Please wait...

Reuters News

INDICATORS-Kazakhstan - Dec 22

December 22, 2014 - reuters.com

India fwd/annualised dlr premia-Dec 22

December 22, 2014 - reuters.com

SNAPSHOT-India stocks, bonds, rupee, swap, call at 0438 GMT

December 22, 2014 - reuters.com

STOCKS .BSESN .NSEI ----------------------- The benchmark BSE index up 0.15 percent and the broader NSE index 0.16 percent higher, on optimism that Prime Minister Narendra Modi may consider an executive order to pass key reform bills. ID:nL3N0U03YU .BO RUPEE INR=D2 -------------- The partially convertible rupee stronger at 63.21/22 per dollar compared with Friday's close of 63.2950/3050, tracking strength in shares. However, month-end, quarter-end demand for dollar seen weighing on rupee later in session, say traders. INR/ GOVERNMENT BONDS IN084024G=CC ------------------------------- The benchmark 10-year bond yield steady at 7.96 percent, tracking higher oil prices. Most foreign investors away in holiday-shortened week, traders say IN/ INTEREST RATE SWAPS INROIS MIOIS= ------------------------------------- The benchmark five-year rate down 2 basis points at 7.31 percent, while the one-year rate also falls 2 to 7.87 percent. CALL MONEY INROND= -------------------- The cash rate higher at 8.40/8.45 percent from Friday's close of 8.00/8.05 percent. (Compiled by Dipika Lalwani) ((Dipika.Lalwani@thomsonreuters.com; +91 22-61807098; Reuters Messaging: dipika.lalwani@thomsonreuters.com)) Keywords: INDIA SNAPSHOT/

African Markets - Factors to watch on Dec 22

December 22, 2014 - reuters.com

Vietnam domestic market commodity prices-Dec 22

December 22, 2014 - reuters.com

Dec 22 (Reuters) - Following are domestic prices of Vietnam's key commodities. Unit: million dong VND= per tonne. Item Dec 15-22 Dec 8-12 Location Robusta beans 38.6-40.0 39.0-41.2 Central Highlands Black pepper 182.0-191.0 195.0-200.0 Southern region Refined sugar 13.0-15.5 13.0-15.5 Southern region Summer-autumn paddy 5.40-6.30 5.40-6.30 Mekong Delta ___________________ SJC gold 3.520-3.530 3.516-3.538 Hanoi, HCM City NOTES: Gold prices are low/high selling prices quoted in million dong during the week by top manufacturer SJC per 3.75-gram ingot. Coffee export prices COFFEE/ASIA1 Rice export prices RICE/ASIA1 Historical data VNCOMM01 Central bank's gold auction SBVGOLD2013 ($1=21,355 dong) (Compiled by Hanoi Newsroom) ((ho.minh@thomsonreuters.com; +844 3825 9623)) Keywords: VIETNAM COMMODITIES/PRICES

MIDEAST STOCKS - Factors to watch - December 22

December 22, 2014 - reuters.com

DUBAI, Dec 22 (Reuters) - Here are some factors that may affect Middle East stock markets on Monday. Reuters has not verified the press reports and does not vouch of their accuracy. INTERNATIONAL/REGIONAL * GLOBAL MARKETS-Asian shares take cue from Wall Street's rally MKTS/GLOB * Brent crude oil prices rise over $62 as Asian markets open strong O/R * MIDEAST STOCKS-Gulf markets continue rally on oil, Saudi budget hopes ID:nL6N0U50CV * Gold struggles below $1,200 as equities, dollar gain ID:nL3N0U6031 * OPEC's Badri says hopes for oil price revival by end H2 2015 ID:nL6N0U50ES * Iraq's SOMO sees average December oil exports from Basra topping 2.6 mln bpd ID:nL6N0U508R * Iraq oil min says total production to reach 4 mln bpd ID:nL6N0U504Q * Iraqi Kurds, Yazidis fight Islamic State for strategic town of Sinjar ID:nL6N0U50KR * Essebsi declares win in Tunisia election, rival contests ID:nL6N0U502V * CNOOC's Nexen shuts Yemen facilities due to security threat ID:nL1N0U50HT * Jordan hangs 11 after eight-year death penalty freeze ID:nL6N0U50HP * Libya's official government targets rival forces trying to seize ports ID:nL6N0U50GM * Lebanon says it needs French helicopters quickly to fight jihadis ID:nL6N0U509C * Iran nuclear diplomat gets key post as head of foreign oil deals ID:nL6N0U50BG EGYPT * Egyptian pound steady on official market, weaker on black market ID:nL6N0U50CP * Egypt's Suez Canal revenue at $442.8 mln in November ID:nL6N0U50DT * Egypt retires hardline intelligence chief ID:nL6N0U5086 * Egypt's sufficient wheat supply sufficient to last until late April - minister ID:nL6N0U508T * Egypt allows in travellers from Gaza for first time since October ID:nL6N0U5066 SAUDI ARABIA * Saudi Arabia says won't cut oil output even if non-OPEC nations do ID:nL6N0U503J UNITED ARAB EMIRATES * UAE urges all world's oil producers not to raise output in 2015 ID:nL6N0U506S * Healthy Dubai real estate market can ride out cheap oil ID:nL6N0U403E KUWAIT * Kuwait oil min says OPEC does not need to cut output ID:nL6N0U50CN QATAR * Qatar oil minister says market experiencing "temporary correction" ID:nL6N0U504W BAHRAIN * Bahrain energy projects not affected by oil slide -minister ID:nL6N0U50AK * Bahrain November inflation falls to 2.2 pct y/y ID:nL6N0U502F (Compiled by Dubai newsroom) ((dubai.newsroom@reuters.com)) Keywords: MIDEAST FACTORS

