$500MN DEALS | Page 4 Q1 RESULTS | Page 11

IAG to sell GE profit tops

SE Asian estimates on
businesses cost-cutting

Saturday, April 21, 2018

Sha’baan 5, 1439 AH
TRUMP GOVT’S LARGEST PENALTY: Page 12

GULF TIMES US fines Wells Fargo

$1bn for mortgage,
auto loan violations

BUSINESS
Oil erases losses as
‘Roadshow showcases impact of Trump
tweet on price fizzles

commitment of Qatar, Bloomberg

New York

Oil erased losses in New York

after the initial reaction to US
President Donald Trump’s tweet
meaning it may surpass top
producers Saudi Arabia and
Russia.
WTI for May delivery erased
losses to trade 3¢ higher at
$68.32 a barrel as of 12:25pm in
New York. That contract expires

US to trade relations’
By Peter Alagos technology, media, entertain-
Business Reporter ment, and real estate, among
others. The total worth of con-
firmed exports and orders to Qa-
aircraft and spare parts, ma-
chinery and furnaces, auto-
mobiles (excluding trams and
rails), electronic and electrical
on “artificially Very High” prices
fizzled.
The comments came as the
Organisation of Petroleum
Exporting Countries (Opec) and
allies including Russia showed
willingness to further tighten
oil markets and boost prices
in a meeting in Saudi Arabia.
West Texas Intermediate futures
dropped as much as 1.2% before
on Friday. WTI has risen 10% in
two weeks.
Brent crude for June delivery
fell about 69¢ at the time of
the tweet, before trading just
4¢ lower at $73.74 a barrel in
London. Both benchmarks are
set for weekly gains.
President Trump’s comments
come in the same week that
US oil inventories fell below

T
he series of high-level
meetings being held dur-
ing Qatar’s economic
roadshow across a number of
US cities is a clear display of
commitment to enhance co-
operation and trade relations
between the two countries,
an official of the Washington-
based US Qatar Business Coun-
cil said.
The meetings between US and
Qatari officials show the depth
and strength of the bilateral re-
lationship, according to US Qa-
tar Business Council associate
director, Business Engagements,
Max McGee.
“They show the private sector
that there is a strong commit-
ment between our two coun-
tries, meaning an investment in
the counterpart is safe and lu-
crative. It encourages true bilat-
eral business and investment,”
McGee told Gulf Times.
On the value of Qatari invest-
ments in the US, McGee said
the Qatar Investment Author-
ity (QIA) has pledged to invest
a total of $35bn into the US by
2020. In 2017, the QIA commit-
ted to investing another $10bn,
specifically in infrastructure, he
McGee: True bilateral business.
continued. “So far, over $21bn
of that allotment has been in-
vested. This doesn’t include
private investments like Al
Rayyan Tourism Corporation’s
investments in hotels through-
out the country, or Qatar Air-
ways purchasing over $92bn in
American-made aircraft,” Mc-
Gee said.
Citing data provided by the
Ministry of Economy and Com-
merce, McGee said Qatar’s in-
vestments are diversified in
tar is $146bn, which generated
1mn American jobs that depend
on doing business with Qatar,
the data said.
The MEC data said there are
15,000 American citizens liv-
ing in Qatar, 5,000 of which are
working in high-skilled jobs in
the country; $29bn worth of
Qatar’s major projects that US
companies will compete for will
generate up to 100,000 new
American jobs. Also, the 2022-
FIFA World Cup will create up
to $10bn in investment for US
companies.
On trade exchange, the MEC
said the US is one of the major
trade partners of the State of
Qatar with a surplus of $4bn in
favour of the US; the US is the
largest exporter to Qatar with
total US exports amounting to
$4.88bn in 2017.
Qatari exports to the US in
2017 stood at $1bn to include
petrochemical products and
derivatives, aluminium and its
products, fertiliser, salt, Sul-
phur, earth, stone, plaster, lime,
cement, and organic chemicals.
Conversely, the value of Qa-
tari imports from the US stood
at $4.88bn in 2017 to include
equipment, medical and opti-
cal equipment, pearls, precious
stones and metals, as well as
aluminium and its derivatives,
mineral fuels, oils and distil-
lates, iron or steel products,
prefabricated buildings, furni-
ture, lighting fixtures and signs,
plastics and related products
and various chemical products,
and meat.
Asked about the council’s
role in helping increase trade
volume between the two coun-
tries, McGee said: “For Qataris,
the US market is massive. Thus,
the council can help identify
the right partners, investors, or
buyers in the US and establish
strong and valuable partner-
ships for Qatari companies.
“For Americans, the busi-
ness climate in Qatar can be a
bit different than they are used
to. The Business Council can
help these companies identify
the right partners and avenues
for trade and investment in Qa-
tar and ease that process. We are
here to support both the sides in
increasing trade volume. We can
also identify sectors of growth
and areas in the market that
need new products or services.”
the losses were erased. their five-year average for the
“Looks like Opec is at it again,” first time since 2014 as Opec
Trump said on Twitter. “With policy of curtailing production
record amounts of oil all over appears to be close to achieving
the place, including
the fully loaded ships
at sea, oil prices are
artificially Very High!
No good and will not
be accepted!”
Oil ministers from
Saudi Arabia, Russia
and the United Arab
Emirates pushed back
on the charge, saying
there’s no such thing Opec secretary-general Mohammad
as artificial prices, that Barkindo says the US oil and gas
current market levels industry is benefiting from Opec’s efforts
reflect geopolitics and to stabilise the market.
that demand is strong.
Crude has rallied in recent its stated goal. Brent moved to
weeks as output cuts from Opec almost $75 a barrel on Thursday,
and its allies were compounded its highest level in more than
by heightened geopolitical risks, three years.
including the possibility of re- Opec’s not the only reason why
newed US sanctions on Iran. US oil prices have moved higher.
shale producers are also facing Fears that Trump will re-impose
production challenges. sanctions on Iran when the
“Those goals Opec set out are nuclear deal is reviewed are
nearly achieved,” said Katie adding to uncertainty and
Bays at Height Securities LLC. could halt as much as 800,000
“I don’t see how the president’s barrels a day of exports from
position necessarily will weigh Opec’s third-largest producer
in on that at all.” within six months. Venezuela’s
Meeting in Jeddah, a committee economic meltdown and plung-
of Opec and other oil producers ing production has also hit
found high levels of compliance supplies.

Trade dispute could put many jobs at risk: WTO chief
AFP that we have seen in recent years,
Washington threatening the ongoing economic
expansion and putting many jobs at risk.”
The spat between Washington and
A major escalation in the trade dispute Beijing has cast a shadow over the IMF
between the US and China could derail gathering and the fund cites the dispute
the global recovery and put “many jobs as the biggest risk to the otherwise solid
at risk,” World Trade Organisation chief global growth outlook.
Roberto Azevedo said yesterday. US President Donald Trump last month
And most of the impact of an all-out trade imposed steep tariffs on steel and
war would hit poor countries the hardest, aluminium imports and threatened to
he said in a statement to the International impose more on tens of billions of dollars
Monetary Fund’s spring meetings. in Chinese imports, prompting Beijing
It is difficult to measure the effects “of a to slap duties on US goods like pork and
major escalation, but clearly they could sorghum and to threaten even more
be serious,” he said. sensitive US exports like soybeans.
“A breakdown in trade relations among Azevedo expressed concern over “the
major players could derail the recovery possibility that we enter a sequence
of unilateral, tit-for-tat measures, all of
which generate uncertainties for global
trade and GDP growth,” since the damage
would reach “far beyond those countries
who are directly involved.” He urged
countries to use the WTO as a forum for
resolving any disputes, which “will be
essential to prevent current tensions
from escalating.”
“The WTO, which was created as a forum
for members to hold each other to
account, will play its proper role in this
process.”
In fact China has gone to the WTO to
complain about US steel tariffs, which
were imposed on national security
grounds.
And although Trump has disparaged the
organisation saying it does not treat the
United States fairly, Washington has filed
several WTO dispute cases including one
against China for theft of US intellectual
property.
The WTO chief’s comments reflected
the growing concern among global
officials to keep the disagreement from
spreading.
IMF chief Christine Lagarde said
Thursday the uncertainty generated by
the dispute undermines confidence and
could choke off investment and hamper
trade, which have been two key drivers of
global growth.
The WTO projects global merchandise
trade will expand by 4.4% this year, after
increasing by 4.7% in 2017.
with the production curbs. Still,
there’s capacity for prices to rise
beyond this week’s three-year
high, according to Saudi Energy
Minister Khalid al-Falih, who
said co-operation between
producers would continue into
2019.
Russian Energy Minister Alexan-
der Novak said the output deal
has stimulated US oil production
and helped “restore the industry
of Texas.” Opec secretary-
general Mohammad Barkindo
said the US oil and gas industry
is benefiting from the group’s
efforts to stabilise the market.
US crude production was at
10.5mn barrels a day last week,
up from 9.3mn barrels a day a
year ago, according to govern-
ment data, with growth rates
US shale, the big growth driver
of the last three years, is also
facing some “production chal-
lenges,” Paal Kibsgaard, chief
executive officer of Schlum-
berger Ltd, the world’s biggest
provider of oilfield services, said
yesterday. Shortages of pipe-
lines, labour, equipment and
sand is threatening to curtail
growth.
Twitter has emerged as a
preferred medium of commu-
nication for Trump, allowing
him to directly reach his 51mn
followers and countless more
through news coverage.
On April 2, Amazon.com Inc
shares dropped after Trump
said the company’s deliveries
cost the postal service and drive
retailers out of business.

US weighs emergency powers to curb China tech investments

Bloomberg “unusual and extraordinary threat,” al- day. “The US is thinking and acting like investments in the US since Trump who described the matter on the condi- ways to impose tougher conditions on
Washington lowing him to block transactions and a bully — only it can have high tech and took office, hurting the ability of Amer- tion of anonymity last month. Chinese firms using legislation that
seize assets. others cannot. With regard to the high ican companies to raise capital and China state-supported companies underlies the Committee on Foreign
Trump is pushing his administra- tech restrictions, they are citing the holding down valuations. such as Tsinghua Unigroup Co have Investment in the US, which reviews

T
he Treasury Department is
considering using an emer-
gency law to curb Chinese in-
vestments in sensitive technologies,
as the Trump administration looks
to punish China for what it sees as
violations of American intellectual-
property rights.
The US government is reviewing the
possible use of a law known as the In-
ternational Emergency Economic Pow-
ers Act, said Heath Tarbert, an assistant
secretary in the agency’s international
affairs office. Under the 1977 IEEPA law,
President Donald Trump could declare
a national emergency in response to an
tion to crack down on what he consid-
ers unfair trade practices by China. He
has threatened tariffs on as much as
$150bn in Chinese imports in response
to intellectual property theft and forced
technology transfer. Beijing has retali-
ated by proposing tariffs on $50bn of
American goods, and pledging further
action if necessary.
The president asked Treasury Sec-
retary Steven Mnuchin to consider in-
vestment restrictions on Chinese firms
after the administration released the
results of its probe into China’s IP prac-
tices last month.
Beijing fired back forcefully on Fri-
reason of national security, but their
motivation is protectionism. Is the US
really that fragile?” foreign ministry
spokeswoman Hua Chunying said at a
daily briefing.
Mnuchin has until around May 21
to propose executive action to address
concerns about investments in the US
“directed or facilitated by China in in-
dustries or technologies deemed im-
portant,” according to the March 22
presidential memo.
While investors have so far focused
on Trump’s plan to impose tariffs on
Chinese imports, new restrictions
could deepen a slowdown in Chinese
US Said to Weigh Emergency Law for
China Investment Crackdown
Acquisitions by Chinese firms in the
US fell to $31.8bn last year from $53bn
the year before, according to data com-
piled by Bloomberg. The directive from
Trump to consider investment restric-
tions deals only with China, Tarbert
said.
Treasury officials are working on
plans to identify technology sectors
in which Chinese companies would be
banned from investing, such as semi-
conductors and so-called 5G wireless
communications, according to four
people with knowledge of the proposal,
already had to back off plans to buy or
invest in American technology com-
panies. Yet private sector companies,
led by Tencent Holdings Ltd, Alibaba
Group Holding Ltd and Baidu Inc have
been active in the US.
Tencent has invested in more than
50 companies in the country in the
last five years, according to data com-
piled by Bloomberg. Those include
artificial intelligence startups like
ObEN Inc, biotech companies such
as Locus Biosciences Inc and satellite
equipment developer Satellogic USA
Inc.
Treasury officials are also looking at
transactions for national-security con-
cerns.
Tarbert, who spoke Thursday at an
event in Washington, said Treasury is
also supporting a bipartisan bill that
would expand the authority of the
inter-agency panel, known as CFIUS,
which currently vets foreign takeovers
on a case-by-case basis.
“That’s a separate process that’s
ongoing, but the CFIUS office is not
working on that. We have separate of-
fices in Treasury which are consider-
ing those two issues distinctly,” Tar-
bert said, referring to both IEEPA and
CFIUS.
 Gulf Times
2 Saturday, April 21, 2018

BUSINESS
Asian oil demand to hit
China banks extend $302bn record, but industry can’t
take eyes off Middle East

in new property loans in Q1 Reuters

Singapore

Asian oil demand will hit a

Reuters The total rose 58% from 1.2tn yuan
Beijing ($190.82bn) in the fourth quarter of 2017,
according to Reuters calculations.
The property sector is a key growth
secutive month in March, with more cit-
ies reporting growth as the government
supported demand from first-time buy-
ers.
Individual mortgage loans increased by
99.49mn yuan in the first quarter.
Chinese banks doled out more loans
overall in March and appeared to make
record in April just as global
crude values are lifted to
levels not seen in three years
by Middle East supply risks
economic performance has
also been stronger than
expected.
“Chinese growth of 6.8% in Q1
is higher than its target of 6.5%
for the year.
The supportive growth
environment in China is one
key reason for a supported

C
hinese banks extended 1.9tn yuan driver for the world’s second-largest In the first quarter of 2017, lending was solid progress in reining in off-balance and top exporter Saudi Arabia
($302bn) in new property loans in economy but authorities have struggled 1.7tn yuan and sales growth accelerated sheet lending that has prompted a withholding output and noisily
the first quarter of 2018, reflect- to keep soaring prices in check so that thanks to a boom in smaller cities where sweeping crackdown by regulators look- pushing for prices at $80 to
ing still solid demand for housing even housing is still affordable. home purchase conditions are less re- ing to reduce systemic financial risks. $100 per barrel.
as curbs on speculation continue to bite, China posted its fastest property in- strictive. Regulators have been cracking down Most analysts have pointed
central bank data showed yesterday. vestment growth in three years in the first Outstanding property loans rose on consumer loans that are being mis- to escalating Middle East
Property loans, comprised mainly of quarter, driven by a surge in land values 20.3% by end-March from a year earlier used for home purchases, warning they conflicts, a crisis in Venezuela,
individual mortgages and loans for real and as developers grew more confident to 34.1tn yuan, the PBoC said in a quar- cannot be used to “fuel property bub- and the supply cuts of Saudi
estate development, accounted for 38.8% about the policy outlook. terly report posted on its website. bles”. Arabia and other producers as
of all new loans made in the quarter, Reu- However, sales slowed as limits on Outstanding individual mortgage loans Consumer loans increased by 1.4tn the main drivers taking global
ters calculated from data from the Peo- home purchases hit transactions. rose 20% by end of March to 22.86tn yuan in the first quarter, according to benchmark Brent and US.
ple’s Bank of China (PBoC). New home prices rose for the 35th con- yuan. PBoC data. West Texas Intermediate
crude futures this week to
their highest since late 2014 at
almost $75 and $70 a barrel,
respectively.
Yet a much more fundamental
reason has also sparked oil’s
bull run: Asian demand, which
Goldman Sachs said this week
points to an average price of
$80 a barrel in 2018.
“Rising tensions in the Middle
East have likely played a
role in oil price strength, but
we believe a tight physical
market is the key driver,” US
investment bank Jefferies said
on Friday in a note to clients.
Trade data in Thomson Reuters
Eikon shows seaborne imports
of crude oil by Asia’s main
buyers will hit a record this
month, a big portion going to
slake China’s voracious thirst.
By end-April, China will likely
have taken in more than 9mn
barrels per day (bpd) of crude,
its most ever.
That’s nearly 10% of global
consumption and more than a
third of Asia’s overall demand.
At $75 a barrel, it implies
monthly import costs for China
of more than $20bn.
The record comes despite
maintenance season, which
usually dents imports at this
time of year, and indicates
that China’s oil requirement is
A cable is seen near residential buildings under construction in Beijing. China’s property loans, mainly individual mortgages and loans for real estate development, bigger than expected.
accounted for 38.8% of all new loans made in the first quarter, Reuters calculated from the People’s Bank of China data. “Chinese demand points to
strong growth,” said US bank
Goldman Sachs in a note to
clients, adding that it may
be “higher than currently
oil demand story in general,”
said Barnabas Gan, analyst at
Singapore’s OCBC Bank.
Suresh Sivanandam of energy
consultancy Wood Mackenzie
said he expected China’s
overall oil demand to grow
by 370,000 bpd this year to
12.78mn bpd.
Adding in other regions,
Goldman said global oil
demand in the first quarter
of 2018 is likely to post the
strongest year-on-year growth
since the last quarter of 2010.
A tighter market is also
showing up in rising costs for
crude deliveries to Asia as
Middle East producers raise
their official selling prices
(OSPs).
The OSPs for Abu Dhabi’s
Murban and Saudi Arabia’s
Light crudes are currently
showing their highest
premiums to Dubai since 2014.
With demand growing all
around, some analysts say
there is little reason to expect
anything but further price
increases.
Standard Chartered Bank said
this week there were “no bears
left in this oil town”.
So far, refineries in Asia are
still operating at high levels to
meet strong demand, despite
rising crude feedstock prices
eating into profit margins.
“Refiners are not likely to
reduce imports or trim down
run rates despite the price
increase,” said Lee Dal-seok,
senior research fellow at state-
run think tank Korea Energy
Economics Institute.
Still, some dark clouds loom.
China’s Sinopec, Asia’s largest
refiner, plans deep cuts to
its May crude imports as its
biggest refinery – the 460,000
bpd Zhenhai Refining and
Chemical Company – goes into
major overhaul.
Several traders said more such
outages are due in May and

China’s ZTE vows to fight US supplier ban

AFP particular grievance with Beijing’s “Made
Beijing in China 2025” policy to harbour national
champions in technology fields the US sees
as critical to its future.
ness, investment bank CICC estimated in
a research report cited by Beijing Business
Today.
ZTE has halted trading of its shares in
It will not only lose tens of thousands
of jobs but also affect tonnes of related US
companies,” Gao said. The options left at
the company’s disposal are unclear. When
estimated”.
Michal Meidan of consultancy
Energy Aspects said Chinese
buyers were re-stocking after
running down inventories late
last year.
Much of China’s new demand
also comes from the advent
of non-state refiners – often
June, likely reducing China’s
crude imports in coming
months.
The International Monetary
Fund (IMF) this week also
released its World Economic
Outlook in which it warned
that rising US-China trade
restrictions threatened global

C
hinese telecom giant ZTE vowed
yesterday to fight back against a US
order banning it from purchasing
and using US technology for seven years, a
move that has angered Beijing.
The decision announced by Washington
this week has clouded prospects for the
telecom and phone maker, which depends
on US technology such as chips and the
Android operating system for its mobile
phones. The tough sanctions come as the
battle over technology takes centre stage
in a US spat with China that has fanned
fears of a trade war. Washington has taken
In Beijing the action against ZTE will
likely heighten fears about the reliance on
US technology for critical industries.
The order “seriously endangers the sur-
vival of ZTE”, the company said in a state-
ment yesterday, adding “we cannot accept
it!” The firm said it would “not give up its
efforts to resolve the problems through
communication and dialogue, but would
also resolutely protect its legitimate rights
and interests through all legally permit-
ted methods”. The company has one or
two months of stored component supplies
before the ban will start to impact its busi-
Hong Kong and Shenzhen since Tuesday.
Washington’s control of the company’s
fate – with roughly 80,000 employees
mostly based in southern China – has
stirred ire and angst in China, where offi-
cials prize stability. “China will pay close
attention to the development of the situ-
ation and stands ready to take the neces-
sary measures to safeguard the legitimate
rights and interests of Chinese enterpris-
es,” commerce ministry spokesman Gao
Feng said Thursday. “The US’s actions are
ostensibly aimed at China, but they will
ultimately hurt the US itself.
introducing the export ban in Washing-
ton, a commerce department official told
reporters there was no “off ramp” for the
company to seek a reversal of the blockade.
The export ban followed a five-year US
government probe into ZTE’s evasion of
sanctions on Iran and North Korea, first
revealed in March 2016. From January
2010 to March 2016, the company shipped
$32mn of US cellular network equip-
ment to Iran, and made 283 shipments of
cellphones to North Korea, with the full
knowledge of the highest levels of man-
agement, officials said.
called teapots – as crude
importers, resulting in record
refining throughput.
“A number of teapots are
starting new Crude Distillation
Unites (CDUs) and secondary
units, pulling in more crude,”
Meidan said, adding that there
may also be some purchases of
Strategic Petroleum Reserves
(SPRs).
Beyond re-stocking and
teapots, analysts said China’s
growth.
“The prospect of trade
restrictions and counter-
restrictions threatens to...
derail growth prematurely,”
said IMF chief economist
Maurice Obstfeld.
Goldman Sachs does not share
the IMF’s concerns.
Worries about “trade wars
and fears that higher oil prices
will start to weigh on demand
growth... are overdone,” it said.

