Friday, April 28, 2017Sha’baan 2, 1438 AH

BUSINESSGULF TIMES

ECB keeps its money taps open

United to pay oversold fl iers up to $10,000

BEST RUN | Page 12DRAGGING ROW | Page 10

Opec wants further drop in oil stocks, working for consensusOil stocks need to move closer to 5-year average: Barkindo; Saudi, Azeri ministers agree to support extending oil cut; Iraq says will go with consensus at May Opec meeting; deal likely to be extended beyond June: Angola oil minister

ReutersParis

Opec wants oil inventories to decline further and is work-ing to ensure a policy-setting

meeting in May reaches consensus, the group’s secretary-general said yesterday in comments pointing to an extension of a global supply cut.

The Organisation of the Petrole-um Exporting Countries, Russia and other producers originally agreed to curb production by 1.8mn bpd for six months from January 1 to support the market.

Oil prices have gained support from the pact but a supply glut has been slow to shift, limiting their in-crease.

As a result, Opec members includ-ing top exporter Saudi Arabia have signalled support for extending the deal at a May 25 meeting.

Opec secretary-general Moham-mad Barkindo, speaking at a confer-ence in Paris, and other offi cials from Opec countries said the oil market was moving towards a balance be-tween supply and demand with the help of the agreement.

“While it is evident that the mar-ket rebalancing is now moving for-ward and investment specifi cally in short-cycle projects is returning, it is essential we do not take our eyes off our desired goals,” Barkindo said. “We need to see the global stock overhang move closer to its fi ve-year average.”

Barkindo did not comment directly on whether the cut would be extend-ed, but he said eff orts were under way led by Saudi Energy Minister Khalid al-Falih, who is Opec president in 2017, to get a consensus before min-isters meet next month in Vienna.

“We are confi dent that the col-laborative eff ort of Minister Khalid al-Falih and other ministers...will eventually facilitate a successful conclusion of the meeting in Vienna on the 25th,” Barkindo said.

Al-Falih met his Azeri counterpart Natig Aliyev and both agreed to sup-port continuing the production cut agreement that was signed in De-cember, the Saudi Energy Ministry said on its Twitter account yesterday.

His views were echoed by the oil ministers of Opec members Iraq and Angola, and the head of Saudi Ara-bia’s state oil company, who were also attending the Paris conference.

Iraqi Oil Minister Jabar al-Luaibi said production cuts were gradually leading to a long-awaited rebalanc-ing of the market.

The output curbs, two-thirds of which are from Opec producers, are aimed at clearing a supply glut that has depressed oil prices.

Iraq last year asked to be exempt from cutting output, raising doubts over whether it would comply with the Opec deal or wish to extend it.

But al-Luaibi said yesterday Bagh-dad would go with the consensus reached by Opec.

Angola’s oil minister, José Maria Botelho de Vasconcelos, said he be-

lieved the deal would be extended beyond June.

Opec and the outside producers are trying to erode a glut that is keep-ing prices at less than half the level of mid-2014, cutting producer oil income and reducing investment in new fi elds.

The International Energy Agency

said in its latest monthly market re-port that oil stocks in industrialised countries stood at around 3.06bn barrels at the end of February, a fi g-ure that mostly includes crude and oil products.

Stocks were some 336mn barrels above the fi ve-year average, the Par-is-based IEA said.

Economic slowdown weighing on GCC bank outlook, says BMIGCC banks are “facing rising

headwinds” as weak prices and the concomitant cutbacks in

government spending weigh on lend-ing opportunities, BMI Research has said in a report.

“There are a couple of bright spots, with higher interest income from in-creased sovereign debt issuances and the removal of sanctions on Iran,” the Fitch Group company said.

The Gulf Cooperation Council’s banking sector is facing signifi cant headwinds that will weigh on lending and deposit growth over the coming quarters, the report said.

“Our expectation for sustained weakness in oil prices will ensure a continuation of weak fi scal revenues for the six countries in the Gulf. We forecast Brent to average $57 a barrel this year and $60 in 2018,” BMI said.

In response, government spending will see “signifi cant cutbacks”, depos-its in local banks will continue to be drawn down, and liquidity will decline and lead to higher funding costs.

In broad terms, the GCC will be able to cope with higher borrowing rates which began in Q4, 2015, but this dy-

namic will dampen the growth out-look. “Overall, we forecast aggregate credit to expand by only 4.9% in 2017, which while still signifi cant, is well below the annualised 9.2% recorded between 2012 and 2016.

The primary factor in the slowdown in lending activity comes from the de-cline in oil prices and the concomitant shift in the Gulf sovereigns’ position from a net creditor to net debtor.

To fi nance the fi scal defi cits, govern-ment deposits at banks in the UAE and Saudi Arabia have already fallen by 17% and 4.5% respectively since 2015, BMI said. Government deposits account for 10% to 35% of Gulf banks ‘ non-equity fi nancing, according to international rating agencies. These deposits, which tend to be cheaper for banks than tap-ping wholesale funding markets, have kept the banks highly liquid while boos ting profi tability, BMI said.

Their reduction is of particular con-cern in Oman and Bahrain, the two economies with the lowest fi scal and external buff ers, where government deposits are already being tapped, re-sulting in tightening liquidity in the banking system.

In addition, 2017 budgets across the region show a contraction in public spending, a trend BMI expects to con-tinue as oil prices stay low for several years.

This will delay major capital ex-penditure projects, thus reducing opportunities for regional banks to fi nance large state-led development projects, which have been a key source of profi tability over the past fi ve years.

More generally, BMI said the pro-longed fall in oil prices will lead to slower deposit growth across most of the GCC and weigh on consumer and business confi dence over the longer term.

“Lending growth will also be hit by rising interest rates. Following the 25 basis point (bps) hike in interest rates across the GCC at the end of 2016 , we expect another 50 bps by the end of this year,” BMI said.

UNANSWERED QUESTIONS: Page 3

Trump’s corporate tax rewrite faces major obstacle: Cost

Demographic, social factors seen key in Mideast tourism growthThe Middle East will require further

transformation within its travel and

tourism industry owing to multi-faceted

demand shift driven by generational

and demographic changes, according to

PricewaterhouseCoopers (PwC).

With the region leading the emerging

market population boom over the past

decade, demographic and social change

is a key issue the industry would need to

tackle fast, PwC said in a report.

Finding that 40% of the region’s people

are under the age of 25 and its popula-

tion slated to rise by 50% in the next

25 years, it said “the travel and tourism

industry today finds itself at the helm of

a multi-faceted demand shift driven by

these generational and demographic

changes.”

Generation Z and the millennial to the

silver tourist brings with it numerous

opportunities and challenges, mainly

because of the polarising demands it

requires, bringing forth a new age of

innovation, it said, suggesting targeted

rebranding and proactive actions to

attract new types of travellers whilst

retaining existing customers; overhaul-

ing traditional marketing concepts and

embracing the power of social media; to

embracing a digital era.

“Over the past decade, the Middle East

has developed into a global hub for tour-

ism and leisure, attracting visitors from

all over the world. However, new winds

of change will require further transfor-

mation within the region’s travel and

tourism industry,” said Dr Martin Berlin,

Middle East partner and global deals real

estate leader at PwC.

Finding that the shift in global economic

power has placed the Middle East at the

center of many of the world’s fastest

growing markets, especially India and

China, it said as this handing over of

the torch from advanced to emerging

economies continues, the region, which

finds itself at the epicentre of these

shifts, will have to take proactive steps.

The region would need to take advan-

tage of the enviable position and central

location on the West-East corridor, PwC

said, arguing that emerging markets are

set to overtake developed ones as tour-

ism and hospitality destinations.

On the accelerating urbanisation in the

Middle East, the report said a majority of

the countries within the Gulf Coopera-

tion Council (GCC) attract urban tourists;

wherein the main city is the targeted

destination for the traveller. “Dynamic

development of urban tourism is

strongly dependent on economic and

technological growth and increased air

connectivity; all of which are positive for

the GCC region,” it said.

The Middle East travel and tourism indus-

try has many of the right ingredients to

benefit from the technological break-

throughs, with young, tech savvy popula-

tions across the spectrum and smart-

phone penetration in the GCC amongst

the highest in the world, reaching 78% in

the UAE and 77% in Saudi Arabia.

Digitisation would aff ect the entire value

chain of the travel and tourism industry;

from influencing travelling decisions, to

collecting feedback and improving the

products and services delivery, it said,

adding a business strategy, befit for the

digital age, will prove to be the key for

the industry.

2017 budgets across the region have seen contraction in public spending, a trend BMI expects to continue as oil prices stay low for several years

The Middle East travel and tourism industry has many of the right ingredients to benefi t from the technological breakthroughs, with young, tech savvy populations across the spectrum and smartphone penetration in the GCC amongst the highest in the world

Oil market rebalancing aft er Opec-led cuts: Aramco CEOThe oil market is moving towards a balance

between supply and demand with the help

of an agreement reached between Opec and

other producers to cut production, the chief

executive of Saudi Aramco said yesterday.

The Organization of the Petroleum Exporting

Countries, Russia and other producers agreed

to cut output by 1.8mn bpd for the first half of

2017, although persistent high global invento-

ries have depressed oil prices.

Opec meets again on May 25 and is expected to

extend the pact until the end of 2017 in a bid to

end the supply glut.

“The market is moving toward rebalancing,”

Aramco’s CEO Amin Nasser told a conference in

Paris. “I see the oil market pointing upward and

expect it to continue improving.”

“This returning confidence is being driven by

improving fundamentals, and accelerated by

the production agreement reached last year,”

he said referring to the OPEC-led cuts.

Despite short-term volatility in oil prices, he said

there had been “a rapid drawdown of floating

storage during the first quarter of this year.”

Oil prices dipped yesterday, weighed down by

concerns about globally bloated markets, but

traders said prices seemed to have found sup-

port around current levels.

Brent futures, the international benchmark for

oil prices, were down 50 cents at $51.32 per

barrel at 1025 GMT yesterday, but remain above

the $46 price level where they traded in late

November just before Opec announced plans

to cut supply.

Nasser said the oil industry needed to continue

investing in long-term project despite short-

term price volatility.

The Opec logo is seen at its headquarters in Vienna, Austria. Opec members including top exporter Saudi Arabia have signalled support for extending the output cut deal at a May 25 meeting.

BUSINESS

Gulf Times Friday, April 28, 20172

Saudi bank stocks strong amid brewing changes in industry; Gulf subduedReutersDubai

Shares in two Saudi banks that are in early merger talks moved in opposite di-

rections yesterday while other regional markets ended the week down as investors had little fresh company earnings and news to reallocate their funds or build po-sitions.

Alawwal Bank extended the pre-vious session’s 8.6% gains, adding 2.2%.

Shares in Saudi British Bank (SABB), however, slipped 0.9% after jumping 6.8% on Wednesday.

Six other commercial lenders rose, with the largest by assets, Na-tional Commercial bank up 1.0%.

If Alawwal and SABB were to merge they would form the third largest bank by assets.

Analysts have said that although the merger is generally positive for both banks, Alawwal would be able

to reap the benefi ts of lower cost of deposits.

Other analysts pointed out that though this may not be a harbinger of other potential bank mergers in Saudi Arabia, the industry’s land-scape will start to change and com-petition will start to stiff en.

“Smaller players that used to compete for market share with Alawwal will now face less strenu-ous competition because they will be targeting diff erent clients,” said a Riyadh-based analyst. “But on the other hand you have more in-terest from other regional and in-ternational banks wanting to set up shop in the kingdom, so the indus-try’s landscape is in the midst of a change.”

Earlier this week, Citigroup ob-tained a licence to conduct capital markets business in Saudi Arabia, after an absence of almost 13 years.

Also, a senior executive of Dubai’s Emirates NBD, which already has a licence to operate in Saudi Arabia, told Reuters they have plans to ex-

pand their presence in the kingdom in the next 12 months.

Petrochemicals, most of which have still to report earnings, re-versed from declines earlier in the session and closed modestly high-er.

Saudi Kayan Petrochemical add-ed 0.6% after falling as much as 1.1% earlier in the day.

Dubai’s index lost 0.6% near a 4-1/2 month low as decliners out-numbered gainers 20 to 12.

Emaar Malls dropped 4.8% as its shares went ex-dividend yesterday.

In neighbouring Abu Dhabi, the index also fell 0.6%, dragged down by losses in blue chips.

Developer Aldar Properties, which has yet to report fi rst quarter results, fell 1.8%.

In Egypt, the index retreated 1.2% on profi t taking.

Kuwait’s bourse was shut for a public holiday.

Elsewhere, Bahrain’s index lost 0.1% at 1,332 points, while Oman’s index rose 0.3% to 5,525 points.

Saudi sees 7,000 jobs coming from solar projects by 2020BloombergLondon/New York

Saudi Arabia is hoping its solar-power programme will gener-ate 7,000 jobs and build a local

manufacturing industry that can ex-port products to the world, reducing domestic demand for its crude oil in the process.

The Ministry of Energy and Natural Resources requires bidders seeking to build about 3.45 gigawatts of solar and wind plants by 2020 to spend 30% of the capital they invest through home-grown workers and companies, said Turki al-Shehri, head of the renew-able project development offi ce for the kingdom.

“We want to create value,” al-Shehri said in an interview at the Bloomberg New Energy Finance conference in New York on Tuesday. “We don’t just want to bring in companies that open up manufacturing facilities at a very high premium, which the consumer will end up paying. We want to ensure that whatever they are opening is competi-tive, that it can compete globally for exports.”

The remarks indicate the importance of the renewable energy programme to a kingdom that’s among the world’s biggest exporters of crude oil. With a growing population and surging de-mand for electricity, Saudi Arabia is seeking new energy supplies to en-sure that more of its oil reaches export markets instead of being consumed at home.

Ministers are working on a sec-ond auction of power-purchase deals for renewable energy developers that would grant government-guaranteed contracts for up to 25 years. Results from the current 1.02-gigawatt pro-gramme are due by the end of the year, following a 700-megawatt programme already tendered. Another 1.73 giga-watts of contracts will be awarded in a third round in time to reach the 2020 target, the offi cial said. The contracts are for both solar and wind farms.

The ministry off ers land and grid connection for the projects, requir-ing developers only to build the power

plants. It’s focusing on sites where it can displace the most expensive fuels – diesel, heavy fuel oil and forms of crude oil that Saudi Arabia now consumes to generate electricity.

But the ambition for renewables goes beyond energy needs. It’s also about spurring local industry to build prod-ucts that the nation can export, help-ing the government reach its target to diversify the economy away from fossil fuels by 2030. The programme also includes building banks, a tourist

industry and manufacturing from the proceeds of energy, some of which will come from selling a stake to investors in state oil company Saudi Arabian Oil Co, or Aramco.

“We see it as complementing oil be-cause renewables bring more than just a low-value fuel,” al-Shehri said. “It fi ts perfectly into our demand profi le, which is high demand, almost 50% higher than you see in the evening from air conditioning.”

Local content rules embedded in the

auction currently underway will be in-creased in the coming years as Saudi companies develop their capabilities.

After delaying the programme earlier this year, al-Shehri said the solar pro-gramme is back on track under the di-rect management of the energy minis-try. His renewable energy offi ce reports to the ministry. It has absorbed au-thority over renewables from the King Abdullah City for Atomic and Renew-able Energy, or KaCare, an organisation chartered by the government working

outside the energy ministry.The renewables offi ce is managed

by a board led by the energy minister and including offi cials from Aramco, KaCare and the state electricity com-pany, Saudi Electric Co.

“What’s diff erent now is the fact that they have established this offi ce,” he said. “It’s testimony to the fact that we’re serious. These tenders have years of pre-development work. Putting out a tender is easy. Putting out a good ten-der requires work.”

Bonds of Etihad, partners nosedive on Alitalia concerns

Etihad Airways’ bonds raised

through a special purpose vehi-

cle have nosedived in the sec-

ondary market, losing almost 10

cents on the dollar over the past

two days, traders and portfolio

managers said on Wednesday,

according to Reuters.

The special purpose vehicle

(SPV) includes the Abu Dhabi

airline and several other carri-

ers in which it has equity stakes.

The bonds dropped after

workers at Alitalia, which is

49%-owned by Etihad, rejected

the company’s latest turna-

round plan on Monday, blocking

the loss-making Italian airline

from accessing rescue financ-

ing.

Etihad raised some $1.2bn in

bonds over the past two years

through a special purpose vehi-

cle (SPV) called EA Partners.

The SPV’s notes – a $700mn

bond maturing in 2020 and a

$500mn bond maturing in 2021

– were trading in the low 90s on

Wednesday.

A trader spotted the 2020s with

a cash price of 92-93 while the

2021s were quoted at 90.75-

91.95. Both bonds were quoted

at par or slightly above par be-

fore Alitalia’s workers rejected

the latest turnaround plan.

Etihad did not immediately

respond to a request for com-

ment.

“The Alitalia news has put a lot

of pressure on the bonds and

it’s very diff icult to work out

where you’re going to be sitting

with such complex structures,”

said a Dubai-based fixed income

portfolio manager.

It is not clear to what extent

Etihad can guarantee the bonds

should one of the companies

in the SPV portfolio default, he

added.

A second portfolio manager

said, “Etihad may try to find a

way to bail the instrument by

maybe replacing the Alitalia

note in the structure through

a private transaction, but I

wouldn’t assume it. The note

does have Alitalia risk.”

The proceeds of the $700mn

five-year bond issued by EA

Partners in 2015 were used to

enter into separate debt obliga-

tions with the entities involved,

which were Etihad Airways, Eti-

had Airport Services, Alitalia, Air

Berlin, Jet Airways, Air Serbia

and Air Seychelles.

QSE drops as foreign institutions book profitBy Santhosh V PerumalBusiness Reporter

The Qatar Stock Exchange yesterday

plummeted below 10,100 levels mainly on

foreign institutions’ profit booking.

Selling pressure was seen especially at the

consumer goods, industrials and telecom

counters, which dragged the 20-stock

Qatar Index 1.13% to touch a 20-week low

of 10,089.86 points.

A persistent decline, albeit with a constant

tangent, was visible right from the begin-

ning for about 150 minutes, after which the

fall was sharper with the index touching a

low of near 10,050 points but only to see

some last minute buying support. Overall,

the index settled 116 points lower against

the previous close.

Small and large cap segments witnessed

higher off loading in the bourse, whose

year-to-date losses swelled to 3.32%.

Islamic stocks were seen declining

relatively slower than the main index as

well as other indices in the market, where

non-Qatari individual investors were also

net sellers.

However, domestic institutions were

increasingly net buyers and both Gulf

institutions and individuals turned bullish.

There was lower net selling by local retail

investors.

Trade turnover and volumes grew in the

bourse, where banking, real estate and

telecom sectors together accounted for

more than 85% of the total volumes.

Market capitalisation eroded more than

QR7bn, or 1.31%, to QR542.73bn as small,

large and midcap stocks shrank 1.74%,

1.16% and 0.94% respectively; while micro-

caps were up 0.06%.

The Total Return Index shrank 1.13% to

16,920.1 points, the All Share Index by 1.14%

to 2,871.97 points and the Al Rayan Islamic

Index by 1.12% to 4,045.89 points.

The consumer goods sector’s index plum-

meted 2.01%, followed by industrials (2%),

telecom (1.38%), banks and financial serv-

ices (0.98%), realty (0.91%) and transport

(0.32%); whereas insurance rose 0.18%.

More than 63% of the stocks were in the

red with major losers being QNB, Industries

Qatar, Aamal Company, Mazaya Qatar,

Woqod, Ooredoo, Vodafone Qatar, Qatar

First Bank, Zad Holding, Qatar National

Cement, Qatari Investors Group, United

Development Company, Qatar Electric-

ity and Water, Ezdan, Barwa, Nakilat and

Medicare Group.

Nevertheless, Commercial Bank, Gulf Ware-

housing, Dlala, Qatari German Company

for Medical Devices, Mesaieed Petrochemi-

cal Holding, Doha Insurance, Al Khaleej

Takaful and Qatar Islamic Insurance were

among the losers.

Non-Qatari institutions turned net sellers

to the tune of QR25.51mn compared with

net buyers of QR38.45mn on April 26.

Non-Qatari retail investors were also net

sellers to the extent of QR1.83mn against

net buyers of QR1.98mn on Wednesday.

However, domestic institutions’ net buying

rose considerably to QR21.47mn from

QR2.54mn the previous day.

The GCC (Gulf Cooperation Council) funds

were net buyers to the tune of QR7.97mn

against net sellers of QR10.92mn on April 26.

The GCC individual investors turned

net buyers to the extent of QR3.21mn

compared with net sellers of QR3.05mn on

Wednesday.

Local retail investors’ net profit booking

declined substantially to QR5.31mn from

QR28.98mn the previous day.

Total trade volumes rose 11% to 9.9mn

shares, value by 19% to QR276.68mn and

deals by 3% to 3,679.

There was a 95% surge in the real estate

sector’s trade volume to 2.99mn equities,

54% in value to QR47.16mn and 21% in

transactions to 523.

The industrials sector’s trade volume

soared 36% to 0.79mn stocks and value

by 22% to QR38.99mn, while deals fell 10%

to 852.

The market witnessed a 31% increase

in the consumer goods sector’s trade

volume to 0.34mm shares, 32% in value

to QR25.07mn and 12% in transactions to

368.

Although the banks and financial services

sector’s trade volume was rather flat at

3.34mn equities, value expanded 45% to

QR127.37mn and deals by 34% to 1,471.

However, the insurance sector’s trade

volume plummeted 67% to 0.04mn stocks,

value by 66% to QR2.72mn and transac-

tions by 75% to 43.

The transport sector saw a 64% plunge in

trade volume to 0.3mn shares, 57% in value

to QR8.41mn and 61% in deals to 99.

The telecom sector’s trade volume was

down 5% to 2.1mn equities, value by 25% to

QR26.95mn and transactions by 4% to 323.

In the debt market, there was no trading of

treasury bills and government bonds.

Record issuance marks Gulf shift towards bondsReutersDubai

The volume of interna-tional bond issues from the Gulf may hit a record

high for a second straight year in 2017 as lower oil prices crimp the capacity of banks to fi nance billions of dollars of investments and state budget defi cits.

Issuance data shows the six-nation Gulf Cooperation Coun-cil’s bond market is on track to become more important than its syndicated loan market in a re-

gion traditionally dominated by relationship-driven bank lend-ing.

This historic shift is positive for economies because it eases risks and liquidity pressures for the region’s banking system, which has been hurt by smaller fl ows of petrodollars, bankers and economists say.

It is also changing the be-haviour of investors in the bond market, which has long been led by local banks that buy the bonds to hold them until matu-rity rather than trading them.

Jumbo bond issues by govern-

ments – such as Saudi Arabia’s $17.5bn debut sale last Octo-ber, the largest ever in emerging markets – have deepened the market and created new pricing benchmarks.

This has stimulated trad-ing activity, attracting more institutional and foreign in-vestors.

Monthly Reuters polls of Mid-dle East fund managers in the last few months have shown their interest in bonds at or near record levels, to a large extent because of the bond market’s in-creasing liquidity.

The trend looks set to contin-ue. Last year Standard & Poor’s estimated the funding needs of GCC countries – Saudi Arabia, the UAE, Kuwait, Qatar, Oman and Bahrain – at $560bn be-tween 2015 and 2019.

