Madoff appeals for release

Madoff appeals for release
14-03-2009

Lawyers for the American financier, Bernard Madoff, have appealed for his release from custody, a day after he pleaded guilty to the biggest fraud in the country's history. They said their client was unlikely to flee and posed no threat to the community. The lawyers were appealing against a decision to revoke his US$10 million bail and send him to jail pending sentencing in June.

US assures China over bond investments

US assures China over bond investments
14-03-2009

President Obama's economic adviser, Lawrence Summers, has moved to reassure China about the safety of its investments in the United States. Asked about concerns expressed by Premier Wen Jiabao, Mr Summers said President Obama had made it very clear that the US government would be a sound steward of the money it invested. He said the recession meant Washington had to borrow large sums. Premier Wen earlier called on Washington to ensure its response to the slow-down didn't endanger the value of China's huge investments in the US.

World Bank says 2009 looks dangerous

World Bank says 2009 looks dangerous
14-03-2009

The president of the World Bank, Robert Zoellick, has said that 2009 is shaping up to be 'a very dangerous year'. He said there was no time to delay in helping the economies of both developed and developing countries. Mr Zoellick said he believed the outlook was worse than the International Monetary Fund's analysis-- that's for growth of half a percent this year.

US trade gap shrinks to four-year low

US trade gap shrinks to four-year low
14-03-2009

Figures just released show the US trade deficit shrank more than expected in January, hitting a four-year low, as the global economic crisis continued to dampen trade volumes. The US Commerce Department said the trade gap narrowed for the sixth consecutive month to a seasonally adjusted 36 billion US dollars, down 9.7 percent from December. That was the narrowest monthly trade gap since October 2002 and below analysts' forecasts of 37.5 billion dollars.

Swiss banks to abandon secrecy

Swiss banks to abandon secrecy
14-03-2009

The government of Switzerland has announced it's to break with long-standing tradition and relax its rules on bank secrecy to enable Swiss financial institutions to co-operate with international tax evasion investigations. Switzerland has been under pressure from countries including the US, Germany and France, who want information about alleged tax evaders thought to be hiding money in Swiss accounts.

Yang urges US-China co-operation

Yang urges US-China co-operation
13-03-2009

The Foreign Minister Yang Jiechi has said the United States and China should work together to "bring about a new round of world economic growth." In remarks at the Center for Strategic and International Studies, a Washington think tank, Mr Yang said the two countries should cooperate to "weather the storm and emerge from the economic crisis victorious." Mr Yang, who meets President Obama at the White House later today, said China's stimulus package had "produced initial results, as evidenced by recent signs of economic recovery."

Liechtenstein eases bank secrecy rules

Liechtenstein eases bank secrecy rules
13-03-2009

The Alpine tax haven of Liechtenstein has agreed to ease its strict banking secrecy rules to make it easier for other countries to pursue tax evaders. In a statement, the principality said it would negotiate bilateral agreements with other countries to let them investigate bank accounts held by suspected tax evaders and fraudsters. Up to now, it's cooperated only in cases of outright fraud.


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HKEx scraps Closing Auction Session

HKEx scraps Closing Auction Session
13-03-2009

The Hong Kong Exchanges and Clearing has decided to scrap after-market trading from March the 23rd. This followed criticisms that the 10-minute trading period, after the regular market closes, was open to manipulation by big market players. On Monday, HSBC's share price slumped 12 percent after regular trading ended, prompting an investigation by the Securities and Futures Commission.

Freddie Mac reports $US50 billion loss

Freddie Mac reports $US50 billion loss
12-03-2009

Freddie Mac, the ailing US mortgage finance giant seized by the government, reported a 2008 net loss of 50.1 billion dollars. It said it had a fourth quarter net loss of 23.9 billion dollars, down slightly from a 25.3-billion-dollar loss in the third quarter. Losses in the final quarter mainly were driven by writedowns, including on the company's derivative porfolio, and increased credit-related expenses. The company was taken over by the government in September to prevent its collapse. The company said its government-appointed conservator has asked the US Treasury for an additional 30.8 billion dollars in funding as part of its bailout.

