Monday, February 1, 2016

Facebook-owned WhatsApp boasts a billion users

Facebook-owned WhatsApp boasts a billion users

[SAN FRANCISCO] Facebook-owned smartphone messaging service WhatsApp has hit the billion-user mark, according to the leading social network's chief and co-founder Mark Zuckerberg.
"One billion people now use WhatsApp," Mr Zuckerberg said in a post on his Facebook page.
"There are only a few services that connect more than a billion people." Google's free email service, Gmail, is the latest of the Internet giant's offerings to crest the billion-user mark, chief Sundar Pichai said Monday during an earnings call.
The ranks of people using WhatsApp have more than doubled since California-based Facebook bought the service for US$19 billion in late 2014, according to Mr Zuckerberg.
"That's nearly one-in-seven people on Earth who use WhatsApp each month to stay in touch with their loved ones, their friends and their family," the WhatsApp team said in a blog post.
After buying WhatsApp, Facebook made the service completely free. The next step, according to Mr Zuckerberg, is to make it easier to use the service to communicate with businesses.
Weaving WhatsApp into exchanges between businesses and customers has the potential to create revenue opportunity for Facebook.
Recent media reports have indicated that Facebook is working behind the scenes to integrate WhatsApp more snugly into the world's leading social network by providing the ability to share information between the services.
AFP

Yahoo's employee ranking targeted in mass termination lawsuit

Yahoo's employee ranking targeted in mass termination lawsuit

[SAN FRANCISCO] Yahoo! Inc. was accused in a lawsuit of manipulating employee performance evaluations to justify firing hundreds of workers in order to meet its financial targets.
Gregory Anderson, who was an editor for some of Yahoo's online news content, claims he and about 600 others at the company were unfairly fired in 2014 after managers retooled a numerical ranking system to downgrade their performance.
The mass terminations occurred without appropriate notice in violation of state and federal laws, according to the complaint filed Monday in federal court in San Jose, California. Anderson also accused the company of gender discrimination under the US Civil Rights Act of 1964, citing internal promotions he said were limited to female candidates.
"The employees were never told their actual metric numeric ranking or how it had been determined," according to the complaint. The quarterly performance rating process "therefore permitted and encouraged discrimination based on gender and any other personal bias held by management."
California law requires that the termination of 50 or more employees within a month occur with a 60-day notice period.
Mr Anderson was told by Yahoo that he was fired while attending a journalism fellowship at the University of Michigan granted with the support of the company, according to the complaint. He said he was informed the decision was effective immediately.
Suzanne Philion, a spokeswoman for Sunnyvale, California- based Yahoo, defended the company's performance review process, saying "fairness is a guiding principle." "We believe this process allows our team to develop and do their best work," Ms Philion said in a statement. "Our performance review process also allows for high performers to engage in increasingly larger opportunities at our company, as well as for low performers to be transitioned out." Ms Philion also said Mr Anderson sent a letter Jan 21 demanding that the company pay him US$5 million.
"Yes, we itemized the damages at US$5 million," Jon Parsons, Mr Anderson's lawyer, said in a phone interview while referring to the nine-page letter he sent Yahoo. "They are posturing. When you don't have anything substantive to say about the facts, you try to discredit the plaintiff."
More firings are expected at Yahoo as part of Chief Executive Officer Marissa Mayer's effort to cut costs and revive growth at the struggling web portal. Now more than three years into her turnaround campaign, Ms Mayer is looking for new ways to bolster growth and beat back competition from rivals, while enduring investor scrutiny including the handling of stake in Alibaba Group Holding Ltd.
Details on Ms Mayer's plans are set to be unveiled on Tuesday along with Yahoo's quarterly earnings.
The lawsuit was reported earlier by the New York Times.
BLOOMBERG

