How Qatar became Europe’s top power-broker:
"When in distress, American banks call Warren Buffett. In Europe, banks have turned instead to the Middle Eastern principality of Qatar.
This one-time impoverished British protectorate famous only for pearl-fishing may only be the size of Yorkshire – but Qatar's swoop on Deutsche Bank confirms its role as Europe's number one power-broker, having struck similar deals with Barclays, Credit Suisse, Dexia, KBL and Greece's Alpha Bank."
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Wednesday, 21 May 2014
Undervalued Russian Stocks Promise Either Windfall or Disaster to Bold Investors | News | The Moscow Times
Undervalued Russian Stocks Promise Either Windfall or Disaster to Bold Investors | News | The Moscow Times:
"Foreign participants of the St. Petersburg International Economic Forum should give the Russian stock market a closer look. According to analysts, Russian companies are now massively undervalued, presenting a huge opportunity to investors brave enough to grab it.
"Russian stocks are currently trading cheaper than half of their book net asset value, levels not seen even in troubled Egypt," said Martin Graham, chairman of London-based Oracle Capital Group and former head of the London Stock Exchange's AIM international market.
There seem to be more reasons than ever to avoid Russian stocks — Russia's confrontation with the West over Ukraine risks spilling over into damaging sector-wide economic sanctions; Russian growth has stalled to near zero; and the old bugbears of corruption, arbitrary courts and poor corporate governance have gone nowhere. But given the incredibly low price of Russian stocks, logic may in fact err on the side on investing.
Take state-controlled gas firm Gazprom, Russia's biggest company. Releasing its IFRS financial statements for 2013 last month, Gazprom said it had surpassed China's Petrochina and the U.S.' ExxonMobil and Apple to become the most profitable company in the world by EBITDA, earning a little over 2 trillion rubles ($58 billion) last year."
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"Foreign participants of the St. Petersburg International Economic Forum should give the Russian stock market a closer look. According to analysts, Russian companies are now massively undervalued, presenting a huge opportunity to investors brave enough to grab it.
"Russian stocks are currently trading cheaper than half of their book net asset value, levels not seen even in troubled Egypt," said Martin Graham, chairman of London-based Oracle Capital Group and former head of the London Stock Exchange's AIM international market.
There seem to be more reasons than ever to avoid Russian stocks — Russia's confrontation with the West over Ukraine risks spilling over into damaging sector-wide economic sanctions; Russian growth has stalled to near zero; and the old bugbears of corruption, arbitrary courts and poor corporate governance have gone nowhere. But given the incredibly low price of Russian stocks, logic may in fact err on the side on investing.
Take state-controlled gas firm Gazprom, Russia's biggest company. Releasing its IFRS financial statements for 2013 last month, Gazprom said it had surpassed China's Petrochina and the U.S.' ExxonMobil and Apple to become the most profitable company in the world by EBITDA, earning a little over 2 trillion rubles ($58 billion) last year."
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Russia-China Gas Deal Signed to Applause — and Skepticism | News | The Moscow Times
Russia-China Gas Deal Signed to Applause — and Skepticism | News | The Moscow Times:
"Hours after the long-anticipated signing of a 30-year multibillion dollar gas deal on Wednesday between Russia's Gazprom and China's National Petroleum Corporation, analysts poked holes in President Vladimir Putin's touting of the deal as a political triumph and a "milestone event," saying it would barely be profitable for the Russian corporation.
Gazprom CEO Alexei Miller declined to reveal the price per cubic meter of gas under the contract, calling it a trade secret, but judging by the overall volume and price of the deal — $400 billion for 38 billion cubic meters a year for 30 years — it would boil down to around $350 per thousand cubic meters.
"This is the biggest contract in the history of the gas sector of the former USSR," Putin said after the signing of the agreement in Shanghai during a meeting with Chinese President Xi Jinping, Reuters reported.
"Our Chinese friends are difficult, hard negotiators," he said."
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"Hours after the long-anticipated signing of a 30-year multibillion dollar gas deal on Wednesday between Russia's Gazprom and China's National Petroleum Corporation, analysts poked holes in President Vladimir Putin's touting of the deal as a political triumph and a "milestone event," saying it would barely be profitable for the Russian corporation.