Indian FX/debt factors to watch - Dec 22

December 22, 2014 - reuters.com

India Morning Call-Global Markets

December 22, 2014 - reuters.com

EQUITIES NEW YORK - U.S. stocks extended gains for a third session on Friday, giving the S&P 500 its best weekly performance in nearly two months as energy shares continued to rebound. The S&P energy index .SPNY jumped 3.1 percent, leading the benchmark index's advance, and closed out the week with a 9.7 percent gain, its biggest weekly increase since December 2011. For a full report, click on .N ---- LONDON - Britain's top equity index headed to its biggest weekly gain in two years on Friday, led by recent laggards such as insurer Aviva AV.L and Tullow Oil TLW.L as analysts recommended snapping up battered shares after a recent selloff. Fund managers and traders cited a gradual wind-down in trading activity as investors cut risk before the holiday season. British supermarket chain Tesco TSCO.L , which has been trading at depths not seen since 2003, was up 5.5 percent. For a full report, click on .L ---- TOKYO - Japanese stocks posted their best day in 6-1/2 weeks on Friday as investors continued to take heart from the U.S. Federal Reserve's "patient" approach to raising interest rates, while awaiting comments from the head of the Bank Of Japan after it held policy steady. The Nikkei benchmark .N225 ended 2.4 percent higher at 17,621.40, its biggest daily percentage gain since early November. For a full report, click on .T ---- HONG KONG - Hang Seng Index .HSI is trading 1.4 percent higher. For a full report, click on .HK ---- FOREIGN EXCHANGE SYDNEY - The euro probed fresh two-year lows early on Monday in a subdued start to a holiday-shortened week, extending a multi-month trend of weakness against the dollar that many traders say will remain intact in the new year. Speculation is high that the European Central Bank (ECB) will be forced to expand its asset-buying program to include sovereign debt in early 2015, at a time when the Federal Reserve is preparing to do the opposite and lift interest rates. For a full report, click on USD/ ---- TREASURIES NEW YORK - U.S. Treasuries yields held steady or fell on Friday on renewed appetite for bonds as a two-day scramble for stocks and other risky assets slowed. Longer-dated yields declined from one-week highs as bargain-minded traders reckoned that two days of selling and exits from flattener trades, or bets that shorter-term rates would rise faster than longer-term rates, were overdone. For a full report, click on US/ ---- COMMODITIES GOLD SINGAPORE - Gold was stuck below $1,200 an ounce on Monday, struggling to get past last week's losses, hurt by a stronger dollar and equities which dulled the metal's safe-haven appeal, and expectations of higher U.S. interest rates. Spot gold XAU= was little changed at $1,194.95 an ounce by 0023 GMT, after losing about 2 percent last week on worries over a U.S. interest rate hike next year. For a full report, click on GOL/ ---- BASE METALS SYDNEY - Copper prices inched down on Monday, reversing gains from the previous session on concerns over global oversupply. Copper is down some 13 percent so far this year on worries the market is heading into a supply surplus after several years of deficit, and on slowing economic growth in China, which consumes nearly half the world's copper. For a full report, click on MET/L ---- OIL NEW YORK - Oil closed up as much as 5 percent on Friday, its biggest gain in over two years, as some traders took profits on short positions after prices this week hit their lowest since 2009. A sharp bout of short-covering prior to expiry of the U.S. January crude oil contract alleviated pressure in a market dominated by sellers the past six months and lighter-than-usual pre-holiday volume exaggerated the rise on a day that otherwise lacked much in the way of headline news. For a full report, click on O/R (Compiled by Dipika Lalwani) ((Dipika.Lalwani@thomsonreuters.com; 022-61807098; Reuters Messaging: dipika.lalwani@thomsonreuters.com)) Keywords: MORNINGCALL INDIA/

