Nestle cuts full-year outlook after sales miss

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Nestle, the world’s largest packaged food company, lowered its full-year outlook on Friday, as a Maggi noodle recall in India knocked sales and undercalculated US Skin Health rebates weighed on the Swiss company’s profits.

Sales dropped 2.1 percent to 64.9 billion Swiss francs (USD 68 billion) in the nine months through September, missing analysts’ average forecast of 65.9 billion in a Reuters poll.

Organic or underlying growth, adjusted for currency swings, acquisitions and divestitures, slowed to 4.2 percent in the period from 4.5 percent in the first half, sliding further behind its 5 percent target for 2015.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Here’s where Asia’s rich are putting their money

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian equities extend gains on firm US lead

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian equities cruised higher on the final trading day of the week, encouraged by an impressive lead from Wall Street.

Major US averages rallied more than 1 percent overnight, thanks to a jump in financials and soft economic data that bolstered the case for a delay in the rise of US interest rates.

The Dow Jones Industrial Average and S&P 500 recovered to close above the psychologically key levels of 17,000 and 2,000 respectively. The Nasdaq Composite jumped 1.8 percent on Thursday.

Mainland stocks rise

Share markets in China kicked off trade on a positive note, with the Shanghai Composite opening 0.7 percent higher.

The CSI300 Index rose 0.8 percent, while small-caps continued to outperform with the Shenzhen Composite elevating 1.1 percent. Meanwhile, Hong Kong’s Hang Seng index charged up 1.2 percent at the start of trade.

Bucking the uptrend, Wynn Macau shares receded 5 percent after the casino and hotel operator announced a fall in profit for the three months to September. Wynn attributed the decline in net income to a sharp slowdown at its Macau operations.

Nikkei up 1.5 percent

Japan’s Nikkei 225 index extended gains amid a broad-based rise on Friday, thanks to fresh weakness in the yen.

Blue-chip exporters such as Sony and Canon climbed 2.6 and 1.9 percent respectively, while automakers Toyota, Nissan and Suzuki Motoralso attracted buy orders, up nearly 2 percent each.

Suntory Beverage & Food will unwind its joint venture with Tsingtao Brewery amid stalling sales in the fiercely-competed Chinese market, the Nikkei business daily reported. Shares of the beverage conglomerate advanced 1.7 percent.

ASX rises 0.9 percent

Australia’s S&P ASX 200 index touched its highest levels since August 28.

Commonwealth Bank of Australia and National Australia Bank rose 1.9 and 1.4 percent respectively, while Australia and New Zealand Banking gained nearly 1 percent. The gains come despite the Reserve Bank of Australia (RBA) issuing a warning in its biannual Financial Stability Review that lending standards for home loans had been looser than first thought, adding to the risks of an eventual downturn in the housing market.

Aditya Birla Minerals soared 31 percent, thanks to a surprise takeover bid from Perth-based Metals X.

Rio Tinto pared gains to slip 0.4 percent, after the global miner announced a 17 percent rise in third-quarter iron ore shipments to 91.3 million tonnes and said it remained on track to meet full-year guidance of 340 million tonnes. Shares of BHP Billiton edged down 0.2 percent, tracking a fall in its U.S. ADR on the back of falling iron ore prices.

Kospi flat

South Korea’s Kospi index swiftly reversed a higher open, as losses in heavyweight components offset gains in the broader market.

Samsung Electronics nudged down 0.3 percent, while Hyundai Motor plunged nearly 2 percent.

Pharmaceuticals were the outperformers in early trade, with Hanmi Pharmaceutical leading gains by surging 3.6 percent. The sub-index rose 1.4 percent from the get-go.

Rest of Asia

Taiwan’s weighted index ticked up 0.2 percent, as a near 3 percent slump in large-cap Taiwan Semiconductor Manufacturing Co. capped the bourse’s advances.

Shares of TSMC plummeted 2.9 percent after the world’s biggest contract chip maker reported its first quarterly earnings decline since 2012 on Thursday. TSMC also projected lower revenue for the fourth quarter and cut its capital spending estimate for this year.

