ASB Securities Morning Brief for Wednesday, 16 April 2014
Wednesday, 16 April 2014

New Zealand Headlines

New Zealand Market Report: NZ Stocks rose led by Pacific Edge as investors re-evaluate prices of tech stocks after the recent a sell-off in the sector worldwide. Xero extended its decline. The NZX 50 Index rose 12.746 points, or about 0.3 percent, to 5076.285. Within the index, 26 stocks rose, 14 fell and 10 were unchanged. Turnover was $110.8 million... Read more

The New Zealand dollar fell ahead of a speech by Federal Reserve chair Janet Yellen as investors look for insight into the US central bank's view on interest rates and await tomorrow's release of local inflation figures. The kiwi slipped to 86.51 US cents at 5pm in Wellington from 86.78 cents at 8am from 86.82 cents yesterday. The trade-weighted index declined to 80.26 from 80.45... Read more

Finance Minister Bill English has cautioned against complacency and promises careful Government spending in the Budget next month. "This is not the time to think about putting our feet up," he told the Wellington Employers' Chamber of Commerce... Read more

New Zealanders can look forward to only slightly better wages and jobs growth over the next four years than they have had over the past four, according to forecasts quoted yesterday by Finance Minister Bill English. In a pre-Budget speech to the Wellington Employers Chamber of Commerce, English said the Treasury's preliminary' forecasts showed the average wage would rise from $54,700 a year to about $62,200 in 2018, an increase of $7500. That represents a cumulative rise of 13.7 per cent over four years - not much more than the 12.5 per cent increase of the past four years... Read more

Women business owners more confident than men - survey... Read more

Call for NZX to act on gender quotas... Read more

Restricting the sale of houses to foreign buyers may not help Auckland’s housing situation, BNZ chief economist Tony Alexander says. He said: “I have for the past year advocated that we mitigate the effect of unrestricted foreign buying of our houses and apartments on prices and societal cohesion by adopting Australia’s legislation.” Australia only allows non-resident buyers to purchase new properties.... Read more

Dunn Funds put on hold. The launch of a controversial new investment company that was to invest solely in residential property has been put on hold. Dunn Funds investors were told last month that the launch of the company had been delayed. It was to raise $7.5 million by offering shares at $1 each and buying 10 residential properties in the Auckland market.... Read more

The Co-operative Bank joins KiwiSaver. The Co-operative Bank is to start distributing Fisher Funds' KiwiSaver products even though rival bank TSB is a shareholder in the fund manager.... Read more

Local body tax idea 'a bit rich', says Key... Read more

Bathurst Resources says it needs an extra day to complete a discounted share placement raising funds to develop its controversial Escarpment open-cut coal mine on the Denniston Plateau near Westport. The Wellington-based mining company would raise as much as $6.87 million at its current stock price, based on its intention to make a placement amounting to 10 percent to 12 percent of its capital at a discount of 15 percent to 20 percent. The shares were at 8.2 cents before being halted yesterday and have dropped 59 percent in the past 12 months... Read more

Demand for retail offer hits shares. Scrutiny is expected to fall back on the price at which the Government is selling shares in Genesis Energy today, with "surprising" demand from retail investors. This will lead to a smaller pool being allocated to Kiwis who invested through sharebrokers. The retail offer, through which investors apply for shares by application rather than through a sharebroker, closed on Friday.... Read more

NZ Refining 2014 processing revenue may be crimped by as much as US$15M on extended shutdown... Read more

ASX-listed Arowana International wants to raise as much as $234 million in the dual-listing of its Intueri Education Group, which will establish New Zealand's biggest private training establishment (PTE). The Australian company plans to list an enlarged education group next month, selling shares at an indicative range of between $2.25 a share and $2.75, with the primary listing on the New Zealand stock exchange, it said in a statement to the ASX. Arowana would retain between 15 percent and 25 percent of Intueri, and needs shareholder approval for the transaction... Read more