Alibaba buys Chinese

microchip maker Asia’s second-hand jet market soars
to aid IoT business Reuters
Shanghai

Reuters our cloud-based IoT

Shanghai
E-commerce titan Alibaba
Group Holding Ltd has
bought a Chinese microchip
maker to further its cloud-
based “Internet of things”
(IoT) business, underscoring
its commitment to the
chip industry, an Alibaba
spokeswoman said yesterday.
The announcement comes
days after the United States
banned American firms
from selling chips and other
components to Chinese
telecoms company ZTE Corp
for seven years, a move that
rekindled discussion in China
about the need for self-
sufficient tech supply chains.
Senior Chinese officials held
meetings this week with
industry bodies, regulators
and the country’s powerful
chip fund about speeding
up already aggressive plans
for the sector in the wake of
the ZTE ban, two people with
direct knowledge of the talks
told Reuters.
“Alibaba aims to empower
different industries through
solutions, in which chips
play a significant role,” the
spokeswoman said in a
statement.
“The acquisition of Hangzhou
C-SKY Microsystems, a
leading Chinese supplier
of embedded CPU cores,
underlines our commitment
to driving the development
of the chip industry,” she
said, referring to central
processing units.
Alibaba did not disclose the
terms of the acquisition –
the firm’s first involving a
chipmaker.
The Chinese e-commerce
giant had previously
invested in Hangzhou C-SKY
Microsystems and was now
taking its stake to 100%, in
line with an interest in the
chip industry articulated
late last year, said a person
familiar with the matter who
declined to be identified as
the matter was private.
The person did not believe
the acquisition was
connected to current trade
tensions between China and
the United States involving
tit-for-tat tariffs.
A
sia’s super-wealthy are increas-
ingly opting for second-hand
private jets rather than buying
new ones, as private buyers look for deep
discounts and shorter waiting times, air-
craft brokers said.
Buyers from the region bought 61 pre-
owned aircraft and 54 new jets in 2017,
marking the first time second-hand pur-
chases outstripped new orders, accord-
ing to a report by aviation consultancy
Asian Sky Media.
It underscores how a trend that began
last year has hardened amid slowing eco-
nomic growth in the region, while cost-
conscious Chinese buyers have shunned
flashy symbols of wealth.
Brokers said customers included Chi-
nese companies, which were buying
such jets to support overseas expansion
and opting for used planes to keep costs
down. Pre-owned jet prices have also
seen a steep drop in the past two years,
they said. “Customers have changed, People visit the Asian Business Aviation Conference and Exhibition at Hongqiao International Airport in Shanghai, China. Asia’s
their knowledge of the industry has super-wealthy are increasingly opting for second-hand private jets rather than buying new ones, as private buyers look for deep
changed and they now understand the discounts and shorter waiting times, aircraft brokers said.
value of a pre-owned aircraft,” Jeffrey
Lowe, managing director of consultancy under warranty. So that has certainly “The market base has grown,” said this shift was not negative for planemak-
Asian Sky Media, said on the sidelines of spurred the market.” Planemakers such David Dixon, president of business jet ers such as Gulfstream and Bombardier,
the Asian Business Aviation Conference as General Dynamics Corp’s Gulfstream brokerage Jetcraft Asia. as it was helping to firm prices by reduc-
& Exhibition in Shanghai this week. and Bombardier Inc have reduced pro- “Some people who don’t want to ing an oversupply of used business jets
“The market has had an abundance of duction in recent years as market de- spend $60mn-65mn on one of these, can on the global market.
supply of late, so they were able to find mand contracted and they worked on spend $40mn instead. Customers were also attracted by new
good airplanes at good prices too which releasing new models, resulting in longer There’s a lot you can do with $20mn.” models being pushed out by planemak-
were not necessarily all that old and still waiting times for buyers. Industry executives said however, that ers, brokers said.
 Gulf Times
Saturday, April 21, 2018 3

BUSINESS
China
Huarong
confirms
chairman
departs
GM Korea delays vote on
after probe
Reuters
Shanghai/Hong Kong
bankruptcy protection
Reuters
China Huarong Asset Seoul/Detroit
Management Co confirmed
its chairman Lai Xiaomin,

who is under investigation
for alleged corruption, had
stepped down, sparking an
11% tumble in shares of the
nation’s biggest bad debt
manager yesterday.
Reuters reported earlier this
week, citing sources, that
a senior banking regulator
official would take the helm
at state-owned Huarong
after China’s anti-corruption
watchdog launched a
probe into Lai for “serious
discipline violations”, a
euphemism for graft.
Huarong said in a statement
to the Hong Kong stock
exchange late on Thursday
that Lai’s departure “will not
cause any adverse impact
to the business.”
Wang Zhanfeng, head of
the Guangdong branch of
China’s banking regulator,
had been lined up as its
new chairman and Li Xin,
chief supervisor of China
Orient Asset Management
Co Ltd, would be named
president of Huarong, it
said.
Investors sold down the
stock sharply when trading
resumed on Friday after
being halted earlier this
week.
The Hong Kong-listed shares
fell 11%, their biggest one-
day drop, to hit their lowest
level since January last year
in a slightly softer wider
market.
“People are holding back
on companies haunted by
similar issues involving
management, worried
that they might face some
other hurdles even after
a management reshuffle,”
said Steven Leung, a sales
director at UOB Kay Hian.
He added that the new
chairman’s regulatory
background was viewed as a
long-term positive.
Huarong hit the headlines
this year after building up
a 36% stake in a key unit of
embattled private energy
company CEFC China Energy
which is acquiring a $9.1bn
stake in Russia’s oil major
Rosneft.
The investigation into Lai
makes him the latest in a
long line of top Chinese
executives coming under
fire as China looks to rein in
risks in the financial sector,
targeting riskier lending
G
eneral Motors’ South Korean
unit delayed a decision to file
for bankruptcy protection until
Monday afternoon, after the automaker
failed to reach a wage deal with its la-
bour union in time to meet a yesterday
deadline.
The US automaker shocked South
Korea in February when it unveiled a
major restructuring plan for its money-
losing unit, which involved shuttering
one of its four plants in the country
and voluntary redundancies for 2,600
workers.
GM has sought wage concessions
from the union as well as government
funding and incentives to save its re-
maining three South Korean factories.
The automaker said its Korean unit,
which employs 16,000 people, would
likely file for bankruptcy if no restruc-
turing agreement was reached by yes-
terday.
After failing to reach a tentative
agreement with the company by the
deadline, GM Korea’s labour union re-
quested an extension to continue talks,
aiming to conclude a tentative agree-
ment by 5pm local time on Monday,
April 23.
GM Korea held a board meeting yes-
terday evening to discuss filing for a
court-led rehabilitation, but it delayed
a decision until Monday evening.
“Government officials will engage in
the negotiations over the weekend in an
effort to help reach a tentative labour
agreement between the company and
the union by 5pm Monday,” GM said in
a statement.
Earlier, the union said the two sides
would continue talking until Monday
afternoon.
The Korea Development Bank told
Reuters this week it may sign a pre-
liminary agreement by April 27 to pro-
vide financial support for the business An employee works at an assembly line of GM Korea’s Bupyeong plant in Incheon, South Korea. General Motors said its Korean unit, which employs 16,000 people, would
should an interim due-diligence report likely file for bankruptcy.
due on Friday turn out to be satisfac-
tory. If they fail to reach an agreement, of the nation’s auto industry jobs and tive nature of the talks. Over the past plug on the unit will not come easy for
The US automaker owns 77% of GM more than 150,000 jobs at GM and sup- 16% of auto exports in Asia’s fourth- three years, GM has sought to focus on GM Chief Executive Mary Barra.
Korea, while KDB owns a 17% stake. pliers will be “under threat,” the gov- biggest economy. profitable markets, mainly the United The unit was once the backbone of
GM’s main Chinese partner, SAIC ernment said. A union official previously said the States and China, and new technolo- its Asian strategy and still makes more
Motor Corp, controls the remaining GM Korea’s restructuring also poses thorniest issue was job security for 680 gies such as electric and automated than 1mn assembled or partially assem-
6%. a challenge for South Korean President workers at the Gunsan factory, which is vehicles. bled vehicles for the US, European and
In a statement after talks fell apart Moon Jae-in, who has attached the ut- due to close by May. Although the South Korean unit has emerging markets.
yesterday, South Korea’s government most priority to jobs ahead of local elec- “We don’t want a disaster. We still been hobbled by labour costs and hurt It is also an engineering and design
urged GM Korea and the union to “reach tions scheduled for June. have to keep in mind the worst situa- by GM’s decision to pull its Chevrolet source for GM’s small vehicles and elec-
an agreement swiftly through genuine GM Korea’s future is important for tion,” he said prior to the talks, declin- brand from Europe, a key export mar- tric vehicles, as well as home to some of
dialogue.” South Korea as it accounts for some 13% ing to be identified due to the sensi- ket, any decision on whether to pull the GM’s top-ranked suppliers globally.
TCS set to become India’s first $100bn company in a decade
Bloomberg to more than $98bn. If it achieves that General Motors Co to Citigroup Inc. gramming operations that Tata and its In the near term, TCS continues to
New Delhi milestone, it could outstrip Goldman Backed by the Tata Group, TCS and its peers specialise in. grapple with soaring hiring costs as
Sachs Group Inc and join the ranks of peers built a thriving model adopted Analysts are betting that Tata is immigration curbs hamper its ability
the world’s 100 most valuable corpo- by much of the rest of the world – and among the best-placed to make that to move cheaper Indian workers into

practices and high levels of
corporate debt.
Huarong Investment Stock
Corp Ltd and Huarong
International Financial
Holdings Ltd – which also
earlier suspended trading of
their shares – both dropped
over 10% in late trade
yesterday.
I
t’s good to be back. Tata Consul-
tancy Services Ltd is on the brink
of becoming India’s first $100bn
corporation in a decade, underscoring
the growing importance of the tech-
nology sector to Asia’s third largest
economy.
India’s most valuable company
gained more than 6% yesterday after
unveiling better-than-expected earn-
ings, taking its market capitalisation
rations.
The last Indian name to cross that
threshold – in 2008 – was Reliance In-
dustries Ltd, the telecoms-to-energy
conglomerate controlled by billionaire
Mukesh Ambani.
TCS is the largest of a coterie of
firms including Infosys Ltd that put In-
dian technology on the map, by taking
over many of the back-office support
functions for household names from
fostered the generations of software
engineers that provided much-needed
talent to Silicon Valley.
TCS’ industry, which today gener-
ates some $167bn of revenue annu-
ally, is now going through a painful
transition with the rise of automa-
tion, mobile, artificial intelligence and
cloud computing – converging trends
that’ve pushed clients away from the
labour-intensive back-office pro-
transition.
The company has gained more than
25% this year, putting it on track to
cross the $100bn barrier.
TCS is moving faster than its Indian
peers into digital services, said Rahul
Jain, an analyst with Mumbai-based
Emkay Global Financial Services.
Its digital revenue has expanded by
30% on a trailing 12-month basis, he
estimates.
its largest market, the US. It’s far from
certain whether it can continue to lead
the industry’s digital transition.
Then there’s the expensive training
effort underway to get thousands of
employees up to speed on the digital
era.
“If they need to compete with IBM
and Accenture, they have to do far bet-
ter,” said DD Mishra, research director
at Gartner Inc.

CEFC senior staff banned from overseas

KKR-backed Radiant enters travel amid investigation of its chairman
fray to acquire India’s Fortis Reuters
Beijing/Hong Kong
government agency imposed the ban.
The Ministry of Public Safety did not
$9.1bn. CEFC was financing the deal through
China Development bank and Russian bank
respond to a request from Reuters for a VTB, who was set to provide a loan of €5bn
Reuters the Burman Family Office – are both binding. comment on whether a travel ban has been ($6.15bn).
Bengaluru All the offers value Fortis within a tight range of Chinese authorities have barred senior staff imposed on the CEFC executives. The deal has not closed and remains
$1.2bn-$1.4bn. at embattled Chinese conglomerate CEFC Chinese authorities sometimes put travel uncertain after Ye’s investigation has
Radiant has proposed to spin off the hospital China Energy from travelling overseas amid bans on top corporate executives without highlighted financial difficulties at CEFC,

