Russia and OPEC only need to give an inch on oil 28 Jan 2016 Russia has given its biggest signal yet that a grand bargain with Saudi, Iran and the rest of OPEC to reduce oil output is possible. All sides want to avoid the economic catastrophe of $20 crude but none wants to sacrifice market share. A modest cut may be all that is required.
Japan’s Abe loses a shield but keeps his armour 28 Jan 2016 A funding scandal has claimed Economy Minister Akira Amari. Losing a close ally is embarrassing for Shinzo Abe. Still, the PM and his party remain strong. Abe’s plan to revive Japan faces challenges, but they are mostly financial and economic, not political.
Aussie port and rail battle defies market gravity 28 Jan 2016 Takeover interest has kept Asciano’s stock afloat in falling markets. Now that local rival Qube has formalised its $6.3 bln breakup bid, original suitor Brookfield is under pressure to respond or lose the backing of Asciano’s board. The recent selloff raises the stakes further.
Goldman shuffles further from eye of 1MDB storm 28 Jan 2016 The Wall Street firm made outsized fees raising money for the fund at the centre of a scandal that nearly toppled Malaysia’s prime minister. Now a top banker involved in the deals has gone on leave. Though it distances Goldman from the controversy, reputations are harder to mend.
Zoomlion’s U.S. tilt shows power of state support 28 Jan 2016 The Chinese machinery maker’s $3.3 bln approach to rival Terex defies financial logic, but could make political sense. Beijing makes no secret of its desire to build global brands. Giving Zoomlion the green light suggests it has official backing to be one of China’s flagbearers.
Toyota can make handy tune-up with Daihatsu 27 Jan 2016 The world’s top carmaker could buy out minority shareholders in its $5 bln subsidiary. That would eliminate inefficiency while boosting its small-car credentials. It’s also a good use of Toyota stock. A bolder follow-up would be to take control of affiliate Subaru.
Japan’s shareholder-friendly era faces Sharp test 26 Jan 2016 The ailing display-maker is likely to opt for a state-backed rescue over a higher-looking offer from Foxconn of Taiwan. Investors deserve a full explanation. If Japan puts industrial policy first, that would directly contradict its big push to treat investors better.
"Royal gift" is odd exoneration for Malaysian PM 26 Jan 2016 The country’s attorney general says Najib Razak received a $681 mln donation from the Saudi royal family - and then returned most of it. The explanation clears the prime minister of wrongdoing, shoring up his position. But it won’t exactly draw a line under the controversy.
AgBank scam gives Chinese banks new risk black eye 26 Jan 2016 Agricultural Bank of China is trying to track down $595 mln missing in Beijing. Though it’s a tiny fraction of the state-owned behemoth’s balance sheet, suspected embezzlement is another reason to doubt risk controls. The only benefit is that expectations are already low.
Sweeter Cairn bid is Vedanta’s least bad option 25 Jan 2016 Anil Agarwal’s Vedanta Resources is edging towards loan covenant limits. Bondholders are losing faith in the mining tycoon’s ability to tap buried cash and repay $8 bln of debt. The stress may force Agarwal to sweeten a deal to merge subsidiaries and simplify the group structure.
Vietnam’s tech feast relies on foreign ingredients 25 Jan 2016 Big overseas investors like Samsung are helping to drag the country into the global technology supply chain. Exports of electronics surged by a third to $48 bln in 2015. But the ultimate test for the country’s export-led model will be developing its own local champions.
Philips’ failed deal puts Chinese bids in the dark 22 Jan 2016 The Dutch firm’s sale of 80 pct of its specialty lighting arm to a Chinese fund has failed on U.S. security fears. Philips’ Lumileds unit has tech smarts and stateside operations, but this looks like regulatory overreach. Pending Chinese bids for hardware now seem less certain.
Foxconn is better off without Sharp 22 Jan 2016 The Taiwanese giant wants to gatecrash a state-backed rescue with its own $5 bln-plus offer. The Japanese group’s display technology would make Foxconn even more indispensable to Apple. But fixing this basket case will be hard. And Sharp’s other businesses are a poor fit.
Malaysia’s strongman faces a challenge to impress 21 Jan 2016 Prime Minister Najib Razak has survived a political scandal over dubious payments he received. He has also managed to tame debt at the sovereign fund he championed. Though his position looks secure, low oil prices and racial divisions will test efforts to repair his legacy.
Japan index: Inflationary mindset still elusive 21 Jan 2016 Our index slipped in November, retreating from its 2015 peak a month earlier. Inflation expectations weakened and wages disappointed. That highlights the challenges the Bank of Japan faces in achieving its 2 percent inflation target, despite Governor Haruhiko Kuroda’s optimism.
Investors teeter on edge of self-feeding panic 20 Jan 2016 Global equities are lurching lower as a rout in energy stocks spills into other sectors, including healthcare. The global growth outlook is looking less rosy, meaning valuations are worth reconsidering. Rising volatility, however, is apt to make much share selling indiscriminate.
China’s online arms race shows no sign of cooling 20 Jan 2016 Meituan-Dianping has raised $3.3 bln – a huge sum for a startup. The group deals site was created from a merger that was meant to curb brutal competition in China. But this new warchest, plus the huge resources of rivals like Alibaba, suggests the subsidies will keep flowing.
Cheap oil lets Ambani make $2 bln telco top-up 20 Jan 2016 Mukesh Ambani is adding to the $15 bln he has already spent building a mobile network. Investors in his Reliance Industries conglomerate have barely flinched. With low oil prices delivering fat refining margins, it’s easy to keep spending. That should worry Indian telecom rivals.
China’s foreign M&A can keep defying gravity 20 Jan 2016 A $10 bln splurge this year on outbound deals, stretching from ovens to gay-dating apps, contrasts sharply with the global shortfall of confidence in China. Local firms remain well-funded and keen to diversify. Absent a real financial crisis, or a state veto, deals will continue.
China’s just-so growth no balm for slowdown fears 19 Jan 2016 The world’s second-largest economy grew 6.9 pct last year, in line with government targets. The official picture of a gradual slowdown is at odds with market jitters. Yet the numbers do little to ease investors’ key concerns: yuan devaluation and the risk of a messy debt crisis.