Abano shareholder lobbied directors in bid to oust chairman. Abano Healthcare's biggest shareholder and former director Peter Hutson lobbied directors as early as last August to support the removal of chairman Trevor Janes and change strategy at the health clinic investor, according to a letter sent to Janes. Healthcare Industry Ltd and Steamboat Capital, the entities representing Hutson and fellow rebel shareholder James Reeves, have given Abano until tomorrow to respond to a request for a shareholders' meeting to re-run the vote on Janes' re-election last November. Hutson, Reeves and Archer Capital were rebuffed in an attempted takeover of the company and in turn this week rejected a $12.9 million cash offer from Abano yesterday to buy out the 50% of Bay International that Hutson owns. The shares were unchanged at $6.40 today, and have edged up 0.5% this year.... Read more

'Patchy' NZ market proves challenging for Opus. Global markets remain mixed with difficult market conditions in New Zealand "even in this rock-star economy" and a weakened Australian economy, Opus International Consultants says. At the Opus annual meeting in Wellington yesterday, chairman Kerry McDonald said the British and Canadian businesses in the international group, by contrast, were on a good growth trajectory. Opus chief executive David Prentice said the New Zealand market remained "patchy" but with more opportunities for work than a year ago. As reported in February, Opus made a $22.8 million net profit for the 2013 year, down slightly as a result of increased interest and tax costs.... Read more

Nufarm, the agricultural chemicals manufacturer, will close its New Zealand manufacturing plant in Auckland and shift regional production to a plant at Laverton, in the Australian state of Victoria. Consolidating production will generate annual cost savings of A$3 million ($3.25 million) and result in the elimination of up to 59 jobs at the Otahuhu, Auckland factory, Nufarm said. It will take an A$11 million ($12 million) charge in the current year for restructuring costs. The company expects the eventual sale of the Otahuhu site to generate a profit of A$10 million. The shares are rated 'hold' based on the consensus of 32 analysts polled by Reuters, with a median price target of A$4.55.... Read more

Telecom Corp, the country's biggest telecommunications company, has trimmed the size of a banking facility, while pushing out its maturity date until 2017. The Auckland-based company reduced the $400 million committed standby revolving credit facility with Australasian and global banks to $300 million, while extending the maturity date one year to April 14, 2017, it said in a statement. Telecom had total debt of $1.22 billion as at Dec. 31, with bank funding of $440 million... Read more

Award-winning Aotearoa Distillers, maker of Zumwohl brand, put into liquidation after petition from Customs Service. An award-winning New Zealand schnapps-maker - part-owned by the man who created the original recipe for 42Below Vodka - has been put into liquidation owing creditors and shareholders hundreds of thousands of dollars... Read more

Ruataniwha consents approved in draft decision, ‘single nutrient’ approach rejected. The Tukituki Catchment Proposal Board of Inquiry has granted 17 resource consents relating to the $265 million Ruataniwha Water Storage Scheme in a draft decision that would open more of the Hawke's Bay to irrigation. This controversial scheme was opposed by environmental groups but opinion among local iwi was divided. It was referred to an independent board of inquiry headed by High Court judge Lester Chisholm in June 2013, attracting 384 submissions... Read more

Ngai Tahu is yet to fully commit to investment in a giant Ruataniwha Water Storage Scheme that yesterday gained required consents in a draft decision. The Tukituki Catchment Proposal board of inquiry granted 17 consents regarding the $270 million Hawke's Bay scheme and dam that will allow more irrigation in the region. Ngai Tahu Holdings Corp chief executive Mike Sang said the South Island iwi still needed a replacement investment partner given that TrustPower had pulled out. Talks with potential partners were ongoing... Read more

'Officials ignore local investors'. Overseas developers would be "stupid" to invest in Christchurch because Government officials do not engage with locals wanting a piece of the multibillion-dollar rebuild, a frustrated city developer claims. Richard Peebles, who has more than 20 developments across the city, said officials had never tried to "woo" local investors because they were too busy unsuccessfully chasing international money. The Canterbury Earthquake Recovery Authority (Cera) denies those claims and says it works closely with local developers to encourage central city development. Peebles said the biggest problem with Cera and the Christchurch Central Development Unit (CCDU) was they did not engage enough with local investors.... Read more