T
he battle for control of India’s Fortis Health-
care Ltd intensified after KKR-backed Ra-
diant Life Care Private Ltd entered the fray
with an offer to buy more than a quarter of the cash-
strapped company’s hospital business.
In its non-binding offer, Radiant, the fifth
suitor for Fortis, proposed on Thursday to make
an investment and re-structure the company,
Fortis said in a filing that had Radiant’s offer let-
ter attached to it.
“I think now, we will have revised offers coming,”
said Gaurang Shah, head investment strategist at
Geojit Financial Services.
Fortis also said on Thursday that it set up an ad-
visory committee to evaluate binding bids.
The committee is expected to give its recommen-
dation to the board on April 26.
The company has become the target of a takeover
battle that includes offers from China’s Fosun In-
ternational and Malaysia’s IHH Healthcare.
Both offers, however, are non-binding.
The other two offers – from local rival Manipal
Health Enterprises and a consortium of two promi-
nent Indian business families, Hero Enterprise and
business from the larger company to form a new
company, which will exclude Fortis’ stake in Indian
diagnostics chain SRL Ltd.
The all-cash offer to shareholders of the proposed
new company is Rs126 per share, Radiant said.
This offer values the whole of Fortis at Rs165 per
share, or Rs85.58bn ($1.30bn), including the SRL
stake.
The offer is contingent on, among others, Radi-
ant being able to buy 26% or more shares of the pro-
posed new company.
Fortis shares were up 1% yesterday afternoon at
Rs150, in a broader market that was down 0.3%.
The keen interest in Fortis, which runs about 30
hospitals in India, comes as companies and inves-
tors look to tap soaring demand for private health-
care in the South Asian nation against the backdrop
of a stretched public healthcare system.
Private hospitals could also be boosted from
Prime Minister Narendra Modi’s plans to imple-
ment a healthcare programme aimed at providing
insurance cover to about half of India’s population.
KKR & Co owns a 49% stake in Radiant with its
$200mn investment in 2017, Radiant said.
a government investigation of the firm’s
chairman, three sources briefed on the
matter have told Reuters.
The ban affects dozens of CEFC staff at the
vice president-level and above, the people
said.
The exact timing of the ban is unclear.
One of the sources said it has been in place
since mid-February and another said it
started last month.
The three sources said they were briefed
by company executives that attempted to
travel overseas and were denied exit from
China.
The Shanghai-based conglomerate, which
grew from a niche oil trader to a $25bn
company, has faced increasing scrutiny
after its chairman, Ye Jianming, was put
under investigation for suspected economic
crimes earlier this year.
CEFC did not respond to multiple calls for
requests for comment.
The sources could not indicate which
stating a reason, but it is unusual to impose
a blanket ban on a number of company
executives.
The travel ban is another measure that
Chinese authorities are taking amid a
crackdown on companies that have
engaged in highly-leveraged financial deals
and that hold large amounts of corporate
debt.
In February, the Chinese government seized
control of Anbang Insurance Group Co Ltd
and said its chairman had been prosecuted.
Late on Thursday, Huarong Asset
Management Co Ltd said Lai Xiaomin, the
company chairman, had stepped down
following a Reuters report earlier this week
that he was being investigated for suspected
“serious discipline violations”, a euphemism
for graft.
Huarong’s shares fell more than 10%
yesterday.
CEFC made a splash last year agreeing to
buy a 14.16% stake in Russia’s Rosneft for
mainly centred around large holdings of
short-term debt.
Shanghai-based CEFC has around 44bn
yuan ($6.94bn) of short-term borrowing
due by the first half of 2018, according to its
2017 half-year financial report disclosed to
onshore bondholders.
Ahead of Ye’s investigation, CEFC was in
talks with Chinese shadow lenders for
short-tem loans with annual rates of as
much as 36% to make up its cash shortfall,
Reuters reported in March.
In March, Guosheng Group, an investment
firm owned by the Shanghai government,
was tasked with evaluating CEFC’s financial
position as part of a restructuring and
takeover process, two sources told Reuters
at the time.
Reuters reported earlier this month that
a creditor had taken legal action against
CEFC, even as China Development Bank
tried to dissuade lenders from taking
action.
 Gulf Times
4 Saturday, April 21, 2018
BUSINESS
Pakistan to launch National Savings Bond in Gulf states
Internews
Islamabad
In a bid to attract dollar investment
from millions of overseas Pakistanis, the
government has sought applications for
selection of lead managers in order to
launch offshore retail bond for obtain-
ing $1bn investment from Gulf countries
including Saudi Arabia, UAE, Qatar and
others.
“This dollar/rupee bond will be
launched around May 30 this year
with maturity period of 3 to 5 years for
overseas Pakistanis. We are estimating
to attract $1bn investment in one year,”
Director General National Savings Zafar
confirmed.
Australia’s IAG to sell SE Asia
businesses in regional retreat
Reuters
Hong Kong/Singapore
I
nsurance Australia Group is set to
sell its four Southeast Asian busi-
nesses in deals that could be valued
at about $500mn, under a review of its
Asian operations, three people with
knowledge of the matter said.
IAG, Australia’s biggest general in-
surer by market share, has ventures in
Malaysia, Thailand, Vietnam and In-
donesia in Southeast Asia, and could
complete the sale process by the third
quarter, the people said.
Despite years of investments, Asia
has proved a challenge for IAG.
The insurer posted an underwriting
loss in Asia of A$6mn ($4.63mn) in its
fiscal first half of 2018, although that
loss narrowed from A$9mn in the sec-
ond half of 2017.
Asia’s overall earnings contribu-
tion decreased to A$10mn in 2017 from
A$26mn a year earlier.
A spokeswoman for IAG in Australia
said the insurer had announced plans
to review Asia strategy, not to exit the
region.
She declined to comment on whether
the company had made a decision to
exit those specific markets.
IAG also operates in India and owns
a 16.9% stake in Bohai Property Insur-
ance Company Ltd in China.
IAG said in February that it was re-
viewing its Asian operations in the face
of a lack of buying opportunities to
boost growth in a region attractive for
its low penetration rates but which is
also very competitive.
An exit would mean IAG joins other
Australian financial firms, includ-
ing Commonwealth Bank of Australia
(CBA), that are retreating from Asian
insurance markets to focus on their
home businesses.
IAG owns a 49% stake in its Malay-
sian venture, AmGeneral Holdings Bhd,
the general insurance arm of AmBank
Australian bank inquiry claims AMP scalp
Meller: Charged with board-level
deception and misappropriation
of funds.
India bond yields spike after monetary panel meeting minutes flag inflation risks
Reuters
Mumbai
I
ndian bond yields spiked while the
rupee dropped to its lowest in more
than a year yesterday after minutes
of the monetary policy committee’s
last meeting suggested it was likely to
take a more hawkish stance – starting
as early as June.
The monetary policy committee
members flagged several concerns, in-
He said that the selected lead man-
ager would suggest fixed rate on this
offshore dollar bond which would be
100 to 150 basis points less than Sukuk
and Eurobond but it might be higher
than the market rate in the respective
GCC countries in order to lure overseas
Pakistanis for making investment in this
saving certificate.
“This bond had nothing to do with lat-
est Amnesty Scheme,” he said and added
that the local Pakistanis would not be
allowed to invest in this scheme because
it could pave the way for dollarisation if
the government allowed them to invest in
this scheme.
The government has granted permis-
sion to Central Directorate of National
Savings (CDNS) for launching saving
Pedestrians walk past the headquarters of Insurance Australia Group in central Sydney. IAG, Australia’s biggest general insurer by market share, has ventures in Malaysia,
Thailand, Vietnam and Indonesia in Southeast Asia.
Group. It has a 99% stake in Thailand’s
Safety Insurance, according to its Feb-
ruary investor report.
The insurer also holds an 80% stake
in Indonesian non-life insurer PT As-
uransi Parolamas and has 63% of AAA
Assurance Corp in Vietnam.
Malaysia and Thailand account for
the bulk of its premium income in
Reuters
Sydney
A
n Australian inquiry into finan-
cial sector misconduct claimed
its first scalp yesterday as the
CEO of the country’s largest wealth
manager stepped down over rev-
elations of board-level deception and
misappropriation of funds.
The departure of AMP Ltd’s Craig
Meller came as the government vowed
to double prison terms for financial
crimes, dramatically increase penalties
and ramp up the investigative powers
of the corporate regulator following
shocking admissions of misconduct to
the Royal Commission inquiry.
Not only has the start of the year-
long inquiry been a publicity disaster
for Australia’s major lenders, it has also
cluding an increase in minimum sup-
port prices for farmers and high and
volatile crude oil prices, the minutes
released after market hours on Thurs-
day showed.
Viral Acharya, a deputy governor at
the central bank, said he would “de-
cisively” vote to begin “withdrawal of
accommodation” at the next monetary
policy meeting in June.
“The MPC panel shifted to a neu-
tral stance in the February 2017 policy
meeting, so do we even have an ac-
certificate bond within the current fiscal
year but investment will start pouring in
by June in this fiscal and months coming
in next financial year 2018-19.
This scheme is expected to be
launched before May 30, 2018 and it will
remain on top for attracting investments
from offshore investors and its markup
will be paid simultaneously in both US
dollar and rupee components which one
will be liked by the investors.
“We can attract $1bn with launch of
Overseas Pakistanis Savings Certificates
(OPSCs),” top official sources confirmed
yesterday.
The CDNS has sought applications till
April 30, 2018 for selection of lead man-
ager probably comprising consortium
of a few selected banks having patron-
Southeast Asia, said one of the people
with knowledge of the matter.
The Malaysian entity could be ap-
pealing to firms including Maybank
Holdings’ insurance venture, Etiqa,
Japanese insurer Tokio Marine and
Chinese insurer Fosun, the people said,
declining to be named as they were not
authorised to speak to the media.
put the conservative government –
which had initially opposed a commis-
sion despite years of scandals including
rate-rigging and alleged money-laun-
dering – in a tight spot.
Faced with daily revelations of
wrongdoing at the highest levels of
corporate Australia, the government
is now under mounting pressure to
extend the inquiry beyond its Febru-
ary 2019 deadline, meaning it would
run concurrently with the next fed-
eral election. Treasurer Scott Morrison,
who once dismissed opposition calls
for a Royal Commission as “crass pop-
ulism”, yesterday said the government
would raise criminal penalties for cor-
porate crimes to a maximum of 10 years
in jail, from 5 years currently.
Offending companies would face
fines up to A$210mn ($162mn), versus
A$10mn now. Australian Securities
commodative policy in the first place,”
asked a senior bond trader at a private
bank.
“Market sentiment is extremely
bad because when you lower the in-
flation projection by 70 basis points,
why would you have such an hawkish
stance,” he added, predicting a range
of 7.60% to 8% on the 10-year in the
near term.
The MPC sharply trimmed its April-
September inflation projection to
4.7% to 5.1% from the 5.1% to 5.6% it
age in Gulf countries where the National
Savings Scheme (NSS) wanted to deepen
its footprint by attracting investments
from overseas Pakistanis. “We will attract
offshore investment into this dollar bond,”
said the official.
According to official announcement
made here yesterday, the National Sav-
ings, along with their Advisers EY Ford
Rhodes and HaidermotaBNR organised a
pre-bid conference in Karachi with local
and international banks for selection
of the lead manager for the upcoming
product specifically for the overseas
Pakistanis.
The government has decided to launch
a retail bond under the platform of Na-
tional Savings called Overseas Pakistanis
Savings Certificates (OPSCs). OPSCs will
Fosun did not immediately respond
to Reuters queries. Tokio Marine and
Maybank declined to comment.
One source said bids for IAG’s busi-
nesses in Thailand, Indonesia and Viet-
nam were expected in a few weeks.
The Malaysian divestment process
is likely to be completed in the current
quarter or early third quarter, another
and Investments Commission (ASIC)
would get the power to intercept inter-
nal communications of companies if
necessary, Morrison said.
“They are not victimless crimes,”
Morrison told a press conference. “We
need to set the tone... so people under-
stand that misleading regulators about
serious issues such as this is no victim-
less offence, and it won’t carry a vic-
timless penalty.”
The changes were the result of years
of planning and were not a knee-jerk
reaction to the inquiry, he said.
AMP executives admitted in testi-
mony this week that the company had
lied to the corporate watchdog for al-
most a decade to cover a practice of
charging customers for services it did
not provide.
Chairman Catherine Brenner issued
an unreserved apology for “misconduct
predicted in February. The benchmark
10-year bond yield rose as much as 17
basis points to 7.80% in early trade, its
highest level since February 22.
It was trading at 7.74% by 0635
GMT.
The Indian rupee was at 66.01/02
per dollar versus its previous close of
65.7950.
It touched 66.08 in early deals, its
weakest level since March 14, 2017.
“Higher oil prices, foreign insti-
tutional investors selling in the debt
be a script less retail certificates in both
the US dollar and Pakistan rupee, which
are being initially launched in Gulf Co-
operation Council (GCC) countries.
National Savings desires to hire
services of a bank or financial institution
which has got comprehensive and robust
operations, custody business and strong
compliance mechanism with the local
presence in Pakistan. After the hiring of
the MTI, the OPSCs product is expected to
be launched by May 30, 2018 in the target
markets.
Huzefa Mazahir of EY Ford Rhodes
briefed the participants about the salient
features of the OPSCs and described
the objectives comprehensively which
National Savings desires to attain through
hiring of the MTI for OPSCs product. Ali
person said. This month, IAG said it
expected a “potential inflow” of capital
from Asian divestments.
It did not provide financial details on
the impact of the review, but Macquarie
analysts estimate it will ultimately exit
most markets in the region and free up
about A$800mn ($621mn) of capital in
the next few years.
and failures in regulatory disclosures in
our advice business”, as she announced
Meller’s exit along with a review of the
company’s governance.
Government data prepared for the
Royal Commission, which has the pow-
er to subpoena documents and com-
pel top executives to testify in public,
shows more than 80,000 consumers
have been given bad advice by financial
institutions over the past decade, cost-
ing them a total A$5bn ($3.9bn).
This week’s hearings have been par-
ticularly brutal.
A nurse gave tearful testimony on
Thursday about losing her home after
taking advice from Westpac Banking
Corp, while lawyers presented evidence
that Commonwealth Bank of Australia,
the country’s biggest bank, knowingly
charged dead clients for counsel for
years.
markets and the government buying
dollars to make some defence pay-
ments are the reasons the dollar/
rupee moved up,” said Murthy Na-
garajan, head of fixed income at Tata
Asset Management.
Traders said expectations for a rate
hike in 2018 have risen in the wake of
the minutes.
The said they would continue to be
cautious while buying more debt and
monitor the inflation data for further
guidance as well as global crude oil
Akbar from HaidermotaBNR commented
on the legal aspects of the proposed
product.
Zafar Masud, director general, National
Savings, answered the queries raised by
the participants and clarified the issues
related to the new scheme of National
Savings. Masud described the process of
OPSCs products structuring as first-of-its-
kind in the world given its professional
process and management undertaken by
National Savings.
Zafar Masud thanked all the partici-
pants for joining the pre-bid conference
call. The participants from the World
Bank, Standard Chartered, DIB Pakistan,
UBL, MCB, Samba Bank, Pakistan Stock
Exchange and other financial institutions
joined the pre-bid conference.
UK firms
announce
investment
plans in
Pakistan
Internews
Karachi
T
he UK firms have an-
nounced £100mn
(Rs16.3bn) investment in
Pakistan in oil and other sectors.
According to the British High
Commission, oil giant Shell is
planning to set up around one-
hundred new fuel stations along
the CPEC route at selective loca-
tions representing up to £13mn
of investment by 2020.
Global consumer brand Uni-
lever will also invest £86mn in
new manufacturing capacity
at its four factories in Pakistan,
acknowledging the country’s
high potential for long-term,
sustainable growth, and high-
lighting the increasing uptake of
consumer goods products across
the country.
UK Trade Minister Greg
Hands and Pakistan’s Minister
for Commerce Pervaiz Malik
welcomed the investment into
fuel stations and manufactur-
ing at a meeting in London
yesterday.
They were joined by the Prime
Minister’s Trade Envoy to Pa-
kistan Rehman Chishti MP. It
follows Minister Hands’ visit to
Pakistan in September last year
where the UK and Pakistan con-
firmed their ambition to increase
bilateral trade and the UK con-
firmed its intention to maintain
the preferential access Pakistan
receives to the UK to support
Pakistani economic growth after
the UK leaves the EU.
Trade Minister Greg Hands
said as the prime minister has
made clear, the Commonwealth
has a unique opportunity to
boost its trade links and drive
prosperity and growth among its
members.
Pakistan is a prime example of
this, with its growing trade with
the UK and investment powering
economic growth. Unilever and
Shell are showing what UK com-
panies can achieve in Pakistan’s
growing market of 200mn cus-
tomers, and the UK government
is ready to help.
The UK is Pakistan’s biggest
trade partner in the EU, with
bilateral trade increasing 8%
between 2015 and 2016 and 2%
of all Britons tracing their roots
back to Pakistan.
Greg Hands also reiterated
the UK’s ambition to continue
its preferential trade terms with
Pakistan, supporting economic
development, after it leaves the
EU, continuing the terms of the
GSP Plus scheme which offers
low tariff access to the EU in ex-
change for progress on human
rights, labour rights, environ-
mental protection and tackling
corruption.
prices which have been a major driv-
er for bonds in recent months.
The stock market took the min-
utes calmly with India’s broader NSE
share index trading down 0.25% yes-
terday in line with its Asian peers
while the banking index was down
0.8%.
India’s headline inflation was
4.28% in March versus a year ear-
lier, easing from 4.44% February, but
well above the central bank’s medi-
um-term target of 4%.
 Gulf Times
Saturday, April 21, 2018 5

BUSINESS
DJIA WORLD INDICES
Company Name Lt Price % Chg Volume Indices Lt Price Change
Dow Jones Indus. Avg 24,463.19 -201.70
Apple Inc 167.04 -3.33 35,428,201 S&P 500 Index 2,675.03 -18.10
Microsoft Corp 94.45 -1.73 11,958,169 Nasdaq Composite Index 7,157.31 -80.75
Exxon Mobil Corp 78.67 -0.94 4,579,149 S&P/Tsx Composite Index 15,484.67 +30.25
Johnson & Johnson 126.56 -0.78 2,992,716 Mexico Bolsa Index 48,384.82 -360.46
General Electric Co 14.51 3.75 107,607,022 Brazil Bovespa Stock Idx 85,419.21 -405.05
Jpmorgan Chase & Co 111.88 0.14 6,313,594 Ftse 100 Index 7,368.17 +39.25
Procter & Gamble Co/The 73.98 -1.30 6,316,984 Cac 40 Index 5,412.83 +21.19
Walmart Inc 87.21 -0.78 2,559,982 Dax Index 12,540.50 -26.92
Verizon Communications Inc 48.02 -0.85 3,832,886 Ibex 35 Tr 9,884.20 +16.20
Pfizer Inc 36.66 0.34 7,040,776
Nikkei 225 22,162.24 -28.94
Visa Inc-Class A Shares 123.96 0.00 2,937,305
Japan Topix 1,751.13 +0.95
Chevron Corp 122.05 -1.34 2,679,904
Hang Seng Index 30,418.33 -290.11
Coca-Cola Co/The 43.70 -1.38 5,422,322
All Ordinaries Indx 5,964.39 -11.98
Intel Corp 51.17 -2.02 11,815,751
Nzx All Index 1,481.66 -8.47
Merck & Co. Inc. 58.95 0.53 4,413,020
Bse Sensex 30 Index 34,415.58 -11.71
Cisco Systems Inc 43.94 -1.40 8,368,872
Nse S&P Cnx Nifty Index 10,564.05 -1.25
Home Depot Inc 176.99 -0.05 2,093,488
Straits Times Index 3,573.38 -25.35
Intl Business Machines Corp 144.90 -1.90 3,450,658
Karachi All Share Index 32,748.18 +10.67
Walt Disney Co/The 100.14 -0.74 2,535,758
Jakarta Composite Index 6,337.70 -18.21
Unitedhealth Group Inc 233.79 -0.84 912,112
3M Co 217.21 -0.75 1,102,879
Mcdonald’s Corp 159.56 0.02 1,336,340
Nike Inc -Cl B 65.95 0.33 4,456,288 TOKYO
United Technologies Corp 123.65 -0.16 2,695,571
Boeing Co/The 337.31 -0.98 1,302,996 Company Name Lt Price % Chg Volume
Goldman Sachs Group Inc 253.66 -0.20 1,123,603
Rakuten Inc 779.30 -1.67 13,123,400
American Express Co 100.94 -1.40 2,147,940
Kyocera Corp 6,228.00 -0.56 1,743,400
Caterpillar Inc 153.97 -0.61 1,636,157
Nissan Motor Co Ltd 1,135.00 -0.04 10,228,700
Travelers Cos Inc/The 136.37 -0.16 501,078
Hitachi Ltd 790.00 0.09 10,953,000
Takeda Pharmaceutical Co Ltd 4,857.00 -4.67 8,307,500
Jfe Holdings Inc 2,273.00 0.00 1,748,400
Ana Holdings Inc 4,229.00 1.05 851,400
FTSE 100 Mitsubishi Electric Corp 1,714.00 -2.39 5,547,600
Sumitomo Mitsui Financial Gr 4,522.00 0.69 5,771,000
Company Name Lt Price % Chg Volume Honda Motor Co Ltd 3,682.00 -0.24 3,920,300
Fast Retailing Co Ltd 47,510.00 0.87 559,100 A visitor passes a London Stock Exchange sign inside the main atrium of the London Stock Exchange Group headquarters in
Wpp Plc 1,146.50 -0.82 4,062,546
Worldpay Group Plc 0.00 0.00 -
Ms&Ad Insurance Group Holdin 3,600.00 0.64 1,607,900 London. The FTSE 100 index gained 0.5% at 7,348.17 points yesterday.
Kubota Corp 1,829.00 0.05 2,001,200
Wolseley Plc 0.00 0.00 -
Seven & I Holdings Co Ltd 4,760.00 -0.31 2,123,100
Wm Morrison Supermarkets 234.30 0.56 8,521,015
Inpex Corp 1,419.00 0.64 4,194,200