Gazprom CEO Alexei Miller declined to reveal the price per cubic meter of gas under the contract, calling it a trade secret, but judging by the overall volume and price of the deal — $400 billion for 38 billion cubic meters a year for 30 years — it would boil down to around $350 per thousand cubic meters.
"This is the biggest contract in the history of the gas sector of the former USSR," Putin said after the signing of the agreement in Shanghai during a meeting with Chinese President Xi Jinping, Reuters reported.
"Our Chinese friends are difficult, hard negotiators," he said."
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Russia’s Gazprom suffers dual non-payment bind – beyondbrics - Blogs - FT.com
Russia’s Gazprom suffers dual non-payment bind – beyondbrics - Blogs - FT.com:
"As Gazprom pressures Ukraine to settle its $3.5bn gas arrears, Russian gas consumers have also been running up multi-billion dollar debts. At a time when Russia’s economy is faltering, it might be difficult for Gazprom to get them to pay up.
Gazprom’s customers owed Rbs115.8bn ($3.35bn) for gas at the end of 2013, almost 40 per cent more than on December 31st 2012, Kirill Seleznev, director general of Mezhregiongaz, Gazprom’s gas distribution subsidiary, told reporters in Moscow this week.
Domestic buyers have continued to fall behind on payments this year, with total debts rising to Rbs 141.6bn ($4.1bn) in the first quarter of 2014, he said.
Debt problems were most acute in Russia’s impoverished North Caucasus, where law enforcers are battling an Islamic insurgency. Consumers in more prosperous European Russia, including the Moscow, Vladimir and Bryansk regions, were also falling further behind with gas payments than before."
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"As Gazprom pressures Ukraine to settle its $3.5bn gas arrears, Russian gas consumers have also been running up multi-billion dollar debts. At a time when Russia’s economy is faltering, it might be difficult for Gazprom to get them to pay up.
Gazprom’s customers owed Rbs115.8bn ($3.35bn) for gas at the end of 2013, almost 40 per cent more than on December 31st 2012, Kirill Seleznev, director general of Mezhregiongaz, Gazprom’s gas distribution subsidiary, told reporters in Moscow this week.
Domestic buyers have continued to fall behind on payments this year, with total debts rising to Rbs 141.6bn ($4.1bn) in the first quarter of 2014, he said.
Debt problems were most acute in Russia’s impoverished North Caucasus, where law enforcers are battling an Islamic insurgency. Consumers in more prosperous European Russia, including the Moscow, Vladimir and Bryansk regions, were also falling further behind with gas payments than before."
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About that Deutsche Bank capital… | FT Alphaville
About that Deutsche Bank capital… | FT Alphaville:
"Gather round nerds, and hear the tale of Deutsche Bank’s mysterious new CoCo bonds.
It’s a tale that involves an €8bn capital raising anchored by the Qataris, some German accounting standards and one terrible cereal-based pun.
For those who don’t watch the capital markets obsessively, you may have been unaware when Deutsche Bank announced on April 28 that it planned to issue €1.5bn of a type of contingent capital known as additional tier 1 capital.
The sale of the CoCo bonds was supposed to price last week but did not. Since this was before Deutsche’s weekend’s announcement of the capital raising, there was a lot of speculation (A LOT!) as to what had happened to the offer."
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"Gather round nerds, and hear the tale of Deutsche Bank’s mysterious new CoCo bonds.
It’s a tale that involves an €8bn capital raising anchored by the Qataris, some German accounting standards and one terrible cereal-based pun.
For those who don’t watch the capital markets obsessively, you may have been unaware when Deutsche Bank announced on April 28 that it planned to issue €1.5bn of a type of contingent capital known as additional tier 1 capital.
The sale of the CoCo bonds was supposed to price last week but did not. Since this was before Deutsche’s weekend’s announcement of the capital raising, there was a lot of speculation (A LOT!) as to what had happened to the offer."
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MIDEAST STOCKS-Dubai in biggest gain in 8 mths; property leads rebound | Reuters
MIDEAST STOCKS-Dubai in biggest gain in 8 mths; property leads rebound | Reuters:
"Property-related stocks led gains as Dubai's index rallied from a six-week intraday low in its largest one-day advance since mid-September on Wednesday, while Egypt eased from a 69-month peak.