Global meltdown cuts billionaire numbers

Global meltdown cuts billionaire numbers
12-03-2009

The global economic crisis has led to a sharp drop in the number of billionaires, according to the latest annual survey by Forbes Magazine. The survey said there were now a third fewer billionaires worldwide, and of the seven-hundred-and-ninety-three still on the list, ninety percent had seen their fortunes shrink - on average, by almost a quarter.

Wall Street rises for second day

Wall Street rises for second day
12-03-2009

U.S. stocks rose for a second day after JP Morgan Chase revealed that it made some profit in January and February. The Dow Jones rose 0.04 percent to 6,929 at the closing bell after profit-taking trimmed earlier gains that saw the index break through the 7,000-point psychological level. Nasdaq was up nearly one percent.

US calls for sustained aid for economies

US calls for sustained aid for economies
12-03-2009

US Treasury Secretary Timothy Geithner has called on the Group of 20 to support their economies throughout the duration of the global economic crisis. Speaking at a news conference ahead of a meeting of G20 finance chiefs this weekend, Mr Gethner said it was important for countries to take swift action to help emerging market economies weather the economic slump. He said the G20 countries, working with the international financial institutions, should mobilize substantial resources that can be deployed quickly and in innovative ways to help emerging market economies and developing countries restore growth and begin recovery.

Regional stocks lifted by US rally

Regional stocks lifted by US rally
11-03-2009

A board shows the final numbers on the Dow Jones Industrial Average. Photo: Reuters.
Regional markets have rebounded after US stocks recorded their best day in four months. The Hang Seng Index in Hong Kong closed nearly 3 percent higher in morning trading, while the Nikkei Index in Tokyo gained 4 percent. Wall Street was boosted by the news that Citigroup was profitable in the first two months of 2009. The Dow Jones Industrial Average jumped 5.8 percent and the Nasdaq was up 7 percent. Citigroup's chief executive Vikram Pandit said the company was having its "best quarter-to-date performance since the third quarter of 2007."

Plunge in mainland trade

Plunge in mainland trade
11-03-2009

The decline in China's exports accelerated last month as a slump in global demand worsened, adding to the pressure on Beijing to boost the economy with its massive stimulus plan. Exports plunged 25.7 percent from a year earlier, compared with January's 17.5 percent fall. The customs bureau said imports fell by 24.1 percent -smaller than January's stunning 43 percent plunge but still a blow to China's trading partners. "This is clearly worse than expected," said Robert Subbaraman, an analyst with Nomura International in Hong Kong. "We were looking for a rise (in exports) of 1.2 percent. The market consensus was looking for a rise of one percent." China's trade surplus in February stood at US$4.84 billion - a massive drop from US$39.1 billion the previous month. It was down by nearly half compared with last year's February surplus, which was US$8.56 billion. "China has finally and spectacularly succumbed to the world financial crisis on the export side, and it's difficult to see why that would improve in the short term," said Paul Cavey, an economist at Macquarie Securities in Hong Kong.

Cathay reports HK$8.6bn loss

Cathay reports HK$8.6bn loss
11-03-2009

Cathay Pacific has reported a net loss of almost HK$8.6-billion for last year, on the back of falling cargo demand and volatile fuel prices. It was the airline's first annual loss for ten years. Cathay said that high oil prices in the first half of the year had hit its bottom line. It added that the tumbling oil price in the second half of 2008 had also led to losses of HK$7.6 billion from hedging contracts taken out to protect it against the high cost of fuel. "Having made a painful adjustment to high fuel prices, the aviation industry now has to adjust to a severe economic downturn," said the carrier's chairman Christopher Pratt. "Cathay Pacific expects an extremely challenging year in 2009." Turnover at the airline rose 14.9 percent year-on-year to HK$86.6-billion. The net loss compared to a profit in 2007 of HK$7-billion. Passenger numbers on Cathay and its sister airline Dragonair increased to 25-million in 2008, up 7.3 percent, mainly due to strong demand in the first half of the year. The volume of cargo carried dropped 1.6 percent to 1.6 million tonnes, as demand from goods made in Hong Kong and southern China dried up in the last quarter as a result of the global slowdown. Cathay says it will look at cost cutting measures. The airline's chief executive, Tony Tyler, said the company is reviewing some of its routes. Asked if job cuts were possible, Mr Tyler said they would consult staff if any decisions had to be made.

