A new year means a new beginning for many. The calendar year followed by the world indicates 1 January as the start of a new year. However, in a diverse country like India people follow different traditions each year.
For most Hindus, the New Year begins in the summer. However, in Gujarati and Marwari traditions, it starts in Diwali.
India’s stock markets are dominated by brokers belonging to these two communities. Hence, every year, Diwali assumes a special place for those in the stock market.
Here are few things to know about Muhurat trading:
· Stock exchanges would open for trading at 6 pm on 3 November 2013 for Muhurat trading. The session lasts for an hour and a half. Muhurat means an auspicious moment to start something new. This is a tradition for over 100 years on the Bombay Stock Exchange and the mostly Gujarati and Marwari stock broking community. The session marks the end of the traditional financial year and the beginning of the new one.
· People look at stock markets from a point of view of wealth creation. Stockbrokers execute token trades on behalf of their clients or their own account to mark the occasion. Stock exchanges and broker offices are decorated to seek blessings of Lakshmi, the goddess of wealth.
· Chopda or Sharda Puja is performed. ‘Chopda’ is an account book. On the New Year day, you close your previous year accounts and start writing your financial statements in a new book. However, since most stock brokers are corporatized, accounts are no longer maintained physically. They are in electronic format. Also, for most companies in the business, the financial year starts on 1 April.
· Typically, the trading activity on Muhurat trading is thin. Over the years, statistics from the Bombay Stock Exchange data (available since 1992) shows that the Sensex has ended in positive territory 7 out of 10 times. The average gain or loss is not more than one per cent. Transactions mostly have a sentimental value than any impact on the portfolio.This work is produced by Simplus Information Services Pvt Ltd. Customer engagement through content. Like this article? Click here for more articles from the same provider.
Sunday, 3 November 2013
Diwali brings cheer to markets in Braj Mandal
Agra/Mathura/Vrindavan, Nov 3 (IANS) Sri Krishna's land Braj, comprising Agra, Mathura, Vrindavan, Hathras and Aligarh districts, is on a new high this Diwali with markets flooded with gift packets and Chinese lights Sunday. The sweet shops are virtually swamped with demands for the large variety of sweets lining the sale-counters.
"The markets and the busy lanes are choked with people and vehicles. It's one massive traffic jam all over Agra," said advocate Rajvir Singh, grumbling after he had to return without purchasing anything from Raja ki Mandi market in Agra.
Even when there is no space for movement or parking, people are buying vehicles.
"God knows from where the money is coming and they all keep wailing about price rise and financial crunch," Rajvir Singh told IANS. Market reports in Agra said that in just two days before Diwali, sales of all products had crossed Rs.400 crore.
In Mathura, the main market from Dwarkadheesh Temple to Holi Gate is dazzling with lights and a striking range of consumer products are being attractively displayed to lure consumers.
Vrindavan is buzzing with intense emotional buildup as Sri Krishna's devotees not only from India but hordes of foreigners have been making a beeline to various religious sites associated with Sri Krishna folklore.
The Braj Chaurasi Kos Yatra, covering a distance of almost 200 km on foot around Mathura, with a record number of pilgrims this year, is on. The religious fervour in Goverdhan, the holy hill town, 25 km from Mathura, is at its peak with preparations for religious meal-ceremonies Annakoot and Chhappan Bhog in full swing.
District authorities in Mathura are particularly anxious after reports of a massive influx of pilgrims expected for the ritualistic Yamuna Snan on Yam Dwitiya Parva, two days after Diwali. Brothers and sisters jointly take a holy dip in the river to be free of the shackles of Yamraj whose sister is Yamuna.
Meanwhile, expecting a huge Diwali rush, the state-run roadways corporation has made additional arrangements for transportation, deploying hundreds of buses to ferry pilgrims between Agra, Mathura and Vrindavan on Diwali.
The market for jewellery, clothes and other consumer durables has picked up momentum after a dull start last week. Sweet and gift shops are working overtime.
This year there has been a great demand for home-made chocolates. A large number of women entrepreneurs have entered this field. The Agra jail's petha retail counter is also doing brisk business.
"One good reason for the upbeat market this time is that the festival falls in the first week when pockets are flush with salaries and additional incomes," explains Bankey Lal Maheswari of Sri Nath Textiles in Johri Bazar close to Agra Fort.
The tourist inflow is steady. "But the same day return (to Delhi) due to the Yamuna Expressway, has hit smaller hotels," says hotelier Sandeep Arora.
The Diwali momentum has also hit the smaller towns on the periphery.
"With rain gods smiling this year, the crops have been good and the prices of agricultural commodities have remained largely stable and profitable for the cultivators, which means more money in the kitty for Diwali purchases. Looks like everyone's going for new mobiles, electronic goods, even computers," says Shravan Kumar Singh, a social activist.
The only segment reporting dull business is real estate.
"Full page advertisements have been placed in local newspapers for flats and complexes from Vrindavan to Firozabad but the demand is just not there. All kinds of fancy schemes are latched to booking of flats but still buyers are hard to find," says real estate agent Vinod Kumar.
Himachal Pradesh to set up controlled atmosphere stores
Shimla, Nov 2 (IANS) The Himachal Pradesh government would soon set up controlled atmosphere stores to enable horticulturists earn more for their produce, Chief Minister Virbhadra Singh said Saturday.
Speaking at the closing ceremony of the 15th All India Volleyball and Kabbadi Championship at Kotkhai in Shimla district, he said the government was committed to the welfare of farmers and horticulturists.
"Despite bumper apple produce this year, the horticulturists could not reap the profits as desired," the chief minister said.
He said there was a need for strengthening the marketing network and adopt modern infrastructure.
"We are serious to take appropriate steps in this direction and would set up controlled atmosphere stores so that the produce may have longevity."
He said as the horticulturists sold majority of their produce in the markets of Delhi and other terminal markets in large quantity which resulted in surplus accumulation of apple in these markets, leading to low prices for their produce.
Singh said that besides heavy rains, the government had been successful in maintaining the roads in the apple belt especially the Theog-Hatkoti road.
He said that Theog-Hatkoti-Rohru road would be completed in two phases with financial assistance of the World Bank. The project would be completed in two years, he added.
Horticulture is a vital sector in the state's economy as it generates more than Rs.3,200 crore annual income.
Apple alone constitutes about 93 percent of the total fruit produce in the state.
Sensex scales new high on special Diwali trading
Mumbai, Nov 3 (IANS) The Indian equities markets key indices closed at record high in the special Diwali trading Sunday led by good buying support in auto, FMCG and oil and gas stocks.
The 30 scrip sensitive index S&P Sensex of the Bombay Stock Exchange (BSE), which opened at 21,278.08 points, ended the session at 21,239.36 points, up 0.20 percent or 42.55 points from its previous close at 21196.81 points.
This is the record closing high for the benchmark Sensex. The previous record high was 21196.81 points hit Friday.
The special session called Mahurat trading was organised to mark the beginning of Samvat year 2070, a new year according to Hindu calendar.
Nifty of the National Stock Exchange (NSE) also scaled a new closing high. Nifty ended the day 10.15 points higher at 6,317.35 points.
Chinese premier warns slowing growth raises job concerns
BEIJING (Reuters) - China's slowing growth poses a major challenge to job creation for the world's most populous nation and the country will need to achieve a "golden" balance between structural adjustment and growth, Premier Li Keqiang was quoted as saying on Sunday.
China's economy is set to grow at its slackest pace in 23 years in 2013, at 7.5 percent, as its export sales falter on fragile global demand.
The country's leaders have pledged deep economic reforms to shift away from an export-led economy to one more reliant on domestic consumption, while making it clear they will accept lower growth rates during the transformation. But Li said such a path would present challenges.
"China has already entered a new stage of development. To maintain a growth rate as rapid as in the past is not realistic, but development is the foundation to solving many problems," state media quoted Li as telling a recent meeting with business leaders.
"As a big country with 1.3 billion people, there is no certain pace of development that can cope with so many difficulties and problems, especially preserving jobs."
The premier added that China would need to find a "golden balancing point" between upgrading the economy and maintaining a reasonable growth rate to ensure further job creation.
China's leaders gather from November 9 to November 12 at a Communist Party plenum to discuss deepening reforms of the world's second largest economy.
Li told Chinese and foreign business leaders last week that China would further reform its government finances, financial markets and industry, among other areas.
(Reporting By Dominique Patton; Editing by Ron Popeski)
Sensex hits record high in Muhurat trading
MUMBAI (Reuters) - The BSE Sensex rose to a second consecutive record high in a special trading session on Sunday, led by gains in Indian Bank, Tata Motors and ONGC on expectations of better quarterly earnings, while strong foreign flows continued to boost sentiment.
Stock markets opened for a special 90-minute Muhurat session to mark the festival of Diwali, considered an auspicious time for Indians.
The Sensex has been propelled by foreign inflows of around $3.5 billion since the Federal Reserve unexpectedly delayed tapering of its monetary stimulus.
The index rose to a record high of 21,321.53, surpassing the previous all-time high set just on Friday. It closed up 0.2 percent.
Hindustan Petroleum Corporation Ltd and Indian Oil Corp rose 3-4 percent while banking stocks Corporation Bank , Dena Bank and Indian Bank rose 2.6-15 percent.
(Reporting by Swati Pandey; Editing by Robin Pomeroy)
Banks hope futuristic flagships can tempt new customers
By Lionel Laurent
VELIZY, France (Reuters) - Installation art, interactive walls and a robot doorman; the flagship branches of the world's top banks have come a long way from the iron grilles and potted plants of old.
To compete against online-only rivals and to attract a new generation of customers to branches, banks are installing sleek interiors and hi-tech gadgetry.