South Korea to unveil stimulus steps as inflation, exports falter

South Korea to unveil stimulus steps as inflation, exports falter

[SEOUL] The South Korean government will unveil stimulus measures on Wednesday as a collapse in exports and cooling inflation threaten a fragile economic recovery.
As a slowdown in China weighs on global growth, knocking export-reliant economies from Brazil and Europe to Japan and Indonesia, Finance Minister Yoo Il-ho said Seoul will take steps to boost faltering momentum in Asia's fourth-largest economy.
"External uncertainties have increased since the start of the year due to volatile Chinese stocks, falling oil prices and negative interest rates adopted by the Bank of Japan," Mr Yoo told a meeting of business lobby groups on Tuesday. "Tomorrow we will announce measures to support the economy in the first quarter."
Underscoring the minister's concerns, data released on the day showed South Korea's annual inflation rate cooled to its lowest in four months in January.
That followed downbeat data on Monday showing annual exports in January slumping over 18 per cent, with sales to China collapsing and adding pressure for more easing steps to restore economic momentum.
The consumer price index rose 0.8 per cent in January from a year earlier, Statistics Korea said, down from a 1.3 per cent increase in December and the slowest rise since a 0.6 per cent gain in September last year.
The CPI increase was slightly lower than the median 0.9 per cent projected in a Reuters survey.
Analysts say the government stimulus measures will probably be aimed at job growth and not involve additional public spending.
"Inflation last month was bad...Exports were also terrible in January but we need to take time to see if this was a temporary blip." said Park Seok-gil, economist at JP Morgan Chase and Co.
"It won't be easy for the government to take big steps right now."
Treasury bond yields slipped to record lows on Monday after the gloomy exports data.
January inflation was mainly dragged down by industrial products, the index for which was down 0.8 per cent on-year - the fastest decline since February last year.
Services gained 2.4 per cent from a year ago in January, in a glimmer of hope that consumption is still on the mend.
The Bank of Korea is widely expected to leave its policy rate at the current record-low 1.50 per cent at the next meeting on Feb. 16. However, analysts say the pressure for cuts is growing especially as growth remains sub-par.
Core inflation in January, for instance, was at 1.7 per cent, the lowest since December 2014.
REUTERS

Currency traders struggle to translate bad volatility into profit

Currency traders struggle to translate bad volatility into profit

[TOKYO] Currency traders are getting whiplash from the pile-up of policy surprises that have come their way in the past six months. And because the big events have been unexpected, they're struggling to translate rising volatility into bigger profits.
The Bank of Japan's decision to adopt negative interest rates, a week after Governor Haruhiko Kuroda said they weren't being considered, was the latest jolt.
The yen's 1.9 per cent drop after the move was its biggest in more than a year, yet it paled in comparison to the euro's 3.1 per cent surge when the European Central Bank failed to impress with its December stimulus boost. China has switched policy several times since it devalued the yuan in August.
Swings in these currencies helped push JPMorgan Chase & Co.'s G-7 Volatility Index up by 7 per cent since Dec 31, yet investors have made less than 0.4 per cent, based on a Parker Global Strategies LLC gauge that tracks top foreign-exchange funds.
It's a frustrating start to the year for traders: while they need volatile markets to make money, they can't capitalise on moves they don't see coming. They're hoping to do better than in 2015, when returns dwindled amid a series of policy surprises from Switzerland ditching its currency cap to the Federal Reserve raising rates later than some expected.
"While some volatility is always good for the market for sure, unforeseen policy-induced volatility can be very damaging," said Alvin Tan, a London-based strategist at Societe Generale SA.
The BOJ announcement last week "was a shock and caught a market that was increasingly long-yen. It hurt a lot of people."
JPMorgan's gauge of anticipated price swings was at 9.86 per cent on Monday in New York, up from 9.23 per cent at the end of last year. Last month, it posted its biggest increase since August.
The Parker index of 14 currency funds fell on Jan. 28 to the lowest level since the start of 2016. It dropped 0.9 per cent on Dec. 3, the most since the measure began in 2003, when the reaction to an extension of the ECB's quantitative-easing program sent the euro surging by the most in 6 1/2 years.
The euro touched an eight-month low of US$1.0524 that day, and has since rebounded. The yen slumped to a more than one- month low of 121.69 per dollar after the BOJ announcement on Friday, about a week after reaching its strongest level in a year. Europe's common currency rose 0.1 per cent to US$1.0897 as of 10:05 am in Tokyo, while the yen gained 0.1 per cent to 120.91 per dollar.
Markets must now grapple with whether to accept ECB President Mario Draghi's Jan 21 assurance of further stimulus, and how much further Kuroda can expand efforts to stoke Japan's economy. Futures prices suggest traders doubt the Fed's projected four rate increases before 2016 is out.
"There's plenty of scope for more market whipsaws this year driven by policy makers," said Sean Callow, a foreign-exchange strategist in Sydney at Westpac Banking Corp. China's clampdown on speculators betting against the yuan "can't be maintained indefinitely," and "markets have been aggressive in pricing out Fed hikes, so there's plenty of scope for reappraisal there too."
The ECB's meetings have been "reliable sources of volatility," said Callow, who predicts BOJ policy will be constantly questioned, stoking yen price swings.
The BOJ announcement caught speculators unawares, with bullish yen bets in the run-up to the decision reaching the most since 2012, according to the Commodity Futures Trading Commission.
Goldman Sachs Asset Management said that day it removed a short-yen position on the assumption the central bank would disappoint investors by how far it was willing to ease policy.
Another Asian imponderable is China.
Markets have already grappled with two episodes when the PBOC devalued the yuan only to push back against bears later. Both instances - in August and late December through January - caused a sell-off in currencies dependent on Chinese growth such as the Australian and Canadian dollars.
"Currency flexibility is a good thing in general, helping keep the economy balanced," said Greg Gibbs, director of Amplifying Global FX Capital in Breckenridge, Colorado. "But it's not immediately clear that pursuing a weaker exchange rate will be in the interests of China. Or the global economy."
Officials are being driven to action, or - potentially - inaction in the US's case, as a rout in equity and commodities markets compounds concern global growth is slowing. The varying policy stances in the world's biggest economies are aggravating foreign-exchange moves and stoking speculation about competitive devaluations, known as a currency war.
Neil Mellor, a London-based strategist at Bank of New York Mellon Corp., wrote Jan 29 that he sees the BOJ decision to join the negative-interest-rate club "in the context of a race to the bottom for monetary policies globally, and against a backdrop in which a number of central banks are contemplating their own easing measures despite the growing threat to financial stability."
BLOOMBERG

