Xiaomi said to consider laptop for 2016, aiming at Apple

Xiaomi Corp is considering the introduction of its first laptop early next year, people with direct knowledge of the matter said, opening a new front in its battle against Apple Inc and Lenovo Group Ltd. 

PHOTO: BLOOMBERG

SEP 2, 20154:50 PM

[SEOUL] Xiaomi Corp is considering the introduction of its first laptop early next year, people with direct knowledge of the matter said, opening a new front in its battle against Apple Inc and Lenovo Group Ltd.

Xiaomi's notebook may go on sale in the first quarter to compete with such premium computers as Apple's MacBook Air and Lenovo's ThinkPad, the people said, asking not to be identified because the matter is private. Xiaomi has held talks with Samsung Electronics Co to supply memory chips, and that initial agreement may extend to providing displays, the people said.

Only five years after its founding, Xiaomi vaulted into the global smartphone industry's top ranks by providing stylish devices with premium components at mid-range prices. Xiaomi getting into the PC business risks bringing additional cost pressures against industry leaders Lenovo, Hewlett-Packard Co and Apple.

Xiaomi, the fourth-largest smartphone vendor, will boost Samsung's components business as its tries to reduce reliance on providing for its own Galaxy devices.

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Samsung and Xiaomi declined to comment in separate e-mails.

Lenovo dropped to a three-year low in Hong Kong trading, falling 2.5 per cent to HK$6.13. Samsung rose 0.5 per cent to 1,090,000 won in Seoul.

Xiaomi's trying to carve out a spot in a rapidly shrinking market. IDC forecast in August an 8.7 per cent slide in 2015 PC shipments and doesn't expect a return to growth till 2017.

Smartphone Success The Chinese company co-founded by billionaire Lei Jun made its mark with cheaper smartphones sold online before moving into higher-end devices, buoyed by a thriving online community. Until now, its other hardware forays have been confined to sales of appliances and accessories such as earphones and TVs.

Xiaomi's venture into PCs comes as growth in its core market winds down. Worldwide smartphone sales recorded their slowest growth rate since 2013 in the second quarter of 2015, according to Gartner. A rapidly maturing home market has prompted Xiaomi to look toward India, Brazil and other less- saturated smartphone arenas.

Samsung too is grappling with slowing sales of its own high-end Galaxy range and in July, it posted a fifth straight drop in quarterly profit.

BLOOMBERG

    
 

US: Stocks rebound after steep losses: S&P +1.1%

US stocks opened more than one per cent higher Wednesday, partly erasing Tuesday's steep losses driven by worries over China's economy.

PHOTO: REUTERS

SEP 2, 20159:39 PM

[NEW YORK] US stocks opened more than one per cent higher Wednesday, partly erasing Tuesday's steep losses driven by worries over China's economy.

Five minutes into trade, The Dow Jones Industrial Average was up 1.23 per cent, while the S&P 500 added 1.12 per cent and the Nasdaq Composite gained 1.26 per cent.

AFP

China futures exchange further tightens rules on stock index futures trading

The China Financial Futures Exchange said on Wednesday it would take further steps to curb excessive speculation in stock index futures trading, in its second tightening of rules in less than a week. 

PHOTO: EPA

SEP 2, 20158:24 PM

[SHANGHAI] The China Financial Futures Exchange said on Wednesday it would take further steps to curb excessive speculation in stock index futures trading, in its second tightening of rules in less than a week.

Starting from September 7, margin requirements for non-hedging futures contracts will rise to 40 per cent of contract values from 30 per cent now, the exchange said on its microblog Weibo feed.

Margin requirements for hedging futures contracts will also rise to 20 per cent from 10 per cent.

Last week, the China Securities Regulatory Commission said the futures exchange would raise requirements for non-hedging futures contracts to 30 per cent of contract values from Monday.

REUTERS

      

Templeton's Mark Mobius says China's stock selling curbs "alarming"

Franklin Templeton's Mark Mobius said China's action to stop investors from liquidating their stock market bets was "alarming" but the emerging market specialist also said the country had not become so risky that he would walk away. 

PHOTO: SPH

SEP 2, 20156:48 PM

[LONDON] Franklin Templeton's Mark Mobius said China's action to stop investors from liquidating their stock market bets was "alarming" but the emerging market specialist also said the country had not become so risky that he would walk away.

China has been trying to cope with a slowing economy and volatile stock markets and has cut interest rates and relaxed bank lending restrictions. The country has also cracked down on short sellers.

"What is alarming is the imposition of rules and regulations which prevent investors from liquidating positions," Mr Mobius, executive chairman of Templeton Emerging Markets Group, said.

"One example would be the "short swing" rule which has prevented the selling of Chinese securities when a certain holding size is reached," he told Reuters in an e-mail.

The US$8.5 billion Templeton Asian Growth Fund that Mobius manages invested 23.8 per cent of its assets in China at the end of July, below a 28.3 per cent weight of the country's shares in its benchmark MSCI AC Asia ex-Japan Index.

China is also probing potential market manipulation following the plunge in its stock markets since mid-June.