This will push regional gov-ernments to rely heavily on bonds.

“The fi nancing requirements are signifi cantly larger than they have been historically,” said Jonathan Segal, head of capital markets for the Middle East and Africa at Mitsubishi UFJ Finan-cial Group.

“Given that the region’s fi -nancing requirements have risen very sharply, absolutely there is a need for the region to be look-ing at other sources of fi nancing and doing more to attract those sources.”

The GCC’s international bond issuance was around $30bn each year from the mid-2000s until it suddenly spiked to a record of $69bn in 2016, Thomson Reu-ters data shows.

Meanwhile, syndicated loan volumes totalled about $60bn annually in 2013 and 2014, $70bn in 2015 and $78bn last year.

If the current trends continue, bonds could overtake loans this year.

“Syndicated loans will con-tinue to be important, for in-stance in the project fi nance space, but debt capital markets will remain in focus going for-ward,” said Monica Malik, chief economist at Abu Dhabi Com-mercial Bank.

Segal said, “In this region, in the past if you had $1 of DCM (debt capital markets) for fi -nancing, roughly $3 came from loans.

Now I would not be surprised

if there is parity.” Some bor-rowers are expected to continue to fuel demand for bank loans, however.

“The absence of local curren-cy bond markets leaves regional corporates with little choice but to resort in the fi rst instance to traditional bank loans,” said Dima Jardaneh, head of regional economic research at Standard Chartered. “Also, transparency requirements for tapping inter-national capital markets could still be a deterrent for a large segment of corporates in the re-gion.”

With a growing population and surging demand for electricity, Saudi Arabia is seeking new energy supplies to ensure that more of its oil reaches export markets instead of being consumed at home

BUSINESS3Gulf Times

Friday, April 28, 2017

Trump’s corporate tax rewrite faces major obstacle: Its costDeficit issue seen limiting plan’s duration and eff ectiveness; temporary cuts might discourage investment of off shore profit

BloombergNew York

President Donald Trump off ered corporate America a sweeping tax vision whose ultimate promise of lower rates and more global competitiveness depends on one thing: longevity. Given the plan’s uncertain costs, longevity may be one thing the proposal can’t deliver.The tax plan released on Wednesday by top economic adviser Gary Cohn and Treasury Secretary Steven Mnuchin provided much for multinational corporations to rejoice over – it calls for slashing the corporate income tax rate to 15% from 35% and applying a one-time, low rate to an estimated $2.6tn in off shore profits that have so far avoided US taxes.The plan also calls for shifting to a territorial system for corporate taxes in which, going forward, most foreign profits would be exempt from US levies. Currently, the US taxes corporate income no matter where it’s earned.But it’s unclear whether or how the corporate-tax proposals would be paid for; Mnuchin has said economic growth resulting from tax cuts would cover much of the cost, but economists question that assertion. The issue is more than just academic: In order to clear the Senate without any Democratic votes, any tax plan can’t add to the deficit outside a 10-year budget window. So if the legislation isn’t revenue neutral in the long run, its tax cuts would have to be temporary – set to expire at least within a decade, and perhaps sooner.“For business rate cuts and territoriality to have their full positive eff ect on growth, businesses will eventually need more certainty that they will remain in place,” said Michael Mundaca, co-leader of the Ernst & Young Americas Tax Center and a former top Treasury

tax off icial. If the measures were only temporary, US corporations might eventually have incentives to return to the current practice of hoarding untaxed profits overseas, he said.Economist Kyle Pomerleau of the conservative Tax Foundation said in a Twitter message on Wednesday that there wasn’t enough detail to provide a cost estimate for Trump’s tax plan, while the nonpartisan Center for a Responsible Federal Budget released a rough estimate that it could cost $3tn to $7tn over the next decade – potentially “harming economic growth instead of boosting it.”Moving to a territorial system would put the US on even footing with other developed nations, which don’t tax

corporate income off shore. It would also end the so-called “lockout” eff ect, under which companies hold billions of dollars in earnings abroad to avoid US taxes. Currently, companies can defer taxes on their off shore earnings until they bring them to the US. And when they do “repatriate” their foreign income, they can claim credits against their US tax bills for any foreign taxes they’ve already paid.Under the deferral system, US companies have stockpiled an estimated $2.6tn off shore to avoid paying US taxes on it – though Trump has said repeatedly that he thinks the amount is higher. The outline that the administration released on Wednesday didn’t specify a tax rate that would be

applied to those off shore earnings, but called it a one-time rate that Mnuchin said would be “very competitive.”During the campaign, Trump had proposed a 10% tax. At that rate, a repatriation tax would raise about $147.8bn over a decade – assuming that companies were allowed to pay over time – according to an estimate made by the Urban-Brookings Tax Policy Center, a Washington policy group.Under a voluntary repatriation in 2004, 843 companies chose to bring back $312bn, which they spent mostly on dividends and share buybacks, not on new investments or hiring, as Trump has said he wants to promote.“If this is only a temporary cut and we’re going to revert back to the

old system in 10 years, do you as a company really want to invest in the US?” asked David Sites, an international tax services partner at accounting firm Grant Thornton. Longer term, Sites said, for companies to make the “structural shifts” that Trump calls for, “they have to know that 10 years from now, we’re not going to be back in the same situation.”Likewise, Trump’s call for a 15% tax rate and the territorial approach may help deter US companies from shifting their profit overseas – and from moving their tax addresses to low-tax countries like Ireland – but only if the rate lasts more than a decade, Mundaca said.Republican congressional leaders greeted the White House tax

announcement coolly, with an e-mailed statement that said the bullet-points would serve as “critical guideposts” in what’s expected to be a months-long eff ort to overhaul the US tax code.Henrietta Treyz, a managing partner and director of economic policy at Veda Partners, called Trump’s corporate tax plan “a shot for the moon” that would face fierce opposition.In the near-term, repatriation would likely spark a fresh wave of mergers and acquisitions, according to Rose Williams, a principal at Ernst & Young focused on the tax implications of deal-making. “There will be more cash on hand for transactions – you’ll see an uptick in M&A,” she said.

US budget deficitBy Rich Miller

US politicians once loudly and frequently bemoaned the size of the federal government’s budget deficit. The complaints faded as the country’s creditors showed no signs that they were worried about the government’s ability to pay its bills and the shortfall melted like ice cream on a summer’s day. The deficit shrank as a share of the economy for six straight years, narrowing to 2.5% of gross domestic product in the fiscal year that ended in September 2015. But in fiscal 2016, the gap widened again, to 3.2% of GDP. Now President Donald Trump has plans for big projects and tax cuts that could add $16tn to the debt over 20 years. Get ready to hear more about Washington spending beyond its means.

The Situation

Trump has proposed building a wall between the US and Mexico, spending as much as $1tn on infrastructure, increasing the nation’s military forces and slashing the corporate tax rate to 15%. During the past six years, his fellow Republicans in Congress have

worked to enforce strict spending caps designed to hold down the federal debt; it’s unclear whether they’ll back down in the name of party unity. The most recent numbers don’t make it easier for them. In October, the US Treasury Department reported that the budget deficit for the 2016 fiscal year was $587.4bn, up from $439.1bn the year before. This was due in part to tax breaks Congress revived in December 2015. The 2011 Budget Control Act had mandated $2tn in automatic spending reductions from 2012 to 2021, but in subsequent years Congress voted to roll back these cuts, known in Washington as the sequester. The provision will now trim spending by about $1.5tn. While the government’s annual interest bill amounted to 1.3% of GDP in 2016 — less than half what taxpayers paid when Ronald Reagan left the White House in 1989 — it’s expected to surpass 2% by 2021.Deficit decriers — including Reagan — often noted that no business would survive by running its finances in the same way as the government. Yet the historical reality is that the government doesn’t often balance its books. The US has run surpluses

in only 12 of the last 75 years. Deficits surged through World War II before peacetime brought three years of surpluses from 1947 to 1949. The prosperity during the years when Bill Clinton was in the White House led to a $128bn surplus in fiscal 2001. A year later this turned into a $157bn deficit following a brief recession and the upheavals of the September 11 terror attacks. The far bigger recession triggered by the global financial meltdown of 2008 meant

that President Barack Obama entered off ice in the midst of a four-year run of trillion-dollar deficits that ended in 2012. Though the process wasn’t pretty, Obama and his Republican-controlled Congress brought the deficit down from a high of $1.4tn in fiscal 2009.

The Argument

The long-term deficit outlook is troubling. Around 2024, when the last of the 76mn baby boomers approach

retirement age, there will be heavy demands on Social Security, the Congressional Budget Off ice says. Some economists say the pain could arrive much sooner. If Trump carries through with all his spending plans and tax cut plans, there’s a chance the inflation rate will rise sharply and swell the government’s annual interest payments. That threat is cited by politicians pushing for a smaller government and their ideological allies at think tanks like the Peter G

Peterson Foundation and Fix the Debt. If anti-deficit forces in Congress aren’t powerful enough to rein in Trump’s tax and spending ideas, another group could take aim: bond vigilantes. Investors unhappy at the thought of accelerating inflation could sharply cut their purchases of Treasury debt. That’s what happened in 1993, when bond buyers eff ectively pressured President Bill Clinton to abandon his campaign promise of a tax cut for the middle class.

Bloomberg QuickTake

Yellen may see inflation risk in cuts One page, many unanswered questionsBloombergWashington

What President Donald Trump giveth

to the economy with massive tax cuts,

Federal Reserve Chair Janet Yellen may

be tempted to taketh away with higher

interest rates.

With the economy already near maxi-

mum employment, the central bank is

inclined to use tighter credit to keep the

economy from overheating as taxes are

reduced and budget deficits increase.

Fed off icials, who have pencilled in two

more interest rate increases this year

and three next, have said they see pos-

sible fiscal stimulus as an upside risk to

the economy. That risk is only magnified

if Trump relies on more government

debt, rather than off setting tax code

changes, to finance his cuts, as adminis-

tration off icials have indicated he might.

Trump’s proposal, an outline of which

was announced on Wednesday by

Treasury Secretary Steven Mnuchin and

top White House economic adviser Gary

Cohn, potentially puts the administration

on a collision course with Fed off icials

who have almost reached their economic

goals and are in the early stages of pull-

ing up ultra-low borrowing costs.

“The biggest tax cut in history has

monetary policy implications,” said Lou

Crandall, chief economist at Wrightson

ICAP in Jersey City, New Jersey, alluding

to Mnuchin’s description of the plan. “If

the package looks like it will increase

the deficit, that will be an argument for

more tightening, not less.”

Fed policy makers would have wel-

comed fiscal stimulus earlier in the

expansion that began in mid-2009,

when unemployment was still elevated

and inflation was well below their 2%

target. But now, with the jobless rate at

almost a 10-year low and price pressures

starting to build, they don’t see a need

for a short-term prod from the federal

government.

Administration off icials have said the

president wants to chop the corporate

tax rate to 15% from 35% and to levy a

10% tax rate on cash that companies

have stockpiled overseas. He also intends

to slash individual income taxes, reduc-

ing the number of tax brackets to three

from seven. How the package is financed

is important for the Fed. If a middle-in-

come tax cut, say, is paired with limits on

how much Americans can deduct from

their obligations, then the immediate

impact on demand and the economy is

limited. If it’s not, it’s more likely to give

a short-term boost to growth that could

lead to a Fed response.

BloombergWashington

The “phenomenal” tax plan that Presi-

dent Donald Trump promised 11 weeks

ago appeared at a White House briefing

on Wednesday: It was a one-page list of

bullet-points that amounted to fewer

than 250 words.

The document was largely devoid of de-

tail, including on whether the proposed

cuts for businesses and individuals

would increase the federal deficit. The

answer to that question may determine

whether Trump’s recommended 15%

corporate tax rate – a huge cut from the

current 35% – would be permanent or

temporary.

The points that the tax outline did in-

clude – calls for slashing business taxes,

eliminating the alternative minimum

tax and the estate tax, cutting indi-

vidual income-tax rates and repealing an

investment-income tax for high earners

– amount to a conservative wish-list from

the past several years. Separately, any

one of them could provoke a titanic fight.

But the most immediate controversy is

likely to focus on cost. The Committee for

a Responsible Federal Budget released

a rough analysis saying the plan could

cost $3tn to $7tn over the next decade –

potentially “harming economic growth

instead of boosting it.”

The non-partisan research group deter-

mined that Trump’s corporate tax cut

would cost $2.2tn, while his other cuts

for other businesses would amount to

$1.5tn. Doubling the standard deduction,

which would help lower- and middle-

class taxpayers, would cost roughly

$1.5tn, the CRFB said, while repealing the

estate tax, which would benefit wealthy

families, would cost $200bn. Treasury

Secretary Steven Mnuchin said during a

White House briefing to roll out the plan

Wednesday that it would lead to rapid

economic growth, helping to cover the

cost of the cuts – but many tax experts

disagree. “No tax cut has ever been

self-financing,” wrote Howard Gleckman,

a senior fellow at the Urban-Brookings

Tax Policy Center, in an online post

Wednesday.

Other tax experts who would normally

jump to analyse the plan were foiled by

the scant specifics. “Sorry, friends. We

cannot model this. Definitely not enough

detail,” Kyle Pomerleau, director of

federal projects for the Tax Foundation,

said in a Twitter message. Len Burman,

a fellow at the Urban Institute, was more

pointed: “First draft of Reagan tax reform:

three-volume 500+ page treatise. First

draft of Trump: bullet points.”

US National Economic Director Gary Cohn (left) and Treasury Secretary Steven Mnuchin unveil the Trump administration’s tax reform proposal in Washington on Wednesday. The plan provided much for multinational corporations to rejoice over – it calls for slashing the corporate income tax rate to 15% from 35% and applying a one-time, low rate to an estimated $2.6tn in off shore profits that have so far avoided US taxes.

BUSINESS

Gulf Times Friday, April 28, 20174

BoJ chief warns on ‘likely’ delay on infl ation targetAFPTokyo

Japan’s central bank chief warned yesterday it is “likely” that an in-fl ation target already running four

years late would be delayed once again.Bank of Japan (BoJ) governor

Haruhiko Kuroda added that policy-makers would not slow down their monetary easing programme until their 2% goal had been achieved.

“It’s likely that the timing of exceed-ing 2% infl ation in a stable manner will be later than” March 2019, Bank of Ja-pan governor Haruhiko Kuroda told re-porters yesterday.

The fi gure is seen as crucial to ending years of defl ation and putting Japan’s torpid economy on a stable path.

Kuroda’s comments come as the US central bank raises interest rates while speculation swirls that the European Central Bank is considering backing off its own stimulus by turning off the taps on massive bond-buying or raising borrowing costs from historic lows.

The BoJ – which trimmed its an-nual infl ation forecast yesterday after a two-day meeting – had already been forced to push back its price target sev-eral times, having set an original date of March 2015.

“Governor Kuroda poured cold water on expectations of tighter policy in the post-meeting press conference,” re-search house Capital Economics said in a commentary.

“Today’s downward forecast adjust-ment highlights that the Bank is still struggling to lift infl ation

“What’s more, we believe that the Bank remains too optimistic about in-fl ation,” it added.

Policymakers yesterday lowered their infl ation forecast to 1.4% for the fi scal year to March 2018 from an earlier esti-mate of 1.5%.

After wrapping up its meeting yes-terday, the bank kept monetary policy

unchanged and issued a relatively up-beat view on the world’s number three economy, slightly upgrading its annual growth outlook.

The BoJ raised its economic growth forecast for the current fi scal year to 1.6% from 1.5% earlier.

It also left its massive ¥80tn ($719bn) annual asset-purchase scheme un-

changed and said it would press on with a plan to keep the yield on government 10-year bonds around zero.

Both measures are central to the bank’s eff orts to hike consumer prices and stimulate the economy.

This month, the International Mon-etary Fund (IMF) raised its growth fore-cast for Japan’s economy this year and

next, citing a pickup in exports, but it warned that a shrinking labour force and below-forecast infl ation would curb longer-term expansion.

Prime Minister Shinzo Abe swept to power in late 2012 on a pledge to con-quer defl ation and create a lasting re-covery through a growth plan dubbed Abenomics.

The scheme – a mix of aggressive monetary easing and huge government spending along with reforms to the economy – stoked a stock market rally as it weakened the yen and fattened cor-porate profi ts.

But its eff ect on the wider economy has been less dramatic, with promised reforms slow in coming.

Qantas to axe Dubai fl ights, boost Asian presenceReutersSydney

Australian national carrier Qantas Air-ways Ltd yesterday said it would axe its Melbourne-Dubai-London fl ights

operated in partnership with Emirates and switch the capacity to Asia when it launches non-stop Perth-London fl ights next year.

The move is part of a strategy of cutting the journey time to London to gain an edge and pricing premium over the two dozen rivals off ering one-stop fl ights on the so-called Kangaroo route.

Qantas will charge a premium of as much

as 48% in economy class and 62% in busi-ness class relative to one-stop rivals like Qatar Airways and Singapore Airlines on the Perth-London route in return for saving three hours of travel time, according to online price com-parisons.

Qantas chief executive Alan Joyce has said his airline could be operating non-stop fl ights from Sydney and Melbourne to Lon-don within fi ve years as Airbus SE and Boe-ing Co introduce longer-range aircraft. The 17-hour Perth-London fl ight on a Boeing 787-9 will originate and end in Melbourne and will not be subject to heightened secu-rity checks for Middle Eastern fl ights as a result.

It will cut more than an hour off the fl y-ing time from Melbourne to London relative to the current route through Dubai, Qantas said in a statement.

Sydney-Dubai-London will be the Australian airline’s only fl ight operating through the Emirates hub once the change takes place in March.

Qantas’s capacity to London will fall as a result of the switch to a 787 from a larger A380. Two A380s that had been serving the Melbourne-Dubai-London route would be redeployed to meet periods of high demand from Melbourne and Sydney to destinations in Asia, such as Singapore and Hong Kong, a Qantas spokeswoman said.

A man walks in a store selling electric household goods in Tokyo. Japan’s central bank chief said that policymakers would not slow down their monetary easing programme until their 2% goal had been achieved.

Australia plans LNG export limits to help ease local price painReutersMelbourne

Australia’s conservative government un-

veiled a radical plan yesterday to restrict

exports of liquefied natural gas (LNG) at

times when domestic shortages push

up local prices, aiming to ease soaring

energy costs for local manufacturers.

The plan would allow Australia’s

resources minister to impose controls on

LNG exports on advice from the market

operator and regulator, as the govern-

ment seeks to cap domestic gas prices,

which have become a political hot potato.

“It’s not a threat. This will be export

controls. They will not be able to export

gas if that has the consequence of reduc-

ing the availability of gas for the Austral-

ian market,” Prime Minister Malcolm

Turnbull told Australian Broadcasting

Corp radio. Australia is the world’s second-

largest LNG exporter after Qatar, but local

gas prices have rocketed over the past

two years with the start of LNG exports

from three newly built plants in eastern

Australia to customers in China, Japan,

Korea and Malaysia.

The government’s move drew a swift

rebuke from gas producers, who called

instead for curbs on onshore gas explora-

tion to be lifted to help boost supply.

“Restricting exports is almost unprec-

edented for Australia,” said Malcolm

Roberts, chief executive of the Australian

Petroleum Production and Exploration

Association.

The Australian Energy Market Operator

warned in March of a shortage set to hit

eastern Australia and has already taken

steps to ensure there is enough gas for

power plants at peak times.

At least one of the east coast LNG

plants, Gladstone LNG (GLNG) – operated

by Australia’s Santos Ltd – is drawing gas

out of the domestic market to help meet

its export contracts.

Santos said yesterday it was seeking

more details on how the new policy would

work.

“Moving forward, Santos will supply

more gas into the Australian domestic

market than it purchases for its share of

LNG exports,” it said in a statement to the

stock exchange.

The two other eastern LNG exporters,

Queensland Curtis LNG, operated by

Royal Dutch Shell, and Australia Pacific

LNG, operated by ConocoPhillips, have

committed to being net gas suppliers to

the domestic market.

Manufacturers welcomed Turnbull’s

move.

“The government has given themselves

a bigger stick to ensure the gas industry

balances the needs of their international

customers and their obligation to sup-

ply the domestic market with gas at a

fair price,” Energy Users Association of

Australia chief executive Andrew Richards

said in a statement.

Companies including France’s Engie SA

and Origin Energy have sealed deals to

ensure gas supply to power plants at peak

times, easing some short-term concerns

about shortages that have already helped

to trigger blackouts.

Didi seeks $6bn fundingReutersHong Kong/Beijing

Didi Chuxing, China’s top ride-hailing fi rm, is set to become the country’s

second-most valuable privately owned company, with a valua-tion of more than $50bn, through a fund raising round of up to $6bn, sources said yesterday.

The valuation represents a jump from Didi’s $34bn price tag in August, when it agreed to acquire Uber Technology Inc’s China business, and also puts it closer to the US fi rm’s $68bn.

It also propels Didi well above Xiaomi Inc, which held the title of China’s most valuable star-tup after a 2014 funding round valued the smartphone maker at $46bn.

Ant Financial, China’s most valuable private internet fi nance fi rm and an affi liate of Alibaba Group Holding Ltd, is valued up-wards of $60bn.

The funding round has drawn investors including Japan’s Soft-bank Group Corp, private equity fi rm Silver Lake Partners, China Merchants Bank and Bank of Communications, two people familiar with the matter said.

They declined to be identifi ed because they are not authorised to speak publicly.

Didi Chuxing and Softbank declined to comment, while Sil-ver Lake, China Merchants Bank and Bank of Communications did not immediately respond to a request for comment.

The people said that part of the latest capital investment in Didi would be used for interna-tional expansion.

Didi has sealed several over-seas partnerships, focusing on intelligent driving, such as mak-ing use of artifi cial intelligence, as well as similar ride-hailing services.

The fi rm is ramping up over-seas activity as regulatory changes are set to take a toll on their local service.

Draft rules released in October would slash the number of eligi-ble drivers and double fares for users in major cities, the com-pany has said.

Since Uber exited the Chi-nese market last year following a drawn-out rivalry with Didi, the Chinese fi rm has sought to ex-pand in Latin America, leading a $100mn investment in Brazilian ride-hailing service 99 in Janu-ary.

Last month it offi cially opened a lab researching artifi cial in-telligence-related driving tech-nologies in Silicon Valley in the United States.

The company has previous-ly entered a range of strategic agreements with US tech fi rms including Lyft, TripAdvisor Inc and Udacity.

Qantas Airways aircraft at Sydney Airport. The airline yesterday said it would axe its Melbourne-Dubai-London flights operated in partnership with Emirates and switch the capacity to Asia.

Customers in short supply at HSBC’s Pearl River Delta branches, core of China planReutersLondon/Hong Kong

In the digital age, footfall in bricks-and-

mortar outlets is an incomplete measure

of business activity, but HSBC’s sparsely

attended branches in the Pearl River Delta

suggest it’s not all plain sailing for the

bank’s expansion in mainland China.

HSBC, the world’s sixth-largest bank by

assets, announced in 2015 that it would

hire 4,000 new staff and invest billions

to make the Pearl River Delta (PRD) its

gateway to China, a retail and corporate

banking push that bet on a tech boom,

infrastructure spending and a growing

middle class.