FOREX-Euro shaky on ECB and Greece, dollar keeps edge

December 22, 2014 - reuters.com

By Ian Chua and Hideyuki Sano SYDNEY/TOKYO, Dec 22 (Reuters) - The euro probed fresh two-year lows early on Monday in a subdued start to a holiday-shortened week, extending a multi-month trend of weakness against the dollar that many traders say will remain intact in the new year. Speculation is high that the European Central Bank (ECB) will be forced to expand its asset-buying program to include sovereign debt in early 2015, at a time when the Federal Reserve is preparing to do the opposite and lift interest rates. The common currency has fallen about 11 percent so far this year. It last traded at $1.2230 EUR= , having touched $1.2220 early in the session, a low not seen since August 2012. The euro slipped to 146.17 yen EURJPY=R , holding well off a six-year high of 149.79 set early in the month. ECB governing council member Luc Coene said in a newspaper interview on Saturday that the bank should start buying government bonds to tackle poor investor confidence and low inflation in the euro zone. ID:nL6N0U40GV His comments came as Vice President Vitor Constancio reiterated that the bank would, in early 2015, assess the effectiveness of measures it had already taken. Constancio said the ECB must act if inflation was too low to maintain its credibility and would need to use channels it had not tried before. ID:nL6N0U4037 "We think extremely low euro area December inflation will support our call for further ECB easing through the announcement of European government bond purchases at its 22 January meeting," analysts at Barclay wrote in a note to clients. That would provide a catalyst for further euro/dollar depreciation next year, they said, adding the recent break lower has opened up targets around 1.2100 and 1.2040. In addition, the currency was dogged by uncertainties on Greece, which could face an early election if its parliament fails to elect a president with a three-fifths majority. Prime Minister Antonis Samaras, whose party is trailing behind anti-bailout Syriza Party in opinion polls, failed to win less votes than expected in the first round of voting last week, not boding well for two remaining rounds of voting, planned on Dec. 23 and Dec. 29. "The markets may be quiet for now due to holidays but Greek vote on Dec. 29 could really shake things up," said a trader at a Japanese bank. With the euro on the defensive, the dollar index .DXY held within striking distance of a near nine-year peak of 89.645 set on Friday. As investors expect the Federal Reserve to raise rates for the first time since the global financial crisis in 2008, the dollar index also rose above its post-crisis peak of 89.624 marked in March 2009. Still, the index could face a strong resistance at 90, with some analysts concerned that the dollar's excessive strength could reinforce disinflationary pressure in the United States. Against the yen, the greenback bought 119.43 JPY= , climbing back towards a 7-1/2 year high of 121.86 and away from a 115.56 trough plumbed last week. The Australian dollar was becalmed at $0.8144 AUD=D4 , having slumped to a 4-1/2 year low of $0.8107 last week. The lacklustre start was in sharp contrast to the wild swings in risk appetite last week sparked in part by a currency meltdown in Russia and persistent weakness in oil prices. Reassuring words from the Fed on Wednesday, which said it would not raise interest rates in the next couple of meetings, have since restored some semblance of calm. Traders, many of whom have already closed their books for the year, said thin market conditions could lead to further choppy action in the next couple of weeks. ((hideyuki.sano@thomsonreuters.com; +81 3 6441 1827; Reuters Messaging: hideyuki.sano.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