Singapore’s Straits Times index bounced up 0.9 percent after September exports unexpectedly rose from a year earlier.

The country’s non-oil domestic exports (NODX) gained 0.3 percent on-year, beating expectations for a 3.6 percent decline. This unexpected rise comes on the back of an 8.4 percent slide in August and 0.7 percent slip in July.

“While the NODX data showed a month-on-month bounce, helped by a stronger rebound in exports to Japan, the global backdrop for exports remains difficult due to the slowdown in China and the weakness of global emerging markets,” Rajiv Biswas, Asia-Pacific chief economist for IHS Global Insight, wrote in a note issued early Friday.

“The regional impact and further shockwaves to Singapore’s economy depends on how much and how fast China’s economy slows down with IHS assessing the risk of a China hard landing at around 25 percent probability,” Biswas added.

Singapore narrowly avoided a technical recession on Tuesday, when third-quarter gross domestic product (GDP) showed the Southeast Asian economy expanded 0.1 percent on-quarter.

Malaysia’s FTSE Bursa Malaysia KLCI added 0.3 percent ahead of the announcement of September inflation numbers at noon.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Volkswagen to recall around 8.5 mn cars in Europe

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Volkswagen said it would recall around 8.5 million diesel-engine cars in the European Union (EU) after Germany requested servicing of the vehicles following a scandal over rigged emissions tests.

VW said on Thursday that it would need to be determined outside the 28-nation EU which classes of engine EA 189 were affected. The latest engine generation EA 288 is not affected, it said.

This came after Germany’s automotive watchdog, the Federal Motor Transport Authority, ordered Volkswagen to recall 2.4 million vehicles, according to Reuters news agency on Thursday morning.

The watchdog rejected the voluntary recall of vehicles put forward by Volkswagen in a plan submitted this month, according to German newspaper Bild which first reported the news.

Billions of euros have been wiped off Volkswagen’s value following the revelation that the company had used software to change its diesel engines’ performance under US test conditions.

The company last week withdrew applications for approval to sell 2016 diesel car car models in the US, the Associated Press reported, after it admitted the cars contain emissions software “that would potentially help their exhaust systems run cleaner during government tests.”

Also on Thursday, Italian police are reported to be searching the headquarters of sports car maker Lamborghini, according to Reuters which has cited an investigative source.

This is part of the criminal investigation into alleged commercial fraud by parent company Volkswagen, the news agency.

It added that prosecutors in Verona ordered the search in Bologna, which was conducted at the same time as a search of the Italian headquarters of Volkswagen.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Fitch cuts Brazil rating, says investment grade at risk

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Fitch Ratings on Thursday cut Brazil’s credit rating to the brink of junk, warning the country could soon lose its coveted investment grade rating as government finances deteriorate amid a prolonged recession and persistent political uncertainty.

Fitch cut Brazil’s rating to BBB-minus from BBB. It left a negative outlook on the new rating, suggesting another downgrade is possible over the next year or so.

A further downgrade by Fitch would mean two major ratings agencies placing Brazilian debt in junk territory.

“The negative outlook reflects Fitch’s view that economic and fiscal underperformance is likely to persist while political uncertainty could continue weighing on broader confidence,” Fitch said in a statement.

The uncertainty, Fitch added, would “delay a turnaround in investment and growth.”

The Brazilian real erased early gains and dropped about 1 percent following the downgrade, which potentially increases debt costs for the country and Brazilian companies.

Fitch’s decision comes little more than a month after Standard & Poor’s stripped Brazil of its investment-grade rating, saying mounting political problems have muddled economic policy in Brazil.

A second downgrade to junk could have an even greater market impact than the first one as many investors are prevented from holding bonds that are not rated investment grade by at least two ratings firms.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

HSBC workers face pay cut as bank slashes costs

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Watchdog orders VW to recall 2.4 mn vehicles: Report

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Germany’s automotive watchdog, the Federal Motor Transport Authority, has ordered Volkswagen to recall 2.4 million vehicles, Reuters news agency reported Thursday.