Dubai's benchmark rose 4.2 percent. It had lost 12.6 percent in the previous five sessions and fell a further 2.4 percent intraday before rebounding. The measure is now up 43.9 percent this year and has tripled since the start of 2013.
"The sell-off was expected but exaggerated - the decline in the prices on many of the heavyweight stocks increased investors' appetite to buy on dips," said Firass Yaish, business development manager at One Financial Markets in Dubai.
"Volatility is still the name of the game and we need to keep in check the rising PE (price to earnings ratios) of most of the stocks listed on the DFM (Dubai Financial Market).""
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"Property-related stocks led gains as Dubai's index rallied from a six-week intraday low in its largest one-day advance since mid-September on Wednesday, while Egypt eased from a 69-month peak.
Dubai's benchmark rose 4.2 percent. It had lost 12.6 percent in the previous five sessions and fell a further 2.4 percent intraday before rebounding. The measure is now up 43.9 percent this year and has tripled since the start of 2013.
"The sell-off was expected but exaggerated - the decline in the prices on many of the heavyweight stocks increased investors' appetite to buy on dips," said Firass Yaish, business development manager at One Financial Markets in Dubai.
"Volatility is still the name of the game and we need to keep in check the rising PE (price to earnings ratios) of most of the stocks listed on the DFM (Dubai Financial Market).""
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Qatar's CBQ, Doha Bank may raise new capital in 2015 - analyst | Reuters
Qatar's CBQ, Doha Bank may raise new capital in 2015 - analyst | Reuters:
"Commercial Bank of Qatar (CBQ) and Doha Bank may need to increase their capital next year by $412 million each to abide by expected central bank regulations, U.S. investment bank Morgan Stanley said in a report.
While Qatari banks have formally adopted Basel 3 international regulations as of early this year, the investment bank expects Qatar's central bank to impose higher capital requirements that could go up to 16 percent of risk-weighted assets in 2019.
Qatari banks will choose to raise capital, rather than curtail growth or cut dividends to zero, and might also look at further overseas expansions to beat limited growth prospects in a country of 1.7 million people, the report said."
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"Commercial Bank of Qatar (CBQ) and Doha Bank may need to increase their capital next year by $412 million each to abide by expected central bank regulations, U.S. investment bank Morgan Stanley said in a report.
While Qatari banks have formally adopted Basel 3 international regulations as of early this year, the investment bank expects Qatar's central bank to impose higher capital requirements that could go up to 16 percent of risk-weighted assets in 2019.
Qatari banks will choose to raise capital, rather than curtail growth or cut dividends to zero, and might also look at further overseas expansions to beat limited growth prospects in a country of 1.7 million people, the report said."
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Gas Prices for China Tied to Oil Prices – Putin | Russia | RIA Novosti
Gas Prices for China Tied to Oil Prices – Putin | Russia | RIA Novosti:
"SHANGHAI, May 21 (RIA Novosti) – The price for gas under a deal signed Wednesday between Russian gas giant Gazprom and China’s CNPC is tied to the market price of oil and oil products and is satisfactory to both parties, Russian President Vladimir Putin said Wednesday.
Earlier in the day, Gazprom and CNPC signed the 30-year contract on the sale of Russian gas to China at a volume of 38 billion cubic meters per year via an eastern route.
The document was under discussion for several years with the main stumbling block being the gas price, which the parties finally agreed on at the last minute.
Gazprom CEO Alexei Miller declined to name the contract price for gas, saying it was a "commercial secret." He did, however, say that the cost of the entire contract was $400 billion, which if calculated against the total flows, comes to about $350 per 1,000 cubic meters."
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"SHANGHAI, May 21 (RIA Novosti) – The price for gas under a deal signed Wednesday between Russian gas giant Gazprom and China’s CNPC is tied to the market price of oil and oil products and is satisfactory to both parties, Russian President Vladimir Putin said Wednesday.
Earlier in the day, Gazprom and CNPC signed the 30-year contract on the sale of Russian gas to China at a volume of 38 billion cubic meters per year via an eastern route.
The document was under discussion for several years with the main stumbling block being the gas price, which the parties finally agreed on at the last minute.
