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Asian Stocks Fluctuate as Oil Price, Shipping Rates Drop; Telstra Advances

by on March 9, 2010

By Shani Raja and Satoshi Kawano March 10 (Bloomberg) — Asian stocks fluctuated as shipping lines declined after a measure of cargo-transport-rates fell, while Australia’s largest telephone company rose on speculation it will avoid a forced break-up. STX Pan Ocean Co., South Korea’s largest bulk-shipping line, dropped 1.9 percent in Seoul, and Kawasaki Kisen Kaisha Ltd., Japan’s third-largest line, fell 1.7 percent in Tokyo after shipping rates fell for the first time in almost two weeks. BHP Billiton Ltd. , Australia’s largest oil producer, lost 0.9 percent as crude oil futures declined for a second day. Telstra Corp. climbed 2.1 percent in Sydney after a newspaper said Australia’s government may fail to force it to split. “We don’t have a strong catalyst, so I’m expecting stocks to drift without a clear direction today,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. in Tokyo. The MSCI Asia Pacific Index was little changed at 122.73 as of 10:26 a.m. in Tokyo, with about as many stocks advancing as declining. The index has risen 74 percent since March 9 last year, when it sank to its lowest level since the September 2008 bankruptcy filing of Lehman Brothers Holdings Inc. Japan’s Nikkei 225 Stock Average was little changed at 10,551.54, and no major benchmark in the Asia-Pacific region moved more than 0.6 percent. The MSCI Asia Pacific Index has risen in the past year as governments worldwide bolstered their economies through increased spending. Shares in the gauge trade at 18.6 times estimated earnings on average, compared with 15 times for the Standard & Poor’s 500 Index in the U.S. and 13 times for the Stoxx Europe 600 Index. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net ; Satoshi Kawano in Tokyo skawano1@bloomberg.net .

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Asian Stocks Fall as Commodity Prices Decline; Toyota Slumps on Sales Halt

by on January 26, 2010

By Shani Raja Jan. 27 (Bloomberg) — Asian stocks fell, led by mining and consumer companies, after commodity prices dropped and Toyota Motor Corp. said it will halt U.S. sales of models involved in a recall. Utilities and health-care shares advanced. BHP Billiton Ltd., the world’s biggest mining company, sank 1.7 percent in Sydney. United Co. Rusal Ltd. may be active when it becomes the first Russian company to trade its shares in Hong Kong today. Toyota fell 2.3 percent in Tokyo. The MSCI Asia Pacific Index dropped 0.3 percent to 119.04 as of 10:15 a.m. in Tokyo. The index slumped 5.8 percent in the previous seven days as U.S. President Barack Obama proposed measures to limit risk taking at banks and concern grew that China will rein in growth. Japan’s Nikkei 225 Stock Average lost 0.1 percent even after a government report showed the country’s exports climbed 12.1 percent in December. Australia’s S&P/ASX 200 Index fell 1.6 percent. New Zealand’s NZX 50 Index declined 0.2 percent. South Korea’s Kospi Index dropped 0.7 percent, reversing early gains, after Yonhap News reported North Korea fired artillery toward an area off its west coast that it warned ships to avoid yesterday. Futures on the U.S. Standard & Poor’s 500 Index rose 0.3 percent. The gauge lost 0.4 percent yesterday as concern the Federal Reserve may signal more plans to unwind stimulus measures overshadowed higher-than-estimated earnings and consumer confidence. Signs of a global economic recovery have driven a stock rally since March, lifting the average price of companies on the MSCI Asia Pacific Index to 1.6 times book value, near the highest level since September 2008. Sluggish Recovery The International Monetary Fund raised its global economic growth forecast yesterday to 3.9 percent in 2010 from its October projection of 3.1 percent. The IMF said the recovery in industrial nations is expected to be “ sluggish ,” burdened by rising public debt and high unemployment rates. Investors shrugged off a downgrade of Japan’s sovereign credit rating yesterday by S&P, which cited a “slower pace of fiscal consolidation” than the company had expected. BHP sank 1.7 percent to A$40.56 and Rio Tinto Group, the world’s third-largest mining company, slumped 4 percent to A$70.38. Copper futures for March delivery dropped 1.6 percent in New York yesterday, while crude oil for March delivery slid 0.7 percent. Toyota dropped 2.3 percent to 3,780 yen. To contact the reporter for this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Asian Stocks Fluctuate; Financial Companies Decline, Mining Shares Advance