ATMs that read fingerprints, touch-screen desks to flick through your finances and videoconference units for expert advice are all on display at payments-technology firm Wincor Nixdorf's showroom in the Paris suburb of Velizy.
"Banks are investing a lot in their retail branches," said Steve Bousabata, head of Wincor's French banking services arm. "They want customers to come back."
The reason is clear: after years of relying on branches to drive retail revenue, European banks expect such networks to supply only 62 percent of sales by 2020 from today's average of 81 percent, according to Equinox Consulting.
Banks, especially those still nursing losses from the financial crisis, are under pressure to cut costs and are balancing the need to pare back branch networks by sprucing up select outlets.
But branches are still the first point of contact for many customers and are still the primary location for product sales like mortgages, new accounts and insurance, underlining the importance of upgrading them for a more tech-savvy generation.
The difficulty is knowing exactly what belongs in the branch of the future and what is better left behind.
"Are all the things we see in branches today going to be seen in branches tomorrow? I very much doubt that," said Mike Baxter, head of management consultancy Bain's Americas Financial Services practice.
"There's an awful lot of experimentation of stuff that turns out to be unsuccessful and uneconomic."
Flashy "bank of the future" branches mixing gadgetry with design similar to Apple's
They include lounge areas, giant interactive screens and other trimmings such as handbags for sale and pieces of art.
Gauging their success is tricky. BNP was willing to give data on its refurbished flagship branch near the Paris Opera - which three years ago was fitted with a wall covered in plants, iPads for customer use and a touch-screen desk - saying that footfall was up 40 percent and new clients up 25 percent.
Italy's Unicredit also said that footfall and new business were up at its newly revamped flagship branch in the Bulgarian capital of Sofia, which offers "welcoming scents" and a touch-screen wall. Visits are up by an average of 60 percent while loans and deposits have doubled, a spokeswoman said.
On the other hand, BNP has done away with some ideas that failed to click with consumers: it has scrapped the iPads and touch-screen desk in favour of an interactive wall.
Deutsche Bank and Barclays declined to give data on single branches.
More broadly, some 88 percent of bank executives view their flagship branches in main street areas as being "successful" in promoting brand awareness, according to a survey by Equinox.
ROBOT BANKERS
Beyond Europe, the experiments are even bolder.
In South Korea, where mobile banking has flourished faster than in the West, Hana Bank allows mobile users to transfer money to one another by physically "bumping" smartphones. Shinhan Bank has also introduced unmanned "smart" branch kiosks that communicate with handsets.
Commonwealth Bank of Australia is using a mobile app to drive mortgage sales by offering clients data on houses for sale, while BBVA's
Customers of the Washington D.C. branch of Carolina Premier Bank
Although some of these advances may prove too gimmicky or not functional enough to catch on, long-distance banking via videoconference is seen as a way to reduce branch staffing without hurting service, though customers still prefer a physical point of contact somewhere along the line.
"Mortgage specialists sitting at headquarters, connecting via videoconference to the relationship manager; that works," said Bain's head of global retail banking, Dirk Vater.
"But bank-to-consumer, with people sitting on the sofa using Skype and Facetime, has not been adopted yet. It will eventually ... But not yet."
Increased ATM functionality as used by Citibank Asia and more secure biometric readers are also promising, he added.
The ultimate question of whether to scrap the branch entirely is one that is not being considered, consultants said.
The preference is for a "hub-and-spoke" model that pools resources in urban areas and reduces smaller, rural branches.
While this may lead to more ambitious flagship outlets, it can create gaps for new competitors to fill: France's Nickel, which offers a low-cost current account, is creating a branch network with the country's 27,000 tobacconists.
"Even in developed markets, the death of branches is somewhat exaggerated," Ernst & Young wrote in a 2012 report.
"We will see further evolution of the branch experience from something that looks like a local government office ...(to) a hybrid between coffee shop and technology store." (Additional reporting by Steve Slater in London, Tsvetelia Tsolova in Sofia, Jackie Range in Sydney and Douwe Miedema in Washington; Editing by Carmel Crimmins and Giles Elgood)
Asian shares eke out slim gains, dollar holds firm
By Wayne Cole
SYDNEY (Reuters) - Asian stocks drifted higher on Monday in sluggish trade as investors chose discretion over valour ahead of central bank meetings in Europe and the always-critical U.S. payrolls report.
MSCI's broadest index of Asia-Pacific shares outside Japan was just a shade firmer at 479.92.
Japanese markets were closed for a holiday.
Modest gains in Hong Kong and Australia were countered by losses in South Korea. Australian shares edged up 0.1 percent as another domestic bank reported record profits.
"We are bullish going into next year, but it wouldn't surprise to see some sort of breather ... We think any pullback is going to be very shallow," said Martin Lakos, division director at Macquarie Bank, of the Australian market.
Major currencies were likewise quiet with the dollar still well supported in the wake of upbeat U.S. manufacturing data that stirred speculation the Federal Reserve might scale back its bond-buying in December, rather than in March as many in the market currently anticipate.
There are no less than four Fed officials speaking on Monday, starting with Fed Bank of Dallas President Richard Fisher in Sydney. Fed Governor Jerome Powell and the heads of the St. Louis and Boston Feds all appear later in the day.
The dollar index was holding firm at 80.691 having climbed to a six-week peak on Friday. It was also up on the yen at 98.76 and threatening a major chart target at 99.00.
The dollar fared best against the euro which was undermined by speculation the European Central Bank (ECB) would have to ease again given disappointing news on unemployment and a startlingly low reading of inflation.
The common currency was pinned at $1.3494 on Monday, well below its recent high of $1.3832. The ECB holds a policy meeting on Thursday and it will be under intense pressure to stimulate the economy.
"We expect the opening statement, and Q&A, to have a distinctly dovish tone," wrote analysts at RBC Capital Markets in a note to clients.
"For now, we think that the Governing Council will refrain from any immediate action, but we expect the downbeat tone of next week's meeting to lay the groundwork for a policy response over the next few months."
The Bank of England holds it policy meeting on Thursday and is expected to stay on hold following a run of improving economic data recently.
A bigger event for markets will be Friday's U.S. payrolls report which is expected to show a modest rise of just 125,000 in October, amid some uncertainty about the impact of the government shut down.
A soft report, and particularly any rise in the jobless rate, would lean against the Fed tapering in December.
Also of note will be the U.S. gross domestic product (GDP) due on Thursday, expected to show annualised growth of 1.9 percent in the third quarter, down from 2.5 percent the previous quarter.
All the talk of Fed tapering saw U.S. Treasury yields rise for a third straight session on Friday. Yields on the benchmark 10-year U.S. Treasury note jumped to 2.63 percent, leaving behind the week's low of 2.47 percent.
Cash Treasuries were not trading in Asia on Monday due to the Japanese holiday, but Treasury futures were 2 ticks lower.
In commodity markets, prices were held back by the bounce in the U.S. dollar. Spot gold was trading at $1,315.06 an ounce, having crumbled from a peak of $1,361.60 last week. Copper was a touch firmer at $7,251 a tonne.
Oil prices steadied following last week's losses as a firmer dollar and ample supplies outweighed concerns about a drop in Libyan crude exports.
Brent crude for December delivery was up 16 cents at $106.01 a barrel. U.S. oil for December delivery added 8 cents to $94.69.
(Additional reporting by Thuy Ong in Sydney; Editing by Eric Meijer)
Gold edges lower for sixth session on Fed stimulus worries
SINGAPORE (Reuters) - Gold eased for a sixth straight session on Monday to trade near two-week lows as renewed uncertainty over when the U.S. Federal Reserve will scale back its stimulus measures weighed on sentiment.
FUNDAMENTALS
* Spot gold fell 0.1 percent to $1,313.54 an ounce by 0014 GMT, after posting a near 3 percent weekly drop. It fell to a low of $1,305.69 on Friday - its lowest since October 17.
* A top Federal Reserve official said on Friday the U.S. labour market has recovered enough in the last 14 months to allow the central bank to reduce its bond-buying stimulus.
* Another official said inflation has to be higher before the Fed decides to scale back.
* The Fed's $85 billion monthly bond purchases have burnished gold's appeal as a hedge against inflation, boosting prices, but signs that the bank is nearing a tapering of the purchases have hurt prices this year.
* The U.S. Mint's American Eagle gold coin sales rose to a two-year high on Friday, lifting 2013 sales above the previous year's total and reflecting the consistently strong demand for physical bullion coins among retail investors.
* Hedge funds and money managers broadly raised bullish bets in futures and options of U.S. gold, silver and copper for the week ended October 22, a report by the Commodity Futures Trading Commission showed on Friday.
* For the top stories on metals and other news, click, or
MARKET NEWS
* Asian markets started the week on a sluggish note on Monday, while the euro languished at two-week lows.
(Reporting by A. Ananthalakshmi; Editing by Richard Pullin)
Mahurat Trading: 5 stocks to buy this Diwali
A new year means a new beginning for many. The calendar year followed by the world indicates 1 January as the start of a new year. However, in a diverse country like India people follow different traditions each year.
For most Hindus, the New Year begins in the summer. However, in Gujarati and Marwari traditions, it starts in Diwali.
India’s stock markets are dominated by brokers belonging to these two communities. Hence, every year, Diwali assumes a special place for those in the stock market.
For most Hindus, the New Year begins in the summer. However, in Gujarati and Marwari traditions, it starts in Diwali.
India’s stock markets are dominated by brokers belonging to these two communities. Hence, every year, Diwali assumes a special place for those in the stock market.
Here are few things to know about Muhurat trading:
· Stock exchanges would open for trading at 6 pm on 3 November 2013 for Muhurat trading. The session lasts for an hour and a half. Muhurat means an auspicious moment to start something new. This is a tradition for over 100 years on the Bombay Stock Exchange and the mostly Gujarati and Marwari stock broking community. The session marks the end of the traditional financial year and the beginning of the new one.