The watchdog rejected the voluntary recall of vehicles put forward by Volkswagen in a plan submitted this month, according to German newspaper Bild which first reported the news.

Billions of euros have been wiped off Volkswagen’s value following the revelation that the company had used software to change its diesel engines’ performance under US test conditions.

The company last week withdrew applications for approval to sell 2016 diesel car car models in the US, the Associated Press reported, after it admitted the cars contain emissions software “that would potentially help their exhaust systems run cleaner during government tests.”

Also on Thursday, Italian police are reported to be searching the headquarters of sports car maker Lamborghini, according to Reuters which has cited an investigative source.

This is part of the criminal investigation into alleged commercial fraud by parent company Volkswagen, the news agency.

It added that prosecutors in Verona ordered the search in Bologna, which was conducted at the same time as a search of the Italian headquarters of Volkswagen. 

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Sugar high? This commodity could stage a sweet comeback

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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After four consecutive years of annual price declines, 2015 could see sugar stage a sweet comeback.

A slew of supply disruptions have propelled ICE raw sugar prices 36 percent higher to about 14 US cents a pound on Wednesday, up from a seven-year low of 10.44 cents in August, and analysts believe the gains are likely to continue amid sliding output from the world`s top producers.

“In India, an early withdrawal of the monsoon and higher ethanol output in Brazil could be disruptive enough to drive the market into a severe deficit, as seen in 2009, when the sugar price rallied 90 percent in just four months,” Barclays pointed out in a recent report.

The past few years have been anything but a sugar high for the commodity. Prices have plunged 25 percent over the past two years as countries churned out record production, but fortunes now appear to be changing.

Read More: Sugar far from sweet spot for investors

A milder-than-expected monsoon in India, the world`s second-biggest producer, could see its sugar output decline 5 percent this year, as Maharashtra and Uttar Pradesh, key sugar-producing regions, experience rains 20-50 percent below normal. Even though India boasts high inventory levels, Barclays believes a severe drought brought on by the El Nino weather phenomenon could force the country to convert from a sugar exporter to an importer this year.

“Recall that, a drought back in 2009 in India led sugar prices to a 30-year high,” according to the bank`s note.

Meanwhile, Brazil-the world`s largest producer-is ramping up production of ethanol, of which sugarcane is a key ingredient.

Ethanol production increased an annual 4 percent to 28.6 billion liters in 2014 and is expected to hit 44 billion liters by 2024, according to state-run research firm Empresa de Pesquisa Energetica (EPE).

Brazilians are consuming more of the alternative fuel because it`s cheaper than gasoline. The real`s (Exchange: BRLUSD=) 44 percent depreciation against the greenback has made crude oil imports more expensive, forcing state-run oil behemoth Petrobras to raise gas prices by 6 percent two weeks ago. Despite being one of South America`s top oil producers, the country still needs to import vehicle fuels to meet domestic demand.

In China, the world`s fourth largest sugar producer, low profitability is hurting output, Barclays noted.

“Sugarcane farming has turned into a money-losing business since 2014 on rising labor cost and declining average selling prices, leading to farmers rotating to other crops [like eucalyptus, bananas, and vegetables].”

Typhoon Mujigae also leveled plantations in the southern Chinese region of Guangxi, responsible for 63 percent of national production, when it made landfall in early October. With harvesting starting in November, it`s too late to replant, Barclays warned.

Read More: Hot chocolate! Behind the big cocoa rally

“Previously, any bullish news about sugar was always taken with a grain of salt since the supply backdrop remained in excess but now there is a real supply disruption, so the price rally should be sustainable,” noted Avtar Sandhu, senior commodities manager at Phillip Futures.

He cautions that there`s still a chance for the market to end the year with a surplus. But the situation could be revisited in 2016.

“Harvesting season has already arrived for major producers like Brazil and India so these disruptions may not matter much for this year`s crop. Next year should definitely see the market in deficit.”