January 19, 2010

By Anna Kitanaka and Shani Raja Jan. 20 (Bloomberg) — Asian stocks fluctuated as declines among financial companies overshadowed gains by mining companies and Japanese exporters. China Construction Bank Corp. sank 2 percent in Hong Kong after Chinese regulators asked some banks to limit lending. Nomura Holdings Inc. fell 2.8 percent in Tokyo after Credit Suisse Group lowered its rating on the brokerage sector. BHP Billiton Ltd. added 0.5 percent in Sydney after saying second- quarter iron-ore production rose to a record. Toyota Motor Corp. , which gets 31 percent of revenue from North America, rose 0.9 percent in Tokyo after the yen weakened against the dollar. The MSCI Asia Pacific Index lost 0.2 percent to 125.08 at 11:23 a.m. in Tokyo, after rising 0.5 percent earlier. The measure has advanced 50 percent in the past 12 months as growth in China helped the global economy emerge from the worst slowdown since World War II. “China is a critical factor in the recovery process,” said Stephen Halmarick, Sydney-based head of investment-markets research at Colonial First State Global Asset Management, which holds about $135 billion. “China’s tightening policy is telling us that growth is quite strong. If they can get more balance in their growth, that’s a positive thing.” Japan’s Nikkei 225 Stock Average gained 0.5 percent. Toyota Tsusho Corp. , an affiliate of Toyota’s, surged 8 percent after agreeing on a venture with mineral explorer Orocobre Ltd. Australia’s S&P/ASX 200 Index rose 0.3 percent. Hong Kong’s Hang Seng Index lost 1.1 percent. Shanghai’s government said a Caijing magazine report that the city may allow individuals to invest abroad is “pure fabrication.” The report drove the Hang Seng Index up by 1 percent yesterday. To contact the reporters for this story: Anna Kitanaka in Tokyo at akitanaka@bloomberg.net .

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Most Asian Stocks Advance, Led by BHP, Commodity Producers; Banks Retreat

December 16, 2009

By Masaki Kondo and Akiko Ikeda Dec. 17 (Bloomberg) — Most Asian stocks gained as commodity producers advanced on higher oil and metal prices, overshadowing losses by financial companies after National Australia Bank Ltd. said it will sell stock. BHP Billiton Ltd. , the world’s biggest mining company, added 1.3 percent. James Hardie Industries NV, the top seller of home siding in the U.S., rose 2.1 percent in Sydney after a U.S. government report showed housing starts increased. AXA Asia Pacific Holdings Ltd. soared 12 percent after National Australia Bank said it agreed to buy AXA Asia’s Australian and New Zealand businesses. Shares of National Australia Bank were suspended from trading after the lender said it will sell A$1.5 billion ($1.3 billion) in stock to help fund the purchase. About six stocks rose for every four that dropped on the MSCI Asia Pacific Index , which added 0.1 percent to 119.69 as of 9:56 a.m. in Tokyo. The gauge has jumped 33 percent in 2009, set for its biggest annual gain since 2003. “The U.S. data showed business sentiment is improving,” said Mitsushige Akino , who oversees the equivalent of $450 million at Tokyo-based Ichiyoshi Investment Management Co. “There will be a tug of war between improvement in business confidence and contraction of excess liquidity.” Australia’s S&P/ASX 200 Index rose 0.5 percent, while Japan’s Nikkei 225 Stock Average advanced 0.5 percent. The Kospi Index fell 0.2 percent in Seoul. Interest Rates In New York, the Standard & Poor’s 500 Index added 0.1 percent after the Federal Reserve repeated its pledge to keep interest rates “exceptionally low” for an “extended period.” “Deterioration in the labor market is abating,” the Federal Open Market Committee said in a statement after meeting in Washington. “Household spending appears to be expanding at a moderate rate, though it remains constrained by a weak labor market, modest income growth, lower housing wealth, and tight credit.” Builders broke ground on 574,000 homes in November, an 8.9 percent annualized increase from the prior month, the Commerce Department said in Washington. A Labor Department report showed consumer prices excluding food and energy were unchanged, compared with a median forecast for a 0.1 percent increase in a Bloomberg News survey of 79 economists. The London Metals Index , a measure of six metals including copper and zinc, climbed 2.3 percent yesterday. Crude oil for January delivery jumped 2.8 percent to $72.66 a barrel in New York, rising the most in a month. To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net ; Akiko Ikeda in Tokyo at iakiko@bloomberg.net .