It is, as chief executive Stuart Gulliver

reminded shareholders in Hong Kong on

Monday, a key plank of the bank’s global

strategy to improve profits by focusing on

markets with stronger economic growth.

PRD already generates more than 10%

of China’s GDP and over a quarter of its

exports. On the ground, HSBC still has a

mountain to climb.

In a rundown mall in Houjie, a factory

town in the urban sprawl of Dongguan,

the HSBC branch stands out with its bright

posters, colourful pamphlets for credit

cards and smiling receptionist, but only a

handful of customers an hour crossed the

threshold during a Reuters visit last week.

At the Industrial and Commercial

Bank of China (ICBC) branch in nearby

Changan, dozens rolled up in a similar

period. At a branch in a leafy district of

Shenzhen, again HSBC was far quieter

than rivals China Merchants Bank and

China Construction Bank.

Some customers, like Way Zhi, a

28-year-old who helps run a family trading

business, welcome the peace – you don’t

have to “waste a few hours each time”

like in local banks, he said – but it is a

reminder that HSBC has some way to go

to scale up.

Large local rivals in the PRD, most

state-backed, each have more than 1,000

branches to HSBC’s 114 including Guang-

dong, and they don’t have the headache

of the tough compliance rules that HSBC

has to follow to safeguard its international

business.

It’s a headache the bank has to pass on

to prospective customers.

A factory owner who gave his surname

as Luo said he opened an HSBC account

last year to facilitate his business making

wooden floorboards and panels for clients

in Hong Kong, where HSBC was founded

in 1865.

Luo, who spoke to Reuters as he was

leaving the Houjie branch, represents the

kind of aff luent Chinese customer with

business in Hong Kong that the bank is

keen to snag.

But opening a bank account was “quite

a lot of trouble”, he said, and took nearly

two weeks. HSBC’s customer-checking

procedures have got tighter in recent

years after it was hit with billions of

dollars in fines in the US for lapses in anti-

money laundering controls.

A HSBC staff member at the branch,

who declined to be named, confirmed that

customer background checks can take

longer than at local banks that have no or

negligible US business at risk and are not

subject to global regulatory scrutiny.

HSBC says it is pleased with its progress

in China. At the start of April it had

150,000 credit cards in circulation, having

begun to issue them in December, mostly

after digital applications.

It has also launched online trading

and banking over social media platform

WeChat. “We do not intend to compete on

a traditional basis in PRD. Absolute branch

numbers and footfall will not be our

measure,” said Kevin Martin, HSBC’s Asia

Pacific head of retail banking and wealth

management.

But that’s a game its big rivals are also

playing; ICBC, for example, has off ered

WeChat banking since 2013.

Since HSBC announced its strategy in

June 2015, China’s slowing growth and

a stock market crash have prompted a

rethink on the pace of expansion.

CEO Gulliver said last year it would take

on the 4,000 new regional hires over five

years, not three, as initially planned.

“Quite rightly, management felt at

that time they didn’t want to achieve the

strategy by taking on more risk,” Sam

Laidlaw, an independent board member

at HSBC, told Reuters. Investors remain

broadly positive.

“It’s not an overnight thing, and of

course everyone wants it to be faster.

The (China) strategy should be pursued

– but it is only one of many strategies for

HSBC,” said Hugh Young, Singapore-based

fund manager at Aberdeen Asset Manage-

ment, HSBC’s 6th-largest shareholder.

And what figures the bank has

disclosed for 2016 are encouraging,

albeit from a low base; it said in its annual

report that its number of retail banking

and wealth management clients and its

mortgage loan book in the area had both

increased by 51% during the year.

But it also has some battles with red

tape to win. The lender is still waiting

for approval for its securities business

venture with a state-owned fund in the

PRD, more than a year after it announced

the partnership.

And some say the bank remains

something of an outsider. At the Ling Jia

Property Agency, a few metres from HSBC’s

Houjie branch, realtor Yi Linfeng said most

of his customers use ICBC for mortgages.

None, he says, have ever used HSBC. “I think

they mostly have foreign customers from

Taiwan and Hong Kong.”

BUSINESS5Gulf Times

Friday, April 28, 2017

ReutersHong Kong

China’s wealth management in-dustry is preparing for a boom in automated investment advice

and trading programmes, or “robo-ad-visers”, as brokerages, banks and insur-ers look for a cheaper way to increase revenue from retail clients.

Robo advice services barely existed in China before 2015, but they are expected to manage $27.1bn of assets at the end of 2017, though that remains small rela-tive to the $182bn fi gure for the United States, where services launched several years earlier, according to market re-search fi rm Statista.

But the market in China is forecast to more than double every year from 2017 to 2021, compared with US growth of 29% a year, which will rapidly narrow the gap, Statista fi gures show.

The number of Chinese investors using robo services is forecast to soar to 79.4mn over that period from fewer than 2mn last year.

“Everyone talks about the billion-aires, but actually we’re talking about hundreds of millions of customers in that income band who are basically starting to have investable assets that they want to reposition and redeploy,” said Matthew Phillips, fi nancial serv-ices leader for PwC China and Hong Kong.

“The only way to service those cus-tomers is to automate those processes.”

Competition from large fi nancial technology (Fintech) companies, in-cluding Alibaba Group affi liate Ant Fi-nancial, Ping An-backed Lufax, and startups such as WaCai is pushing tra-ditional fi nancial companies to embrace the trend.

Some traditional players without the technical expertise to develop their own robo advisers are turning to technology fi rms such as Pintec Group’s Xuanji and MiCai.

Others, like China Merchants Bank (CMB), the country’s largest non-state-backed lender, have managed to create their own.

After a months-long nationwide ad-vertising campaign, CMB launched in December its “Machine Gene Invest-ment”, or Mojie robo advisory service, which pre-selects a range of assets and trades them automatically, cutting the costs of investment advice for users of its Internet banking app.

The bank said users had invested an average 36,900 yuan ($5,360) each so far in the new service, and a person fa-miliar with the bank’s business said the service had racked up 3bn yuan in assets under management in just a couple of months.

After months in development, Ant Financial, the world’s largest fi ntech fi rm, will be launching automated ad-vice to its millions of clients this year, people familiar with the plans told Reu-ters. The company itself said it wouldn’t be off ering them “in the short-term”.

The sources also said Industrial and Commercial Bank of China (ICBC) is

about to introduce a similar tool.ICBC, the world’s largest bank by as-

sets, declined to comment.Moves by the two behemoths could

tempt others off the fence about robo services.

“When you have a main-street bank that did a huge marketing campaign in that particular fi eld... that solution becomes a must-have for the industry, and the bigger state-owned banks fol-low them,” said Gregory Van den Bergh, chief executive of MiCai, China’s oldest robo adviser. “It’s had a very good eff ect on the industry.”

Xuanji signed early in 2017 to have its

technology run Minsheng Securities’ robo adviser and expects to soon close other deals with an insurer and a bank in China, CEO Zheng Yudong said.

MiCai is getting many inquiries from banks in mainland China, though the company can’t disclose the names of clients, Van den Bergh added.

An EY survey of wealth management clients and industry executives showed Chinese respondents, who are already used to handling most of their fi nances on mobile phones, were the most likely in Asia Pacifi c to open robo advisory ac-counts.

As many as 76% said they would

consider it, compared with just 25% in Australia.

Given low-interest rates in China and expensive real estate, Chinese investors are seeking alternative ways to gener-ate returns, while avoiding the volatility that followed a major slump in Shang-hai and Shenzhen stock markets in 2015.

Many hope that a robo-tailored port-folio can deliver.

“Robo advisory is not for gamblers. It’s not a sexy product.

It’s supposed to prevent volatility; it focuses on stability, so lower returns, but no spikes up and down,” Xuanji’s Zheng said.

China banks, brokers eye robo advice for edge on competition

Kia Motors announces $1bn India investmentAFPNew Delhi

South Korean car maker Kia Motors said yesterday it will build a new $1.1bn

plant in India, marking its en-try into one of the world’s fast-est growing markets as sales in neighbouring China have sagged.

Kia Motors said in a state-ment it would manufacture up to 300,000 cars a year at the new factory in the southern state of Andhra Pradesh, starting in late 2019.

Kia and its sister company Hyundai Motor have seen sales in China, the world’s biggest car market, hammered by the fallout from a diplomatic spat between Seoul and Beijing over a US mis-sile defence system.

The company plans to pro-duce a compact sedan and com-pact SUV especially for the In-dian market at the new plant.

India is the world’s fi fth big-gest auto market and is growing rapidly.

Nearly 4mn cars were sold there last year and PriceWater-houseCoopers predicts that will rise to almost 7mn by 2022.

“India is a key market and you lose a big opportunity for future growth if you’re not here,” said Abdul Majeed, partner at PWC.

“Apart from selling to cus-tomers in India, global auto makers are also looking at how to use India as base to design and source parts and now Kia is on that journey.”

Hyundai Motor is the second largest auto maker in India be-hind Maruti Suzuki India and analysts expect Kia to use some of Hyundai’s existing supply chain network.

Volkswagen was one of the last global auto giants to launch in India in 2010, but has struggled to capture market share.

The company plans to produce a compact sedan and compact SUV especially for the Indian market at the new plant

S Korea raises 2017 export outlook as economy speeds upReutersSeoul

South Korea raised its export outlook for the year after fi rst quarter economic growth accelerated at a sharper pace, with policymakers saying there was no need for extra stimulus

even as the economy faces a host of political and economic chal-lenges.

The fi rm start to the year on strong exports and capital invest-ment is a relief for policymakers after months of political crisis and as the country prepares to elect a new president in May amid rising tensions with neighbours North Korea and China.

With overall growth rebounding, drawing up a supplementary budget to boost the economy won’t be necessary for now, Finance Minister Yoo Il-ho told reporters, although the fi nal decision may be up to the nation’s next leader.

Growth in the second quarter won’t slow sharply, Yoo added, but uncertainties will continue to persist.

Gross domestic product grew a seasonally adjusted 0.9% in the fi rst quarter, the Bank of Korea said earlier yesterday, accelerating from a 0.5% quarterly expansion in the fi nal three months of last year.

It was the fastest pace since the second quarter of 2016 when the economy grew 0.9%. The median forecast in a Reuters survey was for a 0.7% expansion. From a year earlier, GDP rose 2.7% in the fi rst quarter.

Facility investment led overall growth with a 4.3% gain on quarter, while exports gained 1.9% after declining 0.1% a quarter earlier. Private consumption grew 0.4%, accelerating from 0.2% previously. Construction investment growth leapt 5.3% from three months earlier, as “apartment projects that boomed from a year earlier are still supporting economic growth,” a fi nance min-istry offi cial said.

Still, South Korea’s service sector barely averted decline and rose at the slowest pace in 32 quarters, 0.1%, from three months earlier. “Chinese tourist numbers fell due to China’s restrictions on travel to South Korea, while consumer sentiment was sluggish.

Some also delayed buying their mobile phones waiting for new smartphone releases,” Chung Kyu-il, a director general at the BOK said. China has ordered a halt to tours to South Korea in retaliation against Seoul’s decision to deploy the US

Terminal High Altitude Area Defence radar system.Asia’s fourth-largest economy will hold a presidential election

on May 9 following the impeachment of ex-leader Park Geun-hye.Leading democratic candidate Moon Jae-in has already prom-

ised an extra budget of at least 10tn won ($8.90bn), although many analysts including Stephen Lee, chief economist at Meritz Securi-ties, said current economic conditions don’t warrant one for now.

“Drawing up an extra budget wouldn’t make sense anymore,” Lee said. “We have to see who’ll become president, but I think it would be better to focus on spending on next year’s budget in or-der to improve the fundamentals of the economy.”

China still hungry for copper, but not in refined formBy Andy HomeLondon

China’s imports of refined copper slumped by

28% year-on-year in the first quarter of 2017.

Factoring in exports, now a regular feature

of the country’s trade picture, the slide in net

metal imports was an even more dramatic

35%.

The net draw on units from the rest of the

world was 699,000 tonnes in the first three

months of the year, a decline of 368,000

tonnes on the same period of 2016.

Look no further to understand why cop-

per’s early-year bull run to over $6,200-per

tonne, basis three-month metal on the Lon-

don Metal Exchange, has stalled.

The price is today trading around $5,720.

Even while production disruptions have

accumulated, any impact on refined metal

availability has been muted, witness the

near 185,000-tonne build in global exchange

stocks in the first quarter.

However, it’s not as if China has lost its ap-

petite for imported copper.

It’s just that it has shifted to other forms of

the metal.

Imports of scrap seemed to be in long-term

decline having fallen in each of the last four

years.

Volumes last year were 3.35mn tonnes

(bulk weight, not metal contained), compared

with 4.86mn tonnes in 2012.

That steady downtrend, however, has gone

into sharp reverse over the last few months.

Imports accelerated by 22% to 907,000

tonnes in January-March, the highest first-

quarter level since 2013.

This is part and parcel of what seems to be

a global surge in scrap supply occasioned by

the sharp jump in the copper price from un-

der $5,000 in the fourth quarter of last year.

This is how large parts of the scrap sector

“hedge” their price exposure.

When the price falls, sales of material

bought at higher prices simply dry up.

Accumulated stocks are only released

when the price rises to a suff icient level to

make them profitable again.

Discounts for copper scrap in both the

United States and Europe have flexed wider

since the fourth quarter of last year, attesting

to much improved availability.

It’s no surprise, therefore, to see the world’s

largest buyer of copper soak up this cheaper

source of metal.

The scrap import surge is a recent phe-

nomenon.

The rise in mined concentrate imports

is part of a longer-running trend rooted in

China’s build-out of refining capacity.

Imports of concentrates have risen every

year since 2011 with the pace accelerating in

2016 thanks to much-improved mine supply.

And the trend was extended in the first

quarter with inbound flows of concentrate

rising another 8.5% to 4.31mn tonnes (bulk

weight).

True, there is clear evidence of the supply

hits at Freeport McMoRan’s Grasberg mine

in Indonesia and at BHP Billiton’s Escondida

mine in Chile.

Imports of concentrate from Indonesia al-

most dried up completely in March itself with

the first quarter tally of 66,100 tonnes down

by a third on last year’s equivalent.

Those from Chile, meanwhile, grew by just

3% in the period after growth of 27% last year

and the country was overtaken by Peru as

China’s top supplier of mined concentrates.

But compensation came in particular

from sharp jumps in imports from Spain and

Kazakhstan, China’s sixth and seventh largest

volume suppliers in the first quarter.

Concentrate imports in March itself were

1.63mn tonnes, still the third highest monthly

total on record after November and Decem-

ber 2016.

The steady rise in China’s appetite for

imported copper concentrates is part of a

long-running trend and one which will serve

eventually to dampen the country’s require-

ment for imports of refined metal.

However, it’s clear that the short-term

weakness in refined metal imports owes more

to the turnaround in availability of copper

scrap.

Scrap impacts the supply chain in two

ways, both negative for refined metal

demand.

Firstly, greater scrap supply means higher

production of refined copper by those refiner-

ies capable of handling it as a raw material

feed.

The International Copper Study Group

(ICSG) estimates that global production of

refined copper rose by around 2% in January.

Production using concentrates as a feed

was flat, while production from scrap rose by

13% year-on-year.

“Increased availability of scrap allowed

world secondary refined production to

increase, notably in China where the upward

trend started in 4th quarter 2016,” the Group

said in its most recent monthly update.

Secondly, and perhaps even more

importantly, the combination of improved

supply and cheaper pricing incentivises many

product manufacturers to increase scrap in

their input mix, reducing the need for refined

copper.

The resulting softness in refined metal

import demand is being compounded by

continued robust “exports” of copper.

These come from a clutch of producers

permissioned to toll-treat raw materials and

export refined copper without paying the

15-percent export tax.

The first-quarter export tally was 105,000

tonnes, compared with just 43,000 tonnes in

the same period of 2016.

Not all of these “exports” necessarily leave

the country.

China’s customs department counts a ship-

ment as an export even if the metal only goes

as far as a bonded warehouse zone in one of

the country’s ports.

At times last year there seemed to be a

fairly clear linkage between China’s outbound

flows and arrivals at LME warehouses in Asia.

The picture has become much murkier

with the most recent high-volume deliveries

into the LME’s Asian network taking place at

Singapore, to which China has exported only

a modest 5,000 tonnes so far this year.

A long-running theme of China’s trade in

copper is that it often says as much about

supply as it does about the country’s underly-

ing demand.

The emergence of scrap as a significant

supply source is accentuating that theme at

the moment.

However, it will not last.

By its very nature this sort of price-related

destock of scrap is a one-off phenomenon

and most copper analysts are looking for a

steady diminution over the coming months.

To what extent that translates into a

recovery in refined copper imports by China

remains to be seen.

Much will depend on the state of play in the

concentrates part of the supply chain.

Mine supply has taken some big hits in the

early months of this year but it has evidently

not yet impacted China’s ability to make more

refined copper itself.

Production was up by 8.5% in March and

not all of that increase is attributable to scrap.

Smelters have probably been drawing on

stocks accumulated last year in what turned

out to be a boom year for mine production.

They, like everyone else in the copper

market, will be paying close attention to what

happens with mine supply over the rest of

this year.

Andy Home is a columnist for Reuters. The

opinions expressed are those of the author.

BUSINESS

Gulf Times Friday, April 28, 20176

Takata shares plunge 20% on bankruptcy reportAFPTokyo

Takata shares dropped nearly 20% yesterday after a media report said the embattled Japanese air-

bag maker was considering fi ling for bankruptcy protection and then rolling its key businesses into a new company.

The stock price fell 19.53% to ¥412 ($3.70) — the daily limit loss of ¥100— after the Tokyo Stock Exchange lifted a trading suspension in the afternoon.

Trading in Takata’s shares was tem-porarily halted yesterday after Japan’s Nikkei business daily reported on a scheme to split the company.

Takata, at the centre of the biggest-ever auto safety recall, acknowledged that discussions were under way, but said no fi nal decisions have been made.

It declined to comment on details of the report in the Nikkei.

Takata has already agreed to pay a billion-dollar fi ne to settle lawsuits in the United States over its defective air-bags, which have been linked to at least 16 deaths and scores of injuries globally.

Yesterday, the Nikkei said Takata was considering fi ling for bankruptcy pro-tection and then selling its core opera-tions, including airbags, seat belts and child safety seats, to a new company created for the purpose of acquiring those divisions.

An external committee charged with formulating a plan for Takata’s rescue in February recommended Key Safety Systems (KSS), a US subsidiary of Chi-na’s Ningbo Joyson Electronic, as its turnaround sponsor, the Nikkei said.

“It’s true there are talks under way about how to rehabilitate the company, primarily among automakers and KSS, but we haven’t received a report from the external committee yet,” the com-

pany said in a statement yesterday.“We do not have any decision or rel-

evant facts to disclose.”Key Safety would put up nearly

¥200bn ($1.79bn) to create the new company that would purchase Takata

operations, the Nikkei said. That would let the stripped-down auto parts maker use the proceeds of the sale to repay creditors, including major automakers, for expenses linked to the massive recall of its airbags, the paper said without

citing sources. Takata would eventually be liquidated, it added.

Top creditors of Takata, including Honda and Toyota, broadly agree on the plan, the Nikkei said.

Japanese automakers would agree not

to pursue Key Safety or its future sub-sidiary for future recall costs, the article said.

The recall of more than 100mn air-bags has aff ected almost every major automaker.

Globalised yuan is long-term, market-driven goal: PBoCBloombergBeijing

People’s Bank of China’s depu-ty governor Fan Yifei said the country’s commitment to yuan

internationalisation is long-term, and policy makers will keep pushing to-wards that objective.

Boosting the currency’s global role is a market-driven process and a nat-ural result of China’s fi nancial open-ing, Fan said in a speech yesterday in Sydney, according to a statement re-leased on the central bank’s website. He said policy makers are confi dent in maintaining fi nancial stability and achieving their full-year economic growth goal of around 6.5%.

The quest for a globalised yuan has been undermined as authorities tightened controls to help curb capi-tal fl owing out of the country after the yuan last year posted its steepest de-cline in more than two decades. Swift data show global transactions using yuan fell to 1.78% in March, down from a record 2.79% share in August 2015. While outfl ows are easing for now, loosening the control too quickly

could fuel future risks. Fan said a dig-ital currency backed by the central bank has the potential to exert a nega-tive impact on fi nancial stability and security, which makes it important for policy makers to conduct further research on the topic. Meanwhile, the central bank should also step up oversight of private cryptocurrencies, he told a gathering of the RMB Global Cities Dialogue.

The central bank is among the fi rst working to create its own digital mon-ey, conducting trial runs of a proto-type earlier this year. Fan is one of the key PBoC offi cials leading the eff ort.

Reserve Bank of Australia gover-nor Philip Lowe, speaking at the same forum on yuan internationalisation, said China should be wary of the mes-sage investors take from capital curbs as they may be interpreted as concern about the economy.

“One consideration is the signal that a tightening of controls, after several years of liberalisation, could send to investors about how the gov-ernment perceives the balance of risks facing the economy,” Lowe said in a speech text prepared for delivery to the forum.

Asia stock markets rise on NAFTA deal hopes

AFPTokyo

Asian markets mostly rebound-

ed yesterday as the US said

it would renegotiate its free-

trade deal with Canada and

Mexico, dampening fears of

a trade war after reports said

President Donald Trump was

considering leaving the pact.

Europe’s major bourses

meanwhile drifted lower in

late morning trade before the

latest interest rate call from

the European Central Bank at

1145 GMT.

Equities across Asia started

the day in the red, following

four days of gains, as traders

assessed the chances of US

Congress passing massive tax

cuts unveiled Wednesday.

The White House said all

three countries would revise

the 22-year-old North Ameri-

can Free Trade Agreement

(NAFTA) swiftly.

The news has fuelled relief

on trading floors as President

Trump has previously hit out

at the agreement — calling

it a “disaster” that has killed

American jobs — as well as

other deals the US has signed

globally.

Jitters about a possible

trade war were heightened

this week when Washington

slapped 20% tariff s on Cana-

dian softwood lumber imports.

“It is my privilege to bring

NAFTA up to date through

renegotiation,” Trump said

in a White House statement.

“I believe that the end result

will make all three countries

stronger and better.”

Tokyo stocks fell 0.2% after

a four-day rally, with dealers

unmoved by the Bank of Ja-

pan’s decision to lower its infla-

tion target and stand pat on its

monetary easing programme.

But Hong Kong climbed

0.5% for a sixth-straight gain,

while Sydney added 0.2% and

Shanghai ended 0.4% higher.

The White House unveiled

plans to slash corporate and

individual rates on Wednesday

but there were few details and

several questions over how the

measures will be paid for.

The proposals are part of a

wide-ranging plan to fire the

world’s top economy, which

also includes ramping up infra-

structure spending and wiping

away business regulations.

“Under the Trump plan, we

will have a massive tax cut for

businesses and massive tax

reform and simplification,”

US Treasury Secretary Steven

Mnuchin said.

Stephen Innes, analyst at

trading firm Oanda, said that

no comprehensive details were

provided.

“Traders are viewing (the

plan) as little more than a road

map, rather than.... a big an-

nouncement,” he noted.

Investors in New York were

unsure about the measures

and decided to cash out after

two days of gains.