Mr Mobius said it was no surprise that Chinese authorities were summoning market participants to look into the reasons behind the steep fall in its share markets.

Mr Mobius also said that China was pumping liquidity into its markets to prevent a downturn but a move to put pressure on companies to buy back their own shares was not a good idea.

"I believe the authorities in China are learning and this process is on-going regarding how to handle market behaviour," Mr Mobius said. "They definitely want to transform China into a market economy and given that intention, I think they will not continue to try to impose drastic controls."

REUTERS

    
 

US banks posted record profits in second quarter, FDIC says

US lenders earned a record US$43 billion in profits for the second quarter - a 7.3 per cent increase from a year ago, the Federal Deposit Insurance Corp said on Wednesday. 

PHOTO: BLOOMBERG

SEP 2, 201511:25 PM

[WASHINGTON] US lenders earned a record US$43 billion in profits for the second quarter - a 7.3 per cent increase from a year ago, the Federal Deposit Insurance Corp said on Wednesday.

Higher revenue at more than two-thirds of banks and lower litigation costs pushed net income to a level that exceeded the previous mark set in 2013 by US$2.6 billion, the agency said in its report on industrywide performance.

Loan balances rose by US$185 billion during the quarter, including a US$25 billion increase in residential mortgages and US$49 billion in commercial and industrial lending. Meanwhile, trading income fell 14.1 per cent, the FDIC said.

Net charge-offs declined for a 20th consecutive quarter, falling 11 per cent from a year earlier to the lowest level since the third quarter of 2006, before the credit crisis.

FDIC Chairman Martin Gruenberg said in a statement that the agency continues to be concerned about the industry's vulnerability to interest-rate risk, noting that net interest margins are "under pressure" as maturing high-yield assets are replaced with investments with lower yields.

BLOOMBERG

    
 

Indonesia to cut emission by 29% in 2030

SEP 2, 20159:37 PM

[JAKARTA] Indonesia has unveiled an ambitious new target for reducing carbon emissions, promising to slash its greenhouse gas output by 29 per cent by 2030, the government said on Wednesday.

The increased commitment by one of the world's largest greenhouse gas emitters will be officially submitted to the United Nations later this month ahead of a major climate change summit in December.

"We have reached the decision to reduce (emissions) by 29 per cent by 2030," environment and forestry minister Siti Nurbaya Bakar told reporters.

The pledge goes beyond Indonesia's 2009 agreement to slash emissions by 26 per cent - or 41 per cent with international assistance - by 2020.

The final draft submission states Indonesia has set aside 12.7 million hectares (31.4 million acres) of forest for conservation to help realise its target. The government also hopes to derive nearly a quarter of its vast energy needs from renewable sources within a decade.

"Beyond 2020, Indonesia envisions an even bolder commitment to emission reductions," said the draft submission distributed by the ministry.

Indonesia, along with several other emissions-intensive economies, had been under pressure to submit its target before the UN climate summit in Paris.

"The Indonesia baseline uses the business as usual scenario of emission projections starting in 2010, based on historical trajectory (2000-2010), projected increases in the energy sector, and the absence of mitigation actions," the submission says.

It is hoped that a new pact to cut global emissions applicable to all countries will be hammered out at the long-awaited conference.

AFP

    
 

Asian consumers missing out on full benefit of crude oil slump

Conventional wisdom is that falling oil prices provide significant economic stimulus, but many Asian countries appear to be missing out on much of the benefit. 

PHOTO: AFP

SEP 2, 20158:09 PM

[LAUNCESTON, Australia] Conventional wisdom is that falling oil prices provide significant economic stimulus, but many Asian countries appear to be missing out on much of the benefit.

While Brent crude has dropped 51.7 per cent in the past 12 months, the retail prices of gasoline and diesel in major countries across the region haven't fallen by anything like as much.

China, the world's largest crude importer, dropped the retail ceiling price of gasoline by 125 yuan (US$19.64) a tonne from Wednesday, taking it to 6,830 yuan a tonne.

The retail ceiling for diesel was lowered by 120 yuan a tonne to 5,790 yuan, the sixth straight price cut since June.

However, since September last year, the retail ceiling for gasoline has dropped 24 per cent and by 29 per cent for diesel.

While this is a reasonable reduction, it's still only about half of what crude oil has declined in dollar terms.

As far as China goes, the blame can't be put on currency depreciation, even taking into account the sudden weakening of the yuan recently.

In yuan terms Brent has lost 50 per cent of its value in the past year, only slightly less than the loss in dollar terms.

While there have been increases in fuel taxes in China, they are nowhere near high enough to explain the gap between the decline in the price of oil and that for refined fuels.

It would seem the most logical explanation is that the windfall from cheaper crude is being used to prop up refiners'margins, rather than to stimulate the economy through cheaper transport costs.

In India, currency depreciation explains more, but not all of the disparity between crude and fuel pricing.

Retail gasoline prices in India were cut by 3.2 per cent in rupee terms as of Tuesday, taking them down to 61.20 rupees per litre (92.2 US cents), while diesel dropped 1.1 per cent to 44.45 rupees.