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Rio Tinto Names New Iron Ore Negotiator, Boosting Prospects for Settlement

December 10, 2009

By Rebecca Keenan and Jesse Riseborough Dec. 11 (Bloomberg) — Rio Tinto Group , the second-largest iron ore exporter, appointed a new chief negotiator with Asian steel mills after the failure this year of price talks with China, boosting prospects for the latest talks. Danny Goeman will become marketing general manager of Rio’s Asian iron ore unit, Nick Cobban , spokesman for the London-based company, said yesterday. China detained four Rio executives including Stern Hu , the head of its ore unit in China, in July for allegedly stealing commercial secrets and bribery. The four-decade old annual benchmark iron ore pricing system was fractured this year after Chinese mills, the biggest consumers, failed to reach agreement with the three largest suppliers. With a new team at Rio and with Baosteel Group, China’s biggest mill, returning as lead Chinese negotiator, there’s now greater chance of a deal, Glyn Lawcock , head of resource research at UBS AG in Sydney, said today. “It’s time to shuffle out the old team and bring in a new team,” said Lawcock, the top-rated analyst on Rio’s Australian stock this past year, according to data compiled by Bloomberg. “There is a willingness on the Chinese steel side, in our view based on our visit up there last month, to settle a price this year.” Rio gained 0.4 percent to A$70.09 at 11:10 a.m. Sydney time on the Australian stock exchange. BHP Billiton Ltd. , the world’s biggest mining company and the third-largest iron ore supplier, rose 0.7 percent to A$40.24. Rio de Janeiro-based Vale SA is the No. 1 iron ore exporter. Lead Negotiator China this year demanded a bigger price cut for iron ore than the 33 percent offered to Japanese and Korean mills by Rio and BHP. The China Iron & Steel Association, which led the last round of talks, said in October it will seek to set prices separately from the rest of the world as imports and cash prices surged. Lawcock said Baosteel told UBS it would be taking over the lead in the talks in consultation with the association. Rio needs to hear from Baosteel and CISA “as to exactly what is their view in relation to prices,” Sam Walsh , chief executive officer of Rio’s iron ore unit, said Nov. 2. China may use a new pricing mechanism for contracts in 2010, he said. Goeman will report to Will Malaney , who previously led the iron ore talks for Rio. UBS, Goldman Sachs JBWere Pty and RBC Capital Markets have forecast a 20 percent gain in contract prices this year amid a rebound in demand from Asian buyers. To contact the reporters on this story: Rebecca Keenan in Melbourne at rkeenan5@bloomberg.net ; Jesse Riseborough in Melbourne at jriseborough@bloomberg.net

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Asian Shares Fall for Fourth Day on Chip-Stock Downgrade, Commodity Prices

