poland last year and started Idea Bank SA, a lender for small and medium- sized enterprises. It’s also expanding banks in neighboring Ukraine, Belarus and Russia. “In consumer finance, I would expect double-digit growth as the level of retail loans in Poland is far below that in developed countries,” said Czarnecki. “Corporate banking will probably be the most rapidly growing segment in Poland, in all kinds of forms, including credits, leasing, factoring and corporate finance.” Polish banks awarded 48.6 billion zloty in home loans last year, up 26 percent from a year earlier, according to data on the banking association’s website. The industry group expects this year mortgages will be close to the 2010 level. Czarnecki, who holds the world’s record for the longest passage in cave-diving , in 2001 sold Europejski Fundusz Leasingowy SA, Poland’s first leasing company, to Credit Agricole SA (ACA) for 412 million euros and a 25 percent stake in the French bank’s Polish unit, and reinvested the money into the Getin group. Underwater Engineering The leasing company was founded in 1991 after Czarnecki sold the underwater engineering company he started five years earlier. Czarnecki, a graduate in sanitation engineering who holds a Ph.D. in economics has no plans to sell his stake in Getin even as valuations are more than twice the European average. Banks listed on the Warsaw Stock Exchange on average trade at 2 times book value, compared with the 0.9 times average for banks in the Bloomberg Europe Banks and Financial Services Index. Getin trades at 2.4 times book value, Bloomberg data showed. “We have no plans to sell Getin but on the other hand I must say I’m a very pragmatic man,” Czarnecki said. “We’re in no talks and no one has approached us to buy the group.” Poland is also one of the few markets where bank assets are for sale as some Western lenders pull out to repair balance sheets or comply with European Union conditions for state aid. Basel Requirements Because western banks will also need to prepare for higher capital requirements under the Basel III regulations, Czarnecki expects fewer foreign investors to bid for Polish financial assets than a decade ago. “Nevertheless, some players will still seek to expand in Europe and will come to Poland,” he said. Banco Santander SA (SAN) of Spain in March completed a 4 billion- euro ($5.8 billion) purchase of Poland’s Bank Zachodni WBK SA (BZW) from Allied Irish Banks Plc, and Raiffeisen Bank International AG (RBI) of Austria in February agreed to buy EFG Eurobank Ergasias SA’s Polish business in a 490 million-euro transaction that will allow it to almost double assets in the country. “Poland is a European Union member, expands quite rapidly and is a very interesting market for everybody,” Czarnecki said. “I believe that a few more players will still want to throw their weight around in Europe and will come to Poland.” For Related News and Information: To contact the reporters on this story: Pawel Kozlowski in Warsaw at pkozlowski@bloomberg.net ; Marta Waldoch in Warsaw at mwaldoch@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

Brazil to Approve BP, Devon Deal Soon, Regulator Says

http://www.bloomberg.com/news/2011-04-19/brazil-regulator-to-approve-bp-devon-deal-soon-chambriard-says.html

BP Plc (BP/) , whose stock lost a third since the biggest U.S. oil spill, will get Brazil’s approval to buy Devon Energy Corp.’s assets in the country shortly, a government official said. The Brazilian oil regulator has authorized BP to operate in the country and there should be “no problem” approving the $3.2 billion purchase of Devon’s exploration blocks, including areas in deep waters of the Campos Basin, Magda Chambriard, a director at the agency, told reporters in Rio de Janeiro today. BP has signed exploration agreements in Australia, Russia and India this year as it expands in emerging markets. Brazil is a “critical” country for BP because U.S. exploration has slowed after the spill at the offshore Macondo well last year, said Gianna Bern , president of Brookshire Advisory and Research, a Chicago-based adviser to oil producers. “Reducing exposure to the U.S. Gulf of Mexico is going to be increasingly important to BP,” said Bern in a telephone interview. “The permitting process is going to be very slow in the Gulf of Mexico.” To contact the reporter on this story: Peter Millard in Rio de Janeiro at Pmillard1@bloomberg.net To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

Scangroup of Kenya Climbs Most in 6 Months as Profit Surges

http://www.bloomberg.com/news/2011-04-19/scangroup-of-kenya-full-year-profit-surges-as-advertising-spending-jumps.html

Scangroup Ltd., East Africa’s biggest marketing company by sales, climbed the most in six months after saying full-year profit rose 60 percent as revenue surged on “significant growth” in advertising spending. Net income advanced to 640.6 million shillings ($7.64 million) in the 12 months through December from 401.2 million shillings a year earlier, the Nairobi-based company said in a statement distributed by the city’s stock exchange today. Billings more than doubled to 11.4 billion shillings, it said. The “increase in advertising spend benefited the company and its Ogilvy subsidiary,” Sterling Investment Bank Ltd., a Nairobi-based brokerage, said in an e-mailed note to clients. Scangroup acquired 50 percent of Ogilvy East Africa and 51 percent of Ogilvy Africa in October in a cash and stock transaction worth 418 million shillings. Advertising spending is accelerating in Kenya amid expectations that growth in East Africa’s largest economy may accelerate to 5.7 percent this year from 5.2 percent last year. Scangroup’s clients include Kenya Airways Ltd. (KNAL) , the national airline, Kenya Commercial Bank , the nation’s biggest lender by outlets, and Serena Hotels. Scangroup shares jumped 7.7 percent to 56 shillings by the 3 p.m. close in Nairobi, the biggest increase since Oct. 7. The stock has declined 8.9 percent this year, compared with a 9.4 percent drop in the benchmark NSE 20 index over the same period. The company’s directors proposed a bonus share for every five held and a dividend of 70 cents each, according to the company statement. To contact the reporter on this story: Eric Ombok in Nairobi at eombok@bloomberg.net. To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net .

Crude Oil Rises for Second Day on Improving Outlook for Global Fuel Demand

http://www.bloomberg.com/news/2011-04-19/oil-near-two-day-high-after-u-s-housing-starts-beat-economist-forecasts.html

Oil advanced for a second day in New York , climbing more than $1 a barrel, as signs of an improving economy in the U.S., the world’s biggest consumer of crude, stoked speculation demand for fuel may increase. Futures for June delivery gained as much as 1.2 percent, extending yesterday’s 0.6 percent increase, before a report forecast to show an improving U.S. housing market. Oil also rose as earnings at companies from Intel Corp. to South Korea ’s LG Chem Ltd. bolstered confidence in the economic recovery. “We could expect more of an upbeat reporting season, and that may feed through to optimism,” said Jonathan Barratt , managing director of Commodity Broking Services Pty in Sydney. Crude oil for June delivery rose as much as $1.32 to $109.60 a barrel in electronic trading on the New York Mercantile Exchange. It was at $109.55 at 9:38 a.m. London time. Yesterday, it added 59 cents to $108.28, the highest since April 15. The May contract, which expired yesterday, gained $1.03 to settle at $108.15. Brent crude for June settlement climbed $1.37, or 1.1 percent, to $122.70 a barrel on the London-based ICE Futures Europe exchange. Yesterday, it slipped 28 cents, or 0.2 percent, to $121.33. Purchases of existing U.S. homes climbed 2.5 percent in March after dropping 9.6 percent in February, according to a Bloomberg News survey before the National Association of Realtors report today. A Commerce Department report yesterday showed work began on 549,000 houses at an annual pace, up 7.2 percent from the prior month and exceeding the 520,000 median forecast of economists surveyed by Bloomberg News. Weaker Dollar The Dollar Index, a measure of the currency versus those of six U.S. trading partners, slid for a second day to 74.69, Bloomberg data showed. It is down 5.5 percent since the start of the year. A decline in the dollar makes commodities priced in the U.S. currency more attractive for investors. “The weaker U.S. dollar and stronger equities offset concerns over European sovereign debt and slowing demand from high oil prices ,” Mark Pervan , head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in a note today. U.S. crude oil stockpiles rose 667,000 barrels last week to 356.1 million, according to the industry-funded American Petroleum Institute. An Energy Department report today may show supplies increased 1.3 million barrels from 359.3 million, according to a Bloomberg News survey of analysts. Gasoline supplies fell 1.8 million barrels to 212.7 million and distillate fuels, including diesel, declined 3.4 million barrels to 146.8 million, the API said. Housing Starts The Commerce Department said work began on 549,000 houses at an annual pace, up 7.2 percent from the prior month and exceeding the 520,000 median estimate of economists surveyed by Bloomberg News. The Standard & Poor’s 500 Index added 0.6 percent to 1,312.62 at the 4 p.m. close in New York. Oil traded at the highest since 2008 last week as fighting in Libya threatened to prolong supply cuts from Africa ’s third largest producer. Unrest in the Middle East and North Africa has toppled leaders in Egypt and Tunisia and spread to Libya, Algeria, Bahrain, Iran, Oman, Syria and Yemen. Libyan crude output, which averaged 1.6 million barrels a day last year, shrank to 390,000 barrels a day in March, according to a Bloomberg News survey of producers, analysts and companies. Syrian activists said at least 18 protesters have died in clashes in the three days since President Bashar al-Assad ordered the Cabinet to make changes aimed at calming dissent. The government blamed terrorists for the violence, saying a general and three relatives were killed. Nigerian President Goodluck Jonathan suspended his interior minister after protests against his election victory killed at least six people in Africa’s biggest oil producer. Clashes between Christians and Muslims broke out for a second day in the northern city of Kaduna, Shehu Sani, head of the Civil Rights Congress, said April 18. To contact the reporter on this story: Ben Sharples in Melbourne at bsharples@bloomberg.net To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

Sinopec’s Cut in Chemical Output to Lift Prices, Analyst Says

http://www.bloomberg.com/news/2011-04-19/sinopec-s-cut-in-chemical-output-to-lift-prices-analyst-says.html

Dow Chemical Co. (DOW) and other ethylene producers will obtain higher prices as China Petrochemical Corp. cuts chemical output to bolster domestic fuel supplies, said an analyst at Alembic Global Advisors. Sinopec Group, as Asia ’s biggest oil refiner is known, is halting fuel exports and cutting petrochemical production to boost output of gasoline and diesel for domestic use, the Beijing-based company said in its online newsletter today. It has about 6.5 percent of global supply of ethylene, used to make plastics, Hassan Ahmed , an Alembic analyst, said today. Sinopec’s cut will make ethylene markets tighter and help price increases exceed 1.25 cents per pound in April and 2 cents in May, the current forecast from Houston-based Chemical Market Associates Inc., New York-based Ahmed said in a note. Ethylene is currently about 54 cents a pound, he said. Beneficiaries include Dow Chemical, LyondellBasell Industries NV (LYB) , Westlake Chemical Co., Industries Qatar and Saudi Basic Industries Corp. (SABIC) , he said. Sinopec may reduce ethylene output by 10 percent in May, ICIS News reported yesterday, citing an unnamed person close to the company. To contact the reporter on this story: Jack Kaskey in Houston at jkaskey@bloomberg.net. To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net .

Brazil Real Climbs as Growth Optimism Overshadows Debt Concern

http://www.bloomberg.com/news/2011-04-19/brazil-real-climbs-as-growth-optimism-overshadows-debt-concern.html

Brazil ’s real gained as corporate earnings and economic data in the U.S. and Europe beat analysts’ estimates, boosting risk appetite and overshadowing sovereign debt concern. The real advanced 0.5 percent to 1.5828 per dollar at 11:15 a.m. New York time, from 1.5900 yesterday. Stocks in Europe rebounded from the biggest drop in a month and U.S. index futures advanced after Burberry Group Plc, Britain’s biggest luxury retailer, said sales jumped 32 percent in the most recent quarter, while Goldman Sachs Group Inc., the fifth-biggest U.S. bank by assets, reported earnings per share that were almost double analysts’ estimates. European services and manufacturing growth unexpectedly accelerated in April, suggesting the region’s economy is weathering surging energy costs and tougher austerity measures. “There’s less risk aversion with the stocks recovering from yesterday’s plunge,” said Luciano Rostagno , chief strategist at CM Capital Markets Ltda., the fourth-biggest currency broker on the BM&FBovespa exchange. “The European data came better than expected,” he said in a telephone interview from Sao Paulo. Standard & Poor’s yesterday lowered its outlook to negative on the AAA credit rating of the U.S. Yields on interest-rate futures contracts due in January fell 1 basis point, or 0.01 percentage point, to 12.26 percent. The May contract indicated traders are splitting on whether policy makers will raise the Selic rate by 25 basis points or 50 basis points from 11.75 percent at a meeting tomorrow. To contact the reporters on this story: Josue Leonel in Sao Paulo at jleonel@bloomberg.net ; Gabrielle Coppola in Sao Paulo at gcoppola@bloomberg.net To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

S&P Tells Biggest Debtor Don’t Blow Final Act: Caroline Baum

http://www.bloomberg.com/news/2011-04-19/s-p-tells-biggest-debtor-don-t-blow-final-act-commentary-by-caroline-baum.html

Rarely has a credit rating company made such an astute observation of the human condition. “We believe there is a material risk that U.S. policy makers might not reach an agreement on how to address medium- and long-term budgetary challenges by 2013,” Standard & Poor’s said on assigning a negative outlook to the U.S. AAA-credit rating Monday. Any observer of the budget debate in Washington would have to believe there’s a material risk, too. The U.S. Treasury , aware that any rise in interest rates from increased credit risk would further damage its fiscal position, was quick to counter S&P’s shot across the bow. The negative outlook “underestimates the ability of America’s leaders to come together” to solve the debt problem, Assistant Secretary for Financial Markets Mary Miller said. Come together? Miller must be watching a different theatrical production than I am. Treasury Secretary Tim Geithner was shuttled off to TV business channels yesterday to tell us that, unlike S&P, his outlook on the U.S. fiscal situation isn’t negative. Take a look at the first four acts of this drama, and you decide who’s right. Act I: Dec. 1, 2010. Moment of Truth. President Barack Obama ’s National Commission on Fiscal Responsibility and Reform releases its report. The commission’s plan relies on tax simplification and spending cuts to increase revenue. It aims to save $4 trillion over 10 years, reducing projected budget deficits to 2.3 percent of gross domestic product by 2015 from an estimated 10.9 percent this year. It includes a rise in the Social Security retirement age, lower federal entitlement benefits, a three-year freeze on federal workers’ pay and the elimination of “tax expenditures,” or the estimated $1.1 trillion of revenue lost each year to tax exemptions and loopholes. Small-government conservatives are unhappy that outlays as a share of GDP would increase to 21 percent, above the long-term average. Most everyone else sees the commission’s report as a fine start. Act II: Feb. 14, 2011. La-La Land. Obama ignores the recommendations of the commission and submits his $3.7 trillion budget request for fiscal 2012 to Congress. The blueprint is long on generalities and short on specifics. It purports to return annual deficits to a “sustainable” level by mid-decade but fails to address entitlement spending on programs such as Medicare, Medicaid and Social Security. Obama’s budget looks a lot like the Congressional Budget Office ’s baseline, or auto-pilot projection, over the next 10 years and is sustainable only to the extent that the current trajectory of spending and revenue is sustainable. Act III: April 5, 2011. “Path to Prosperity.” House Budget Committee Chairman Paul Ryan , Republican of Wisconsin , offers his plan to cut spending and simplify the tax code , lowering the rates and broadening the base. Ryan is applauded for his bold vision and reviled (by Democrats) for his bold vision. Ryan’s plan slashes government spending to below 20 percent of GDP and lowers the top tax rate for households and business to 25 percent from its current 35 percent. He claims to find cost savings by harnessing competition, allowing future retirees to choose a Medicare plan from private insurers while providing assistance for lower-income beneficiaries with greater health risks. Act IV: April 13, 2011. Get Serious. Obama tells an audience at George Washington University the U.S. has to live within its means and pay down its debt. Any serious plan to tackle the deficit has to address entitlements, he says. (See Act II for his unserious plan.) The president spends more time explaining how we got here (Bush’s fault) and trashing the Ryan budget than advocating for his own. His role in the debt binge is limited to emergency spending in response to the financial crisis he inherited. Obama proposes to reduce the deficit by $4 trillion in 12 years by cutting discretionary spending, finding savings in the defense budget , reducing the cost of health care via Obamacare and eliminating tax breaks. The president will protect seniors, the middle class and investments in education, medical research and clean energy by taxing the rich. Act V: Sometime in the future. “Pray for the Gang of Six.” In the final act of a Shakespearean tragedy, the conflict is resolved. In real life, the two political parties are on opposite sides of the stage separated by what President George H.W. Bush called the “vision thing.” Former Senator Alan Simpson , co-chair of the president’s deficit commission, summed up the impasse after listening to Obama’s partisan speech last week, telling reporters to “Pray for the Gang of Six.” The Senate’s bipartisan “Gang of Six” has yet to complete or release its deficit-reduction proposal. The fact that the three Democrats and three Republicans can be in the same room together offers the best hope for some kind of compromise. Obama has yet to invite Ryan to the White House even though the congressman has been teeing up budget ideas for a couple of years. Some analysts viewed S&P’s surprise shift to a negative outlook for the U.S.’s long-term credit rating as a timely kick in the pants. If the warning of higher borrowing costs -- Treasuries rallied Monday -- creates some urgency to address these problems now, then it was a good thing. Of course, there’s bad news too. As with earlier downgrades to companies about to go under, S&P may already be late. ( Caroline Baum , author of “Just What I Said,” is a Bloomberg News columnist. The opinions expressed are her own.) To contact the writer of this column: Caroline Baum in New York at cabaum@bloomberg.net. To contact the editor responsible for this column: James Greiff at jgreiff@bloomberg.net

Bernanke May Reinvest Maturing Debt to Avoid ‘Cold Turkey’ End to Stimulus

http://www.bloomberg.com/news/2011-04-19/bernanke-may-reinvest-maturing-debt-to-avoid-cold-turkey-end-to-stimulus.html