· People look at stock markets from a point of view of wealth creation. Stockbrokers execute token trades on behalf of their clients or their own account to mark the occasion. Stock exchanges and broker offices are decorated to seek blessings of Lakshmi, the goddess of wealth.
· Chopda or Sharda Puja is performed. ‘Chopda’ is an account book. On the New Year day, you close your previous year accounts and start writing your financial statements in a new book. However, since most stock brokers are corporatized, accounts are no longer maintained physically. They are in electronic format. Also, for most companies in the business, the financial year starts on 1 April.
· Typically, the trading activity on Muhurat trading is thin. Over the years, statistics from the Bombay Stock Exchange data (available since 1992) shows that the Sensex has ended in positive territory 7 out of 10 times. The average gain or loss is not more than one per cent. Transactions mostly have a sentimental value than any impact on the portfolio.
Diwali is the time of the year when investors review their investments. They shuffle the stock portfolio based on their assessment for the year gone by and the road ahead. Various brokerage firms give recommendations for investors.
Here are five stocks most recommended for buying this Diwali:
1. ICICI Bank:
Target price: Rs 1,195
The second-largest private bank is one of the top picks this Diwali. Deposits are a key method of raising funds for a bank, and are cheaper than borrowing from the RBI. So a high ratio of current and savings account deposits to total deposits (CASA ratio) means the bank is attracting money at very low cost. This increases its profitability. ICICI Bank has the highest ratio among private sector banks. Its overall balance sheet also improved in the July-September quarter despite a slowdown in the economy.
2. Axis Bank:
Target Price: Rs 1,430
The bank has been increasing its presence in the retail banking segment by attracting more consumers to open current and savings accounts. It has also been consistently delivering better-than-industry growth due to this, according to Religare, a brokerage firm. Also, its asset quality has not worsened significantly in the first half of this fiscal. It has also turned cautious in offering loans on account of uncertain macro-economic conditions.
“Notwithstanding moderate concerns on its corporate book asset quality, we expect the retail business to drive earnings,” Angel Broking said in a report.
3. Tech Mahindra:
Target Price: Rs 1,830
India is seeing a pickup in exports. IT services exports account for a significant chunk of total exports. With the rupee hovering at 60/$-levels, the IT sector has the most to gain as it earns in dollars and other foreign currencies. Tech Mahindra, the first largest IT company in India post its merger with Satyam, has aggressively acquired deals. This is expected to help post a strong revenue growth. Also, the stock price is currently at attractive levels. “Its growth momentum likely to continue due to the pick-up in discretionary spending and strong deal momentum in the US and some parts of Europe,” Religare said in a report.
Other favourites in the IT space are Wipro and Infosys.
4. Colgate
Target Price: Rs 1,450
Oral care company Colgate has consistently reported strong volume growth by maintaining an aggressive strategy to reduce competition. This is expected to drive future growth too. Also, changing trends in consumption of tooth paste in rural areas and the power to increase prices without affecting demand are other positive factors for the consumer goods company. “We prefer Colgate India in the fast moving consumer goods (FMCG) space due to a better growth outlook and a better performance on the volume growth, which remains at 9-10% despite intense competition,” Sharekhan said.
Cigarette-maker ITC and Godrej Consumer Products Ltd are other favourites in the space.
5. L&T
Target Price: Rs 1,130
Despite a slowdown in the Indian economy, analysts are bullish about the infrastructure major L&T. It is expanding its presence outside India, which is now expected to contribute 30% of its total revenues. Even in the domestic front, it has posted a strong growth in terms of winning orders. This shows its ability to withstand a slowdown. “With a healthy order book, strong balance sheet, wide ranging capabilities and international presence, the company is optimistic about its growth,” Religare reported.
China reform checklist: How to tell that this time it's for real?
By Tomasz Janowski
TOKYO (Reuters) - The message from Beijing could not be clearer: China needs to shift to a more balanced economy that is socially and environmentally sustainable.
That was the conclusion of a key Communist Party meeting a decade ago, yet what followed was more of the same: rapid investment-led expansion, which turned China into the world's no.2 economy, but left it laden with debt, environmental damage and excess capacity.
Fast forward to 2013 and China's new leadership is again promising more harmonious development and the question is how to tell whether, this time, it is for real.
One encouraging sign suggesting that President Xi Jinping, Premier Li Keqiang and their team mean business is their greater tolerance for slower economic growth while they carry out reforms. After three decades of double-digit rises in GDP each year, the leaders have pencilled in 7.5 percent for 2013 - the weakest pace since the late 1990s.
"Since the reforms of the late 1970s, leaders have always without exception said that the growth rate is the first priority," said Zhao Xijun, deputy head of the Finance and Securities Institute at Renmin University in Beijing.
"The new leaders don't say they don't pay attention to growth, but the new priority is the stability of growth rather than a high growth rate."
The new approach was evident earlier this year when investors fretted the economy may be slowing down too much. Rather than adopting the sort of massive economic stimulus of the past, Beijing announced small-scale and targeted measures to support economic activity.
Chinese leaders have repeatedly said China needs to wean itself off a reliance on investment and exports, which in parts of the country have led to industrial overcapacity and pollution, and rely more on services and consumption, more akin to the developed economies of the West.
To do that means encouraging tens of millions of Chinese to move to cities to live while creating a social safety net and laws, particularly on land ownership, that will give them the confidence to do so.
The ultimate test of the new team's appetite for reform will be its actions, but the four-day third plenary session of the Communist Party's leadership starting on Saturday will offer some early clues.
Such meetings have served in the past as launch pads for major economic reforms like those unveiled in 1994 that paved the way for China's World Trade Organization membership, though some, such as the one a decade ago, failed to deliver.
By nature, the pronouncements are broad and often deliberately cryptic, but China watchers believe the tone and level of detail can reveal where the policy focus will be.
"For example, the state owned enterprises' reform will be touched on, but it will probably be in very general language and similar to one used before," said Haibin Zhu, chief China economist with JPMorgan in Hong Kong.
"But in some key areas, like fiscal or land reform they will be using more detailed language."
In the end, what will matter more is what the authorities do in the next six to 12 months. General expectations are that the follow-up will not be as dramatic as in 1994, but also that it will not be a non-event like a decade ago.
The consensus view in Beijing is that the authorities are not ready to take on state-owned giants that dominate sectors such as finance or energy or to let the struggling ones fail.
The focus therefore will be on the rest of the agenda: financial, fiscal, land and government administration reforms, pricing of resources, changes to social security and opening protected sectors to private and foreign competition.
All are seen contributing in one form or another to China's push towards more private investment, consumption, services and high-value manufacturing, so any progress there would be welcome by investors and economists.
"Many of these things hang together and you can't really go the full length on one without another, so any significant step on any of these will be welcome," Markus Rodlauer, deputy head of the International Monetary Fund's Asia Pacific Division in Washington, told Reuters.
What few seem to be advocating is for Beijing to break with its gradual, cautious approach.
"In a way, a gradual move on all of those (reforms) is what will in the end deliver," Rodlauer, who heads the Fund's China mission, said. "China has been well served by its strategy of gradual, careful reforms and does not need nor should it venture suddenly to implement Big Bang reforms."
Of all reforms, a financial overhaul is considered low hanging fruit. Markets and the currency are closely controlled and capital movements in and out of the country are restricted.
Driven by the central bank's governor, Zhou Xiaochuan, the gradual move towards market-driven interest and exchange rates and capital flows liberalisation is already under way and there is a clear roadmap.
In the least, investors expect to see a further broadening of the yuan's trading band next year and the establishment of a deposit insurance scheme - a prelude to a gradual freeing up of deposit rates and full liberalisation of interest rates.
"If we don't see anything on financial reform in 2014, that will be a very big disappointment," said JPMorgan's Zhu.
On the fiscal front, economists and investors will look for steps to share more evenly revenues and expenditure between central and local governments and the expansion of the use of value added tax in the services sector. Local governments now get about half of tax and other revenues, but are responsible for more than 80 percent of public spending.
Economists and observers will also look for progress towards a bilateral investment treaty with Washington and a similar pact with the European Union as proof of Beijing's intention to further open up its economy.
Some also expect to see land and residence registration reforms tested in some areas, translated into a nationwide policy that would support China's stated goal to boost its urban population.
By contrast, a proliferation of pilot schemes, such as the Shanghai Free Trade Zone trumpeted as a laboratory for sweeping financial market reforms, could signal a lack of political consensus to roll out the changes on a national scale.
Economists say some caution is understandable given many of the reforms mean handing over controls to market forces and coming months will show how quickly the authorities want to go.
But given no one knows how much time China has before its debt pile up, industrial overcapacity, environmental degradation and social tensions prove hard to control, erring too much on the safe side may be risky too.
"We don't know how much time Beijing has and we don't know whether the incremental approach they've used in the past is still possible," says Gudrun Wacker, a China policy specialist at German Institute for International and Security Affairs, a Berlin-based think tank.
"I believe they will spend the next five years trying to manage the problems and not do anything drastic, but it's like reading from tea leaves." (Tomasz Janowski, Asia Economics Correspondent; Additional reporting by Kevin Yao in Beijing; Editing by Neil Fullick)
Markets closed on Monday for public holiday
MUMBAI (Reuters) - Indian stock, debt and currency markets are closed on Monday for a public holiday. Trading will resume on Tuesday.
The BSE Sensex rose 0.2 percent on Friday, after earlier hitting a record high of 21,293.88 points, which surpassed the previous record set on January 10, 2008. The broader Nifty rose 0.1 percent.
The benchmark 10-year bond yield closed 8 basis points higher at 8.70 percent, while the partially convertible rupee closed at 61.74/75 per dollar compared with 61.50/51 on Thursday.