November 19, 2009

By Masaki Kondo and Akiko Ikeda Nov. 20 (Bloomberg) — Asian stocks fell, dragging the MSCI Asia Pacific Index to its longest losing streak in more than four months, after Merrill Lynch & Co. cut its outlook on the global semiconductor industry and commodities retreated. Advantest Corp. , the world’s biggest maker of memory-chip testers, lost 2.6 percent in Tokyo. Sony Corp. , the maker of the PlayStation 3 game machine, slid 2.8 percent after pushing back its profitability targets by two years. BHP Billiton Ltd., the world’s biggest mining company, slid 1.6 percent, snapping a four-day advance, after oil and metal prices fell. “It seems investors are rushing to sell off stocks,” said Juichi Wako , a senior strategist at Tokyo-based Nomura Holdings Inc. “Since sentiment is bad, any news could drag shares lower.” The MSCI Asia Pacific Index fell 0.3 percent to 117.14 as of 10:02 a.m. in Tokyo. The gauge is headed for a fourth day of declines, the longest losing streak since July 8. The index has dropped 0.9 percent this week. Japan’s Nikkei 225 Stock Average retreated 0.4 percent. The S&P/ASX 200 Index dropped 1.3 percent in Sydney. Futures on the Standard & Poor’s 500 Index dipped 0.1 percent. The index retreated 1.3 percent yesterday, the most since Oct. 30. Intel Corp. and Texas Instruments Inc., the second-largest U.S. chipmaker, slumped after Bank of America Corp.’s Merrill Lynch unit cut its ratings on the chipmakers. OECD Forecasts “There’s a growing disparity between supply growth and consumption, therefore the downside risk to earnings is increasing,” Dan Heyler , Hong Kong-based head of Asian semiconductor research, said yesterday. “We think the supply chain will be aggressively replenished through to March.” He cut Taiwan Semiconductor Manufacturing Co. , the world’s largest custom chipmaker, to “neutral” from “buy,” and United Microelectronics Corp. to “underperform” from “buy.” Crude oil for December delivery retreated for the fist time in four days yesterday, plunging 2.7 percent to $77.46 a barrel in New York. The London Metals Index , a measure of six metals including copper and zinc, sank 1.5 percent. Stocks around the world have rallied since March amid signs the global economy is recovering from its worst slowdown since World War II. The Organization for Economic Cooperation and Development doubled its growth forecast for the leading developed economies next year to 1.9 percent, the Paris-based organization said in a report yesterday. The MSCI Asia Pacific Index has climbed 31 percent in 2009, outpacing gains of 21 percent by the Standard & Poor’s 500 Index and 24 percent for Europe’s Dow Jones Stoxx 600 Index. Stocks in the Asian gauge are valued at 22 times estimated earnings, compared with 17 times for the S&P and 15 times for the Stoxx. To contact the reporters for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net ; Akiko Ikeda in Tokyo at iakiko@bloomberg.net .

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Asian Stocks Gain as Commodity Prices Rise; Sharp Climbs on Broker Upgrade

November 17, 2009

By Akiko Ikeda and Toshiro Hasegawa Nov. 18 (Bloomberg) — Asian stocks rose, led by mining and technology companies, as commodities prices increased and a brokerage boosted its investment rating on Sharp Corp. BHP Billiton Ltd. , the world’s No. 1 mining company, gained 1.9 percent in Sydney after oil and metal prices advanced. to S$1.13. STX Pan Ocean Co. , South Korea’s biggest bulk carrier, rose 0.8 percent after the Baltic Dry Index of shipping rates climbed for a 14th day. Sharp, Japan’s largest maker of liquid- crystal displays, added 1.5 percent after JPMorgan Chase & Co. lifted the stock to “neutral” from “underweight.” “The increase in commodity prices and the 14th straight gain for the Baltic Dry Index show the global economy is recovering, even though the recovery lacks strength,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. in Tokyo. The MSCI Asia Pacific Index added 0.3 percent to 119.05 as of 9:51 a.m. in Tokyo. The gauge has climbed 69 percent from a more than five-year low on signs of a global economic recovery. Japan’s Nikkei 225 Stock Average advanced 0.5 percent to 9,780.21. Australia’s S&P/ASX 200 Index rose 1 percent and South Korea’s Kospi Index climbed 1.5 percent. In New York, the Standard & Poor’s 500 Index added 0.1 percent yesterday, buoyed by commodity companies as gold and copper climbed, and crude oil rose for a second day to $79.14 a barrel. In London, the Baltic Dry Index , a measure of shipping rates for commodities, advanced for a 14th day to the highest since September 2008. The MSCI Asia Pacific Index has climbed 33 percent this year, on course for its steepest annual increase since 2003. It has outpaced gains of 23 percent by the S&P 500 and 26 percent for Europe’s Dow Jones Stoxx 600 Index. Stocks in the Asian benchmark are valued at 22 times estimated earnings, compared with 18 times for the S&P and 16 times for the Stoxx. To contact the reporters for this story: Akiko Ikeda in Tokyo at iakiko@bloomberg.net ; Toshiro Hasegawa in Tokyo at thasegawa6@bloomberg.net .