Australia & NZ dollars find some calm after turbulent times

December 22, 2014 - reuters.com

By Ian Chua and Naomi Tajitsu SYDNEY/WELLINGTON, Dec 22 (Reuters) - The Australian and New Zealand dollars struggled for momentum on Monday, having steadied from recent volatility as investors found little incentive to trade in the final two weeks of the year. Many traders have already closed their books for 2014, and thin markets make for choppy conditions that are likely to keep all but the hardiest players on the sidelines. The Aussie was flat at $0.8143 AUD=D4 , not far from a 4-1/2-year trough of $0.8107 plumbed on Wednesday. It has shed around 9 percent so far this year. "Commodity currencies, like the AUD and NZD, could remain under downward pressure until commodity prices stabilise. We see the AUD back in US$0.70s in the next few months," said John Peters, senior economist at Commonwealth Bank in Sydney. Peters said markets will remain on edge as the issues around falling commodity prices, central bank policy divergence and growth disparities across the major economies play out. Indeed, a growing number of analysts see the Aussie falling below 80 U.S. cents next year as markets continued to speculate on an interest rate cut at home, while the U.S. central bank geared up for a hike in rates. Such an outcome should please the head of the Reserve Bank of Australia, who recently flagged that fair value was around 75 cents, partly to reflect this year's 50-percent plunge in the price of iron ore, Australia's single biggest export. The New Zealand dollar eased 0.3 percent to $0.7728 NZD=D4 , off an early high of $0.7765 after data showing a drop in consumer confidence added to the view that the economy is cooling. ID:nW9N0QW01S Concerns the economy may have peaked amid a tumble in global prices for dairy products, the country's biggest export earner, have kept the kiwi in sight of a 2-1/2 year trough of $0.7660. A break there would open the door to $0.7500, analysts say. The kiwi has lost nearly 6 percent so far this year against the broadly resurgent U.S. dollar, reversing gains made when the Reserve Bank of New Zealand began raising interest rates, which now stand at 3.5 percent. New Zealand government bonds 0#NZTSY= edged up a touch, nudging yields as much as 2 basis points lower across the curve. Australian government bond futures tracked a rebound in U.S. Treasuries. The three-year bond contract YTTc1 climbed 6 ticks to 97.790, while the 10-year contract YTCc1 gained 9.5 ticks to 97.130, erasing Friday's losses. (Editing by Eric Meijer) ((ian.chua@thomsonreuters.com; +61 2 9373 1871; RM: ian.chua.thomsonreuters.com@reuters.net)) Keywords: MARKETS AUSTRALIA/FOREX

UPDATE 1-S.Korea cuts forecasts but sees improvement in 2015 on oil, stimulus

December 22, 2014 - reuters.com

* Growth forecast for 2015 lowered to 3.8 pct from 4.0 pct * Inflation expected to rise 2.0 pct in 2015 * Domestic spending seen propping up growth next year * Supplementary budget likely, structural reforms to be announced (Adds economists' comments, more details) By Christine Kim SEJONG, SOUTH KOREA, Dec 22 (Reuters) - South Korea cut its bullish growth forecasts for both this year and next but its revised projections were still seen as too optimistic, supporting expectations of an interest rate cut early next year. The Ministry of Strategy and Finance forecast on Monday the economy will grow by 3.4 percent this year, down from 3.7 percent projected in July, with private investment and sentiment turning out weaker than the government had expected. It also downgraded its 2015 growth forecast to 3.8 percent from 4.0 percent. "(An estimate of) 3.8 percent seems a bit too high. Growth next year should be similar to this year around 3.5 percent while we still see a rate cut sometime early 2015," said Kim Doo-un, an economist at Hana Daetoo Securities. Lee Chan-woo, director-general at the ministry, said sentiment among businesses and households had been weakened by uncertainties over future economic conditions, pulling down the previous forecasts. "Third-quarter growth was mainly propped up by government stimulus measures," Lee told a briefing, referring to a raft of legal revisions and new policies launched under Finance Minister Choi Kyung-hwan, dubbed "Choinomics". Expecting things to improve next year, the finance ministry sees domestic consumption rising 3.0 percent on an annual basis, which would be the fastest since the 3.7 percent growth seen in second-quarter 2011. A supplementary budget is likely to be in the works as well, economists believe, while the ministry is scheduled to soon announce structural reforms in the labour market aimed at bringing more stability to temporary jobs. "We think that if the Korean government feels the need for a supplementary budget, it will likely be announced in first-half 2015," said Ronald Man, an economist at HSBC Hong Kong. Man sees two rate cuts pending next year, and further expects the government's forecasts to be revised down throughout the year. Spending at home is expected to get a fillip from falling oil prices, a boost in welfare payments, and government plans to increase household income. The government calculates consumption will swell inflation to 2.0 percent next year, from 1.3 percent this year, with a 0.6 percent point boost coming from a hike in cigarette prices. Inflation has remained low for the past year in South Korea on low commodity and agricultural product prices, prompting worries about the economy falling into deflation, but the ministry is confident the economy will improve enough to restore price growth. (Editing by Eric Meijer) ((christine.kim@thomsonreuters.com; 822 3704 5665; Reuters Messaging: christine.kim.thomsonreuters.com@reuters.net)) Keywords: SOUTHKOREA ECONOMY/POLICY