(Reporting by Mumbai markets team)
Banks hope futuristic flagships can tempt new customers
By Lionel Laurent
VELIZY, France (Reuters) - Installation art, interactive walls and a robot doorman; the flagship branches of the world's top banks have come a long way from the iron grilles and potted plants of old.
To compete against online-only rivals and to attract a new generation of customers to branches, banks are installing sleek interiors and hi-tech gadgetry.
ATMs that read fingerprints, touch-screen desks to flick through your finances and videoconference units for expert advice are all on display at payments-technology firm Wincor Nixdorf's showroom in the Paris suburb of Velizy.
"Banks are investing a lot in their retail branches," said Steve Bousabata, head of Wincor's French banking services arm. "They want customers to come back."
The reason is clear: after years of relying on branches to drive retail revenue, European banks expect such networks to supply only 62 percent of sales by 2020 from today's average of 81 percent, according to Equinox Consulting.
Banks, especially those still nursing losses from the financial crisis, are under pressure to cut costs and are balancing the need to pare back branch networks by sprucing up select outlets.
But branches are still the first point of contact for many customers and are still the primary location for product sales like mortgages, new accounts and insurance, underlining the importance of upgrading them for a more tech-savvy generation.
The difficulty is knowing exactly what belongs in the branch of the future and what is better left behind.
"Are all the things we see in branches today going to be seen in branches tomorrow? I very much doubt that," said Mike Baxter, head of management consultancy Bain's Americas Financial Services practice.
"There's an awful lot of experimentation of stuff that turns out to be unsuccessful and uneconomic."
Flashy "bank of the future" branches mixing gadgetry with design similar to Apple's
They include lounge areas, giant interactive screens and other trimmings such as handbags for sale and pieces of art.
Gauging their success is tricky. BNP was willing to give data on its refurbished flagship branch near the Paris Opera - which three years ago was fitted with a wall covered in plants, iPads for customer use and a touch-screen desk - saying that footfall was up 40 percent and new clients up 25 percent.
Italy's Unicredit also said that footfall and new business were up at its newly revamped flagship branch in the Bulgarian capital of Sofia, which offers "welcoming scents" and a touch-screen wall. Visits are up by an average of 60 percent while loans and deposits have doubled, a spokeswoman said.
On the other hand, BNP has done away with some ideas that failed to click with consumers: it has scrapped the iPads and touch-screen desk in favour of an interactive wall.
Deutsche Bank and Barclays declined to give data on single branches.
More broadly, some 88 percent of bank executives view their flagship branches in main street areas as being "successful" in promoting brand awareness, according to a survey by Equinox.
ROBOT BANKERS
Beyond Europe, the experiments are even bolder.
In South Korea, where mobile banking has flourished faster than in the West, Hana Bank allows mobile users to transfer money to one another by physically "bumping" smartphones. Shinhan Bank has also introduced unmanned "smart" branch kiosks that communicate with handsets.
Commonwealth Bank of Australia is using a mobile app to drive mortgage sales by offering clients data on houses for sale, while BBVA's
Customers of the Washington D.C. branch of Carolina Premier Bank
Although some of these advances may prove too gimmicky or not functional enough to catch on, long-distance banking via videoconference is seen as a way to reduce branch staffing without hurting service, though customers still prefer a physical point of contact somewhere along the line.
"Mortgage specialists sitting at headquarters, connecting via videoconference to the relationship manager; that works," said Bain's head of global retail banking, Dirk Vater.
"But bank-to-consumer, with people sitting on the sofa using Skype and Facetime, has not been adopted yet. It will eventually ... But not yet."
Increased ATM functionality as used by Citibank Asia and more secure biometric readers are also promising, he added.
The ultimate question of whether to scrap the branch entirely is one that is not being considered, consultants said.
The preference is for a "hub-and-spoke" model that pools resources in urban areas and reduces smaller, rural branches.
While this may lead to more ambitious flagship outlets, it can create gaps for new competitors to fill: France's Nickel, which offers a low-cost current account, is creating a branch network with the country's 27,000 tobacconists.
"Even in developed markets, the death of branches is somewhat exaggerated," Ernst & Young wrote in a 2012 report.
"We will see further evolution of the branch experience from something that looks like a local government office ...(to) a hybrid between coffee shop and technology store." (Additional reporting by Steve Slater in London, Tsvetelia Tsolova in Sofia, Jackie Range in Sydney and Douwe Miedema in Washington; Editing by Carmel Crimmins and Giles Elgood)
Investors pour $54.2 billion into equity mutual funds - TrimTabs
REUTERS - Investors poured some $54.2 billion into all equity mutual funds and exchange-traded funds in October, the third-largest inflow on record, data from TrimTabs Investment Research showed on Sunday.
All three of the largest monthly inflows into all equity funds have occurred this year, and this year's inflow of $286 billion into all equity funds is the biggest since 2000, TrimTabs added.
"When fund investors are as upbeat as they are now, a short-term pullback would not be a surprise," said David Santschi, chief executive officer at TrimTabs Investment Research.
Fund Investors keep dumping bonds, however. Bond funds posted five consecutive monthly outflows for the first time since late 2003.
Outflows have picked up even though the average fund was up 1.3 percent in September and 0.9 percent in October, TrimTabs said. Bond mutual funds and ETFs redeemed $13.5 billion in October, almost triple the outflow of $4.9 billion in September, the firm noted.
"We cannot emphasize enough how much recent outflows mark a dramatic shift for the fixed-income world," Santschi said. Bond funds have not posted five consecutive monthly outflows since August 2003 to December 2003, TrimTabs said.
New offerings surged to $23.6 billion in past two weeks, and Dealogic reports $4.3 billion already scheduled for this week, according to the research.
The U.S. economy slowed in October, while real wages and salaries climbed a scant 0.5 percent year over year, the researched showed.
TrimTabs said its demand indicators suggest the U.S. stock market may struggle to move much higher over the short-term but that the longer-term uptrend is secure.
While the S&P 500 is up 23.5 percent year-to-date, TrimTabs said its indicators do not point to a major sell-off anytime soon.
TrimTabs said its Demand Index stood at 77.9 on October 30, up a bit from 73.6 a week earlier (readings above 50 are bullish).
Although the index did not rise much, TrimTabs said it managed to clear the 75 threshold.
The short-term outlook is a lot less favorable, TrimTabs said, noting exchange-traded funds flows suggest stocks will have a tough time moving much higher.
Inflows into leveraged short exchange-traded funds stopped in the past week, which is a cautionary sign from a contrarian perspective, TrimTabs said. (Reporting by Scott DiSavino and Jennifer Ablan; Editing by Maureen Bavdek)
Sensex jumps 69 points on special Diwali trading
Mumbai, Nov 3 (IANS) A benchmark index of the Indian equities markets rose 69 points in the special Diwali trading Sunday, led by good buying support in auto, FMCG and oil and gas stocks.
The 30 scrip sensitive index S&P Sensex of the Bombay Stock Exchange opened the special session at 21,278.08 points and was ruling at 21,265.84 points, at around 6.30 p.m., up 0.33 percent or 69.03 points from its previous close of 21,196.81 points.
The special session called Mahurat trading was organised to mark the beginning of Samvat year 2070, a new year according to the Hindu calendar.
Nifty of the National Stock Exchange was up 19.25 points higher at 6,326.60 points.
Onion prices to come down after Diwali: Dikshit
New Delhi, Nov 2 (IANS) Delhi Chief Minister Shiela Dikshit Saturday said the onion prices in the national capital would come down after Diwali as new stocks were all set to arrive by next week.
Dikshit, who had come to power defeating the then Bharatiya Janata Party government in 1998 riding on high onion prices, said her government has spoken to the onion suppliers from various states in the country and managed to get stock of onions to tackle the crisis.
"The wholesale price of onion will be Rs.10 whereas retail price will be around Rs.45-46," she added.
Dikshit also released a three-minute short film, sung by pop singer-turned-politician Daler Mehendi, showing developments of the Congress government during her tenure of 15 years.
She said the film would be shown in every theatre of the capital and in the Congress vans that visit constituencies.
Saturday, 2 November 2013
Rupee weakens tracking broad dollar rally; share gains limit fall
By Swati Bhat
MUMBAI (Reuters) - The rupee dropped to a three-week low on Friday while also posting its biggest weekly fall in two months as a sharp sell-off in the euro and broad rally in the greenback hurt amid the absence of any fresh domestic triggers.
The euro fell to a two-week low against the dollar on Friday, extending losses into a fifth straight session as slowing euro zone inflation bolstered expectations of looser monetary policy from the European Central Bank.
The rupee which has been relatively stable over the last couple of months after having seen as much as 20 percent fall to a record low in late August has been boosted mainly by robust foreign fund inflows into the stock market. Foreign funds have bought $16.5 billion worth of shares so far this year.
The BSE Sensex surged to a record high as blue chips rallied on the back of strong foreign buying.
"The huge fall in the euro and a rally in the dollar index have pushed the rupee down today, but 62 is a psychological level which will be a key," said Paresh Nayar, head of foreign exchange and debt trading at First Bank Bank.
"The 61.20 support should hold for next week as well, but the overall range could be wider," he added.
The partially convertible rupee closed at 61.74/75 per dollar compared with 61.50/51 on Thursday. Financial markets will remain closed on Monday for a local holiday.
On the week, the rupee fell 0.5 percent, its biggest weekly fall since the last week of August.
The index of the dollar against six major currencies was up 0.4 percent.
Traders will monitor developments on the global front for near-term cues as there is no data or event due on the domestic front.
In the offshore non-deliverable forwards, the one-month contract was at 61.36, while the three-month was at 63.38.