Former All Black Justin Marshall is bringing a popular Australian mobile spit-roast business to New Zealand. The Auckland franchise of Coast to Coast The Golden Roast was launched with a function at the Ponsonby Rugby Club last night. Queenstown-based Marshall, who has become the catering brand's New Zealand franchisor and will run the head office here with wife Nicolle, said he was looking to sell around 17 additional franchise territories and take the business nationwide. The Golden Roast, which has more than 60 franchise operators in Australia, caters for events such as weddings, birthdays and corporate functions. The meat is cooked on site... Read more

Plans for a new $200 million 5-star hotel on Auckland's waterfront have been unveiled, with construction expected to start next year. Auckland Council mayor Len Brown says the 200-room hotel in Wynyard Quarter will be developed in partnership between council organisation Waterfront Auckland and Beijing-based property developer Fu Wah International Group. The hotel was expected to open by 2017. The $200 million investment by Fu Wah Group was believed to be one of the largest foreign investments in public infrastructure in New Zealand, Brown said... Read more

Defiant Facebook users are putting a trademarked silver fern logo on their profiles after a government agency warned against using it on social media. Last week, New Zealand Trade and Enterprise (NZTE) ordered an ex-pat Kiwi to stop using its silver fern logo on his Twitter profile, citing copyright infringement. A story revealing NZTE's email to the Twitter user attracted hundreds of comments on the Facebook page - including one inciting others to use the logo on their own social media profiles... Read more

Accounting standards chair Hoogervorst dark on Ebitda, prefers'rough' measure of net profit. The head of the global body responsible for setting accounting standards says he scratches his head over companies using an Ebitda measure of earnings but he understands why some prefer not to focus on net profit as a performance measure.... Read more

A multimillion-dollar dispute between Queenstown-based helicopter operator The Helicopter Line and Airwork subsidiary Heli Holdings over unpaid leasing fees will be heard in the High Court. In a judgment released last week, the High Court in Invercargill dismissed an application by Auckland-based leasing company Heli Holdings for summary judgment against The Helicopter Line. Heli Holdings claimed it was owed more than $2.3 million in leasing fees for eight AS355 Squirrel helicopters leased to The Helicopter Line between 2009 and 2013. Heli Holdings is also claiming $151,000 for engine repairs... Read more

Leasehold legal battle: Freezing order thawed. A freezing order over assets of a woman who abandoned her Auckland house has been thawed after the Cornwall Park Trust board failed to convince a High Court judge to extend it. The board, which owns 110 Greenlane and One Tree Hill properties, is chasing Auckland woman Yong Xin Chen for more than $300,000 in allegedly unpaid leasehold fees, renovation costs and expenses... Read more

Number of Aucklanders born overseas tops 500,000 - Census 2013... Read more

Outdoor enthusiasts have voted Save Fiordland as the best conservation initiative over the past 12 months in the inaugural Wilderness Outdoor Awards. The charity has been fighting proposals to build the Routeburn Tunnel and the monorail through Snowdon Forest – campaigns that trampers and mountaineers throughout the country have deemed important enough to commend the group for its work. Chairman of Save Fiordland, Bill Jarvie, says the result is a great morale boost for the team: “To be nominated gave us a tremendous boost. And to win shows us we have support right around the country. It also shows us that we’re the name behind the battle and that opposition to the monorail is widely held.”... Read more

Opinion - Chalkie: An intriguing struggle is developing over listed dentistry company Abano Healthcare. Hutson embarks on stage one of his comeback plan... Read more

New Zealand Herald Editorial: Government must back up bold state housing law changes... Read more

Australian Headlines

Australian Market Report: The Australian sharemarket bounce was capped by a drop in the Chinese yuan and weak Chinese lending data that stoked fears stimulus in the world’s second biggest economy was on a path of rapidly diminishing returns. The S&P/ASX 200 index climbed 0.9 per cent mid-session but dropped back to close 29.2 points, or 0.55 per cent, up at 5388.2 after Chinese March lending met forecasts but money supply slowed sharply. Domestic stocks followed the overnight bounce on Wall Street where the S&P 500 index finished 0.8 per cent up following a rally from flat in the last 30 minutes of trade... Read more