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Video: Scout Investment’s James Moffett Likes Vale, BHP, AmBev: Video

November 13, 2009

Nov. 13 (Bloomberg) — James Moffett, fund manager at Scout Investment Advisors, talks with Bloomberg’s Carol Massar and Matt Miller about the outlook for stocks and his equity picks. Moffett says he likes BHP Billiton Ltd., Vale SA and Cia de Bebidas das Americas, which is also known as AmBev. (Source: Bloomberg)

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Asian Stocks Decline on U.S. Housing Starts, Commodity Prices; BHP Falls

October 20, 2009

By Masaki Kondo and Kana Nishizawa Oct. 21 (Bloomberg) — Asian stock s declined, led by materials and consumer companies, on worse-than-forecast U.S. housing starts and declines in commodity prices. James Hardie Industries NV , the biggest seller of home siding in the U.S., lost 2.4 percent in Sydney. BHP Billiton Ltd. , the world’s largest mining company, sank 1.1 percent as a gauge of metals in London fell from a two-month high. Toshiba Corp. , the world’s second-biggest maker of flash memory chips, gained 2.5 percent after U.S. rival SanDisk Corp. forecast sales that beat analysts’ estimates. The MSCI Asia Pacific Index lost 0.3 percent to 120.76 as of 10:10 a.m. Tokyo time. The gauge has surged 71 percent from a five-year low on March 9 amid signs the global economy is rebounding from the worst slowdown since World War II. “Stocks are set for a slight dip at the start of trading as U.S. investors were put off by the housing numbers and are starting to become cautious after the recent rally,” said Hiroichi Nishi , an equities manager at Nikko Cordial Securities Inc. in Tokyo. “The market will be focused on companies that are lifting their earnings outlooks.” Japan’s Nikkei 225 Stock Average fell 0.2 percent, while Australia’s S&P/ASX 200 Index dropped 0.4 percent. Futures on the Standard & Poor’s 500 Index dropped 0.1 percent. The gauge sank 0.6 percent yesterday as a Commerce Department report showed housing starts rose 0.5 percent in September, missing economists’ estimates. James Hardie James Hardie lost 2.4 percent to A$7.39. Sony Corp., which makes the PlayStation 3 game console, fell 1.1 percent to 2,625 yen on concern demand for electronic products will fall in the U.S. Shin-Etsu Chemical Co. , which makes silicon wafers used in semiconductors, sank 1.3 percent to 5,350 yen. Better-than-estimated economic and earnings figures have driven the MSCI Asia Pacific Index’s seven-month rally. Stocks in the gauge are priced at 23 times estimated earnings, compared with an average of 18 times in the past three years. BHP, Australia’s largest oil producer, dropped 1 percent to A$39.51. Crude oil for December delivery fell for the first time in nine days yesterday, losing 0.5 percent to $79.09 a barrel in New York. The London Metals Index, a measure of six metals including copper and zinc, fell 1 percent, retreating from a two-month high. Toshiba gained 2.7 percent to 539 yen. After the close of U.S. trading, SanDisk, the biggest maker of flash-memory cards used in digital cameras and mobile phones, said fourth-quarter sales will probably be between $1.1 billion and $1.2 billion, compared with analysts’ estimates for $835.4 million. The shares surged 9.5 percent in late trading. To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net ; Kana Nishizawa in Tokyo at knishizawa5@bloomberg.net .

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Asian Stocks Fall to One-Month Low on Growth Concerns; BHP, Panasonic Drop

October 1, 2009

By Masaki Kondo and Kotaro Tsunetomi Oct. 2 (Bloomberg) — Asian stocks fell, dragging the MSCI Asia Pacific Index to a one-month low, as concerns the economic recovery will falter caused commodity prices to slump. BHP Billiton Ltd. , the world’s biggest mining company, sank 2.8 percent in Sydney. Nissan Motor Co. , which gets 36 percent of its sales in North America, retreated 4.3 percent in Tokyo after worse-than-estimated U.S. manufacturing and jobless claims reports. Panasonic Corp. , Japan’s largest maker of home appliances, declined 3.6 percent after Mizuho Securities Co. cut its recommendation on the stock. The MSCI Asia Pacific Index lost 1.7 percent to 114.85 as of 10:19 a.m. in Tokyo, set for the lowest close since Sept. 7. The gauge has lost 2.5 percent this week. It has climbed 59 percent in the past seven months as lower borrowing costs and spending packages dragged economies out of recessions. “Expectations about the economic outlook have been too high,” said Juichi Wako , a senior strategist at Tokyo-based Nomura Holdings Inc. “For now, we have nothing that can lift the market.” Japan’s Nikkei 225 Stock Average slumped 2.4 percent, while Australia’s S&P/ASX 200 Index sank 1.9 percent. Taiwan’s Taiex Index lost 1.2 percent. South Korea is closed for a holiday. Futures on the Standard & Poor’s 500 Index dropped 0.2 percent. The gauge sank 2.6 percent yesterday after the Institute for Supply Management’s factory gauge decreased in September, while economists had forecast it would rise. A separate government report showed the number of Americans filing first-time claims for unemployment benefits increased last week by more than economists had estimated. The MSCI Asia Pacific Index is headed its biggest weekly decline in more than a month as a Bank of Japan survey showed companies planned to further cut investment, while U.S. economic data missed economist estimates. The MSCI gauge this week completed its second quarterly decline, falling 14 percent in the three months through Sept. 30. To contact the reporter for this story: Masaki Kondo in Tokyo at mkondo3@bloomberg.net ; Kotaro Tsunetomi in Tokyo at ktsunetomi@bloomberg.net .