(Editing by Anand Basu)
Nissan posts weaker than expected profits in Q3
Tokyo, Nov. 02 (ANI): Japan's second-biggest automaker Nissan has reported weaker than expected profits for Q3 and reshuffled its management to cope with quality issues and tough market conditions.
The company posted a 107.8 billion yen net profit for the third quarter, with a meager 2 percent increase from 105.7 billion yen last year, the Japan Times reports.
Meanwhile, the company's quarterly sales rose 16 percent to 2.5 trillion yen.
Nissan President and Chief Executive Carlos Ghosn said the main reason was their weakness in many emerging markets and painfully expensive recalls.
The company's Chief Operating Officer (COO), Toshiyuki Shiga, has been made the vice chairman and three other executives were appointed as COOs. (ANI)
Gold hits 2-week low on strong dollar, down for week
By Clara Denina
LONDON (Reuters) - Gold fell to a two-week low on Friday and headed for a weekly drop as upbeat U.S. economic data lifted the dollar, raising anxiety over the Federal Reserve's future course.
The metal was headed for a 2.8 percent weekly drop, after climbing for two consecutive weeks, as expectations the U.S. Federal Reserve will maintain its economic stimulus seemed to have been factored in.
Spot gold was down 0.7 percent to $1,313.96 an ounce by 1244 GMT, extending Thursday's 1.4 percent slide. It earlier fell to the lowest level since October 22 at $1,311.50.
Comex gold futures for December fell $10.30 to $1,313.20 an ounce.
The euro plunged against the dollar after a sharp slowing in euro zone inflation left markets suddenly considering the outside chance of a cut in interest rates soon by the European Central Bank.
The dollar rose to two-week highs against a basket of currencies, in part due to a statement by the Federal Open Market Committee that was not as dovish on the timing of curbing stimulus as investors had expected
"The weakness we have been seeing in gold in the past two days is due to the after-effects of the FOMC statement and also the extremely low inflation rate in the euro zone," Commerzbank analyst Daniel Briesemann said.
"These factors are very supportive of the dollar, which in turn weighed on precious metals prices."
The dollar also got a boost from U.S. data showing the pace of business activity in the Midwest region had risen more than expected in October and weekly jobless claims declined, soothing some worries about sluggish fourth-quarter growth.
A stronger U.S. currency makes dollar-denominated assets such as gold more expensive for foreign investors.
FED FOCUS
Market focus remains heavily on U.S. monetary policy and how soon the Fed will begin tapering its $85 billion a month support programme.
Later on Friday, investors will closely monitor the U.S. ISM survey of manufacturing for October.
Prices had gained 8 percent, since hitting a three-month low in mid-October, after soft U.S. data last month and Washington's budget gridlock led investors to bet the Fed would postpone the tapering of its bullion-friendly stimulus measures.
As a gauge of investor sentiment, New York's SPDR Gold Trust, the biggest gold-backed ETF, reported an outflow of 34 tonnes in October, its biggest monthly drop since July. That brings its outflows for the year to 479 tonnes, or more than $20 billion this year. Holdings of the fund are near four-year lows of 872 tonnes.
Spot silver was unchanged at $21.85 an ounce after falling to its lowest since October 17 at $21.66 earlier in the day. It had fallen 3.5 percent on Thursday, its biggest one-day loss in a month.
The biggest silver ETF, the iShares Silver Trust, also recorded a monthly outflow of 127.4 tonnes in October, its first since June.
Spot platinum was up 0.2 percent at $1,451.74 an ounce, gaining modest support from news that 7,000 members of South Africa's National Union of Mineworkers will down tools at Northam Platinum on Sunday night in a strike over wages.
Spot palladium fell 0.4 percent at $732.00 an ounce.
(Additional reporting by A. Ananthalakshmi in Singapore; editing by James Jukwey and Jane Baird)
Sensex closes at record high; bank stocks gain
Mumbai, Nov 1 (IANS) A benchmark index of Indian stock markets ended Samvat 2069 Friday hitting its third straight record closing high at 21,196.81 points. The market barometer also crossed its highest level so far intra-day.
The 30-scrip S&P Sensex of the Bombay Stock Exchange (BSE) closed 32.29 points or 0.15 percent higher at 21,196.81 points, from the previous day's close at 21,164.52 points. This is the highest closing level of the benchmark index so far.
The Sensex surpassed its highest so far level of 21,206.77 points on Jan 10, 2008 in the intra-day trade when it touched 21,293.88 points.
The wider 50-scrip Nifty of the National Stock Exchange (NSE) also made gains. It ended at 6,307.20 points, up 8.05 points or 0.13 percent.
Healthy buying was observed in bank, automobile and metal sectors. However, fast moving consumer goods (FMCG), consumer durables and oil and gas stocks.
The S&P BSE Bank index was up 189.23 points, followed by automobile index which was higher by 155.63 points and metal index, which gained 129.48 points.
However, FMCG index was 62.49 points down, consumer durables index was down 45.77 points and oil and gas sector was down 45.49 points.
Prominent Sensex gainers were: State Bank of India (SBI), up 4.67 percent at Rs.1,879.40; Mahindra and Mahindra (M&M), up 4.12 percent at Rs.924.95; Jindal Steel, 3.46 percent at Rs.248.35; Seas Sterlite, up 2.30 percent at Rs.206.55; and BHEL, up 1.77 percent at Rs.143.45.
Only ten of the 30 Sensex scrips closed in the red. ONGC, down 1.88 percent at Rs.287.70; NTPC, down 1.71 percent at Rs.146.15; ITC, down 1.66 percent at Rs.328.70; Infosys, down 0.90 percent at Rs.3,278.75; and Gail India, down 0.71 percent at Rs.350.35 were among the major Sensex losers.
The New Samvat year (New Year according to Hindu calendar) begins this weekend
Among the Asian markets, Japan's Nikkei closed 0.88 percent down, Hong Kong's Hang Seng was higher by 0.19 percent, and China's Shanghai Composite Index gained 0.37 percent.
In Europe, London's FTSE 100 was trading 0.08 percent higher, and Germany's DAX Index was down 0.19 percent. The French CAC 40 Index closed the day's trade 0.28 percent down.
Latest Nasdaq options glitch highlights ongoing market problems
By John McCrank
NEW YORK (Reuters) - Nasdaq OMX Group Inc closed its second-largest options market for much of Friday after a spike in volume hampered the exchange's ability to accept orders and distribute quotes, the latest glitch to hit U.S. market operators.
The Nasdaq Options Market (NOM), which accounted for about 8 percent of U.S. options volume last month, was halted at 10:36:57 a.m. EDT (1436 GMT) and remained shut through the rest of Friday, Nasdaq said.
In a statement, Nasdaq said it determined that it was "in the best interest of market participants and investors to cancel all open orders...and to continue to market halt through the close." A Nasdaq spokesman declined comment beyond that statement.
While the halt had minimal effect on the markets, it was the latest in a raft of other industry glitches and issues in recent months and years that have raised concerns about the soundness of market infrastructure.
The problems have prompted a flurry of testing by exchanges, including NYSE Euronext's first-ever IPO simulation ahead of Twitter's highly anticipated IPO in an effort to avoid the costly problems that hit Nasdaq following Facebook's market debut.
Last week, Nasdaq had to contend with a 45-minute halt in options trading on some Nasdaq stock indexes and in August, a three-hour shutdown in all Nasdaq-listed shares.
Friday's incident came on a day with overall below-average volume in the options market. After the halt, most people were able to route option orders away to other market centers rather quickly, said J.J. Kinahan, chief strategist at TD Ameritrade.
Equity options trading continued to take place on 11 other venues, including Nasdaq's PHLX and BX Options exchanges. Equities trading was not affected. Nasdaq said it would cancel all open orders on the all-electronic NOM book.
While exchange-listed options trading volume in October was up 24 percent from a year earlier, according to clearing organization OCC, Friday was not an especially busy day. About 15.1 million contracts changed hands, falling short of the average daily trading volume of 17.1 million contracts for the last 22 trading days, according to Trade Alert.
GLITCHES GALORE
"Some of these things have happened because of the interconnectedness and the complexity of the U.S. equity markets," said Bill Brodsky, chairman of options exchange CBOE Holdings Inc , on the sidelines of the World Federation of Exchanges annual meeting in Mexico City on Wednesday.
"Automation has occurred at such a rapid pace, and yet the basic structure of the markets was designed before people were measuring things in milliseconds and recognizing that the markets would become virtually totally automatic."
Human error was blamed for the 45 minute trading halt in options trading on some Nasdaq stock indexes last week. On August 22, all Nasdaq stocks, including Apple Inc
Following that problem, the U.S. Securities and Exchange Commission called the heads of all of the exchanges to Washington on September 12 to discuss ways to strengthen critical market infrastructure and improve its resilience when technology fails.
The exchanges have to report back to SEC Chair Mary Jo White by November 12. Last week, SEC member Luis Aguilar called for stricter penalties against exchanges for market disruptions.
TESTING ON THE RISE
"I think we'll all be better off as a result of the meeting and the work that comes out of it," said Brodsky.
CBOE experienced a glitch in April that shut down the Chicago Board Options Exchange, the No. 1 U.S. stock-options market, for half a day, preventing trading in options on two of the U.S. market's most closely watched indexes.
Part of CBOE's focus since has been to make sure it can cut over to its backup systems more quickly, said Brodsky.
At NYSE, where a bug in new software being rolled out in September briefly led to a trading halt across U.S. options markets, more testing is going on as well.
The New York Stock Exchange held its first-ever simulated IPO last Saturday in anticipation of high volume for Twitter's forthcoming market debut.