The Australian dollar is back below 94 US cents after being weighed down by weaker Chinese credit data. At 1700 AEST on Tuesday, the local unit was trading at 93.87 US cents, barely moved from 93.86 cents on Monday. The Australian dollar peaked as high as 94.25 US cents early on Tuesday morning, and started falling around 1100 AEST before dropping further on the release of Chinese money supply data, CMC chief market strategist Michael McCarthy said... Read more

The Reserve Bank has once again assured borrowers that interest rates will remain steady until it is convinced the economy is back on track. In the minutes from its April meeting two weeks ago, the RBA board said it was "prudent" to leave cash rate unchanged at its historic low of 2.5 per cent. "Members noted that the cash rate could remain at the current level for some time if the economy was to evolve broadly as expected," the minutes say. "Developments over the past month had not changed that assessment." However, the RBA did acknowledge that there had been "further signs that low interest rates were supporting domestic activity."... Read more

Audit still a secret to Treasury. The federal government is keeping its national commission of audit so tightly under wraps even its top advisers haven't seen it yet. With less than a month to go until the government hands down its first budget on May 13, the findings and recommendations of the audit remain a secret beyond the office of Prime Minister Tony Abbott and a few cabinet ministers, including Treasurer Joe Hockey... Read more

Pay hike could cost jobs: government. The Abbott government has urged the Fair Work Commission to consider warnings from 500 US economists about the “serious consequences’’ for business of raising the national minimum wage. As part of its annual minimum wage review, the commission asked the government, unions and employers for their views on a letter from 600 economists supporting an increase in the US federal minimum wage in three steps by 2016... Read more

As debate over foreign investment in Australian agricultural land and businesses heats up once again, one Nationals MP is calling for a 'mature discussion' about the issue. Bruce Scott, the federal LNP member for Maranoa in western Queensland, says the Prime Minister Tony Abbott is right to start a conversation about whether Australia's restrictions on foreign investment from Chinese state-owned enterprises are appropriate. The Prime Minister told a function in Shanghai, China, on Friday that 'investment in another country is a sign of trust'... Read more

Australian fund managers are slightly underperforming the broader market despite the economy slowly gaining traction, according to an investment survey. In the three months to March, funds tracker Mercer found the median Australian fund manager underperformed the ASX by 0.1 per cent. Weak returns were across the market, according the survey, with the benchmark index rising a ''modest'' 0.2 per cent in March... Read more

Oz Minerals says a dozen parties are looking at buying the company's key growth asset, the Carrapateena copper project in South Australia. Chief executive Terry Burgess says interest in the sale has grown since he announced in February that the company is talking to global copper producers. "All options are on the table," Mr Burgess told reporters on Tuesday. Shares in the company were up nine cents, or 2.4 per cent, at $3.84 at 1437 AEST.... Read more

Clive Palmer denies Townsville refinery has shut down or operations suspended as environmental officers keep close eye on Queensland Nickel... Read more

Rio Tinto says its key iron ore operations in Western Australia's Pilbara are on track to reach full capacity by the middle of the year, despite a weather-related drop in production in the first quarter. The company says it had a record first quarter iron ore production of 66.4 million tonnes, mostly from the Pilbara, down 6 per cent on the December quarter but up 8 per cent on the same period last year - the March quarter is typically the most affected by adverse weather from the cyclone season... Read more

Engenco says it has won a $4 million contract to provide rail workers and train drivers for the Roy Hill iron ore project in the Pilbara. The company said it had signed a deal with Leighton subsidiary John Holland, as subcontractor to Samsung C & T, for specialist railroad labour through Engenco's Perth-based Momentum business. Engenco shares closed up 2.5 cents, or 15.15 per cent, at 19 cents.... Read more

BHP Billiton has appointed British businessman Malcolm Brinded to its board.... Read more