Turkish assets outperform EMsReutersLondon

The Turkish lira rallied to four-month highs yes-terday after a surprise policy tightening deci-sion reassured investors about the central bank’s

resolve on infl ation, while Mexico’s peso rose after US comments on the NAFTA trade deal.

The lira strengthened 0.5% towards its fi rmest level since January after the central bank hiked the highest of its multiple interest rates on Wednesday in an attempt to rein in double-digit infl ation.

Annual infl ation soared to 11.29% last month, its highest in 8-1/2 years, as currency weakness stoked a surge in food and transport prices.

The latest hike and liquidity measures are expected to raise the weighted average cost of funding by 25 basis points to 11.75%.

But it may also reassure investors that the central bank may be able to tackle infl ation without govern-ment interference.

“The move was surprising in the sense as it came at a time of relative stability in the lira given that the cen-tral bank seems to generally respond to lira weakness,” said Inan Demir, senior emerging market economist at Nomura. “But it might still have a defensive ele-ment given that we will see next week the April infl a-tion release... and Wednesday’s hike may be aiming to preempt that infl ation increase and preempt an erosion of real rates into negative territory.” He predicted infl a-tion would rise to 12%. JPMorgan told clients the move

had injected “a signifi cant dose of confi dence” which could spark a more durable rally in local currency as-sets, adding it was moving to an overweight position in lira and Turkish local bonds in its model portfolio.

Local 10-year sovereign bond yields fell to the low-est since November 2016 while fi ve-year credit default swaps eased to 212 basis points, their tightest in 21 months.

The average yield spread paid by Turkish sovereign bonds over US Treasuries on the JPMorgan EMBI Glo-bal Diversifi ed index also narrowed 1 basis point to 291 basis points, the lowest level since July 2016.

Mexico’s peso, which had slumped 1.75% on Wednesday on reports that the United States was considering withdrawing from the North American Free Trade Agreement (NAFTA), rose 1% as President Donald Trump said he would not immediately scrap the pact. A disruption in trade could wreak havoc in the auto sector and other industries, hitting profi ts at companies that have benefi ted from zero-level tariff s and Mexico’s relatively low labour costs.

Emerging currencies were also supported more broadly by the lack of specifi cs in Trump’s long-await-ed US tax cut plan, which many fear will be diffi cult to achieve and which weighed on the dollar.

Russia’s rouble gained 0.3%.Investors will be looking to an ECB interest rate deci-

sion later in the day and will scrutinise policymakers’ comments for any clues on whether it will start to pare monetary stimulus in the coming months. The rally in emerging market equities ran out of steam, with MS-CI’s benchmark emerging stocks index down 0.2%.

The logo of Takata Corp is seen at a showroom for vehicles in Tokyo. Shares in the company fell 19.53% to ¥412 ($3.70) after the Tokyo Stock Exchange lifted a trading suspension in the afternoon.

People’s Bank of China’s deputy governor Fan Yifei said the country’s commitment to yuan internationalisation is long-term, and policy makers will keep pushing towards that objective.

Indian equities fall fromrecord high; rupee steadyBloombergMumbai

India’s benchmark equity index fell from a record as shares of metal makers declined on the day monthly derivatives contracts expire.The S&P BSE Sensex index fell 0.3%, still closing above 30,000 mark at the 3:30pm close in Mumbai. The index fluctuated repeatedly between gains and losses as the April series of derivatives contracts expire on the last Thursday of every month and investors roll over positions to the next month. The NSE Nifty 50 Index dropped 0.1%.“Expiry-led volatility will dominate the market today before investors refocus on the earnings,” said Jagannadham Thunuguntla, head of fundamental equity research at Karvy Stock Broking Ltd. “It is a recovery quarter and the first one after demonetisation, so company numbers will remain crucial.”

Drugmaker Lupin Ltd declined 2.5%, the most on Sensex. Private lender HDFC Bank Ltd was the best performer, rising 1.3% to close at a record for the fifth straight day, after fourth-quarter net income released on April 21 matched estimates.The S&P BSE Metal Index dropped 1%, the biggest decliner among the 13 sector gauges compiled by BSE. The India VIX Index, a gauge of expected stock-price swings, dropped 5.7% to the lowest level on record, a day after rising 5.2%.Meanwhile, the rupee washed out initial gains to quote steady at 64.11 against the dollar in late morning trade on fresh demand for the greenback from banks and importers despite its weakness in overseas market. The rupee resumed higher at 64.05 per dollar as against Wednesday’s closing level of 64.11 at the Interbank Foreign Exchange (Forex) Market and firmed up further to 63.97 on initial selling of dollars.

LATEST MARKET CLOSING FIGURES

Zad Holding CoWidam Food CoVodafone Qatar

United Development CoSalam International Investme

Qatar & Oman Investment CoQatar Navigation

Qatar National Cement CoQatar National Bank

Qatar Islamic InsuranceQatar Industrial Manufactur

Qatar International IslamicQatari Investors Group

Qatar Islamic BankQatar Gas Transport(Nakilat)Qatar General Insurance & ReQatar German Co For Medical

Qatar Fuel QscQatar First Bank

Qatar Electricity & Water CoQatar Cinema & Film Distrib

Qatar Insurance CoOoredoo Qsc

National LeasingMazaya Qatar Real Estate Dev

Mesaieed Petrochemical HoldiAl Meera Consumer Goods Co

Medicare GroupMannai Corporation Qsc

Masraf Al RayanAl Khalij Commercial Bank

Industries QatarIslamic Holding Group

Gulf Warehousing CompanyGulf International Services

Ezdan Holding GroupDoha Insurance Co

Doha Bank QscDlala Holding

Commercial Bank QscBarwa Real Estate Co

Al Khaleej Takaful GroupAamal Co

74.60

64.00

9.43

19.19

10.50

9.53

70.50

75.60

143.80

60.90

43.45

62.80

57.00

101.00

19.90

39.10

9.39

128.00

8.55

208.00

35.90

71.00

103.80

17.22

12.65

14.95

156.90

97.00

78.50

41.85

14.63

104.30

61.00

52.50

25.60

15.30

16.84

31.30

25.00

29.95

34.00

20.00

13.26

-6.75

-0.62

-1.15

-2.04

-0.47

0.21

-0.42

-1.56

-2.18

1.50

0.81

-0.63

-1.72

0.00

-0.50

0.00

1.40

-3.03

-1.27

-0.95

0.00

0.00

-1.42

-0.63

-5.39

1.15

-0.70

-1.72

0.00

0.00

0.21

-2.98

-2.87

0.57

-0.58

-0.65

1.45

-0.79

2.75

0.50

-0.58

4.71

-3.56

1,616

8,739

2,030,714

146,612

67,175

9,085

18,228

1,633

312,074

301

1,276

84,612

126,853

42,027

228,283

-

78,867

147,877

288,912

27,026

-

37,591

74,035

802,110

1,237,315

334,875

7,611

26,892

205

356,530

8,760

172,968

36,877

48,706

89,394

1,394,435

1,000

211,753

658,009

527,994

208,670

652

37,640

QATAR

Company Name Lt Price % Chg Volume

United Wire Factories CompanEtihad Etisalat Co

Dar Al Arkan Real Estate DevSaudi Hollandi Bank

Rabigh Refining And PetrocheBanque Saudi Fransi

Saudi Enaya Cooperative InsuMediterranean & Gulf Insuran

Saudi British BankMohammad Al Mojil Group Co

Red Sea International CoTakween Advanced Industries

Sabb TakafulSaudi Arabian Fertilizer Co

National GypsumSaudi Ceramic Co

National Gas & IndustrializaSaudi Pharmaceutical Industr

ThimarNational Industrialization C

Saudi Transport And InvestmeSaudi Electricity Co

Saudi Arabia Refineries CoArriyadh Development Company

Al-Baha Development & InvestSaudi Research And MarketingAldrees Petroleum And Transp

Saudi Vitrified Clay Pipe CoJarir Marketing Co

Arab National BankYanbu National Petrochemical

Arabian CementMiddle East Specialized Cabl

Al Khaleej Training And EducAl Sagr Co-Operative Insuran

Trade Union Cooperative InsuArabia Insurance Cooperative

Saudi Chemical CompanyFawaz Abdulaziz Alhokair & C

Bupa Arabia For CooperativeWafa Insurance

Jabal Omar Development CoSaudi Basic Industries Corp

Saudi Kayan Petrochemical CoEtihad Atheeb Telecommunicat

Co For Cooperative InsuranceNational Petrochemical Co

Gulf Union Cooperative InsurGulf General Cooperative Ins

Basic Chemical IndustriesSaudi Steel Pipe Co

Buruj Cooperative InsuranceMouwasat Medical Services Co

Southern Province Cement CoMaadaniyah

Yamama Cement CoJazan Development Co

Zamil Industrial InvestmentAlujain Corporation (Alco)

