*PIMCO HIRES SCHRODERS'S VIRGINIE MAISONNEUVE TO HEAD EQUITIES
Peugeot in talks with Dongfeng about potential partnership, not capital increase
Listed French car maker PSA Peugeot-Citroen is not holding discussions about a potential capital increase with Chinese competitor Dongfeng, CNBC reported. The report cited Chief Executive Maxime Picat as saying that Peugeot is indeed in talks with Dongfeng, but rather about a potential partnership and the creation of future industrial and commercial developments.
Picat added that PSA had no short-term issues regarding its financial situation as the group can boast around EUR 11bn of financial guarantees.
Source CNBC
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BN 10/30 14:38 *SANOFI CALL ENDS BFW 10/30 14:37 *SANOFI CEO SAYS REPURCHASING L’OREAL STAKE DEPENDS ON NESTLE BN 10/30 14:35 *SANOFI SAYS 'COULD WELL BE OTHER OPTIONS' FOR L'OREAL STAKE BN 10/30 14:34 *SANOFI CEO SAYS REPURCHASING L'OREAL STAKE DEPENDS ON NESTLE BFW 10/30 14:28 *SANOFI CEO SAYS SLOWDOWN IN CHINA PHARMA MARKET IS TEMPORARY BN 10/30 14:27 *SANOFI CEO SAYS CO. WILL CONTINUE TO INVEST AND EXPAND IN CHINA BN 10/30 14:26 *SANOFI CEO SAYS SLOWDOWN IN CHINA PHARMA MARKET IS TEMPORARY BN 10/30 14:25 *SANOFI CEO DOESN'T SEE STRUCTURAL CHANGES IN EMERGING MARKETS BN 10/30 14:24 *SANOFI SEES 'LITTLE BITS OF PRICING PRESSURE' ON RARE DISEASES BN 10/30 14:22 *SANOFI CEO SAYS HE SEES AMGEN AS MAIN COMPETITOR ON PCSK9 BN 10/30 14:19 *SANOFI CEO SAYS HE DOESN'T AGREE WITH PFIZER COMMENTS ON PCSK9 BN 10/30 14:17 *SANOFI CEO SAYS 'NOTHING HAS CHANGED' ON MID-TERM GUIDANCE BN 10/30 14:16 *SANOFI CFO CONTAMINE COMMENTS ON COGS-TO-SALES RATIO BN 10/30 14:16 *SANOFI SEES IMPROVEMENT IN COST OF GOODS TO SALES RATIO NEXT YR BN 10/30 14:13 *SANOFI ANIMAL HEALTH PROFITABILITY WILL BE LOWER THAN BEFORE BN 10/30 14:11 *SANOFI CEO SAYS NEXGARD WON'T BE THE SAME SIZE AS FRONTLINE BN 10/30 14:10 *SANOFI CEO SEES FULL SUPPLY OF VACCINES RETURNING IN 1Q 2014 BN 10/30 14:09 *SANOFI CEO SEES 'PROGRESSIVE' RETURN OF VACCINE SUPPLY IN 4Q BN 10/30 13:50 *SANOFI CEO 'CONFIDENT THINGS WILL GET BACK TO NORMAL' IN CHINA BN 10/30 13:44 *SANOFI CEO SAYS TECHNICAL ISSUE WITH VACCINES HAS BEEN RESOLVED BN 10/30 13:42 *SANOFI SEES W. EUROPE SALES SLIGHTLY LOWER OR FLAT IN NEXT YRS BN 10/30 13:40 *SANOFI CEO VIEHBACHER COMMENTS ON CONFERENCE CALL BN 10/30 13:40 *SANOFI EXPECTS ANIMAL HEALTH SALES TO BE DOWN 5% FOR REST OF YR
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*SANOFI WOULD LOOK AT BUYING STAKE FROM L'OREAL IF AVAILABLE 2013-10-30 14:34:35.223 GMT
--SIMEON BENNETT
-0- Oct/30/2013 14:34 GMT
Don’t look now, but another Asian crisis may be brewing–courtesy of the U.S. Federal Reserve.