Gazprom CEO Alexei Miller declined to name the contract price for gas, saying it was a "commercial secret." He did, however, say that the cost of the entire contract was $400 billion, which if calculated against the total flows, comes to about $350 per 1,000 cubic meters."
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Russia and China seal historic multibillion gas deal — RT Business
Russia and China seal historic multibillion gas deal — RT Business:
"After 10 years of negotiations, Russia's Gazprom and China's CNPC have finally signed a historic gas deal which will provide the world's fastest growing economy with the natural gas it needs to keep pace for the next 30 years.
The contract was signed by the heads of Russia's Gazprom and China National Petroleum Corporation (CNPC) on the second day of Russian President Vladimir Putin’s two-day state visit to Shanghai.
Under the long-term deal, Gazprom will begin providing China's growing economy with 38 billion cubic meters of natural gas per year for the next 30 years, beginning in 2018. The details of the deal were discussed for more than 10 years, with Moscow and Beijing negotiating over gas prices and the pipeline route, as well as possible Chinese stakes in Russian projects."
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"After 10 years of negotiations, Russia's Gazprom and China's CNPC have finally signed a historic gas deal which will provide the world's fastest growing economy with the natural gas it needs to keep pace for the next 30 years.
The contract was signed by the heads of Russia's Gazprom and China National Petroleum Corporation (CNPC) on the second day of Russian President Vladimir Putin’s two-day state visit to Shanghai.
Under the long-term deal, Gazprom will begin providing China's growing economy with 38 billion cubic meters of natural gas per year for the next 30 years, beginning in 2018. The details of the deal were discussed for more than 10 years, with Moscow and Beijing negotiating over gas prices and the pipeline route, as well as possible Chinese stakes in Russian projects."
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Russia's Rosneft May Buy Switzerland's Gunvor Energy Trader - Paper | Business | RIA Novosti
Russia's Rosneft May Buy Switzerland's Gunvor Energy Trader - Paper | Business | RIA Novosti:
"MOSCOW, May 21 (RIA Novosti) — As the Swiss energy trader Gunvor prepares for sale, it holds talks with several potential buyers, including oil companies, and Russian giant Rosneft in particular, Russian daily Kommersant wrote on Wednesday citing market sources.
Gunvor assets were offered for sale in May, and some candidates are considering buying the entire company, the sources said. The discussed price is around $5 billion.
The sources, close to Gunvor's former partner Gennady Timchenko said the company was looking to attract partners, "and naturally, it is considering Rosneft."
Gunvor denied it was searching for buyers. Rosneft said it had no offers from the Swiss company. Sources in two other Russian energy companies Gazprom and LUKOIL said Gunvor was likely outside of their interest."
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"MOSCOW, May 21 (RIA Novosti) — As the Swiss energy trader Gunvor prepares for sale, it holds talks with several potential buyers, including oil companies, and Russian giant Rosneft in particular, Russian daily Kommersant wrote on Wednesday citing market sources.
Gunvor assets were offered for sale in May, and some candidates are considering buying the entire company, the sources said. The discussed price is around $5 billion.
The sources, close to Gunvor's former partner Gennady Timchenko said the company was looking to attract partners, "and naturally, it is considering Rosneft."
Gunvor denied it was searching for buyers. Rosneft said it had no offers from the Swiss company. Sources in two other Russian energy companies Gazprom and LUKOIL said Gunvor was likely outside of their interest."
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Kuwait Emir’s Tehran Trip to Mark ‘New Page’ in Ties, Iran Says - Bloomberg
Kuwait Emir’s Tehran Trip to Mark ‘New Page’ in Ties, Iran Says - Bloomberg:
"Kuwait’s ruler will travel to Tehran in two weeks, the Iranian foreign ministry said today, signaling a further thaw between the Persian Gulf country and Gulf Cooperation Council states.
Sheikh Sabah Al-Ahmed Al-Sabah’s will visit Iran on May 31-June 1 at the invitation of Iranian President Hassan Rouhani, Foreign Ministry spokeswoman Marzieh Afkham told reporters in Tehran today. The visit will mark “a new page” in relations between Kuwait and Iran, she said. It will be the first time Sheikh Sabah visits Iran since becoming Kuwait’s emir in 2006, the state-run Iranian Students News Agency said.