Tabuk Agricultural DevelopmeUnited Co-Operative Assuranc

Qassim Cement/TheSaudi Advanced Industries

Kingdom Holding CoSaudi Arabian Amiantit Co

Al Jouf Agriculture DevelopmSaudi Industrial Development

Bishah AgricultureRiyad Bank

The National Agriculture DevHalwani Bros Co

Arabian Pipes CoEastern Province Cement Co

Al Gassim Investment HoldingFiling & Packing Materials M

Saudi Cable CoTihama Advertising & Public

Saudi Investment Bank/TheAstra Industrial Group

Saudi Public Transport CoTaiba Holding Co

Saudi Industrial Export CoSaudi Real Estate Co

Saudia Dairy & Foodstuff CoNational Shipping Co Of/The

Methanol Chemicals CoAce Arabia Cooperative Insur

Mobile Telecommunications CoSaudi Arabian Coop Ins Co

Axa Cooperative InsuranceAlsorayai Group

Weqaya For Takaful InsuranceBank Albilad

Al-Hassan G.I. Shaker CoWataniya Insurance Co

Abdullah Al Othaim MarketsHail Cement

20.83

20.57

6.71

0.00

13.83

26.20

16.52

20.19

22.59

12.55

25.61

12.12

27.62

68.80

13.56

28.59

34.20

34.45

34.13

16.39

0.00

22.96

33.60

20.57

13.50

27.60

26.42

58.63

136.23

19.65

55.59

35.80

7.00

18.60

37.40

19.36

12.80

33.15

34.04

116.55

13.79

67.24

95.98

8.88

8.80

96.00

19.45

12.28

16.90

25.00

16.18

31.63

143.12

56.48

23.00

17.74

14.20

30.00

23.71

12.00

13.03

49.80

13.65

10.50

6.70

30.73

11.88

69.75

10.33

31.07

49.39

15.98

27.27

0.00

34.55

5.75

40.76

12.69

16.39

14.99

44.40

31.22

20.88

126.03

35.63

7.04

47.86

10.35

22.98

23.05

9.40

19.39

18.69

15.52

28.38

105.75

10.80

1.12

0.05

1.51

0.00

2.14

0.11

-0.84

0.40

-1.27

0.00

-0.31

0.17

0.47

-0.01

0.00

0.70

0.80

-0.38

-1.16

2.31

0.00

-0.22

0.60

0.34

0.00

0.25

1.38

1.97

0.54

0.05

-0.18

0.00

4.17

0.59

0.54

0.16

0.39

0.45

-2.49

0.82

-4.77

0.36

1.34

1.02

-1.12

0.26

0.26

-0.16

1.20

-0.16

0.19

0.25

-0.28

2.69

0.44

0.80

-0.35

1.35

1.15

0.00

2.12

0.00

0.89

0.86

1.36

0.82

0.00

0.00

0.29

-1.71

1.21

1.20

0.26

0.00

0.29

0.00

-0.61

-0.08

0.61

0.33

0.54

0.26

0.68

0.37

0.08

0.28

-1.20

0.68

0.66

0.88

0.43

0.00

0.59

-1.15

0.96

0.00

-0.37

850,050

1,278,229

89,400,522

-

4,416,862

105,842

111,878

108,137

628,498

-

66,880

300,997

237,132

148,447

28,704

69,307

9,859

62,862

128,992

673,751

-

1,164,058

107,465

75,909

-

116,734

341,254

17,132

42,213

86,690

384,673

74,239

2,067,152

105,831

105,318

89,526

420,630

38,425

1,195,197

69,155

2,079,359

38,294

4,534,377

12,479,075

322,451

106,601

118,081

96,065

191,415

278,236

59,926

369,341

2,197

61,623

158,344

439,366

396,515

69,537

1,143,651

765,441

474,586

38,545

264,110

109,921

853,036

112,177

379,338

-

260,208

697,081

25,743

252,918

19,586

-

80,764

-

526,570

196,406

98,531

1,100,938

27,354

136,320

384,313

111,722

185,683

1,842,703

370,922

4,379,518

360,291

745,026

501,619

-

297,421

169,561

250,699

11,213

150,259

SAUDI ARABIA

Company Name Lt Price % Chg Volume

Saudi Re For Cooperative ReiSolidarity Saudi Takaful Co

Amana Cooperative InsuranceAlabdullatif Industrial Inv

Saudi Printing & Packaging CSanad Cooperative Insurance

Saudi Paper Manufacturing CoAlinma Bank

Almarai CoFalcom Saudi Equity Etf

United International TranspoHsbc Amanah Saudi 20 Etf

Saudi International PetrocheFalcom Petrochemical Etf

Saudi United Cooperative InsBank Al-Jazira

Al Rajhi BankSamba Financial Group

United Electronics CoAllied Cooperative Insurance

Malath InsuranceAlinma Tokio Marine

Arabian Shield CooperativeSavola

Wafrah For Industry And DeveFitaihi Holding Group

Tourism Enterprise Co/ ShamsSahara Petrochemical Co

Herfy Food Services Co

7.50

17.97

18.73

13.90

16.50

15.23

8.21

14.36

73.08

27.50

22.80

27.70

17.33

26.70

28.68

11.71

63.11

21.40

36.86

13.04

21.29

17.34

53.14

42.51

22.72

12.36

30.08

14.46

80.00

0.00

0.73

-1.00

-0.71

0.30

0.00

1.99

0.98

0.69

-0.72

0.00

0.00

2.85

0.00

0.35

0.60

0.33

0.94

-3.08

-1.58

-0.19

1.58

-1.32

0.33

0.04

-0.08

-0.10

-0.55

0.63

501,683

143,766

475,166

137,481

411,611

-

1,954,465

27,898,604

135,963

1,180

202,196

-

1,830,539

-

545,772

1,832,322

1,233,476

598,032

627,700

231,839

76,063

163,873

46,406

100,525

208,167

94,415

70,434

415,538

63,362

SAUDI ARABIA

Company Name Lt Price % Chg Volume

Securities Group CoSultan Center Food Products

Kuwait Foundry Co SakKuwait Financial Centre Sak

Ajial Real Estate EntmtGulf Glass Manuf Co -Kscc

Kuwait Finance & InvestmentNational Industries Co Ksc

Kuwait Real Estate Holding CSecurities House/The

Boubyan Petrochemicals CoAl Ahli Bank Of Kuwait

Ahli United Bank (Almutahed)National Bank Of Kuwait

Commercial Bank Of KuwaitKuwait International Bank

Gulf BankAl-Massaleh Real Estate Co

Al Arabiya Real Estate CoKuwait Remal Real Estate Co

Alkout Industrial Projects CA’ayan Real Estate Co Sak

Investors Holding Group Co.KAl-Mazaya Holding Co

Al-Madar Finance & Invt CoGulf Petroleum Investment

Mabanee Co SakcCity Group

Inovest Co BscKuwait Gypsum Manufacturing

Al-Deera Holding CoAlshamel International Hold

Mena Real Estate CoNational Slaughter House

Amar Finance & Leasing CoUnited Projects For Aviation

National Consumer Holding CoAmwal International Investme

Jeeran HoldingsEquipment Holding Co K.S.C.C

Nafais HoldingSafwan Trading & Contracting

Arkan Al Kuwait Real EstateGfh Financial Group Bsc

Energy House Holding Co KscpKuwait Slaughter House Co

Kuwait Co For Process PlantAl Maidan Dental Clinic Co K

National Ranges CompanyAl-Themar Real International

Al-Ahleia Insurance Co SakpWethaq Takaful Insurance Co

Salbookh Trading Co KscpAqar Real Estate Investments

Hayat CommunicationsKuwait Packing Materials Mfg

Soor Fuel Marketing Co KscAlargan International RealBurgan Co For Well Drilling

Kuwait Resorts Co KsccOula Fuel Marketing Co

Palms Agro Production CoIkarus Petroleum Industries

Mubarrad Transport CoAl Mowasat Health Care Co

Shuaiba Industrial CoHits Telecom Holding

First Takaful Insurance CoKuwaiti Syrian Holding Co

National Cleaning CompanyEyas For High & Technical EdUnited Real Estate Company

AgilityKuwait & Middle East Fin Inv

Fujairah Cement IndustriesLivestock Transport & Tradng

International Resorts CoNational Industries Grp Hold

Marine Services Co KscWarba Insurance Co

Kuwait United Poultry CoFirst Dubai Real Estate Deve

Al Arabi Group Holding CoKuwait Hotels Sak

Mobile Telecommunications CoAl Safat Real Estate Co

Tamdeen Real Estate Co KscAl Mudon Intl Real Estate Co

Kuwait Cement Co KscSharjah Cement & Indus Devel

Kuwait Portland Cement CoEducational Holding Group

Bahrain Kuwait InsuranceAsiya Capital Investments Co

Kuwait Investment CoBurgan Bank

Kuwait Projects Co HoldingsAl Madina For Finance And In

Kuwait Insurance CoAl Masaken Intl Real Estate

Intl Financial AdvisorsFirst Investment Co Kscc

Al Mal Investment CompanyBayan Investment Co Kscc

Egypt Kuwait Holding Co SaeCoast Investment Development

Privatization Holding CompanKuwait Medical Services Co

Injazzat Real State CompanyKuwait Cable Vision Sak

Sanam Real Estate Co KsccIthmaar Holding Bsc

Aviation Lease And Finance CArzan Financial Group For Fi

Ajwan Gulf Real Estate CoKuwait Business Town Real Es

Future Kid Entertainment AndSpecialities Group Holding C

Abyaar Real Eastate DevelopmDar Al Thuraya Real Estate C

Al-Dar National Real EstateKgl Logistics Company Kscc

Combined Group ContractingZima Holding Co Ksc

Qurain Holding Co

99.00

67.00

290.00

106.00

170.00

0.00

51.00

214.00

43.00

48.50

580.00

310.00

430.00

680.00

390.00

248.00

248.00

53.00

37.00

73.00

700.00

88.00

26.00

124.00

0.00

45.50

800.00

0.00

106.00

95.00

36.50

335.00

0.00

40.00

57.00

740.00

90.00

71.00

44.50

60.00

150.00

0.00

84.00

188.00

45.50

188.00

174.00

0.00

28.50

90.00

480.00

54.00

66.00

82.00

85.00

0.00

124.00

188.00

85.00

81.00

124.00

110.00

0.00

79.00

310.00

315.00

46.00

56.00

40.50

49.00

400.00

90.00

620.00

31.50

90.00

204.00

36.50

122.00

60.00

92.00

0.00

60.00

94.00

0.00

440.00

0.00

425.00

46.50

490.00

90.00

960.00

305.00

0.00

38.00

100.00

305.00

415.00

49.50

248.00

75.00

44.00

49.00

20.00

51.00

192.00

45.50

52.00

0.00

93.00

0.00

55.00

51.00

250.00

38.00

82.00

53.00

124.00

90.00

27.00

204.00

0.00

68.00

540.00

58.00

0.00

0.00

0.00

0.00

0.00

4.94

0.00

5.15

0.00

1.18

-3.00

1.75

0.00

1.18

1.49

5.41

0.00

0.00

6.00

2.78

2.82

0.00

2.33

0.00

3.33

0.00

1.11

-2.44

0.00

0.00

0.00

2.82

0.00

0.00

0.00

0.00

7.25

0.00

0.00

-1.11

3.45

0.00

0.00

0.00

2.17

3.41

0.00

0.00

0.00

-1.72

0.00

0.00

5.88

-1.49

0.00

1.19

0.00

0.00

0.00

-5.56

1.25

0.00

5.77

0.00

0.00

0.00

-10.00

3.37

-3.45

1.25

-1.01

0.00

-5.26

0.00

5.00

0.00

0.00

1.39

1.67

0.00

5.75

0.00

3.45

-2.08

0.00

-1.12

0.00

0.00

1.09

0.00

0.00

0.00

3.39

0.00

-1.30

-1.96

-1.61

0.00

5.32

0.00

-3.85

3.53

0.00

-4.76

6.25

0.00

1.11

0.00

0.00

0.00

0.00

0.00

4.08

0.00

1.33

-1.20

3.92

0.00

1.12

1.89

0.00

0.00

1.49

-1.82

1.75

0.00

419

379,176

11,000

65,005

10,050

-

4,850

102

2,129,699

7,297,153

67,054

5

25,010

3,278,284

10,381

97,000

601,500

1,266,910

2,707,661

2,687,720

1,000

479,252

1,177,015

15,996,346

-

3,358,555

271,511

-

2,515,580

100

38,501

250

-

6,404

500

100

78,300

500

1,000

4,563,342

5,008

-

10,050

84,314

38,650

5,000

941

-

1,004,010

400,000

8,860

100

32,055

10,000

87,330

-

35,804

50

43,451

920,000

21,711

50

-

15,105

20

30,753

6,834,417

24,010

1,719,000

89,296

40,000

5,050

431,771

52,750

77,200

3,000

898,500

325,909

7,000

812

-

3,022,561

745,015

-

1,480,899

-

39,799

2,676,413

73

290,000

1,500

11,710

-

196,937

505,000

481,053

397,877

1,522,800

6,394

60,000

5,158,242

48,200

3,789,524

16,365,645

95,000

778,600

760

-

6,000

-

15

22,178,460

286,000

3,440,804

255,000

2,216,232

505

301,011

10,021,232

10

-

153,816

235,957

121,230

-

KUWAIT

Company Name Lt Price % Chg Volume

Voltamp Energy SaogUnited Power/Energy Co- Pref

United Power Co SaogUnited Finance Co

Ubar Hotels & ResortsTakaful Oman

Taageer FinanceSweets Of OmanSohar Power Co

Sohar PoultrySmn Power Holding Saog

Shell Oman Marketing - PrefShell Oman Marketing

Sharqiyah Desalination Co SaSembcorp Salalah Power & Wat

Salalah Port ServicesSalalah Mills Co

Salalah Beach Resort SaogSahara Hospitality

Renaissance Services SaogRaysut Cement Co

Port Service CorporationPhoenix Power Co Saoc

Packaging Co LtdOoredoo

OminvestOman United Insurance Co

Oman Textile Holding Co SaogOman Telecommunications Co

Oman Refreshment CoOman Packaging

Oman Orix Leasing Co.Oman Oil Marketing Company

Oman National Engineering AnOman Investment & Finance

Oman Intl MarketingOman Hotels & Tourism CoOman Foods International

Oman Flour MillsOman Fisheries CoOman Fiber Optics

Oman Europe Foods IndustriesOman Education & Training In

Oman ChromiteOman Chlorine

Oman Ceramic CompanyOman Cement Co

Oman Cables IndustryOman Agricultural Dev

Oman & Emirates Inv(Om)50%Natl Aluminium Products

National SecuritiesNational Real Estate Develop

National PharmaceuticalNational Mineral Water

National Hospitality InstituNational Gas Co

National Finance CoNational Detergent Co Saog

National Biscuit IndustriesNational Bank Of Oman Saog

Muscat Thread Mills CoMuscat National Holding

Muscat Gases Company SaogMuscat Finance

Majan Glass CompanyMajan College

Hsbc Bank OmanHotels Management Co Interna

Gulf StoneGulf Plastic Industries Co

Gulf Mushroom CompanyGulf Investments Services

Gulf Invest. Serv. Pref-SharGulf International Chemicals

Gulf Hotels (Oman) Co LtdGlobal Fin Investment

Galfar Engineering&ContractGalfar Engineering -Prefer

Financial Services Co.Financial Corp/The

Dhofar UniversityDhofar Tourism

Dhofar PoultryDhofar Intl Development

Dhofar InsuranceDhofar Fisheries & Food Indu

Dhofar CattlefeedDhofar Beverages Co

Construction Materials IndComputer Stationery Inds

Bankmuscat SaogBank SoharBank Nizwa

Bank Dhofar Saog

0.46

1.00

3.25

0.14

0.13

0.18

0.11

1.34

0.17

0.21

0.70

1.05

1.88

4.35

0.25

0.63

1.39

1.38

2.50

0.22

1.15

0.23

0.14

2.21

0.52

0.51

0.38

0.75

1.32

2.16

0.28

0.12

1.66

0.15

0.22

0.52

0.40

0.00

0.93

0.14

0.00

1.00

0.15

3.64

0.49

0.42

0.46

1.65

0.00

0.12

0.16

0.05

5.00

0.11

0.05

0.00

0.42

0.15

0.66

3.75

0.23

0.08

0.86

0.56

0.12

0.19

0.51

0.13

1.25

0.12

0.00

0.31

0.11

0.11

0.24

10.50

0.17

0.08

0.39

0.11

0.10

1.49

0.49

0.18

0.29

0.21

1.28

0.19

0.26

0.03

0.26

0.40

0.15

0.09

0.23

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

1.23

0.00

0.00

0.00

0.00

0.00

0.44

0.00

1.44

0.00

0.00

0.00

0.00

0.00

0.77

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

2.88

0.00

0.00

0.00

0.00

0.00

0.00

0.88

0.00

0.00

-0.86

-0.61

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.95

0.00

0.00

0.00

0.00

-1.27

0.00

0.00

0.00

0.00

0.00

0.00

-2.00

0.00

0.00

0.00

0.00

0.00

0.00

0.50

1.33

-1.06

0.00

2,723

-

-

-

-

-

-

-

-

-

-

-

-

-

122,402

-

-

-

-

-

80,000

396,835

594,966

-

-

75,652

250,000

-

325,723

-

1,278

-

-

-

-

-

-

-

75,000

1,671,378

-

-

-

-

-

-

50,000

-

-

11,609

7,100

-

-

-

-

-

-

-

-

-

65,000

-

-

-

3,026,200

-

-

-

-

-

-

120

10,000

-

-

-

-

419,790

-

-

-

-

-

-

104,948

-

-

-

-

-

-

593,876

1,866,366

202,002

460,270

OMAN

Company Name Lt Price % Chg Volume

Areej Vegetable Oils SaocAloula Co

Al-Omaniya Financial ServiceAl-Hassan Engineering Co

Al-Fajar Al-Alamia CoAl-Anwar Ceramic Tiles Co

Al Suwadi PowerAl Shurooq Inv Ser

Al Sharqiya Invest HoldingAl Maha Petroleum Products M

Al Maha Ceramics Co SaocAl Madina Takaful Co Saoc

Al Madina Investment CoAl Kamil Power Co

Al Jazerah Services -PfdAl Jazeera Steel Products Co

Al Jazeera ServicesAl Izz Islamic Bank

Al Buraimi HotelAl Batinah PowerAl Batinah Hotels

Al Batinah Dev & InvAl Anwar Holdings Saog

Ahli BankAcwa Power Barka Saog

Abrasives Manufacturing Co SA’saff a Foods Saog

0Man Oil Marketing Co-Pref

0.00

0.53

0.28

0.05

0.75

0.15

0.18

1.04

0.11

1.44

0.40

0.10

0.07

0.31

0.55

0.26

0.17

0.07

0.88

0.17

1.13

0.09

0.21

0.19

0.79

0.05

0.59

0.25

0.00

0.00

0.00

0.00

0.00

0.69

0.00

0.00

0.00

0.00

-0.50

0.00

-1.47

0.00

0.00

2.76

3.13

-1.43

0.00

0.00

0.00

0.00

0.98

0.00

0.00

0.00

0.00

0.00

-

-

-

-

-

614,845

1,686,363

-

10,279

-

115,910

1,747,529

60,063

-

-

2,596,101

104,169

247,358

-

-

-

-

1,131,352

-

43,000

-

-

-

OMAN

Company Name Lt Price % Chg Volume

Waha Capital PjscUnited Insurance Company

United Arab Bank PjscUnion National Bank/Abu Dhab

Union Insurance CoUnion Cement Co

Umm Al Qaiwain Cement IndustSharjah Islamic Bank

Sharjah Insurance CompanySharjah Group

Sharjah Cement & Indus DevelRas Al-Khaimah National Insu

Ras Al Khaimah White CementRas Al Khaimah Ceramics

Ras Al Khaimah Cement Co PscRas Al Khaima Poultry

Rak PropertiesOoredoo Qsc

Oman & Emirates Inv(Emir)50%Nbad Oneshare Msci Uae Ucits

National Takaful CompanyNational Marine Dredging Co

National Investor Co/TheNational Corp Tourism & Hote

National Bank Of Umm Al QaiwNational Bank Of Ras Al-Khai

National Bank Of FujairahNational Bank Of Abu Dhabi

Methaq Takaful InsuranceManazel Real Estate Pjsc

Invest BankIntl Fish Farming Co Pjsc

Insurance HouseGulf Pharmaceutical Ind Psc

Gulf Medical ProjectsGulf Cement Co

Fujairah Cement IndustriesFujairah Building Industries

Foodco Holding PjscFirst Gulf BankFinance House

Eshraq Properties Co PjscEmirates Telecom Group Co

Emirates Insurance Co. (Psc)Emirates Driving Company

Dana GasCommercial Bank Internationa

Bank Of SharjahAxa Green Crescent Insurance

Arkan Building Materials CoAlkhaleej InvestmentAldar Properties Pjsc

Al Wathba National InsuranceAl Khazna Insurance Co

Al Fujairah National InsuranAl Dhafra Insurance Co. P.S.

Al Buhaira National InsurancAl Ain Ahlia Ins. Co.

Agthia Group PjscAbu Dhabi Ship Building Co

Abu Dhabi Natl Co For BuildiAbu Dhabi National Takaful C

Abu Dhabi National InsuranceAbu Dhabi National Hotels

Abu Dhabi National Energy CoAbu Dhabi Islamic Bank

1.87

2.00

1.56

5.00

1.86

1.20

1.78

1.33

3.85

1.49

1.10

4.10

1.08

2.38

0.89

3.70

0.61

101.00

0.86

6.20

0.58

4.50

0.52

2.90

3.10

4.57

2.91

11.00

0.83

0.53

2.40

1.65

0.78

2.16

3.00

0.98

0.91

1.56

6.50

12.90

1.65

1.17

17.45

5.98

8.10

0.44

1.75

1.43

0.73

0.70

1.20

2.14

12.75

0.40

300.00

3.85

2.20

50.00

6.25

2.72

0.54

5.15

3.00

3.00

0.60

3.58

0.54

0.00

0.00

-1.96

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

3.48

1.14

0.00

0.00

0.00

0.00

0.00

0.00

11.11

0.00

0.00

0.00

0.44

-9.35

0.46

0.00

0.00

0.00

-0.60

4.00

1.89

0.00

0.00

0.00

0.00

0.00

0.00

0.00

2.63

-2.24

0.00

0.00

0.00

0.00

0.00

0.00

6.06

0.00

-1.83

0.00

-2.44

0.00

0.00

0.00

0.00

-1.42

0.00

0.00

0.00

0.00

0.00

0.00

-0.56

79,171

-

-

1,912,299

-

-

-

-

-

-

-

-

-

172,868

11,500

-

1,800,716

-

-

-

-

699

-

-

-

75,588

14,512

4,851,634

983,750

1,842,343

-

762,296

200,000

47,781

-

-

-

-

-

10,031,354

-

40,916,659

784,582

-

-

8,720,996

-

-

-

2,826,062

-

7,907,956

-

83,084

-

-

-

-

792,957

-

-

-

-

215,772

542,341

244,577

UAE

Company Name Lt Price % Chg Volume

Zain Bahrain BsccUnited Paper Industries Bsc

United Gulf Investment CorpUnited Gulf BankTrafco Group Bsc

Takaful International CoTaib Bank -$Us

Seef PropertiesSecurities & Investment Co

National Hotels CoNational Bank Of Bahrain Bsc

Nass Corp BscKhaleeji Commercial Bank

Ithmaar Holding BscInvestcorp Bank -$Us

Inovest Co BscGulf Monetary Group

Gulf Hotel Group B.S.CGfh Financial Group Bsc

Esterad Investment Co B.S.C.Delmon Poultry Co

Bmmi BscBmb Investment Bank

Bbk BscBankmuscat Saog

Banader Hotels CoBahrain Tourism CoBahrain Telecom Co

Bahrain Ship Repair & EnginBahrain National Holding

Bahrain Kuwait InsuranceBahrain Islamic Bank

Bahrain Flour Mills CoBahrain Family Leisure Co

Bahrain Duty Free ComplexBahrain Commercial Facilitie

Bahrain Cinema CoBahrain Car Park Co

Arab Insurance Group(Bsc)-$Arab Banking Corp Bsc-$Us

Aluminium Bahrain BscAlbaraka Banking Group

Al-Salam BankAl-Ahlia Insurance Co

Ahli United Bank B.S.C

0.10

0.00

0.00

0.39

0.25

0.00

0.00

0.24

0.00

0.00

0.67

0.15

0.12

0.17

8.50

0.33

0.00

0.53

0.62

0.13

0.00

0.82

0.05

0.39

0.00

0.07

`

0.26

0.00

0.36

0.00

0.15

0.00

0.08

0.77

0.69

1.30

0.14

0.47

0.32

0.42

0.44

0.10

0.00

0.71

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.76

0.00

-2.44

0.00

0.00

0.00

0.00

2.94

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

-0.75

0.00

-5.26

0.00

3.57

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

-0.48

-1.12

1.02

0.00

-0.70

40,000

-

-

26,959

10,000

-

-

202,500

-

-

127,000

207,715

1,580,025

50,000

9,500

25,000

-

3,500

131,131

37,024

-

50,000

61,091,823

455,000

-

57,832

-

95,486

-

10,000

-

48,112

-

150,000

6,000

9,000

5,000

16,500

50,000

240,000

120,586

48,760

249,901

-

1,432,350

BAHRAIN

Company Name Lt Price % Chg Volume

Boubyan Intl Industries HoldGulf Investment House Ksc

Boubyan Bank K.S.CAhli United Bank B.S.C

Osos Holding Group CoAl-Eid Food Ksc

Qurain Petrochemical IndustrAdvanced Technology Co

Ekttitab Holding Co SakKout Food Group Ksc

Real Estate Trade Centers CoAcico Industries Co Kscc

Kipco Asset Management CoNational Petroleum ServicesAlimtiaz Investment Co Kscc

Ras Al Khaimah White CementKuwait Reinsurance Co Ksc

Kuwait & Gulf Link TransportHuman Soft Holding Co Ksc

Automated Systems Co KsccMetal & Recycling Co

Gulf Franchising Holding CoAl-Enma’a Real Estate Co

National Mobile TelecommuniAl Bareeq Holding Co Kscc

Housing Finance Co SakAl Salam Group Holding Co

United Foodstuff IndustriesAl Aman Investment Company

Mashaer Holdings Co KscManazel Holding

Mushrif Trading & ContractinTijara And Real Estate Inves

Kuwait Building MaterialsJazeera Airways Co Ksc

Commercial Real Estate CoFuture Communications Co

National International CoTaameer Real Estate Invest C

Gulf Cement CoHeavy Engineering And Ship B

Refrigeration Industries & SNational Real Estate Co

Al Safat Energy Holding CompKuwait National Cinema CoDanah Alsafat Foodstuff Co

Independent Petroleum GroupKuwait Real Estate Co Ksc

Salhia Real Estate Co KscGulf Cable & Electrical IndAl Nawadi Holding Co Ksc

Kuwait Finance HouseGulf North Africa Holding Co

Hilal Cement CoOsoul Investment Kscc

Gulf Insurance Group KscKuwait Food Co (Americana)

Umm Al Qaiwain Cement IndustAayan Leasing & Investment

21.50

43.50

405.00

214.00

138.00

0.00

340.00

1,100.00

40.00

0.00

47.00

290.00

93.00

1,560.00

168.00

98.00

194.00

60.00

3,780.00

265.00

76.00

63.00

41.50

1,260.00

0.00

0.00

50.00

0.00

49.00

0.00

57.00

0.00

58.00

156.00

560.00

76.00

0.00

65.00

43.00

77.00

232.00

0.00

106.00

42.00

1,400.00

88.00

400.00

58.00

380.00

440.00

0.00

495.00

38.50

208.00

63.00

550.00

2,460.00

0.00

50.00

0.00

3.57

0.00

-0.93

2.99

0.00

3.03

0.00

1.27

0.00

0.00

3.57

-1.06

-2.50

-2.33

0.00

0.00

-1.64

-2.58

-8.62

0.00

0.00

0.00

3.28

0.00

0.00

5.26

0.00

0.00

0.00

5.56

0.00

0.00

0.00

0.00

0.00

0.00

-1.52

6.17

-4.94

1.75

0.00

3.92

0.00

0.00

0.00

0.00

0.00

1.33

1.15

0.00

-1.00

0.00

0.00

1.61

0.00

0.00

0.00

1.01

1,000,850

2,841,677

360,783

2,096,965

22,687

-

299,566

5,025

3,346,640

-

128,350

27,646

76,452

25,920

8,316,260

210

500

74,000

764,578

26,550

23,705

51,020

905,350

5

-

-

4,326,019

-

2,900

-

32,693,225

-

24,096

45

154,823

508,211

-

70,507

13,879,010

182,110

20

-

1,870,881

2,444,934

6,004

938,500

4,959

22,600,169

31,000

78,048

-

944,552

387,709

14,842

30,010

500

15,002

-

3,848,382

KUWAIT

Company Name Lt Price % Chg Volume

BUSINESS7Gulf Times

Friday, April 28, 2017

Apple IncMicrosoft Corp

Exxon Mobil CorpJohnson & JohnsonGeneral Electric Co

Jpmorgan Chase & CoProcter & Gamble Co/The

Wal-Mart Stores IncVerizon Communications Inc

Pfizer IncVisa Inc-Class A Shares

Chevron CorpCoca-Cola Co/The

Intel CorpMerck & Co. Inc.