This takes the decline in gasoline prices to 10.6 per cent since September last year, again well short of the halving of crude prices, while diesel fared better, with a 24.6-per cent fall.

But the rupee has slumped by 9.7 per cent over the same period, meaning that in rupee terms Brent dropped 47 per cent over the past 12 months.

Again, it seems consumers in the world's second-most populous country aren't getting the whole benefit of the drop in oil prices, with margins at the mainly state-controlled refiners likely being boosted.

In Indonesia, the largest economy in Southeast Asia and the third most populous country in Asia, consumers haven't seen any benefit from lower crude.

Indonesia still has some of the cheapest fuel prices in the world and it removed most of its subsidies at the start of this year.

Currently gasoline costs around 7,300 rupiah (52 cents) a litre and diesel 6,900 a litre, up from 6,500 rupiah for gasoline and 5,500 for diesel last year, prior to the scrapping of all but a 1,000 rupiah a litre subsidy for diesel.

The rupiah has dropped about 20.5 per cent against the dollar over the past 12 months, meaning the price of Brent has slipped about 42 per cent in rupiah terms.

Since the retail prices have actually risen, this means the difference has gone to the government in the form of lower subsidies, and to help fund the losses of almost US$1 billion racked up by the state energy company Pertamina in the past year.

Even in an unregulated and competitive market such as Australia, there is a large gap between the decline at the petrol pump and the fall in crude oil.

The national average gasoline price for the week to Aug 30 was 130.9 Australian cents (93.2 cents) a litre, and 131.2 cents for diesel, according to the Australian Institute of Petroleum.

For gasoline this is down 11 per cent from a year ago and for diesel the decline is 15.2 per cent.

The Australian dollar has dropped 25 per cent against the greenback in the past 12 months, while the price of Brent has fallen 36 per cent in Australian currency terms over the same period.

There has been a minor increase in fuel taxes in Australia, but this was less than 1 cent a litre, meaning that once again it appears that much of the drop in crude prices has stayed in the refining, transportation and retailing system rather than reaching the pockets of motorists.

While the dynamics vary between countries in Asia, the common thread is that nowhere is the full benefit of low oil prices being felt.

Perhaps with the economic growth concerns in China, which threaten the rest of the region, starting to become more pronounced, it would be better to have cheaper fuel for consumers rather than healthy margins for refiners and fuel retailers.

REUTERS

    
 

Opec oil output in Aug falls from record on Iraq disruption: survey

SEP 2, 201511:33 PM

[LONDON] Opec oil output fell in August from the highest monthly level in recent history, a Reuters survey found on Wednesday, as disruptions to flows on Iraq's northern pipeline halted supply growth from the group's second-largest producer.

Largely stable output from Saudi Arabia and other Gulf members of the Organization of the Petroleum Exporting Countries indicated they are not wavering in their focus on defending market share instead of prices.

Opec supply fell in August to 31.71 million barrels per day (bpd) from a revised 31.88 million bpd in July, according to the survey, based on shipping data and information from sources at oil companies, Opec and consultants.

Oil has weakened due to surging output and is trading below US$50, not far from a more than six-year low close to US$42 reached last month. Opec's shift to the market-share strategy in 2014, led by Saudi Arabia, deepened the decline.

Despite calls from some members for an emergency meeting, even Opec delegates who favour supply cuts do not expect any to be agreed, leaving a surplus which Opec's own numbers indicate is at least 2 million bpd on the market.

"I really see no chance for holding a meeting before the scheduled Dec 4 meeting, which will reach no concrete agreement to drastically cut production," said a delegate from one of Opec's African members. "We know that the present oversupply is more than 2 million barrels per day."

The decline in Opec output from July's level was the first since February based on Reuters surveys. Even so, Opec has boosted production by almost 1.5 million bpd since the November 2014 switch in policy to defend market share.

July's output from Opec's current 12 members was revised lower but is still the highest since Reuters records began in 1997. Opec output was above 32 million bpd in 2008 until Indonesia left the group at the end of the year.

The biggest drop in August came from Iraq, one of the main drivers of the rise in Opec output this year.

Exports from southern Iraq edged about 40,000 bpd lower to just above 3 million bpd, according to Iraqi officials and shipping data seen by Reuters.

Shipments from Iraq's north via Ceyhan in Turkey by Iraq's State Oil Marketing Organisation and the Kurdistan Regional Government posted a larger fall because of halts in the flow along the pipeline from Iraq, shipping data showed.

Top exporter Saudi Arabia kept output largely stable in August, sources in the survey said, following a decline in July. There was no significant change in the other major Gulf producers, Kuwait and the United Arab Emirates.

Nigerian exports rose in August according to loading schedules, although Royal Dutch Shell said on Aug 27 it shut two pipelines and declared force majeure on Bonny crude exports, which could have a larger impact in September.

Algeria posted a small increase after starting production at two fields and output in Iran, eager to reclaim its traditional spot as Opec's second-largest producer if and when sanctions are lifted, also edged up slightly.

Libyan production declined in August. Supply remains disrupted by unrest and negotiations to reopen closed oil facilities have yet to succeed.

REUTER
S