Beacon Lighting Group has enjoyed a bright start to life on the share market, with its shares soaring by 60 per cent. Beacon is Australia's largest retailer of residential lighting, ceiling fans and light globes. The Melbourne-based company owns 71 stores, has 14 franchised stores and four commercial sales offices. Executive chairman Ian Robinson's family holds a 55 per cent stake in the company. Beacon offered 45 per cent, or 96.75 million, of the company's shares to the public, at 66 cents per share. The shares began trading at 1100 AEST on Tuesday, and added 40 cents, or 60.61 per cent, to $1.06 by the end of trade.... Read more

QBE Insurance Group Limited drops 7% in a week, is this a buying opportunity?... Read more

Australia's agriculture industry is looking to emerge as a trusted food supplier for China, an industry body says. Following Australia's high level delegation to China, led by Prime Minister Tony Abbott, National Farmers' Federation general manager of policy Tony Maher said increased ties with China offer a significant opportunity for Australia's farm sector. "China has taken over as the number one export market for Australian farm products," Mr Maher told Business Today... Read more

The Japan-Australia trade agreement could boost Queensland service industries including education, according to sector figures, but some farmers in both nations are disappointed or concerned. Hurdles also remain for international deals with Japanese companies holding long-running disquiet about labour costs in Australia. Still, the deal announced in Tokyo last week — called a free-trade agreement in Australia and an Economic Partnership Agreement in Japan — was greeted as offering opportunity... Read more

David Jones has appointed Grant Samuel to assess whether South African retailer Woolworths' $2.15 billion takeover offer is in the best interests of shareholders. David Jones confirmed the appointment to Business Spectator following last week's $4 per share offer, which was a 25 per cent premium on the $3.19 closing share price the day before the offer... Read more

Airlines, business back Badgerys Creek, Sydney Airport noncommittal. The Federal Government's announcement of a second airport for Sydney at Badgerys Creek has been met with enthusiasm by airlines and business groups, but the owner of the city's existing airport has given a lukewarm response. Sydney Airport has a right of first refusal on the project - a condition of Kingsford Smith Airport's sale by the Federal Government. The right of refusal gives Sydney Airport the first option to develop and operate any new airport within 100km of Sydney's CBD... Read more

The Federal and New South Wales Government will today announce they are spending nearly $3.5 billion on roads to support the construction of Sydney's second airport. The money will flow over the next decade and the news has been welcomed by some nervous Federal Liberal MPs in Western Sydney, who hope it will dampen community opposition to the Badgerys Creek project... Read more

A network hardware failure is believed to be behind a major outage that crashed most of the Commonwealth Bank's network around the country today. It is understood the problem was caused by a failure of a key piece of the bank's network hardware at one of its data centres. Outraged customers took to social media this morning to vent their frustration at not being able to access their money... Read more

Brookfield Multiplex wins stadium job. The State Government has named a consortium headed by Brookfield Financial and John Laing as the preferred bidder for the contract to design, build, finance and maintain Perth’s new 60,000-seat stadium at Burswood. Premier Colin Barnett said the WESTADIUM consortium was one of three shortlisted private sector parties to submit bids that addressed the technical, operational and commercial requirements of the State’s Request for Proposals... Read more

NBN Co warns it will protect its market share... Read more

Convicted insider trader John Gay cleared to run companies again.... Read more

ICAC hearing: Barry O'Farrell unable to explain phone call to Nick Di Girolamo after allegedly receiving $3,000 bottle of wine... Read more

Opinion/Analysis - Michael Pascoe: Super Australian dollar keeping interest rates down... Read more

Opinion - Harrison Polites: Australia's pensioners are both the poorest and richest in the world... Read more

Opinion/Analysis - Malcolm Maiden: Reserve Bank learns to live with a high Australian dollar... Read more

International Headlines

U.S. Market Report: The stock market has recovered somewhat from its slide Tuesday, though the technology sector was still under pressure. The Dow Jones Industrial Average and the S&P 500 reversed earlier losses to trade near the break-even point. The Nasdaq was off the lows of the day but still down significantly.... Read more