SFC confirms HSBC shares probe

SFC confirms HSBC shares probe
11-03-2009

The Securities and Futures Commission has confirmed that it's launched an investigation into the trading of HSBC shares during the closing auction session on Monday. The commission said it would look into whether HSBC's closing price was the result of any manipulation, or whether anyone had breached the watchdog's code of conduct by distorting the market. HSBC suffered its worst drop in more than two decades, falling 24 percent to HK$33. The share has since partially recovered.

SHK posts 95% profit fall

SHK posts 95% profit fall
11-03-2009

Sun Hung Kai Properties has posted a 95-percent fall in profit for the six-month period up until December last year. Earnings came in at HK$692-million. The plunge was due to a sharp reduction in the value of its buildings, as property prices slumped. If this factor is taken out, profit would have fallen 27-percent to HK$4.5-million. The company said it had no plans to buy land at this stage, as prices were not attractive.

BEA management changes

BEA management changes
11-03-2009

Bank of East Asia has announced changes to its senior management. The two sons of the chairman David Li will move up the ladder to become deputy chief executives. This comes after Joseph Pang stepped down from one of the posts. In another move, William Cheng will become chief financial officer, following the resignation of Daniel Wan.

IMF to forecast steep fall in trade

IMF to forecast steep fall in trade
10-03-2009

The International Monetary Fund will forecast a contraction in world trade this year of 5 percent or more in the run-up to the G20 summit of rich and emerging nations, next month, a senior trade source said on Monday. And even that figure, much steeper than the IMF's previous forecast less than two months ago, is likely to turn out to be far too conservative, as trading powers continue to announce double-digit declines in exports, the source said.

HSBC shares plunge 24%

HSBC shares plunge 24%
10-03-2009

HSBC shares have tumbled 24 percent to close at HK$33 - their lowest level since 1995. The stock price has nearly halved since the bank annnounced plans a week ago to raise capital through a rights issue at HK$28 a share. The stock, down sharply throughout the session, tumbled dramatically in late trading as an institutional investor reportedly sought to unload nearly 12-million shares. It ended HK$10-50 lower. Investment manager at DBS Vickers, Peter Lai, said the losses reflected broader scepticism about the bank's prospects amid the global downturn. "People are pessimistic about the outlook for HSBC. The US banking sector is in big trouble and HSBC is deeply involved in the US market," Mr Lai said. The plunge dragged down the Hang Seng Index, which closed 4.8 percent lower. HSBC also dropped sharply in early London trading.

First mainland deflation for 6 years

First mainland deflation for 6 years
10-03-2009

China's consumer price index has fallen into negative territory for the first time in more than six years. The National Statistics Bureau reported a 1.9 percent decline in food prices in February, helping to send the index to minus 1.6 percent. State media said it was was the first negative figure since December 2002. Inflation peaked at a 12-year high of 8.7 percent in February 2008, amid shortages of grain and pork. But it has since eased as the economy slows, raising worries that deflation might sap China's ability to bounce back. The 1.6 percent decline in consumer prices compares with a 1 percent increase in January. The statistics bureau said that the producer price index, another key price indicator, fell 4.5 percent in February. That compared with a 3.3 percent decline in January. After years of trying to cool inflation and tame the overheated economy, the government has shifted to trying to revive growth. China's central bank recently warned that the economic downturn could worsen and warned the risk of deflation is "quite big" amid collapsing consumer demand.

HSBC shares rebound amid probe

HSBC shares rebound amid probe
10-03-2009

The price of HSBC shares has rebounded amid an investigation by regulators into yesterday's dramatic plunge. The banking stock was up nearly 14 percent to HK$37-60 today, after falling 24 percent on Monday. The Financial Secretary, John Tsang, has expressed concern over the sharp fall. He said the securities regulator was probing yesterday's trading. A single transaction pushed the stock price down 12 percent seconds before the market closed. The Exchanges and Clearing said it would go through sales orders to see if there were any irregularities. The chief executive of HSBC Asia Pacific, Sandy Flockhart, has sought to calm investor fears. Mr Flockhart stressed that the bank was still making money, despite deciding to raise funds from shareholders through a rights issue. He said the volatility in the share price was expected.