Cisco Systems IncHome Depot Inc

Intl Business Machines CorpWalt Disney Co/The

Unitedhealth Group Inc3M Co

Mcdonald’s CorpNike Inc -Cl B

United Technologies CorpBoeing Co/The

Goldman Sachs Group IncAmerican Express Co

Du Pont (E.I.) De NemoursCaterpillar Inc

Travelers Cos Inc/The

143.60

67.83

81.00

123.61

29.05

87.42

87.58

75.20

46.81

33.94

91.37

105.14

42.95

37.16

62.72

33.85

154.85

159.92

115.97

175.40

195.94

141.35

55.36

119.00

183.69

224.08

80.29

80.32

102.87

122.16

-0.06

0.00

-0.49

0.08

-0.72

-1.14

-0.18

-0.30

-1.17

0.27

-0.49

-0.89

-0.67

0.61

0.02

1.35

0.41

-0.09

0.34

0.58

0.48

0.36

0.35

0.68

1.09

-0.94

-0.29

-1.58

-1.72

0.12

6,191,780

11,589,059

5,406,103

1,661,017

12,880,796

6,323,970

4,361,390

2,465,182

6,928,371

6,364,614

2,333,186

2,241,061

4,862,367

11,553,685

2,170,891

11,069,626

1,735,359

1,504,951

1,611,935

1,139,503

599,515

2,359,240

4,216,007

1,332,349

1,277,428

1,304,572

1,192,551

2,212,311

3,236,023

549,371

DJIA

Company Name Lt Price % Chg Volume

Wpp PlcWorldpay Group Plc

Wolseley PlcWm Morrison Supermarkets

Whitbread PlcVodafone Group Plc

United Utilities Group PlcUnilever Plc

Tui Ag-DiTravis Perkins Plc

Tesco PlcTaylor Wimpey Plc

Standard Life PlcStandard Chartered Plc

St James’s Place PlcSse Plc

Smith & Nephew PlcSky Plc

Shire PlcSevern Trent Plc

Schroders PlcSainsbury (J) Plc

Sage Group Plc/TheSabmiller Plc

Rsa Insurance Group PlcRoyal Mail Plc

Royal Dutch Shell Plc-B ShsRoyal Dutch Shell Plc-A Shs

Royal Bank Of Scotland GroupRolls-Royce Holdings Plc

Rio Tinto PlcRexam Ltd

Relx PlcReckitt Benckiser Group Plc

Randgold Resources LtdPrudential Plc

Provident Financial PlcPersimmon Plc

Pearson PlcPaddy Power Betfair Plc

Old Mutual PlcNext Plc

National Grid PlcMondi Plc

Merlin EntertainmentMediclinic International Plc

Marks & Spencer Group PlcLondon Stock Exchange Group

Lloyds Banking Group PlcLegal & General Group PlcLand Securities Group Plc

Kingfisher PlcJohnson Matthey Plc

Itv PlcIntu Properties Plc

Intl Consolidated Airline-DiIntertek Group Plc

Intercontinental Hotels GrouInmarsat Plc

Informa PlcImperial Brands Plc

Hsbc Holdings PlcHargreaves Lansdown Plc

Hammerson PlcGlencore Plc

Glaxosmithkline PlcGkn Plc

Fresnillo PlcExperian Plc

Easyjet PlcDixons Carphone Plc

Direct Line Insurance GroupDiageo Plc

Dcc PlcCrh Plc

Compass Group PlcCoca-Cola Hbc Ag-Di

Centrica PlcCarnival Plc

Capita PlcBurberry Group Plc

Bunzl PlcBt Group Plc

British Land Co PlcBritish American Tobacco Plc

Bp PlcBhp Billiton Plc

Berkeley Group Holdings/TheBarratt Developments Plc

Barclays PlcBae Systems Plc

Babcock Intl Group PlcAviva Plc

Astrazeneca PlcAssociated British Foods Plc

Ashtead Group PlcArm Holdings Plc

Antofagasta PlcAnglo American Plc

Admiral Group Plc3I Group Plc

1,680.00

303.70

4,927.00

234.40

4,050.00

202.15

984.00

3,968.50

1,131.00

1,615.00

182.50

201.60

361.60

741.30

1,139.00

1,394.00

1,273.00

989.00

4,602.50

2,320.00

3,205.00

273.90

670.00

0.00

592.50

418.90

2,059.50

2,010.50

253.40

809.00

3,030.00

0.00

1,576.00

7,194.00

6,700.00

1,738.00

3,245.00

2,340.00

638.50

8,615.00

195.50

4,303.00

1,007.00

2,014.00

505.50

859.00

366.30

3,391.00

68.97

246.90

1,118.00

335.80

3,000.00

210.50

278.30

548.50

4,086.00

4,077.00

823.00

642.00

3,820.00

640.70

1,406.00

596.00

299.65

1,558.50

353.90

1,436.00

1,668.00

1,155.00

333.30

346.00

2,255.50

7,245.00

2,826.00

1,550.00

2,163.00

198.80

4,688.00

565.50

1,610.00

2,409.00

308.10

662.00

5,236.00

442.65

1,153.50

3,298.00

588.00

223.95

631.00

910.50

528.00

4,698.00

2,832.00

1,627.00

0.00

818.50

1,088.00

2,026.00

805.00

-2.44

0.86

-0.50

-0.17

1.43

-0.47

0.72

-0.97

-0.53

0.37

1.11

1.56

-1.18

-2.11

0.71

-0.07

0.00

0.25

0.03

0.65

0.22

0.11

0.83

0.00

0.85

-0.10

-2.02

-1.69

0.28

-2.06

-2.63

0.00

-1.25

-1.28

-0.74

0.87

1.00

2.36

-0.39

-1.77

-1.61

1.41

0.15

-0.20

1.16

17.51

0.08

1.28

2.31

-5.44

-0.62

2.75

1.69

-4.06

0.51

-2.58

-0.17

0.39

-0.30

-1.83

-0.73

-0.22

1.52

-0.08

-3.15

-0.48

-1.59

-3.82

0.97

-0.77

1.99

-0.77

-0.24

-1.02

-0.81

0.71

0.00

-0.60

0.69

-0.18

0.69

-0.08

-0.63

0.53

-1.34

-2.42

-4.75

1.63

1.12

-0.31

-1.02

-1.03

-0.56

0.25

0.25

-2.34

0.00

-2.79

-2.42

0.05

0.69

9,758,043

3,155,574

507,042

7,870,395

968,470

47,438,462

1,376,778

1,799,848

1,033,786

1,526,690

33,866,798

27,569,360

4,717,331

13,080,824

1,327,583

2,181,373

6,617,301

4,072,816

1,734,969

802,952

306,359

4,976,983

2,487,407

-

1,977,586

2,109,571

4,698,764

5,236,733

15,392,414

5,061,447

4,322,710

-

3,608,015

1,402,763

495,871

8,369,083

245,979

1,773,089

2,524,742

176,780

5,670,405

784,337

4,086,784

1,431,099

3,527,250

4,920,973

4,853,532

566,282

469,576,207

28,297,432

2,506,038

12,565,572

695,936

13,573,958

2,379,860

11,982,619

226,785

525,023

2,051,356

2,319,781

1,421,910

20,130,214

938,386

2,729,282

48,099,263

10,000,701

7,645,257

1,126,682

1,951,480

3,574,304

4,378,860

8,077,863

3,550,158

215,723

1,346,049

3,140,500

423,566

15,668,555

607,273

1,250,222

1,905,648

618,017

15,580,138

3,515,897

1,866,859

27,832,126

9,214,749

633,065

4,168,656

56,353,190

7,090,925

830,415

7,464,601

2,086,117

572,505

1,757,254

-

3,084,534

6,549,723

311,566

1,797,299

FTSE 100

Company Name Lt Price % Chg Volume

East Japan Railway CoItochu Corp

Fujifilm Holdings CorpYamato Holdings Co Ltd

Chubu Electric Power Co IncMitsubishi Estate Co Ltd

Mitsubishi Heavy IndustriesToshiba Corp

Shiseido Co LtdShionogi & Co Ltd

Tokyo Gas Co LtdTokyo Electron Ltd

Panasonic CorpFujitsu Ltd

Central Japan Railway CoT&D Holdings Inc

Toyota Motor CorpKddi Corp

Nitto Denko Corp

9,992.00

1,569.00

4,151.00

2,409.00

1,478.00

2,157.50

442.20

221.50

3,008.00

5,686.00

520.70

13,015.00

1,351.00

694.80

19,050.00

1,675.50

6,117.00

2,878.00

8,397.00

-0.08

0.22

0.90

-0.45

-1.14

0.19

-2.88

0.27

-0.33

-0.73

-2.44

-0.04

-0.66

1.37

-0.24

0.39

-0.60

-0.33

-0.08

803,800

2,960,700

1,649,600

1,171,300

1,434,300

3,846,500

37,261,000

128,660,000

1,339,600

930,900

7,738,000

870,500

10,932,500

11,722,000

372,700

3,248,500

6,931,300

4,778,000

1,132,700

TOKYO

Company Name Lt Price % Chg Volume

Rakuten IncKyocera Corp

Nissan Motor Co LtdHitachi Ltd

Takeda Pharmaceutical Co LtdJfe Holdings Inc

Ana Holdings IncMitsubishi Electric Corp

Sumitomo Mitsui Financial GrHonda Motor Co Ltd

Fast Retailing Co LtdMs&Ad Insurance Group Holdin

Kubota CorpSeven & I Holdings Co Ltd

Inpex CorpResona Holdings Inc

Asahi Kasei CorpKirin Holdings Co Ltd

Marubeni CorpMitsubishi Ufj Financial Gro

Mitsubishi Chemical HoldingsFanuc Corp

Daito Trust Construct Co LtdOtsuka Holdings Co Ltd

Oriental Land Co LtdSekisui House Ltd

Secom Co LtdTokio Marine Holdings Inc

Aeon Co LtdMitsui & Co Ltd

Kao CorpDai-Ichi Life Holdings Inc

Mazda Motor CorpKomatsu Ltd

West Japan Railway CoMurata Manufacturing Co Ltd

Kansai Electric Power Co IncDenso Corp

Sompo Holdings IncDaiwa House Industry Co Ltd

Jxtg Holdings IncNippon Steel & Sumitomo Meta

Suzuki Motor CorpNippon Telegraph & Telephone

Ajinomoto Co IncMitsui Fudosan Co Ltd

Ono Pharmaceutical Co LtdDaikin Industries Ltd

Bank Of Yokohama Ltd/TheToray Industries IncAstellas Pharma Inc

Bridgestone CorpSony CorpHoya Corp

Sumitomo Mitsui Trust HoldinJapan Tobacco Inc

Osaka Gas Co LtdSumitomo Electric Industries

Daiwa Securities Group IncSoftbank Group Corp

Mizuho Financial Group IncNomura Holdings Inc

Daiichi Sankyo Co LtdSubaru Corp

Ntt Docomo IncSumitomo Realty & Developmen

Sumitomo Metal Mining Co LtdOrix Corp

Asahi Group Holdings LtdKeyence Corp

Nidec CorpIsuzu Motors Ltd

Unicharm CorpShin-Etsu Chemical Co Ltd

Smc CorpMitsubishi CorpNintendo Co Ltd

Eisai Co LtdSumitomo Corp

Canon IncJapan Airlines Co Ltd

1,139.00

6,342.00

1,059.50

615.40

5,327.00

1,882.50

334.50

1,538.50

4,199.00

3,245.00

36,250.00

3,643.00

1,769.00

4,692.00

1,071.00

632.30

1,079.00

2,167.50

663.00

721.70

886.10

22,780.00

16,370.00

5,152.00

6,450.00

1,839.50

8,044.00

4,728.00

1,654.00

1,570.00

6,169.00

1,925.00

1,646.50

2,947.00

7,450.00

15,005.00

1,466.50

4,968.00

4,230.00

3,320.00

499.90

2,539.00

4,638.00

4,687.00

2,188.00

2,470.00

2,258.50

10,900.00

0.00

989.20

1,516.00

4,655.00

3,762.00

5,358.00

3,895.00

3,758.00

416.00

1,813.00

692.30

8,393.00

206.80

690.30

2,454.00

4,279.00

2,587.50

3,038.00

1,504.00

1,722.00

4,286.00

44,460.00

10,205.00

1,495.00

2,717.00

9,807.00

31,260.00

2,396.50

27,465.00

5,847.00

1,478.50

3,731.00

3,487.00

-4.41

0.38

-1.44

-0.50

0.08

-1.00

-1.04

0.00

-0.02

-0.34

-1.49

0.22

1.14

0.97

-0.05

0.29

0.47

0.79

-1.49

0.24

0.56

-2.08

0.21

-0.54

-0.91

-1.50

0.00

0.00

-0.48

-0.03

0.47

-0.62

0.64

0.07

-0.63

-0.50

0.76

-1.25

0.57

0.42

-0.04

-0.98

0.19

-0.51

-0.52

-0.44

0.09

0.93

0.00

1.07

-3.13

-0.43

0.53

0.28

-0.18

-0.97

-4.13

-0.38

-1.24

0.32

0.29

-1.00

0.10

0.35

0.25

-0.16

0.13

-0.89

1.35

0.47

-0.63

0.20

0.13

0.53

-0.06

-0.35

-0.56

-0.05

0.17

3.07

0.17

14,831,700

1,229,000

13,977,800

16,923,000

1,641,200

3,484,700

13,952,000

5,718,300

7,075,100

4,425,600

496,500

1,855,000

5,071,400

2,989,000

4,468,000

13,703,800

2,606,000

3,677,100

5,064,500

63,596,400

5,476,700

1,223,100

578,700

858,400

853,000

4,447,700

619,400

3,422,500

1,838,100

4,043,900

3,760,200

5,790,000

8,647,600

4,191,500

635,300

765,700

5,774,600

1,267,600

1,358,400

2,282,000

16,292,600

2,326,000

1,476,600

4,714,500

1,397,000

2,561,100

1,570,700

987,200

-

7,046,200

8,685,100

2,101,300

7,040,700

1,467,700

1,364,300

3,139,200

12,572,000

2,264,800

11,750,000

5,529,500

98,207,800

18,586,500

1,607,600

4,078,700

5,699,600

1,306,000

2,774,000

4,295,800

2,070,700

297,900

1,260,800

3,615,900

1,181,200

1,240,700

267,200

2,928,100

1,927,200

648,900

3,141,100

16,383,200

2,405,700

TOKYO

Company Name Lt Price % Chg Volume

Aluminum Corp Of China Ltd-HBank Of East Asia Ltd

Bank Of China Ltd-HBank Of Communications Co-H

Belle International HoldingsBoc Hong Kong Holdings Ltd

Cathay Pacific AirwaysCk Hutchison Holdings Ltd

China Coal Energy Co-HChina Construction Bank-H

China Life Insurance Co-HChina Merchants Port Holding

China Mobile LtdChina Overseas Land & Invest

China Petroleum & Chemical-HChina Resources Beer Holdin

China Resources Land LtdChina Resources Power Holdin

China Shenhua Energy Co-HChina Unicom Hong Kong Ltd

Citic LtdClp Holdings Ltd

Cnooc LtdCosco Shipping Ports Ltd

Esprit Holdings LtdFih Mobile Ltd

Hang Lung Properties LtdHang Seng Bank Ltd

Henderson Land Development

3.89

32.35

3.78

6.04

5.27

31.75

11.38

97.00

3.78

6.34

23.75

22.45

83.60

22.80

6.34

18.56

22.10

14.06

18.14

10.16

11.20

82.10

9.04

8.49

6.01

2.68

20.35

157.10

49.20

-1.77

0.00

-0.26

-1.15

0.00

0.32

1.25

0.10

-2.07

-0.47

-0.21

0.00

-0.06

-0.87

-1.40

-2.21

-0.67

-0.28

0.33

0.40

-0.71

0.67

-0.33

-0.35

0.00

-0.37

-0.25

-0.88

-0.61

13,052,414

1,263,054

328,680,625

25,520,315

-

5,975,040

4,724,675

3,795,750

10,657,730

190,440,499

33,088,101

5,290,055

17,346,677

16,080,232

67,826,257

7,529,464

14,545,776

3,923,032

28,573,190

37,179,291

6,257,671

3,730,273

62,449,124

3,488,000

665,132

4,012,348

2,276,348

872,550

1,685,557

HONG KONG

Company Name Lt Price % Chg Volume

Hong Kong & China GasHong Kong Exchanges & Clear

Hsbc Holdings PlcHutchison Whampoa Ltd

Ind & Comm Bk Of China-HLi & Fung Ltd

Mtr CorpNew World Development

Petrochina Co Ltd-HPing An Insurance Group Co-H

Power Assets Holdings LtdSino Land Co

Sun Hung Kai PropertiesSwire Pacific Ltd - Cl ATencent Holdings Ltd

Wharf Holdings Ltd

15.46

194.10

64.40

0.00

5.11

3.29

44.90

9.76

5.49

44.00

69.60

13.12

117.20

75.35

244.60

66.85

0.00

0.21

0.47

0.00

-0.58

1.23

0.00

0.31

-0.54

1.03

0.22

-0.46

0.34

-0.53

1.24

0.00

4,381,330

2,600,186

23,929,132

-

238,179,270

209,627,178

2,145,594

6,083,701

91,019,782

37,744,281

3,652,854

4,007,892

2,739,064

718,151

17,296,815

1,440,622

HONG KONG

Company Name Lt Price % Chg Volume

Zee Entertainment EnterpriseYes Bank Ltd

Wipro LtdVedanta Ltd

Ultratech Cement LtdTech Mahindra Ltd

Tata Steel LtdTata Power Co Ltd

Tata Motors LtdTata Consultancy Svcs Ltd

Sun Pharmaceutical IndusState Bank Of India

Reliance Industries LtdPunjab National Bank

Power Grid Corp Of India LtdOil & Natural Gas Corp Ltd

Ntpc LtdMaruti Suzuki India Ltd

Mahindra & Mahindra LtdLupin Ltd

Larsen & Toubro LtdKotak Mahindra Bank Ltd

Itc LtdInfosys Ltd

Indusind Bank LtdIdea Cellular Ltd

Icici Bank LtdHousing Development Finance

Hindustan Unilever LtdHindalco Industries Ltd

Hero Motocorp LtdHdfc Bank Limited

Hcl Technologies LtdGrasim Industries Ltd

Gail India LtdDr. Reddy’s Laboratories

Coal India LtdCipla Ltd

Cairn India LtdBosch Ltd

Bharti Airtel LtdBharat Petroleum Corp Ltd

Bharat Heavy ElectricalsBank Of Baroda

Bajaj Auto LtdAxis Bank Ltd

Asian Paints LtdAmbuja Cements Ltd

Adani Ports And Special EconAcc Ltd

530.75

1,642.40

496.05

233.85

4,237.10

424.95

445.85

84.65

455.35

2,302.65

637.00

282.05

1,409.50

164.70

207.75

179.10

164.10

6,374.05

1,337.20

1,336.20

1,766.75

916.65

285.80

925.25

1,470.65

85.15

274.15

1,566.50

947.30

194.85

3,300.80

1,568.60

809.70

1,152.20

418.40

2,596.55

274.15

561.70

285.35

22,523.60

357.90

736.00

176.20

181.40

2,866.05

506.60

1,105.35

249.50

322.50

1,636.00

0.57

3.81

1.06

-0.28

0.15

-0.49

-1.75

-0.41

1.01

-0.33

-0.90

-1.54

-0.49

-1.47

1.00

-0.56

-0.91

-0.50

-1.15

-2.54

0.88

1.81

-1.75

1.20

0.41

-0.64

-0.99

-1.23

0.63

-1.09

-0.37

1.16

1.18

-1.15

1.25

-0.54

-0.90

0.89

0.00

-0.46

0.10

0.58

0.09

-0.14

-0.67

-2.04

0.06

1.42

-0.31

2.15

1,418,923

4,518,628

3,892,240

10,485,891

297,346

1,521,163

6,719,479

4,733,479

11,111,712

3,045,398

2,640,073

23,572,347

3,143,172

12,918,190

7,898,628

7,817,348

4,165,980

1,172,178

1,198,312

1,963,083

1,567,156

7,381,549

16,558,619

4,025,220

1,195,707

10,669,731

14,068,623

4,605,001

1,160,331

9,843,196

837,870

4,242,083

2,907,706

1,568,006

3,437,363

436,633

2,907,813

2,419,099

26,579,537

19,155

4,633,511

1,170,107

5,236,795

6,859,964

345,753

24,243,937

708,164

4,427,585

3,147,243

506,963

SENSEX

Company Name Lt Price % Chg Volume

WORLD INDICESIndices Lt Price Change

GCC INDICESIndices Lt Price Change

Dow Jones Indus. AvgS&P 500 Index

Nasdaq Composite IndexS&P/Tsx Composite Index

Mexico Bolsa IndexBrazil Bovespa Stock Idx

Ftse 100 IndexCac 40 Index

Dax IndexIbex 35 Tr

Nikkei 225Japan Topix

Hang Seng IndexAll Ordinaries Indx

Nzx All IndexBse Sensex 30 Index

Nse S&P Cnx Nifty IndexStraits Times Index

Karachi All Share IndexJakarta Composite Index

20,958.03

2,384.79

6,039.16

15,451.77

49,465.92

64,353.15

7,237.17

5,271.70

12,443.79

10,683.90

19,251.87

1,536.67

24,698.48

5,944.43

1,348.67

30,029.74

9,342.15

3,171.36

34,094.97

5,707.03

-17.06

-2.66

+13.93

-197.77

-99.24

-508.77

-51.55

-16.18

-29.01

-79.50

-37.56

-0.74

+120.05

+7.65

+3.39

-103.61

-9.70

-2.40

-137.17

-19.50

Doha Securities MarketSaudi Tadawul

Kuwait Stocks ExchangeBahrain Stock Exchage

Oman Stock MarketAbudhabi Stock MarketDubai Financial Market

10,089.86

6,945.74

6,854.27

1,332.16

5,525.43

4,512.91

3,416.71

-115.75

+28.71

+23.42

-1.87

+15.25

-28.13

-22.12

“Information contained herein is believed to be reliable and had been obtained from sources believed to be reliable. The accuracy and completeness cannot be guaranteed. This publication is for providing information only and is not intended as an off er or solicitation for a purchase or sale of any of the financial instruments mentioned. Gulf Times and Doha Bank or any of their employees shall not be held accountable and will not accept any losses or liabilities for actions based on this data.”

CURRENCIESDOLLAR QATAR RIYAL SAUDI RIYAL UAE DIRHAMS BAHRAINI

DINARKUWAITI

DINAR

European stocks weaker as Wall Street gives up gainsAFPLondon

European markets ended the ses-sion in the red yesterday, weighed down by a weaker showing on

Wall Street, traders said.After already starting the session in

negative territory, the main European stock markets ended in the day deeper in negative territory, as Wall Street gave up its initial gains while investors awaited a volley of corporate earnings reports and economic indicators.

London’s FTSE 100 was 0.7% down at 7,237.17 points, Frankfurt’s DAX 30 was 0.2% down at 12,443.79 points, Paris’ CAC 40 slipped 0.3% at 5,271.70, while the EURO STOXX 50 shed 0.4% at 3,563.29 points at close yesterday.

In Frankfurt, the European Central Bank held its key interest rates un-changed at historic lows and its mas-sive bond-buying programme intact, as

expected, at its regular policy meeting.After notching up gains earlier in the

week, investors were currently taking profi t, traders said.

“The euro and equity markets have had a strong week so far, thanks mainly to a market-friendly outcome of the French fi rst round presidential election at the weekend,” said Forex.com analyst Fawad Razaqzada.

“The stock markets in Europe also sighed relief as fears about the future of the European Union receded.”

Financial markets also appeared to take in their stride the outlines of Pres-ident Donald Trump’s tax cut propos-als and plans to renegotiate the North American Free Trade Agreement, said Briefi ng.com analyst Patrick O’Hare.

On Wednesday, the White House had unveiled plans to slash corporate and individual rates, but there were few de-tails and several questions over how the measures will be paid for.

The proposals are part of a wide-ranging plan to fi re the world’s top

economy, which also includes ramping up infrastructure spending and wiping away business regulations.

London Capital Group analyst Jasper Lawler said that while Trump was set to mark his 100th day in offi ce on Satur-day, the fact that the president “hasn’t checked off every box on his 100-day to-do list is not a reason to panic.

“From a markets standpoint, very few of Trump’s pledges for the fi rst 100 days really matter.

Markets specifi cally want Trump to get the job done on tax cuts, infrastruc-ture spending and deregulation.

Signifi cant policy overhauls can’t happen in 100 days,” Lawler said.

Earlier in Asia, Tokyo stocks fell 0.2% after a four-day rally, with dealers un-moved by the Bank of Japan’s decision to lower its infl ation target and stand pat on its monetary easing programme.

But Hong Kong climbed 0.5% for a sixth-straight gain, while Sydney added 0.2% and Shanghai ended 0.4% higher.

BUSINESS

Gulf Times Friday, April 28, 20178

Pedestrians pass the London Stock Exchange Group off ices in Paternoster Square. The FTSE 100 was 0.7% down at 7,237.17 points at close yesterday.

BUSINESS

Gulf Times Friday, April 28, 201710

Fannie and Freddie are back in black and many want their moneyBloombergWashington

Fannie Mae and Freddie Mac were among the biggest disasters of the fi nancial crisis. In September

2008, nine days before Lehman Broth-ers failed, the federal government took over the mortgage companies; it even-tually spent more than $187bn bailing them out. For decades, the companies had provided an implicit government backstop to the US mortgage market, buying loans from private lenders and guaranteeing payments to investors. That helped spur a steady rise in home-ownership — until the subprime crisis hit and Fannie and Freddie were on the hook for billions in losses.

Lawmakers vowed to overhaul the companies and some planned to wind them down completely. But more than eight years later, Fannie and Freddie still operate under government control — and they’re now a bigger part of the system, guaranteeing payment on just under half of all US mortgages, up from 38% before the crisis.

There is one key diff erence: Any

profi ts the companies generate go to the government instead of inves-tors. The latest payment, a combined $9.9bn to the US Treasury at the end of March, pushed the total amount of cash Fannie and Freddie have paid to taxpayers to $266bn, making their bailout one of the most profi table in history.

There’s now a pitched battle over who should get those profi ts. The companies’ pre-crisis common and preferred stocks still trade over-the-counter, and investors who snapped up the shares, such as hedge fund manag-ers Bill Ackman and John Paulson, say Treasury is breaking the law by taking the money. The fi ght goes back to a change the Barack Obama administra-tion made to the bailout terms in 2012.

When the government took them over, Fannie and Freddie issued Treas-ury a new class of preferred stock that paid a 10% dividend, along with war-rants to acquire almost 80% of the companies’ common stock. In 2012 the government changed the terms to say that every quarter Fannie and Freddie would send Treasury all their profi ts except for a certain amount of money

kept in reserve. That reserve started at $3bn in 2013 and was scheduled to fall by $600mn every subsequent year, un-til hitting zero in 2018.

The department said this would hasten the wind down of the compa-nies. In 2013, Fannie and Freddie be-came profi table again. All those earn-ings went to taxpayers, infuriating investors who hoped to share in the rebound. Ackman, along with mutual fund manager Bruce Berkowitz, and Richard Perry, a prominent hedge fund manager, said the changes were illegal and sued.

In more than 20 lawsuits, investors have made claims including that the dividend payment is an illegal confi s-cation of private property, that the gov-ernment lied about its reasoning, and that the structure of the regulator in charge of Fannie and Freddie, the Fed-eral Housing Finance Agency (FHFA), is unconstitutional.

Judges who’ve ruled so far have come down on the government’s side. Mat-thew McGill, an attorney with Gibson, Dunn & Crutcher who represents Perry in one of the cases, says Perry plans to keep pressing his case. “This is a

case where the government’s conduct and the damage it’s done to investors is simply immense,” McGill says. An FHFA spokeswoman declined to com-ment. Treasury didn’t respond to a re-quest for comment.

Investors want the government to begin the process of selling its stake in Fannie and Freddie by stopping the div-idend, but they don’t want the compa-nies to go away. Ackman favours a plan that would strengthen the companies and keep their activities largely intact. “There is simply no credible alterna-tive to Fannie and Freddie,” he wrote in a letter to investors in March.

The Obama administration left it to Congress to pass legislation deal-ing with the problem, but nothing has emerged. Texas Republican Jeb Hen-sarling, chairman of the House Finan-cial Services Committee, wants to wind down Fannie and Freddie completely, while some Democrats think they should be strengthened rather than killed.

Some small lenders and advocates for aff ordable housing would also like to see the dividend suspended to let the mortgage companies build their

reserves. They’re nervous that any al-ternative Congress might put in place would make it harder for lower-income borrowers to get mortgages. Investors had hoped Donald Trump’s adminis-tration would move to sell the govern-ment’s stake, but so far the view from the White House is unclear. Treasury Secretary Steven Mnuchin has said that ending government control is a prior-ity, but that he’s focused on regulatory relief and tax reform.

In the middle of the debate is Mel Watt, the Obama appointee who heads the FHFA and essentially controls Fan-nie and Freddie. Watt has the author-ity to order the companies’ boards of directors to suspend the dividend pay-ments. He came close to doing so at the end of March, just before Fannie and Freddie’s last payment was due, according to people familiar with the matter. A group of senators wrote Watt a letter that week, warning him against stopping payment, and Watt decided to make it.

Stopping the payment would have let Fannie and Freddie build their re-serves, making it less likely they would need more money from taxpayers in

the event of a loss. Under terms of the bailout, the companies could still bor-row up to $259bn in an emergency, so insolvency is a long way off . Watt, a former North Carolina congressman, has told people around him that he’d consider it a dereliction of duty if the companies needed more money on his watch.

Investors would’ve been thrilled if Watt had withheld the dividend in March. Building capital is a necessary precursor to selling Fannie and Freddie back to the private market, where their shares could be worth billions. Mnuch-in put one of his counsellors, Craig Phillips, in charge of the situation. In meetings, Phillips has fl oated ideas as wide-ranging as putting the companies into receivership, which could wipe out investors, as well as legislation to re-place or supplement them with a new system, according to people familiar with the matter. Clarity on what the administration wants to do could be a long way off .

The bottom line: Fannie Mae and Freddie Mac have paid $266bn to the US Treasury. Investors say it’s time for them to get paid.

Talks to avert shutdown near end as Trump bows on ObamacareBloombergWashington

US lawmakers are putting the final touch-

es on a $1.1tn spending bill needed to avert

a government shutdown, after the White

House appeared to satisfy Democrats’

demands that President Donald Trump

and Republicans protect a key piece of

Obamacare.

House Republicans introduced a

seven-day stopgap measure late on

Wednesday aimed at giving both cham-

bers enough time to finish negotiating

and pass a broader spending bill that

would fund the government through

September 30.

The move should remove the threat of

a shutdown, even as lawmakers continue

to haggle over several outstanding issues.

The White House on Wednesday

afternoon assured lawmakers that the

administration would continue to make

the Obamacare payments at issue, which

are used to subsidise coverage of lower-

income Americans, according to a person

familiar with the negotiations.

“This decision brings us closer to a

bipartisan agreement to fund the govern-

ment and is good news for the American

people,” Senate Minority Leader Chuck

Schumer said on Wednesday afternoon

in a statement. “There are outstanding

issues to be resolved, particularly with

riders, but this is a positive development

for the negotiations.”