North/South Americas Market Report: North and South American markets are mixed. The S&P 500 is higher by 0.35%, while the Bovespa is leading the IPC lower. They are down 2.28% and 0.74% respectively... Read more

European Market Report: European markets finished broadly lower today with shares in Germany leading the region. The DAX is down 1.77% while France's CAC 40 is off 0.89% and London's FTSE 100 is lower by 0.64%... Read more

Asian Market Report: Asian markets finished mixed as of the most recent closing prices. The Nikkei 225 gained 0.62%, while the Hang Seng led the Shanghai Composite lower. They fell 1.60% and 1.40% respectively... Read more

US inflation stays low in March as petrol costs fall... Read more

Scarce land could blunt recovery for U.S. homebuilders... Read more

Housing, food costs on the rise... Read more

A gap in U.S. patent law has kept cheap copies of Novartis AG’s (NOVN) heart drug Diovan off the market for 18 months, costing U.S. consumers and insurers as much as $900 million in potential savings. While the Diovan patent expired in September 2012, the only company allowed to sell copies, Ranbaxy Laboratories Ltd. (RBXY), hasn’t been able to manufacture and market them after four factories it runs in India failed U.S. inspections... Read more

Turmoil at Symantec luring activists, buyers - sources. The abrupt firing of Symantec Corp Chief Executive Officer Steve Bennett last month is attracting activist investors and private equity firms to the U.S. security software maker, in a development that could potentially lead to its breakup or sale, sources familiar with the situation said. Activist investors, including ValueAct Capital, are examining the company's prospects and may decide to build up stakes to agitate for change, the sources said. ValueAct declined to comment... Read more

Johnson & Johnson showed strong growth, especially in pharmaceuticals, while its less-mature biotechnology cousins take a beating. (video only)... Read more

Coca-Cola sales beat estimates as China volumes soar. Coca-Cola Co reported better-than-expected quarterly revenue as it ramped up spending on marketing and advertising, boosting sales in emerging markets such as China. Coca-Cola, like PepsiCo Inc, has been battling falling soda sales in developed markets such as the United States as people shift to healthier options such as juices.... Read more

Economists warn that pot sales won't bring as much to Colorado coffers as was hoped... Read more

Google has bought Titan Aerospace, a maker of solar-powered drones, saying it could help bring internet access to remote parts of the world as well as solve other problems. Financial terms were not disclosed. Google Inc. said today that atmospheric satellites could also be used in disaster relief and assessing environmental damage. Titan's atmospheric satellites, which are still in development and not yet commercially available, can stay in the air for as long as five years, according to reports... Read more

EU approves 'banking union'. The European Parliament has approved the last elements of a new set of rules to prevent failing banks from ever again driving EU member states into bankruptcy. With 'banking union' passed by a very large majority, "we now have in place a true European system to supervise the eurozone banks and deal with any future failures," EU Financial Markets Commissioner Michel Barnier said... Read more

Three former ICAP brokers in UK court on Libor fixing charges... Read more

UK Inflation falls to 1.6%, the lowest since October 2009. News comes a day before labour market figures are expected to confirm that wage growth has finally overtaken inflation... Read more

Italy's loss-making Banca Monte dei Paschi di Siena is considering increasing the size of its planned share sale to help it pass a Europe-wide bank health check and repay state aid this year. Italian banks, struggling under a mountain of bad debt after two years of deep recession, are aiming to boost their capital bases to cover loan losses and meet a tough assessment of asset quality being carried out by the European Central Bank. Eight Italian banks including Monte dei Paschi di Siena, the third-largest, have already announced they will seek to raise 8 billion euros ($11 billion) of additional capital over the coming months... Read more

The German economy, Europe's biggest, is to grow by 1.8 percent this year and 2.0 percent next year, the government said in its latest updated forecasts on Tuesday. "The German economy is in a solid upturn," Economy Minister Sigmar Gabriel said in a statement. "Growth has a broad and stable basis. The driving force is domestic demand," Gabriel said, pointing to "continued favourable developments on the labour market, strong increases in household income, positive business sentiment and rising investment." Just last week, Germany's leading economic think tanks raised their growth forecasts for this year and next year, but warned of headwinds from new government policies.... Read more