Pound slides as rate

Whitbread Plc 4,235.00 1.17 415,838
Resona Holdings Inc 587.50 0.15 10,119,200
Vodafone Group Plc 210.00 1.62 58,361,688
Asahi Kasei Corp 1,506.00 -0.46 3,161,200
United Utilities Group Plc 717.20 0.73 2,001,180
Kirin Holdings Co Ltd 3,124.00 -0.32 2,220,500
Unilever Plc 3,872.50 0.30 2,341,414
Marubeni Corp 801.30 0.94 4,185,200
Tui Ag-Di 1,624.00 0.96 775,174
Mitsubishi Ufj Financial Gro 716.30 0.27 62,120,600
Travis Perkins Plc 1,315.00 0.31 864,845
Mitsubishi Chemical Holdings 1,056.00 -0.66 4,476,000

hike prospect dims

Tesco Plc 239.40 -0.13 24,158,992
Fanuc Corp 26,250.00 -2.34 1,272,800
Taylor Wimpey Plc 194.00 0.26 14,740,267
Daito Trust Construct Co Ltd 18,600.00 -0.51 328,400
Standard Life Plc 0.00 0.00 -
Otsuka Holdings Co Ltd 5,302.00 -0.66 924,500
Standard Chartered Plc 764.40 2.56 9,121,763
Oriental Land Co Ltd 10,785.00 1.17 367,400
St James’s Place Plc 1,109.50 0.23 2,048,075
Sekisui House Ltd 1,945.50 -0.61 1,568,100
Sse Plc 1,327.50 0.30 2,250,374
Secom Co Ltd 8,165.00 -0.06 427,600
Smith & Nephew Plc 1,352.00 0.82 2,220,807
Sky Plc 1,312.00 -0.53 810,530
Tokio Marine Holdings Inc 4,968.00 1.16 1,567,800
AFP ates higher returns for investors. its offer for Shire yesterday.
Aeon Co Ltd 2,077.00 1.05 2,471,500 The British currency came off its The Paris market posted slight gains
Shire Plc 3,821.50 -3.86 9,007,663 London
Mitsui & Co Ltd 1,917.00 1.40 6,375,100
Severn Trent Plc 1,881.50 0.56 963,292 lows after Carney’s fellow BoE policy- with the CAC 40 up 0.4% at 5,412.83
Kao Corp 7,853.00 0.56 1,180,400
Schroders Plc 3,283.00 0.80 304,342
Dai-Ichi Life Holdings Inc 2,067.50 1.97 7,579,500
maker Michael Saunders hinted that he points, and Frankfurt was down 0.2%

T
Sainsbury (J) Plc 263.90 -0.26 7,270,273 he pound fell yesterday after could vote for a hike in May. at 12,540.50 points at close. The EURO
Mazda Motor Corp 1,472.00 -0.24 3,334,100
Sage Group Plc/The 630.80 0.13 2,516,326
Komatsu Ltd 3,708.00 -0.62 5,295,400 Bank of England governor Mark The London stock market’s FTSE STOXX 50 ended 0.2% up at 3,494.20
Abi Sab Group Holding Ltd 0.00 0.00 -
Rsa Insurance Group Plc 653.00 0.99 1,885,992
West Japan Railway Co 7,588.00 0.34 429,900 Carney shook the market’s con- 100 index gained 0.5% at 7,348.17 points.
Royal Mail Plc 560.00 -0.53 3,232,185
Murata Manufacturing Co Ltd 14,215.00 -1.97 888,300 fidence in an early interest rate hike, points, outperforming its European Wall Street was down in the late
Kansai Electric Power Co Inc 1,484.00 0.07 3,318,400 dealers said. peers, as the pound’s weakness boost- New York morning trading as investors
Royal Dutch Shell Plc-B Shs 2,548.00 0.51 4,310,364
Denso Corp 5,919.00 0.80 1,937,600
Royal Dutch Shell Plc-A Shs 2,497.00 0.52 5,289,857 “Carney put an end to the debate, ed share prices of multinationals listed worried about rising bond yields, with
Sompo Holdings Inc 4,419.00 1.10 759,800
Royal Bank Of Scotland Group 274.20 0.73 10,693,073
Daiwa House Industry Co Ltd 4,024.00 -0.05 1,155,500
saying that markets should not bet on in London which derive much of their some fearing that they may be a pre-
Rolls-Royce Holdings Plc 866.20 -1.21 4,256,421 a May rate rise,” noted Jasper Lawler, earnings in dollars. cursor to higher Fed rates.
Jxtg Holdings Inc 713.00 0.81 13,835,100
Rio Tinto Plc 3,987.00 0.89 2,765,979
Nippon Steel & Sumitomo Meta 2,422.50 0.06 2,929,700 head of research at London Capital In company activity, Irish build- While worries about the Syrian
Rexam Ltd 0.00 0.00 -
Relx Plc 1,544.00 1.21 2,177,800
Suzuki Motor Corp 5,747.00 -1.00 2,116,600 Group. ing materials group CRH topped the crisis and a potential China-US trade
Reckitt Benckiser Group Plc 5,625.00 -2.78 3,871,686
Nippon Telegraph & Telephone 5,169.00 -0.08 2,356,300 Markets had been widely pricing in a FTSE risers board, rising almost 4% on war keep dealers on edge, focus has
Ajinomoto Co Inc 1,973.50 0.15 1,398,300 for now moved to the corporate arena
Randgold Resources Ltd 5,742.00 -0.31 357,753 quarter-point interest rate hike in May, swirling speculation over a US listing
Mitsui Fudosan Co Ltd 2,704.00 -0.07 2,456,000
Prudential Plc 1,875.00 1.13 3,594,807
Ono Pharmaceutical Co Ltd 2,482.50 -0.02 2,985,100
to 0.75%, amid a pick-up in UK wage and share buybacks, dealers said. as the earnings season gets into full
Provident Financial Plc 690.40 -0.38 280,166
Daikin Industries Ltd 12,855.00 0.23 783,100 growth, but British economic data this Among big losers, British consumer swing.
Persimmon Plc 2,717.00 0.56 721,638 Oil prices ran into profit-taking after
Bank Of Yokohama Ltd/The 0.00 0.00 - week, including a sharp drop in retail health giant Reckitt Benckiser saw its
Pearson Plc 784.00 1.08 2,968,627
Paddy Power Betfair Plc 7,305.00 -0.48 80,469
Toray Industries Inc 1,022.50 -0.29 3,087,300 sales, had started to dampen those ex- share price dive on a poor trading up- US President Donald Trump targeted
Old Mutual Plc 242.60 0.04 5,102,882
Astellas Pharma Inc 1,582.00 -0.63 4,199,700 pectations. date. Opec for what he said were artificially
Bridgestone Corp 4,572.00 -0.17 3,208,000 “Prepare for a few interest rate rises Shire Pharmaceuticals fell sharp- high oil prices, saying they “will not be
Next Plc 5,220.00 -0.11 418,805
Sony Corp 5,385.00 0.26 5,184,800
National Grid Plc 812.90 0.33 8,017,296 over the next few years,” Carney told ly as fellow Irish drug maker Aller- accepted”.
Hoya Corp 5,772.00 -1.05 1,059,700
Mondi Plc 2,014.00 0.40 944,535
Sumitomo Mitsui Trust Holdin 4,497.00 0.67 868,200
the BBC.”I don’t want to get too fo- gan ruled out a takeover bid to rival His comments on Twitter came as
Merlin Entertainment 346.20 -1.28 4,902,714 cused on the precise timing, it is more an offer by Japan’s Takeda, having ministers from some top global crude
Japan Tobacco Inc 2,892.00 -2.38 11,109,900
Mediclinic International Plc 690.60 2.37 2,020,620
Osaka Gas Co Ltd 2,273.50 -0.35 721,300 about the general path.” earlier said it was mulling such a producers met in Saudi Arabia to dis-
Marks & Spencer Group Plc 280.60 0.00 5,164,456
London Stock Exchange Group 4,250.00 0.00 357,876
Sumitomo Electric Industries 1,657.50 0.09 2,190,600 Higher interest rates typically move. cuss maintaining limits on oil produc-
Lloyds Banking Group Plc 65.70 -0.59 145,911,289
Daiwa Securities Group Inc 672.00 1.04 7,323,000 boost a currency as holding it gener- Takeda, meanwhile, slightly raised tion.
Softbank Group Corp 8,277.00 0.73 3,749,600
Legal & General Group Plc 275.20 0.62 13,722,301
Mizuho Financial Group Inc 195.30 0.15 103,068,200
Land Securities Group Plc 971.80 1.18 1,339,395
Nomura Holdings Inc 636.90 0.08 8,846,900
Kingfisher Plc 309.00 1.25 10,867,781
0.91
HONG KONG HONG KONG
Daiichi Sankyo Co Ltd 3,758.00 1,253,900
Johnson Matthey Plc 3,265.00 0.06 395,502
Subaru Corp 3,514.00 -0.28 3,478,400
Itv Plc 144.95 -0.24 8,026,562 Company Name Lt Price % Chg Volume Company Name Lt Price % Chg Volume
Ntt Docomo Inc 2,761.50 0.04 2,858,700
Intu Properties Plc 202.30 4.09 6,492,726
Sumitomo Realty & Developmen 4,050.00 0.87 898,000 Aluminum Corp Of China Ltd-H 5.02 -2.52 58,375,788 Hong Kong & China Gas 16.16 -0.37 7,724,147
Intl Consolidated Airline-Di 611.00 -0.23 3,720,748
Sumitomo Metal Mining Co Ltd 4,882.00 1.37 2,219,900 Bank Of East Asia Ltd 33.40 -0.30 1,760,310 Hong Kong Exchanges & Clear 260.20 -0.08 4,821,027
Intertek Group Plc 4,926.00 0.41 234,092
Orix Corp 1,894.00 0.16 2,932,100 Bank Of China Ltd-H 4.17 -1.18 273,429,020 Hsbc Holdings Plc 76.80 0.66 34,244,927
Intercontinental Hotels Grou 4,370.00 -0.57 466,662
Asahi Group Holdings Ltd 5,480.00 -0.33 1,223,100 Bank Of Communications Co-H 6.24 -0.95 29,679,322 Hutchison Whampoa Ltd 0.00 0.00 -
Inmarsat Plc 375.80 3.24 2,719,237
Keyence Corp 63,490.00 0.14 291,000 Belle International Holdings 0.00 0.00 - Ind & Comm Bk Of China-H 6.77 -1.74 221,729,030
Informa Plc 730.60 0.16 4,537,077
Nidec Corp 16,785.00 0.27 504,700 Boc Hong Kong Holdings Ltd 38.95 -0.51 7,678,310 Li & Fung Ltd 3.91 -0.26 10,167,000
Imperial Brands Plc 2,402.50 2.02 2,251,152
Isuzu Motors Ltd 1,652.50 0.27 1,121,700 Cathay Pacific Airways 12.46 -0.16 3,896,100 Mtr Corp 43.40 -0.12 2,403,040
Hsbc Holdings Plc 701.20 1.52 24,973,642
Unicharm Corp 3,031.00 1.00 957,400 Ck Hutchison Holdings Ltd 93.00 -0.75 2,750,491 New World Development 11.32 -0.53 7,157,955
Hargreaves Lansdown Plc 1,736.00 0.00 454,067
Shin-Etsu Chemical Co Ltd 10,670.00 -4.86 2,295,300 China Coal Energy Co-H 3.17 -1.55 14,138,000 Petrochina Co Ltd-H 5.87 -1.18 184,853,657
Hammerson Plc 540.00 3.97 8,203,503
Smc Corp 42,360.00 -2.06 183,800 China Construction Bank-H 8.06 -1.47 227,840,100 Ping An Insurance Group Co-H 81.50 -0.31 48,294,397
Glencore Plc 380.65 0.70 48,853,410
Mitsubishi Corp 2,955.50 0.60 4,039,000 China Life Insurance Co-H 21.75 -0.68 30,072,618 Power Assets Holdings Ltd 58.95 -0.51 3,057,089
Glaxosmithkline Plc 1,430.00 1.61 7,593,052
Nintendo Co Ltd 45,900.00 3.94 3,151,200 China Merchants Port Holding 17.16 -1.38 2,812,288 Sino Land Co 13.18 -1.20 2,411,248
Gkn Plc 467.90 -2.03 9,182,653
Eisai Co Ltd 7,074.00 -0.27 803,700 China Mobile Ltd 73.10 0.41 22,880,978 Sun Hung Kai Properties 123.10 -1.36 3,236,817
Fresnillo Plc 1,298.00 -0.27 486,240
Sumitomo Corp 1,914.00 1.73 3,984,400 China Overseas Land & Invest 26.05 -2.07 18,123,896 Swire Pacific Ltd - Cl A 77.30 -1.90 1,354,992
Experian Plc 1,606.50 2.00 1,905,404
Canon Inc 3,882.00 0.31 2,934,400 China Petroleum & Chemical-H 7.50 -2.60 110,216,711 Tencent Holdings Ltd 400.20 -1.38 18,108,773
Easyjet Plc 1,603.00 -0.31 1,667,807
Japan Airlines Co Ltd 4,222.00 0.76 959,900 China Resources Beer Holdin 34.60 -1.56 3,115,646 Wharf Holdings Ltd 25.45 -0.59 4,184,920
Dixons Carphone Plc 210.20 0.19 3,176,370
Direct Line Insurance Group 372.70 1.03 6,071,984 China Resources Land Ltd 28.60 -2.05 11,877,029
Diageo Plc 2,465.00 0.04 2,973,559 China Resources Power Holdin 14.44 -0.55 7,398,933
SENSEX China Shenhua Energy Co-H 19.36 -2.02 17,432,512
Dcc Plc
Crh Plc
6,825.00
2,525.00
-0.80
4.08
468,808
2,419,784 China Unicom Hong Kong Ltd 10.40 -0.95 34,076,248 GCC INDICES
Compass Group Plc 1,503.00 0.87 2,014,025 Company Name Lt Price % Chg Volume Citic Ltd 11.40 -1.21 4,075,615 Indices Lt Price Change
Coca-Cola Hbc Ag-Di 2,496.00 -0.24 374,397 Clp Holdings Ltd 81.05 -0.18 1,251,876 Doha Securities Market 9,196.62 +141.60
Zee Entertainment Enterprise 587.70 -0.88 895,678
Centrica Plc 146.20 0.34 15,536,148 Cnooc Ltd 12.92 -2.42 68,980,818 Saudi Tadawul 8,277.14 +131.01
Yes Bank Ltd 308.55 -3.12 23,411,499
Carnival Plc 4,673.00 1.32 488,130 Cosco Shipping Ports Ltd 6.49 -0.31 2,429,550 Kuwait Stocks Exchange 6,633.44 +29.93
Wipro Ltd 298.05 1.91 3,577,207
Capita Plc 159.80 5.72 7,155,778 Esprit Holdings Ltd 2.35 -4.08 6,471,512 Bahrain Stock Exchage 1,301.40 -0.58
Vedanta Ltd 308.60 -0.99 14,176,221
Burberry Group Plc 1,735.00 1.20 1,307,827 Fih Mobile Ltd 1.39 -6.71 13,614,727 Oman Stock Market 4,759.65 +7.70
Ultratech Cement Ltd 4,080.90 -0.55 198,337
Bunzl Plc 2,130.00 0.52 690,607 Hang Lung Properties Ltd 18.22 -0.76 2,759,111 Abudhabi Stock Market 4,706.56 +24.48
Tech Mahindra Ltd 700.50 5.31 5,777,167
Bt Group Plc 241.80 0.62 17,753,538 Hang Seng Bank Ltd 194.30 0.10 1,838,576 Dubai Financial Market 3,082.09 -5.66
Tata Steel Ltd 606.20 -2.53 6,798,855
British Land Co Plc 666.00 0.76 3,020,748 Henderson Land Development 50.25 -0.30 1,678,544
Tata Power Co Ltd 85.90 -1.04 4,268,941
British American Tobacco Plc 3,700.00 1.37 8,041,413
Tata Motors Ltd 336.00 0.52 12,711,284
Bp Plc 518.20 0.33 26,093,133
Tata Consultancy Svcs Ltd 3,402.45 6.62 10,004,786
Bhp Billiton Plc 1,534.40 0.91 7,793,701
Sun Pharmaceutical Indus 505.30 -0.77 4,558,704
Berkeley Group Holdings/The 3,966.00 0.41 614,674 “Information contained herein is believed to be reliable and had been obtained from sources believed to be reliable. The
State Bank Of India 241.20 -2.01 16,723,024
Barratt Developments Plc 559.60 1.19 3,943,915
Reliance Industries Ltd 927.90 -1.53 3,564,445 accuracy and completeness cannot be guaranteed. This publication is for providing information only and is not intended
Barclays Plc 215.50 0.61 38,662,552
Punjab National Bank 93.60 -2.60 23,753,956 as an offer or solicitation for a purchase or sale of any of the financial instruments mentioned. Gulf Times and Doha Bank
Bae Systems Plc 601.00 1.45 13,560,244 or any of their employees shall not be held accountable and will not accept any losses or liabilities for actions based on
Power Grid Corp Of India Ltd 207.20 -0.43 3,155,598
Babcock Intl Group Plc 744.60 0.62 889,676
Oil & Natural Gas Corp Ltd 182.35 -0.87 1,792,001 this data.”
Aviva Plc 522.00 -0.61 13,826,125
Ntpc Ltd 174.35 -1.80 3,032,075
Astrazeneca Plc 4,976.00 0.41 1,421,778
Maruti Suzuki India Ltd 9,025.00 -0.58 318,208
Associated British Foods Plc 2,631.00 -0.49 897,503
Ashtead Group Plc 2,071.00 0.10 1,688,134
Mahindra & Mahindra Ltd
Lupin Ltd
799.50
799.90
-0.30
1.21
2,621,194
1,483,477
CURRENCIES
Arm Holdings Plc 0.00 0.00 - DOLLAR QATAR RIYAL SAUDI RIYAL UAE DIRHAMS BAHRAINI KUWAITI
Larsen & Toubro Ltd 1,365.05 -1.44 1,390,221
Antofagasta Plc 952.80 -0.98 2,247,067 DINAR DINAR
Kotak Mahindra Bank Ltd 1,152.85 -0.09 1,242,850
Anglo American Plc 1,767.20 -0.91 4,856,895
Itc Ltd 276.20 -0.41 12,001,744
Admiral Group Plc 1,997.00 1.14 720,124
Infosys Ltd 1,178.45 4.03 12,698,625
3I Group Plc 917.80 0.09 1,135,185
Indusind Bank Ltd 1,812.85 -1.10 1,902,741
#N/A 0.00 0.00 -
Idea Cellular Ltd 70.85 -0.14 8,794,790
Icici Bank Ltd 282.15 -2.57 20,311,929
Housing Development Finance 1,834.15 -1.32 3,506,870
TOKYO Hindustan Unilever Ltd 1,467.80 0.94 696,187
Hindalco Industries Ltd 262.10 -1.00 24,476,862
Company Name Lt Price % Chg Volume Hero Motocorp Ltd 3,742.70 0.51 407,642
East Japan Railway Co 10,190.00 1.09 605,400 Hdfc Bank Limited 1,955.90 0.87 2,414,565
Itochu Corp 2,139.50 -0.51 4,086,600 Hcl Technologies Ltd 1,062.35 4.30 4,923,980
Fujifilm Holdings Corp 4,357.00 -0.07 905,200 Grasim Industries Ltd 1,100.80 -0.30 366,809
Yamato Holdings Co Ltd 2,895.50 1.54 1,660,000 Gail India Ltd 330.55 -1.43 4,096,922
Chubu Electric Power Co Inc 1,674.00 0.84 2,756,100 Dr. Reddy’s Laboratories 2,121.90 -0.67 279,730
Mitsubishi Estate Co Ltd 1,892.00 0.75 3,960,000 Coal India Ltd 292.05 3.13 2,609,948
Mitsubishi Heavy Industries 4,186.00 0.31 706,300 Cipla Ltd 589.05 0.80 1,725,900
Toshiba Corp 285.00 -1.38 20,573,000 Cairn India Ltd 0.00 0.00 -
Shiseido Co Ltd 6,925.00 3.48 2,246,700 Bosch Ltd 19,481.60 -0.35 12,716
Shionogi & Co Ltd 5,497.00 -0.33 1,269,800 Bharti Airtel Ltd 402.00 1.68 6,959,081
Tokyo Gas Co Ltd 2,846.50 0.07 1,041,300 Bharat Petroleum Corp Ltd 371.40 -1.37 12,426,086
Tokyo Electron Ltd 19,610.00 -2.05 1,589,400 Bharat Heavy Electricals 89.35 1.02 5,644,748
Panasonic Corp 1,581.50 0.89 5,858,300 Bank Of Baroda 143.60 -1.20 11,349,211
Fujitsu Ltd 661.80 -0.21 8,000,000 Bajaj Auto Ltd 2,852.70 -0.18 474,157
Central Japan Railway Co 20,795.00 -0.36 205,900 Axis Bank Ltd 505.70 -1.40 4,715,556
T&D Holdings Inc 1,738.00 2.12 2,252,500 Asian Paints Ltd 1,159.35 -0.48 758,169
Toyota Motor Corp 6,957.00 0.49 3,310,300 Ambuja Cements Ltd 246.60 -0.16 1,010,853
Kddi Corp 2,845.00 0.51 5,489,300 Adani Ports And Special Econ 381.15 -1.40 2,276,305
Nitto Denko Corp 8,401.00 -2.91 1,081,400 Acc Ltd 1,561.65 -0.62 296,965
 Gulf Times
6 Saturday, April 21, 2018