Copyright 2011 cnbc.com

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Asian stocks advance; Kospi widens gains after BOK decision

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Asian stocks moved higher early Thursday, shrugging off a tepid open brought about by an unimpressive lead from offshore markets.

Wall Street finished in the red overnight, as investors digested mixed results from the banking sector as well as the release of lower-than-expected sales forecasts for fiscal 2016 by Wal-Mart.

The Dow Jones Industrial Average dropped nearly 1 percent, ending below the psychologically key level of 17,000 for the first time since October 7, on the back of declines in Wal-Mart and Boeing. The S&P 500 and Nasdaq Composite ended 0.5 and 0.3 percent lower respectively.

Mainland markets up

China’s share markets opened up on Thursday, with the Shanghai Composite edging up 0.4 percent.

The benchmark CSI300 Index elevated 0.6 percent, while the smaller Shenzhen Composite ticked down 0.5 percent.

Nikkei bounces 0.6 percent

Japan’s Nikkei 225 index changed course in early trade to reclaim 18,000 points, after finishing under the level for the first time since October 2 in the previous session.

A tick down in dollar-yen probably encouraged risk appetite for exporters. Blue chips such as Toyota Motor and Sony pared earlier declines to rise 0.8 and 0.5 percent respectively, while Panasonic halved losses to 1.5 percent.

Counters which came under pressure due to their heavy exposure to China, also recovered their footing. Komatsu eked out marginal gains, while Fast Retailing, owner of clothing brand Uniqlo, bounced up 0.9 percent.

Defying the rebound, shares of Asahi Kasei tanked nearly 10 percent on the back of news that its subsidiary performed faulty installation of a portion of foundation piles in work for a Yokohama apartment complex, Reuters reported.

ASX gains 0.3 percent

Australia’s S&P ASX 200 index nudged up, on course to snap a three-session losing streak, as the key resources sector enjoyed some reprieve following a sharp sell-off in previous sessions.

BHP Billiton and Rio Tinto rallied more than 1 percent each, while Fortescue Metals elevated nearly 6 percent on the back of news that the miner’s production costs were beating its fiscal 2016 target.

Evolution Mining rocketed 10 percent, while Newcrest Mining and Kingsgate Consolidated soared 4.1 and 5.4 percent respectively, as gold prices hit a three-and-a-half-month peak after soft U.S. data and concerns over deflationary pressures in China fueled expectations that the Federal Reserve will hold off raising interest rates.

Energy producers also turned higher, with battered shares of Oil Search and Santos up 4.3 and 2.3 percent respectively.

A string of corporate news released before the market open were also eyed. Insurance Australia Group (IAG) soared 5 percent on the back of news that it plans to pause further investments in China. A statement released by the insurer on Thursday said that IAG will be pursuing “further growth opportunities in other Asian markets and our core businesses in Australia and New Zealand.”

Australia and New Zealand Banking Group (ANZ), which said it will be selling its New Zealand medical insurance business to NIB NZ, dropped 0.9 percent.

Kospi rises 1.1 percent

South Korea’s Kospi index headed further north in early trade, after the Bank of Korea (BOK) kept interest rates steady for a fourth straight month, in line with expectations.

The bourse’s top two weighted stocks Samsung Electronics and Hyundai Motor climbed 1.4 and 0.3 percent respectively, while utility Kepco advanced 0.9 percent.

Lotte Group shares were in focus following new developments in a family feud that has shrouded the country’s number 5 conglomerate in recent months. On Wednesday, chairman Shin Dong Bin lost his directorship at Japan-based Kojunsha Corp, the group’s virtual holding firm, in the latest move taken by his older brother Shin Dong-joo amid a power struggle over control of the group.

Lotte Shopping and Lotte Chemical rose 1.2 and 3.1 percent respectively, but Lotte HiMart eased 1.5 percent. Lotte Confectionery traded flat.

Meanwhile, Bank Indonesia (BI) is also projected to stand pat on Thursday, maintaining its policy rate at 7.5 percent.