Federal Reserve Chairman Ben S. Bernanke may keep reinvesting maturing debt into Treasuries to maintain record stimulus even after making good on a pledge to complete $600 billion in bond purchases by the end of June. The Fed chief’s top two lieutenants said this month the economy and inflation are too weak to warrant the start of a monetary-policy reversal. Investors and economists including David Kelly at JPMorgan Funds see that as a signal the Fed will keep its balance sheet at current levels by replacing about $17 billion a month in maturing mortgage debt with Treasuries. Ending the reinvestment policy and the $600 billion program at the same time would be like quitting stimulus “cold turkey,” said Kelly, who is based in New York and helps oversee $400 billion as chief market strategist at JPMorgan. “It does make sense to reinvest for a while,” he said. “Then they could watch how bond yields react to that.” Yields on 10-year Treasuries declined to 2.49 percent from 2.76 percent in the two weeks following the Fed’s Aug. 10 decision to begin reinvesting payments on assets purchased during the first round of bond buying from December 2008 until March 2010. An end to the reinvestment policy should be seen by investors as the first step in a tightening of credit by the Fed, said Neal Soss, chief economist at Credit Suisse Group AG. Soss is among economists who say the Federal Open Market Committee at the end of its April 26-27 meeting will probably affirm its plan to halt Treasury purchases on schedule. Debate Starts Fed officials are starting to debate what steps to take after completing the purchases, a program dubbed QE2 for the second round of quantitative easing. Policy makers were divided at their last meeting on March 15, with a “few” officials saying tighter credit may be warranted this year, while a “few others noted that exceptional policy accommodation could be appropriate beyond 2011.” Janet Yellen , the Fed’s vice chairman, said April 11 that surging commodity costs over the past year are “unlikely to have persistent effects on consumer inflation or to derail the economic recovery and hence do not, in my view, warrant any substantial shift in the stance of monetary policy.” William C. Dudley, president of the Federal Reserve Bank of New York and the FOMC’s vice chairman, said April 1 that the recovery is “still tenuous,” while Bernanke said April 4 that higher commodity prices may have just a “transitory” effect on inflation. Bernanke last month identified ending the reinvestment policy as one of the Fed’s tools for exiting stimulus and draining reserves from the financial system. ‘Tone’ of Indicators The Fed chief may be asked how long the reinvestment policy will be maintained in a press conference April 27, and “he’ll probably say that will depend upon the tone of the economic indicators in the months ahead,” said James Kochan , who helps manage $231 billion as chief fixed-income strategist at Wells Fargo Fund Management LLC in Menomonee Falls , Wisconsin. “The first step is to end QE2,” Kochan said. “The next step will be to stop reinvesting the proceeds from the portfolio. I don’t know when that’s going to happen, but maybe around the turn of the year.” The FOMC decision in August to start the reinvestment program initially fanned investor anxiety that the recovery would falter. Bernanke said later that month the policy was aimed at keeping borrowing costs low and that the Fed was weighing more securities purchases, a move announced on Nov. 3. Yields Rise Since then, yields on 10-year Treasuries increased to 3.38 percent as of yesterday from 2.57 percent. The Standard & Poor’s 500 Index gained 9 percent, while the dollar weakened by 1.3 percent against an index of six currencies. Ten-year yields touched the lowest level in three weeks even after Standard & Poor’s yesterday lowered the outlook on its AAA rating for long-term U.S. debt to negative. Most of the 50 analysts in a Bloomberg News survey last month expected the Fed to keep its bond portfolio stable for some time after the purchases end, with a plurality of 16 betting on a period of four to six months. Five economists said the Fed would halt the policy once QE2 ends; 11 said it would keep reinvesting for one to three months; 14 said seven to nine months, and four said more than nine months. “If necessary, the Federal Reserve can also drain reserves by ceasing the reinvestment of principal payments on the securities it holds or by selling some of those securities in the open market,” Bernanke said in semiannual monetary-policy testimony before the House and Senate on March 1 and March 2. Federal Reserve Bank of Philadelphia President Charles Plosser , part of a minority of policy makers who favor a tougher approach to controlling inflation, said in a March 25 speech that ending reinvestment is one of the first steps in his preferred exit method. ‘Headwinds’ to Growth “Headwinds” against U.S. growth, including higher gasoline prices, reduced spending by state and local governments and a housing industry that’s “flat on its back” make it difficult for Fed officials to end the reinvestment policy, former Fed Governor Lyle Gramley said. “The economy has a lot of problems,” said Gramley, now senior economic adviser with Potomac Research Group in Washington. “If I had to call the shots today, I would say continuing to reinvest the proceeds from maturing issues is better than a 50-50 chance.” Extending the policy in the coming months would mean that a later decision to end it would signal the Fed’s broader exit from near-zero interest rates , said Soss, based in New York. “It wasn’t a package deal at the beginning, and I don’t think that it’s a package deal at this juncture,” said Soss, who worked as an aide to former Fed Chairman Paul Volcker. “An announcement about not reinvesting would be a new policy innovation and undoubtedly should be viewed as the first move in a tightening program.” To contact the reporter on this story: Scott Lanman in Washington at slanman@bloomberg.net. To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

Thailand’s Inflation to Be Below Forecast on Oil Tax Cut

http://www.bloomberg.com/news/2011-04-19/thailand-s-inflation-to-be-below-forecast-on-oil-tax-cut-1-.html

Thailand ’s inflation rate this year will be lower than initially forecast because of the government’s plan to reduce taxes on fuel, central bank Governor Prasarn Trairatvorakul said. Inflation will be 0.7 percentage point lower than the current forecast of 3 percent to 5 percent, and core inflation will be 0.3 percentage point lower than the existing forecast of 2 percent to 3 percent, Prasarn said in Bangkok. Prime Minister Abhisit Vejjajiva said yesterday the government planned to cut taxes on diesel to help cap the retail price at less than 30 baht per liter and ease the burden on the state oil fund, which is used to subsidize fuel. The measure, which the government expects will last until September, will cost about 45 billion baht ($1.5 billion). “The tax cut can suppress inflation only in the short term as it can’t stay forever,” Deputy Governor Atchana Waiquamdee said at the same event today. “Once the program ends, inflation will spike up. This will distort oil prices and also distort the behavior of oil users. The government should use this money to develop infrastructure projects.” Oil prices will remain high this year, before easing next year, Prasarn said. To contact the reporter on this story: Suttinee Yuvejwattana in Bangkok at suttinee1@bloomberg.net To contact the editor responsible for this story: Tony Jordan at tjordan3@bloomberg.net

Adidas Retains Bayern Munich Uniform-Supply Deal Through 2020

http://www.bloomberg.com/news/2011-04-19/adidas-retains-bayern-munich-uniform-supply-deal-through-2020.html

Adidas AG (ADS) , the world’s second- largest sporting goods maker, will keep the right to supply uniforms to Germany ’s Bayern Munich through 2020, extending a 50-year partnership. Bayern, Germany’s most successful soccer club, will sell its new home jerseys beginning May 13, Adidas said in a statement today. Adidas owns 9.4 percent of FC Bayern Muenchen AG, the club-controlled company which operates the commercial soccer department. To contact the reporter on this story: Holger Elfes in Dusseldorf at helfes@bloomberg.net. To contact the editor responsible for this story: Celeste Perri at cperri@bloomberg.net

S. Africa’s Eastern Cape Plans Crops for Employment, Business Day Reports

http://www.bloomberg.com/news/2011-04-19/s-africa-s-eastern-cape-plans-crops-for-employment-business-day-reports.html

Officials in South Africa’s Eastern Cape province identified four plants that may revive agriculture and create employment in the region, Business Day reported, citing Sitembele Mase, Chief Executive Officer of the Eastern Cape Development Corp. Pineapple, flax, hemp and agave americana have been singled out for their ability to produce fibre, which can be used in the textile and construction industries, the Johannesburg-based newspaper reported. The company plans plants to process pineapple waste in East London and Bathurst by 2014, while an Agave factory is planned in the town of Graaff Reinet, Business Day said. To contact the reporter on this story: Lauren van der Westhuizen in Cape Town at lvanderwesth@bloomberg.net To contact the editor responsible for this story: Ana Monteiro at amonteiro4@bloomberg.net

U.S. Crude Oil Supplies Rose a Seventh Week, Survey Shows

http://www.bloomberg.com/news/2011-04-19/u-s-crude-oil-supplies-rose-a-seventh-week-survey-shows-1-.html

U.S. crude-oil inventories probably increased for a seventh week as imports rebounded from a one- month low, a Bloomberg News survey showed. Supplies climbed 1.3 million barrels in the seven days ended April 15 from 359.3 million a week earlier, according to the median of 13 analyst estimates before an Energy Department report tomorrow. Eleven respondents forecast a gain, one projected a decline and one said there was no change. Crude-oil imports slipped 4.2 percent to 8.57 million barrels a day in the week ended April 8, the lowest level since the seven days ended March 4, according to the department. Imports arrived at an average rate of 9.1 million barrels a day over the past year. “It looks like imports should increase,” said Peter Beutel , president of Cameron Hanover Inc., an energy-advisory company in New Canaan , Connecticut. “Imports have been very low and we’ve still seen inventories increase. If imports climb, we could get a surprisingly big gain.” Refineries probably operated at 82.3 percent of capacity, up 0.9 percentage point from the prior week, according to the Bloomberg News survey. Units are often idled in February and March as their owners prepare for the switch from the peak- demand period for heating oil to the summer months when gasoline consumption surges. Gasoline inventories declined 1.5 million barrels from 209.7 million last week, the survey showed. Nine of the respondents projected a drop and four anticipated a gain. Supplies of distillate fuel, a category that includes heating oil and diesel, probably rose 300,000 barrels from 150.8 million. Seven of the analysts anticipated an increase, five said there was a decline and one projected no change. The department is scheduled to release its weekly report at 10:30 a.m. tomorrow in Washington. 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

Pfizer, J&J Must Train U.S. Doctors on Safe Use of Painkillers

http://www.bloomberg.com/news/2011-04-19/pfizer-j-j-must-train-u-s-doctors-on-safe-use-of-painkillers.html

Pfizer Inc. (PFE) , Johnson & Johnson (JNJ) and Endo Pharmaceuticals Holdings Inc. (ENDP) will have to train doctors before they can give patients extended-release painkillers under a U.S. plan aimed at reducing prescription drug abuse. Sixteen companies that make 25 pain patches and pills must create a program to teach medical professionals when these drugs should be used to combat pain and how to recognize signs that the treatments are being misused, the Food and Drug Administration said today. The Obama administration is urging Congress to mandate the training as part of licensing required by the Drug Enforcement Administration every three years. The FDA began discussing in February 2009 how best to prevent deaths and side effects from overdose or tampering of long-acting painkillers to get high. While the agency has stopped short of restricting drug distribution, tougher controls may follow if abuse isn’t curbed, said Janet Woodcock , director of the FDA’s Center for Drug Evaluation and Research. “There’s an epidemic of prescription drug abuse that is beginning to rival that of illegal drug abuse,” Woodcock said in a telephone interview. “It’s either the kids who get it out of their medicine cabinet or someone who gets multiple prescriptions.” The medicines cited by the FDA include New York-based Pfizer’s Avinza and Embeda morphine capsules; Duragesic, a fentanyl patch made by New Brunswick, New Jersey-based J&J and generic competitors; Chadds Ford , Pennsylvania-based Endo’s Opana oxymorphone tablets; and OxyContin, an oxycodone tablet made by closely held Purdue Pharma LP of Stamford , Connecticut. High-Dose Painkillers The drugs are sustained-release, high-dose painkillers derived from the opium poppy, also known as opioids. Doctors considered these medicines to be a major breakthrough for cancer and chronic pain when they were introduced in the mid-1990s, though it became clear the drugs were easy to manipulate. Purdue agreed in 2007 to pay $634.5 million to settle claims that promotions for OxyContin from 1996 to 2001 misled doctors about the drug’s risks. The risk-minimization program is the largest ever imposed by FDA, Woodcock said. The agency gained the authority to require these types of plans as a condition for marketing under 2007 legislation. An estimated 23 million prescriptions for extended-release opioid drugs are written annually, representing about one-tenth of prescription painkillers, according to the FDA. Pfizer’s King Pharma division, acquired last month, has been developing drugs with physical and chemical properties to resist tampering. Embeda, the first of these medicines, is included in the training program because it hasn’t been proven to be safer than the older medicines, Woodcock said. To contact the reporter on this story: Catherine Larkin in Washington at clarkin4@bloomberg.net. To contact the editor responsible for this story: Adriel Bettelheim at abettelheim@bloomberg.net .

Greek Two-Year Yields Reach Record as Demand Wanes at Auction; Bunds Slide

http://www.bloomberg.com/news/2011-04-19/greek-10-year-government-bond-yields-reach-record-before-auction-of-bills.html

Greek note yields reached euro-era records amid growing speculation the country will need to restructure its debt as financing costs mount. German debt slid as data showed European services and manufacturing growth unexpectedly accelerated in April, bolstering the case for higher interest rates. Greece sold 1.625 billion euros ($2.3 billion) of 13-week bills at a higher interest rate amid lower demand than the previous auction of similar debt. Greek two-year note yields breached 20 percent for the first time yesterday. Portuguese two-year yields rose to the highest in at least 15 years today. “The fact that Greece was able to overcome this particular hurdle will provide some relief,” said Orlando Green , assistant director of capital-markets strategy at Credit Agricole Corporate & Investment Bank in London. “There’s still a concern over liquidity. There hasn’t been a shift to positive sentiment, and they’re not out of the woods yet.” Greek two-year yields rose 29 basis points to 20.62 percent, after touching 20.67 percent, the highest since at least 1998, when Bloomberg began collecting the data. The 4.6 percent security due 2013 fell 0.22, or 2.2 euros per 1,000-euro face amount, to 75.03 as of 4:16 p.m. in London. The Greek 10- year yield fell seven basis points to 14.48 percent after rising as high as 14.66 percent, a euro-era record, before the auction. Wider Spread Today’s Greek sale was priced at a yield of 4.10 percent, up from 3.85 percent at an auction of similar debt on Feb. 15. Investors bid for 3.45 times the amount of securities offered, down from the previous bid-to-cover ratio of 5.08. The yield difference, or spread, between the nation’s 10- year bonds and German securities of a similar maturity, earlier reached 1,138 basis points. That’s the most since at least 1998. Portugal ’s two-year note declined for a fifth consecutive day, pushing the yield to 10.26 percent, the highest since at least 1996. Greek government spokesman George Petalotis today “categorically” denied reports in newspapers that said Greece has asked to extend maturities of the country’s debt. The cost of insuring Greek government debt increased seven basis points to 1,260 basis points, surpassing yesterday’s record closing level, according to CMA prices for credit default swaps. Contracts on Portugal dropped from a record, falling three basis points to 618. More Problems German bunds fell for the first time in six days. A composite index based on a survey of euro-area purchasing managers in services and manufacturing industries rose to 57.8 in April from 57.6 in March, London-based Markit Economics said today. Economists had projected a drop to 57. A reading above 50 indicates expansion. The 10-year bund yield was three basis points higher at 3.28 percent, after reaching 3.225 percent, the lowest since March 24. Yields on two-year notes were six basis points higher at 1.79 percent. They earlier touched 1.716 percent, the lowest since March 25. European Central Bank Executive Board member Juergen Stark said any country seeking to renegotiate its debt obligations would find it creates more problems than it solves. “It might be perceived at some point by some policy makers as an easy way out, but it would not solve the problem,” Stark said, according to an interview published today. “On the contrary. It is extremely costly to the respective countries. If they really considered restructuring debt, they would have to pay in the future a higher risk premium .” Rate Outlook Some ECB governing council members have signaled they favor raising rates further after increasing the benchmark rate 25 basis points to 1.25 percent on April 7. Policy makers are balancing the need for higher borrowing costs in countries like Germany , where the economy is booming, against soaring bond yields in the region’s heavily indebted nations. Germany plans to auction 6 billion euros in new five-year 2.75 percent notes tomorrow, while Spain is due to sell up to 3.5 billion euros of bonds maturing in 2021 and 2024. The yield difference between Spain’s 10-year bonds and similar-maturity German bunds narrowed to 223 basis points after reaching 232 basis points earlier, the most since Jan. 28. “With Spanish yields close to the highest levels we’ve seen over the past months, there should be enough concession for the auction,” said Norbert Aul, a strategist at Royal Bank of Canada in London. “There is still a clear risk scenario with respect to the recent underperformance of Spanish paper as well, given the fact that this auction is before the Easter break.” Spanish 10-year bond yields fell four basis points to 5.51 percent. They reached 5.60 percent yesterday, the highest since Jan. 11. Two-year yields slipped five basis points to 3.52 percent, after earlier rising to 3.64 percent, also the most since Jan. 11. German government bonds have handed investors a loss of 1.8 percent this year, according to indexes compiled by the European Federation of Financial Analysts Societies and Bloomberg, while Treasuries have returned 0.6 percent. Greek debt has lost 7.4 percent, the indexes show, while Spain’s has gained 1 percent. To contact the reporters on this story: Keith Jenkins in London at kjenkins3@bloomberg.net ; Emma Charlton in London at echarlton1@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

Sunoco Said to Start Reformer Tomorrow at Philadelphia Refinery

http://www.bloomberg.com/news/2011-04-19/sunoco-said-to-start-reformer-tomorrow-at-philadelphia-refinery.html

Sunoco Inc. (SUN) is scheduled to begin restarting a reformer at its Philadelphia refinery tomorrow after maintenance, according to a person with knowledge of the work. Repairs have also been completed on a joint associated with a fluid catalytic cracker that was damaged during a flange fire April 13 at the plant, according to the person, who declined to be identified because the information isn’t public. The unit hasn’t returned to service yet, the person said. The reformer and associated units were shut in mid-March for work, according to the person. Joe McGinn, a spokesman for the company, declined to comment on operations. The Sunoco refinery has a capacity of 355,000 barrels a day, according to data compiled by Bloomberg. To contact the reporter on this story: Aaron Clark in New York at aclark27@bloomberg.net To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

Burberry Fiscal Fourth-Quarter Sales Beat Estimates on China

http://www.bloomberg.com/news/2011-04-19/burberry-fiscal-fourth-quarter-sales-beat-estimates-on-china.html

Burberry Group Plc (BRBY) , the U.K.’s largest luxury retailer, reported fiscal fourth-quarter sales that beat analysts’ estimates and confirmed that adjusted full- year profit will be near the top end of market expectations. Excluding Spain, revenue in the quarter ended March 31 rose 32 percent to 390 million pounds ($633 million) from 295 million pounds a year earlier, the London-based company said today in a statement. The average estimate of three analysts compiled by Bloomberg was for sales of 351.3 million pounds. “While the luxury industry faces global challenges in the year ahead, we remain confident in our team’s ability to outperform,” Chief Executive Officer Angela Ahrendts said in the statement. Burberry said in January that full-year adjusted pretax profit would be near the top end of a forecast of between 250 million pounds and 290 million pounds. The quarterly revenue growth was driven by retail sales in China , the trench-coat maker said today. “Another quarter of industry outperformance,” Thomas Chauvet , an analyst at Citigroup Inc. in London, wrote in an April 14 note. He has a “hold” recommendation on Burberry. Burberry closed a warehouse and stopped making a local collection in Spain last year. To contact the reporter on this story: Andrew Roberts in Milan at aroberts36@bloomberg.net. To contact the editor responsible for this story: Celeste Perri at cperri@bloomberg.net ..

Rand Undermining South Africa’s Competiveness, Trade Minister Davies Says

http://www.bloomberg.com/news/2011-04-19/rand-undermining-south-africa-s-competiveness-trade-minister-davies-says.html

South African Trade and Industry Minister Rob Davies said the strength of the rand is undermining the nation’s competitiveness and that the government needs to decide whether to act on the issue. “There is a consensus that at this level where the rand is now, the rand is uncompetitive and is having a detrimental effect, not only on exporters but also on local producers who are suffering unfair competition from imports,” Davies told reporters in Cape Town today. “There is a huge debate in South Africa about whether we should try some new things or not. We have to work on this particular issue.” The rand has gained 39 percent against the dollar since the beginning of 2009, as near-zero interest rates in developed nations encouraged investors to borrow cheaply and invest in higher-yielding markets including South Africa, where the benchmark rate is 5.5 percent. The rand traded at 6.8291 at 1:46 p.m. in Johannesburg, up from 6.8643 late yesterday. To contact the reporter on this story: Mike Cohen in Cape Town at mcohen21@bloomberg.net. To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net .