S.Korea cuts forecasts but sees improvement in 2015 on oil, stimulus

December 22, 2014 - reuters.com

By Christine Kim SEJONG, SOUTH KOREA, Dec 22 (Reuters) - South Korea cut its bullish growth forecasts for both this year and next, but does see conditions perking up in 2015 as government stimulus measures and falling crude oil prices animate domestic consumption. The Ministry of Strategy and Finance forecast on Monday the economy will grow by 3.4 percent this year, down from 3.7 percent projected in July, with private investment and sentiment turning out weaker than the government had expected. It also downgraded its 2015 growth forecast to 3.8 percent from 4.0 percent. Lee Chan-woo, director-general at the ministry, said sentiment among businesses and households had been weakened by uncertainties over future economic conditions, pulling down the previous forecasts. "Third-quarter growth was mainly propped up by government stimulus measures," Lee told a briefing, referring to a raft of legal revisions and new policies launched under Finance Minister Choi Kyung-hwan, dubbed "Choinomics". "On top of this, the recovery in the private sector was worse than expected in October and November." Expecting things to improve next year, the finance ministry sees domestic consumption rising 3.0 percent on an annual basis, which would be the fastest since the 3.7 percent growth seen in second-quarter 2011. Spending at home is expected to get a fillip from falling oil prices, a boost in welfare payments, and government plans to increase household income. The government calculates consumption will swell inflation to 2.0 percent next year, from 1.3 percent this year. Inflation has remained low for the past year in South Korea on low commodity and agricultural product prices, leading to worries about the economy falling into deflation, although the ministry is confident that the economy will improve enough to restore price growth. In a bid to funnel wealth to households, the National Pension Service (NPS) as well as other state-run funds plan to increase their influence as major shareholders to extract bigger dividends from local companies, the ministry said. The scheme comes as the country aims to tax companies that don't plan on spending excess cash on wages, investments or dividends. NPS manages 450 trillion won in assets and is the world's fourth-biggest pension fund. As for risks as the country enters a new year, the finance ministry pointed to snowballing household debt, falling competitiveness at major manufacturers, and heightened volatility in financial markets. (Editing by Eric Meijer) ((christine.kim@thomsonreuters.com; 822 3704 5665; Reuters Messaging: christine.kim.thomsonreuters.com@reuters.net)) Keywords: SOUTHKOREA ECONOMY/POLICY

PRESS DIGEST- British Business - Dec 22

December 22, 2014 - reuters.com

The following are the top stories on the business pages of British newspapers. Reuters has not verified these stories and does not vouch for their accuracy. The Times Energy companies given 1 bln pounds to keep the lights on (http://thetim.es/1zSBUtF) Nearly 1 billion pounds ($1.56 billion) of subsidies that will add 11.40 pounds a year to household bills have been given to energy companies to help to keep the lights on. Power stations that won new money under the "capacity market" scheme in a three-day auction this week were announced by the government yesterday. AstraZeneca chief crosses fingers and plays down $45 bln vow (http://thetim.es/1AvDlOI) Pascal Soriot, Chief Executive of AstraZeneca AZN.L has said that the company will be "lucky" to hit a $45 billion sales forecast that was central to the drug company's defence against a hostile takeover by Pfizer PFE.N . He urged investors not to become fixated on the target, arguing that profit and product mix were more important. The Guardian Saudi, UAE oil ministers defend OPEC on falling oil prices (http://bit.ly/1Co7YF0) The oil ministers of Saudi Arabia and the United Arab Emirates have defended OPEC's decision not to cut production despite a glut, and blamed speculators and producers outside the cartel for the slump in prices. Rochester by-election row could affect Cameron succession (http://bit.ly/13pMJ9j) Theresa May, the home secretary, has been warned by cabinet colleagues to act as a "team player" or risk damaging her chances of succeeding David Cameron as leader of the Conservative party. The Telegraph FCA asks banks to take forex rigging fines out of bonuses (http://bit.ly/1za1HJv) The Financial Conduct Authority (FCA) has told the banks at the centre of the foreign exchange rigging scandal that their huge fines should be funded out of this year's round of bonuses. Tesco suppliers dragged into SFO investigation (http://bit.ly/1wcveA9) Leading UK suppliers to Tesco TSCO.L , including Diageo DGE.L and Unilever ULVR.L , expect to be interviewed by the Serious Fraud Office as part of its investigations into accounting practices at the troubled supermarket giant. Sky News ITE Exhibits Move From Sanctions-Hit Russia (http://bit.ly/1JDSTE4) ITE Group ITE.L , a London-listed exhibitions firm, will this week announce a 20 mln pound takeover of Breakbulk - a shipping and logistics intelligence provider, that will reduce its reliance on Russia amid the country's currency crisis and the ongoing impact of international sanctions. Ambulances May Take Twice As Long, Memo Says (http://bit.ly/1wTz1Y9) Some patients who need an ambulance may soon have to wait longer for it to arrive even if they are classed as a serious case, under new proposals seen by Sky News. ($1 = 0.6402 pounds) (Compiled by Ankush Sharma in Bengaluru; Editing by Eric Walsh) ((ankush.sharma@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 3057; Reuters Messaging: ankush.sharma.thomsonreuters.com@reuters.net)) Keywords: BRITAIN PRESS/BUSINESS