“The currency remains under pressure after a strong selloff on fears of U.S. monetary policy normalization,” a note by Moody’s Analytics released last Friday said.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Who won the first Democratic debate?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The first Democratic debate of the election season saw fewer fireworks than the two Republican showdowns, but it still featured some tense moments of disagreement.

Many commentators were quick to call former Secretary of State Hillary Clinton the winner, but Sen. Bernie Sanders hit the main points that will likely keep his base intact.

Below is a first-impression list of the debate’s winners and losers.

Debate Winners

Obama’s Legacy

There were few substantive disagreements with the policies or actions of President Barack Obama during the debate. Former Maryland Governor Martin O’Malley said at the beginning of the night that, thanks to the president, “our country has come a long way.”

Clinton also celebrated Obama, implying his decision to make her secretary of state was proof alone of her foreign policy judgment. Twice, she mentioned her actions alongside the president in meeting with the Chinese on climate change issues.

Even a question that asked the debaters how they would be different than Obama elicited few criticisms. Sanders said he had a lot of respect for the president, former Sen. Jim Webb said he would rely less on executive orders, and Clinton simply called attention to her gender difference.

Bernie Sanders’ policy

The Vermont senator hit all of his main policy points during the night’s debate, but other candidates were quick to highlight their agreement with the self-professed democratic socialist.

O’Malley and Clinton found themselves starting statements by acknowledging similarities with Sanders, but his effect could even be seen in answers that didn’t include a name-check. Attacks on Wall Street, foreign policy points and critiques of the campaign finance system all mirrored key Sanders opinions.

The biggest disagreements with the senator came on his gun control stance: Several of the candidates actually moved to the left of him on the issue.

Clinton’s preparation

The Clinton camp may feel the highlight of the night came when Sanders declared “Enough of the damn emails, let’s talk about the real issues facing America,” but the leading candidate also had strong moments of her own.

Pundits were quick to praise Clinton’s preparation as the debate wrapped up, citing her deft handling of a slew of criticisms. Not only did the former first lady have answers ready on her emails and her record on Iraq, but she also had clear and concise answers on trade and entitlements.

Some have already said that Clinton got off easy on the topic of Wall Street, but she did mount a defense of her positions — even boasting that her plan is tougher than some of her Democratic competitors’.

O’Malley’s bid for vice president

In part because of the order that moderators asked questions, O’Malley spent much of Tuesday night agreeing with others on the stage. Still, some commentators said he was already angling for a top position with another Democratic candidate.

The former Maryland governor had some strong moments, but never firmly articulated why he was a much stronger nominee than his competitors. In fact, one of his best-received answers of the night came when he issued an argument for the Democratic Party as a whole. The crowd cheered when O’Malley said the debate featured “an honest search for the answers that will move our country forward” — as opposed to what he said the Republican debates looked like.

Debate Losers

Lincoln Chafee

Lincoln Chafee — the former mayor, senator, and Rhode Island governor — drew significant flak online and in television punditry for his comment explaining why he voted to repeal Glass-Steagall in 1999.

“The Glass-Steagall was my very first vote, I just arrived, my dad had died in office, I was appointed to office, it was my very first vote,” Chafee said. “I just arrived at Senate. I think we get some takeovers and that was one of my very first votes … it was 90 to 5.”

Donald Trump

There were relatively few references to Republican front-runner Donald Trump during the debate — especially compared with how often the GOP debates featured attacks on Clinton.

And while the real estate mogul was live-tweeting the event, the only real attack on his candidacy came from O’Malley, who called him “that carnival barker in the Republican Party.”

The Democrats seemed to be signaling that they were not taking Trump seriously (a view shared by some conservative talking heads).

Wall Street

To absolutely no one’s surprise, Wall Street proved a significant punching bag. The candidates all fought to claim they would be the toughest on the American financial sector. In fact, Sanders happily named Wall Street as one of the groups at the top of his list “of people who don’t like me.”

The closest thing to a defense of the system came from Clinton’s comment that it would be a mistake for the country to entirely turn its back on the capitalist system.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow