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Monday, 16 December 2013

Hungary’s high court ruling boosts banks, upholds rule of law | beyondbrics

Hungary’s high court ruling boosts banks, upholds rule of law | beyondbrics:

"A ruling on Monday by the Kuria, Hungary’s supreme court, that foreign-currency loans issued in the past decade by local banks were legal, triggered a jump in shares of OTP, Hungary’s largest bank, on the Budapest Stock Exchange. The stock – often seen as a proxy for the Hungarian economy – gained more than 5 per cent to Ft 4,420 in the early afternoon, before easing back to close at Ft 4,311, up 2.8 per cent.

Foreign-currency loans, predominantly in Swiss francs, became hugely popular in Hungary between 2001 and 2008 as borrowers rushed to take advantage of much lower interest rates than those on loans taken out in forint, the local currency.

However, the economic downturn in 2008 saw tens of thousands of households struggling to meet higher monthly repayments as the forint tumbled against both the franc and the euro."

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ANALYSIS-Russia's South Stream gas line viable but legally risky | Reuters

ANALYSIS-Russia's South Stream gas line viable but legally risky | Reuters:

"* South Stream could be economically viable despite huge costs

* Plans to pump 63 bcm of gas to south Europe from 2018

* Would cement Russian dominance of Europe's gas supplies

* Pipeline route avoids Ukraine

By Barbara Lewis and Henning Gloystein

BRUSSELS/LONDON, Dec 16 (Reuters) - Russia's South Stream pipeline project for transporting gas to southern Europe is economically viable, despite its price tag of $45 billion, but legal issues with Brussels risk derailing the entire endeavour.

In a sign of the strategic but fraught relationship between Russia and the European Union, state-controlled Gazprom this month opened a new office in Brussels, taking up two floors of a city centre property.

In town for the opening, Gazprom Deputy Chairman Alexander Medvedev called in at the European Commission, the EU executive, and offered concessions to try to settle an EU investigation into charges it has priced gas unfairly."

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Bank of Sharjah Expects Profit to Rise Up to 30% in 2013, 2014 - Bloomberg

Bank of Sharjah Expects Profit to Rise Up to 30% in 2013, 2014 - Bloomberg:

"Bank of Sharjah sees profit rising between 25 percent and 30 percent both this year and next on increased financing activity and lower provisions for bad debt.

“We’ve had a very good year,” Varouj Nerguizian, executive director and general manager at Bank of Sharjah, told reporters in the emirate late yesterday. “We expect profitability to be higher by between 25 percent to 30 percent.”

In 2014, the bank will grow at similar levels with loan growth expected to be about 15 percent to 20 percent, he said. Dubai’s successful bid to host the World Expo 2020 exhibition and the potential for increased trade with Iran, if economic sanctions against the country are eased, will help growth, Nerguizian said."

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Fitch puts Ukraine on downgrade watch as bonds rally | beyondbrics #EuroMaidan

Fitch puts Ukraine on downgrade watch as bonds rally | beyondbrics:

"It’s not a downgrade, nor even a change in outlook, but a statement issued by Fitch Ratings on Monday is still a warning. Ukraine’s credit rating is under pressure and looking increasingly vulnerable.

Investors, you might think, already knew that. So it’s ironic that Fitch should speak out on a day when the yield on Ukraine’s benchmark 2023 bond fell to 9.86 per cent, down from a recent peak of 10.6 per cent on December 10, according to Thomson Reuters data. Why are investors so (comparatively) positive?


Source: Thomson Reuters

One reason – as Timothy Ash of Standard Bank and others have argued – is that they are ignoring the risk of cross-the-board default on Ukrainian government debt. As Ukraine’s inverted yield curve suggests, investors may believe trouble is round the corner but will be resolved in the longer term."

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Ukraine-Russia Loan Talks Said to Be on Up to $15 Billion - Bloomberg #EuroMaidan

Ukraine-Russia Loan Talks Said to Be on Up to $15 Billion - Bloomberg:

"Ukraine is likely to get a discount for Russian natural gas of at least 25 percent from the price it now pays, according to Viktor Medvedchuk, a Ukrainian ally of Russian President Vladimir Putin.