A paper recently published by the Bank of International Settlements–a multilateral club of monetary authorities that includes the Fed–noted that central bank bond-buying, or “quantitative easing,” has made dollar-based loans so cheap that Asian companies are ramping up their borrowing in greenbacks. The paper’s authors fear that once the Fed and the Bank of Japan eventually turn off their liquidity taps, rising dollar interest rates will leave these Asian debtors unable to pay back the money. That should trigger uncomfortable memories of the debt and currency “death spiral” of 1997-98, when plunging local currencies fueled a crisis in Asia that spread financial contagion around the world. The BIS study focuses on South Korea, Hong Kong and China. But it is China, the world’s second-largest economy, that deserves the most attention. Despite the constraints imposed by capital controls, foreign-currency loans in China grew by a whopping 35% in the 12 months to March 2013, according to the researchers, Robert N. McCauley of the BIS and Dong He of the Hong Kong Monetary Authority. That’s more than twice the 15% growth in loans denominated in Chinese yuan–a pretty alarming statistic given how worried everyone has become about those yuan-denominated loans to construction-obsessed Chinese municipalities. Much–but not all–of the foreign borrowing in China is funded by local banks with onshore foreign-currency deposits. It’s also likely that Chinese companies are using a large chunk of it to finance operations in offshore subsidiaries. That would mean much of the borrowing is never converted into yuan and therefore wouldn’t trigger Beijing’s capital controls. On the surface, this seems like a more stable situation than was the case in Thailand and Indonesia before 1997, when dollars were borrowed to finance local-currency expenditures, creating a mismatch that became unmanageable when the home currencies plummeted. Yet Messrs. Dong and McCauley still worry about “substantial financial stability risks–not so much currency mismatch risks, but rather maturity and liquidity risks associated with dollar funding” in Asian economies. And for this they cite the dollar shortages of 2008 and 2009, when a failure to renew short-term loans led to paralysis in global trade. But it is the parallels with the Asia crisis and the lessons that experience offers for our understanding of the current phase of the global economic cycle that send the biggest warning signal. The authors note that the Fed is already facing a “difficult exit from very accommodative policy over the next several years,” much as it was also going through tightening process in 1997 until the Asian crisis disrupted it with the turmoil that was unleashed in world markets. They suggest that “financial instability in East Asia” could produce even worse “blow-back effects” to large economies this time because the region “has stronger trade links to North America and Europe today than it had 15 years ago. No one can say precisely how such contagion would play out. But for the sake of argument, we could imagine the Hong Kong subsidiaries of major European banks suffering heavy losses, for example, as one mainland Chinese debtor after another misses payments on foreign debts. And from there, it’s just one step before the euro crisis roars back to life as investors start worrying about the undercapitalized banks of the common currency region and their holdings of shaky governments’ bonds. The foreign exposures to this Asian debt buildup aren’t trivial. In China alone, foreign lending now stands at about $880 billion. While that’s still only 8.5% of total Chinese debt, it’s way up from 5.3% in 2009, according to the researchers. What’s more, dollar debt has a magnified capacity to trigger a credit crisis because foreign lenders can ignore government directives to roll over bad debtors’ loans–unlike the state-run banks. This is why defaults on foreign loans have often been the catalyst for Chinese credit episodes in the past, notes David Hoffman, managing director of The Conference Board’s China Center for Economics and Business. Some of the dollar-borrowing represents a long-term bet on the appreciation in the yuan. But the BIS paper shows that the biggest driver is the Fed’s massive quantitative-easing program, which pumps $85 billion into the global economy each month and which is creating easy credit conditions in foreign countries whose economic conditions don’t warrant them. We’ve already seen the extreme volatility that the mere hint of a reduction in Fed bond-buying created in emerging markets over the summer–the Indian rupee, for instance, dropped 20% versus the dollar between the beginning of May and the end of August–as all the “hot money” spurred by previous rounds of QE high-tailed out of those countries’ bond and money markets. Just imagine the damage when the Fed actually does something. The Federal Open Market Committee is highly unlikely to acknowledge such concerns when it releases a post-meeting statement this afternoon, one that will almost certainly retain the $85 billion-per-month operation. But for the sake of global stability, let’s hope it is at least taking them into account for policy planning–that is, if it’s not already too late.