Those tests were done in an attempt to avoid the types of problems that Nasdaq experienced during Facebook's 2012 IPO, when a tremendous volume of orders on the first day of trading exposed a glitch in Nasdaq's system. That ultimately prevented timely order confirmations for many traders, leaving them unsure about their exposure for hours, and in some cases for days afterwards.
Major market makers estimated they lost collectively up to $500 million in the IPO. Last week, Nasdaq said it would voluntarily pay out a maximum of $41.6 million to market makers, though some are still seeking more restitution via arbitration.
(Reporting by John McCrank; Editing by Gerald E. McCormick, Nick Zieminski and Ken Wills)
JPMorgan discloses wider probes of hiring, currency trading
REUTERS - JPMorgan Chase & Co , the biggest U.S. bank by assets, disclosed on Friday that the U.S. Department of Justice and agencies from other jurisdictions are investigating hiring practices in Hong Kong that were already being probed by the U.S. Securities and Exchange Commission.
The company also said that it is being questioned about its currency trading by various authorities, which are in the early stages of their investigations.
Other big banks have made similar disclosures recently about probes of possible manipulation of foreign exchange rates.
JPMorgan also gave more details about U.S. government investigations into the bank's relationship with convicted Ponzi schemer Bernie Madoff. Two government offices, the U.S. Attorney's Office for the Southern District of New York and the Office of the Comptroller of the Currency, are currently looking into the ties between Madoff and the bank.
The U.S. Attorney's Office for the Southern District of New York is also investigating the bank's activities in the California and Midwest power markets that were the subject of a $410 million settlement between JPMorgan and the Federal Energy Regulatory Commission.
Additionally, the bank offered more specifics on the amount of claims that investors and bond insurers had over mortgage-backed securities. Total claims added up to approximately $117 billion, $88 billion of which involves Bear Stearns, Washington Mutual, JPMorgan or its affiliates as an issuer and $29 billion of which involves the entities solely as underwriters.
The company made the statements in a quarterly filing with the U.S. Securities and Exchange Commission.
(Reporting by David Henry and Peter Rudegeair in New York; Editing by Phil Berlowitz)
Vodafone rises on report of AT&T takeover interest
LONDON (Reuters) - Shares in Vodafone Group rose on Friday after a media report that U.S. mobile operator AT&T was exploring strategies for a potential takeover of the British telecoms firm.
AT&T Chief Executive Randall Stephenson has said there is a "huge opportunity" to invest in mobile broadband in Europe and he would buy wireless assets if they were available at the right price.
AT&T is the second-largest mobile provider in the United States after Verizon Wireless. But it is not adding new customers in its home market as fast as Verizon, and it is also ceding market share to much smaller rival T-Mobile US .
Vodafone sold its stake in Verizon Wireless to its joint venture partner Verizon Communications Inc for $130 billion in September, leaving it with a pan-European business spanning Britain to Romania and operations in the Middle East and Africa.
AT&T has been eyeing Europe since the beginning of the year and has considered options including Vodafone and Britain's largest mobile carrier EE, a joint venture of Orange and Deutsche Telekom , sector bankers have previously told Reuters.
A Bloomberg report on Thursday, citing people familiar with the situation, said AT&T was examining how it could divide Vodafone up after a deal, keeping some assets and disposing of others. The companies have not entered formal negotiations, the report said.
Shares in Vodafone were up 2.9 percent to 231 pence at 1104 GMT, the biggest gainers on the FTSE 100 <.ftse> index of blue-chip stocks.
Espirito Santo analyst Robert Grindle said it was logical for AT&T to consider its options regarding Vodafone, following its U.S. exit.
"What we don't have full clarity on is how ambitious AT&T is," he said. "(The report) is short on substance but long on plausibility."
Vodafone and AT&T declined to comment.
(Reporting by Paul Sandle and Sarah Young; Editing by Erica Billingham)
China jails former top provincial official for life over bribes
BEIJING (Reuters) - China on Friday jailed for life a former vice governor of the northeastern province of Jilin and former banker for taking more than $3 million in bribes, in the government's latest move to crack down on deep-rooted corruption.
Tian Xueren was expelled from the ruling Communist Party in July of last year and went on trial last month in Beijing, accused of receiving more than 19 million yuan in bribes, state media have said.
"As an official of the state, Tian Xueren used his position to seek gains for others, and used the power of his position ... to illegally collect money and gifts from others," the First Intermediate Court of Beijing said on its microblog.
"This behaviour constitutes the crime of taking bribes."
Between 1995 and 2001, Tian helped companies and officials to get contracts, loans and promotions, while also serving as chairman of the state-run Bank of Jilin, the court added.
Tian cooperated in the investigation, providing information about bribes authorities had not been aware of, and had a "good attitude" towards admitting his guilt, the court said.
President Xi Jinping, who took office in March, has called corruption a threat to the ruling Communist Party's survival and vowed to go after powerful "tigers" as well as lowly "flies".
But his crackdown has only netted a handful of senior officials, among them former executives of oil giant PetroChina.
The most high-profile recent case was the conviction of Bo Xilai, once a rising star in China's leadership, who was jailed for life in September after a murder scandal involving his wife, Gu Kailai, that shook the party.
But the government has shown no sign of considering reforms such as setting up an anti-graft body independent of the party that could more effectively tackle the problem.
(Reporting by Ben Blanchard; Editing by Clarence Fernandez)
Wall St Week Ahead - Twitter's IPO to provide week's excitement
By Angela Moon
NEW YORK (Reuters) - Twitter will be the talk of Wall Street next week when the social media company goes public in the stock market's most anticipated initial public offering since 2012's Facebook .
Twitter is expected to price its IPO on the evening of November 6 and begin trading November 7 on the New York Stock Exchange under the symbol .
"It's not just about the stock. Twitter's IPO will be a measure of how much liquidity is out there," said John Rutledge, chief investment strategist at SAFANAD, a private investment firm in New Canaan, Connecticut.
Twitter has said it will sell 70 million shares at a price between $17 and $20, valuing the online messaging company as much as $11 billion, below the $15 billion that some analysts had been expecting.
FACEBOOK'S IPO FATE
The market will be on alert to see if Twitter follows the fate of last year's botched Facebook Inc IPO: the social networking company's stock hit the market in May 2012 and was plagued by allocation problems, trading glitches and a selloff. The shares did not recover the IPO price until a year later.
Views have been mixed on what investing strategy to take for Twitter's IPO. According to a Reuters survey of 29 broker-dealers and independent advisers, 23 said they are not recommending Twitter shares. Only one said he would recommend it - and only to certain clients. Five others said they would wait to snap up the stock if it plunges after it begins to trade.
But while retail interest might be low, tech industry analysts say there is expected to be a good appetite for Twitter's stock from institutional investors at the current valuation.
On Friday, Morningstar joined three other brokerages in setting price targets for Twitter Inc well above its IPO price range, suggesting the stock has room to rise at least 30 percent.
The Wall Street brokerages set a price target of $26 a share. Last month, Pivotal Research had set its price target at $29 a share, SunTrust at $50 and Topeka Capital at $54.
GOV'T SHUTDOWN IMPACT
Another event that will grab investors' attention will be the Labor Department's release of non-farm payroll figures for October on November 8. The announcement was delayed by the 16-day partial U.S. government shutdown in early October. Some market participants warn that the data could be skewed due to the shutdown.
"It's hard to have a takeaway for the markets because we're at a point in time where we have to take all the data with a bit of a grain of salt. Some of it is old, some may not be affected by the shutdown yet," said Art Hogan, managing director at Lazard Capital Markets in New York.
On Friday, the Institute for Supply Management's index of national factory activity was not affected by the government shutdown, showing the best reading since April 2011.
"This was supposed to be a government shutdown-affected number, and it certainly didn't show that," Hogan said.
For the week, the Dow rose 0.3 percent and the S&P 500 gained 0.1 percent, while the Nasdaq slipped 0.5 percent.
But beyond the factory data, the government shutdown did appear to dampen consumers' appetite for new cars last month. Seven of the top eight automakers reporting monthly sales on Friday missed analysts' expectations.
Next week's economic indicators also include factory orders on Monday, followed by the ISM services index on Tuesday. On Thursday, third-quarter gross domestic product and weekly jobless claims will be released. In addition to the unemployment numbers, U.S. personal income and outlays and the Thomson Reuters/University of Michigan consumer sentiment index are due on Friday.
EARNINGS SEASON CONTINUES
Earnings will also be in focus. So far, out of the 74 percent of S&P 500 companies which have reported, 68.5 percent have topped Wall Street's expectations, above the long-term average of 63 percent. But just 53.3 percent have topped revenue forecasts, below the 61 percent average since 2002, Thomson Reuters data showed.
After the Nasdaq OMX Group Inc closed its second largest options market for much of Friday due to a technical glitch, many investors will be watching whether the operations will fully resume on Monday.
The Nasdaq Options Market, which accounted for around 8 percent of U.S. options volume last month, was halted at 10:36:57 a.m. EDT (1436 GMT) and remained shut through the rest of Friday. While the halt had a minimal effect on the options markets, it was the latest in a series of industry mishaps have raised concerns about infrastructure.
(Additional reporting by Rodrigo Campos; Editing by Kenneth Barry)
Global Markets - Euro on the ropes after dive in inflation
By Marc Jones
LONDON (Reuters) - The euro tumbled to a two-week low on Friday after a plunge in euro zone inflation left markets suddenly eyeing the possibility of an interest rate cut by the European Central Bank next week.
European shares saw a subdued end to what looked to be a fourth week of gains, but the combination of Thursday's surprise dive in inflation to just 0.7 percent and a revitalised dollar kept the main focus on the fragile euro.
After its biggest fall in six months in the previous session, the shared currency shed a further 0.6 percent to $1.3513, leaving it flirting with its biggest weekly drop since July last year.