BUSINESS/LEISURE

Puerto Rico board sees route to recovery; residents have doubts

Bloomberg over years, only to be temporar- on December 5, data compiled by quire legislative approval.
Miami ily worsened by the September Bloomberg show. The turnaround plan, which
storm that left its electricity sys- Desmond Lachman, a resi- has the stated purpose of fixing
tem in tatters and caused thou- dent fellow at the American the island’s finances and reviv-

O
n Wednesday, the sec-
ond blackout in a week
hit Puerto Rico as the
decrepit power system went out
again. Hours later, the territory’s
federal oversight board said that
if all goes as planned, the gov-
ernment should soon start see-
ing budget surpluses big enough
to pay a sliver of its debt.
But residents like Marie Rivera
were doubtful — and a little an-
gry, too.
“It’s not fair to pay the bond-
holders, when the Puerto Rican
people are still suffering the
consequences of what Hurri-
cane Maria left us,” said Rivera,
a 38-year-old single mother and
hotel sales manager in San Juan.
“This is the type of situation
that leaves you wondering if it’s
worth making all these sacrific-
es, or if it’s better to just go and
move to the States.”
The federal board, created
by the US Congress, is trying to
chart Puerto Rico’s resurrection
from a financial crisis that built
sands of residents to leave.
By cutting spending, improv-
ing tax collections and taking
steps to encourage businesses,
the board is projecting that
Puerto Rico’s central govern-
ment can swing to a $6.7bn
surplus over the next six years
before accounting for debt pay-
ments. That’s about $400mn
more than a previous estimate
from Governor Ricardo Rossello,
whose steadily more sanguine
forecasts caused bond prices
to rally this year, even though
how much will be repaid will be
hashed out in bankruptcy court.
But the numbers are based
on the notion that Puerto Rico’s
growth prospects have actu-
ally improved since Hurricane
Maria slammed into the island as
a powerful Category 4, battering
infrastructure and hobbling its
already feeble economy. Not long
before the plan was released, the
island lost power yet again, the
latest in a series of episodes that
show it’s still a volatile place to
Enterprise Institute and former ing an economy that’s stuck in a
deputy director of the Interna- decade-long recession, will cut
tional Monetary Fund, said he’s spending for schools and munic-
concerned that some of the bil- ipalities and try to boost growth
lions in US taxpayer aid destined through labour reforms and re-
for the disaster recovery may ul- laxing certain regulations. Con-
timately end up in the hands of gress created the federal board
bondholders. in 2016 to address Puerto Rico’s
“My concern is that they’re debt crisis, as part of legislation
just going to use US taxpayer that also gave the island a path to
money to bailout the creditors, filing a form of bankruptcy.
but meantime the island is going Lachman, the former IMF of-
A street sign damaged from Hurricane Maria on a road in Canovanas, Puerto Rico. The federal board, to languish,” Lachman said. ficial, said he questioned the
created by the US Congress, is trying to chart Puerto Rico’s resurrection from a financial crisis that built The federal board plans to cer- logic of any plan that paints a
over years, only to be temporarily worsened by the September storm that left its electricity system in tify the multi-year fiscal plan on rosy economic picture when the
tatters and caused thousands of residents to leave. Thursday in San Juan. Among island is facing recurrent and ac-
other things, the plan calls for a celerating out-migration. The
live and do business, even seven power restoration efforts. Another on Wednesday, but earlier in- series of austerity measures, in- island has lost about 2% of its
months after the storm. blackout that occurred last week, creases in surplus estimates have cluding cutting pension benefits population every year for the
Hospitals and the main in- affecting more than 800,000 cli- sparked rallies in Puerto Rico se- by an average of 10% beginning past four, without counting the
ternational airport temporarily ents, was caused by a fallen tree. curities, causing some prices to in 2020 to help curb spending massive but largely unaccounted
ran on emergency power. A gen- The new fiscal projection double since December. and repair a retirement system for exodus after Maria.
erator fire filled the streets of a marks the latest boost to the es- General obligations with an that’s out of money. Governor “What kind of credibility can
trendy San Juan neighbourhood timates for the financial recov- 8% coupon and maturing in Rossello has baulked at reduc- they have if they make one pro-
with smoke, and hundreds of ery of the territory, which is set 2035, the island’s most actively- ing pensions, saying it would jection before the island gets hit
businesses were forced to close. to receive about $62bn of fed- traded security, changed hands place an undue burden on public by a once in a lifetime hurricane,
The outage was attributed to eral aid and insurance money to on Wednesday for an average workers and retirees. The board and then suddenly it improves
an excavator incident involving a help rebuild. The numbers were of 41.7 cents on the dollar, up maintains that there needs to be the situation?” said Lachman.
company subcontracted to help in released late in the trading day from a record-low 20.75 cents shared sacrifice, and any cuts re- “It just makes no sense at all.”

Sudoku Adam

Pooch Cafe

Sudoku is a puzzle Weekly’s Solutions

based on a 9x9 grid.
The grid is also
divided into nine (3x3)
boxes. You are given
a selection of values
and to complete the
puzzle, you must fill
the grid so that every
column, every row and
every 3x3 box contains
the digits 1 to 9 and
none is repeated.

Super Cryptic Clues

Garfield

ACROSS
1. Why, in particular, the gas workers are
digging a hole? (4,6)
6. Keep half, I note, of the yarn (4)
10. And speak angrily about what the
children got dirty in? (4-3)
11. The material is for a Miss Sharp (7)
12. Turned out again to have been cor-
rected (9)
13. The secret is almost out, but not in
England (5)
14. Remains to puzzle you (5)
15. As a means to an end, it’s suitable (9)
17. Write about a strange dream from
somewhere in Paris (5,4)
20. Coiled round and hurt (5)
21. Rows of instruments (5)
23. Gets some letters out? (9)
25. The charm of Dorothy’s sister Greta? (7)
26. Repeat the number (7)
27. A communication of importance? (4)
28. How the coot went for you? (4-6)
DOWN
1. Is the English gentleman on the outside the Bound And Gagged
stingy one? (5)
2. Batting, I’m sure, and confident (2,2,5)
3. Transport by air (4,10)
4. Containing a first rate performer: an enter-
tainer (7)
5. Have the silly dupe thrown out that’s con-
fessed (5,2)
7. Part in harmony, we’re told (5)
8. Happy to do the number with the man (9)
9. What the boxing gloves were bought for?
(5-4,5)
14. Unpleasant character whose father got
fired? (3,2,1,3)
16. Got even with (9)
18. The man took Marie off to some place in
Spain (7)
19. Guaranteed to secure a certain object (7)
22. It’s the smallest field, by the way (5)
24. Ante up or pass (5)

Weekly’s Solutions
Across: 1 Compacts; 5 Wastes; 10 Conversion
Table; 11 Leagues; 12 Respond; 13 Misspelt;
15 Nonce; 18 Ewers; 20 Casts off; 23 Cowslip;
25 Piccolo; 26 Air Conditioning; 27 Tsetse; 28
Intrigue.
Down: 1 Cockle; 2 Many a Time; 3 Avenues;
4 Tests; 6 Artisan; 7 Taboo; 8 Steadier; 9
Top Rates; 14 Escapade; 16 No Fooling; 17
Penchant; 19 Saloons; 21 Succour; 22 Tongue;
24 Worse; 25 Put on.
 Gulf Times
8 Saturday, April 21, 2018

BUSINESS
Lyft says every

Deutsche Bank’s Hammonds

ride will be
carbon neutral
Bloomberg
San Francisco

leaves as key exits continue this year to 27%. That makes Deutsche
Bloomberg
Frankfurt Bank the second-worst of the 42 com-
panies in the Bloomberg Europe Banks
and Financial Services Index, with only
Lyft Inc plans to spend mil-
lions of dollars a year to fund
projects that would offset the
pollution created by its driv-
ers. The move could help the
second-largest US ride-hailing
company draw environmentally
conscious customers from Uber
Technologies Inc.

T
he chaotic shakeup at Deutsche
Bank AG sent more aftershocks
through the bank’s top ranks as
its chief operating officer was ousted
and its head of investor relations quit.
Kim Hammonds, who reportedly
called Deutsche Bank “the most dys-
functional company” she’d ever worked
for, will leave “by mutual agreement”
at the annual general meeting on May
24, the Frankfurt-based lender said late
on Wednesday. Earlier, the bank an-
nounced that John Andrews, head of
investor relations for five years, is leav-
ing because of the recent management
changes.
Their exits come days after Christian
Sewing took over as chief executive of-
ficer from John Cryan amid a sustained
slump in the share price and questions
about the direction of Europe’s largest
investment bank. Sewing’s appoint-
ment was the third major change at the
top of Deutsche Bank in six years, and
followed weeks of intense speculation
about Cryan’s future while chairman
Paul Achleitner stayed silent. Marcus
Schenck, co-head of the securities
unit, also left as the company debates
how big a role it wants to play in global
investment banking.
“The way Achleitner replaced the
CEO was unprofessional and damaging
for everyone involved,” Klaus Nieding,
vice-president of shareholder advisory
DSW, said by phone before the depar-
ture of the COO was announced. “But
Hammond’s demise is of her own mak-
ing. She shouldn’t have made those
comments,” he said, referring to the
“dysfunctional” remarks made at an
internal event in March.
The bank may use Hammonds’s de-
parture to cut the size of its manage-
ment board and hand her responsibili-
ties to another board member, German
newspaper Handelsblatt reported on
Thursday. It suggested that chief ad-
state-rescued lender Banca Monte dei
Paschi di Siena SpA declining more.
Achleitner himself has come under
fire for his part in the upheaval. Board
members and investors have criticized
him for weeks of media leaks about his
hunt for a new CEO, his failure to find
credible external candidates and his
choice of Garth Ritchie as head of the
investment bank, people familiar with
the matter have said. The 61-year-old
faces a rough ride at Deutsche Bank’s
annual shareholder meeting in May
from investors who say he’s as much to
blame as Cryan for the lender’s woes.
Cryan was unable to restore revenue
growth after cutting risk, though he did
manage to settle billion-dollar legacy
misconduct cases and shore up capi-
tal. Last year, he raised €8bn ($9.9bn)
from investors in a share sale. This year,
he sold a minority stake in Deutsche
Bank’s DWS asset management busi-
ness in an IPO.
Investor relations chief Andrews,
who previously held the same post at
Citigroup Inc, Morgan Stanley and
Goldman Sachs Group Inc, played a key
role in both transactions. He will be re-
placed by James Rivett, currently head
of fixed-income investor relations, ac-
Kim Hammonds, COO of Deutsche Bank, looks on during a press conference in Frankfurt. Hammonds, who reportedly called cording to a memo to employees signed
Deutsche Bank “the most dysfunctional company” she’d ever worked for, will leave “by mutual agreement” at the annual by finance chief James von Moltke.
general meeting on May 24, the lender said. “John feels that this is the right
time to take this step with the leader-
ministrative officer Karl von Rohr, for Bafin said that there is “no legal re- standing was hurt further when reports ship changes recently announced,” von
who was promoted to co-president in quirement” for the bank to make IT a surfaced about her disparaging com- Moltke wrote. “John has helped the
the reshuffle earlier this month, is the board-level competence. “It is purely a ment. Hammonds hasn’t disowned the bank navigate many challenging and
likeliest candidate, without citing any business policy decision,” he said. remarks since they became public. important milestones.”
named sources. Hammonds had been tasked with “Kim Hammonds has been a breath In a separate development, at least
Handelsblatt also suggested that bringing the bank’s information tech- of fresh air, bringing an outsider’s per- four investment bankers at Deutsche
cutting a board position with spe- nology costs down and streamlining spective with deep experience in trans- Bank’s London office are leaving, peo-
cific and exclusive responsibility for the number of operating systems. But formational change,” Achleitner said ple familiar with the matter said on
IT could raise eyebrows at Germany’s concerns about slow progress have led in the release. The bank will appoint Wednesday. The departures include
banking regulator Bafin, given the to scepticism among supervisory board a new COO “in the near future,” after Guillaume Gnech, a director in equity
bank’s past problems with the issue. members and management that she’s consulting with regulators, it said. derivatives trading, Neal Naidoo, who
A spokesman for Deutsche Bank de- the right person, people familiar with Deutsche Bank was down 0.4% as worked in systematic trading, and Jon-
clined to comment, while a spokesman the matter said earlier this month. Her of 1:30pm in Frankfurt, bringing losses ny Edelman in hedge fund sales.
As part of the programme, Lyft
hired a company, called 3De-
grees, to oversee carbon-offset
investments. Those will include
efforts to reduce pollution in
auto manufacturing and forest
conservation.
“We feel immense responsibility
for the profound impact that
Lyft will have on our planet,”
founders Logan Green and
John Zimmer wrote in a blog
post published yesterday. “As
we continue to grow, we have
a greater responsibility to dedi-
cate material resources to our
vision and values.”
The move is sure to endear Lyft
to its urban base of riders and
drivers. The company positions
itself as a friendlier alternative to
Uber, a message that got a boost
during the final year of Travis
Kalanick’s tenure as Uber chief
executive officer. Lyft’s primary
US competitor saw hundreds of
thousands of customers delete
the Uber app from their phones
in protest last year.
But Uber has tried to burnish its
reputation since then. It replaced
Kalanick with the more affable
Dara Khosrowshahi. After years
of resisting, Uber copied Lyft by
embracing the most-demanded
feature from drivers: the ability
to add a tip within the app. Uber
has said its goal is to make it
easier to live without owning
a car and reduce congestion.
Last week, Uber acquired Jump
Bikes, a bicycle rental startup,
citing the potential to reduce
pollution. But Uber doesn’t have
a companywide sustainability
plan comparable to Lyft’s.
Lyft declined to estimate how
much it would spend on carbon
offsets but described it as a
“multi-million dollar invest-

Deutsche Bank’s $35bn error boosted Eurex’s coffers by 55%
Bloomberg Bloomberg News, was equivalent to 55% of the
London collateral held by Eurex Clearing on behalf of
the entire market. Almost every trading firm and
bank uses Eurex Clearing to protect their bets
Deutsche Bank AG’s accidental payment of €28bn on securities ranging from bund derivatives to
($35bn) to Eurex Clearing increased the collateral futures on the DAX and Euro Stoxx 50 equity
held by the world’s fourth-largest clearinghouse benchmarks.
by more than half. The clearinghouse, which like Deutsche Bank
Deutsche Bank’s payment, first reported by is based in Frankfurt, held cash and bonds
worth €51.3bn at the end of 2017, according
to a regulatory filing. Clearinghouses aren’t
responsible for monitoring collateral payments
made by their banks, and many member firms
supply more than the minimum collateral — or
initial margin as it’s also known — to cushion
themselves against changes in the value of their
derivatives.
Eurex Clearing, which is owned by Deutsche
Boerse, spotted the erroneous Deutsche Bank
transaction shortly after it was made and returned
€24bn within minutes, according to a person
familiar with the matter, who asked not to be
identified because the matter is private.
The remaining €4bn were returned after the long
Easter weekend, the person added.
Clearinghouses ensure that traders still get paid if
their counterparties default.
ment in the first year alone,”
according to the founders’ blog
post. “By committing significant
financial resources to these
offsets, we’re building into our
business a strong incentive to
pursue shared rides and the dis-
placement of gasoline-powered
vehicles,” they wrote.
“The more shared rides and
clean vehicles on the platform,
the fewer carbon offsets we will
need to purchase.”