FOREX-Euro off to shaky start in subdued market, dollar holds strong

December 22, 2014 - reuters.com

* Euro on the defensive, ECB easing still a threat * ECB Coene says bank should start buying govt bonds * Markets calmer after wild week By Ian Chua SYDNEY, Dec 22 (Reuters) - The euro probed fresh two-year lows early on Monday in a subdued start to a holiday-shortened week, extending a multi-month trend of weakness against the dollar that many traders say will remain intact in the new year. Speculation is high that the European Central Bank (ECB) will be forced to expand its asset-buying program to include sovereign debt in 2015, at a time when the Federal Reserve is preparing to do the opposite and lift interest rates. The common currency has fallen about 11 percent so far this year. It last traded at $1.2221 EUR= , having touched $1.2220 early in the session, a low not seen since August 2012. The euro slipped to 146.17 yen EURJPY=R , holding well off a six-year high of 149.79 set early in the month. ECB governing council member Luc Coene said in a newspaper interview on Saturday that the bank should start buying government bonds to tackle poor investor confidence and low inflation in the euro zone. ID:nL6N0U40GV His comments came as Vice President Vitor Constancio reiterated that the bank would, in early 2015, assess the effectiveness of measures it had already taken. Constancio said the ECB must act if inflation was too low to maintain its credibility and would need to use channels it had not touched before. ID:nL6N0U4037 "We think extremely low euro area December inflation will support our call for further ECB easing through the announcement of European government bond purchases at its 22 January meeting," analysts at Barclay wrote in a note to clients. That would provide a catalyst for further euro/dollar depreciation next year, they said, adding the recent break lower has opened up targets around 1.2100 and 1.2040. With the euro on the defensive, the dollar index .DXY held within striking distance of a near nine-year peak of 89.645 set on Friday. Against the yen, the greenback bought 119.55 JPY= , climbing back towards a 7-1/2 year high of 121.86 and away from a 115.56 trough plumbed last week. The Australian dollar was becalmed at $0.8142 AUD=D4 , having slumped to a 4-1/2 year low of $0.8107 last week. The lacklustre start was in sharp contrast to the wild swings in risk appetite last week sparked in part by a currency meltdown in Russia and persistent weakness in oil prices. Reassuring words from the Fed on Wednesday, which said it would not raise interest rates in the next couple of meetings, have since restored some semblance of calm. Traders, many of whom have already closed their books for the year, said thin market conditions could lead to further choppy action in the next few weeks. (Editing by Shri Navaratnam) ((ian.chua@thomsonreuters.com; +61 2 9373 1871; RM: ian.chua.thomsonreuters.com@reuters.net)) Keywords: MARKETS FOREX/

NZ consumer confidence falls in Q4

December 21, 2014 - reuters.com

WELLINGTON, Dec 22 (Reuters) - Consumer confidence in New Zealand fell to its lowest in nearly two years during the fourth quarter, a survey showed on Monday, reflecting a fall in global dairy prices while the economy shows signs of slowing in the face of higher interest rates. The Westpac-McDermott Miller consumer confidence index fell to 114.8 from 116.7 in the previous quarter. A reading above 100 indicates more optimists than pessimists. The survey indicated that fewer consumers expect to be better off in the coming year. (Reporting by Gyles Beckford; Editing by Kevin Liffey) ((Gyles.Beckford@thomsonreuters.com; +64 4 802 7977 ; Reuters Messaging: gyles.beckford.reuters.com@reuters.net)) Keywords: NEWZEALAND ECONOMY/CONFIDENCE