Hong Kong Short Selling Turnover Recorded 04/19/2011

http://www.bloomberg.com/news/2011-04-19/hong-kong-short-selling-turnover-recorded-04-19-2011-table-.html

Hong Kong , 04/19/2011 (Bloomberg) - Short selling was recorded on the Main Board of the Hong Kong Stock Exchange for the following companies as of 01:00 today. Number Short Percent of shares selling Total of short Tkr sold short turnover turnover to total Sym Company Name (thousand) (HK$ mln) (HK$ mln) turnover 2827 X WISECSI300ETF 192.80 7.32 11.61 63.0 3383 AGILE PROPERTY 5742 75.70 129.10 58.6 960 LONGFOR PPT 668 8.43 14.88 56.6 2314 LEE & MAN PAPER 1593 8.90 17.65 50.4 83 SINO LAND 1806 24.97 54.72 45.6 1109 CHINA RES LAND 2132 29.88 70.80 42.2 700 TENCENT 716.30 141.20 370.25 38.1 23 BANK OF E ASIA 305.80 9.94 27.28 36.5 2600 CHALCO 4308 31.26 90.52 34.5 12 HENDERSON LAND 799 43.15 128.63 33.5 44 HAECO 0.40 0.04 0.13 33.3 3377 SINO-OCEAN LAND 995.50 4.60 14.03 32.8 11 HANG SENG BANK 262.30 31.93 105.05 30.4 1044 HENGAN INT'L 644.50 40.73 136.09 29.9 2823 X ISHARES A50 15940.30 217.27 734.80 29.6 2880 DALIAN PORT 108 0.34 1.17 28.9 2000 SIM TECH 676 1.08 3.83 28.2 917 NEW WORLD CHINA 452 1.31 4.65 28.1 688 CHINA OVERSEAS 2738 43.22 155.13 27.9 762 CHINA UNICOM 6772 99.04 374.42 26.5 486 RUSAL 220 2.84 11.57 24.5 1138 CHINA SHIP DEV 514 4.59 18.76 24.4 2038 FIH 576 2.69 11.08 24.3 598 SINOTRANS 186 0.35 1.47 24.0 1055 CHINA SOUTH AIR 2476 9.69 40.64 23.8 3311 CHINA STATE CON 1126 8.23 34.98 23.5 2866 CSCL 3142 10.46 45.06 23.2 658 C TRANSMISSION 582 6.60 28.42 23.2 10 HANG LUNG GROUP 97 5.05 21.77 23.2 2688 ENN ENERGY 76 2.01 8.85 22.7 916 CHINA LONGYUAN 932 7.45 33.23 22.4 604 SHENZHEN INVEST 274 0.69 3.14 22.0 2018 AAC ACOUSTIC 72 1.40 6.37 21.9 992 LENOVO GROUP 2060 9.10 41.71 21.8 358 JIANGXI COPPER 2038 52.21 242.35 21.5 2810 X LYXORETF IND 6.70 0.88 4.14 21.1 2877 SHINEWAY PHARM 648 11.85 56.70 20.9 3808 SINOTRUK 215 1.47 7.05 20.8 1 CHEUNG KONG 496 61.68 299.46 20.6 2020 ANTA SPORTS 411 5.03 24.43 20.6 923 FOOK WOO GROUP 424 1.06 5.16 20.6 2343 PACIFIC BASIN 897 4.40 21.73 20.3 392 BEIJING ENT 112.50 4.69 23.51 20.0 322 TINGYI 136 2.72 13.67 19.9 2009 BBMG 368.50 4.41 22.32 19.7 682 CHAODA MODERN 836 4.19 21.39 19.6 1900 CHINA ITS 169 0.71 3.63 19.5 323 MAANSHAN IRON 1902 8.17 42.35 19.3 817 FRANSHION PPT 194 0.46 2.44 19.0 5 HSBC HOLDINGS 2162.80 176.45 952.28 18.5 1128 WYNN MACAU 738.80 19.93 107.94 18.5 16 SHK PPT 435 52.99 288.52 18.4 1813 KWG PROPERTY 710 4.03 22.01 18.3 2313 SHENZHOU INTL 35 0.31 1.77 17.8 291 CHINA RESOURCES 268 8.78 50.31 17.5 1387 RENHE COMM 3036 4.26 25.27 16.8 267 CITIC PACIFIC 247 5.70 34.13 16.7 27 GALAXY ENT 1144 14.45 88.53 16.3 2380 CHINA POWER 544 0.95 5.83 16.2 2828 HS H-SHARE ETF 110.20 14.60 91.13 16.0 2010 RUINIAN INT'L 114 0.63 3.98 15.9 998 CITIC BANK 3306 18.29 116.16 15.7 2388 BOC HONG KONG 925 22.59 144.82 15.6 589 PORTS 42.50 0.86 5.50 15.6 754 HOPSON DEV HOLD 122 0.99 6.38 15.5 272 SHUI ON LAND 924 3.32 21.58 15.4 522 ASM PACIFIC 65.90 6.29 40.96 15.4 2007 COUNTRY GARDEN 925 3.05 20.37 15.0 1171 YANZHOU COAL 808 22.86 153.57 14.9 308 CHINA TRAVEL HK 330 0.55 3.72 14.8 3323 CNBM 1070 30.95 210.65 14.7 142 FIRST PACIFIC 116 0.80 5.47 14.6 270 GUANGDONG INV 302 1.20 8.22 14.6 119 POLY HK INV 731 4.91 33.76 14.6 302 WING HANG BANK 21.50 1.92 13.21 14.5 1888 KB LAMINATES 172.50 1.24 8.56 14.5 983 SHUI ON CONS 26 0.28 1.91 14.5 3333 EVERGRANDE 2352 12.12 83.87 14.5 709 GIORDANO INT'L 190 1.03 7.15 14.4 127 CHINESE EST H 33.50 0.48 3.43 14.1 2338 WEICHAI POWER 199 10.75 76.84 14.0 1200 MIDLAND HOLDING 232 1.38 10.19 13.5 883 CNOOC 5571 105.04 785.91 13.4 151 WANT WANT CHINA 403 2.77 20.82 13.3 904 CHINA GREEN 144 0.86 6.48 13.3 763 ZTE 252.60 7.10 53.62 13.2 1288 ABC 8964 40.07 306.21 13.1 825 NWDS CHINA 262 1.72 13.21 13.0 914 ANHUI CONCH 580 30.74 241.62 12.7 728 CHINA TELECOM 2936 13.71 110.05 12.5 1066 WEIGAO GROUP 16 0.34 2.77 12.3 2831 X LYXORETF RUS 3.50 0.14 1.16 12.0 1898 CHINA COAL 993 10.31 86.48 11.9 330 ESPRIT HOLDINGS 323.80 10.99 93.48 11.8 347 ANGANG STEEL 432 4.51 38.42 11.7 1114 BRILLIANCE CHI 370 2.96 25.33 11.7 1800 CHINA COMM CONS 1733 12.78 111.21 11.5 1072 DONGFANG ELEC 76 2.00 18.08 11.0 1099 SINOPHARM 79.60 2.16 19.67 11.0 148 KINGBOARD CHEM 17 0.74 6.79 10.9 1818 ZHAOJIN MINING 71.50 2.70 24.82 10.9 697 SHOUGANG INT'L 1428 1.52 14.02 10.8 14 HYSAN DEV 46 1.57 14.56 10.8 3368 PARKSON GROUP 139 1.61 15.00 10.7 116 CHOW SANG SANG 132 2.66 25.21 10.6 3968 CM BANK 617.50 12.95 123.13 10.5 2238 GAC GROUP 456 4.31 41.31 10.4 656 FOSUN INTL 188 1.11 10.61 10.4 551 YUE YUEN IND 107.50 2.81 27.03 10.4 1368 XTEP INT'L 171 0.98 9.54 10.3 1393 HIDILI INDUSTRY 554 4.33 42.27 10.2 144 CHINA MER HOLD 286 10.02 97.97 10.2 336 HUABAO INTL 275 3.36 33.73 10.0 669 TECHTRONIC IND 105 1.12 11.25 9.9 881 ZHONGSHENG HLDG 71.50 1.04 10.51 9.9 1133 HARBIN POWER 240 1.92 19.86 9.6 1299 AIA 3248.60 83.61 875.97 9.5 1088 CHINA SHENHUA 880.50 31.22 332.73 9.4 2005 LIJUN INT'L 315 0.66 7.13 9.3 3993 CMOC 167 1.17 13.13 8.9 903 TPV TECHNOLOGY 26 0.13 1.42 8.9 179 JOHNSON ELEC H 180 0.88 10.18 8.7 683 KERRY PPT 97 3.78 44.63 8.5 440 DAH SING 1.60 0.08 0.94 8.3 4 WHARF HOLDINGS 182 10.22 122.84 8.3 168 TSINGTAO BREW 58 2.37 28.58 8.3 123 YUEXIU PROPERTY 950 1.56 18.91 8.2 45 HK&S HOTELS 2.50 0.03 0.41 8.2 1919 CHINA COSCO 633 4.99 61.07 8.2 1886 HUIYUAN JUICE 58.50 0.31 3.75 8.2 2331 LI NING 263 3.63 44.51 8.2 1928 SANDS CHINA LTD 518.80 11.07 136.40 8.1 2333 GREATWALL MOTOR 89 1.26 15.79 8.0 101 HANG LUNG PPT 295 10.12 127.36 7.9 386 SINOPEC CORP 2018 15.79 199.54 7.9 1038 CKI HOLDINGS 12 0.45 5.65 7.9 173 K. WAH INT'L 210 0.66 8.44 7.9 1068 YURUN FOOD 437 12.48 159.44 7.8 41 GREAT EAGLE H 18 0.48 6.22 7.8 2777 R&F PROPERTIES 229.20 2.61 33.65 7.8 135 KUNLUN ENERGY 590 7.92 103.23 7.7 1883 CITIC TELECOM 39 0.09 1.23 7.7 489 DONGFENG GROUP 948 12.34 161.67 7.6 2628 CHINA LIFE 727 21.07 279.79 7.5 828 DYNASTY WINES 426 1.29 17.32 7.5 87 SWIRE PACIFIC B 32.50 0.72 9.80 7.4 670 CHINA EAST AIR 696 2.36 32.68 7.2 3898 CSR TIMES ELEC 75 2.29 32.13 7.1 2319 MENGNIU DAIRY 156 3.82 53.60 7.1 1224 C C LAND 266 0.80 11.38 7.1 3393 WASION GROUP 30 0.12 1.76 7.0 69 SHANGRI-LA ASIA 346 7.31 106.28 6.9 3328 BANKCOMM 576 4.77 69.84 6.8 2689 ND PAPER 226 2.06 30.22 6.8 926 BESUNYEN 31 0.09 1.32 6.7 2328 PICC P&C 570 5.90 87.64 6.7 410 SOHO CHINA 371 2.50 37.35 6.7 1382 PACIFICTEXTILES 16 0.08 1.17 6.7 966 CHINA TAIPING 102 2.21 33.64 6.6 853 MICROPORT 90 0.53 8.35 6.3 316 OOIL 56 4.82 76.27 6.3 388 HKEX 317.20 56.57 899.98 6.3 631 SANY INT'L 60 0.88 14.14 6.3 546 FUFENG GROUP 297 1.95 31.48 6.2 867 CMS 8 0.07 1.12 6.1 363 SHANGHAI IND H 40 1.27 20.90 6.1 2601 CPIC 133 4.48 74.06 6.0 128 ENM HOLDINGS 36 0.03 0.44 6.0 732 TRULY INT'L 120 0.20 3.33 6.0 569 CH AUTOMATION 17 0.11 1.85 6.0 3 HK & CHINA GAS 81 1.54 27.13 5.7 19 SWIRE PACIFIC A 31 3.65 65.86 5.5 1899 XINGDA INT'L 36 0.31 5.68 5.4 3389 HENGDELI 140 0.67 12.37 5.4 941 CHINA MOBILE 348 25.12 473.33 5.3 813 SHIMAO PROPERTY 292 3.28 62.07 5.3 3308 GOLDEN EAGLE 145 3.03 57.68 5.3 1234 CHINA LILANG 14 0.16 3.00 5.3 506 CHINA FOODS 118 0.69 13.29 5.2 175 GEELY AUTO 1600 5.09 99.11 5.1 3800 GCL-POLY ENERGY 1527 7.29 143.00 5.1 525 GUANGSHEN RAIL 174 0.54 10.78 5.0 2362 JINCHUAN INTL 82 0.25 5.13 4.9 1833 INTIME 48 0.58 11.85 4.9 1880 BELLE INT'L 175 2.69 54.78 4.9 1136 TCC INT'L HOLD 130 0.56 11.39 4.9 1093 CHINA PHARMA 128 0.62 12.62 4.9 200 MELCO INT'L DEV 579 3.56 74.31 4.8 970 SPARKLE ROLL 96 0.14 2.96 4.7 297 SINOFERT 280 0.94 20.10 4.7 587 HUA HAN 96 0.24 5.23 4.6 1766 CSR 1253 11.18 242.79 4.6 494 LI & FUNG 182 7.10 154.35 4.6 857 PETROCHINA 2252 25.66 568.79 4.5 1988 MINSHENG BANK 600.50 4.46 100.67 4.4 590 LUK FOOK HOLD 56 1.59 36.01 4.4 694 BEIJING AIRPORT 170 0.67 15.60 4.3 3331 VINDA INT'L 15 0.13 3.01 4.3 285 BYD ELECTRONIC 37.50 0.18 4.32 4.1 1101 CH RONGSHENG 131.50 0.89 21.63 4.1 2868 BJ CAPITAL LAND 76 0.23 5.56 4.1 866 CHINA QINFA 70 0.32 7.81 4.0 20 WHEELOCK 32 1.00 24.89 4.0 902 HUANENG POWER 358 1.63 41.34 3.9 1788 GUOTAI JUNAN I 23 0.09 2.19 3.9 991 DATANG POWER 332 0.94 24.19 3.9 2899 ZIJIN MINING 262 1.65 43.18 3.8 1338 BAWANG GROUP 38 0.09 2.24 3.8 1211 BYD COMPANY 55.50 1.56 42.25 3.7 3818 CHINA DONGXIANG 171 0.43 11.72 3.7 303 VTECH HOLDINGS 0.90 0.08 2.15 3.7 2168 YINGDE GASES 46 0.32 8.71 3.7 448 HANG TEN GROUP 146 0.31 8.56 3.6 2342 COMBA 17.50 0.17 4.88 3.4 809 GLOBAL BIO-CHEM 1172 2.15 63.44 3.4 1838 CHINAPROPERTIES 6 0.01 0.43 3.4 2228 COSTIN NEW MAT 23 0.13 3.81 3.3 753 AIR CHINA 316 2.52 75.57 3.3 315 SMARTONE TELE 17.50 0.21 6.54 3.2 2318 PING AN 115 9.76 303.41 3.2 242 SHUN TAK HOLD 124 0.59 18.57 3.2 1863 SIJIA GROUP 78 0.30 9.79 3.1 17 NEW WORLD DEV 105 1.45 48.77 3.0 321 TEXWINCA HOLD 42 0.36 12.23 3.0 493 GOME 772 2.15 72.83 2.9 3888 KINGSOFT 56 0.27 9.19 2.9 743 ASIA CEMENT CH 65 0.37 12.99 2.8 2128 CHINA LIANSU 467 3.46 123.63 2.8 538 AJISEN (CHINA) 51 0.77 27.56 2.8 868 XINYI GLASS 212 1.79 64.58 2.8 210 DAPHNE INT'L 102 0.64 24.09 2.7 220 U-PRESID CHINA 4 0.02 0.66 2.6 893 CHINAVTM MINING 217 0.77 29.79 2.6 1052 GZI TRANSPORT 10 0.04 1.70 2.6 860 MING FUNG JEWEL 270 0.26 10.40 2.5 178 SA SA INT'L 76 0.35 14.05 2.5 746 L & M HOLDING 8 0.08 3.24 2.5 1698 BOSHIWA INT'L 65 0.38 15.64 2.4 171 SILVER GRANT 38 0.11 4.65 2.4 1122 QINGLING MOTORS 52 0.14 5.94 2.3 241 CITIC 21CN 36 0.04 1.58 2.3 1212 LIFESTYLE INT'L 16 0.33 14.25 2.3 1333 CHINA ZHONGWANG 128.80 0.52 22.64 2.3 995 ANHUIEXPRESSWAY 14 0.09 4.01 2.3 858 EXTRAWELL PHAR 40 0.03 1.18 2.2 981 SMIC 4171 2.65 119.23 2.2 2357 AVICHINA 852 4.00 181.31 2.2 1192 TITAN PETROCHEM 60 0.04 1.82 2.2 13 HUTCHISON 105 9.38 428.82 2.2 1053 CHONGQING IRON 12 0.02 1.11 2.2 1157 ZOOMLION 228.20 5.10 235.35 2.2 1777 FANTASIA 25.50 0.03 1.56 2.2 2356 DAHSING BANKING 10.80 0.13 6.23 2.1 3336 JU TENG INTL 80 0.22 10.11 2.1 1836 STELLA HOLDINGS 3 0.05 2.53 2.1 855 CHINA WATER 32 0.09 4.43 2.1 3339 LONKING 234 1.33 65.38 2.0 939 CCB 2725 19.64 976.14 2.0 751 SKYWORTHDIGITAL 198 0.99 50.26 2.0 906 COFCO PACKAGING 5 0.03 1.32 2.0 2727 SH ELECTRIC 102 0.43 22.11 1.9 54 HOPEWELL HOLD 4.50 0.10 5.47 1.9 34 KOWLOON DEV 7 0.07 3.98 1.8 3988 BANK OF CHINA 2586 11.10 618.31 1.8 1893 SINOMA 44 0.35 20.21 1.7 874 GUANGZHOU PHAR 10 0.10 5.81 1.7 384 CHINA GAS HOLD 362 1.24 77.06 1.6 555 REXLOT HOLDINGS 75 0.06 3.93 1.6 980 LIANHUA 2 0.07 4.37 1.6 2383 TOM GROUP 2 0.00 0.12 1.6 152 SHENZHEN INT'L 277.50 0.19 12.38 1.5 1313 CHINARES CEMENT 86 0.67 44.00 1.5 2778 CHAMPION REIT 30 0.14 9.29 1.5 6 POWER ASSETS 18 0.97 67.92 1.4 1021 MIDAS HOLDINGS 1 0.00 0.35 1.4 1398 ICBC 1517 9.79 732.98 1.3 976 CHIHO-TIANDE 60 0.40 29.91 1.3 517 COSCO INTL HOLD 30 0.15 12.37 1.2 2722 CHONGQING M&E 114 0.34 28.55 1.2 702 SINO OIL & GAS 685 0.25 21.20 1.2 848 MAOYE INT'L 9 0.04 3.00 1.2 2468 TRONY SOLAR 32 0.15 13.18 1.2 806 VALUE PARTNERS 6 0.05 4.08 1.1 2883 CHINA OILFIELD 92 1.47 132.88 1.1 1199 COSCO PACIFIC 48 0.77 70.03 1.1 3833 XINXIN MINING 7 0.03 3.09 1.1 3618 CQRC BANK 110 0.57 53.11 1.1 818 HI SUN TECH 27 0.07 6.68 1.0 626 PUBLIC FIN HOLD 2 0.01 0.94 1.0 846 MINGFA GROUP 4 0.01 1.02 1.0 999 I.T 40 0.26 26.28 1.0 1031 GOLDRESORTS-NEW 52 0.06 6.46 0.9 552 CHINACOMSERVICE 34 0.16 17.62 0.9 67 LUMENA 330 1.15 134.74 0.9 591 C HIGHPRECISION 10 0.06 6.58 0.9 183 RICHFIELD GP 24 0.02 2.31 0.8 1683 IMM 24.50 0.19 25.23 0.8 293 CATHAY PAC AIR 14 0.27 35.27 0.8 823 LINK REIT 10.50 0.25 33.53 0.8 268 KINGDEE INT'L 60 0.28 40.04 0.7 3983 CHINA BLUECHEM 34 0.22 34.30 0.7 257 CHINA EB INT'L 12 0.04 6.94 0.6 228 CHINA ENERGY 46 0.02 2.40 0.6 74 GREAT WALL TECH 6 0.02 4.29 0.6 850 PETROASIAN 32 0.01 2.56 0.6 3933 UNITED LAB 4 0.06 10.68 0.5 1618 MCC 16 0.05 10.41 0.5 1033 YIZHENG CHEM 46 0.16 31.68 0.5 724 SINO-TECH INT'L 270 0.05 9.83 0.5 886 SILVER BASE 11 0.07 14.74 0.5 182 CHINA WINDPOWER 30 0.02 5.11 0.5 449 CHIGO HOLDING 52 0.04 7.75 0.5 2233 WESTCHINACEMENT 92 0.33 72.78 0.5 606 CHINA AGRI 18 0.16 35.23 0.5 819 TIANNENG POWER 10 0.04 9.27 0.4 653 BONJOUR HOLD 28 0.04 9.19 0.4 1020 SINOREF HLDGS 60 0.10 24.89 0.4 1308 SITC 2 0.01 2.49 0.4 390 CHINA RAILWAY 41 0.18 49.83 0.4 1999 MAN WAH HLDGS 1.20 0.01 3.71 0.4 197 HENG TAI 135 0.14 42.94 0.3 1194 C PRECIOUSMETAL 6 0.01 3.00 0.3 338 SHANGHAI PECHEM 40 0.16 48.82 0.3 882 TIANJIN DEV 2 0.01 3.87 0.3 639 FUSHAN ENERGY 44 0.25 80.70 0.3 2800 TRACKER FUND 26 0.62 260.39 0.2 2626 HNC 14 0.05 20.36 0.2 757 SOLARGIGA 6 0.01 5.98 0.2 1878 SOUTHGOBI 0.10 0.01 4.57 0.2 691 SHANSHUI CEMENT 6 0.05 23.02 0.2 945 MANULIFE 0.70 0.09 45.59 0.2 769 CHINA RAREEARTH 16 0.05 29.69 0.2 548 SHENZHENEXPRESS 6 0.03 19.08 0.2 845 GLORIOUS PPT H 18 0.04 24.02 0.2 1205 CITIC RESOURCES 14 0.03 17.19 0.2 505 XINGYE COPPER 1 0.00 1.05 0.2 43 C.P. POKPHAND 2 0.00 1.38 0.1 82 VODONE 10 0.02 16.29 0.1 3998 BOSIDENG 16 0.04 29.11 0.1 233 MY MEDICARE 20 0.01 10.62 0.1 8 PCCW 10 0.03 24.14 0.1 931 ARTEL GROUP 5 0.00 1.11 0.1 1177 SINO BIOPHARM 8 0.02 17.65 0.1 389 TONTINE WINES 6 0.01 7.80 0.1 689 EPI (HOLDINGS) 100 0.01 4.81 0.1 910 CH GRAND FOREST 234 0.05 48.09 0.1 64 GET NICE 4 0.00 1.89 0.1 2888 STANCHART 0.15 0.03 30.60 0.1 1169 HAIER ELEC 4 0.04 41.16 0.1 1688 ALIBABA 5 0.07 75.72 0.1 877 O-NET COMM GP 2 0.01 11.41 0.1 633 CH ALL ACCESS 2 0.00 5.94 0.1 230 MINMETALS LAND 2 0.00 3.75 0.1 331 PCD STORES 4 0.01 11.13 0.1 368 SINOTRANS SHIP 0.50 0.00 2.18 0.1 2208 GOLDWIND 1 0.01 29.01 0.0 1828 DCH HOLDINGS 1 0.01 21.62 0.0 488 LAI SUN DEV 14 0.00 9.59 0.0 1186 CHINA RAIL CONS 0.50 0.00 32.39 0.0 Total No. of Securities recording Short Selling : 359 Total No. of Designated Securities recording Short Selling : 359 Short Selling Turnover Total Shares (SH) : 171,240,550 Short Selling Turnover Total Value ($) : HKD 2,386,820,425 *Total No. of non-Designated Securities recording Short Selling : 0 Short Selling Turnover Total Shares (SH) : 0 Short Selling Turnover Total Value ($) : HKD 0 Note: Figures are preliminary and subject to revision. -- Cheryl Yiu in Hong Kong 852-2977-6726 -0- Apr/19/2011 5:00 GMT