Sensex falls; rupee weakens
past 66-mark against dollar
Bloomberg, Reuters
Mumbai
T
he benchmark indices BSE
Sensex and NSE’s Nifty 50
closed lower yesterday following
losses in global equities and hawkish
comments by the Reserve Bank of India
(RBI) in the monetary policy committee
minutes.
Asian markets also slipped, weighed
down by the technology stocks. Over-
night US stocks closed lower. Viral
Acharya, RBI deputy governor, said
in the minutes that he is likely to shift
decisively to vote for a beginning of
“withdrawal of accommodation” at the
next MPC meeting in June.
The BSE Sensex closed lower by 11.71
points, or 0.03%, to 34,365.07, while
the Nifty 50 edged down 1.25 points,
or 0.01%, to close at 10,564.05. Among
the sectoral indices on the BSE, IT led
gains by rising 4.80% followed by teck
3.89%, while utilities, realty, bankex
and power fell up to 1.22%.
The BSE MidCap was down 0.44%,
while SmallCap gained 0.02%. TCS,
Infosys, Coal India and Wipro were
among the top gainers, whereas Yes
Bank, Tata Steel, ICICI Bank and SBI
were among the major losers.
Meanwhile the Indian rupee yester-
day weakened past 66-mark to hit an
over thirteen-month low against the
dollar, while the 10-year bond prices
climbed 6 basis points as probability
of rate hike increased after the central
bank’s surprised hawkish minutes.
This rupee declined for the fifth
consecutive session, while the 10-year
bond yield surged nearly 55 basis points
since last two weeks to hit an over two-
year high.
The home currency closed at 66.11
against US dollar — a level last seen on
March 10, 2017, down 0.47% from its
Thursday’s close of 65.66. The rupee
Tencent-backed Meilishuo is
said to seek IPO at $4bn value
Bloomberg
Hong Kong
Yet another Chinese technology company
is headed for an initial public offering. Meil-
ishuo, the online fashion retailer backed by
Tencent Holdings, is in talks with several
investment banks about a US initial public
offering that could value the startup at
about $4bn, according to people familiar
with the matter. The women-focused
online retailer hosted a bake-off to discuss
IPO prospects with potential advisors
and underwriters, the people said, asking
not to be identified talking about private
negotiations.
Meilishuo, which merged with rival
Mogujie in 2016 to form a company with
$3bn in sales, was said to have been
valued at $3bn at the time of that deal. The
company, whose name means “Beauty
Talk,” is one of the more popular fashion
and cosmetics retailers online, a niche it’s
clung to despite the dominance of Alibaba
Group Holding and JD.com Inc. Meilishuo’s
envisioned $4bn valuation is an initial tar-
get and could change if a deal proceeds,
the people said.
It’s one in a growing wave of Chinese
technology companies looking to sell
shares to the public. Smartphone maker
Xiaomi Corp is seeking a valuation of as
Asia markets drop in line with Wall St as tech firms take a hit
AFP
Hong Kong
A
sian markets mostly fell yes-
terday as investors struggled
to maintain the previous day’s
positive momentum following losses
on Wall Street, with technology firms
tracking a sharp fall in Apple.
While worries about the Syr-
ian crisis and a potential China-US
trade war keep dealers on edge, fo-
cus has for now moved to the cor-
porate arena as the earnings season
gets into full swing.
All three main Wall Street indexes
fell on Thursday after a mixed bag of
business reports with market giant
Procter & Gamble posting lacklustre
results, while rising US Treasury yields
also spooked investors worried about
higher interest rates.
But the big news was a near-3%
plunge in Apple, which came after ma-
jor chip supplier Taiwan Semiconduc-
tor Manufacturing Co (TSMC) forecast
sales for the present quarter would be
about $1bn down on analyst forecasts.
The rupee closed at 66.11 against the US dollar yesterday, a level last seen on March 10, 2017, down 0.47% from its Thursday’s close of 65.66
opened at 66.08 a dollar and touched a
low of 66.11.
However, the 10-year bond yield
trimmed some of its gains and but
managed to close higher from its pre-
vious close. The 10-year government
bond yield closed at 7.686%, up 6 ba-
sis points, from its previous close of
7.63%. Bond yields and prices move in
opposite directions.
“The Reserve Bank of India’s policy
minutes are increasingly assuming more
importance than the policy statement
and April proved to be another such
month. Majority of the members high-
lighted upside risks to inflation and con-
much as $100bn in a much-anticipated
offering, people familiar with the matter
have said, while Meituan Dianping, a Chi-
nese food review and delivery giant also
backed by Tencent, has begun discussions
about a Hong Kong IPO at a valuation of at
least $60bn.
“Tencent wants to develop e-commerce
via its partners, so Meilishuo could get a
lot of resources and help,” said Li Yujie, an
analyst with RHB Research Institute Sdn
in Hong Kong. “It still depends on how the
overall market performs, but e-commerce
sector-wise it would be a good year to
fetch a good valuation.”
Meilishuo, which didn’t respond to
requests for comment, was said to have
considered a US listing as early as two
years ago. Most of China’s largest tech
Corps have picked New York for their de-
buts, seeking the wide investor base and
higher international profile that an Ameri-
can listing confers. Beijing however is now
encouraging many of those same firms to
also list shares on Chinese exchanges.
Founded in 2009, Meilishuo runs an
online marketplace selling clothes, shoes
and handbags. As of 2016, it had about
15,000 merchants on its website and a
mobile application that had been down-
loaded 100mn times. That year, it merged
with Mogujie, founded in 2011 with about
130mn registered users.
This fuelled concerns that the
smartphone sector, a massive driver
of revenue for tech firms, including
Apple and Samsung, was beginning
to wane.
The tech-rich Nasdaq lost 0.8% in
New York.
Asia-listed Apple suppliers and oth-
er tech firms fell.
In Taipei, market heavyweight
TSMC plunged more than 6% and Fox-
conn lost 1.2%.
Alps shed 1.8% in Tokyo, while
Seoul-listed LG Display was off 1.2%.
South Korean titan Samsung was more
than 2% lower, while AAC Technolo-
gies sank 7.3% in Hong Kong.
On broader markets, Taipei was off
1.8% and Seoul was 0.4% lower, while
Shanghai slipped 1.5%.
Tokyo ended 0.1% down, while Sin-
gapore shed 0.6% and Sydney was
0.2% off. There were also losses in Ja-
karta and Wellington.
Hong Kong fell 0.9% with real es-
tate firms also hit by worries the city’s
moves to support the local dollar will
lift interest rates and put pressure on
the housing market.
fidence on growth prospects. This raises
the odds that the policy stance might
shift from neutral to hawkish, in June.
Recent rupee underperformance and
rising 10 year bond yields add to the cen-
tral bank’s concerns, alongside a sharp
rise in global, particularly, US” said Ra-
dhika Rao economist at DBS Bank.
According to RBI minutes on Thurs-
day, Viral Acharya, RBI deputy gover-
nor, said he is likely to shift decisively
to vote for a beginning of “withdrawal
of accommodation” at the next Mon-
etary Policy Committee (MPC) meeting
in June. This was the strongest guid-
ance given by a MPC member ever.
EM stocks snap winning streak
Reuters
London
E
merging markets ended the
week on a sour note with tech
stocks taking a tumble fol-
lowing a warning over smartphone
demand while steadily climbing US
yields and a stronger dollar weighed
on currencies.
MSCI’s emerging market benchmark
snapped a three day winning streak to
fall 1%, dragged lower by a more than
2% drop in emerging IT stocks.
The losses came in the wake of the
world’s largest contract chipmaker
Taiwan Semiconductor Manufac-
turing cutting its revenue target to
the low end of forecasts and blam-
ing softer demand for smartphones,
which sent its shares tumbling more
than 6%.
Meanwhile emerging currencies
also suffered as the dollar index trad-
ed at its highest in nearly two weeks,
with rising inflation expectations
lifting US Treasury yields which had
climbed steadily over the week and
hovered near a one-month high hit
on Thursday.
“The important thing to note is the
rise in US long term yields again after
the yield curve flattening concerns
But Manila rose 0.8%, recover-
ing some of Thursday’s sharp losses,
though the index is down 10% so far
this year on worries about inflation,
a weak currency and fears the central
bank may need to lift interest rates
sharply.
Energy firms dipped slightly fol-
lowing Thursday’s oil-fuelled surge
after reports said Opec officials meet-
ing in Saudi Arabia suggested supplies
looked like they were coming into line
with demand.
That led to worries about an Opec-
Russia output cap deal that has sup-
ported prices in recent years.
However, crude remains at more
than three-year highs, supported by
continued Middle East tensions and
signs of healthy US demand.
“Saudi Arabia with Opec’s sup-
port is looking to draw a new line in
the sand for oil prices and added an-
other level of intrigue to the already
bullish narrative,” said Stephen
Innes, head of Asia-Pacific trading
at OANDA.
But he added: “The civil war in
Syria and threat of Yemeni rebels
Earlier, RBI executive director Michael
Patra voted for a 25 basis point hike in
the repo rate at the February and April
meetings.
“The minutes of the MPC’s meeting
have a distinctly hawkish tinge as com-
pared to our reading of the statement
itself.
While incoming data and policy de-
cisions related to factors such as mini-
mum support prices, excise on fuel and
expenditure announcement remain
critical, today’s minutes suggest that a
back-ended rate hike in 2018 remains a
possibility if headline inflation exceeds
the trajectory set out by the MPC”, said
have dominated markets for some
time,” Inan Demir, senior emerging
economist, Nomura International.
“This is a key pressure point for
emerging markets with large exter-
nal financing needs, some of these
markets, and I’m thinking of Turkey
especially here, are also vulnerable to
the rise in oil prices.”
Russia’s rouble chalked up some of
the biggest losses of the day, weaken-
ing 0.8% after the Finance Ministry
resumed forex purchases to replen-
targeting the region’s top oil ex-
porter Saudi Arabia with rockets
has traders paying the geopolitical
risk premium, which should keep
downticks in check.”
On currency markets, the pound
continued its fall against the dollar af-
ter Bank of England boss Mark Carney
tempered expectations of an interest
rate hike next month following a sur-
prise drop in March inflation.
Sterling had rallied at the start of the
week to its highest post-Brexit vote
level on bets that British prices had
continued to rise last month and rates
would follow suit.
“Carney walked back all the
hawkishness suggesting interest
rates will go up over the next few
years but gave no specific timeline
which caused anyone who was bank-
ing on a May rate hike to head for the
exits,” Innes said.
In Tokyo, the Nikkei 225 closed
down 0.1% to 22,162.24 points; Hong
Kong — Hang Seng ended down
0.9% to 30,418.33 points and Shang-
hai — Composite closed down 1.5% to
3,071.54 points yesterday.
BUSINESS
Aditi Nayar principal economist at
ICRA. The remaining four members in-
cluding RBI governor continue to wait
for more data for the future course of
interest rates.
Both, rupee and bonds were already
under pressure following an increase
in crude oil prices ,which may lead to
higher inflation and fiscal slippage, ac-
cording to analysts.
Slowing inflows into local and
debt markets from foreign investors
also added pressure. Since start of
April, foreign investors have sold a
combined of $500mn in local equity
and debt market.
ish state reserves. But South Africa’s
rand and Korea’s won eased around
0.3%. However, thanks to gains ear-
lier in the week all were on track for
weekly gains.
Meanwhile Mexico’s peso, treading
water on the day, was on track to rack
up a 2% loss over the week — the big-
gest such fall since December.
Mexican markets were spooked
by the strong performance in opin-
ion polls by leftist Andres Manuel
Lopez Obrador.
Investors follow financial information at a securities brokerage in Shanghai. The
Composite index closed down 1.5% to 3,071.54 points yesterday.
Gulf Times
Saturday, April 21, 2018 9
India is said
to tell US
it doesn’t
manipulate
currency
Bloomberg
New Delhi
India has told the US it
shouldn’t be considered a
potential currency manipula-
tor because the central bank’s
interventions in the foreign
exchange market aren’t tar-
geted at boosting exports, said
government officials.
India reached out to the US to
explain that the $2.3tn economy
runs a current account deficit
and needs to maintain foreign
exchange reserves, the officials
said asking not to be identified
citing rules.
The Treasury added India
to its monitoring list last week
along with China, Japan, South
Korea, Germany and Switzer-
land.
India has built up foreign
exchange reserves of $425bn –
just enough to cover about 10
months of imports. But the US
doesn’t see this as necessary,
according to the Treasury
department’s report on foreign
exchange policies of major trad-
ing partners.
Increase in crude imports
from the US will address con-
cerns on trade deficit, said one
of the officials, adding that India
is not escalating the matter at
the moment because the list
is put out mechanically and
chances of India being named a
manipulator are low.
Raveesh Kumar, a spokes-
man with India’s external affairs
ministry, could not immediately
respond.
The Treasury department is
bound by law to report to Con-
gress twice a year on whether
US’s major trading partners
are gaming their currencies.
It hasn’t labelled a country a
manipulator in more than two
decades.
The US has three criteria to
name a trading partner as a
currency manipulator: those
that have a trade surplus of
$20bn or more, a foreign
exchange intervention of at
least 2% of the gross domestic
product in the past year, and a
current account surplus of at
least 3% of GDP.
India meets the first two
criteria. It runs a trade surplus
of about $28bn with the US,
and net purchases of foreign
exchange in 2017 were equiva-
lent to 2.2% of the GDP. But it’s
far from meeting the third as
the South Asian nation runs a
current-account gap – 2% of
GDP as of October-December
quarter.
While the US is “strongly
concerned” about China’s trade
balance, which meets all three
criteria, it still hasn’t named it a
manipulator.
Taiwan and Thailand,
which run significant current
account surpluses and inter-
vened in currency markets,
didn’t make it to the list either.
“The inclusion of India, and
the exclusion of Taiwan,
thus highlights the problems
that arise from the mechani-
cal application of the three
criteria,” said Brad Setser, a
senior fellow at the US Coun-
cil on Foreign Relations and
a former Treasury official. “I
think it was a mistake.”
 Gulf Times
10 Saturday, April 21, 2018

BUSINESS
Four Harvard students jump on the crypto hedge-fund bandwagon
Bloomberg vidual investors have long dabbled in Capital showed that 4% of Millenni- 300 students have shown an interest. help new fund managers raise capital, at from Syria 22 years ago to continue
Portland cryptocurrencies, funds became in- als – people 18 to 34 years old – have Hamid won’t say how much she made Harvard this month. Setting up a fund their medical education. She graduat-
terested in the last few years. About owned bitcoin, twice the rate of the on crypto, but a friend was impressed can involve filing with the Securities ed valedictorian from a Houston public
226 have opened so far, most of them general population. And 16% of Mil- enough with the returns to spur her to and Exchange Commission, as well as high school before heading to Massa-

I
n the 1970s, Bill Gates and Steve
Ballmer revolutionised operating
system software. Thirty years later,
Mark Zuckerberg helped pioneer social
networking. So what’s the latest gen-
eration of Harvard tech entrepreneurs
up to? Looking to cash in on crypto-
currency, of course. Bushra Hamid,
the 19-year-old daughter of Syrian
immigrants, has teamed up with three
schoolmates to form Plympton Capi-
tal, a hedge fund for investing in dig-
ital currencies. Hamid says they aim
to launch in six to eight weeks, start-
ing with $1mn. Plympton, named for
a street in Cambridge, Massachusetts,
has already raised $700,000 from
friends and family.
“We don’t necessarily know a lot,
but they have full trust in us,” Hamid
said. While many tech-savvy indi-
within the last year, managing as much
as $5bn in capital, according to Auton-
omous Research.
Bitcoin, the bellwether for the entire
market, has retreated from last year’s
heights, sending the crypto fund re-
turns down 48% in the first quarter,
according to the Eurekahedge Crypto-
Currency Hedge Fund Index.
Many funds aren’t expected to sur-
vive for long, and some have already
folded. In spite of those setbacks, more
funds have opened, some helmed by
people in their 20s, according to Remy
Astie, chief executive officer of Cita-
delle, which helps set them up. Astie
himself is 24.
The Plympton group is banking on
the youth movement. A recent online
survey of about 2,000 adults con-
ducted by Harris Poll for Blockchain
lennials said they plan to buy bitcoin in
the next five years.
“Some people might see our age, and
see this is a new growing space that’s
largely driven by the Millennials,” Jun-
aid Zubair, another Plympton founder,
said. “That allows for a high sense of
liability but also passion and interest.
There we might have an advantage.”
Plympton’s plan is to deploy techni-
cal analysis, arbitrage opportunities,
portfolio optimisation, and machine
learning to find the right investments,
Zubair said. He declined to provide
more specifics.
The quartet began meeting to dis-
cuss cryptocurrencies last year, when
they each invested in coins independ-
ently. Hamid said that last fall she
started the Harvard Undergraduate
Blockchain Group, in which more than
action.
“He was instantly, instantly in-
trigued,” she said. “He said, ‘Start
something and I’ll invest.’ I realised,
‘Why not?” To get started, Hamid
reached out to attorney John Lore, who
says he has helped set up more than 30
crypto hedge funds.
“Emerging cryptocurrency funds
see this an opportunistic time to start
up the infrastructure to set up a fund,”
according to Lore, who said he gets
about six or eight inquiries daily from
aspiring crypto fund managers. “What
that means is that at least fund manag-
ers are very bullish on the long-term
aspects of cryptocurrency in varied in-
vestment strategies.”
Lore is working with Hamid pro bono.
The two also plan to launch the Global
Center for Investment Fund Studies, to
finding a fund administrator and, po-
tentially, a custodian.
It costs a lot to run a fund, so most
need to be targeting $25mn to $50mn,
Lex Sokolin, global director of fintech
strategy at Autonomous Research, said
in an e-mail. Still, he said, Plympton’s
founders may enjoy a “generational
advantage.”
“If crypto is a Millennial or Gen Z
game, then knowing how to be foolish
in the same ways as everyone else is
valuable – it allows you to benefit from
reflexivity in the markets,” he said. At
the same time, their inexperience may
hurt them, he added.
“If it’s not grounded in reality and
compliance, the project will get eaten
up by the increasingly sophisticated
competition,” Sokolin said.
Hamid’s parents moved to the US
chusetts for college, where she studies
psychology, as does Zubair, a senior.
While they aren’t business majors,
the four do have some relevant expe-
rience. Zubair interned for an asset
manager in Chile and a bank in New
York. Scott Sussex, another founder,
is a junior in applied math, and Omar
Sorour is a senior in neurobiology and
economics. Unlike Gates and Zuck-
erberg, the seniors plan to graduate.
Then they can work on Plympton full-
time, Hamid said.
“Balancing running a fund and
school is challenging, but part of the
reason we have four co-founders,
that’s allowed us to get where we have
given time constraints with school,”
Sussex said in a phone interview. “It’s
meetings that start at dinner at go into
the evenings, a lot of the weekends.”

VIX rigging talk erupts

on Wall Street after
Jordan: Allaying fears over currency.