HSBC seeks to reassure investors

HSBC seeks to reassure investors
10-03-2009

HSBC has attempted to shore up confidence among small shareholders in Hong Kong, after its share price tumbled 24-percent yesterday. Its chief executive for Asia Pacific, Sandy Flockhart, said the slump was caused by "technical trade". He rejected comments that there'd been panic selling in the market yesterday."This bank is making money, and it's making money for shareholders," Mr Flockhart said. "We will come through this storm." He said the bank had a "loyal base of shareholders". He was speaking just one day before a deadline for small investors to decide whether to take up additional HSBC shares. Mr Flockhart didn't answer questions on why the bank had failed issue a profit warning, why it failed to sell extra shares earlier and why it insisted it didn't need extra capital ahead of the rights issue announcement. HSBC shares rebounded 14 percent today to HK$37-60. The sudden drop in the bank's stock has triggered an inquiry by the Securities and Futures Commission, which is examining transactions during yesterday's 10-minute post-trading auction. "The SFC is aware of the movement of HSBC share prices during the closing auction yesterday. We are now making inquiries," said an SFC spokesman. The financial secretary, John Tsang, said the government is concerned about HSBC's sharp losses and that he had already met with SFC officials to discuss the issue. "I know many Hong Kong people are are very concerned about the ups and downs of the prices," Mr Tsang said.

IMF head warns of negative global growth

IMF head warns of negative global growth
10-03-2009

The head of the International Monetary Fund, Dominique Strauss-Kahn, has said that global economic growth could dip below zero this year, for the first time in decades. Speaking at a conference in Tanzania, Mr Strauss-Kahn called on the international community not to forget Africa, saying that although the economic crisis had been slow in reaching countries in the region, its impact would be severe.

Wall Street in explosive rally

Wall Street in explosive rally
11-03-2009

U.S. stocks posted their best day in four months after Citigroup said it was profitable in the first two months of 2009. The market also got a boost, lifting shares off 12-year lows. The Dow Jones Industrial Average jumped 5.8 percent and the Nasdaq was up 7 percent. The rebound came as an internal memo showed that Citigroup is seeing a return to profitability in early 2009 after punishing losses last year. Chief executive Vikram Pandit said Citi has been profitable for the first two months of 2009 and was having its "best quarter-to-date performance since the third quarter of 2007."

HSBC shares slide below HK$40

HSBC shares slide below HK$40
09-03-2009

HSBC shares have tumbled 10 percent this morning, slipping below HK$40 for the first time since 1996. Traders say worries over the health of the global banking system pushed financial shares lower. Manulife Financial and Hang Seng Bank also dropped sharply. The Hang Seng Index was down nearly 2 percent.

Car workers' union backs GM pay freeze

Car workers' union backs GM pay freeze
09-03-2009

The Canadian Auto Workers union has announced a possible deal with General Motors to freeze employees' and retirees' wages and pensions, as part of GM's North America restructuring. The agreement must still be approved by GM workers in Ontario. The beleaguered auto giant said last month it would need an additional US$22.6 billion in government aid if it is to survive a collapse of global sales amid a deepening recession. The company is also asking for up to US$6 billion in aid from Canada's government.

Malaysia to launch new stimulus plan

Malaysia to launch new stimulus plan
2009-03-09 HKT 00:12

Malaysia is to unveil a second stimulus plan worth up to US$9.4 billion in a bid to prevent its export-driven economy sliding into recession, a government official said. Finance minister Najib Razak, who is expected to take over as prime minister next month, is expected to announce details of the strategy in parliament on Tuesday.

Iran's inflation rate tops 25 percent

Iran's inflation rate tops 25 percent
09-03-2009

Inflation, one of the biggest challenges facing oil-rich Iran, hit 25.9 percent last month, local news agencies have reported. The figure was up from 24 percent in January. However, the rate is still lower than the September 2008 peak of 29 percent. Central bank officials have cited growth in the money supply as the prime factor for the surge in inflation, along with rising global prices.

Support team for Geithner is named

Support team for Geithner is named
09-03-2009

The US President, Barack Obama, has announced his nominees for three top posts to work under the Treasury Secretary Timothy Geithner, who is battling with the economic crisis. Mr Obama has chosen David Cohen as assistant Treasury secretary for anti-terrorism financing, Alan Krueger as assistant secretary for economic policy and Kim Wallace as assistant secretary for legislative affairs. All three have been serving as advisors to Mr Geithner.