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Fortescue Misses Its $6 Billion China Deadline to Secure Expansion Funding

September 29, 2009

By Rebecca Keenan and Jesse Riseborough Sept. 30 (Bloomberg) — Fortescue Metals Group Ltd., Australia’s third-largest iron ore exporter, missed today’s deadline to raise $6 billion in funding from Chinese lenders to finance expansion and ease a cash squeeze. “Fortescue intends to continue working co-operatively” with the China Iron & Steel Association, Perth-based Fortescue , controlled by billionaire Andrew Forrest , said today in a statement. The deadline was part of the company’s funding and pricing agreement last month with CISA and Baosteel Group Corp. China, the world’s biggest buyer of the ore, has invested in more than $56 billion of projects globally to try to reduce dependence on Vale SA , Rio Tinto Group and BHP Billiton Ltd., the world’s three-biggest exporters. Fortescue plans to use the funds to more than double exports by 2012. Fortescue dropped 3.9 percent to A$3.75 at 10:22 a.m. in Sydney on the Australian stock exchange. To contact the reporters on this story: Rebecca Keenan in Melbourne at rkeenan5@bloomberg.net Jesse Riseborough in Melbourne at jriseborough@bloomberg.net

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Australian Stock Futures Drop as Oil, Metal Prices Fall; BHP May Decline

September 21, 2009

By Shani Raja Sept. 22 (Bloomberg) — Australian stock futures fell as a measure of metals prices slipped and crude oil recorded its biggest decline in a week in New York. Australia’s S&P/ASX 200 Index futures contract due in December dropped 0.3 percent at 6:58 a.m. in Sydney today, after the benchmark S&P/ASX 200 Index dipped 0.3 percent to 4,677.40 yesterday. The Bank of New York Australia ADR Index lost 1.7 percent, while New Zealand’s NZX 50 Index fell 0.2 percent in Wellington. “Gone are the days when markets were merely rising on less-bad news,” said Ben Potter , a research analyst at IG Markets in Melbourne. “Investors are demanding concrete evidence that companies can grow top-line earnings rather than simply cut costs. Valuation concerns are also beginning to creep into the market.” New York-traded securities of BHP Billiton Ltd., the world’s biggest mining company, lost 2.1 percent after a measure of metals traded in London fell for a second day. Rio Tinto Group , the world’s third-largest mining company, declined 3.4 percent in London trading. Woodside Petroleum Ltd., Australia’s second-biggest oil and gas producer, may drop after crude dropped below $70 a barrel. In New York, the Standard & Poor’s 500 Index fell 0.3 percent to 1,064.66 on speculation a six-month rally has outpaced prospects for profit growth, even as the index of U.S. leading economic indicators rose for the fifth straight month. Strict Criteria “We are never out of the woods,” said Donald Gimbel , senior managing director of Carret & Co., which manages $1.5 billion in assets. “One has to buy quality companies that aren’t overvalued. It sounds simple, but it takes work to find stocks that meet our strict criteria.” Crude oil for October delivery fell 3.2 percent in New York yesterday to settle at $69.71 a barrel, the biggest drop since Sept. 11, as a stronger dollar and declining equity markets reduced investor demand. A gauge of six metals in London lost 0.1 percent yesterday, extending a 2.9 percent slump on Sept. 18, while gold fell for the third straight session. Newcrest Mining Ltd. may rise after the Australian newspaper reported its O’Callaghans deposit in Western Australia could become the world’s biggest tungsten mine by 2013. Newcrest could mine about 4,800 tonnes of tungsten concentrate a year from the mine for at least eight years from 2013, the newspaper said, citing a Newcrest presentation from a recent industry conference. Macquarie Group Ltd., Australian biggest investment bank, may be active. The company may pay back the A$345 million ($280 million) fee it is set to receive for ending ties with Macquarie Airports Ltd. if the plan raises debt costs for the affiliate. To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net .