With government funding set to run

out Friday, Republicans and Democrats

in Congress have reached agreement on

most elements of the sweeping spending

bill, which remains under wraps.

But Trump criticised Democrats for

their stances in the negotiations.

“The Democrats want to shut govern-

ment if we don’t bail out Puerto Rico and

give billions to their insurance companies

for OCare failure,” Trump wrote on Twitter

yesterday morning, using an abbrevia-

tion for Obamacare. Democrats had also

pushed for funds to help Puerto Rico

cover a shortfall in Medicaid payments.

The omnibus is being delayed by

fights over other policy areas, including

Republican demands for changes to the

Dodd-Frank financial law in the bill, a

“conscience clause” provision to allow

insurers to refuse certain procedures, and

language to restrict abortion coverage

on Obamacare exchanges, a Democratic

aide said.

The biggest issue was the billions in

cost-sharing payments used to off -

set health premiums for low-income

people. Insurers are threatening to raise

premiums if they don’t get the subsidies

and could further drop coverage in

Obamacare markets.

House Democratic leader Nancy Pelosi

said in a statement that negotiators had

made progress on the health-care issue,

though other disputes remained. She

spoke twice on Wednesday with White

House chief of staff Reince Priebus, ac-

cording to a Democratic aide.

A White House decision to continue

the payments may be enough to clear the

current deadlock and allow the spending

bill to move forward, although it’s unclear

how quickly Congress would act.

On Thursday, Trump’s budget director,

Mick Mulvaney, told CNBC that he’s hope-

ful there will be no shutdown but is unsure

of where Democrats stand.

“We thought we had a deal Monday”

when they took funding the border wall

off the table, but since then, Democrats

have gone silent, he said. He believes

Senate Democrats now are “looking

for something they can ask for” but he

doesn’t think there is such a sticking point,

he said.

“This administration has made CSR

payments in the past, and the only reason

some are raising this now is to hold the

government hostage and find an excuse

to oppose a bipartisan agreement,” he

said, referring to the cost-sharing funds.

Democrats have expressed concern

that the cost-sharing payments could

be used as leverage against them in the

future or get nixed in the courts and blow

up the insurance market. The payments

are currently being challenged by House

Republicans in a lawsuit questioning their

legality.

Anthem threatened to raise rates for

its Obamacare plans next year if the US

government stops funding subsidies for

lower-income customers, raising the ante

on the outcome of this debate.

Chief executive off icer Joseph Swedish

said on a conference call Wednesday that

the insurer could raise its rates by 20% if

the subsidies aren’t paid to insurers.

Pelosi clashed with Mulvaney on

Tuesday night over the issue during a

telephone call.

She reiterated to Mulvaney what has

been the House Democratic negotiating

position in the talks that CSR payments

must be included in the omnibus, said a

Democratic aide familiar with the conver-

sation.

The aide said Mulvaney indicated

that, while the Trump administration had

continued the payments, off icials hadn’t

yet decided whether they would make the

May payment.

The Democratic aide said Mulvaney

made clear that, absent congressional ac-

tion, the judge’s order ruling the payments

illegal would stand and the administration

would cease making payments.

But a White House off icial said that

Mulvaney didn’t say the administration

would end payments.

“Instead of working with Democrats to

avert another disastrous Republican gov-

ernment shutdown, the Trump admin-

istration is cruelly threatening to raise

health premiums on millions of families,”

Pelosi said in a statement Wednesday,

noting that Mulvaney helped push the

GOP towards a government shutdown

in 2013.

The outlines of the broader spending

package have been largely to Democrats’

liking, including the GOP decision to

omit $18bn in domestic spending cuts

proposed by Trump and Mulvaney.

Democrats had off ered to increase

defence spending if the deal included the

CSR funding along with money for Puerto

Rico’s Medicaid program and coal miners’

health benefits.

United to pay oversold fl iers up to $10,000 after dragging furoreBloombergAtlanta

United Continental Hold-ings will off er as much as $10,000 to passengers

who voluntarily give up their seats on oversold fl ights, one of 10 changes the airline is adopt-ing after a customer was dragged off a plane by security offi cers.

The carrier will also reduce the overbooking of fl ights and refrain from calling in law en-forcement offi cials unless safety and security are at risk, accord-ing to a company statement yes-terday. United issued the chang-es more than two weeks after the forcible removal of David Dao, a 69-year-old passenger who re-fused to surrender his seat, by Chicago Department of Aviation offi cials.

Rigid policies for handling cases where passengers must be denied boarding “got in the way of our values,” United chief ex-ecutive offi cer Oscar Munoz said in the statement. The airline is still dealing with brand damage and other fallout from the April 9 incident, and faced another round of negative headlines on Wednesday when a giant rabbit died as it awaited a connecting fl ight after arriving in Chicago from London on United.

The company said it’s striv-ing to become a “better, more customer-focused airline” to win back the public’s trust after a worldwide furore over Dao’s treatment and calls from some politicians to crack down on the industry with tougher rules and legislation.

“Every customer deserves to be treated with the highest levels of service and the deepest sense of dignity and respect,” Munoz said. “Two weeks ago, we failed to meet that standard and we profoundly apologize.”

The United board cancelled Munoz’s expected 2018 eleva-tion to chairman and tied com-pensation more closely to cus-tomer service last week.

Along with the statement on

policy changes after Dao’s mis-treatment, the Chicago-based airline also released a timeline of what happened before and during the dragging — thereby meeting a deadline for providing an account of its actions to a US Senate committee probing the matter. Dao suff ered a concus-sion, broken nose and two lost teeth in the incident, according to his attorney.

The airline said it needed to

remove four seated passengers from the fl ight to make room for crew members fl ying to Louis-ville, Kentucky. Dao and his wife were among those randomly se-lected.

After Dao refused to surren-der his seat, another passenger came forward and off ered to leave the plane in exchange for $1,000, United said. The airline turned down the off er because it needed two volunteers to avoid

removing the Daos. No one else was willing to leave the plane without a guaranteed arrival in Louisville that same night — something United couldn’t promise because of maintenance problems on another Louisville-bound fl ight.

The company’s 10 policy changes are being rolled out this year, with some already in place. The $10,000 maximum payout went into eff ect yesterday. Un-til now, gate agents were only allowed to off er passengers as much as $500, while managers could go as high as $1,350.

In raising potential payouts, United followed the lead of Del-ta Air Lines, which earlier this month said it pay as much as $9,950 compared with a previ-ous cap of $1,350.

Additionally, United will re-frain from demanding that seat-ed customers surrender their spots involuntarily, unless safety or security is at risk. The com-pany is planning a new automat-ed system to solicit volunteers willing to give up their places on overbooked fl ights. Other meas-ures are designed to give em-ployees more training and power to deal with diffi cult situations.

By June, United expects to have a team in place to help gate agents fi nd ways to use near-by airports, other airlines and ground transportation to get passengers and crews to their destinations.

“The changes we have an-nounced are designed to better serve our customers and em-power our employees,” the air-line said. “This is how we begin to earn back your trust.”

An employee assists a passenger inside the United Continental Holdings terminal at Newark Liberty International Airport (EWR) in Newark, New Jersey. Rigid policies for handling cases where passengers must be denied boarding “got in the way of our values,” United chief executive off icer Oscar Munoz said in the statement.

Trump administration opens investigation into aluminium tradeWill address whether aluminium imports hinder national security; probe parallels investigation on steel begun last week

BloombergNew York

The Trump administra-tion opened an inves-tigation on Wednesday

into whether an infl ux of for-eign aluminium is damaging US manufacturers severely enough to threaten national security, beginning a process that could lead to curbs on imports, Com-merce Secretary Wilbur Ross said.

“Here’s why we did it,” Ross told reporters, “Imports have been fl ooding into the alumin-ium industry and the defence angle is that high-purity alu-minium is used in the F-35” as well as other military aircraft and vehicles. In the event of a war, domestic manufacturers might be unable to meet the Pentagon’s needs, he said.

The investigation mirrors a probe the Commerce Depart-ment launched a week earlier focusing on the steel industry, also invoking a seldom-used legal provision: section 232 of the Trade Expansion Act. A CNBC report on plans for the investigation sent aluminium stocks surging, with Century Aluminum Coclosing up 8.74% and Constellium up 2.46%.

The benchmark global alu-minium price has gained 16% this year after rising by 12% last year, helped by stable demand but also reports that China is stepping up eff orts to curb ex-cess aluminium capacity. China is the world’s biggest producer of the metal and has been a target of criticism for creating a glut of aluminium that pre-viously was depressing global prices.

The probe Ross announced comes as the US has a stand-ing trade complaint with the

World Trade Organisation al-leging Chinese subsidies to its domestic aluminium producers are hurting prices of the metal. The case, fi led by the Obama administration in its fi nal days, also was supported by Canada and Japan, among others.

When asked about the WTO complaint, Ross said that it was still in the “exploration” phase and that it may be “subsumed” by the new investigation.

Last summer, Century Alu-minum chief executive offi cer Mike Bless said China was sub-sidising its smelters to an ex-tent that violates World Trade Organisation rules, and that something had to give or else they may have to shut down a smelter in Hawesville, Ken-tucky, that mass produces high purity aluminium used in US fi ghter jets.

Ross said the US currently only has one company that can mass produce aluminium in that quality, although he didn’t identify the Hawesville smelter.

If the Commerce Department fi nds evidence of a national se-curity threat from aluminium imports, the president is au-thorised to unilaterally “adjust imports.” Only two presidents — Richard Nixon and Gerald Ford — have ever granted relief under Section 232, citing na-tional security concerns stem-ming from the global oil crisis of the 1970s.

Until the Trump adminis-tration opened the steel inves-tigation last week, the US had launched only two such inves-tigations since the 1970s, and in each the Commerce Depart-ment’s Bureau of Industry and Security declined to recom-mend action.

The presidential memoran-dum initiating the steel probe also cited aluminium manufac-turing as a core industry that is critical to the manufacturing and defence base, along with vehicles, aircraft, shipbuilding and semiconductors.

BUSINESS11Gulf Times

Friday, April 28, 2017

Total approves first project since 2014 as profits surgeCORPORATE RESULTS

French energy company Total gave the go-ahead

yesterday to develop its first major project since

2014 after reporting a sharp rise in quarterly profit

that underscored its drive to cut costs throughout

the oil price downturn.

Total, France’s largest company, kickstarted the sec-

tor’s first-quarter earnings reporting with an upbeat

tone, as its adjusted net profit surged 56% to $2.6bn

compared with the same period of 2016.

Analysts had forecast Total’s net adjusted profit at

$2.4bn in the quarter.

Total said it had approved the development of its

Aguada Pichana Este project in the Argentine Vaca

Muerta shale gas site, and had increased its stake

in the license to 41% from 27%. Greater confidence

in an oil price recovery following years of lower

investment and after Opec and other major produc-

ers agreed to cut output is expected to lead to a

cautious revival in project approvals.

Shell in February approved the development of its

Kaikias deepwater field in the Gulf of Mexico, the

first project clearance since 2015.

The first phase of the project will cost around

$500mn, Total chief executive Patrick Pouyanne

told journalists on the sidelines of an oil summit in

Paris.

Total maintained its investment, production and

savings guidance stated in February, when it said it

aimed to make a further $3.5bn of savings in 2017.

It had set its capital expenditure, excluding re-

source acquisition, at $14 billion-$15bn in 2017.

It said its cash flow in the months ahead would

benefit from production growth and cost reduction,

after it generated free cash flow of $1.7bn in the

first quarter, while Total’s oil production rose 4%.

The company said its planned ramp-up of recently

started projects would continue to boost output,

although this would be aff ected by seasonal main-

tenance as well as the full implementation of the

Opec quotas.

Ford Motor

Ford Motor Co reported a lower quarterly net profit

yesterday but beat analyst expectations amid

higher commodity, engineering and recall costs,

and a drop in vehicle sales Ford shares were down

slightly at $11.54 in early trade.

The No 2 US automaker, which reiterated its pretax

profit forecast for 2017, warned investors in late

March that higher costs and lower sales volumes

would hurt quarterly earnings.

Chief financial off icer Bob Shanks told reporters at

the company’s headquarters in Dearborn, Michi-

gan, that additional costs made this the “toughest

quarter” for 2017.

Shanks said Ford’s results for the rest of the year

would be “about flat to a little bit better” compared

with 2016.

Shanks said Ford’s own used-car values at its

finance arm were down 7% compared to the same

quarter in 2016, but said customers’ credit scores

remained high and we “feel really good about

where credit is.”

Ford’s costs during the first quarter were hurt by

two recalls in North America, one to replace po-

tentially faulty side door latches and the other for

under-hood fire risks.

The company said it expects to spend $295mn to

fix those problems.

Ford expects commodity costs to be around $1bn

higher this year.

Shanks said around half of that will be due to higher

steel prices.

Ford maintained its expectation for a full-year 2017

pretax profit of around $9bn, down from a record of

$10.4bn in 2016.

The company reported a first-quarter net profit of

$1.6bn, or 40 cents a share, down 36% from $2.5bn,

or 61 cents per share, a year earlier.

Analysts had, on average, expected earnings per

share for the quarter of 35 cents.

Automotive revenue rose to $36.5bn from $35.3bn

a year earlier.

Analysts had expected $34.7bn.

Volkswagen

German car maker Volkswagen will manufacture its

new e-Crafter electric utility vehicles at a factory in

neighbouring Poland, a spokesman for the group

said yesterday.

“At this stage of the project, the design of the

vehicle will be finalised in Hanover (Germany). In

the next stage, production will be transferred to

a new factory in Wrzesnia,” western Poland, VW

spokeswoman Dagmara Prystacka said, quoted by

the Polish PAP news agency.

She declined to provide further details.

Volkswagen has said it would deliver the first new

electric vehicles to clients later this year.

Like its existing fossil fuel models, VW says its new

electric-powered utility vehicle will be able to travel

more than 200km (124 miles) and can carry a load

of 1.7 tonnes.

Volkswagen began construction on its new plant

in Wrzesnia in 2014, an investment estimated to be

worth around €800mn ($869mn). VW now says it

aims to become the world leader in electric cars

by 2025.

Net profit at VW reached €5.1bn in 2016, as the Ger-

man automaker became the biggest brand in car

sales in volume terms, overtaking Japan’s Toyota.

The recovery came after a stinging €1.6bn loss in

2015 triggered by the Dieselgate scandal which

forced VW to admit it had installed so-called “cheat”

software in 11mn diesel-engine cars worldwide.

Renault

Renault’s revenue surged by a quarter in the first

three months of 2017, the French car maker said

yesterday, as new models boosted deliveries and

pricing, while production increased for industrial

partners including Nissan.

Quarterly revenue rose to €13.13bn ($14.27bn) from

10.49bn a year earlier, also lifted by the consolida-

tion of Russian Lada sales.

Excluding Lada parent Avtovaz, group sales rose

19.7% to €12.56bn.

Renault’s revenue performance beat the €12.49bn

expected by analysts, based on the median of 10

estimates in an Inquiry Financial survey for Reuters.

A near-16% jump in vehicle deliveries was the big-

gest contributor, boosting revenue by 9.2%, helped

by the renewal of the Megane family of compact

cars in 2016.

Sales to partners — including Micras built in France

for alliance partner Nissan and semi-assembled ve-

hicles for Iran — lifted revenue by 3.5%. Favourable

currency eff ects added 1.3% on a stronger Russian

rouble and Brazilian real.

Renault increased its 2017 global auto-market

growth forecast to 1.5-2.5% from 1.5-2% and reiter-

ated its own full-year goals, including increased

operating profit and revenue at constant exchange

rates.

Vale

Shares in Vale slumped the most in two weeks

yesterday, as executives signalled lacklustre trends

for iron ore prices this year and investors reacted to

a first-quarter profit miss with disappointment.

On a results conference call, company executives

said supply and demand of the main ingredient for

steel look balanced, helping prices stay at $70 reais

per tonne or less.

Net income totalled $2.490bn, well below consen-

sus estimate of $3.325bn, reflecting the impact of

heavy rains that slowed output in some Brazilian

mines and rising financial expenses.

It compared with $525mn in the prior three months

and $1.776bn a year earlier.

Last week, Vale said first-quarter iron ore output fell

6.7% as seasonal rainfalls in the so-called northern

system, which groups the Carajás, Serra Leste and

S11D mines in northern Brazil, hampered extraction.

Revenue slipped on a sequential basis, even as

realised prices rose 9% from the fourth quarter.

Adjusted earnings before interest, taxes, deprecia-

tion and amortisation, or EBITDA, hit $4.308bn,

below a consensus estimate of $4.996bn compiled

by Thomson Reuters.

Despite the profit miss, Vale is taking advantage of

higher realised prices on an annual basis to slow

the pace of asset sales to cut debt.

Higher ore recovery last quarter also helped Vale

generate $2.454bn in free cash flow — the money

left for bond and shareholders after all expenses

are paid.

Net debt fell to $22.777bn in March, from $25.042bn

in December.

Vale wants the indicator between $15bn and $17bn

this year.

Air China

Air China’s net profit fell 40% in the first three

months of 2017, hit by rising oil prices and weak-

ness in the yuan.

China’s flag carrier yesterday posted profit attribut-

able to shareholders of 1.47bn yuan ($213mn) for

January to March, down from 2.4bn yuan during

the same period last year.

Its rival China Eastern Airlines said net profit at-

tributable to shareholders was 2.82bn yuan for the

quarter, up from 2.6bn yuan a year earlier.

Southwest Airlines

Southwest Airlines Co reported a smaller-than-

expected quarterly profit, hit by higher operating

expenses and a decline in average fares.

The airline’s shares fell as much as 4.3% to $54.52 in

morning trading yesterday.

The No 4 US airline by passenger traff ic said its unit

revenue, a key metric that compares ticket sales

with flight capacity, fell 2.8% in the quarter ended

March 31, hurt by competitive fare pricing and a

shift in Easter travel demand to April.

However, the Dallas, Texas-based carrier expects

unit revenue in the current quarter to rise 1-2%. The

metric turned positive in April even after excluding

an about $10mn benefit from the shift in Easter

date, the company said.

Southwest’s unit costs, excluding fuel, oil expense

and some items, increased 6.9% in the quarter and

the company expects the metric to increase by

about six% in the current quarter.

While more people booked travel on Southwest in

the first quarter, fares on average declined 2.6%.

The company said its net income fell to $351mn, or

57 cents per share, in the quarter, from $513mn, or

79 cents per share, a year earlier. Excluding items,

the company earned 61 cents per share, compared

with estimates of 63 cents, according to Thomson

Reuters I/B/E/S.

Operating revenue rose 1.2% to $4.88bn.

Airbus

Core profit at Airbus more than halved in the first

quarter as it cut prices of old models and delays at

an engine maker hampered deliveries of its profit-

able new A320neo jet.

The European firm said it was confident of plans

to increase jet output despite wobbling demand,

but voiced caution about the speed at which it can

lower costs on its new A350 and warned of “signifi-

cant” exposure on its troubled A400M army plane.

Airbus finance director Harald Wilhelm took aim at

US supplier Pratt & Whitney over engine delays that

forced it to deliver fewer A320neos than planned

last quarter, despite fresh assurances from the

engine maker that it will meet targets.

He also said Airbus was trying to secure a return

this year to European government export funding,

which was suspended last year amid a probe into

suspected corruption in jetliner sales.

Wrangling over past business dealings deepened

on Wednesday when Austria disclosed a separate

fraud probe into Airbus chief executive Tom Enders

over a 2003 fighter deal.

Airbus called the accusations “completely unsub-

stantiated”. Airbus quarterly adjusted operating

profit fell 52% to €240mn ($261.7mn) as revenues

rose 7% to 12.988bn.

Analysts were on average expecting core profit of

€344mn, down 31%.

The Airbus plane making business saw 31% lower

profit despite a 13% rise in revenues.

It blamed a less favourable mix of deliveries in the

quarter, which included more of the new but still

sharply discounted A350s and higher production

ramp-up costs.

Kotak Mahindra Bank

India’s Kotak Mahindra Bank forecast a decline in

bad loans and provisioning costs and a pick up in

credit growth this financial year after reporting a

better-than-expected 40% rise in fourth-quarter

profit yesterday.

Kotak Mahindra — the fourth-biggest private sec-

tor lender in the country by assets but the third

most-valuable with a market capitalisation of more

than $25bn — posted net profit of 9.76bn rupees

($152mn) for the three months to March 31, ahead

of analysts’ estimates of 9.38bn rupees.

Its bad loans, however, ticked up to represent 2.59%

of total loans as of the end of March from 2.42%

three months ago.

Billionaire Uday Kotak, the biggest shareholder and

the chief executive of the bank, predicted better

days ahead for the lender which has seen its bad

loans rising since its $2.4bn acquisition of smaller

rival ING Vysya in 2015 in India’s biggest banking

sector takeover.

He said the impact of the deal had been almost fully

absorbed by this point.

For the year to March, the bank’s credit cost fell to

61 basis points from 82 basis points in the previous

year.

The bank’s loans grew at about 20% in the March

quarter, at a faster pace than 15% for the full finan-

cial year.

Kotak said he expected loan growth in the current

financial year to be broadly in line with the pace last

quarter.

Nokia

Finland’s telecoms giant Nokia reported yesterday

that it remained deep in the red at the start of the

year, with sales in its main business, networks, on

the decline.

But the stock market rejoiced as analysts’ fears of a

much worse performance were allayed.

The company posted a loss of €488mn ($532mn) in

the first quarter, an improvement from the €609mn

a year earlier, prompting chief executive Rajeev

Suri to say he believed in an “improving business

momentum, even if some challenges remain”.

Investors agreed with that assessment, sending

Nokia’s share price more than 6% higher on the

Helsinki stock exchange to €5.29 by late morning.

While the company’s overall sales declined by 2% to

€5.38bn, sales in its core networks business fell by

6%, to €4.9bn.

Once the world’s number one handset maker,

Nokia transformed itself into a network equip-

ment company and bought its hugely unprofitable

French-American rival Alcatel-Lucent a year ago,

sending the whole group’s results plunging into the

red in 2016.

The firm recorded a net loss of €766mn last year.

But in fact the company has been going through a

process of radical transformation for several years

now.

In 2013, it bought 50% of its network activities from

Germany’s Siemens, and the following year it pulled

out of mobile phones.

It sold its mapping unit Here in 2015 and completed

the deal late last year to buy Alcatel-Lucent, which

had only recorded one year of annual profit since

its inception in 2006.

Nokia was the world’s top mobile phone maker

between 1998 and 2011 but was overtaken by South

Korean rival Samsung after failing to respond to the

rapid rise of smartphones.

Roche

Swiss drugmaker Roche, encouraged by better

than expected first-quarter sales, said it was con-

fident new drugs will help to deliver revenue and

profit growth even as its older medicines take a hit

from cheaper copies.

Sales rose to 12.94bn Swiss francs ($13.03bn), ahead

of the 12.704bn franc average estimate of analysts

in a Reuters poll.

The company, which confirmed its 2017 full-year

targets, releases earnings details in July.

Drug unit head Dan O’Day said new immunothera-

py Tecentriq, breast cancer drug Perjeta and newly

approved multiple sclerosis drug Ocrevus will

counteract looming patent expirations for cancer

medicines Avastin, Herceptin and Rituxan.