Jordan sees no need

another wild swing
Bloomberg

for SNB policy shift New York

despite lower franc T

Bloomberg terday, having traded as weak as
London 1.20055 earlier in the day. At the
European Central Bank, policy
makers still have to start de-
he Cboe Volatility Index is how
Wall Street measures anxiety.
Lately it’s the gauge’s own plumb-
ing that’s making people nervous.
It’s a recurrent claim – the VIX is
rigged. It got a fresh airing on Wednes-
day, when the index swung wildly just as
derivatives on it were expiring billions of
dollars are earned or lost as VIX futures

T
he Swiss National Bank
(SNB) is “not in a hurry”
to adjust policy despite
the franc touching a milestone
low as the situation remains
delicate, president Thomas Jor-
dan said.
“There’s no need to do any-
thing regarding monetary policy
at this moment,” he said in an
interview with Bloomberg Tel-
evision on Thursday in Wash-
ington. Jordan spoke just hours
after the franc broke through the
1.20-per-euro mark for the first
time since early 2015, when the
central bank gave up the ceiling
it had set at that level.
He said that although the
franc’s drop goes in the “right
direction” the currency is still
considered a haven and the
situation “fragile” and prone to
change from one day to another.
“So we remain very prudent.”
The SNB is using a two-pillar
policy of negative interest rates
and a pledge to intervene in cur-
rency markets, if necessary, to
keep the franc in check. Its de-
posit rate is set at minus 0.75%
to maintain the spread with the
neighbouring euro area.
“We are convinced that the
current monetary policy is still
necessary,” he said. With infla-
tion still low, the central bank
will continue with its policy “as
it is today.”
The franc was little changed at
1.19953 per euro in Zurich yes-
bating the future path of asset
purchases, which are currently
scheduled to end in September.
There’s also the matter of sub-
zero interest rates. Once they
start to rise, that’ll probably
open the door for SNB action.
Although he declined to com-
ment on ECB policy, Jordan said
major central banks around the
world going back to “normal” is
a positive sign and would “help
smaller economies and give
them more room to manoeuvre
in the future.”
Bloomberg’s foreign-ex-
change surveys back up the
Swiss central bank president’s
cautious stance: the median es-
timate for euro-franc shows a
level of 1.18 per euro at the end
of 2018.
“Simply the fact that they’re
at 1.20 shouldn’t be enough,
even though the level is of course
psychologically interesting,”
said Credit Suisse economist
Claude Maurer. “Since the next
action of the ECB isn’t that far
off, the SNB will wait until then
to raise rates. Unless of course
the franc slid a lot more.”
A monthly poll of economists
– conducted before the 1.20
milestone was reached – shows
they anticipate the SNB will keep
its deposit rate at the current level
for the first nine months of 2019,
before raising it by 25 basis points
in the final quarter. That would be
the first increase since 2007.
settle. The concern is that owners of
those wagers are willing to spend a few
million to make them pay off.
The suspicions are only that, suspi-
cions. Volatility markets are too complex
for easy conclusions to be drawn, and
reasonable explanations have been of-
fered for the patterns. But strange-look-
ing outcomes have happened enough on
VIX settlement day that the debate keeps
being revived.
Cboe Global Markets Inc declined to
comment. Last month, Cboe CEO Ed
Tilly said at a conference that “the integ-
rity of our VIX products and markets is
paramount. And, if our regulatory team
were to uncover any manipulation, it
would be rooted out, swiftly and deci-
sively. was sailing along without incident until options that were tied to a 50% drop in dence because of a study published
Evidence the VIX is anything less than about 9am in New York, when it spiked the S&P 500. last year by University of Texas re-
a pure readout on trader nerves would as much as 11% in about an hour’s time. A trade of 13,923 May puts on the S&P searchers who said they saw evidence
raise thorny questions for its overseers, The jump coincided with a Cboe auction 500, with a strike price of 1200, took the process had been gamed, possibly
who have succeeded in making it a cen- in which a monthly settlement value is place just as markets opened at 9:30am. by people holding derivatives.
tral piece of Wall Street wiring. Its abil- set for the gauge, one that is critical to Before Wednesday, the option was ac- It’s a theory the Cboe has denied in
ity to turn stomachs was on display in owners of some of the most popular fu- tive only on five sessions in the past two the past, saying the trading patterns
February’s stock correction, whose worst tures in the country. months, with daily volume never ex- observed by the authors, John Griffin
moments came when the VIX doubled Both the settlement price and the ceeding 75 contracts. and Amin Shams, have explanations
and wiped out bets on calm. high-water mark for the VIX index oc- “This feels odd. I don’t think this is a that require no illicit motive. Sup-
“You have people watching and using curred more than 10% above Tuesday’s coincidence,” Chintawongvanich said. posedly telltale volume spikes in S&P
it as a barometer for all sorts of trad- close – lucky, if you were betting on a “With all the concern about the pos- 500 contracts at auction are a natural
ing decisions,” Steve Sosnick, chief op- gain. And people were. Large speculators sible VIX manipulation in February and result of traders replacing VIX futures
tions strategist at Interactive Brokers in hold record net-long VIX futures posi- then this happening today, it’s possible with options exposure, not people
Greenwich, Connecticut, said by phone. tions, according to the latest data from that the regulators would look at it more trying to steer it.
“People take clues from what it’s doing the Commodity Futures Trading Com- closely. It appears to me that the instru- “You can always find people that argue
as to what the market’s psychology is mission. ment is vulnerable to people who want to that this is just a normal thing to happen
out there. But when the settlement time Pravit Chintawongvanich, head of de- push it up.” – market makers need to unload their
comes around, it can take on a life of its rivatives strategy at Macro Risk Advisors, All kinds of claims have surfaced inventory, and they happened to have
own.” saw evidence the VIX was pushed high- about the VIX’s vulnerability and most too many far downside options this time
Wednesday morning’s events were er intentionally. Among other things, aren’t taken seriously by Wall Street around,” Chintawongvanich said. “These
sure to raise eyebrows. The VIX, which roughly $2.1mn was spent in the runup to pros. The ones focusing on the set- are all legitimate explanations. We’ll
derives its price from S&P 500 options, the settlement on “extremely irrelevant” tlement auction tend to get more cre- probably never know who did it.”

Sanctions fever grips nickel as market rethinks Russia risk

By Andy Home
London
Sanctions fever has spread to nickel.
With Russian aluminium producer Rusal
imploding in the wake of US sanctions
against its oligarch owner Oleg Deripaska,
attention is now turning to the status of
another Russian industrial powerhouse,
Norilsk Nickel.
Deripaska is a 27.8% shareholder in No-
rilsk, while the oligarch behind the world’s
number two nickel producer, Vladimir
Potanin, is himself on a US Treasury
Department list of Russians deemed to
be close to the Kremlin. Fears that Norilsk
might follow Rusal down the US sanctions
path have sent London nickel prices on an
extraordinary rollercoaster ride.
But this was a market primed for an ex-
plosive breakout, with all sorts of technical
drivers kicking in once it started rallying.
Right now there is no imminent danger
of Norilsk being pulled into the Rusal sanc-
tions and the speculative froth is already
blowing off an overheated market. But
nickel’s shake, rattle and roll is a sign of
changing times. Industrial metal markets
have spent the past decade tracking the
shifting policies of just one country, China.
The eruption of US policy risk and
global geopolitical risk injects something
completely new and different into market
calculations. As nickel shows, pricing this
changed landscape is still very much a
chaotic work in progress.
There is no compelling evidence that
the US sanctions on Deripaska and his alu-
minium empire are going to affect Norilsk.
Deripaska’s stake is below the 50%
threshold over which sanctions can leap
from targeted entity to secondary entity.
It is also worth remembering that
Deripaska’s relations with Potanin are dis-
tinctly frosty. The two oligarchs have been
locked in an acrimonious stand-off ever
since Deripaska scooped up his holding in
Norilsk during the global financial crisis.
And while Potanin does appear on the
Treasury’s “Putin List”, released in Janu-
ary this year, so do 209 other Russians.
Only seven were designated in the April
6 sanctions and the US government has
signalled it is not planning any imminent
new sanctions. Norilsk is also a different
beast from Rusal. As well as looming large
in global nickel production terms, it is also
big supplier of copper and cobalt. Most
importantly, however, it is the world’s No.1
supplier of palladium to automotive manu-
facturers who use the metal in catalytic
converters. That includes US auto compa-
nies. North American and Latin American
customers accounted for $807mn, or 34%,
of Norilsk’s palladium sales in 2016.
Hitting Norilsk with the sort of draco-
nian sanctions unleashed on Rusal risks
massive collateral damage.
The United States has only one major
palladium mine, Stillwater in Montana,
which would be unable to full any
sanctions-induced supply gap.
The Rusal sanctions, by contrast, dove-
tail with the US administration’s aluminium
tariffs, aimed at encouraging the restart
of idled production capacity. Such details
have been lost in the speculative heat of
the past couple of days.
Fanning the flames further were
rumours that the London Metal Exchange
(LME) was delisting Norilsk brands. How-
ever, unlike the emergency suspension of
Rusal brands, this is old news, originally
announced in August 2016.
The brands are being removed because
Norilsk has decommissioned the plant
that produced them. Most of the Russian
metal in LME warehouses has long since
set sail for China.
„ Andy Home is a columnist for Reuters.
The views expressed are those of the author.
 Gulf Times
Saturday, April 21, 2018 11

BUSINESS
Ukraine Eurobond
Russia is all set to grab sale possible before
reaching deal with IMF

economic foothold in Bloomberg

Washington

U
kraine may tap inter-
national markets sev-
to complete negotiations on
the gas reform and that’s it.”
Ukraine may meet the IMF’s
requirements by “early sum-
mer,” he said. Some investors
are more sceptical. The yield

reluctant EU member
eral times this year to
raise $2bn as the government
prepares to repay foreign debt
of almost twice that amount.
The eastern European coun-
try is seeking to restore the
flow of financial aid from the
Bloomberg has so far been limited to hotels, International Monetary Fund
Zagreb gas stations owned by Lukoil, and will place “the major-
and stakes in a handful of other ity” of bonds after it reaches a
companies. staff-level agreement with the
Ukraine’s dollar-denominated
bond due 2032 rose as much as
13 basis points to 8.14% yester-
day, within a basis point of the
highest level since the note was
sold last year. Servicing foreign
debt will remain a serious issue
for years to come, Prime Min-
ister Volodymyr Hroisman told
lawmakers yesterday.
“The question is can piece-

T
wo Russian banks are on
the verge of taking a sub-
stantial equity stake of
Croatia’s biggest retailer, ex-
panding Moscow’s reach in a
corner of the European Union
that has for years tried to fend
off Russian investment.
State-owned Sberbank and
VTB Group are set to convert
claims of about €1.4bn ($1.7bn) in
debt to equity in Agrokor after it
tumbled into insolvency last year
amid allegations of accounting
fraud. The deal was made pos-
sible after Sberbank dropped a
raft of lawsuits in a bruising bat-
tle to have its claims recognised.
The stake, which has yet to be
determined, will dwarf Russian
investment into Croatia since its
independence from Yugoslavia.
It will also give Moscow a new
avenue to expand its clout in a re-
gion that, even before the fall of
communism, has tried to escape
its orbit for higher living standards
and a more democratic system.
Sberbank has insisted that it’s sim-
ply protecting its investment, say-
ing it’s not in the business of taking
over failed companies. Russia’s
ambassador to Zagreb, however,
didn’t miss the opportunity to note
the political significance.
“I wonder why your Western
Zagreb also declined to take
part in the Moscow-led South
Stream gas pipeline and has long
shunned interest from Russian
gas companies in refiner INA In-
dustrija Nafte. Robert Kohorst,
the US ambassador to Croatia,
said in February it would be a
“mistake” to sell INA to a Rus-
sian company, criticising what
he called Russia’s “disruptive
role” in the region.
A spokesman for Sberbank
declined to comment. Last year,
the lender distanced itself from
comments from Azimov that
Russian assistance was contin-
gent on cooperation with Mos-
cow. Sberbank chief executive
officer Herman Gref said at the
time that the bank requested
that the Foreign Ministry clarify
The headquarters of Sberbank in Moscow. Sberbank and VTB Group are set to convert claims of about $1.7bn Azimov’s statement and was told
in debt to equity in Agrokor after it tumbled into insolvency last year amid allegations of accounting fraud. he was expressing his personal
opinion. The Russian banks en-
friends, your strategic partners, the Cold War, each move by Rus- expansion just as President tered the scene when Agrokor
didn’t come to you to help with sian companies to increase in- Vladimir Putin’s government owner Ivica Todoric needed to
Agrokor,” Anvar Azimov told re- vestment, military or other ties annexed Crimea from Ukraine. borrow to purchase the Sloveni-
porters on Tuesday. “Russia has in the EU’s eastern members has Backed by the US in its war an rival chain Mercator Poslovni
once again proved that Russia is drawn close scrutiny from allies. for independence, Croatia is a Sistem in 2014. Todoric, who
a reliable friend of Croatia, and Hungary’s government, which strong supporter of EU sanc- had built Agrokor into the larg-
whatever we should do here, we has clashed with the EU over tions against Russia. And while est company in the Balkans, was
should do to promote the stabil- democratic values, drew criti- Russian investment has poured charged in October with fraud
ity of your country.” cism in 2014 when it awarded into neighbouring Serbia and the after an audit found hundreds of
With relations between Russia Russia’s Rosatom Corp the con- ethnic-Serb dominated part of millions of dollars of hidden li-
and the West at their worst since tract for a €12.5bn nuclear plant Bosnia Herzegovina, in Croatia it abilities. He denies wrongdoing.
lender, according to finance
minister Oleksandr Danylyuk.
But the government may test
the markets before the deal, he
said in an interview.
“We closely monitor the
situation, market conditions,
in order to make maybe the
first issue a bit earlier,” Dany-
lyuk, 42, said in Washington,
where he’s attending the spring
meetings of the IMF and the
World Bank. “But obviously
the majority of the issue will
be done after we get staff level
agreement with the IMF.”
After almost a year of de-
lays, Ukraine is still struggling
to unlock the remainder of its
$17.5bn bailout. To get the next
tranche of $1.9bn, the former
Soviet republic needs to set up
a court to deal with crooked
officials and raise natural gas
prices for households. Both is-
sues are complicated by presi-
dential and parliamentary
elections that are set for 2019.
“We know what needs to
be done - the anti-corruption
court,” Danylyuk said. I’m very
positive about this law, I think
the conditions are there for
this law to be passed but it’s
difficult to predict how long it
will take. And then we’ll have
meal Eurobond issuance, plus
the local market opening up,
get Ukraine through this year
without the IMF,” said Tim
Ash, a strategist at BlueBay
Asset Management in London.
“‘Don’t know’ is the answer -
it likely depends how forgiving
global markets are in the hunt
for yield.”
Ukraine sold $3bn of Eu-
robonds in September, its first
placement since Russia an-
nexed Crimea and a Kremlin-
backed insurgency erupted
in the country’s easternmost
regions. A portion of the pro-
ceeds was used to fund the
repurchase of $1.2bn of bonds
maturing in 2019 and $415mn
of notes due in 2020.
The government may buy
back more debt due in those
years, according to Danylyuk.
“That part of the curve is a
priority for us,” as opposed to
the repurchase of warrants is-
sued to creditors in the coun-
try’s 2015 restructuring.
The warrants, which give
investors cash when economic
output meets certain crite-
ria, have more than doubled
in value in the last year as in-
vestors see growth outpacing
projections.

CORPORATE RESULTS

GE profit tops estimates as cost-cutting kicks in

General Electric Co posted quarterly results that
topped expectations yesterday, as earnings from
aviation, healthcare and transportation offset weak
power and oil-and-gas profits, sending shares
sharply higher.
GE affirmed its forecast for 2018 earnings and
cash flow, and said it expects to book as much as
$10bn in proceeds from divesting industrial assets
this year. Those comments eased concern that GE
would post poor results.
GE’s profit reflected 7% revenue growth and vigor-
ous cost cutting. Revenue rose in aviation, oil-and-
gas and healthcare, offsetting declines in power,
transportation, lighting and renewable energy.
GE sliced $1bn in costs, including $800mn in indus-
trial structural costs. GE’s shares were up 4.8% to
$14.66 after rising 2.4% on Thursday.
The stock has lost more than half its value in the
past last year. But GE also took a $1.5bn reserve
charge for potential costs associated with its
discontinued WMC mortgage business, formerly
part GE Capital.
The US Department of Justice has been investigat-
ing the activities of GE’s former mortgage unit dur-
ing the subprime mortgage crisis, since 2015.
GE said settlement discussions with the DOJ
in March and analysis of other banks’ reserves
prompted it to take the charge, but it sees limited
impact to results. “We do not expect this to change
our view on GE Capital with regards to cash and
liquidity,” GE chief financial officer Jamie Miller said
on a conference call with analysts. Excluding adjust-
ments, GE earned $369mn, or 4 cents a share, on
revenue of $28.7bn.
Baker Hughes
General Electric Co’s Baker Hughes posted quarter-
ly profit that beat Wall Street estimates yesterday as
improving oil prices prompted companies to ramp
up oil and gas production.
US crude futures climbed 7.5% in the first quarter
of 2018, re-energising oil and gas producers that
held back investments in recent years amid a steep
drop in prices. That boost has benefited service
companies, among the hardest hit by the oil price
downturn that started in mid-2014.
“Market fundamentals remain supportive, as crude
oil prices are relatively rangebound, providing
stability to customers as they evaluate projects,”
said Baker Hughes chief executive officer Lorenzo
Simonelli in a statement.
Excluding items, GE Baker Hughes earned 9 cents
per share, beating analysts’ estimates by 3 cents,
according to Thomson Reuters I/B/E/S.
Revenue rose to $5.40bn from $5.32bn on a com-
bined basis a year earlier.
Results were boosted by a $124mn benefit from
US tax reform in December 2017. Less than a year
ago conglomerate General Electric Co combined
its oilfield business with Baker Hughes, creating
the second largest oilfield services company by
revenue. The combined company achieved $144mn
in synergies in the first quarter of 2018, putting it
on track to hit an expected $700mn by year-end,
Simonelli said. Shares were up 0.8% at $33.99.
Net income attributable to the company was
$70mn, or 17 cents per share, in the quarter.
Honeywell
Honeywell International reported a higher-than-
expected quarterly profit yesterday and lifted its
full-year earnings forecast for the second time this
year, citing higher sales in its aerospace business.
Shares of the company, which makes everything
from jet engines to thermostats, rose as much as up
2.16% to $151.33 yesterday.
Honeywell’s aerospace business, its biggest,
benefited from a rise in global travel as it sold more
aircraft parts and services to the commercial airline
sector, while also seeing robust demand from
defence and business jet customers.
Sales in the division, which makes auxiliary power
units, braking systems and other parts for Boeing
and Airbus single-aisle planes, rose about 12% to
$3.98bn, while margins expanded by 10 basis points
to 22.5%.
“Growth in both air transport and business aviation
was nearly double-digit, driven by robust deliveries
on key platforms, including the Airbus A320, Boeing
737 and Bombardier Challenger 350,” Chief Finan-
cial Officer Thomas Szlosek said.
Honeywell, which also makes engines for business
jets produced by Bombardier and Textron, said it
was beginning to see the market recover as Presi-
dent Donald Trump’s tax cuts encourage corporate
America to spend more on business jets.
Vertical Research Partners analyst Robert Stallard
said Honeywell has a higher share of parts on new
business jets such as Gulfstream G500 and G600,
which will benefit the company when these planes
get certified for sale later this year.
The company said it anticipates continued double-
digit growth in its defence business, as rising global
defence spending boosts demand for spares, sen-
sors and guidance systems.
Schlumberger
Schlumberger yesterday reported first-quarter
profit that scraped past estimates, but the stock fell
1.3% on a drop in oil prices and a jump in costs for
the oilfield services provider.
Brent and US crude turned negative after US Presi-
dent Donald Trump yesterday criticised Opec for
output curbs that have helped raise global oil prices
and said “artificially” high prices would not be ac-
cepted. US and Brent crude were both down nearly
1%. Schlumberger, a bellwether for the oilfield serv-
ices and drilling industries, said global oil supply
and demand were in balance and that investments
in exploration and production were expected to rise
about 5% internationally.
The absence of normal seasonal softness indicated
that supply and demand were in balance, and com-
bined with “increased geopolitical risk” had driven
up oil prices,” Chief Executive Paal Kibsgaard said
on a call with analysts.
Oilfield service companies have benefited from a
jump in US crude prices to around $67 a barrel but
providers such as Schlumberger and Halliburton
had signalled to investors that freezing weather in
parts of the United States and frack sand delivery
delays would be a negative on first-quarter results.
Overcapacity in the pressure pumping market also
dampened earnings.
State Street Corp
Custodian bank State Street Corp reported a better-
than-expected first-quarter profit yesterday, helped
by strong asset servicing and management fees.
Servicing fees rose 9.6% to $1.42bn, while manage-
ment fees rose 23.6% to $472mn.
As a custodian bank, State Street gets most of its
revenue from managing money of customers such
as big banks and hedge funds as well as managing
investments for clients.
Assets under custody and administration rose
11.57% to a $33.28tn, while total fee revenue rose
7.5% to $2.36bn. However, expenses rose 8.15% to
$2.26bn. Shares of the company were marginally
down before the bell.
Net income available to common shareholders rose
to $605mn, or $1.62 per share, from $446mn, or
$1.15 per share, a year ago. Analysts on an average
expected State Street to reports earnings of $1.59
per share, according to Thomson Reuters I/B/E/S.
Net interest income rose 29% to $658mn US banks
have greatly benefited from seven interest rate
hikes by the Fed since 2015.
ASM International
Dutch silicon wafer equipment maker ASM Inter-
national reported a sharp drop in profitability in
the first quarter as it spent more on hiring staff in
anticipation of demand for new products, knocking
its shares to a seven-month low.
ASMI’s gross margin fell to 37.8% from 43.0% a
year earlier, while sales edged up 1% to €159mn
($196mn), at the low end of its guidance, the com-
pany said yesterday.
Brokerage Natixis cut its price target to €67 from
€70 but kept its “buy” recommendation, saying it
believed the higher costs were temporary and the
company would recover from its difficult start to
the year in the second quarter.
But ASMI shares, already rattled by signs the chip
industry may be weakening, sold off sharply and
were set for their worst day in nearly five years,
falling as much as 11%.
“The gross margin in Q1 at 38% was impacted by an
unfavourable product mix and costs related to our
preparation for further growth.
We estimate our gross margin in Q2 to show a sub-
stantial improvement bringing it back again in the
range of low- to mid-40s,” chief executive Chuck del
Prado said.
Blackstone
Bets on Spanish housing and oil assets helped
Blackstone Group mitigate stock market jitters that
weighed on it in the first quarter, with earnings at
the world’s largest manager of alternative assets
falling less than expected.
Profits have soared at private equity firms such as
Blackstone in recent years, as a US stock market
rally allowed them to sell assets for top dollar.
That rally came to an end in the first quarter, amid
a trade dispute between the world’s two largest
economies, the United States and China.
Blackstone reported a 20% drop in economic net
income per share on Thursday but still beat Wall
Street’s expectations.
“We had a solid start to the year,” president and
chief operating officer Jon Gray said in a call with
reporters. Economic net income per share came
in at 65 cents in the quarter, down from 81 cents a
year ago. Analysts on average expected 45 cents,
according to Thomson Reuters I/B/E/S.
“This backdrop for the first quarter was a bit more
challenging than we’ve seen in some time in terms
of just the broader markets, but they’ve performed
pretty well against that,” said JMP Securities analyst
Devin Ryan, who rates the stock “market outper-
form”. Blackstone’s assets under management
swelled to $449.6bn from $434bn at year-end 2017,
and a 14% rise in fee-related earnings that are linked
to a management fee on the assets held for inves-
tors also supported results.
Ericsson
Ericsson beat quarterly profit expectations yester-
day as savings started to kick in, fuelling hopes for a
recovery at the struggling mobile equipment maker
and sending its shares up 15%. The Swedish com-
pany, which is restructuring and has replaced much
of its top management, has struggled with falling
spending on networks by telecoms operators and
weak emerging markets demand.
Its first-quarter loss shrank to 0.3bn crowns
($35.6mn) from a 11.3bn loss a year earlier and beat
a mean forecast for a 2.4bn loss in a Reuters poll of
analysts. The company cut its workforce by more
than 3,000 jobs during the quarter, part of reduc-
tions that have eliminated 18,000 jobs since last
July, it said.
Ericsson said factors behind the improvement
included cost reductions, a continued ramp-up of
its 5G-ready radio system product platform and
good progress in addressing poorly performing
customer contracts in managed services.
“Our efforts to improve efficiency in service deliv-
ery and common costs are starting to pay off,” chief
executive Borje Ekholm said in a statement.
Ericsson, which competes with Huawei, Nokia and
ZTE, said it expected the Chinese market to decline
further due to reduced 4G investments, but that
its momentum was positive in its biggest market,
North America. Chief financial officer Carl Mellander
told Reuters following the report the company had
gained market share in Europe and North America.
 Saturday, April 21, 2018