Bank Zachodni Says Polish May Rate Decision May Be ‘Close Call’

http://www.bloomberg.com/news/2011-04-19/bank-zachodni-says-polish-may-rate-decision-may-be-close-call-.html

Piotr Bujak, an economist at Bank Zachodni WBK in Warsaw, comments on Polish industrial output and producer price data, which were released today in Warsaw. Industrial output rose an annual 7 percent in March, the slowest rate since October 2009 and below the median estimate of 22 economists surveyed by Bloomberg for an increase of 9.6 percent. Producer prices increased by 9.3 percent in March from the year-earlier period, compared with a median estimate of 8.3 percent in a survey of 19 economists. “This is a pretty significant slowdown and we’ll have to expect further weakening in the output figures as the economies of our main trading partners slow. German growth is likely to be weaker, for example, which will hurt our exports. “The disappointing output figures will be an argument for Monetary Policy Council members who want to wait with the next rate increase. On the other hand, the producer price index was very strong, which could raise fears this will transfer to retail prices. The price pressures are an argument for the hawks in the central bank. “The May rate-setting meeting could be a very close call. I don’t expect a rate increase next month, though. The central bank won’t want to give the impression that it’s just reacting to current data.” To contact the reporter on this story: Katya Andrusz in Warsaw at kandrusz@bloomberg.net To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

Czech Parties Agree to Preserve Deficit-Cutting Government

http://www.bloomberg.com/news/2011-04-19/czech-parties-agree-to-preserve-deficit-cutting-government-1-.html

The Czech three-party coalition agreed on cabinet changes to resolve disputes that threatened to bring down the government and hamper planned deficit cuts. Radek John, interior minister and head of junior coalition partner Public Affairs, will become deputy premier for fighting corruption and will be replaced by Jan Kubice, Prime Minister Petr Necas told Czech public television today after a five-hour coalition meeting. The cabinet will send laws overhauling public spending to parliament by the end of June and will tie them to a confidence vote, said Necas, leader of the Civic Democrats. “We’ve reached a genuine agreement,” Foreign Minister Karel Schwarzenberg, the leader of Top09, told the broadcaster. “The prime minister and this agreement have a 100 percent support from Top09 and we are very happy that our government can continue in its reform efforts.” Coalition tensions increased earlier this month after Necas said he wanted to fire John and Education Minister Josef Dobes, also from Public Affairs, over their ties to a private detective agency. Necas’s pledge to overhaul the money-losing pension system and trim the fiscal gap below the European Union’s limit of 3 percent of economic output by 2013 has helped the koruna gain 7.2 percent against the euro since May 2010 elections. The koruna today gained as much as 0.4 percent to 24.091 per euro, its strongest intraday level in more than two months, and traded 0.3 percent firmer at 24.120 as of 2 p.m. in Prague. Necas said today he has changed his mind on Dobes and will let him keep his post. A parliamentary no-confidence motion proposed by the opposition Social Democrats last week has little chance of passing after the agreement, the prime minister said. To contact the reporter on this story: Krystof Chamonikolas in Prague at kchamonikola@bloomberg.net To contact the editor responsible for this story: Douglas Lytle at dlytle@bloomberg.net

Tunisian Court Acquits in Case Linked to Unrest, Lawyer Says

http://www.bloomberg.com/news/2011-04-19/tunisian-court-acquits-in-case-linked-to-unrest-lawyer-says.html

A Tunisian court acquitted a policewoman accused of attacking Mohamed Bouazizi, the street trader whose self-immolation inspired a revolution that toppled the country’s president, the woman’s lawyer said. Fadia Hamdi was accused of slapping and humiliating Bouazizi before he set himself on fire outside the governor’s office on Dec. 17. She denied the charges, her lawyer, Basma Mnassri, said. “I was convinced that my client is innocent and I asked for a fair trial,” Mnassri said today in a phone interview from Sidi Bouzid. “Fadia Hamdi is a living martyr.” TAP, the state- run news agency, said that the court threw out the charges after Bouazizi’s family dropped their complaint. Bouazizi, 26, who sold fruit and vegetables on a street in Sidi Bouzid, about 200 kilometers (125 miles) south of the capital, Tunis, was harassed and heckled by local police for not having a permit and his cart was confiscated. The protests triggered by his death culminated in Tunisian President Zine El Abidine Ben Ali’s Jan. 14 flight to Saudi Arabia and inspired a revolt in Egypt that led to the toppling of President Hosni Mubarak. The ruling comes as unrest inspired by the Tunisian uprising spreads throughout the Arab world, with protests rocking Yemen and Syria and armed conflict in Tunisia’s eastern neighbor, Libya. To contact the reporter on this story: Jihen Laghmari via the Cairo newsroom at jlaghmari@bloomberg.net To contact the editor responsible for this story: Mahmoud Kassem at mkassem1@bloomberg.net

Bank of America Said to Plan Spinoff of $5 Billion Private-Equity Business

http://www.bloomberg.com/news/2011-04-19/bofa-said-to-plan-spinoff-of-5-billion-private-equity-unit.html

Bank of America Corp. (BAC) , the biggest U.S. lender by assets, plans to wind down its flagship $5 billion buyout fund as it seeks to preserve capital, said a person with knowledge of the plan. The bank has made a “strategic decision” to sell most of the Capital Partners fund’s remaining investments over time, the person said, citing an internal memo sent late yesterday at the Charlotte , North Carolina-based company. The team managing those assets will become an independent firm, said the person, who declined to be identified because the plan isn’t public. Regulators are pressuring banks to build capital and reduce riskier assets ahead of new international regulations requiring greater reserves. The Federal Reserve rejected Bank of America’s request to increase its dividend last month, making it the only lender among the largest four that didn’t win approval. JPMorgan Chase & Co. (JPM) , the second-biggest U.S. bank by assets, has said it may continue making private equity investments. “Businesses in which they don’t have a leading market share are on the chopping block,” said Tony Plath , a finance professor at the University of North Carolina at Charlotte. “I’ll bet the private equity investments require an extra layer of capital under the new rules, so the returns probably don’t justify their use of capital.” The fund returned $2 billion to investors in the first quarter, and about $5 billion last year, the person said. Bank of America, which won’t fund new private equity investments through Capital Partners, still owns the assets and will pay fees to the spinoff firm, the person said. Most of the capital invested in the fund came from Bank of America, the person said. Strategically Critical The memo was sent from Jim Forbes, head of the bank’s global principal investments unit which includes the Capital Partners fund, said Jerry Dubrowski , a Bank of America spokesman who confirmed the contents of the letter. It is unclear if Forbes will remain, said the person. “We recently determined that private-equity investments were not strategically critical to our business going forward,” Dubrowski said. “With limited investment activity, it made sense for BAML Capital Partners to spin off from the bank.” The new firm will seek to raise funds, Dubrowski said. Most of Capital Partner’s assets were originally owned by Merrill Lynch, he said. To contact the reporters on this story: Hugh Son in New York at hson1@bloomberg.net ; Cristina Alesci in New York at calesci2@bloomberg.net To contact the editors responsible for this story: David Scheer at dscheer@bloomberg.net ; Rick Green at rgreen18@bloomberg.net

Madoff Investors’ Suit Claiming SEC Was Negligent in Oversight Dismissed

http://www.bloomberg.com/news/2011-04-19/madoff-investors-suit-claiming-sec-was-negligent-in-oversight-dismissed.html

Two of Bernard L. Madoff’s investors lost their bid to bring a $2.5 million suit against the U.S. Securities and Exchange Commission for allegedly gross negligent oversight in failing to uncover his fraudulent scheme. U.S. District Judge Laura Taylor Swain in New York today threw out the 2009 lawsuit by investors Phyllis Molchatsky and Steven Schneider which blamed the SEC for failing to detect and end the scheme. “Plaintiffs have identified no statutory or regulatory provision that suggests the existence of prescriptive rules for the conduct of SEC investigations,” Swain said in a 28-page ruling, adding “there is no reason to believe that information concerning any such duties would not be publicly available.” Swain has 27 similar cases, according to the court docket. “These lawsuits are not going to survive,” said Peter Henning , a professor at Wayne State University in Detroit and a former SEC lawyer. “The SEC did not cover itself in glory in the Madoff investigation, but it has discretion conducting its investigations.” Madoff, 72, is serving a 150-year sentence for running the fraud through his New York-based Bernard L. Madoff Investment Securities LLC. Investors lost about $17 billion of principal in the Ponzi scheme , according to the latest calculations of the trustee liquidating the Madoff firm, who reported the number in a court filing yesterday. Disappointed “We are disappointed with the judge’s opinion and continue to believe that the court is well-suited to oversee the SEC’s actions and inactions, which were inarguably negligent,” plaintiffs’ lawyer Howard Elisofon of New York-based Herrick Feinstein LLP said in an e-mailed statement. “We are reviewing this opinion and conferring with our clients before announcing our next step,” Elisofon said. Kevin Callahan , a spokesman for the SEC, declined to comment on the court’s ruling. “Scandalous and outrageous as plaintiffs’ allegations (and findings of the OIG Report on which they are based) are, plaintiffs fail to identify any specific mandatory duty that the SEC violated in its numerous instances of sloppy, uninformed, irresponsible behavior,” the judge wrote. Swain issued a separate order addressing plaintiffs and their lawyers in the 27 similar suits, directing them to file with the court by May 31 a statement outlining their positions “as to what further proceedings are appropriate,” in light of her ruling in the Molchatsky-Schneider case. Conference Scheduled The judge also scheduled a June 7 conference to discuss the issue with all sides. Proceedings in each of the cases are now stayed. Molchatsky, a disabled retiree and single mother who claims she lost $1.7 million in the fraud, and Schneider, a doctor who said he lost almost $753,000, filed the lawsuit under the Federal Tort Claims Act in October 2009 after the SEC denied their administrative claims. Their complaint relied for its underpinnings upon an August 2009 report by the SEC’s Office of the Inspector General which said the agency had received “numerous, detailed, credible complaints regarding Madoff” between 1992 and 2008, and “flawed” investigations, Swain said. The U.S. asked the court to dismiss the case, claiming the government is immune from suits and the SEC has discretion in deciding who to investigate and how to conduct its queries. The case is Molchatsky vs. U.S., 1:09-cv-08697, U.S. District Court, Southern District of New York ( Manhattan ). To contact the reporters on this story: Andrew Harris in Chicago at aharris16@bloomberg.net ; and Linda Sandler in New York at lsandler@bloomberg.net. To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net .

Rand Strengthens Versus Dollar on Speculation Borrowing Costs May Increase

http://www.bloomberg.com/news/2011-04-19/rand-gains-versus-dollar-euro-after-bank-says-food-poses-inflation-risks.html

The rand strengthened against the dollar after a central bank official said food prices posed “significant upside risks” for inflation, fuelling speculation the bank may raise borrowing costs as soon as July. The currency advanced as much as 0.8 percent to 6.8084 per dollar, and traded 0.5 percent stronger at 6.8284 as of 3:43 p.m. in Johannesburg. It was little changed at 9.7749 per euro after advancing as much as 0.6 percent to 9.7135 in earlier trading. Data show an “accelerating trend” in food prices, Reserve Bank Deputy Governor Daniel Mminele said in a speech in Washington on April 16, published on the Pretoria-based central bank’s website today. Second-round inflation, where increases in fuel and commodity prices drive up prices of other goods, would “need to be monitored very closely,” he said. The bank has left its benchmark repurchase rate at 5.5 percent, a 30-year low, since November. “The bank will not be soft on signs of second-round pressures, and will start a process of normalizing the repo rate in the third quarter,” Johannesburg-based Citibank NA analysts Leon Myburgh and Coura Fall wrote in a research note. The Pretoria-based government statistics agency will report tomorrow that the consumer price index in Africa ’s biggest economy probably rose 4 percent in March from a year earlier, compared with 3.7 percent in February, according to the median estimate of 21 economists surveyed by Bloomberg. The rate may increase to close to the upper limit of the central bank’s 3 to 6 percent target range, Myburgh and Fall wrote. Higher interest rates would increase the carry-trade appeal of rand assets. In the carry trade, investors borrow in the currency of nations with relatively low interest rates, and invest the proceeds in high-yielding assets. The rand pared earlier gains against the euro after a report showed German manufacturing growth unexpectedly accelerated, adding to speculation that the European Central bank will raise interest rates further. The euro gained against the dollar and yen after the report. Bonds rallied. The 13.5 percent notes due 2015 added 15 cents to 121.25 rand, cutting the yield five basis points, or 0.05 percentage point, to 7.69 percent. The 6.75 percent bonds due 2021 gained 24 cents to 88.22 rand, driving the yield 4 basis points lower to 8.53 percent. To contact the reporter on this story: Robert Brand in Cape Town at rbrand9@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

Nigeria Elections, Crude Price Savings ‘Promising’ for Rating, Fitch Says

http://www.bloomberg.com/news/2011-04-19/nigeria-elections-crude-price-savings-promising-for-rating-fitch-says.html

Nigeria ’s presidential elections and an increase in oil savings are “promising” for the credit profile of Africa’s biggest oil producer, according to Fitch Ratings. “The credible elections are a real positive for Nigeria, their news about the excess crude account building up is encouraging,” Veronica Kalema , a London-based director in Fitch’s sovereign group, said in a phone interview today. “We would now need to see what the new government would do in implementing some reforms, which would shield the excess crude account from election cycles and would reform the sovereign- wealth fund.” Fitch lowered its outlook on Nigeria’s BB- rating to “negative” from “stable” on Oct. 22, due to concerns that the nation was making withdrawals from the excess crude account, a windfall saved when the price of crude goes above the benchmark used for the country’s budget, and foreign-currency reserves dropped. The nation’s oil account rose to $6.9 billion in March from $3 billion in December, ThisDay newspaper reported April 12, citing acting Accountant-General Aderemi Ogunsanya. The West African nation depends on oil exports for 95 percent of foreign-exchange income, which provided $59 billion of revenue last year. Incumbent leader Goodluck Jonathan won presidential elections in Africa ’s most populous country this weekend, described as “credible” by observers from the Commonwealth group of nations. The last elections, in 2007, were seen by international and local monitors as flawed by intimidation of voters and ballot fraud. Rating Visit “We’re due to do a ratings visit around August, by then they will have had enough time to start implementing reforms,” said Kalema. “Then we will see what to do.” Nigeria’s Eurobonds due 2021, rated three levels below investment grade by Fitch, rose for a third day, gaining 0.3 percent to 103.19 cents on the dollar as of 11:34 a.m. in London, the highest level since the debt was issued in January, according to data compiled by Bloomberg. The yield fell four basis points, or 0.04 percentage point, to 6.31 percent. The $500 million of bonds are Nigeria’s only international notes. To contact the reporter on this story: Chris Kay in London at ckay5@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

Yen Erases Advance on Speculation Importers Sold Currency; Aussie Declines

http://www.bloomberg.com/news/2011-04-19/yen-erases-advance-on-speculation-importers-sold-currency-aussie-declines.html

The yen erased gains versus the dollar and the euro on speculation Japanese importers sold their nation’s currency after it rose for the past three days. The yen lost its earlier advance when it strengthened toward 82 per dollar, a level the currency reached after the Group of Seven nations jointly intervened in the foreign- exchange market last month. The Australian and New Zealand dollars weakened as losses in commodities and stocks damped demand for higher-yielding assets. “Importers were probably glad to see the yen climb back to this level,” said Takashi Kudo, senior manager of the foreign-exchange division support center in Tokyo at NTT SmartTrade Inc., a unit of Japan’s biggest telephone company. “Traders are paying attention to 82 yen” due to the G-7 intervention, he said. The yen traded at 82.56 per dollar as of 10:05 a.m. in Tokyo from 82.66 in New York yesterday, when it rose to 82.19, the strongest since March 29. The yen weakened to 81.99 per dollar when the intervention took place on March 18 from a postwar high of 76.25 the previous day. Japan ’s currency was at 117.56 per euro from 117.66. The dollar bought $1.4242 per euro from $1.4235. Australia ’s dollar fell 0.2 percent to $1.0489, and New Zealand’s dollar fell 0.4 percent to 78.78 U.S. cents. To contact the reporters on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net ; Candice Zachariahs in Sydney at czachariahs2@bloomberg.net To contact the editor responsible for this story: Rocky Swift at rswift5@bloomberg.net

Sprint Agrees to Pay Clearwire $1 Billion for Use of Network

http://www.bloomberg.com/news/2011-04-19/sprint-clearwire-report-amendments-to-long-term-agreement.html

Sprint Nextel Corp. (S) , the third- largest U.S. wireless provider, agreed to pay Clearwire Corp. (CLWR) at least $1 billion for the use of its so-called fourth-generation network over the next two years. Clearwire will get $300 million this year, $550 million in 2012, as well as pre-payments of $175 million over at least the next two years, according to a statement from the companies today. The agreement, which amends an existing deal, is good through November 2013. Sprint, which is based in Overland Park , Kansas , can keep offering wireless service that allows speedier Web browsing and video streaming than its own network, according to the agreement. For unprofitable Clearwire, the accord may provide less funding than some investors had expected, said Michael Nelson , a Mizuho Securities analyst in New York. “Clearwire investors would like to see Clearwire receive enough capital to resume full expansion of its network, and to do that, they need roughly $2 billion,” Nelson, who rates both Sprint and Clearwire shares “buy,” said in an interview. “Clearwire investors were hoping for a discrete equity investment from Sprint into Clearwire.” Clearwire, based in Kirkland, Washington , fell 25 cents, or 4.3 percent, to $5.53 at 4 p.m. New York time on the Nasdaq Stock Market. Sprint added 4 cents to $4.74 in New York Stock Exchange composite trading. ‘Positive Step’ Sprint also agreed to new terms for prices based on usage of handsets, such as the Evo 4G. The carrier will be allowed to resell the 4G service, operating on a technology known as WiMax, to other carriers, the companies said. The deal resolves a disagreement over how much Clearwire could charge Sprint for use of its service, a dispute that emerged after Sprint began selling smartphones for the fourth- generation network in 2010. That disagreement may have discouraged some potential investors in Clearwire, Chief Financial Officer Erik Prusch said in March. “This is an enormous positive step towards achieving positive cash flow ” during 2012, said Clearwire interim Chief Executive Officer John Stanton in an interview. “Anything that would bring us closer to Sprint is a good thing.” Stanton said Sprint’s agreement to use Clearwire’s WiMax service is set to be automatically extended for another five year period after November 2013, though the terms may change through further negotiation. Financing Needs Clearwire is conducting a search for a new CEO after Bill Morrow stepped down from the post last month. Stanton said he had no interest in remaining as full-time CEO and would like to continue as non-executive chairman. In February, Clearwire predicted improving earnings that could eliminate the need for additional financing. The company had struggled to meet its funding needs, telling investors in November it could run out of cash by midyear before raising $1.3 billion in bonds in December. The company, which reported a $487.4 million net loss last year, has also slowed down its network expansion, cut sales and marketing spending and fired employees to save money. Sprint trails Verizon Wireless , the largest U.S. wireless provider, and AT&T Inc. (T) , the No. 2. To contact the reporters on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net ; Amy Thomson in New York at athomson6@bloomberg.net To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net

Saudi Airlines Passengers Numbers Rise 8.9% as Fleet Expands

http://www.bloomberg.com/news/2011-04-19/saudi-airlines-passengers-numbers-rise-8-9-as-fleet-expands.html

Saudi Arabian Airlines said passenger numbers rose 8.9 percent in the first quarter after increasing the size of its fleet and adding more flights. The kingdom’s national carrier, based in Jeddah, Saudi Arabia , said in a statement today that it carried 4.54 million passengers in the first quarter compared with 4.17 million for the same period a year earlier. The airline is planning to add more than the 70 planes it already has on order from Boeing Co. (BA) and Airbus SAS as it seeks to replace older Boeing models to reduce maintenance costs, Khalid al-Molhem, the airline’s director general, said in an interview last May. The carrier said yesterday that 44 new airplanes entered service in the last 17 months with another five due by the end of this year. SAA will keep adding planes until the end of 2014 when it should have acquired all 70 of the new airplanes on order, al-Molhem added. To contact the reporter on this story: Wael Mahdi in Jeddah wmahdi@bloomberg.net. To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net

French Rapeseed Crop Lacks Water in Central Region, Cetiom Says

http://www.bloomberg.com/news/2011-04-19/french-rapeseed-crop-lacks-water-in-central-region-cetiom-says.html

French rapeseed in the country’s central growing region, which accounts for about a fifth of national production, is lacking water, France ’s technical center for oilseed crops said. Near the city of Tours in France’s Centre region, water requirements of the rapeseed crop surpassed the available moisture in the first 10 days of April, the Paris-based center, known as Cetiom, said in a report on its website today. Northern France has built up an “important” water-supply deficit since the end of January, while maximum temperatures have been at the “upper limit” of the normal range for the season, the European Union’s Monitoring Agricultural Resources unit said in a report dated April 12. “The season is relatively early compared with other years due to the high temperatures,” Cetiom said. “The dry conditions persist and there’s no change announced for the coming days. The soils therefore are dry.” Rapeseed in the Centre and Ile-de-France regions and the Eure department in Haute-Normandie has “mostly” entered the growing stage in which plants start to drop their flower petals, the center said. The Centre region accounts for about 15 percent of France’s rapeseed production, while the Ile-de-France region produces another 4 percent of the country’s crop, according to data from the U.S. Department of Agriculture. To contact the reporter on this story: Rudy Ruitenberg in Paris at rruitenberg@bloomberg.net To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net

HSBC Hires Economist Delgado From Roubini Global

http://www.bloomberg.com/news/2011-04-19/hsbc-hires-roubini-global-s-delgado-as-emerging-market-cross-asset-analyst.html

HSBC Holdings Plc. (HSBA) , Europe’s largest bank by market value, hired Bertrand Delgado as an emerging-markets strategist, luring him away from Roubini Global Economics LLC. Delgado, 43, is working in New York as a cross-asset strategist for emerging markets, said Rob Sherman, an HSBC spokesman. Delgado, who started at HSBC on April 11, reports to Pablo Goldberg, head of global emerging markets research for HSBC Global Banking and Markets. Roubini Global Economics, a consulting firm founded by Nouriel Roubini, the New York University economist who predicted the global financial crisis, hired Delgado in 2009 as a senior economist covering emerging markets. Delgado previously served as an economist and currency strategist at the research firm IDEAglobal for three years. He holds a bachelor’s degree in economics from University of Wisconsin and a master’s degree in international finance and economics from Columbia University. Emerging markets from Asia to Latin America accounted for most of HSBC’s net income last year. Pretax profit in Asia jumped 26 percent to $11.6 billion in 2010, compared with the 7.3 percent increase to $4.3 billion in Europe, HSBC said in February. To contact the reporter on this story: Ye Xie in New York at yxie6@bloomberg.net To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

Novolipetsk Jumps Most in 2 Months as 1st-Quarter Sales Gain

http://www.bloomberg.com/news/2011-04-19/novolipetsk-jumps-most-in-2-months-as-1st-quarter-sales-gain-1-.html

OAO Novolipetsk Steel, owned by Russian billionaire Vladimir Lisin , rose the most in almost two months in Moscow after saying its preliminary results show an advance in first-quarter sales. The shares climbed 3.2 percent to 109.48 rubles at the 6:45 p.m. close in Moscow, the biggest jump since Feb. 25. Sales are expected at $2.4 billion for the first quarter, up 41 percent from $1.7 billion a year earlier, the company said in a statement today. “We expect sequential growth in second-quarter sales volumes as market conditions improve,” the company said. To contact the reporter on this story: Jack Jordan in London at jjordan22@bloomberg.net To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

Capmark Financial Group Files Plan to Exit Bankruptcy as Smaller Company

http://www.bloomberg.com/news/2011-04-19/capmark-financial-group-files-plan-to-exit-bankruptcy-as-smaller-company.html

Capmark Financial Group Inc., the bankrupt commercial lender, filed a plan to reorganize around a group of 14 units, including its bank, and exit bankruptcy as a smaller company. Capmark Bank, based in Midvale, Utah , had $6.2 billion in deposits and $3.1 billion in cash as of Dec. 31, according to court documents the company filed April 15 in U.S. Bankruptcy Court in Wilmington, Delaware, as part of its reorganization plan. The reorganized company will issue $1.25 billion in notes to general unsecured creditors who are owed about $7 billion. Creditors will also be given stock in the new company and some cash. After the assets have been given out, the biggest group of creditors, those who hold unsecured loans and notes not guaranteed by collateral, will recover about $3.89 billion, or 56.1 percent of what they are owed, according to the plan. Capmark Financial, based in Horsham, Pennsylvania , urged creditors to support the plan. “Any alternative to confirmation of the plan would result in significant delays, litigation, lost value and additional costs,” the company said in a disclosure statement describing how the plan will affect creditors. The company asked U.S. Bankruptcy Judge Christopher Sontchi to approve the disclosure statement, so it can be sent to creditors to help them vote on the plan. Once creditors vote, Sontchi will decide whether to approve the reorganization and allow Capmark to leave court protection. Capmark filed bankruptcy on Oct. 25, 2009, blaming falling property values and a drop in lending. While in bankruptcy, the company sold its loan-servicing unit to Warren Buffett ’s Berkshire Hathaway Inc. and Leucadia National Corp. (LUK) in a deal valued at $468 million. The case is In re Capmark Financial Group Inc., 09-13684, U.S. Bankruptcy Court, District of Delaware (Wilmington). To contact the reporter on this story: Steven Church in U.S. Bankruptcy Court in Wilmington, Delaware, at schurch3@bloomberg.net To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net

Stocks Gain on Earnings as Gold Futures Rise Above $1,500 on Weaker Dollar

http://www.bloomberg.com/news/2011-04-19/asian-stocks-decline-as-won-kiwi-drop-after-s-p-cuts-u-s-rating-outlook.html

Stocks rebounded from the biggest drop in a month after companies from Johnson & Johnson (JNJ) to Burberry Group Plc. (BRBY) reported results that beat analyst estimates. Gold futures touched $1,500 an ounce for the first time as the dollar weakened. Treasuries rose. The Standard & Poor’s 500 Index advanced 0.6 percent to 1,312.62 at 4 p.m. in New York as higher-than-forecast housing starts also drove gains. The Stoxx Europe 600 Index increased 0.5 percent as Burberry rallied 6 percent. The euro climbed 0.7 percent to $1.4332. Canada’s dollar strengthened versus 14 of 16 major peers as accelerating inflation triggered bets the central bank will boost interest rates. Johnson & Johnson, the world’s second-biggest seller of health-care products, led gains in the Dow Jones Industrial Average after increasing its full-year forecast. Burberry, Britain’s biggest luxury retailer, said quarterly sales jumped 32 percent and SKF AB (SKFB) , the world’s largest maker of ball bearings, posted record profit. Stocks slid yesterday as S&P cut the long-term U.S. credit outlook to negative. “This market has been very resilient,” said Burt White, who helps oversee $284 billion as chief investment officer at LPL Financial Corp. in Boston. “Things are better than people think as far as the economy goes. Today’s housing numbers were pretty good. You’ve got a bellwether such as Johnson & Johnson coming out with good news. The market is excited to see that.” Earnings Season The S&P 500 rebounded after yesterday dropping 1.1 percent, the most since March 16. J&J climbed 3.7 percent after new drugs and a weaker dollar boosted results. Steel Dynamics Inc. added 5.7 percent as its profit also beat projections. Newmont Mining Corp. helped pace gains in raw-material producers, rising 1.3 percent as gold and copper prices increased. Goldman Sachs Group Inc. (GS) rallied as much as 1.5 percent after earnings topped estimates, before erasing gains and retreating 1.3 percent after Rochdale Securities LLC reduced its rating to “neutral” from “buy.” About 6.6 billion shares changed hands on U.S. exchanges, 15 percent less than the three-month average as trading slowed on the Passover holiday. A gauge of homebuilders in S&P indexes gained 2.2 percent as all 12 of its stocks advanced. A report today showed building permits, a proxy for future construction, rose 11 percent to a 594,000 pace. They were projected to rise 1.1 percent to a 540,000 annual pace. Housing starts increased 7.2 percent to 549,000, exceeding the 520,000 median forecast of economists surveyed by Bloomberg News. About three shares gained for each that fell in the Stoxx 600. SKF rallied 6.4 percent. LVMH Moet Hennessy Louis Vuitton SA (MC) , the world’s largest luxury-goods maker, advanced 4.7 percent as sales beat analysts’ estimates. Novartis AG (NOVN) , the third- biggest stock in the index, gained 3.5 percent after the drugmaker’s sales and profit surpassed projections. AAA Rating The yield on the 10-year U.S. Treasury note slipped two basis points to 3.36 percent and the 30-year yield lost three basis points to 4.43 percent. President Barack Obama began a tour promoting his proposal to cut long-term budget deficits with a new urgency after S&P said yesterday that the nation’s AAA credit rating is in peril. The divide between Republicans and Democrats in Congress over combating the nation’s debt was spotlighted by S&P’s lowering of the long-term U.S. credit outlook to “negative,” with each side saying the alert bolsters their competing arguments. Treasury Secretary Timothy F. Geithner said he’s confident U.S. political leaders will bridge their differences and move toward a long-term plan to narrow record budget deficits and reduce the debt. ‘Strong Targets’ “We have an opportunity now over the next two months to make some real progress,” Geithner said in an interview on Bloomberg Television today. “What we agree on is putting in place strong targets for savings, deficit reduction over a specific time frame with enforceable limits,” he said. Gold for June delivery settled up 0.1 percent at $1.495.10 after earlier reaching $1,500.50. The dollar weakened against 12 of 16 major peers, losing at least 1 percent versus Norway’s krone and Sweden’s krona. The euro appreciated against 11 of its 16 major counterparts amid speculation the European Central Bank will raise interest rates further. The loonie, as the Canadian currency is nicknamed, strengthened 0.8 percent to $1.0455 after the consumer price index advanced 3.3 percent in March from a year earlier, compared with a 2.2 percent pace of increase in the previous month, Statistics Canada reported. The median forecast of 25 economists was for a 2.8 percent annual rate. Commodities Gain Crude oil for May delivery increased for the fourth time in five days, rallying 1 percent to $108.15 a barrel as the weaker dollar lifted commodities. Oil traders have turned $80 crude into the second-biggest bet in the options market as a surge in futures to the highest level since 2008 spurred concern that demand may tumble. Open interest, the number of contracts held by traders, has more than doubled since January for $80 put options for December 2011 and 2012 as New York futures last week touched a 30-month high of $113.46 a barrel. The two puts, bets that prices will fall, account for 21 percent of the open interest among the top 10 contracts traded on the New York Mercantile Exchange. Commodities, Emerging Markets The S&P GSCI index of 24 commodities gained 0.3 percent, recouping some of yesterday’s 1.2 percent slide. Cotton retreated 3.9 percent. Wheat futures rose 1.3 percent, a third straight gain, as weather conditions in the U.S. worsened and Germany ’s crop estimate was lowered amid a dry spell. The MSCI Emerging Markets Index increased 0.6 percent as benchmark gauges in Russia , Turkey, South Africa , Egypt and Hungary rallied more than 1 percent. The Shanghai Composite Index led declines in Asia , sliding 1.9 percent, on concern the U.S. debt outlook may deteriorate further and speculation that China will further tighten monetary policy. The MSCI Asia Pacific Index lost 1 percent to the lowest level this month as S&P’s downgrade of the U.S. credit outlook fueled concern that a recovery in the global economy may slow. Greece’s two-year yields jumped as much as 39 basis points to a record 20.73 percent as the government sold 1.625 billion euros ($2.33 billion) of bills. To contact the reporters on this story: Stephen Kirkland in London at skirkland@bloomberg.net ; Rita Nazareth in Sao Paulo at rnazareth@bloomberg.net. To contact the editor responsible for this story: Michael Regan at mregan12@bloomberg.net

Singapore to Hold Elections on May 7 as Premier Lee Dissolves Parliament

http://www.bloomberg.com/news/2011-04-19/singapore-to-hold-elections-on-may-7-as-premier-lee-dissolves-parliament.html

Singapore will hold its parliamentary election on May 7, according to a statement from the Prime Minister’s Office. To contact the reporter on this story: Shamim Adam in Singapore at sadam2@bloomberg.net To contact the editor responsible for this story: Linus Chua at lchua@bloomberg.net

Fed Seeks Public Comment on Proposed Rule on Mortgage Lending

http://www.bloomberg.com/news/2011-04-19/fed-seeks-public-comment-on-proposed-rule-on-mortgage-lending.html

The Federal Reserve today requested public comment on a proposed rule that would require lenders to determine a consumer’s ability to repay a mortgage before making the loan. The rule would also establish minimum mortgage underwriting standards, the central bank said in a statement in Washington today. The Fed said it will accept comments until July 22. To contact the reporter on this story: Christopher Wellisz at cwellisz@bloomberg.net To contact the editor responsible for this story: Christopher Wellisz at cwellisz@bloomberg.net

Fekter To Be Named Austrian Finance Minister Today, ORF Reports

http://www.bloomberg.com/news/2011-04-19/fekter-to-be-named-austrian-finance-minister-today-orf-reports.html

April 19 (Bloomberg) --Maria Fekter will be named as Austria ’s new finance minister after a meeting of the co- governing People’s Party today, Austria’s state broadcaster ORF reported, without saying where it got the information. New party chairmanMichael Spindeleggerwill also name Beatrix Karl justice minister and Johanna Mikl-Leitner interior minister at a news conference following the meeting, ORF said. To contact the editor responsible for this story: Boris Groendahl at bgroendahl@bloomberg.net

Marathon Reports Unit Upset at Robinson, Illinois, Refinery

http://www.bloomberg.com/news/2011-04-19/marathon-reports-unit-upset-at-robinson-illinois-refinery-1-.html

Marathon Oil Corp. (MRO) reported a unit upset at its Robinson refinery in Illinois yesterday, according to a filing with state regulators. The upset was caused by an incorrect setting on a pressure controller for a wet gas compressor at the fluid catalytic cracker, according to the filing with the Illinois Emergency Management Agency. Shane Pochard, a spokesman for Marathon, declined to comment. The 215,000-barrel-a-day refinery, which is located in southeastern Illinois, processes sweet and sour crudes, according to a company filing. The plant delivers refined products to terminals in Chicago via the Wabash pipeline system. To contact the reporter on this story: Aaron Clark in New York at aclark27@bloomberg.net To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

Malaysia Stocks: CapitaMalls, Ken Holdings, Karambunai, Zhulian

http://www.bloomberg.com/news/2011-04-19/malaysia-stocks-capitamalls-ep-manufacturing-ken-zhulian.html

Shares of the following companies had unusual moves in Malaysia trading. Stock symbols are in parentheses and prices are as of the 5 p.m. close in Kuala Lumpur. The FTSE Bursa Malaysia KLCI (FBMKLCI) Index fell 6.39, or 0.4 percent, to 1,521.53, its lowest close since March 29. CapitaMalls Malaysia Trust (CMMT) , a retail property trust, added 0.9 percent to 1.13 ringgit, the most since April 11, after reporting a profit of 31.4 million ringgit ($10.4 million) in the first quarter ended March 31. The company achieved a distributable income of 26 million ringgit, it said in a statement. There were no comparable year-earlier figures as the company was established in June 2010, it said. EP Manufacturing Bhd. (EPMB) jumped 10 percent to 74.5 sen, the highest close since March 2006. Horizon Growth Fund NV has emerged as a substantial shareholder of the Malaysian auto- parts maker after buying 8.7 million shares, or a 5.4 percent stake, an exchange filing showed. Karambunai Corp. (KRBN MK), a property and hotel group, surged 21 percent to 25.5 sen, the most since Jan. 4, after Malaysia’s government said the company is part of a group that will undertake a 9.6 billion-ringgit integrated resort development in Sabah state. Ken Holdings Bhd. (KEN) , a property developer, surged 13 percent to 1.35 ringgit, its highest close since July 31, 2007. The company’s first-quarter profit surged fourfold from a year earlier to 5.08 million ringgit on higher sales, according to a stock exchange filing. Zhulian Corp. (ZHCB MK), a multi-level marketing company , lost 1.7 percent to 1.75 ringgit, its lowest close since April 12. First-quarter net income fell 14 percent from a year earlier to 21.3 million ringgit because of lower profit margins, Zhulian said in a statement. To contact the reporters on this story: Chan Tien Hin in Kuala Lumpur at thchan@bloomberg.net To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net

Manchester United Misses Chance to Take Nine-Point Lead in Premier League

http://www.bloomberg.com/news/2011-04-19/manchester-united-draws-0-0-at-newcastle-leads-premier-league-by-7-points.html

Manchester United missed the chance to take a nine-point lead atop English soccer’s Premier League with a 0-0 draw at mid-table Newcastle. Ryan Giggs twice shot wide for the Red Devils in the second half at St. James’ Park last night, while both teams had appeals for penalty kicks rejected. The draw leaves United, seeking a record 19th English league title, seven points ahead of second-place Arsenal with five matches remaining. Arsenal has played one game fewer and can cut the gap to four by beating London rival Tottenham today. “I’m confident we’ll be fine now as that was a hard one to get over,” United manager Alex Ferguson told Sky Sports. “We’re in a better position than we were on Saturday -- one less game and the same position we were with Arsenal with five games left.” Defending champion Chelsea trails United by nine points and can reduce the deficit with a win against Birmingham in today’s other Premier League match, the first of three straight at home for the Blues. Ferguson’s team visits Arsenal on May 1 and hosts Chelsea a week later. “You have got to look at Chelsea also and how they respond with the three home games in a row,” Ferguson said. “There are two important games coming up, obviously, and that’s the Arsenal game away and the Chelsea game at home.” Arsenal’s draw with Liverpool three days ago gave United the chance to go nine points clear with a win last night. The Red Devils failed to convert any of their eight chances on target. Early Chance Newcastle goalkeeper Tim Krul made a point-blank save from Javier Hernandez in the second minute and Wayne Rooney shot over the crossbar after being sent clear by Hernandez’s flick. Jose Enrique denied Hernandez with a block on the stroke of halftime. Referee Lee Probert waved away Newcastle’s appeals for a penalty kick in the 60th minute when United midfielder Anderson appeared to catch Peter Lovenkrands in the area. Giggs twice skewed shots wide from goal-scoring positions before United had a claim for a penalty kick of its own rejected in the second minute of injury time. Hernandez went down under Danny Simpson’s challenge and Probert showed the Mexican striker a yellow card for diving instead of awarding a spot kick. “If it’s not a penalty, fine, but to book him is an insult,” Ferguson said. “There is definitely contact, no doubt about that.” Newcastle manager Alan Pardew, whose team moved up one place to ninth, said his “heart sank” as the referee blew his whistle because he’d assumed that a penalty had been given. “The history of Manchester United -- last-minute goals, the club that they are, the manager that they have, I honestly thought the referee had given it,” Pardew told Sky Sports. “The referee got the decision right and we got, in my opinion, a deserved draw.” To contact the reporter on this story: Dan Baynes in Sydney at dbaynes@bloomberg.net To contact the editor responsible for this story: Christopher Elser at at celser@bloomberg.net

Steel Dynamics Rises as First-Quarter Profit Tops Estimates

http://www.bloomberg.com/news/2011-04-19/steel-dynamics-climbs-after-first-quarter-profit-beats-estimates.html

Steel Dynamics Inc. (STLD) , a recycler of steel scrap, climbed to the highest level in 10 months in Nasdaq trading after reporting first-quarter profit that topped analysts’ estimates. Net income rose 59 percent to 46 cents a share from 29 cents a year earlier, the Fort Wayne , Indiana-based company said in a statement after the close of regular trading yesterday. That beat the 41-cent average of eight analyst estimates in a Bloomberg survey. Steel shipments climbed 4 percent to 1.5 million tons. Steel Dynamics is “optimistic” about 2011 and expects higher steel use in industries including energy and transportation, Chairman and Chief Executive Officer Keith Busse said in the statement. Margins at the company’s steel division increased to $132 a ton, said Michelle Applebaum , managing partner at Steel Market Intelligence, a Chicago-based industry consultant. “Steel Dynamics remains our top pick in the sector,” Applebaum said in a note. Net income climbed 63 percent to $105.9 million from $65 million and sales gained 30 percent to $2.02 billion. The shares rose $1, or 5.7 percent, to $18.46 at 4 p.m. New York time in Nasdaq Stock Market trading, the biggest intraday gain since June 2. To contact the reporter on this story: Sonja Elmquist in New York at selmquist1@bloomberg.net To contact the editor responsible for this story: Simon Casey at scasey4@bloomberg.net

J&J Raises Full-Year Profit Forecast After Weaker Dollar Boosts Sales

http://www.bloomberg.com/news/2011-04-19/johnson-johnson-profit-falls-23-amid-recalls-of-drugs-artificial-hips.html

Johnson & Johnson (JNJ) , the world’s second-biggest seller of health products, increased its annual earnings forecast after quarterly profit beat estimates on drug sales and a weak dollar. The shares rose the most since 2008. Earnings in 2011 will be $4.90 to $5 a share, above a January forecast of $4.80 to $4.90, New Brunswick , New Jersey- based J&J said in a statement today. Chief Financial Officer Dominic Caruso said he saw signs that a drop-off in medical procedures that hurt sales last year may be easing. Revenue concerns are part of the motivation behind J&J’s takeover talks with Synthes Inc. (SYST) , a Swiss medical-device maker, said Jeff Jonas , a Gabelli & Co. analyst in Rye, New York. While consumer-product sales fell after the company pulled more than 40 brands, prescription drugs beat estimates for the quarter, he said. A stronger flu season helped, as did new medicines for psoriasis and arthritis, Jonas said. “The story’s been delayed for a year and half because of all the consumer recalls, but they do have a good drug pipeline,” Jonas said in a telephone interview. “You could potentially see accelerating revenue as they launch their new drugs and recover on the consumer line.” Shares Rise Johnson & Johnson gained $2.23, or 3.7 percent, to $62.69 at 4 p.m. in New York Stock Exchange composite trading, making it the best performer in the Dow Jones Industrial Average. It was the biggest one-day increase since November 2008 for J&J, which has fallen 5.1 percent in the past 12 months. Quarterly profit excluding one-time items of $1.35 topped by 10 cents the average estimate of 16 analysts. Net income dropped 23 percent to $3.48 billion, or $1.25 a share, hurt by withdrawals of over-the-counter drugs and artificial hips. Revenue rose 3.5 percent to $16.2 billion. About half of the increase came from translating foreign currencies into dollars, the company said. “The market will probably like this, although currency was 49 percent of their growth so it’s not as rosy as the first read will make it look,” said David Maris, a Credit Agricole analyst in New York, in a telephone interview. J&J’s McNeil Consumer Healthcare unit pulled Tylenol, Motrin and other consumer medicines last year because of incorrect ingredients or a musty smell that sickened some customers. The company doesn’t expect to get all of the products back to the market until 2012, CFO Caruso said on a conference call with analysts. Recall Costs Caruso said fixing the quality problems will cut earnings this year by 12 cents a share, double January’s estimate, after J&J signed a consent decree in March giving U.S. regulators expanded oversight of three manufacturing plants. First-quarter sales of J&J’s over-the-counter drugs fell 6.5 percent, led by a 27 percent drop in the U.S., because of the recalls. Investors “are concerned about this damaging the reputation of J&J,” said Linda Bannister , an analyst at Edward Jones & Co. in St. Louis. “The company needs to make it right, to get these things fixed.” Synthes, which leads the $5.5 billion global market for tools to treat broken bones, said in a statement yesterday that it was in talks about being acquired by J&J. With a market value of $19.5 billion, the West Chester , Pennsylvania-based device maker would be J&J’s biggest takeover ever. Caruso declined to comment on any potential deal. J&J’s priority for using its approximately $27 billion in cash and near-term investments remains raising the dividend, he said. After that, the company wants “to grow the business.” Increasing Scale “We’re the largest med-tech business in the world, so we believe that having a broad base of med-tech businesses, of scale, is important,” Caruso said. “And obviously where we don’t have sufficient scale, we’d love to increase the scale over time in the appropriate manner.” Pharmaceutical division sales climbed 7.5 percent to $6.06 billion, J&J said. Revenue for psoriasis drug Stelara rose 91 percent to $166 million, while arthritis treatment Simponi’s sales climbed 36 percent to $53 million. Sales of Levaquin, an antibiotic, jumped 17 percent to $434 million because of a higher incidence of flu and respiratory illness, the company said. Pfizer Inc. (PFE) , based in New York, is the largest health products maker by annual sales. To contact the reporter on this story: Alex Nussbaum in New York anussbaum1@bloomberg.net. To contact the editor responsible for this story: Reg Gale at Rgale5@bloomberg.net

Oil, Gas Shipments Rose 9% Last Quarter at French Marseille Port

http://www.bloomberg.com/news/2011-04-19/oil-gas-shipments-rose-9-last-quarter-at-french-marseille-port.html

Crude, oil-product and natural-gas cargoes handled by Marseille port , France ’s largest, increased 9 percent in the first quarter from a year earlier. Volumes rose to 15.3 million metric tons compared with 14.1 million tons a year ago, the port authority said today in an e- mailed statement. Shipments of liquefied natural gas climbed 46 percent to 1.9 million tons, it said. In March, hydrocarbon shipments fell 3.7 percent from a year earlier to 4.9 million tons because of lower crude imports from Libya , according to the port. “The 20 percent drop in crude oil traffic with Libya, the number one client of the port in 2010, was apparently filled by diversification of supply sources by importers,” the port said. Crude imports destined for Europe climbed by 6 percent, led by Petroplus Holdings AG’s Cressier refinery in Switzerland, which increased volumes by 17 percent in the quarter versus a year earlier, the port said. To contact the reporter on this story: Nidaa Bakhsh in London at nbakhsh@bloomberg.net To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

Vietnam Bond Yields Surge to 12-Month High on Inflation Concern

http://www.bloomberg.com/news/2011-04-19/vietnam-bond-yields-surge-to-12-month-high-on-inflation-concern.html

Vietnam ’s five-year bonds dropped, pushing yields to more than a 12-month high, on concern inflation accelerated in April. The dong gained. Consumer prices increased 13.9 percent in March from a year earlier, the most since February 2009, official figures show. The General Statistics Office is due to report the April numbers next week. The yield on the government’s benchmark five-year bond rose 11 basis points to 12.23 percent, the highest level since April 26, 2010, according to a daily fixing price from banks compiled by Bloomberg. “Demand is very weak because investors are expecting yields will reach 13 percent to 14 percent,” said Tran Thi Ngoc Thanh, deputy manager of the investment banking division at Sacombank Securities Joint-Stock Co. “There are forecasts in the market that consumer prices will rise as much as 1.8 percent this month.” The dong gained 0.03 percent to 20,923 per dollar as of 2:58 p.m. in Hanoi, Bloomberg data show. The State Bank of Vietnam fixed the reference rate at 20,733, compared with 20,728 yesterday, its website showed. The currency is allowed to trade up to 1 percent on either side of that rate. --Nguyen Kieu Giang in Hanoi. Editor: Simon Harvey To contact the Bloomberg News Staff on this story: Nguyen Kieu Giang in Hanoi at giang1@bloomberg.net To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net

AT&T Says It ‘Just’ Received RIM’s Bridge E-Mail App For Testing

http://www.bloomberg.com/news/2011-04-19/at-t-says-it-just-received-rim-s-bridge-e-mail-app-for-playbook-testing.html

AT&T Inc. (T) said it has “only just” received a test version of software that enables e-mail on the Research In Motion Ltd. (RIM) BlackBerry PlayBook that was released today. “We’ve only just received the app for testing, and we want to make sure it will deliver a quality experience before we make it available to our customers,” Mark Siegel, a spokesman for Dallas-based AT&T, said in an e-mail message. To contact the reporter on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net To contact the editor responsible for this story: Thomas Giles at tgiles5@bloomberg.net

Indian Weddings Face Curbs as Minister Targets Food Waste

http://www.bloomberg.com/news/2011-04-19/indian-weddings-face-menu-curbs-as-minister-targets-food-waste.html

Indians planning lavish wedding parties may face pressure to slim down their menus, as the government considers curbing celebrations that highlight a growing gulf between rich and poor. Food Minister K.V. Thomas said April 18 that a panel will consider limiting the number of guests who can be invited to weddings and other social events, as well as the dishes they can be served. Neighboring Pakistan restricts such revelers to one plate of food, he said, something India could emulate. While India’s government is reacting after soaring food prices dented the popularity of Prime Minister Manmohan Singh , leading to nationwide protests, wedding planners and policy experts said the proposals would be impossible to enforce and fail to address the root cause of food insecurity in India, home to 42 percent of the world’s undernourished children, according to the International Food Policy Research Institute. “It’s absolutely ridiculous, it’s a reactionary, poorly thought through, populist measure which I don’t think is implementable,” said Ashish Abrol , a former Deutsche Bank AG wealth manager and employee of International Business Machines Corp., who started the wedding planning firm Big Indian Wedding last year. Consumer-price inflation at 9 percent is the highest in the Group of 20 nations after Argentina and Russia. Thomas says up to 30 percent of food is wasted at weddings in India. About 40 percent of India’s fruit and vegetables rot before they can be sold because of a lack of cold storage facilities and poor transport infrastructure, according to government figures. Wal-Mart, Carrefour “To think that it is going to have an impact on the food crisis is completely foolish,” Biraj Patnaik, a campaigner for securing food rights for the poor and an adviser to the Supreme Court , said of Thomas’s plan by phone yesterday. Foreign retailers such as Wal-Mart Stores Inc. (WMT) and Carrefour SA, barred from selling goods directly to Indian consumers, argue they can improve the quality of the supply chain if restrictions are relaxed. Regional political parties within Singh’s ruling alliance oppose such a move, saying that it would threaten the livelihoods of millions of small shopkeepers and drive down farmers’ incomes. India ranked 67 out of 84 nations, below Rwanda, Zimbabwe and Pakistan , on the food policy institute’s Global Hunger Index compiled last year. Indian middle-class weddings are renowned for their over indulgence and growing wealth in the country, fuelled by economic expansion that may reach 9.25 percent this fiscal year, has led to ever more extravagant celebrations. Helicopter Gift Kanwar Singh Tanwar, a businessman and a member of Singh’s Congress party, invited about 30,000 people to celebrate his son’s marriage to a fellow politician’s daughter, the Indian Express reported in March. Tanwar’s son received a Bell 429 helicopter from his parents-in-law and the reception had over 500 counters serving food, the newspaper said. Responding to criticism the wedding was excessive, Tanwar said that the celebration was a “simple” affair, the Express said. Prakash Javadekar, a spokesman for India’s main opposition Bharatiya Janata Party , vowed to support government plans to crack down on excessive spending at weddings, which, he said, risks increasing social unrest in a country where so many people are hungry. “Lavish parties create a divide between the rich and the poor,” said Javadekar, who sits in parliament’s upper house, the Rajya Sabha. “We need simpler marriages.” Food Subsidies In India, about 80 percent of the population controls only 30 percent of the nation’s wealth, according to a study in 2006 by the University of Western Ontario , Canada. Singh’s government will spend about $13.6 billion this fiscal year on food subsidies for the poor. Thomas said the panel that will consider measures to rein in parties will meet in the middle of May and then discuss the matter with representatives of state government in June. Its members have not yet been named, he said. Food-price inflation averaged 16 percent in the last fiscal year after the late arrival of rains caused disruption in the supply of fruits and vegetables including onions, a staple in the local cuisine. Prices of milk, eggs and meat have also gained as rising incomes spur consumer demand. Then Pakistan Prime Minister Nawaz Sharif in 1997 imposed curbs on the amount of food that could be served at weddings as part of austerity measures. Sharif’s brother, Shahbaz Sharif, imposed similar curbs in Pakistan’s Punjab province when he was elected chief minister in 2008. Curry, Rice Hosts can serve a curry, rice and a sweet dish, according to Siddiq-ul-Farooq, a spokesman for the Sharifs’ Pakistan Muslim League. Parties must end by 11 p.m. “This law is working in Punjab and people are benefitting from it,” Farooq said by phone from Islamabad. “Poor people now have a very good reason to avoid overspending on these occasions. In the past, they were forced to follow the rich under social pressure.” Congress President Sonia Gandhi has periodically called on party colleagues to avoid displays of wealth, including telling officials to fly economy class, cut down on phone bills and restrict their use of government-provided vehicles. To contact the reporters on this story: Andrew Macaskill in New Delhi at amacaskill@bloomberg.net ; Prabhudatta Mishra at pmishra8@bloomberg.net To contact the editor responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net ; Sam Nagarajan at samnagarajan@bloomberg.net

Karstadt’s Sales Decline in First Half, FT Deutschland Reports

http://www.bloomberg.com/news/2011-04-19/karstadt-s-sales-decline-in-first-half-ft-deutschland-reports.html

Karstadt Warenhaus GmbH’s sales fell in the first half of the company’s business year by almost 4 percent to 1.78 billion euros ($2.6 billion), Financial Times Deutschland reported, citing documents it obtained. The figures are not adjusted for the closure of 13 department stores, and a Karstadt spokesman said the results had been expected, and the company had planned accordingly, the newspaper said. To contact the reporter on this story: Oliver Suess in Munich at osuess@bloomberg.net To contact the editors responsible for this story: Frank Connelly at fconnelly@bloomberg.net Edward Evans at eevans3@bloomberg.net

Russian Railways to Auction Off Stakes in Units, Zhukov Says

http://www.bloomberg.com/news/2011-04-19/russian-railways-to-sell-stakes-in-units-zhukov-says-correct-.html

OAO Russian Railways approved plans to sell 75 percent minus two shares of its OAO Freight One unit and 25 percent plus one share of OAO TransContainer, said Deputy Prime Minister Alexander Zhukov, the state-owned company’s chairman. The rail monopoly seeks at least 115.5 billion rubles ($4.1 billion) and 10.7 billion rubles for the stakes in Freight One and TransContainer, respectively, Zhukov told reporters today in Moscow, adding that Freight One will be auctioned off in the third quarter. The company’s board approved the plans today. It would keep about 25 percent in each unit after the sales. In October, Russian Railways CEO Vladimir Yakunin said in an interview with Vedomosti newspaper that Globaltrans Investment Plc and companies affiliated with billionaires Vladimir Lisin and Gennady Timchenko were potential buyers. To contact the reporter on this story: Ekaterina Shatalova in Moscow at eshatalova@bloomberg.net To contact the editor responsible for this story: Paul Abelsky at pabelsky@bloomberg.net

Greek Government Condemns Attack on Corfu Synagogue as Vandalism

http://www.bloomberg.com/news/2011-04-19/greek-government-condemns-attack-on-corfu-synagogue-as-vandalism.html

The Greek government said it condemned as an act of vandalism an attack today on a synagogue on the island of Corfu. “The break-in and the destruction of ceremonial books in the Jewish Synagogue of Corfu is an immoral and appalling act” spokesman George Petalotis said in an e-mailed statement from the Athens-based press ministry today. “Anti-Semitism is incompatible with Greek culture.” An unknown group broke into the synagogue early this morning and set religious books on fire, according to a statement by the Greek police today. Police said they are investigating the incident, according to the statement. To contact the reporter on this story: Eleni Chrepa in Athens at echrepa@bloomberg.net To contact the editor responsible for this story: Angela Cullen at acullen@bloomberg.net

Serbia Seeks International Probe on Kosovo Organ Trafficking

http://www.bloomberg.com/news/2011-04-19/serbia-seeks-international-probe-on-kosovo-organ-trafficking.html

Serbia will ask the United Nations Security Council to start an international probe into allegations of organ trafficking in Kosovo in the 1990s, Foreign Minister Vuk Jeremic said. The Balkan nation is seeking the investigation after a December report by Dick Marty, a Swiss member of the 47-member Council of Europe and its lead investigator, that implicated Kosovo Premier Hashim Thaci in organ trafficking and drug smuggling, Jeremic told reporters in Belgrade today. Kosovo, a nation of 2 million, mostly ethnic-Albanians, declared independence from Serbia in February 2008, a move Serbia has vowed never to accept. Most Western powers have recognized Kosovo as a state, including 22 out of 27 members of the European Union and the U.S. The Kosovo government, led by Thaci who was a guerrilla leader of Kosovo’s separatist ethnic Albanians in the 1990s, has dismissed Marty’s report. To contact the reporter on this story: Gordana Filipovic in Belgrade at gfilipovic@bloomberg.net To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

Deutsche Bank, LGT Group Ended BHF Sale on BaFin Fears, FTD Says

http://www.bloomberg.com/news/2011-04-19/deutsche-bank-lgt-group-ended-bhf-sale-on-bafin-fears-ftd-says.html

Deutsche Bank AG (DBK) and Liechtenstein’s LGT Group ended talks on the sale of BHF-Bank AG because LGT feared that BaFin, Germany ’s financial services regulator, would veto the transaction, the Financial Times Deutschland reported, citing finance circles. LGT took insufficient action in the Liechtenstein tax affair and gave BaFin false information on its use of foundations to help clients profit from tax advantages, the newspaper said. In December, LGT, which is owned by Liechtenstein’s princely family, and about 45 of its employees settled criminal proceedings by German prosecutors over charges of abetting tax evasion. To contact the reporter on this story: Eva von Schaper in Munich Bureau at evonschaper@bloomberg.net To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net Edward Evans at eevans3@bloomberg.net

South Korea Buys 30,000 Tons of Chinese, Canadian Soybeans

http://www.bloomberg.com/news/2011-04-19/south-korea-buys-30-000-tons-of-chinese-canadian-soybeans-1-.html

Korea Agro-Fisheries Trade Corp., a South Korean state-run food importer, said it purchased 30,000 metric tons of non-genetically modified Chinese and Canadian soybeans for food use in a tender today. The food agency paid $685.51 a ton on a cost-and-freight basis for 25,000 tons of Chinese soybeans due for delivery by June 30, according to a notice on the importer’s website today. The company bought 5,000 tons of Canadian soybeans due for arrival in June and July for $684.50 a ton on a cost-and-freight basis, it said. To contact the reporter on this story: Sungwoo Park in Seoul at spark47@bloomberg.net. To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

Foreign Direct Investment in China Rises 33% on Fast Growth

http://www.bloomberg.com/news/2011-04-19/foreign-direct-investment-in-china-surges-33-as-zhou-eyes-excess-of-cash.html

Foreign direct investment surged 33 percent in March from a year earlier as rising inflation and interest rates failed to damp overseas confidence in the world’s fastest-growing major economy. Foreign investments added $12.5 billion to China’s economy, the Ministry of Commerce said in a statement in Beijing today. Investments increased at an annual rate of 29 percent in the first quarter. China’s central bank said April 17 it would ratchet up lenders’ reserve requirements for the fourth time this year, aiming to prevent excess cash from fueling inflation that accelerated to the fastest pace in almost three years in March. Wal-Mart Stores Inc. (WMT) said last month it may buy more land to build shops in the world’s most populous nation, which it predicts will be the largest grocery market by 2014. “ China outpaces the growth of other major economies in the world, consequently, the investment flows are continuing,” said David Cohen , a Singapore-based economist at Action Economics who formerly worked for the U.S. Federal Reserve. “The PBOC will need to raise reserve requirement further during the upcoming months to absorb the inflows, so that it doesn’t trigger a surge in inflation.” Cohen expects China to raise the banks’ reserve requirement ratios by 50 basis points by June, and another two to three times in the second half this year. Record Ratio The latest increase in reserve ratios will take effect on April 21, pushing the requirement to a record 20.5 percent for the biggest lenders. China increased interest rates four times since October, to curb inflation that accelerated to a 5.4 percent annual pace in March. Liquidity remains “excessive,” Governor Zhou Xiaochuan said in Beijing last night, a day after the People’s Bank of China announced the fourth increase in lenders’ reserve ratios this year. The investment surge will lead to “more political pressure for Beijing to continue to allow the appreciation of the yuan,” Cohen said. Gradual appreciation of the yuan’s nominal exchange rate against the U.S. dollar will help the country overcome inflation, PBOC Deputy Governor Yi Gang said April 15. Former Chinese central bank adviser Yu Yongding said this month that China should allow its currency to strengthen against the dollar to keep a lid on consumer prices. $3 Trillion Reserves The fastest-growing major economy is attracting money from investors betting on the strength of its expansion and prospects for gains in the yuan. China’s foreign-exchange reserves jumped to a world-record $3 trillion in March, a level that exceeds the nation’s needs, Zhou said after a speech at Tsinghua University in Beijing last night. Gross domestic product expanded 9.7 percent in the first quarter from a year earlier, exceeding economists’ estimate of 9.4 percent, supporting the case for more monetary tightening. “China is not yet done with tightening,” Qu Hongbin , chief China economist at HSBC Holdings Plc in Hong Kong , said before today’s release. “Inflation is likely to accelerate further before a cool-down begins,” he said, predicting a half percentage point of reserve-ratio increases in coming months and a quarter-point boost to benchmark interest rates. Starbucks Corp. (SBUX) , the world’s largest coffee-shop operator, said it aims to increase their presence in China by boosting the number of outlets in China to 1,500 by 2015. --Victoria Ruan, Zhang Dingmin, Chinmei Sung, Sophie Leung. With assistance from Jay Wang. Editors: Lily Nonomiya, Cherian Thomas To contact the reporter on this story: Chinmei Sung in Taipei at csung4@bloomberg.net. To contact the editor responsible for this story: Paul Panckhurst in Hong Kong at ppanckhurst@bloomberg.net

Natural Gas Rises First Time in Three Days on Cooling Demand in U.S. South

http://www.bloomberg.com/news/2011-04-19/natural-gas-rises-first-day-in-three-in-n-y-on-cooling-demand-in-south.html

Natural gas futures gained the most in more than three weeks as forecasts showed hotter-than-normal weather in southern states, lifting demand for gas-fired electricity for air-conditioning. Gas rose for the first time in three days as forecasters including Commodity Weather Group LLC in Bethesda, Maryland , said temperatures may be 14 degrees above normal in the South through April 28. Scheduled gas deliveries to U.S. power plants rose to the highest level in almost 10 weeks, according to data compiled by Bloomberg. “It’s very hot in Florida and Texas, unseasonably hot, and that should lift power demand,” said Phil Flynn , an analyst with PFGBest in Chicago. “We’re hanging around the 200-day moving average. I don’t see anything that’s going to dramatically move gas south in the short-term.” Natural gas for May delivery gained 12.4 cents, or 3 percent, to settle at $4.262 per million British thermal units on the New York Mercantile Exchange , the biggest percentage gain since March 25. The 200-day moving average was $4.1298. The futures have risen 8.1 percent from a year ago. The warm weather across the South will spread along the East Coast into New York and New England by the end of the month, according to Commodity Weather Group. Houston will have a high of 91 degrees Fahrenheit (33 Celsius) on April 27, 10 degrees above normal, according to AccuWeather Inc. in State College , Pennsylvania. The high temperatures in Jacksonville, Florida, will stay above 80 degrees this month. Hottest April “The South is expected to experience one of the hottest Aprils in history, which should generate incremental increases in power loads,” Shiyang Wang, an analyst at Barclays Capital in New York, said in a note to clients today. Scheduled gas deliveries to power plants increased 4.2 percent today to 14.4 million dekatherms (14.1 billion cubic feet), the highest level since Feb. 10, according to Bloomberg data based on a sampling of gas pipeline nominations. Deliveries to Texas for power generation were set to rise 8.4 percent to 2.33 million dekatherms, and planned deliveries to Florida’s power plants gained 0.9 percent to 2.86 million dekatherms, the data showed. Global output of liquefied natural gas reached a record in March after Qatar increased shipments, Societe Generale (GLE) SA said in a report today. Production of the fuel climbed to 21.8 million metric tons last month, Thierry Bros, a Paris-based analyst for the bank, said in the report. LNG imports to the U.S. will fall to the equivalent of 1.05 billion cubic feet a day of gas, down from 1.18 billion a year ago, according to Energy Department estimates. Gas futures volume in electronic trading on the Nymex was 254,610 as of 2:37 p.m., compared with the three-month average of 324,000. Volume was 320,315 yesterday. Open interest was a record 983,802 contracts, according to the exchange. The three- month average open interest is 913,000. The exchange has a one-business-day delay in reporting open interest and full volume data. To contact the reporter on this story: Moming Zhou in New York at Mzhou29@bloomberg.net. To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

Oil Volatility Slips as Futures Rise Fourth Time in Five Days

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Oil options volatility slipped on the fourth front-month futures increase in five days as speculation that the European Central Bank will further raise interest rates strengthened the euro against the dollar. Implied volatility for at-the-money options expiring in June, a measure of expected price swings in futures and a gauge of options prices, was 26.8 percent as of 4 p.m. in New York , down from 27.7 percent yesterday. Oil for May delivery rose $1.03, or 1 percent, to expire at $108.15 a barrel on the New York Mercantile Exchange. Prices are up 33 percent from a year ago. June futures increased 59 cents, or 0.6 percent, to $108.28. The May contract expired at the close of floor trading today. The most active contracts in electronic trading were June $90 puts with 2,381 lots changing hands. They fell 3 cents to 8 cents a barrel. December $200 calls, the next most active contract, slipped 2 cents to 41 cents a barrel with 2,114 contracts trading. One contract is for 1,000 barrels of oil. May options expired April 14. Nymex distributes real-time data for electronic trading and releases information on floor trading, where the bulk of options trading occurs, the next business day. June $100 puts were the most active options traded in the previous session, with 9,959 lots changing hands. They rose 25 cents to 79 cents a barrel. The next most active option, June $105 puts, gained 63 cents to $2.13 a barrel on 5,452 lots. Open interest was highest for June $150 calls with 44,086 contracts. Next were December 2012 $80 puts with 43,312 and December $120 calls with 38,611. To contact the reporter on this story: Margot Habiby in Dallas at mhabiby@bloomberg.net. To contact the editor responsible for this story: Bill Banker at bbanker@bloomberg.net .

Ford to Make Compact SUVs in China, Boost Marketing Spend

http://www.bloomberg.com/news/2011-04-19/ford-to-make-compact-suvs-in-china-boost-marketing-spend-1-.html

April 19 (Bloomberg) -- Ford Motor Co. (F) said it will make the next generation of its Kuga compact sport-utility vehicle in China and boost marketing spending to help win sales in the world’s largest auto market. “We have to make sure our advertising spend is high enough as a percentage of our revenue,” Jim Farley , the company’s group vice president for global marketing, sales and service, said today at the Shanghai auto show. He didn’t elaborate on how much the company planned to spend. The addition of the Kuga, a C-segment or compact vehicle, is part of Ford’s plans to introduce 15 models in China by 2015. The Dearborn, Michigan-based company also intends to double its number of dealerships to 680 to help challenge market leaders General Motors Co. and Volkswagen AG. “To be a volume player in China , you have to execute the C-segment flawlessly,” Farley said. The automaker didn’t say when China production of the Kuga may start. Ford, which sells the Focus compact and Fiesta subcompact in China, has a market share of 2.4 percent, according to industry researcher J.D. Power & Associates. The automaker expects China’s car market to grow as much as 10 percent this year, with its own sales outpacing the industry. Last year, Ford’s China deliveries rose 40 percent to 582,467, surpassing the 32 percent industry average. The company is banking on emerging markets to help it maintain profits after posting $6.56 billion in net income last year, the most since 1999. It is building a new vehicle plant through its China venture in Chongqing and it has plans for a new engine plant in the southwestern city. --Liza Lin. Editors: Neil Denslow, Jamie Butters To contact the Bloomberg News staff on this story: Liza Lin in Shanghai at llin15@bloomberg.net To contact the editor responsible for this story: Kae Inoue at kinoue@bloomberg.net

TeliaSonera First-Quarter Net Declines to $740 Million, Missing Estimates

http://www.bloomberg.com/news/2011-04-19/teliasonera-first-quarter-net-declines-to-740-million-missing-estimates.html

TeliaSonera AB (TLSN) reported first- quarter sales and profit that missed estimates and lowered its full-year revenue forecast as European markets lagged behind growth in central Asia. Net income fell 1.6 percent to 4.65 billion kronor ($736 million), from 4.72 billion kronor a year earlier, Stockholm- based TeliaSonera said in a statement today. Revenue slipped 5.6 percent to 24.7 billion kronor. The average estimates of analysts surveyed by Bloomberg were for profit of 4.81 billion kronor and sales of 25.4 billion kronor. TeliaSonera is encountering tougher competition in its home Nordic markets as rivals including Tele2 AB and Elisa Oyj step up sales of smartphones and data packages. Lower handset revenue and higher regulatory charges contributed to slippage in the region, the company said. Central Asia sales gained 9.2 percent, driven by Kazakhstan and Uzbekistan. “Revenue weakness extended across all units with the exception of Norway and Eurasia, which was merely in line,” Ulrich Rathe, a London-based analyst at Jefferies International Ltd., wrote in a note. “The major contributors to the group revenue shortfall were fixed wholesale and ‘other,’ both contributing 81 percent to the miss. Both units are areas of low visibility and minor contributors to value.” Shares Fall TeliaSonera shares declined as much as 2.8 percent to 48.36 kronor, and traded 1.4 percent lower at 49.07 kronor as of 1:26 p.m. in Stockholm. TeliaSonera said it expects net sales growth in local currencies and without acquisitions to be about 3 percent this year, down from an earlier forecast of 4 percent. The company has said it is willing to expand by consolidating in its markets and has bid for Polkomtel SA, the second-largest mobile company in Poland , which adjoins its Baltic operations. Five companies or groups were bidding, Polkomtel Deputy Chief Executive Officer Krzysztof Kilian said on April 6. Polkomtel may go for more than $5 billion, based on the valuation of a 2008 stake sale by Denmark ’s TDC A/S. “There are many bidders, which means the price is probably going to be not cheap,” Chief Executive Officer Lars Nyberg said in an interview. “I don’t think Polkomtel is strategically necessary for us but if we can get it for a decent price and we believe that we can improve that business then maybe we have a case. But we are not there yet, not at all.” Turkcell Plans TeliaSonera aims to stick with Turkcell Iletisim Hizmetleri AS, the Turkish operator in which it holds a 38 percent stake and is now trying to get more independent directors appointed to the board, Nyberg said. “If you as the biggest owner consider leaving because a company is going through some difficulties, you are then more of short-term investor,” Nyberg said. “TeliaSonera is a telecom operator, we love this asset and we intend to keep it.” TeliaSonera never planned to merge Turkcell with Russian operator OAO MegaFon, in which it also holds a stake, Nyberg added. A 2009 plan to combine TeliaSonera’s holdings in the two companies with those Russia ’s Alfa Group to simplify governance, without combining operations, has been delayed by conflicts over shares in Turkcell. Nyberg wouldn’t speculate on the outcome of Turkcell’s annual investor meeting scheduled for April 21. To contact the reporter on this story: Diana ben-Aaron in Helsinki at dbenaaron1@bloomberg.net To contact the editor responsible for this story: Vidya Root in Paris at vroot@bloomberg.net

Yahoo's First-Quarter Sales Beats Estimates as Online-Ad Demand Increases

http://www.bloomberg.com/news/2011-04-19/yahoo-s-first-quarter-sales-beat-estimates-as-advertising-demand-increases.html