Rituxan faces competition from near-copy biolog-

ics, called biosimilars, this quarter, with Herceptin

exposed in the second half as patents expire.

Roche’s drug division sales rose 4% to 10.2bn

francs, topping the analysts’ average estimate of

9.89bn.

Diagnostic products rose 6% to 2.77bn francs, also

ahead of the poll.

Sales of Tecentriq, approved last year to treat blad-

der and lung cancer, hit 113mn francs, more than

the 103mn estimate in the Reuters poll.

Perjeta sales rose 19% to 524mn francs, with Roche

optimistic that a key trial result announced during

the quarter will expand the medicine’s use in 2018.

While Ocrevus was approved only in late March,

Roche chief executive Severin Schwan said the

launch was going “very well” in the $20bn overall

MS market.

For the first three months of 2017, the three older

drugs that account for more than a third of Roche’s

revenue also beat analyst expectations.

Herceptin sales rose 2% to 1.76bn francs and

Rituxan rose 4% to 1.9bn francs.

While Avastin sales slipped 2% to 1.68bn francs, the

drop was less than expected.

Roche stuck to a 2017 target of a low- to mid-single-

digit sales growth rate, with similar core earnings

per share growth, but some analysts suggested the

company was being tentative.

Deutsche Bank

Deutsche Bank more than doubled its profit in

the first quarter, but its shares fell yesterday after

the German lender’s earnings showed declining

revenues and its securities trading business lagging

US rivals.

Chief executive John Cryan, however, pointed to

the eff ect of the revaluation of Deutsche Bank’s

own debt, which it has to value at market prices.

That has meant the bank was able to book profits

when its own debt value fell during last year’s

turbulence, but now booked losses as investor

confidence returned.

The bank’s first-quarter net profit rose to €575mn

($627mn) compared to 236mn a year ago.

Cryan added that a 5% fall in adjusted costs showed

the progress the bank was making in restructuring,

while it lowered its cost-income ratio to 86%. But

this still lags rival banks, many of whom manage 60

to 70% ratios.

Deutsche’s headcount, which it has unsuccessfully

tried to cut for years, was 3,300 lower at the end

of March despite 370 hires in compliance and anti-

financial crime.

The bank’s core tier 1 equity ratio rose to 14.1% from

11.8% at the end of 2016, if this month’s $8.5bn cash

call is taken into account.

Gazprom

Russian energy giant Gazprom said yesterday net

profit increased 21% last year, with a rise in sales

driven mostly by crude oil and gas condensate.

The company said total sales had increased by

37.7bn roubles ($662mn, 607mn euros), up 1% from

the 2015 figure to 6.1tn roubles.

Net profit came in at 951.6bn roubles.

“The increase in sales was mainly driven by an

increase in sales of crude oil and gas condensate,”

Gazprom said.

Net sales of gas were down 4% on 2015, the com-

pany said, as a weak rouble hit the value of exports

to key markets of Europe and Turkey despite the

overall volume of gas sold to the continent rising

by 24%. Gazprom is the dominant gas supplier in a

number of central and eastern European countries.

Last year it supplied nearly a third of Europe’s gas

needs, a record amount despite tensions with the

European Union and a desire by the bloc to reduce

its dependence on Russian supplies.

PayPal

PayPal Holdings raised its earnings outlook on

Wednesday after reporting higher-than-expected

quarterly profit resulting from an increase in pay-

ment processing volumes and user growth.

The company raised its full-year profit forecast to

$1.28-$1.33 per share from $1.26-$1.31, and said its

board authorised a $5bn share buyback pro-

gramme.

Revenue rose 17% to $2.98bn, beating analysts’

average estimate of $2.94bn.

Chief financial off icer John Rainey said the

company was planning some staff cuts and other

restructuring initiatives which will slash $75mn in

annual costs.

“Less than 3% of our global workforce will be

aff ected and based on current plans, we do not

expect a net decrease in headcount for the year,”

Rainey said.

Chief executive Dan Schulman said the company

had added 6mn new active accounts in the first

quarter, the largest quarterly user increase in the

past 3 years.

Rainey said growth in revenue had been driven by

an increase in payments processing volumes in

both its core business and other services such pay-

ments platform provider BrainTree.

PayPal’s total payments volume jumped 22.5% to

$99.33bn, beating research firm FactSet StreetAc-

count’s estimate of $99.20bn.

Mobile payments volume rose 51% to about $32bn

in the quarter. Payment volumes at Venmo, its mo-

bile peer-to-peer payment platform popular with

younger customers, more than doubled to $6.8bn

in the first quarter.

The company’s net income rose to $384mn, or 32

cents per share, in the first quarter, from $365mn,

or 30 cents per share, a year earlier.

On an adjusted basis, PayPal earned 44 cents per

share, above the average analyst estimate of 41

cents, according to Thomson Reuters I/B/E/S.

Lloyds Banking

Lloyds Banking Group yesterday reported its first

quarter profit remained steady, defying analysts’

expectations of a dip in performance at Britain’s

biggest mortgage lender following the vote last

June to leave the European Union.

Lloyds said underlying profit before tax was a

better-than-expected £2.1bn ($2.70bn), in what will

likely be the lender’s last earnings update before a

return to full private ownership following its state

bailout during the 2008 financial crisis.

Lloyds reported its net interest margin rose to 2.8%

from 2.74% a year ago and said it expected the

measure to hold at the new level this year, again de-

fying expectations the key measure of profitability

would dip on economic uncertainty.

The bank said it had not seen signs of rising

defaults among consumers using credit cards and

other unsecured borrowing methods, an area the

Bank of England said in January it was watching

closely.

The bank’s common equity tier 1 ratio, a closely

watched measure of balance sheet strength, now

stands at 14.3%, making it one of the best capital-

ised lenders among its major European peers.

Taxpayers have recouped all of the £20.3bn ($26bn)

invested in the bailout of Lloyds during the 2008

financial crisis, British finance minister Philip Ham-

mond said last week.

While Lloyds’s booming profits in recent years sig-

nal its diverging fortunes from RBS since the 2008

crisis, it is still plagued by some of the costs from its

behaviour in that era.

Lloyds booked a £100mn charge yesterday to pay

for a compensation scheme for victims of a fraud

by its HBOS unit for which six people were jailed

this year.

Bayer

German chemicals and pharmaceuticals giant

Bayer yesterday upped its forecast for 2017, after

netting a big boost to profits on the back of higher

sales in the first quarter.

Sales at the group grew 11.7% to €13.2bn ($14.4bn),

while profits added 38% to reach almost €2.1bn —

both outstripping analyst forecasts. Operating, or

underlying, profit grew 34.3% to €3.1bn.

The group increased its forecast for the full year,

upping revenue projections to €51bn and predict-

ing growth of around 10% in operating profits

excluding special items.

A strong performance at materials subsidiary

Covestro, majority-owned by Bayer but with a sepa-

rate stock market listing, contributed to the group’s

positive outlook.

Bayer reported healthy growth across its prescrip-

tion drugs, over-the-counter medications, animal

health and agrochemicals divisions.

Swiss National Bank

Switzerland’s central bank posted a profit of 7.9bn

Swiss francs ($7.95bn) in the first quarter, it said

yesterday, boosted by gains from the huge foreign

currency reserves built up during its long campaign

to weaken the Swiss franc.

The Swiss National Bank made a profit of 5.3bn

francs on its foreign currency holdings that rose to

683.18bn francs at the end of March, a figure larger

than Swiss GDP.

The bank also made a profit of 2.2bn francs from

a valuation gain on the gold it holds, and 466.4mn

francs from negative interest rates it has charged

on the sight deposit accounts it holds for commer-

cial banks.

The SNB is not required to make a profit, with its

main mandate to ensure price stability in Switzer-

land defined as annual inflation of under 2%. But

a portion of any profit it does make is distributed

to the Swiss government and the country’s 26

cantons.

Samsung Electronics

Samsung Electronics Co yesterday flagged stronger

earnings and announced a cancellation of treasury

shares after posting a solid first-quarter profit

boosted by the memory chip business, sending its

shares to a new high.

Samsung rejected a call from US activist hedge

fund Elliott to split itself in two but accepted part

of the fund’s proposals yesterday, revealing plans

to cancel its existing treasury shares worth over

$35bn by 2018.

While the first quarter was a torrid time for

Samsung as chief Jay Y Lee was swept up in a

political corruption scandal, the world’s top maker

of memory chips, smartphones and televisions still

managed to book a profit that supports expecta-

tions for record earnings in 2017.

First-quarter operating profit for Asia’s most valu-

able company by market capitalisation was 9.9tn

won ($8.75bn), matching Samsung’s earlier guid-

ance. Revenue rose 2% to 50.5tn won.

Elliott welcomed the share cancellation and said it

saw “room for even more progress”. The fund had

called for Samsung to adopt a holding company

structure by splitting itself in two, and to pay out a

30tn won a special dividend.

BUSINESSFriday, April 28, 2017

GULF TIMES

ECB keeps money taps open; nods to eurozone recoveryDraghi acknowledges eurozone recovery; council tweaks introductory statement after debate; but Draghi insists underlying inflation still subdued

ReutersFrankfurt

The European Central Bank left its ultra-easy policy stance in place yesterday as infl ation continues

to undershoot its target but explicitly acknowledged the vigour of the eu-rozone economy, now on its best run since the global fi nancial crisis.

The ECB maintained its bias for fur-ther policy easing, leaving the door open to further rates cuts or an increase in asset buys.

This is in line with market expecta-tions but at odds with calls from Ger-many, the eurozone’s economic pow-erhouse, for a gradual reduction of stimulus.

“Incoming data since our meeting in March confi rm that the cyclical recov-ery of the euro area economy is becom-ing increasingly solid and that down-side risks have further diminished,” ECB president Mario Draghi told a news conference.

“At the same time, underlying infl a-tion pressures continue to remain sub-dued and have yet to show a convincing upwards trend,” he added, justifying the continued stimulus measures.

However, in response to a reporter’s question, Draghi noted there had been a debate among ECB council members over the eurozone growth outlook, with some “more sanguine” than oth-ers.

That, he added, had resulted in a line being added to his introductory state-ment which noted that downside risks to the growth outlook “relate predomi-nantly to global factors”.

The euro weakened slightly against the dollar following the rates decision after trading near six-month highs, aided by expectations that Macron would win the French presidential vote on May 7.

The subtle tweak in language will be seen by some observers as foreshad-owing a more bold change at the next meeting in June, possibly including a removal of a phrase signalling a bias for more policy easing.

Eurozone economic sentiment hit a 10-year high this month and political risk is receding after pro-euro centrist Emmanuel Macron won the fi rst round of France’s presidential vote.

Elsewhere, the Bank of Japan, also operating deep in unconventional ter-ritory, off ered its most optimistic as-sessment of the economy in nine years yesterday but signalled that it would maintain its massive stimulus eff ort.

Sweden’s Riksbank also extended

its own asset buys by 15bn crowns ($1.70bn) yesterday, predicting the fi rst rate hike in the middle of 2018, later than earlier projected.

Having missed its 2% infl ation tar-get for years and even fl irting with defl ation, the ECB is buying €60bn worth of bonds per month at least until the end of the year and plans to keep interest rates in negative territory until later.

But economic growth is steadily

picking up pace, inflation is comfort-ably above 1% and the ECB’s policy arsenal is nearly depleted, all fuelling calls by conservative policymakers to start mapping out the way to the exit.

Draghi said, however, that infl ation was still not fi rmly in place.

“We have not seen suffi cient evi-dence to alter our assessment of the infl ation outlook, and we are not suf-fi ciently confi dent that infl ation will converge to levels consistent with our infl ation aim in a durable and self-sus-taining manner,” said.

Draghi did say, however, that the risk of defl ation had virtually disappeared.

In a departure from the bank’s long-held, more pessimistic stance, ECB board member Benoit Coeure, a key ally of Draghi, last week argued that the balance of risk for the economy is now largely balanced.

Coeure’s view may not signal an imminent policy shift but suggests growing confidence in the outlook and a willingness to entertain the once-taboo subject of scaling back stimulus.

Last month, the ECB removed one phrase from the statement — a pledge to act “using all the instruments avail-able within its mandate” if needed, sig-nalling a diminishing urgency for more policy action.

Some or all the references to prevail-ing downside risks to the outlook, to the possibility of further rate cuts or to larger asset purchases may be taken out, sources with direct knowledge of the bank’s deliberations have told Reuters.

Policymakers are likely to remain cautious, however, particularly those from the periphery of the bloc, where unemployment is high and wages are not rising.

“Before getting too enthusiastic, not all is well in the eurozone,” ING econo-mist Carsten Brzeski said before the decision.

A euro currency symbol sits on a eurosystem sign outside the the European Central Bank (ECB) headquarters in Frankfurt. The ECB maintained its bias for further policy easing yesterday, leaving the door open to further rates cuts or an increase in asset buys.

Riksbank’s surprise decision to boost stimulus splits boardBloombergStockholm

Sweden’s central bank in a split decision

unexpectedly extended its bond buying

programme into the second half of the

year and delayed any potential tightening

as policy makers take no chances on infla-

tion backsliding.

The Riksbank yesterday prolonged its

quantitative easing beyond June and will

buy a total of 15bn kronor ($1.7bn) in nomi-

nal government debt and inflation-linked

debt. The move was opposed by three

members on its six-person board and was

only anticipated by one of Sweden’s top

five banks. Policy makers also delayed any

rate increases until the middle of 2018,

while keeping their key rate at a record

low of minus 0.50%. The bank’s forecasts

suggest rates will stay negative at least

into 2019.

“To support the upturn in inflation,

monetary policy needs to be somewhat

more expansionary,” the bank said. “The

considerable uncertainty over economic

and political developments abroad is also

important for the stance of monetary

policy.”

The krona slid 0.8% to 9.626 per euro

as of 10:54am in Stockholm. Swedish

two-year yields fell 2 basis points to minus

0.63% while five-year yields dropped

below zero again.

After being derided as “sadomonetar-

ists” three years ago for keeping rates too

high, the bank, led by Governor Stefan

Ingves, is now showing considerable

resolve in its all-out off ensive to deliver on

its main mission of price stability. Having

come in below the central bank’s 2% target

for more than six years, inflation again

disappointed in March, with the headline

rate falling to an annual 1.3%.

“There’s yet no evidence of rising core

inflation and the low wage agreements will

probably hold back domestic inflation,”

Andreas Wallstrom, an analyst at Nordea

Bank, said in a note.

“Without a substantial pick-up in prices

globally, inflation will therefore most

likely continue to be a challenge for the

Riksbank.”

The decision was also unexpected as

the krona has been weaker than the bank

anticipated amid a nascent global tighten-

ing drive. The European Central Bank is

laying the groundwork for an end to its

own bond buying programme on signs of

an economic recovery in the euro area,

while the Federal Reserve is expected to

continue raising rates this year.

The expansion of stimulus in Sweden

is likely to be controversial as house

prices have been rising at a fast clip and

the economy is running on all cylinders.

Reports just this week showed unemploy-

ment dipping to an eight-year low and

manufacturing confidence reaching the

highest in more than two decades.

Ingves had to use his tie-breaking

power since three of the six board mem-

bers, Martin Floden, Henry Ohlsson and

Cecilia Skingsley entered reservations

against extending the bond purchases.

“They consider that monetary policy does

not need to be made more expansionary

in the current economic situation,” the

bank said.

Concerns have also been growing over

the impact of liquidity on the bond market.

The Riksbank has snapped up more than

40% of the market and will by the end of

2017 have purchased about 290bn kronor

in bonds.

While the additional stimulus was

unexpected, the message from the bank

wasn’t completely tilted toward easing.

The pace of bond purchases was scaled

back from 30bn kronor in the current six-

month period and some of the easing bias

was removed in the rate outlook. It now

sees a rate trough of minus 0.53% through

the first quarter of next year versus minus

0.56% in February.

RBS settles with more investors over 2008 cash call lawsuitReutersLondon

Royal Bank of Scotland has reached an out-of-court settlement with another

batch of shareholders who al-leged they were misled during a £12bn ($15.5bn) cash call in 2008, the state-owned bank said yesterday.

The latest settlement, which follows a similar deal struck with four other investor groups last year, leaves a rump party of investors claiming damages of around £520mn, excluding in-terest and costs, weeks before a trial is scheduled, one source fa-miliar with talks said.

The deal has splintered the vast RBoS Shareholder Action Group, with 40% of the value of the original claimants now set-tled.

“We are pleased that some members of our group have been able to come to an agree-ment with the bank,” said the shareholder group, which still represents around 27,000 retail investors and around 20 insti-tutions.

“However, we remain resolute in our fi ght for justice for retail shareholders and the numer-ous institutions that remain in this litigation,” said the group, which represents thousands of current and former RBS share-holders.

Shareholders lost around 80% of their investment after buy-ing into RBS’s rights issue as the credit crisis raged in 2008, shortly before the bank almost collapsed and received a £45bn government bailout.

Edinburgh-based RBS said it had now reached a full and fi nal settlement with shareholders representing 87% of the original claims by value in the litigation — without any admission of li-ability.

“We are pleased to have reached this agreement,” Ross McEwan, chief executive of RBS said in a statement.

RBS last year set aside £800mn to settle investor claims totalling around £4bn from fi ve investor groups in an unprec-edented lawsuit over alleged omissions and misrepresenta-tions about its fi nancial strength when it launched the rights issue during the credit crisis.

US business spending likely gained momentum in fi rst quarterReutersWashington

New orders for US-made capital goods rose less than expected in March, but a second straight

monthly increase in shipments sug-gested business investment accelerated in the fi rst quarter amid a recovering energy sector.

While other data yesterday showed a bigger-than-expected increase in fi rst-time applications for unemployment benefi ts last week, the trend in claims remained consistent with tightening labour market conditions.

The Commerce Department said non-defence capital goods orders ex-cluding aircraft, a closely watched proxy for business spending plans, increased 0.2% last month after gain-

ing 0.1% in February. Orders for these so-called core capital goods have now increased for six consecutive months.

Shipments of core capital goods rose 0.4% after jumping 1.1% in February.

Core capital goods shipments are used to calculate equipment spending in the government’s gross domestic product measurement.

“Business investment appears to have some better momentum early in 2017 and, while growth is far from hot, we appear to be transitioning away from the declines that plagued much of 2016,” said Robert Kavcic, a senior economist at BMO Capital Markets in Toronto.

Economists had forecast core capital goods orders rising 0.5% last month.

The dollar rose marginally against a basket of currencies, while US stocks were little changed. Prices for US

Treasuries were trading mostly high-er.

March’s small increase in core capital goods orders suggests moderate busi-ness investment growth in the second quarter.

It also implies a moderation in the manufacturing sector activity after re-cent strong growth.

Manufacturing, which accounts for about 12% of the US economy, could get a lift from President Donald Trump’s proposed tax plan, announced on Wednesday, that includes cutting the corporate income tax rate to 15% from 35%. For now, manufacturing is being underpinned by the energy sector re-vival.

Energy services fi rm Baker Hughes said last Friday that US oil rigs totalled 688 in the week ending April 21, the most in two years.

US drillers have added oil rigs for 14 straight weeks and shale production in May was set for its biggest monthly in-crease in more than two years.

Overall orders for durable goods, items ranging from toasters to air-craft that are meant to last three years or more, increased 0.7% after surging 2.3% in February.

Business spending on equipment is expected to have accelerated from the fourth-quarter’s annualised 1.9% growth pace and will likely be one of the few bright spots when the government publishes its advance fi rst-quarter GDP estimate today.

Other data from the Commerce De-partment yesterday showed the goods trade defi cit widening 1.4% in March.

Though retail inventories increased 0.4% last month, stocks of goods at wholesalers dipped 0.1%. In the wake

of the data, the Atlanta Federal Re-serve cut its fi rst-quarter GDP growth estimate by three-tenths of a percent-age point to a 0.2% rate, which would be the weakest performance in three years.

The economy grew at a 2.1% pace in the fourth quarter.

With the labour market near full em-ployment, the anticipated slowdown in growth likely understates the health of the economy.

In a separate report yesterday, the Labor Department said initial claims for state unemployment benefi ts rose 14,000 to a seasonally adjusted 257,000 for the week ended April 22.

Claims have now been below 300,000, a threshold associated with a healthy labour market, for 112 straight weeks.

That is the longest such stretch since

1970, when the labour market was smaller. Economists had forecast fi rst-time applications for jobless benefi ts rising to 245,000 last week.

“Despite this week’s rise, we believe that the labour market remains solid and see no pattern in the underlying state data to give us pause on that as-sessment,” said Rob Martin, an econo-mist at Barclays in New York.

The four-week moving average of claims, considered a better meas-ure of labour market trends as it irons out week-to-week volatility, fell 500 to 242,250 last week, the lowest level since February.

Other data from the National As-sociation of Realtors showed contracts to buy previously owned homes fell 0.8% in March, suggesting a persistent shortage of properties could hurt sales for the rest of the spring season.

UiPath raises $30mn as battle for enterprise AI heats upBloombergLondon

UiPath, a New York-based company that uses computer-vision to automate repetitive business processes involving software, has raised $30mn to help expand globally.The move comes as companies increasingly look to artificial intelligence to solve the sorts of routine tasks, such as checking invoices and inputting data from human resource forms into databases, that they once outsourced to low-cost human contractors.The London off ice of venture capital firm Accel lead the investment round. Accel, which did well backing consumer-facing startups and companies building market-place business models in Europe

over the past decade, has increasingly shifted to investments in enterprise software startups, many of them employing some form of machine learning or artificial intelligence.Earlybird Venture Capital, Credo Ventures and Seedcamp also participated in the funding round.UiPath’s software uses computer-vision — a branch of artificial intelligence that involves the extraction, analysis and understanding of visual information in images — to observe a set of tasks being performed on a user’s machine. It can then replicate these tasks automatically, a bit like the way macros work in Microsoft Excel. The diff erence is that UiPath’s software, unlike most macros, can carry out tasks across any software the business is using. In addition, users can train the tool with a set of rules or steps for analysing the data it is handling. For instance, it

could look up data from an SAP system, check if it meets certain conditions, and then input it into a Salesforce database.One big advantage of such software over humans, is that they follow the same steps and rules exactly every time, without getting tired, making errors or skipping procedures.“From a compliance perspective it makes a lot of sense because the software will log every step and if you need to go back and audit what happened you can,” Luciana Lixandru, the Accel partner who led the investment in UiPath, said in an interview. “That means this can work well in highly-regulated industries like finance, healthcare and insurance.”UiPath says that it has 200 customers, including Lufthansa, Generali, Telenor and Dong Energy. It also has partnerships with consulting firms

Deloitte and Capgemini, which often recommend its products to their clients.The market for what is known as robotic process automation software is expected to reach $8.75bn annually by 2024, up from about $125mn in 2015, tech research firm Grand View Research wrote in an October 2016 report. Grand View estimated that these software solutions are, on average, 60% cheaper than using humans to perform the same tasks and cost 30% less than using contractors in low-paid countries, such as India.Software like UiPath is increasingly threatening large business process outsourcing firms like Cognizant, Infosys and Tata Consultancy Services, which have announced layoff s as customers have increasingly turn to automation and software over human contractors.