GULF TIMES BUSINESS

QSE WEEKLY REVIEW

More than QR20bn added to capitalisation on higher FOL, Q1 results

By Santhosh V Perumal
Business Reporter
Higher foreign ownership limits and
buoyancy in the first quarter financials
had their way in lifting the Qatar Stock
Exchange to near-9,200 levels and add
capitalisation more than QR20bn this
week.
More than 69% of the traded constituents
extended gains this week which saw Qatar
and China explore opportunities, includ-
ing mutual listing of Qatari and Chinese
exchange traded funds (ETFs) in both
markets.
Foreign funds’ substantially strengthened
buying interests helped the 20-stock
Qatar Index gain 278 points or 3.12% this
week which saw Qatar Industrial Manu-
facturing Company (QIMD) considering
setting up a float glass project with an
estimated initial investment of QR700mn.
The market saw robust demand, espe-
cially for mid and large cap equities this
week which witnessed Al Khaliji report
QR169.49mn net profit in the first three
months of this year.
Real estate, banking and insurance
sectors were seen considerably outper-
forming the market this week which saw
Commercial Bank register net profit of
QR404.69mn in the first quarter (Q1) of
2018.
Notwithstanding the overall bullish
outlook, there was increased net selling
pressure from domestic funds this week
which saw Masraf Al Rayan net profit at
QR531mn in Q1, 2018.
The Islamic stocks were seen gaining
slower than the conventional ones this
week which saw Ahli Bank’s net profit
stand at QR176.09mn in January-March
this year.
The market witnessed a total volume of
0.54mn QATR valued at QR12.69mn trade
across 220 transactions and as many as
0.04mn QETF valued at QR4.15mn change
hands across 47 deals this week which
saw Qatar National Cement’s Q1 2018 net
profit at QR90.26mn.
The Total Return Index soared 3.12%, All
Share Index 4.36% and Al Rayan Islamic In-
dex 2.48% this week which saw no trading
of treasury bills and sovereign bonds.
The realty index surged 10.66%, banks
and financial services (5.6%), insurance
(3.26%), telecom (1.19%), industrials (1%)
and consumer good (0.88%); while trans-
port declined 0.7% this week which saw
Vodafone Qatar, Mesaieed Petrochemical
Holding, QNB and Doha Bank dominated
trading ring in volumes and value.
Major movers included Ezdan, Al Khaleej
Takaful, Aamal Company, Barwa, Doha
Bank, Commercial Bank, Widam Food, Qa-
tar Insurance, Vodafone Qatar and QIMD;
even as Zad Holding, Mannai Corporation,
Dlala and Alijarah Holding were among
the losers this week which saw telecom,
banking and industrials sectors accounted
for more than 76% of total trade volumes.
The telecom sector accounted for 32% of
the total trading volume, banks and finan-
cial services and industrials (22% each),
realty (12%), transport (6%), consumer
goods (3%) and insurance (2%) this week.
The banks and financial sector’s share in
total trade turnover was 36%, industrials
(23%), telecom (14%), consumer goods
and real estate (9% each), transport (5%)
and insurance (3%) this week.
Non-Qatari institutions’ net buying
strengthened significantly to QR192.14mn
against QR74.45mn the week ended April
12.
Local retail investors’ net selling weak-
ened influentially to QR31.13mn compared
to QR44.9mn the previous week.
Non-Qatari individuals’ net profit booking
declined perceptibly to QR4.61mn against
QR18.51mn a week ago.
However, domestic funds’ net selling
increased substantially to QR156.25mn
compared to QR11.05mn the week ended
April 12.
Total trade volume rose 26% to 61.43mn
shares, value by less than 1% to QR1.44bn
and transactions by 13% to 19,886.
The telecom sector’s trade volume almost
tripled to 19.73mn equities and value more
than doubled to QR207.24mn on 56%
increase in deals to 2,594.
The market witnessed 47% surge in the
transport sector’s trade volume to 3.81mn
stocks, 21% in value to QR66.42mn and
11% in transactions to 1,270.
The banks and financial services sector’s
trade volume shot up 16% to 13.58mn
shares, value by 10% to QR525.26mn and
deals by 13% to 6,327.
The real estate sector reported 8% expan-
sion in trade volume to 7.65mn equities,
43% in value to QR136.15mn and 39% in
transactions to 2,922.
However, the insurance sector’s trade
volume plummeted 25% to 1.29mn stocks
and value by 41% to QR37.44mn, while
deals soared 17% to 653.
There was 18% plunge in the industrials
sector’s trade volume to 13.58mn shares,
34% in value to QR337.66mn and 1% in
transactions to 4,536. The consumer
goods sector’s trade volume was down
2% to 1.79mn equities, value by 9% to
QR131.21mn and deals by 16% to 1,584.

US fines Wells Fargo EU told to be more

assertive on China
to address
$1bn for mortgage, investment gap
members. A shift in flows be-

auto loan violations

Bloomberg
Beijin tween Europe and China was
observed from 2010, with Chi-
nese FDI in the EU overtaking

T
he European Union suf-
fers a “significant gap in
investment openness”
with China that hurts the bloc’s
AFP interests, and needs to develop
New York a strategy to address long-
standing market access issues.
Those are the conclusions
flows the other way since 2014,
researchers said. China FDI in
the EU has been more than tri-
ple the continent’s in the Asian
nation for three years, driven
almost exclusively by M&A
that’s heavily restricted in the
other direction.

W
ells Fargo will pay $1bn
in fines to address de-
ficiencies identified
by regulators in its mortgage and
auto loan businesses, US offi-
cials said yesterday.
The big US bank, which has
been under fire in the wake of
a 2016 fake accounts scandal,
will pay the fines to resolve ac-
tions brought by the Office of
the Comptroller of the Currency
and the Bureau of Consumer Fi-
nancial Protection.
The penalty is the largest so
far imposed under the admin-
istration of President Donald
Trump, who has sharply criti-
cised the bank after a series of
problems.
The OCC and the consumer
bureau found that Wells Fargo
improperly charged customers
in its auto loan programme and
in some cases, “improperly re-
possessed” vehicles from bor-
rowers who were unable to pay,
said a consent order from the
agency.
They also found Wells Fargo
had wrongly charged some
customers when mortgages
failed to be secured by the
“lock” deadline for guaran-
teeing an interest rate, even
in cases where the bank itself
was responsible for the missed
deadlines.
Wells Fargo was fined “given
the severity of the deficiencies
and violations of law, the fi-
nancial harm to consumers, and
the bank’s failure to correct the
deficiencies and violations in a
timely manner,” the OCC said in
a news release.
The bank neither admitted
nor denied the allegations.
But the penalty is the lat-
est regulatory problem to befall
Wells Fargo, which also came
under fire from investors and
lawmakers over a fake accounts
scandal.
The Federal Reserve, in an
unprecedented move, in Febru-
ary ordered the bank to halt its
A customer uses an ATM outside a Wells Fargo branch in Los Angeles. The $1bn penalty on Wells Fargo is the largest so far imposed under the
administration of President Donald Trump, who has sharply criticised the bank after a series of problems.
expansion until it improves gov-
ernance, following “persistent
misconduct.”
Wells Fargo chief executive
Tim Sloan said the company had
made progress in strengthen-
ing its compliance and govern-
ance programs and “make things
right for our customers.”
The company will adjust its
first quarter earnings $800mn
downward due to the penalty,
which is not tax deductible.
That reduces net profit from
$5.5bn to $4.7bn.
“While we have more work
to do, these orders affirm that
we share the same priorities
with our regulators and that we
are committed to working with
them as we deliver our com-
mitments with focus, account-
ability, and transparency,” Sloan
said.
Wells Fargo escaped much of
the regulatory fallout experi-
enced by peers such as Bank of
America and JPMorgan Chase
from the financial crisis, but has
encountered withering criti-
cism since the fake accounts
scandal, in which it opened
some 3.5mn deposit and credit
accounts without customer
knowledge.
The bank has repeatedly apol-
ogised for the scandal and over-
hauled its leadership team.
Still executives could face
tough criticism at an annual
shareholder meeting next week.
Trump, who has favoured
cutting some bank regulations
imposed after the 2008 financial
crisis, lambasted Wells Fargo in
December, saying on Twitter
fines would be boosted for “their
bad acts against their custom-
ers.”
Consumer advocacy group
Public Citizen lauded Friday’s
announcement as reflecting
“signs of life at the Trump-run
CFPB and Comptroller,” but
added that “this can’t end ac-
countability for Wells Fargo’s
widespread misconduct.”
“Shareholders, who will be
footing the bill for this fine, did
not conceive, oversee and con-
ceal this massive fraud.
Wells Fargo executives did,”
the group said.
“Meanwhile, the Republican
corporate tax cut more than off-
sets this penalty,” Public Citizen
said.
“Wells Fargo is spending some
of this benefit on share buy-
backs, which boost the price and
senior management compensa-
tion.
On balance, these are good
times for Wells Fargo executives.”
Shares of Wells Fargo rose 2.4%
to $52.76 in morning trading.
of a new joint report released
by consulting firm Rhodium
Group in New York and the
Mercator Institute for China
Studies in Berlin. About three
out of four major Chinese ac-
quisitions in Europe since 2000
couldn’t have happened the
other way around, according to
the report, citing deals such as
Tencent Holdings Ltd’s acqui-
sition of Finnish gaming house
Supercell Oy as something Bei-
jing’s restrictions would bar at
home.
“Chinese investors enjoy one
of the most open investment
regimes in Europe, with almost
unfettered access to all indus-
tries,” analysts wrote. “China
on the other hand continues
to strategically limit access for
foreign companies in many
sectors and there is rampant in-
formal discrimination against
foreign firms.”
The cure requires Europe to
pursue a more assertive eco-
nomic strategy, they said. That
means pushing for a strong
bilateral investment treaty
and reciprocal market access
where the EU has leverage, as
well as introducing transpar-
ent screening of foreign in-
vestment for national security
concerns. The authors also ad-
vocate building coalitions with
like-minded countries such
as Organisation for Economic
Cooperation and Development
Facebook is forming team
to design its own chips
Bloomberg
San Francisco
Facebook Inc is building a team
to design its own semiconduc-
tors, adding to a trend among
technology companies to supply
themselves and lower their de-
pendence on chipmakers such
Chinese FDI in the EU fell to
€29.7bn ($37bn) last year from
a peak of €35.9bn the year be-
fore, data compiled by Rhodium
show. European investment fell
to €6.9bn from €7.5bn dur-
ing the same period. China’s
cumulative FDI has surged in
recent years to €132bn in 2017,
nearly matching European FDI
in China.
The lack of investment
reciprocity is a problem with
“tangible negative economic
impacts” that, if allowed to
persist, can generate serious
harm to European producers
and consumers, according to
the research by Thilo Hane-
mann, a senior policy fellow
at Rhodium, and Mikko Huo-
tari, who heads the program
on China’s foreign relations at
Merics.
“Uneven market access is a
distortion of free competition,
which poses a serious threat
to the functioning of efficient
markets,” they said.
“It protects less competi-
tive Chinese firms from being
defeated or swallowed by more
productive overseas compa-
nies.
It could even allow these less
productive firms to acquire or
defeat more productive over-
seas firms in their own home
market, especially if additional
subsidies and other distortions
exacerbate the situation.”
the company will launch the
Oculus Go, a $200 standalone
virtual-reality headset that runs
on a Qualcomm processor.
Facebook is also working on a
slew of smart speakers. Future
generations of those devices
could be improved by custom
chipsets. By using its own
processors, the company would
have finer control over product

Nissan said to cut hundreds of jobs at UK car plant
AFP
London
Japanese automaker Nissan will axe hundreds of staff at
its car plant in northeastern England due to a sharp fall in
diesel car sales, a source told AFP yesterday.
Questioned about media reports of hundreds of
job losses at Nissan’s factory in the coastal city of
Sunderland, a source close to the matter confirmed the
news but declined to give a timeframe.
The news also comes as Britain’s car sector, which
is largely foreign-owned, continues to face Brexit
uncertainty on the horizon.
The Sunderland plant — which builds the Juke, Leaf and
Qashqai car models, many of which are diesel — employs
7,000 workers who produce some 500,000 vehicles per
year.
However, Nissan saw British sales slump 35% in the first
quarter on an annual comparison.
That mirrors a broader trend across the British
as Intel Corp and Qualcomm
Inc, according to job listings and
people familiar with the matter.
development and would be able
to better tune its software and
hardware together.
The social media company is Facebook declined to comment
automobile industry, with demand sliding on UK our employees.” However the spokesman declined to seeking to hire a manager to on the job postings.
government plans to improve air quality. give any indication of job losses. build an “end-to-end SoC/ASIC, A system on chip, or SOC, is
And diesel car sales are also struggling elsewhere in The news comes after Jaguar Land Rover revealed one firmware and driver develop- a type of semiconductor that
Europe. week ago that it will cut production and not renew the ment organisation,” according contains several discrete com-
More and more consumers are choosing to ditch diesel contracts of around 1,000 temporary workers at its to a job listing on its corporate ponents built into one piece of
cars in favour of automobiles that are regarded as more Solihull plant in central England. website, indicating the effort is silicon. They’re typically used
environmentally-friendly. The group, owned by India’s Tata Motors, blamed still in its early stages. in mobile devices where their
The vast bulk of Sunderland-built Nissan cars are “continuing headwinds impacting the car industry”. The Menlo Park, California- space and power-saving proper-
exported to elsewhere in Europe. Japan’s major automakers have meanwhile long based company would join other ties are more valuable. The main
Meanwhile, Friday’s news came as Nissan Motor expressed concerns about the impact of Brexit on their technology giants tackling the functions of most smartphones
Manufacturing UK (NMMUK) announced that it would access to the European market. massive effort to develop chips. are provided by SOCs.
implement a “short term” reduction in volumes at the After receiving private guarantees from the British In 2010, Apple Inc started ship- An ASIC, or applications spe-
sprawling Sunderland facility. government, Carlos Ghosn, the head of Nissan, in ping its own chips and now uses cific integrated circuit, is a chip
“As previously communicated, we are transitioning to a October 2016 gave the green light to new investments in them across many of its major designed for a narrow purpose.
new range of powertrains over the next year,” a company Sunderland. product lines. Alphabet Inc’s Such components are often
spokesman said. For its part, Japanese rival Toyota announced in March Google has developed its own the fastest or most-efficient at
“As we make the operational changes required to 2017 a multi-million-pound investment in a car assembly artificial intelligence chip as well. running a particular piece of
support this, we will be managing a planned short-term plant in central England, despite Brexit worries. Facebook could use such chips to software. Their weakness is that
reduction in powertrain supply and plant volumes at Britain is scheduled to leave the European Union in power hardware devices, artificial they’re locked down and may
NMMUK in line with our 2018 business plan. March 2019 after a shock referendum that was held in intelligence software and servers become redundant over time if
“We are now discussing these operational changes with June 2016. in its data centres. Next month, software and workloads evolve.