China stock connect scheme scorecard throws up surprises

December 21, 2014 - reuters.com

By Saikat Chatterjee HONG KONG, Dec 22 (Reuters) - A month after China opened up its equity markets in a landmark trading link with Hong Kong, demand has been subdued and the bulk of activity has come from short-term speculative investors. The authorities had hoped mutual and pension funds and private banks would form the bedrock of the Shanghai-Hong Kong stock connect. But early trade volumes in the programme launched in mid-November were completely dominated by hedge funds and banks' proprietary trading desks, according to five traders at some of the biggest brokerages participating in the scheme. Regulatory hurdles have kept out a large swathe of the investment community - and the steady business the financial industry and regulators had hoped they would bring - despite a sizzling stock market rally on the mainland. Market players say it could take months for long-term investors to eventually trickle into the programme, as they devise ways to cope with its peculiarities. "We are not participating in the scheme yet because of the operational issues that have yet to be resolved and we prefer to access the mainland markets via exchange traded funds," Robert Cormie, Asia CEO of BMO Private Bank, told Reuters. Edmund Yun, executive director of investment at the same wealth management firm, agreed, citing a number of prohibitive issues. These include beneficial ownership, tax and trading settlement. Hedge funds use banks' prime brokerages, which help them more deftly manage those regulatory constraints. Stock portfolios of hedge funds are often held by the prime brokers themselves to facilitate quick trading decisions so they are unaffected by ownership constraints. For example, under the scheme, funds wanting to sell holdings of Shanghai-listed shares have to deliver the shares to brokers a day before they are to be sold, a peculiarity that exists in no other major stock market. While regulators have looked for ways to encourage long-term funds, including fast-tracking applications for products benchmarked under the stock connect scheme, industry officials say that persuading pension funds to participate could take months. ID:nL3N0TN18G Under the scheme, the daily limit on investment bound for Shanghai is 13 billion yuan ($2.1 billion) and for Hong Kong-bound investment it is 10.5 billion yuan. Typically, only a small portion of this has been used, and on Monday of last week, just 10 percent of the combined 23.5 billion yuan quota was used, the lowest level since the launch of the stock connect scheme. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Chart: http://reut.rs/1wDkcHU EU regulatory concerns curb China stock link vol ID:nL3N0TG4Y3 Rich values, poor rules dog HK-Shanghai stock vol ID:nL3N0TA3GO ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ SLIM PICKINGS Brokers that offer a combination of services, such as major banks HSBC Holdings HSBA.L , Standard Chartered Plc STAN.L , BNP Paribas BNPP.PA and Citibank C.N. , were expected to win the most market share under the scheme. But the regulatory uncertainty has limited their capacity to dominate flows. Banks with private wealth clients, such as UBS UBSG.VX and those with extensive hedge fund networks, such as Goldman Sachs GS.N , Credit Suisse CSGN.VX and CLSA, have grabbed early market share, traders said. That has been helped by a nearly 25 percent rise in the Shanghai Composite Index .SSEC since the scheme was launched as hedge funds have found it cheaper to buy mainland shares under the scheme than "rent quotas" from investment banks, a mechanism under which investors buy derivative products from banks who have access to onshore stocks. More worryingly for the Hong Kong Stock Exchange, the slower than expected take-up of quotas under the scheme means revenues are unlikely to get a big boost, two traders said. While the Shanghai-bound flows were heavier early on, Hong Kong-bound flows have disappointed from the start, a sales equity trader with a European bank said, as participation has been limited by stringent eligibility requirements. A CLSA survey of Chinese investors found 90 percent willing to invest in the Hong Kong market. That dropped to 20 percent, however, when a minimum investment amount of 500,000 yuan ($80,405) which the scheme currently requires, is applied. The Hong Kong stock market .HSI has also fallen more than 5 percent since the launch, reducing demand for the territory's shares. Despite the slow take-up, investors are hopeful an MSCI review in the first half next year may earmark a bigger share of mainland equities to its emerging market indexes now that one of the biggest stumbling blocks to a larger presence on the MSCI index has been eased - investor access to Chinese stocks. Until then, participation from long-term investors is expected to grow but slowly. "We expect more participation from the long-only funds in the coming months," said Nick Ronalds, head of equities at Asia Securities Industry & Financial Markets Association. ($1 = 6.2185 Chinese yuan) (Reporting by Saikat Chatterjee; Editing by Nachum Kaplan, Simon Cameron-Moore and Jacqueline Wong) ((saikat.chatterjee@thomsonreuters.com; +852 2843 6548; Reuters Messaging: saikat.chatterjee.thomsonreuters.com@reuters.net)) Keywords: HONGKONG CHINA/STOCK CONNECT

UPDATE 1-Egyptian pound steady on official market, weaker on black market

December 21, 2014 - reuters.com

(Updates with trader comment, context on black market) CAIRO, Dec 21 (Reuters) - The Egyptian pound EGP= held steady at a central bank dollar sale on Sunday but weakened on the unofficial market. The bank offered $40 million and said it had sold $37.8 million at a cut-off price of 7.1401 pounds CBEO to the dollar, unchanged from its sale on Thursday. The rates at which banks are allowed to trade dollars are determined by the results of central bank sales EGYTV3 , giving the bank effective control over official exchange rates. In the unofficial market, the pound was trading at 7.80 to the dollar, one trader said, weaker than Thursday's rate of 7.78 pounds. The pound began weakening on the black market last week after nearly two weeks of holding steady, traders said. It was not clear what caused the weakening. One trader said he thought it was due to an increased demand for dollars as people sought to settle debts and deals before the end of the year. The central bank last month pledged to eliminate the black market in the Egyptian pound after volatility resulting from a surge in commercial demand for dollars and concerns that plans to repay a deposit from Qatar would create a shortage. ID:nL6N0T958L A central bank official said on Nov. 28 that Egypt had paid back the $2.5 billion Qatari deposit. ID:nL6N0TI4FG Last month, before the bank's pledge, the pound was trading at up to 7.75 pounds per dollar on the black market. (Reporting by Maggie Fick; editing by Abigail Fielding-Smith) ((maggie.fick@thomsonreuters.com; +20 120 640 2000;)) Keywords: EGYPT FOREX/