“I believe that the gas price will be reduced,” Medvedchuk, who’s lobbying for Ukraine to join an economic bloc championed by Putin, said last week in his office in the center of Kiev, Ukraine’s capital. Russia may agree to cut the price by $100-$140 per 1,000 cubic meters from the current level of more than $400, he said. Shares in OAO Gazprom, Russia’s pipeline gas monopoly, rose to the highest in more than a month.

Putin and Ukrainian President Viktor Yanukovych meet tomorrow in Moscow, and there is a “big probability” that the two countries will sign a gas deal, Ukraine’s Energy Minister Eduard Stavytskyi said today in Kiev, declining to elaborate."

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Emerging Stocks Drop on China as Ukraine Loan Outlook Spurs Debt - Bloomberg

Emerging Stocks Drop on China as Ukraine Loan Outlook Spurs Debt - Bloomberg:

"Emerging-market stocks headed for a month low after data showing Chinese manufacturing unexpectedly fell weighed on Asian shares. Ukraine’s stocks and bonds gained as the debt-strapped country prepares for talks in Moscow.

SAIC Motor Corp. (600104) paced losses by Chinese automakers in Shanghai amid concern city governments will impose more measures to curb pollution. The Ukrainian Equities Index (UX) climbed for a fourth day and the government’s 2014 bonds rallied. OAO Gazprom led a 0.8 percent advance on the Micex Index in Moscow, while stocks in Turkey and Hungary added at least 0.8 percent following better-than-expected euro-zone factory data. Brazil’s Ibovespa increased 0.2 percent as commodities including crude oil and industrial metals advanced.

The MSCI Emerging Markets Index dropped for a fifth day, losing 0.1 percent to 989.12 at 1:13 p.m. in London. China’s Purchasing Managers’ Index fell to a three-month low, suggesting the world’s second-largest economy is vulnerable to a slowdown. Investors are awaiting the fate of an $85 billion monthly bond-buying program before the Fed’s monetary policy meeting."

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MIDEAST STOCKS-Dubai's Emaar Properties drags down index for worst loss in 4 wks | Reuters

MIDEAST STOCKS-Dubai's Emaar Properties drags down index for worst loss in 4 wks | Reuters:

"* Emaar down 3.3 pct on dilution worry related to convertible

* But analysts say impact would be minor

* Kuwait index holds support on 200-day average

* Saudi's PetroRabigh jumps 9.9 pct again on marketing deal

* Dhofar International, Oman Investment up on M&A

By Nadia Saleem

DUBAI, Dec 16 (Reuters) - Dubai's bourse suffered its largest loss in a month on Monday as investors sold blue chip Emaar Properties in a delayed reaction to the prospect of dilution from a convertible bond. Other regional markets were narrowly mixed.

Emaar dropped 3.3 percent to 7.14 dirhams a day after the company said it would discuss on Tuesday whether to convert the bond into shares, after bond holders asked for the conversion. The developer issued a $500 million convertible bond in 2010, with maturity in 2015.

However, if full conversion takes place at 4.38 dirhams per share, there should only be a slight dilution of 2.2 percent in the stock price, analysts at NBK Capital estimated in a note."

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Australia 'puts the gas down' to end 40-year deficit – Morgan Stanley — RT Business

Australia 'puts the gas down' to end 40-year deficit – Morgan Stanley — RT Business:

"Morgan Stanley says Australia will become the world’s biggest liquefied natural gas (LNG) exporter by 2017. This will help the country end 40 years of current account deficits.

“Liquefied natural gas (LNG) exports from Australia could be the next big thing,” The Telegraph cites the report as saying.

According to the research, the county is expected to experience a “huge ramp-up” in LNG output, pushing Australia to top of the list of LNG exporters, leaving Qatar behind by 2017. That pace of development, coupled with coal exports, will make the country a major force in global energy production.

“The ramp-up would be enough to see Australia record a current account surplus in 2015, the first since the second quarter of 1975. It is difficult to overestimate the long-term structural importance of this industry to Australia,” said the bank’s East Asia expert Geoffrey Kendrick."

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[video] Shale shock | beyondbrics

[video] Shale shock | beyondbrics:

"Oil prices have remained stable for years. Jack Farchy, commodities correspondent, suggests to John Authers that this has been due to reduced supply in countries like Libya and Iran, and that prices could easily fall in 2014.