Will Ukraine be able to find an alternative to Gazprom? After seeing its gas discounts canceled by the Russian gas giant, Kyiv is seeking alternatives to purchasing gas directly from Russia. Ukraine has proposed obtaining more than 50 percent of its gas by reversing gas flows from the EU, but Gazprom is blocking the move.... Read more

Naftogaz resumes imports of gas from EU via Poland... Read more

Ukraine hikes rates in bid to defend economy. Ukraine's central bank has hiked its benchmark lending rate for the first time in eight months amid an escalating confrontation with pro-Russian activists. The central bank raised the discount rate from 6.5% to 9.5% late Monday, a move that should help support the country's floundering currency and curb inflation.... Read more

Ukraine crisis could hit Russian GDP... Read more

Etihad Airways on Tuesday said revenues grew 27 per cent in the first quarter after the ambitious Abu Dhabi carrier flew significantly more passengers this year, buoyed by stakes in airlines around the world. The government-owned airline, which is in negotiations to buy a stake in Italy's Alitalia, grew its revenues to $US1.4 billion in the first three months of the year, as 3.2 million passengers used its network, 14 per cent more than in the same period a year earlier, according to an emailed statement. Etihad doesn't report audited net profit figures... Read more

Hong Kong Banks Post 30% Surge in Lending Into China. Loans to Chinese borrowers by banks in Hong Kong, including branches of mainland banks, surged 30% last year as tight credit in China and lower interest rates in Hong Kong pushed mainland clients in the city to borrow more. The increase in China loans to 2.276 trillion Hong Kong dollars (US$293 billion) was disclosed by the Hong Kong Monetary Authority on Tuesday. The release of the figures marked a rare occasion when the city's de facto central bank has made clear just how much of the increased lending from Hong Kong in recent years has ended up with Chinese borrowers... Read more

Chinese pork producer WH Group has issued shares worth $597 million to two of its executives as a reward for their contribution in the acquisition of US giant Smithfield Foods, a company filing showed. WH Group, formerly known as Shuanghui International Holdings, is the world's largest pork producer, and the company is seeking a Hong Kong listing to raise more than $5 billion in what would be the world's biggest initial public offering (IPO) for a year. In a listing document published Tuesday on the WH Group website, the firm said chief executive and chairman Wan Long was issued 573.1 million shares last October... Read more

China's bank lending surged in March from the previous month, the central bank says, but analysts dismissed the possibility of monetary easing. Domestic banks granted 1.05 trillion yuan ($179.73bn) in new loans last month, down 12.4bn yuan from a year earlier, the People's Bank of China (PBoC) said in a statement on Tuesday. The March lending figure compared with 644.5bn yuan for February and came in slightly above a median forecast of one trillion yuan, according to a poll of 16 economists by the Wall Street Journal... Read more

China gold demand to rise, World Gold Council says... Read more

Diageo bids to control India's United Spirits... Read more

India's inflation accelerated in March to a three-month high, data showed Tuesday, dashing hopes of an interest rate cut to boost the struggling economy. The Wholesale Price Index (WPI), India's closest-watched cost of living monitor, jumped by almost a percentage point from the previous month to hit a year-on-year rate of 5.7 percent in March. The data came in the midst of voting in India's mammoth election whose results are due in mid-May. A new opinion poll has predicted the Hindu nationalist opposition and its allies would win a clear parliamentary majority over the ruling Congress party... Read more

Opinion - Peter Cai: Chinese banks are passing the buck. Major Chinese banks have admiringly-low non-performing loan ratios at below 1 per cent, a result that even conservatively managed Australian banks would approve of. But the problem is that no one is taking that official figure too seriously... Read more

Opinion - Mark Hulbert: Why a debt crisis can be good for the stock market. Central banks flood the financial system with money, helping investors... Read more

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