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Australian Unemployment to Increase, Boosting Need for Stimulus, Swan Says

September 12, 2009

By Jason Scott Sept. 13 (Bloomberg) — Australia’s unemployment rate will increase from 5.8 percent amid the global financial crisis, boosting the need to maintain the government’s economic stimulus measures, Treasurer Wayne Swan said. “Unfortunately unemployment will continue to rise,” Swan said in his weekly economic note released today. “We know that the government’s action, and the combined efforts of employers and employees, have helped cushion the impact of the global recession on jobs. Ripping the stimulus out prematurely would only pull the rug out from under the recovery, undermine confidence and threaten jobs.” Australian employment fell in August by almost twice as much as economists estimated, adding to signs the economy may slow in coming months. Other reports last week showed retail sales unexpectedly fell in July and home-loan approvals ended a record nine-month run of gains as the effect of government stimulus spending waned. “These figures are a sobering reminder that we’ve got a long way to go,” Swan said today. “While Australia has performed much better than the rest of the world, we still face a big jobs challenge ahead.” The number of people in Australia employed dropped 27,100 from July, when it rose a revised 33,700, the statistics bureau said Sept. 10. The median estimate of 21 economists surveyed by Bloomberg was for a decline of 15,000. Full-time jobs dropped around 30,800 in August as companies including BHP Billiton Ltd. cut workers amid the global recession that has eroded demand for exports of iron ore and coal. Part-time work increased about 3,800. Eroding Spending BHP, the world’s largest mining company, said on Aug. 25 it will cut 70 jobs at its Mt. Keith nickel project in Western Australia. Huntsman Corp., a U.S.-based chemical maker, said last week it will close a plant in Melbourne, shedding 325 jobs. The drop in employment may also erode consumer spending that helped Australia’s economy expand in the second quarter at the fastest pace in more than a year. Gross domestic product gained 0.6 percent in the second quarter from the previous three months, when it grew 0.4 percent. Domestic demand has been stoked by the decision of central bank Governor Glenn Stevens to slash the overnight cash rate target by 4.25 percentage points between September 2008 and April this year. Cash Handouts The government has issued A$20 billion ($17 billion) in cash handouts to consumers and increased grants to first-time home buyers in a so-far successful bid to avoid recession. The government is also spending A$22 billion on new roads, railways, ports and schools. “It is clear that what makes the stimulus greater than the sum of its parts is the positive impact it has had on confidence in the economy,” Swan said today. “Australia has not been immune from the recession. Unemployment has risen and will continue to rise as the global recession plays out.” Stimulus from governments also helped lift Germany out of its worst recession since World War II, a report showed on Aug. 25. Europe’s largest economy grew 0.3 percent from the first quarter following four quarters of contraction. France’s economy the second biggest in the euro region, unexpectedly exited a yearlong recession, gaining by the same amount as Germany. By contrast, the U.K.’s economy shrank 5.5 percent in the second quarter, the most since records began in 1955, and U.S. GDP dropped 1 percent. To contact the reporter on this story: Jason Scott in Perth at Jscott14@bloomberg.net ;

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Asian Stocks Rise on Australian Business Confidence, Computer Chip Prices

September 7, 2009

By Patrick Rial Sept. 8 (Bloomberg) — Asian stocks rose, led by banks and technology companies, as Australian business confidence jumped to the highest in almost six years and computer memory prices gained. National Australia Bank Ltd. climbed 3.3 percent in Sydney. Elpida Memory Inc., Japan’s largest maker of dynamic random access memory, rose 2.7 percent after the benchmark price for chips climbed to the highest since August 2008. BHP Billiton Ltd., the world’s largest mining company, climbed 1.4 percent in Sydney after a metals gauge in London rose to a one-week high. The MSCI Asia Pacific Index rose 0.4 percent to 114.64 as of 12:11 p.m. in Tokyo, with about nine stocks advancing for every eight that fell. The gauge has climbed 62 percent from a more than five-year low on March 9 on speculation stimulus measures worldwide will revive the global economy. To contact the reporter for this story: Patrick Rial in Tokyo at prial@bloomberg.net ; Masaki Kondo in Tokyo at mkondo3@bloomberg.net .