"It is clear that there has been a major sentiment change on the euro," said John Hardy, head of FX strategy at Saxo bank in Copenhagen.
"The ECB's single mandate has always been on inflation so this gives Draghi and co further reason to do something at next week's meeting. We see considerable further downside, the likes of euro/dollar back into the old range, down towards $1.30."
A handful of big banks including UBS, RBS and Bank of America/Merrill Lynch revised their calls saying they now expect a rate cut next week and the pressure on the euro increased after banks made their biggest repayment of ECB crisis loans since April.
The move was also amplified as the dollar continued to kick away from a recent nine-month low, boosted by upbeat U.S. data overnight that added to the debate on future Fed stimulus.
U.S. S&P E-mini futures edged up about 0.2 percent, pointing to a slightly higher start on Wall Street, after the S&P 500 Index closed down about 0.4 percent on Thursday but still gained 4.5 percent for the month.
Stock markets across Europe were between flat and down 0.5 percent ahead of the U.S. restart, pegged back by signs of third-quarter weakness at some major European firms.
At the same time, the return of bets on an ECB rate cut saw euro zone government bonds extend this week's gains.
TAPER TALK
Markets' focus remains heavily on U.S. monetary policy and how soon the Federal Reserve will begin tapering back its $85 billion a month support programme, having delayed a move in September.
The ISM survey of manufacturing for October will give investors the latest temperature reading on the state of the U.S. economy after some upbeat PMI data on Thursday.
"If the ISM report is better than expected, it could add to revived tapering expectations, and U.S. yields and the dollar could go up and stocks could go down," said Masashi Murata, senior currency strategist at Brown Brothers Harriman in Tokyo.
Not all players are convinced that this week's U.S. newsflow heralds a shift in monetary policy expectations, given the disruption caused by last month's Federal shutdown.
"The existence of noise in the October data will likely make it difficult for the Fed to gather enough evidence to start tapering in December," strategists at Barclays said in a note.
CHINA REASSURES
In Asian trading, reassuring signals on China's factory activity offered support to the region's markets, though Tokyo's Nikkei finished at a one-week low as the yen strengthened against the euro.
Among commodities, gold dropped to $1,313 an ounce leaving it at its lowest in nearly two weeks, hurt by sharp losses in the previous session from month-end profit-taking, the strong U.S. economic data and the higher dollar.
Copper got a lift from the China data, rising to $7,282 a tonne and back toward a one-week peak of $7,300 hit on Thursday. But it was not enough to help oil, with Brent falling back to $107.8 a barrel as U.S. crude slid to $95.72.
"There were reports that some of the ports in Libya were reopening and any signs that that oil is coming back online is going to hit the oil price," said Abhishek Deshpande, oil market analyst for Nataxis in London.
"There are also signs of generally lower season demand for oil at the moment as China's refineries go into maintenance."
(Additional reporting by Lisa Twaronite in Tokyo; Editing by Patrick Graham and Susan Fenton)
U.S. regulator considers end to sports broadcast blackout rule
By Alina Selyukh
WASHINGTON (Reuters) - The Federal Communications Commission is considering whether to eliminate a decades-old rule that prohibited broadcasting of some professional sporting events, often NFL football games, in their home markets.
The FCC said on Friday its members are reviewing a proposal to eliminate the nearly 40-year-old rule that was originally meant to ensure broadcasts of sports games did not hurt local ticket sales.
"Changes in the marketplace have raised questions about whether these rules are still in the public interest, particularly at a time when high ticket prices and the economy make it difficult for many sports fans to attend games," FCC acting Chairwoman Mignon Clyburn said in a statement.
The FCC will study whether the rules "remain justified" and could eventually take them off the books. The sports leagues, broadcasters and cable and satellite service providers could still privately negotiate blackout agreements.
It is often such private agreements, and not the commission's rules, that prompt home game blackouts, according to the FCC.
The rules also are unrelated to some high-profile longer-lasting blackouts that are prompted by disagreements over the fees that TV operators pay programmers to carry their channels, such as the one this summer between CBS and Time Warner Cable .
The sports blackout rules have faced mounting criticism in recent years for being outdated. A group called the Sports Fans Coalition, which received backing from Verizon and Time Warner Cable, petitioned the FCC in 2011 to end the rules and received support from several consumer interest groups.
However, broadcasters have been an influential opponent of elimination of the FCC rules, and criticized Friday's announcement.
They point out that the rule prevents cable and satellite providers from offering games that may be blacked out in local markets and that without such a rule, the games would be available only to cable and satellite TV customers and not those relying on free TV.
"Sports blackouts are exceedingly rare, and NAB dislikes these disruptions as much as our viewers," the National Association of Broadcasters spokesman Dennis Wharton said in a statement on Friday.
"However, we're concerned that today's proposal may hasten the migration of sports to pay-TV platforms, and will disadvantage the growing number of people who rely on free, over-the-air television," and could undermine the economic health of local broadcasters.
Clyburn said she circulated her proposal to the other FCC commissioners on Friday, her last day as acting chief of the agency. Tom Wheeler, a telecom industry veteran and former cable and wireless top lobbyist, is expected to take over the FCC on Monday after the Senate confirmed him this week. (Reporting by Alina Selyukh; Editing by Ros Krasny, Leslie Gevirtz and Ken Wills)
Euro falls on potential ECB rate cut, global stocks slip anew
By Herbert Lash
NEW YORK (Reuters) - Global equity markets slipped on Friday despite upbeat factory data worldwide, while the euro fell to a two-week low against the dollar on expectations that a rate cut by the European Central Bank is possible by the end of the year.
Stocks on Wall Street edged lower after data showing U.S. manufacturing expanded briskly in October raised some worries that the U.S. Federal Reserve may scale back its massive stimulus much sooner than expected.
U.S. equities have been pressured since a Fed statement on Wednesday raised concerns about when the central bank would begin to scale back its stimulus program, which has fueled the benchmark S&P 500 index's 23-percent rally this year.
The Institute for Supply Management (ISM) said its index of U.S. factory activity rose to 56.4 last month - its best showing since April 2011 - from 56.2 in September. Economists polled by Reuters had expected a reading of 55.
The S&P and Dow Jones industrial average have repeatedly hit record highs this year, including earlier in the week, but the strong gains have triggered some concerns about how much further the rally can continue, especially in light of tepid corporate revenue growth.
With almost three-fourths of S&P 500 companies reporting results so far, 68.5 percent have beaten profit expectations, above the long-term average of 63 percent, according to Thomson Reuters data. However, only 53.3 percent have topped revenue forecasts, below the 61 percent average since 2002.
"I'm not comfortable with the market at all-time highs, especially with earnings being mediocre," said Mark Grant, managing director at Southwest Securities in Fort Lauderdale, Florida.
"But the manufacturing report was better than expected, and where else can you go with the Fed putting so much liquidity into the system?" Grant said.
The Dow Jones industrial average was up 30.57 points, or 0.20 percent, at 15,576.32. The Standard & Poor's 500 Index was down 0.28 points, or 0.02 percent, at 1,756.26. The Nasdaq Composite Index was down 7.57 points, or 0.19 percent, at 3,912.13.
European stock markets eased off five-year highs amid signs of weakness in regional corporate earnings.
The pan-European FTSEurofirst 300 index of leading European companies fell 0.31 percent to close at 1,288.67.
U.S. Treasuries prices fell for a third consecutive session as the encouraging ISM report on manufacturing suggested the U.S. economy overcame a drag from the partial government shutdown in October.
The rosier data revived some worries among investors that the Fed might scale back its bond-buying earlier than expected - at its December meeting - rather than early in 2014.
"There is a feeling that they might taper in December. It has gained a little steam, but that's not the consensus," said Matt Duch, a portfolio manager at Calvert Investments in Bethesda, Maryland.
The benchmark 10-year U.S. Treasury note was down 19/32 in price to yield 2.6108 percent.
Euro zone bonds broadly edged higher, extending this week's rise, after data showed a surprisingly sharp inflation slowdown in the euro zone. Many in the market expect the ECB to signal a rate cut or new liquidity injections at its meeting next week.
German two-year yields, the most sensitive to shifts in monetary policy expectations, were 1 basis point lower at 0.11 percent,
Bund futures fell 15 ticks to settle at 141.85, having hit a two-month peak of 142.32 on Thursday.
Expectations of an ECB rate cut was seen eroding the euro's interest rate advantage over other major currencies. The single currency was poised to notch its worst weekly loss against the dollar since July 2012.
The euro fell 0.74 percent to $1.3482.
Renewed pressure on the euro saw the dollar index rise to a six-week high of 80.785, climbing further up from a nine-month trough of 78.998 plumbed a week earlier. It last traded at 80.777.
The dollar was up 0.43 percent against the yen at 98.77 yen, according to Reuters data.
Brent crude oil dropped by more than $2 to below $107 a barrel as a strong dollar outweighed previous concerns over a drop in Libyan crude exports.
Brent crude for December delivery was down by $2.14 at $106.70 after rising as high as $109.41 a barrel in early trading.
U.S. oil for December was down $1.37 at $95.01, putting it in line for a fourth straight week of declines, its longest losing streak since June 2012.
(Reporting by Herbert Lash; Editing by Bernadette Baum)
'Current Account Deficit will be contained at 60 billion dollars': Chidambaram
New Delhi, Nov.1 (ANI): Finance Minister P Chidambaram on Thursday said that the Current Account Deficit (CAD) is under control, and will be contained at 60 billion dollars.
"Current Account Deficit shall be contained at 60 billion dollars. It is well under control, and I am confident we will be able to adhere to red line for fiscal deficit. Earlier current account deficit target was 70 billion dollars," he told media here today.
"There has been a sharp pick up in exports in last three months. Trade balance will be well contained, and it will reflect on current account deficit," he added.