Oil prices slide as output cut hopes fade

Oil prices slide as output cut hopes fade

[LONDON] Oil prices slumped on Monday as traders took profits on receding prospects of an imminent cut to the global supply glut.
Prices hit three-week highs earlier Monday, building on last week's strong gains driven by dollar weakness and after Russia said it could meet the OPEC producers' group for talks on possible output cuts.
But they sharply reversed direction as analysts further doubted a looming reduction in the amount of oil being pumped out by leading producers.
Around 1700 GMT, US benchmark West Texas Intermediate for delivery in March slumped to US$31.84 a barrel, down US$1.78 compared with Friday's close.
Brent North Sea crude for April delivery shed US$1.46 to US$34.53.
Brent had earlier Monday struck a three-week high at US$36.25 before profit-taking took hold.
"Crude oil has started the new week on the back foot, giving back a big chunk of the sharp gains made in the previous couple of weeks," said Fawad Razaqzada, analyst at City Index.
"Profit-taking is one of the main reasons for the oil price drop today," he added.
Analysts cautioned against putting too much hope on talks between non-Opec crude producer Russia and the cartel on reducing output in a move that could support prices.
Crude futures have crashed by about three quarters since mid-2014 owing to global oversupply, weak demand growth and strong dollar.
But both contracts surged Thursday after Russian reports that Energy Minister Alexander Novak had said Moscow was ready to take part in talks with Opec to establish possible "coordination".
He said the discussions could be on making production cuts of up to five percent per country.
"Oil has stopped its bullish momentum and most of the reason comes from the relatively strong dollar on light of Japan's surprising negative interest rate decision," said Phillip Futures analyst Daniel Ang.
As oil is traded in dollars, a rise in the greenback makes crude more expensive for holders of weaker units, dampening demand.
Oil prices closed higher last week to end a turbulent January in which prices plunged to 12-year lows.
The dollar has meanwhile gained support after Japan's central bank shocked markets Friday with a decision to adopt a below-zero interest rate policy to spur bank lending and drive up inflation.
Bank of Japan chief Haruhiko Kuroda cited recent financial market turmoil and a China slowdown for ushering in a -0.1 per cent rate on new reserves, and said the bank may go even further into negative territory.
AFP

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