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BHP Billiton Says `Business as Usual’ in China Amid Arrests of Rio Staff

August 16, 2009

By Robert Fenner Aug. 16 (Bloomberg) — BHP Billiton Ltd. , the world’s largest mining company, said it’s “business as usual” in China after the arrest of four employees of rival Rio Tinto Group. “Nothing has changed for us, we continue to sell into China and we’re committed to our customers there,” Chief Financial Officer Alex Vanselow told the Australian Broadcasting Corp. today. “For us it’s business as usual.” Stern Hu , an Australian citizen who heads Rio’s iron ore business in China, and three colleagues face charges of bribery and stealing commercial secrets from the nation’s steel industry. China is the destination for half of the world’s $52 billion global seaborne iron ore trade. “Both companies have very high standards of integrity in the way we do business,” Vanselow said. “In BHP we have a code of conduct that we take very closely and very dearly and it’s renewed every year.” Vanselow said staff from BHP’s China offices haven’t been requesting leave to return to Australia. BHP Billiton shares closed Aug. 14 at A$38.26 and have gained 26 percent this year. The company last week reported a 65 percent decline in second-half profit after metal prices and demand plunged during the global recession. Net income fell to $3.26 billion for the six months ended June 30, from $9.4 billion a year ago. Vanselow said more transparent global pricing for iron ore may limit the risk of breaching secrets rules in China and other countries. While many commodity prices are set through exchanges such as the London Metal Exchange, iron ore producers typically negotiate new contact prices directly with their major customers. “Nobody is asking how we are negotiating copper prices into China because there is a pricing mechanism that’s global,” Vanselow said. “I’m saying transparent prices are for everybody’s benefit and create a situation where this type of question wouldn’t even be possible.” To contact the reporter on this story: Robert Fenner in Melbourne rfenner@bloomberg.net

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Crude Steel Production in China Jumps 13% to Record on Building Revival

August 10, 2009

By Bloomberg News Aug. 11 (Bloomberg) — Crude steel production in China, the world’s biggest maker, jumped 13 percent last month to a record as the nation’s $586 billion stimulus package spurred demand from builders and carmakers. Output rose to 50.7 million metric tons in July, the National Bureau of Statistics said today at a briefing in Beijing. That’s the third consecutive record monthly high, according to Bloomberg data . Benchmark Chinese steel prices have soared 30 percent since April, and Baosteel Group Corp . can’t meet “explosive” demand, JPMorgan Chase & Co. said. The steel revival has hampered China’s ability to bargain down iron ore prices paid to Rio Tinto Group , Vale SA and BHP Billiton Ltd., and suggests imports of the raw material will keep rising. Steel production rose 2.9 percent to 317 million tons in the first seven months from a year ago, the statistics bureau said. China’s steel output may exceed 500 million tons this year, the China Iron and Steel Association said July 31, beating an earlier projection of 460 million tons. — Eugene Tang , Helen Yuan . Editor: Tan Hwee Ann To contact the Bloomberg News staff on this story: Helen Yuan in Shanghai at hyuan@bloomberg.net ; Eugene Tang at eugenetang@bloomberg.net

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Japanese Phone, Australian Resource Shares Advance in New York; NTT Gains

August 5, 2009

By Masaki Kondo Aug. 6 (Bloomberg) — Japanese phone and Australian resource companies rose in New York trading after Nippon Telegraph & Telephone Corp.

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China Says Iron Ore Producers `Distorted’ Market With Massive Spot Sales

July 30, 2009

By Bloomberg News July 31 (Bloomberg) — China , the world’s largest consumer of iron ore, said suppliers of the steelmaking material have “distorted” the market and disrupted annual contract talks by “massive” selling on the cash market. Spot iron ore accounted for about 83 percent of imports this year, the China Iron & Steel Association said today in a statement issued in Beijing

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Most Asian Stocks Rise; Funai Advances, National Australia Bank Declines

July 22, 2009

By Masaki Kondo and Patrick Rial July 23 (Bloomberg) — Most Asian stocks fell, led by shippers, as cargo rates sank. Manufacturers relying on U.S.

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