Rouhani, who was inaugurated in August, has called for more engagement with all nations, in particular regional neighbors. The Kuwaiti emir’s trip to Iran comes on the heels of a May 13 announcement that Saudi Arabia has invited Iranian Foreign Minister Mohammad Javad Zarif to visit."
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"Kuwait’s ruler will travel to Tehran in two weeks, the Iranian foreign ministry said today, signaling a further thaw between the Persian Gulf country and Gulf Cooperation Council states.
Sheikh Sabah Al-Ahmed Al-Sabah’s will visit Iran on May 31-June 1 at the invitation of Iranian President Hassan Rouhani, Foreign Ministry spokeswoman Marzieh Afkham told reporters in Tehran today. The visit will mark “a new page” in relations between Kuwait and Iran, she said. It will be the first time Sheikh Sabah visits Iran since becoming Kuwait’s emir in 2006, the state-run Iranian Students News Agency said.
Rouhani, who was inaugurated in August, has called for more engagement with all nations, in particular regional neighbors. The Kuwaiti emir’s trip to Iran comes on the heels of a May 13 announcement that Saudi Arabia has invited Iranian Foreign Minister Mohammad Javad Zarif to visit."
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Traders hope Dubai Financial Market correction is a partial one | GulfNews.com
Traders hope Dubai Financial Market correction is a partial one | GulfNews.com:
"Market experts are asking themselves whether Dubai Financial Market’s loss of 14 per cent of its value over the past five trading days is a partial correction or a measured correction.
The DFM index closed on Tuesday at 4,655.71, 199.79 points (4.12 per cent) down on the previous day’s close.
If it is a partial correction, then the worst is likely over. If not, the market will see further declines.
“Until now I consider it a correction from the last ascent since March — since then we have gone from 3,800 to 5,400 without a correction, 1,600 points,” said technical analyst Osama Al Ashri. “If the market is correcting for this period, 4,600 is the support."
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"Market experts are asking themselves whether Dubai Financial Market’s loss of 14 per cent of its value over the past five trading days is a partial correction or a measured correction.
The DFM index closed on Tuesday at 4,655.71, 199.79 points (4.12 per cent) down on the previous day’s close.
If it is a partial correction, then the worst is likely over. If not, the market will see further declines.
“Until now I consider it a correction from the last ascent since March — since then we have gone from 3,800 to 5,400 without a correction, 1,600 points,” said technical analyst Osama Al Ashri. “If the market is correcting for this period, 4,600 is the support."
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Repsol Said to Seek $2 Bln LNG Plant Amid Ukraine Crisis - Bloomberg
Repsol Said to Seek $2 Bln LNG Plant Amid Ukraine Crisis - Bloomberg:
"Repsol SA (REP) is considering building a $2 billion plant on Canada’s Atlantic coast to export natural gas, as Europe seeks to reduce its dependence on Russia for the fuel, a person familiar with the matter said.
Spain’s biggest energy company would erect the facility at its existing Canaport LNG plant, which was designed to import liquefied natural gas and is underused. Repsol may include the export project when updating its strategic plan next year, according to the person, who asked not to be identified discussing a private matter.
The crisis in Ukraine 4,000 miles away may help Repsol justify investing more in a disappointing project that has already undergone a $1.3 billion writedown. The Group of Seven nations agreed to find new sources of energy to prevent Russia from using its oil and gas reserves as a “political weapon,” German Economy and Energy Minister Sigmar Gabriel said May 6."
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"Repsol SA (REP) is considering building a $2 billion plant on Canada’s Atlantic coast to export natural gas, as Europe seeks to reduce its dependence on Russia for the fuel, a person familiar with the matter said.
Spain’s biggest energy company would erect the facility at its existing Canaport LNG plant, which was designed to import liquefied natural gas and is underused. Repsol may include the export project when updating its strategic plan next year, according to the person, who asked not to be identified discussing a private matter.
The crisis in Ukraine 4,000 miles away may help Repsol justify investing more in a disappointing project that has already undergone a $1.3 billion writedown. The Group of Seven nations agreed to find new sources of energy to prevent Russia from using its oil and gas reserves as a “political weapon,” German Economy and Energy Minister Sigmar Gabriel said May 6."
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