Chinese yuan to stay basically stable, state media cites central banker

December 21, 2014 - reuters.com

BEIJING, Dec 21 (Reuters) - China's yuan, or renminbi, will stay basically stable despite fluctuations, state radio cited the deputy chief of China's central bank as saying on Sunday. The yuan CNY=CFXS has been under pressure in the past month due to increased year-end dollar demand by some firms and growing market expectations of more policy easing after the central bank made a surprise cut to interest rates in November. Such easing is seen as negative for the yuan. ID:nL3N0T317B "The renminbi has so far this year moved by about 2 percent against the U.S. dollar, not yet considered a depreciation," Yi Gang, deputy head of the People's Bank of China (PBOC), told state radio. The central bank has gradually been exiting regular intervention of the foreign exchange market, and China's foreign exchange reserve has held stable. "Judging from all angles, looking at the globalisation of the yuan ... we have all reason to believe that the exchange rate of renminbi will stay basically steady at a reasonable and balanced level," Yi said. The central bank has signaled it does not want the yuan to collapse, strengthening the official guidance rate CNY=SAEC , but traders said it has been intervening less in the spot market, which is allowed to trade 2 percent higher or lower than the midpoint on any given day. (Reporting by Chen Aizhu; Editing by Alison Williams) ((aizhu.chen@thomsonreuters.com; +8610 66271211; Reuters Messaging: aizhu.chen.reuters.com@reuters.net)) Keywords: CHINA YUAN/

Egyptian pound steady on official market, weaker on black market

December 21, 2014 - reuters.com

CAIRO, Dec 21 (Reuters) - The Egyptian pound EGP= held steady at a central bank dollar sale on Sunday but weakened on the unofficial market. The bank offered $40 million and said it had sold $37.8 million at a cut-off price of 7.1401 pounds CBEO to the dollar, unchanged from its last sale on Thursday. The rates at which banks are allowed to trade dollars are determined by the results of central bank sales EGYTV3 , giving the bank effective control over official exchange rates. In the unofficial market, the pound was trading at 7.80 to the dollar, one trader said, weaker than Thursday's rate of 7.78 pounds. (Reporting By Maggie Fick; Editing by Greg Mahlich) ((maggie.fick@thomsonreuters.com; +20 120 640 2000;)) Keywords: EGYPT FOREX/

China proposes broadening use of Yuan for trade with Russia - report

December 21, 2014 - reuters.com

BEIJING, Dec 21 (Reuters) - China's trade minister proposed more use of China's currency in settling trade with Russia in the face of a falling rouble to ensure safe and reliable trade, Hong Kong broadcaster Phoenix TV reported on Saturday. The rouble has fallen about 45 percent against the dollar this year, and suffered particularly steep falls early last week. President Vladimir Putin has declined to call it a crisis and said it would eventually rise again. ID:nL6N0U20J7 Chinese Minister of Commerce Gao Hucheng said the use of China's yuan, or renminbi, has been increasing for several years but western sanctions on Russia had made the trend more prominent, Phoenix TV said on its website news.ifeng.com. Gao said China and Russia were capable of achieving this year's trade target of $100 billion. Last year, trade between the two gained 1.1 percent at $89.2 billion, according to Chinese customs figures. "Capital investors may be more interested in a volatile stock or foreign exchange market. But in terms of concrete cooperations (between the two nations), we shall have a balanced mentality and push forward those cooperations," Gao was quoted as saying. Cooperation on energy and manufacturing projects would not be greatly affected by the situation in Russia, Gao said. China would instead focus on fundamental factors such as how the two economies complement each other, he said. For China, curtailing the influence of the dollar fits well with its ambitions to increase the influence of the yuan and eventually turn it into a global reserve currency. With 32 percent of its $4 trillion foreign exchange reserves invested in U.S. government debt, China wants to curb investment risks in the dollar. (Reporting by Chen Aizhu and Huang Kai; Editing by Robert Birsel) ((aizhu.chen@thomsonreuters.com; +8610 66271211; Reuters Messaging: aizhu.chen.reuters.com@reuters.net)) Keywords: CHINA RUSSIA/

Login required

Please note that, in order to view the full text, you must be logged-in at our system.

Please login at the easy-forex homepage (new users need registration).

Thank you.