Saudi Gazette - Qantas is in ‘junk’ status:
"Embattled Australian carrier Qantas’ credit rating was downgraded by Standard & Poor’s to “junk” status Friday after the airline issued a shock profit warning and slashed jobs.
Qantas on Thursday flagged a half-year loss of up to Aus$300 million (US$271 million) and said it would axe 1,000 jobs as it struggles under the weight of record fuel costs and fierce competition from subsidised rivals.
In response, S&P lowered cut the airline’s rating from BBB-, the lowest investment grade, to BB+ and placed it on a creditwatch with negative implications.
That puts Qantas in what is known as “junk” status among professionals, increasing the cost of financing for the carrier and restricting access to investors that do not put their money in lower rated companies."
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Saturday, 7 December 2013
Ukraine Company Bond Rout Woos Landesbank Berlin to Otkritie - Bloomberg
Ukraine Company Bond Rout Woos Landesbank Berlin to Otkritie - Bloomberg:
"Ukrainian corporate bonds yielding at least double emerging-market peers are luring investors from Landesbank Berlin Investment GmbH to Otkritie Capital on speculation the selloff triggered by street protests will fade.
Yields on state-owned NAK Naftogaz Ukrainy’s notes due in September have dropped 0.95 percentage point in the past two days to 19.63 percent. They had surged 2.62 percentage points in the two weeks since Ukraine’s worst protests in a decade broke out and sparked the biggest bond slump in emerging markets. Yields on poultry producer MHP SA’s bonds due in 2020 are down 44 basis points since reaching a record 13.15 percent on Dec. 4.
Landesbank Berlin bought Naftogaz bonds while Moscow-based Otkritie recommended the notes and Pioneer Investments said it’s looking for buying opportunities. The investments are a bet that President Viktor Yanukovych will cobble together enough foreign aid to stem a 51 percent plunge in foreign reserves in the past 2-1/2 years and meet debt payments after his decision to suspend trade talks with the European Union sparked the demonstrations."
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"Ukrainian corporate bonds yielding at least double emerging-market peers are luring investors from Landesbank Berlin Investment GmbH to Otkritie Capital on speculation the selloff triggered by street protests will fade.
Yields on state-owned NAK Naftogaz Ukrainy’s notes due in September have dropped 0.95 percentage point in the past two days to 19.63 percent. They had surged 2.62 percentage points in the two weeks since Ukraine’s worst protests in a decade broke out and sparked the biggest bond slump in emerging markets. Yields on poultry producer MHP SA’s bonds due in 2020 are down 44 basis points since reaching a record 13.15 percent on Dec. 4.
Landesbank Berlin bought Naftogaz bonds while Moscow-based Otkritie recommended the notes and Pioneer Investments said it’s looking for buying opportunities. The investments are a bet that President Viktor Yanukovych will cobble together enough foreign aid to stem a 51 percent plunge in foreign reserves in the past 2-1/2 years and meet debt payments after his decision to suspend trade talks with the European Union sparked the demonstrations."
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Azeri State Oil Fund to Reduce Euro Holdings for Aussie, Stocks - Bloomberg
Azeri State Oil Fund to Reduce Euro Holdings for Aussie, Stocks - Bloomberg:
"Azerbaijan’s State Oil Fund will cut the share of euros in its holdings in favor of the Australian dollar, Russian ruble and Turkish lira, while planning to increase investments in real estate to diversify its assets.
The fund will reduce the share of euros to 35 percent of its investment portfolio from 40 percent, Jamala Aliyeva, a spokeswoman for Sofaz, as it’s called, said today by e-mail. The combined share of Australian dollar, Russian ruble and Turkish lira holdings will rise to 10 percent from 5 percent, she said.
Sofaz allocates 50 percent of its foreign-exchange holdings to the U.S. dollar and 5 percent to the British pound.
Created in 1999 to manage the Caspian Sea nation’s income from the sale of oil and natural gas, Sofaz had $35.8 billion of assets as of Oct. 1. The fund has about $1 billion earmarked for commercial real estate in Australia and Asian countries including South Korea, Japan, Singapore and China, Sofaz Deputy Executive Director Israfil Mammadov said in October."
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"Azerbaijan’s State Oil Fund will cut the share of euros in its holdings in favor of the Australian dollar, Russian ruble and Turkish lira, while planning to increase investments in real estate to diversify its assets.
The fund will reduce the share of euros to 35 percent of its investment portfolio from 40 percent, Jamala Aliyeva, a spokeswoman for Sofaz, as it’s called, said today by e-mail. The combined share of Australian dollar, Russian ruble and Turkish lira holdings will rise to 10 percent from 5 percent, she said.
Sofaz allocates 50 percent of its foreign-exchange holdings to the U.S. dollar and 5 percent to the British pound.
Created in 1999 to manage the Caspian Sea nation’s income from the sale of oil and natural gas, Sofaz had $35.8 billion of assets as of Oct. 1. The fund has about $1 billion earmarked for commercial real estate in Australia and Asian countries including South Korea, Japan, Singapore and China, Sofaz Deputy Executive Director Israfil Mammadov said in October."
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Ukraine Spared the EU and Itself - Bloomberg
Ukraine Spared the EU and Itself - Bloomberg:
"Much has been said about the defeat the European Union suffered with Ukraine’s sudden refusal to sign a trade and association agreement. The contrary is true: The EU has had a lucky escape and so have the Ukrainian people.
Ukraine has a dysfunctional economy that faces imminent default. It cannot afford another destabilizing revolution. Rather than make a grand geostrategic choice between East and West, the country needs round-table talks similar to the ones that helped bring about a peaceful end to communism in Poland in 1989. These negotiations should resolve Ukraine’s political logjam and reach agreement on reforms to resuscitate the economy.
The to-do list for Ukraine has been known for a long time: a functioning democracy and a market economy with firm and transparent rules. Yet there has been no political will to take the steps required, because doing so would endanger the vested interests of too many of Ukraine’s political leaders and business leaders. Short of a miracle, Ukraine will continue muddling its way down."
'via Blog this'
"Much has been said about the defeat the European Union suffered with Ukraine’s sudden refusal to sign a trade and association agreement. The contrary is true: The EU has had a lucky escape and so have the Ukrainian people.
Ukraine has a dysfunctional economy that faces imminent default. It cannot afford another destabilizing revolution. Rather than make a grand geostrategic choice between East and West, the country needs round-table talks similar to the ones that helped bring about a peaceful end to communism in Poland in 1989. These negotiations should resolve Ukraine’s political logjam and reach agreement on reforms to resuscitate the economy.
The to-do list for Ukraine has been known for a long time: a functioning democracy and a market economy with firm and transparent rules. Yet there has been no political will to take the steps required, because doing so would endanger the vested interests of too many of Ukraine’s political leaders and business leaders. Short of a miracle, Ukraine will continue muddling its way down."
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