He further said that inflation and reviving investments are key challenges for the government.
"We are confident that the steps taken by the Reserve Bank of India (RBI) will bring moderation in inflation," he said.
"The rupee has by and large stabilised, though in my personal opinion it is still trading above its appropriate level. The stability in currency markets will give comfort to take more measures,' he added.
Chidambaram also cautioned the investors against exuberance over market rally.
"Investor confidence in India remains intact. I would caution investors against excessive exuberance over market rally," he said.
He also said that the Foreign Direct Investment (FDI) inflows have been encouraging.
"Looking forward to more FDI inflows in pharmaceutical sector, single brand retail, multi brand retail and telecom sectors," he added.
The BSE Sensex hit an all-time high today breaking its earlier record of 21,206, which was set in January 2008.
The Sensex set a new all-time high record of 21,293.88, up nearly 130 points. The Nifty gained 8 points to close at 6,307. (ANI)
Dhanteras traffic snarls choke parts of Delhi
New Delhi, Nov 1 (IANS) Parts of the city witnessed heavy traffic jams as revellers came out in droves to shop on the occasion of Dhanteras celebrated Friday while many others visited friends and family to exchange gifts ahead of Diwali on Sunday.
Traditionally, buying gold and other precious metals like silver and even steel utensils on Dhanteras is considered to be auspicious. Hence, the capital's popular markets saw the maximum rush.
Serpentine queues of vehicles could be seen in and around the Lajpat Nagar Central Market, South Extension, Greater Kailash, Khan Market, Chandi Chowk, Karol Bagh, Connaught Place, Rajouri Garden and Pitampura markets.
As a result, the traffic spilled on to major intersections, further adding to the stress and tensions of motorists. Places like Bhogal, Ashram, Tughlakabad, Okhla and parts of the Ring Road near the All India Institute of Medical Sciences were the most affected, said the Delhi Traffic Police.
"I've come to buy a pair of gold bangles on Dhanteras but have been stuck here for over an hour," said 32-year-old yoga trainer, Vinita Tandon, one of the hundreds caught in a major snarl near Karol Bagh market.
Ravinder Singh, 42-year-old banker who was on his way to meet his brother and exchange gifts ahead of Diwali, said: "The usual 25-minute journey is taking over an hour."
"It would have been better if I had taken an off from office and finished the work earlier," he added.
With the festive season on till Sunday, the situation is expected to become worse over the weekend when families, friends and relatives flit from one corner of the city to another for social calls.
Wall Street ends higher after factory data; Dow, S&P up for week
By Caroline Valetkevitch
NEW YORK (Reuters) - U.S. stocks rose on Friday after surprisingly strong manufacturing data overshadowed expectations that the Federal Reserve might reduce stimulus earlier than expected.
The Dow Jones industrial average and the S&P 500 rose for the week as well, their fourth straight week of gains.
Factory activity expanded around the world, several business surveys showed, with Chinese manufacturers reporting the fastest upturn in 18 months. The Institute for Supply Management (ISM) said on Friday its index of U.S. factory activity rose to 56.4 in October, its best reading since April 2011.
While the news underscored views that the Federal Reserve may be considering scaling back its stimulus sooner than some market participants have been expecting, it also gave investors surprising evidence of the manufacturing sector's strength.
The reports "confirmed that maybe the economy isn't quite as weak or rolling over" as some expected, said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia, which manages about $58 billion in assets.
The Fed on Wednesday decided to continue its stimulus program, citing economic weakness.
Boeing Co
The Dow Jones industrial average <.dji> rose 69.80 points, or 0.45 percent, to end at 15,615.55. The Standard & Poor's 500 Index <.spx> gained 5.10 points, or 0.29 percent, to finish at 1,761.64. The Nasdaq Composite Index <.ixic> added 2.34 points, or 0.06 percent, to close at 3,922.04.
For the week, the Dow rose 0.3 percent and the S&P 500 gained 0.1 percent, while the Nasdaq slipped 0.5 percent.
On the Nasdaq, shares of First Solar Inc jumped 17.6 percent to $59.14 after the U.S. solar panel manufacturer's results beat forecasts and the company raised its full-year profit outlook.
Among decliners, shares of Chevron Corp slid 1.6 percent to $118.01 after third-quarter revenue fell short of expectations.
American International Group Inc
The latest results show the mixed picture in earnings. With about 74 percent of S&P 500 companies having reported results so far, 68.5 percent have topped Wall Street's expectations, above the long-term average of 63 percent, while just 53.3 percent have topped revenue forecasts, below the 61 percent average since 2002, Thomson Reuters data showed.
Although the three major U.S. stock indexes ended Friday's session with modest gains, the market's breadth was negative.
Decliners outnumbered advancers by a ratio of 8 to 7 on the New York Stock Exchange, while on the Nasdaq, three stocks fell for every two that rose.
(Additional reporting by Luke Swiderski Editing by Nick Zieminski and Jan Paschal)
Global Markets - Euro on the ropes after dive in inflation
By Marc Jones
LONDON (Reuters) - The euro tumbled to a two-week low on Friday after a plunge in euro zone inflation left markets suddenly eyeing the possibility of an interest rate cut by the European Central Bank next week.
European shares saw a subdued end to what looked to be a fourth week of gains, but the combination of Thursday's surprise dive in inflation to just 0.7 percent and a revitalised dollar kept the main focus on the fragile euro.
After its biggest fall in six months in the previous session, the shared currency shed a further 0.6 percent to $1.3513, leaving it flirting with its biggest weekly drop since July last year.
"It is clear that there has been a major sentiment change on the euro," said John Hardy, head of FX strategy at Saxo bank in Copenhagen.
"The ECB's single mandate has always been on inflation so this gives Draghi and co further reason to do something at next week's meeting. We see considerable further downside, the likes of euro/dollar back into the old range, down towards $1.30."
A handful of big banks including UBS, RBS and Bank of America/Merrill Lynch revised their calls saying they now expect a rate cut next week and the pressure on the euro increased after banks made their biggest repayment of ECB crisis loans since April.
The move was also amplified as the dollar continued to kick away from a recent nine-month low, boosted by upbeat U.S. data overnight that added to the debate on future Fed stimulus.
U.S. S&P E-mini futures edged up about 0.2 percent, pointing to a slightly higher start on Wall Street, after the S&P 500 Index closed down about 0.4 percent on Thursday but still gained 4.5 percent for the month.
Stock markets across Europe were between flat and down 0.5 percent ahead of the U.S. restart, pegged back by signs of third-quarter weakness at some major European firms.
At the same time, the return of bets on an ECB rate cut saw euro zone government bonds extend this week's gains.
TAPER TALK
Markets' focus remains heavily on U.S. monetary policy and how soon the Federal Reserve will begin tapering back its $85 billion a month support programme, having delayed a move in September.
The ISM survey of manufacturing for October will give investors the latest temperature reading on the state of the U.S. economy after some upbeat PMI data on Thursday.
"If the ISM report is better than expected, it could add to revived tapering expectations, and U.S. yields and the dollar could go up and stocks could go down," said Masashi Murata, senior currency strategist at Brown Brothers Harriman in Tokyo.
Not all players are convinced that this week's U.S. newsflow heralds a shift in monetary policy expectations, given the disruption caused by last month's Federal shutdown.
"The existence of noise in the October data will likely make it difficult for the Fed to gather enough evidence to start tapering in December," strategists at Barclays said in a note.
CHINA REASSURES
In Asian trading, reassuring signals on China's factory activity offered support to the region's markets, though Tokyo's Nikkei finished at a one-week low as the yen strengthened against the euro.
Among commodities, gold dropped to $1,313 an ounce leaving it at its lowest in nearly two weeks, hurt by sharp losses in the previous session from month-end profit-taking, the strong U.S. economic data and the higher dollar.
Copper got a lift from the China data, rising to $7,282 a tonne and back toward a one-week peak of $7,300 hit on Thursday. But it was not enough to help oil, with Brent falling back to $107.8 a barrel as U.S. crude slid to $95.72.
"There were reports that some of the ports in Libya were reopening and any signs that that oil is coming back online is going to hit the oil price," said Abhishek Deshpande, oil market analyst for Nataxis in London.
"There are also signs of generally lower season demand for oil at the moment as China's refineries go into maintenance."
(Additional reporting by Lisa Twaronite in Tokyo; Editing by Patrick Graham and Susan Fenton)
RBS to put problem loans in internal "bad bank"
LONDON (Reuters) - Royal Bank of Scotland is to create an internal "bad bank" to manage the run-down of its riskiest assets after the government stopped short of ordering a full break up of the state-backed bank.
The government, which owns 81 percent of RBS, wants the bank to lend more to small businesses and said the new structure should help that.
RBS said on Friday it would put 38 billion pounds of loans into a new 'capital resolution division' next year, which would free up 10-11 billion pounds of capital.
The bank said Britain's financial watchdog has made it clear in recent months it expects banks to hold more capital, making it more important to sell or run down its bad assets.
The faster run-down of assets will accelerate and increase losses on the loans, and the bank expects to take an extra impairment charge of between 4 billion and 4.5 billion pounds in the current quarter, it said.
"Under this new direction RBS will deal decisively with the problems of the past by separating out the good from the bad, and putting the bad loans in a bad bank," British finance minister George Osborne said.
RBS said it now plans to hold a core capital ratio of about 11 percent by the end of 2015 and 12 percent a year later, which is 3 percentage points above its current position.
It will accelerate the divestment of Citizens with a partial IPO planned for next year.
RBS said it was co-operating with various governments and regulators investigating foreign exchange trading activities by several banks and is reviewing communications and procedures "relating to certain currency exchange benchmark rates as well as foreign exchange trading activity". (Reporting by Matt Scuffham and William James; Editing by Steve Slater)
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