Walter Energy on earnings conf call Co notes that the World Steel Association (WSA) still holds that global steel demand will be up +3.1% this year, up slightly of its earlier forecast of 2.9%. For 2014, the WSA sees 3.3% steel consumption growth, driven by China and India WLT still thinks the market is still oversupplied Production cust have helped offset some of this Co thinks the recently move in met coal prices is sustainable
SPD Party member indicates a consensus has been reached with Merkel's CSU/CDU party on a coalition
Coty And Prada SA Announce Fragrance Partnership
Marine Harvest plans to acquire Pescanova's subsidiaries
Marine Harvest is planning to acquire Pescanova's subsidiaries Acuinova Chile and Nova Austral, El Faro de Vigo reported.
The Spanish-language article, citing Alf-Helge Aarskog and Ivan Vindheim, CEO and CFO of the Norwegian Marine Harvest respectively, said the two subsidiaries produce salmon and trout.
Faro de Vigo
Moody's: Lowers FY13 op income outlook for the US retail industry to +3.5-4.5% (prior 4-5%) - Change mostly reflecting weak earnings at J.C. Penney, Sears and Radio Shack - Historically retail sales growth is strongly correlated to GDP, and generally outperforms GDP growth because of inflation, Taylor says. But given the current low level of inflation, this year and next the outperformance gap will be due mainly to reduced government spending, which is constraining GDP growth. Moody's forecasts US GDP growth to be 1.5% to 2.5% in 2013, and 2% to 3% in 2014. - Over the past two holiday seasons, Americans have largely ignored negative headlines around fiscal policy and gone ahead with their gift shopping, and Moody's believes they will do the same this year. The rating agency forecasts fourth-quarter sales growth of 4.5% to 5.5%, compared with 4.2% in the fourth quarter of last year
Former US vice-president Al Gore has today announced a white paper he funded, highlighting the risks to investors of owning carbon-intensive assets. Mr Gore, who served under Bill Clinton, has stressed the need for investors to consider the carbon risks inherent in their investment portfolios, suggesting that investors “divest from carbon-intensive fossil fuel assets”.
The 65-year-old said: “Although the scientific community overwhelmingly agrees that climate change is happening, investors have so far been slow to appreciate the implications for the carbon-intensive assets within their portfolios.” Mr Gore, who is now chairman of Generation Investment Management, fears carbon assets will become “stranded”, a term used to describe assets that lose economic value well ahead of their anticipated useful life – whether as a result of changes in legislation, regulation, market forces, disruptive innovation, societal norms or environmental shocks. Assets at risk of being stranded range from gold mines in South Africa and coal-fired power stations in China and India, to grand cru vineyards in France and ski resorts in the US. Regulation, for example, will lead to the closure of Germany’s nuclear power stations, which were due to produce power until 2036. Following the Fukushima disaster in Japan and a wave of public opposition to nuclear power, Chancellor Angela Merkel announced that the country’s nuclear plants would be mothballed by 2022. Mr Gore, who won an Oscar for An Inconvenient Truth, his documentary about the perils of global warming, said: “The global economy must continue to rapidly evolve to reflect the realities of climate change. Investors must now acknowledge that corresponding changes are needed on their part as well.” According to the World Resources Institute, 1,199 new coal-fired power plants are being proposed around the world, yet the coal industry is one of the most exposed to becoming stranded. David Blood, a senior partner at Generation Investment Management, which backed the white paper financially, added: “From the perspective of risk management, it is no longer prudent for investors and asset owners to treat climate change as a peripheral issue.”