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U.A.E. Nears Debt Listing Rules to Boost Sales: Islamic Finance - Bloomberg

U.A.E. Nears Debt Listing Rules to Boost Sales: Islamic Finance - Bloomberg:

"The United Arab Emirates is in the final stages of creating debt issuance and listing regulations that will help develop a domestic credit market and encourage the sale of Islamic bonds, the market regulator said.

The Securities and Commodities Authority, or SCA, has circulated draft rules that for the first time treat sukuk and non-Shariah compliant debt separately. The regulator is seeking feedback from market participants by the end of the year and “hopes” to enact the regulations early in 2014, according to Obaid Al Zaabi, director of research and development at SCA.

The U.A.E., the second-biggest Arab economy, must develop local debt markets to help state-run and private companies find alternatives to bank loans, Central Bank Governor Sultan Al-Suwaidi said last month. The country is the only one in the six-nation Gulf Cooperation Council that doesn’t have a domestic, local-currency debt market."

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BP signs deal to develop $16 billion Oman shale gas project | Reuters

BP signs deal to develop $16 billion Oman shale gas project | Reuters:

"BP has signed 30-year gas production sharing and sales deals to develop Oman's Khazzan tight gas project at an estimated investment of $16 billion, the UK energy giant and Omani government announced on Monday.

The Khazzan gas project, which aims to extract around one billion cubic feet (bcf) per day of gas from deep under central Oman, is a showcase for BP's tight gas extraction technology and its success is vital for Oman's economy.

"Today's signing is an important step in the Sultanate of Oman's plans to meet growing demand for energy over the coming decades and to contribute to economic development in Oman," Oman oil and gas minister, Mohammed Al Rumhy, said in a statement after the signing in Muscat.

"The Khazzan project is the largest new upstream project in Oman and a pioneering development in the region in unlocking technically challenging tight gas through technology.""

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Bahrain opposition calls for inquiry into aluminium producer - FT.com

Bahrain opposition calls for inquiry into aluminium producer - FT.com:

"Bahrain’s opposition has called for an independent investigation into state-run Aluminium Bahrain (Alba) after a corruption trial collapsed in London last week.
Al-Wefaq, which has been at the forefront of protests in Bahrain, says losses to the public purse should be investigated by the government.
“The Bahraini people lost money,” said Abdul Jalil Khalil, a Wefaq spokesman. “We need an independent investigation here in Bahrain to look into this as we are talking about more than $3bn – this is not an easy figure.”"

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Gulf Union: Oman’s Refusal Calls For Soul-Searching - OpEd Eurasia Review

Gulf Union: Oman’s Refusal Calls For Soul-Searching - OpEd Eurasia Review:

"
Over the reports of a Gulf Union cooking in the oven, Oman made it loud and clear: We are not part of this.

Citizens of the GCC countries, particularly Saudis, are in a state of shock and bewilderment over the Omani response. Many believe that Oman has the right to choose whatever is in its larger interest.

However, there are some who are in a state of denial, as they did not expect such a response from their otherwise quiet neighbor.

Interestingly, both sides agree on one point at least that Oman is different; it is Omanis and not us who need to change and cope with that change."

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Saudi Gazette - MENA economies set to grow in ’14

Saudi Gazette - MENA economies set to grow in ’14:

"The majority of MENA economies are expected to grow over the next year partially owing to higher oil production, according to asset manager PineBridge Investments.

“We expect economic growth across the region will increase moderately during the year, helped in part by higher oil production and concur with the IMF’s forecast of 3.8 percent real GDP growth for 2014 (up from 2.1 percent in 2013),” said Talal Al Zain, chief executive officer of PineBridge Investments Middle East.

“In the longer term, a growing young population, increasing consumption and rising budget expenditure should overcome policy challenges in many of these countries, creating promising conditions for investment.”"

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Free to leave Dubai after four years: Ex-Nakheel executive cleared in Dh44m fraud case gets passport back | The National

Free to leave Dubai after four years: Ex-Nakheel executive cleared in Dh44m fraud case gets passport back | The National:

"A former Nakheel executive who spent more than four years under house arrest for a crime he did not commit was given his passport back on Sunday.

Marcus Lee was accused of trying to pocket Dh44 million by fraudulently selling a piece of the collapsed Dubai Waterfront project but was cleared of any wrongdoing in May.

The return of his passport from the authorities is the final confirmation that there will be no further appeals in the case.

Mr Lee, 44, and his wife Julie can now return to their home in Sydney, Australia."

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Tommy Weir: beware the suitcase brigade after Expo 2020 victory | The National

Tommy Weir: beware the suitcase brigade after Expo 2020 victory | The National:

"Watch out, here they come. Who, you may ask? Well, the suitcase brigade is arriving on our shores – more accurately our airport runways.

The UAE is a bright spot in the global economy and now with the spotlight firmly on us thanks to Expo 2020, we are shining even brighter. Naturally this is attracting prospectors looking for a quick gain.

Just weeks before the Expo 2020 vote I was sitting in the Vault at the Marriott Marquis doing what my mum tried to teach me not to do — eavesdropping. The conversation at the next table pulled me in when one member of the suitcase brigade said to another: “They have no idea what they [referring to the current business leaders in Dubai] are doing.”"

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Expo 2020 and Dubai property boost for UAE banks | The National

Expo 2020 and Dubai property boost for UAE banks | The National:

"UAE banks are forecast to report improved earnings for 2013 on the back of Dubai’s improving property sector as well as its Expo win last month.

The local investment bank Arqaam Capital said yesterday it had raised its growth forecast for banks’ earnings per share to 15.8 per cent for 2013, with further growth of 10.2 per cent forecast for next year.

The higher forecasts reflect both general economic recovery, in particular Dubai real estate, and efforts by banks to clean up balance sheets and diversify their asset mixes."

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Shares in Dubai developer Emaar rise despite announcement of prospective bonds conversion | The National

Shares in Dubai developer Emaar rise despite announcement of prospective bonds conversion | The National:

"Emaar convertible bond holders have asked the company to turn them into shares amid improving property market sentiment.

Shares of Emaar Properties rose slightly yesterday despite the prospect of dilution of shareholder equity.

The property company, which developed Burj Khalifa, said holders of its convertible bonds issued three years ago had asked to convert their investments into shares."

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Al Rajhi Capital closes real estate fund | GulfNews.com

Al Rajhi Capital closes real estate fund | GulfNews.com:

"Al Rajhi Capital, one of the largest investment firms in Saudi Arabia, has successfully closed its second real estate income-generating fund, with total equity of 678 million Saudi riyals, surpassing the fund’s original target of 500 million riyal.
The five-year closed-ended fund will invest in income generating properties, such as warehouses, community retail centres and other types of properties occupied by solid tenants with long-term leases.
The objective of the fund is to provide its investors superior returns with balanced risk, bi-annually distributed current income, in addition to a potential for capital appreciation."

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Corporate governance the key to unlocking Capital Markets in the GCC | GulfNews.com

Corporate governance the key to unlocking Capital Markets in the GCC | GulfNews.com:

"It has been over five years since the collapse of Lehman Brothers, but the financial crisis continues to cast a long shadow over the global economy. In a stubbornly weak global economic environment, the development of Capital Markets in the GCC remains vital for catalysing future growth. In turn, more robust corporate governance in the region holds the key to unlocking the development of Capital Markets. So in effect, it is lagging corporate governance that is holding back economic growth.
Many believe that Capital Markets can create a virtuous circle of sustainable economic growth. Deeper and more liquid Capital Markets with regular bond issuances and benchmark sovereign yield curves facilitate capital market access for corporate borrowers and enable corporates to confidently access the bond and Sukuk markets, diversifying their funding sources and attracting foreign investment. In addition, the bond markets increasingly satisfy corporate funding requirements, enabling banks to target new business opportunities and reopen conventional funding channels, financing enhanced corporate growth as a result."

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Al Ramz authorised to perform direct market access with DFM | GulfNews.com

Al Ramz authorised to perform direct market access with DFM | GulfNews.com:

"Al Ramz Securities, a leading UAE brokerage house, has announced that it has received accreditation to conduct Direct Market Access (DMA) under the Dubai Financial Market (DFM).
Professional and international investors can now trade directly with DFM-listed companies through the Al Ramz web portal.
“Earning DFM’s DMA accreditation is indeed a great asset and adds significant value to our portfolio of services. It reflects our constant efforts to enhance our industry position and earn the trust of our valued clients. We assure our customers, partners and stakeholders that we shall continue to move forward and expand further in the local and regional markets,” said Abdul Hadi Al Saadi, Chief Operations Officer, Al Ramz Securities.
Al Ramz is the first brokerage house in the UAE to provide Islamic Margin Trading services."

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Gazprom Leads Eighth Weekly Drop on Oil: Russia Overnight - Bloomberg

Gazprom Leads Eighth Weekly Drop on Oil: Russia Overnight - Bloomberg:

"Russian stocks traded in New York are posting the longest stretch of weekly declines since June 2012 as OAO Gazprom (OGZPY) follows oil lower amid concern the Federal Reserve will cut U.S. monetary stimulus.

The Bloomberg Russia-US Equity Index of the most-traded Russian stocks in the U.S. fell 0.4 percent to 96.45 last week. American depositary receipts of Gazprom, Russia’s biggest company, sank 2.5 percent to a three-month low. Yandex NV (YNDX), the nation’s biggest Internet company, tumbled 4.3 percent after selling dollar bonds. OAO Rostelecom (ROSYY) posted the best week since Oct. 25 after the government approved the merger of its mobile assets into a joint venture with Tele2 Russia.

Russian stocks slumped in line with global equities as signs of improvement in the U.S. economy spurred speculation the Fed will rein in stimulus at this week’s policy meeting. Oil, Russia’s chief export earner, slid as falling demand boosted fuel inventories. Oil and natural gas account for about 50 percent of budget revenue in Russia."

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Emerging Stocks Fall to One-Month Low on China Factory Data - Bloomberg

Emerging Stocks Fall to One-Month Low on China Factory Data - Bloomberg:

"Emerging-market stocks dropped, dragging the benchmark gauge to a one-month low, after a survey showed Chinese manufacturing expanded less than estimated and investors weighed the timing of a cut in U.S. stimulus.

SAIC Motor Corp. (600104) sank 5.2 percent in Shanghai to lead losses for Chinese automakers as the city of Tianjin said it would limit issuance of car license plates. Wumart Stores Inc. (1025) tumbled to a four-year low in Hong Kong after saying plans to buy stores from CP Lotus Corp. (121) won’t proceed. Malaysia’s ringgit and the Thai baht rose 0.1 percent versus the dollar.

The MSCI Emerging Markets Index slid 0.2 percent to 988.94 as of 1:34 p.m. in Hong Kong, its fifth day of declines. A Chinese manufacturing index unexpectedly fell to a three-month low, suggesting the world’s second-largest economy is vulnerable to a slowdown. The Federal Reserve may begin reducing its $85 billion of monthly bond purchases at its Dec. 17-18 meeting, according to 34 percent of economists in a Dec. 6 Bloomberg survey, up from 17 percent in a Nov. 8 poll."

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Libya’s Eastern Oil Ports Will Stay Shut, Capping Oil Sales - Bloomberg

Libya’s Eastern Oil Ports Will Stay Shut, Capping Oil Sales - Bloomberg:

"A Libyan rebel leader refused to hand over control of three oil ports to the government, keeping a lid on the North African nation’s crude sales in a development that may buoy the price of the fuel.

Ibrahim Al Jedran told a news conference yesterday that the oil export terminals of Es Sider, Ras Lanuf and Zueitina, closed since the end of July, will remain shut after the authorities rejected his conditions, including a demand to share oil revenue with his self-proclaimed government in the east.

“We failed in making our conditions implemented, so we confirm that we won’t open the oil ports,” he said, speaking in the eastern city of Ajdabiya. “We now officially mandate the Executive Bureau of the Cyrenaica Region to start what it has been tasked with and preserve this wealth,” he said, signaling that the eastern region known as Cyrenaica may sell oil without the government’s approval."

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Kuwait May Impose Corporate Income Tax on National Companies - Bloomberg

Kuwait May Impose Corporate Income Tax on National Companies - Bloomberg:

"Kuwait’s finance ministry is preparing a proposal to impose income tax on “national firms” to help boost government revenue, Finance Minister Sheikh Salem AbdulAziz Al-Sabah said.

“The government may adopt proposals to extend the current corporate income tax to include Kuwaiti firms besides the foreign firms,” Sheikh Salem said in an e-mailed response to questions. The ministry is also coordinating with authorities in the Gulf Cooperation Council “for the development of the value added tax, which has seen good progress so far.”

The plan to tax Kuwaiti companies, if adopted by the government, would require parliament approval. Foreign companies in Kuwait pay a 15 percent tax."

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