Yahoo! Inc., the most-visited U.S. Web portal, reported first-quarter sales that topped estimates as companies stepped up their use of Internet advertising. The shares rose as much as 5.5 percent in late trading. Excluding sales passed on to partner sites, revenue was $1.06 billion, Sunnyvale, California-based Yahoo said today in a statement. Analysts had estimated $1.05 billion, according to data compiled by Bloomberg. Chief Executive Officer Carol Bartz is benefiting from buoyant demand for display advertising, such as banners and videos, as Yahoo sites attract more visitors. U.S. users grew 15 percent to 179.5 million in March from the year-earlier period, putting Yahoo ahead of No. 2 Google Inc. (GOOG) ’s 176.8 million, according to ComScore Inc. Yahoo’s results eased concern that arose in January after its forecast disappointed investors. “This certainly gives her some breathing room,” said Kerry Rice, an analyst with Wedbush Securities Inc. in Los Angeles. He rates the stock “underperform” and doesn’t own it. “This keeps investors on the line.” Yahoo rose as much as 88 cents to $17 in extended trading. The shares, down 3.1 percent this year, had closed at $16.12 earlier on the Nasdaq Stock Market. Quarter Forecast Sales will be $1.08 billion to $1.13 billion in the second quarter, the company said. The midpoint of that range matched the $1.1 billion projected by analysts. First-quarter net income attributable to the company fell to $223 million, or 17 cents a share, from $310.2 million, or 22 cents, Yahoo said. One-time benefits a year earlier accounted for some of the decrease. Excluding some items, Yahoo had earnings of 19 cents a share, topping the average estimate of 16 cents. Yahoo’s sales have been shrinking as the company offloads businesses, farms out much of its search operations and refocuses on its best-performing websites. At the same time, it’s selling more display ads. Excluding revenue shared with partner sites, display-advertising sales climbed 10 percent last quarter to $471 million. “Our turnaround is proceeding right on schedule,” Tim Morse, chief financial officer, said in an interview. “We’re confident that we’re heading in the right direction.” Improvements Seen During the quarter, Web visitors’ engagement on the site showed some improvements. Page views on Yahoo’s media properties, including the home page, were up 8 percent during the quarter after declining in previous months, the company said. Time spent on those properties rose 17 percent. Still, page views on communications and communities, including Yahoo e- mail and its “Groups” messaging service, fell 6 percent and time spent fell 10 percent. Yahoo is trying to maintain its role as a top Internet portal at a time when more users are heading to social- networking sites, such as Facebook Inc. and Twitter Inc. Under Bartz, who became CEO in January 2009, the company has pared down its workforce in a bid to make Yahoo more efficient. Earlier this year it announced plans to cut about 1 percent of its staff, following a decision to eliminate about 4 percent, or about 600 jobs, in December. Bartz also struck a deal with Microsoft Corp. (MSFT) to use its search technology on Yahoo’s sites. As part of the agreement, Yahoo shifted its search-marketing platform for advertisers to Microsoft’s system, called AdCenter. The companies began the shift in October with Canada and the U.S. AdCenter Pause The company will hold off on further implementation of the search-advertising part of the agreement until Microsoft improves the performance of its AdCenter platform, which has been a disappointment thus far, said Bartz, who met personally with Microsoft officials. Bartz said she is confident Microsoft, which is guaranteeing revenue for Yahoo during the transition, will address “issues” with the platform. Overall, she said the quarter’s results show her efforts to turnaround the company. “We continue to make headway on our plan to increase profitability and grow revenue,” Bartz said. “We are growing engagement and monetizing it.” Microsoft has expanded its share of the U.S. search market for eight straight months, reaching 13.9 percent in March, while Yahoo’s declined last month to 15.7 percent from 16.1 percent the previous month, according to Reston, Virginia-based ComScore. Still, Google holds more than twice the market share of both companies combined, with 65.7 percent. Yahoo also has held talks to dispose of its stake in Yahoo Japan , an Internet portal company, two people familiar with the matter said last month. Yahoo co-owns the Tokyo-based joint venture with Softbank Corp. To contact the reporter on this story: Brian Womack in San Francisco at bwomack1@bloomberg.net To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net

Nokia Profit May Fall 49% as Pressure Grows on Elop's Symbian Handset Goal

http://www.bloomberg.com/news/2011-04-19/nokia-net-may-fall-49-as-pressure-grows-on-elop-s-handset-goal.html

Nokia Oyj (NOK1V) may tomorrow report a 49 percent decline in profit and forecast further erosion before the world’s biggest maker of mobile phones introduces its first smartphones using Microsoft Corp.’s operating system. First-quarter net income at Espoo, Finland-based Nokia may drop to 177 million euros ($253 million) from 349 million euros a year earlier, according to the average of 19 analyst estimates compiled by Bloomberg. The operating margin for devices and services adjusted for some items probably fell 3.6 percentage points to 8.5 percent, the average of 23 estimates shows. Chief Executive Officer Stephen Elop, a former Microsoft executive, said in February Nokia will adopt Microsoft’s Windows Phone 7 as its main smartphone operating system, replacing the Symbian platform it has used for more than a decade. Investors want to know how long it will take to reach a goal of selling 150 million more handsets on the last versions of Symbian. “I’ll be looking at the slope of the decline -- whether or not the second quarter ends up being weaker than the first quarter and therefore by implication how deep the trough might be before we get a new product-driven recovery,” said Stuart Jeffrey, an analyst at Nomura International Plc in London who has a “reduce” rating on the stock. Operating Margin Nokia hasn’t provided a full-year forecast, citing uncertainty caused during the transition to Microsoft’s software. On Feb. 11, the day it announced the agreement, Elop set a long-term target to increase handset sales faster than the market with an adjusted operating margin of 10 percent or more after the shift to Windows Phone, which he expects to take place during 2011 and 2012. The shares added 7.5 cents, or 1.3 percent, to 5.86 euros at 10:30 a.m. in Helsinki, valuing the company at 21.9 billion euros. Before today, Nokia had lost 29 percent since announcing the Microsoft partnership. Investors will look for guidance on how long handset margins will stay below last year’s 10.9 percent level , and how big the reorganized company will be. Elop has predicted “substantial reductions” in jobs from cuts that analysts say may slash a third of the 3 billion-euro annual research and development budget. Job Cuts? “As the current Symbian portfolio matures and actually starts to expire without any new Windows devices coming out in the near future, I think the second half and specifically the third quarter might be very, very difficult,” said Mikko Ervasti, a Helsinki-based analyst at Evli Bank. Symbian’s market share, at 37.6 percent in 2010, will fall to 19.2 percent this year and 5.2 percent in 2012, according to forecasts by researcher Gartner Inc., which measures sales to consumers. In the fourth quarter, Nokia had a smartphone share of 30.8 percent, down 20 percentage points since Apple Inc. (AAPL) shipped its first iPhone in 2007, according to Gartner. Apple, which reports results today, may say profit rose 64 percent to $5.03 billion on sales of about $23.4 billion. Nokia’s own first-quarter forecast for devices and services sales is 6.8 billion euros to 7.3 billion euros, with an operating margin in devices, adjusted for restructuring charges and amortization of acquired assets, of 7 percent to 10 percent. Apple, Sony Ericsson Sony Ericsson Mobile Communications Ltd., which shifted to Android from Symbian last year, yesterday reported a surprise profit of 11 million euros after the company sold more higher- priced handsets. Nokia will report earnings at about 1 p.m. local time tomorrow, with a conference call at 3 p.m. that can be monitored through the company’s website. “My sense is that the temptation will be quite strong for Elop to kitchen-sink this quarter -- try to set a clear canvas by saying it’s possible we could be down 20 percent year on year in unit shipments,” said Lee Simpson , an analyst at Jefferies International Ltd. in London. Nokia device shipments in the first quarter, typically the company’s weakest, probably slipped 1.6 percent from a year earlier to 106.1 million units, according to analysts surveyed by Bloomberg. The company’s portfolio in the quarter included the N8 touchscreen phone that it used to release an improved Symbian in September, along with three related models including the C7, which T-Mobile USA is selling as the Astound. Android, IPhone5 First-quarter revenue probably rose 6.5 percent to 10.14 billion euros, the average of 39 estimates, as Nokia rolled out the new models to more operators and markets. Nokia last week unveiled a further update to Symbian and two smartphones to ship in summer, when they’re likely to compete with Apple’s iPhone 5 and the latest models running Google Inc. (GOOG) ’s Android system from vendors including Samsung Electronics Co., the world’s second-largest handset vendor, and HTC Corp. (2498) , the Taiwanese manufacturer that passed Nokia in market value this month. Gartner predicts Android will run on 38.5 percent of smartphones sold this year. The Google software is moving into cheaper hardware and starting to compete with the high-volume, low-margin phones business that made up half of Nokia’s handset revenues and 78 percent of its unit sales last year. “Investors will want to get a sense of how long a tail Symbian will have, how quickly it’ll ramp down,” said Stephen Patel, a San Francisco-based analyst at Gleacher & Co. “ It’ll depend on consumer reaction to Nokia going end-of-life with Symbian. Some don’t care and others don’t want to buy a product that isn’t going to be around in a few years.” Japan Effect Investors will also look for guidance on whether disruptions following the earthquake in Japan last month will affect shipments in the second and third quarters, Patel said, adding that it could offset the usual seasonal increase. “I’ll be looking at the potential impact of Japan especially in terms of supply chain, potential bottlenecks, and the margins -- whether or not the deterioration we’ve seen during the last year will continue,” said Leon Cappaert, a fund manager at KBC Asset Management in Brussels with 330 million euros under management, including Nokia shares in a general fund for weighting purposes. To contact the reporter on this story: Diana ben-Aaron in Helsinki at dbenaaron1@bloomberg.net To contact the editor responsible for this story: Kenneth Wong in Berlin at kwong11@bloomberg.net

Gulf Stocks: Al Meera, Doha Bank, Sabic, Savola, Sorouh

http://www.bloomberg.com/news/2011-04-19/gulf-stocks-al-meera-doha-bank-sabic-savola-sorouh.html

Dubai’s DFM General Index (DFMGI) advanced 0.1 percent, according to the bourse’s website. Abu Dhabi’s ADX General Index (ADSMI) dropped 0.2 percent and Saudi Arabia’s Tadawul All Share Index (SASEIDX) retreated 0.1 percent. The following stocks rose or fell in the Persian Gulf region. Symbols are in parentheses. Al Meera Consumer Goods Co. (MERS QD) advanced the most in almost a week, rising 1.1 percent to 86.9 riyals. The shares were trading ex-dividend today. The company that operates a chain of stores in Qatar said first-quarter profit rose to 12.6 million riyals ($3.5 million) from 9.2 million riyals a year earlier. Doha Bank QSC (DHBK) rose the most in a month, advancing 2.1 percent to 52.6 riyals. Qatar’s fourth-biggest bank by assets said first-quarter profit rose 15 percent to 363 million riyals. Saudi Basic Industries Corp. (SABIC) increased the most since March 20, rising 2.6 percent to 109 riyals. The world’s biggest petrochemicals maker said first-quarter profit surged 42 percent to 7.69 billion riyals ($2 billion) from a year ago. Savola (SAVOLA) Azizia United Co. (SAVOLA AB) dropped the most since March 15, falling 2.2 percent to 26.7 riyals. The Saudi Arabian food producer said first-quarter profit declined 58 percent to 165.2 million riyals after a 2010 capital gain wasn’t repeated and global commodity prices hurt margins. Sorouh Real Estate Co. (SOROUH) surged to the highest since Jan. 23, increasing 3.5 percent to 1.5 dirhams. Abu Dhabi’s Urban Planning Council signed housing contracts valued at 13.5 billion dirhams ($3.7 billion) including a 2.89 billion- dirham deal with Sorouh to build 7,500 houses for United Arab Emirates ’ nationals. To contact the reporter on this story: Zahra Hankir in Dubai at zhankir@bloomberg.net To contact the editor responsible for this story: Claudia Maedler at cmaedler@bloomberg.net

European Construction Output Dropped in February, Led by France

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European construction output fell in February, led by declines in France and Slovenia. Construction in the 17-member euro region slipped 0.7 percent from January, when it advanced a revised 3.6 percent, the European Union’s statistics office in Luxembourg said today. From a year earlier, output rose 3.5 percent. In France, the region’s second-largest economy, output fell 0.1 percent from January, when it surged 14 percent, today’s report showed. Slovenian output fell 7.9 percent. German production advanced 3.4 percent after jumping 35 percent in January. In the 27-member European Union, construction rose 0.7 percent from January. The statistics office didn’t provide monthly data for countries including Spain , Ireland, Belgium and Greece. To contact the reporter on this story: Simone Meier in Zurich at smeier@bloomberg.net To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net

Canacol Drops for 11th Day on Delayed Results for Guyana Field

http://www.bloomberg.com/news/2011-04-19/canacol-drops-for-11th-day-on-delayed-results-for-guyana-field.html

Canacol Energy Ltd. (CNE) , the Calgary- based oil company that operates fields in South America , headed toward the lowest closing price in seven months on delayed results of drilling at an exploratory well in Guyana. The shares fell for the 11th consecutive day, sinking 1.7 percent to 2,320 pesos in Bogota trading at 12:40 p.m. New York time. A close at that level would be the lowest since Sept. 30. The company continues to drill and test the Apoteri K-2 well in Guyana, Kevin Flick, head of investor relations for the company, said in a phone interview. Exploration began in December and was interrupted in January because of the late arrival of some equipment, according to a statement March 7. Canacol hasn’t given further details on plans for a second well in the Takutu block, which had been slated for next month. “The stock is probably being hit due to a lack of information about that project,” said Santiago Melo, an analyst at brokerage Alianza Valores SA in Bogota. “The Colombian market has also been weak in general, but Canacol is out of the ordinary.” Flick said Canacol will release information about the well as soon as possible. “Until drilling and testing is done, I’ve been instructed to stay quiet,” he said. “I realize the market is skittish with the stock.” To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

World Monuments Leader Morphs Into Painter, Has Show: Interview

http://www.bloomberg.com/news/2011-04-19/world-monuments-leader-morphs-into-painter-opens-chelsea-show-interview.html

High up in the historic Ansonia -- favored home of singers, artists, eccentrics -- on Manhattan ’s west side, Marilyn Perry is wondering which of her many paintings she likes the most. “Maybe that one?” She ponders, pointing to a vibrant green work bursting with life. “But I’d sell it anyway.” For decades Perry, 71, made her mark as the president of the Samuel H. Kress Foundation and chairman of the World Monuments Fund , which she built into architecture’s version of the World Wildlife Fund. Crumbling landmarks, from temples at Angkor, Cambodia to the ancient Maya city of Naranjo, Guatemala , have benefited from Perry’s zealous fundraising and strategic alliances. Carlos Slim , James Wolfensohn, the Prince of Wales , Brooke Astor, Paul Mellon and Eugene Thaw are only some of the global personalities who were happy to receive preservation’s highest recognition, the Hadrian Award of the WMF. Retiring in 2007, Perry has been painting obsessively ever since. Tonight, tomorrow and Thursday, see a show of her new work at the Rogue Space in Chelsea, a gallery artists can rent for short periods. View the paintings beginning at 2 p.m., and have a drink with the artist from 5 to 8 p.m. We continued speaking as her curator, Chris Watson, packed the pictures onto luggage racks and into a waiting van. Lundborg: What was it like to put a brush to canvas for the first time? Sky’s the Limit Perry: It felt like a liberation. I love the excitement of creating something that’s separate from yourself, but that’s come out of your existence. Lundborg: When did it get really interesting? Perry: I started by taking a little workshop in the country with a local artist, and then I started ordering how-to books. It got interesting when I realized the sky’s the limit, that with painting, you can do anything. Lundborg: Did being an art historian help? Perry: Spending so much time in the company of the artists I love gave me a sense of proportion and color. Lundborg: How has your relation to painting changed? Perry: I’m less possessive. When I sold my first painting, it was like giving away a child. Now, I know I’ll do other things I like. Lundborg: But selling must also be a validation? Perry: The most gratifying moment was when I sold my first canvas to a stranger. Somebody bought it off the wall in a group show, and I wasn’t even there. It went for $450. Lundborg: Is that when you started feeling like a professional painter? Who Was I? Perry: It was gradual. It didn’t come from selling work, but from the pattern of my life, how my day was structured and what I thought about. It was a very big transition from one role to another: You are no longer who you were. One of my friends was a CEO and after he sold his company, he told me that he got up, put on a suit and went to the library. Lundborg: How do you put a price on your work? Perry: That’s difficult. So many things come into play: who your audience is, what the value of a new (old!) painter is, what you love. Someone bought a painting of trees because it made her feel happy, as though she were a child again about to go play in the woods. Lundborg: Historically, what painters would you most like to meet? Perry: Titian for color, Velazquez for the brush stroke, though I don’t dare to do portraits, except dogs under duress. And Turner, whose space-dissolving pictures broke into new realms. Forgotten Emperor Lundborg: You made preservation chic and important. How did you come to realize that you could help save some of the great endangered places? Perry: When I lived in Italy , I met Colonel James Gray, who raised funds for particular sites, and I actually saw him successfully saving monuments. When he wanted to retire, there was no succession. He came to me, and we decided to invent a brand-new kind of nonprofit organization. Lundborg: What are the biggest threats? Perry: Neglect, active destruction, natural disasters and then there are buildings that are financially beyond the local community to help. Lundborg: What’s your most satisfying save? Perry: The Qianlong Garden in the Forbidden City. In 1771, the fifth emperor of China ’s Qian dynasty started building a two-acre retreat with four courtyards, five rockeries and 27 pavilions and structures. It was largely abandoned in 1924. We got the Chinese to recognize something that they didn’t know they had. There’s currently a show at the Met Museum with treasures that were recovered from the Emperor’s private paradise. Marilyn Perry’s work can be seen at Rogue Space Gallery, 508 W. 26th St. until April 21 and at http://www.marilynperryart.com. Prices range from about $500 to $3,000 for large seascapes. (Zinta Lundborg is an editor for Muse, the arts and leisure section of Bloomberg News. The opinions expressed are her own. This interview was adapted from a longer conversation.) To contact the reporter on this story: Zinta Lundborg at zlundborg@bloomberg.net. To contact the editor responsible for this story: Jeffrey Burke at jburke21@bloomberg.net .

EU Carbon Advances After Reaching 6-Day Low; Gas Little Changed

http://www.bloomberg.com/news/2011-04-19/european-union-carbon-drops-to-a-six-day-low-as-gas-falls-weather-warms.html

European Union carbon permits advanced after reaching their lowest price in six days as natural gas erased losses. Carbon futures for December rose 0.9 percent to 16.82 euros ($24.10) a metric ton on the ICE Futures Europe exchange in London as of 5:40 p.m. They declined earlier as low as 16.53 euros. U.K. gas for the six months through September next year, the summer contract, was little changed after yesterday’s 1.7 percent decline. Carbon fell 2.6 percent yesterday, its biggest drop in a month, after Standard & Poor’s Ratings Service revised its long- term sovereign credit rating outlook for the U.S., the world’s largest economy, to negative from stable. Power utilities are buying emission permits as they sell power forward through 2014. A decision by Germany to phase out nuclear power may add some upside pressure to emission permits this week, said Emmanuel Fages and Carine Hemery, Paris-based analysts for Orbeo, the carbon venture of Rhodia SA and Societe Generale SA. “Downside risks will cap the increase of carbon prices,” which probably won’t move beyond 17.25 euros a ton this week, they said yesterday in an e-mailed research note. This week’s minimum should be 16.50 euros, according to Orbeo. Warmer weather will curb energy demand for heating, Fages and Hemery said. High temperatures in Frankfurt are forecast at 23 degrees Celsius (73 Fahrenheit) tomorrow, compared with a 30- year median maximum of 14 degrees, according to weather data on Bloomberg. They will rise as high as 26 degrees on April 21. London temperatures may be as low as 7 degrees tomorrow, compared with a median minimum of 5 degrees. To contact the reporter on this story: Mathew Carr in London at m.carr@bloomberg.net To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net