Tag Archives: climbs

Qantas climbs back to profit

Updated February 21, 2013 20:02:09

Qantas has bounced back from a steep full-year loss last financial year, to post a $111 million half-year profit.

The airline’s net profit after tax for the six months to the end of December 2012 jumped 164 per cent on the same period a year earlier, and was up from a $287 million loss in the previous half-year.

Underlying profit before tax, which also excludes most one-off costs and gains, was up more than 10 per cent on the same period last year to $223 million.

However, both the underlying and statutory profits include $125 million in revenue from an agreement negotiated between Qantas and Boeing in August 2012 to restructure the airline’s order for B787 Dreamliners.

The airline’s chief executive, Alan Joyce says the cancellation of 35 Dreamliners and the sale of its half share in road-freight venture StarTrack is paying off.

“Today’s result includes $125 million of compensation income from Boeing,” he said.

“This compensation settlement, negotiated by Qantas management, recognises the opportunity cost to our business incurred by the delay in the delivery of the 787s, which affected Jetstar, Qantas International and Qantas domestic.”

The major difference between underlying and statutory profit was $136 million in one-off “transformation costs”, as the airline restructures some of its businesses.

The company says all parts of its business were profitable in the half, except Qantas International which posted a before tax loss of $91 million.

However, it noted that its international division cut its losses by 65 per cent in the half compared with a year earlier.

The airline’s chief executive Alan Joyce says Qantas is now starting to reap the benefits of its restructuring program, which resulted in large short-term costs when management grounded the airline in response to staff industrial action.

“In total, the group achieved $172 million in transformation benefits in the first half of 2013,” he noted in the report.

“The operating environment remains complex and volatile, but we are now beginning to realise the benefits of the tough decisions that we have made over the past 18 months.”

Despite this improvement, Qantas has warned its outlook for the current six months remains challenging and volatile, and has declined to provide profit guidance due to uncertainty around fuel costs, competition, exchange rates and the global economy.

The airline has elected not to pay an interim dividend, but investors are still happy with the result, pushing Qantas shares up 4 per cent to $1.68 by 10:32am (AEDT).

Topics: business-economics-and-finance, company-news, air-transport, australia

First posted February 21, 2013 09:20:00

Wall Street climbs on hopes of cliff deal

Updated January 01, 2013 15:45:05

US stocks closed out the last trading day of the year on a high note this morning after president Barack Obama and Senate Republican leader Mitch McConnell said politicians were close to deal on the fiscal cliff.

The Dow Jones index was up 1.3 per cent at the unofficial close while the S&P 500 was up 1.7 per cent and the Nasdaq rose 2 per cent.

For 2012, the Dow rose 7.3 percent, while the S&P 500 climbed 13.4 per cent and the Nasdaq jumped 15.9 per cent.


Topics: markets, united-states

First posted January 01, 2013 08:23:03

KSE index climbs to all-time high of 16,251 points

KARACHI: The Karachi Stock Exchange’s (KSE) benchmark 100-index surged to an all-time high of 16,251 points with 12-week high turnover of 246 million shares on Monday due to significant across-the-board buying, said dealers on Monday.

Market capitalisation also surged to the record high of Rs4,056 billion with an addition of Rs13 billion, they added.“The volumetric buying in cement and textile stocks played a significant role in taking the index to the all-time high after profit margins of such stocks improved,” said Farid Alam, chief executive officer at AKD Securities.

The KSE-100 index surged by 53.64 points, or 0.33 percent, to 16,251.38 points. The closing replaced the previous all-time high of 16,243.27 points recorded on November 8.The index closed just 15 points lower from the intraday high of 16,266.23 points. In the previous two sessions, it had already increased by approximately 77 points.

The KSE-30 index increased by 49.28 points, or 0.37 percent, to 13,233.37 points in the session.Alam said that increased export of Pakistan’s yarn to China improved profit margins of the spinning mills. “The price of cotton remained stable in Pakistan but the price of yarn continued to multiple on the back of significant demand of it from China.”

Similarly, the profit margins of cement also improved after the price of coal declined in the international markets, he said.“The textile and cement stocks are seen continuously driving the market in the next couple of months,” he said, “Based on the assessment of the KSE-30 index, the market my increase afresh 10 percent in the current round of bull-run.”

He said that Pakistan Telecommunication Company Limited (PTCL) also invited renewed buying on the news that parties in the case of International Clearing House for the telecom sector may settle the issue out of court.

Hasnain Asghar Ali, chief operating officer at Escorts Capital, said that the fertiliser stocks also invited renewed buying after they remained subject to profit-selling throughout last week. “Government’s consideration to restore supply of gas to the fertiliser manufacturers helped relevant stocks invited renewed buying.”

Samar Iqbal, an equity dealer at Topline Securities, said that LOTPTA also came in the limelight after Asian PTA producers proposed to link the PTA price with paraxylene to improve their margins.

Stocks that played a leading role in driving the index up included PTCL, Engro Corporation, Dawood Hercules and Oil and Gas Development Company played a leading role in driving the index to a fresh all-time high.

Stocks that well support the drive with significant turnovers included Azgard Nine, Lotte PakPTA, Lucky Cement-XD, Nishat Mills Limited-XD, Bank Alfalah, and Nishat (Chunian)-XDXB.

Maple Leaf Cement was the volume leader with a turnover of 31.27 million shares as it closed at Rs13.02 with an increase of 98 paisas followed by Azgard Nine with a turnover of 26.51 million shares as it closed at Rs8.73 with a gain of 70 paisas.

Shares turnover in the futures market improved to 9.88 million shares from 7.58 million shares traded in the previous session. Of a total of 369 companies’ stocks traded, 245 advanced, 100 declined and 24 remained unchanged.

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US corporate credit risk climbs

New York: A gauge of US corporate credit risk increased, reversing a decline from the lowest level in four days.

The Markit CDX North America Investment Grade Index, a credit-default swaps benchmark that investors use to hedge against losses or to speculate on creditworthiness, increased 0.7 basis point to a mid-price of 98 basis points at 4:15 p.m. in New York on Friday, according to prices compiled by Bloomberg.

The swaps measure rose as JP Morgan Chase & Co. and Wells Fargo & Co. reported shrinking net interest margins, a gauge of the profitability of lending. The index had earlier reached as low as 95.2 basis points after the Thomson Reuters/University of Michigan preliminary October consumer sentiment index increased to 83.1 from 78.3 the previous month, the highest since September 2007.

“Part of it has to do with some uncertainty with respect to earnings: things will pop in one direction and then fade,” Marc Pinto, head of corporate bond strategy at Susquehanna International Group LLP, said in a telephone interview. “Next week we should get a fair amount of data so that we can see more discernible trends.”

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The credit-swaps index typically rises as investor confidence deteriorates and falls as it improves. The contracts pay the buyer face value if a borrower fails to meet its obligations, less the value of the defaulted debt. A basis point equals $1,000 annually on a contract protecting $10 million of debt.

The cost to protect against losses on the debt of Wells Fargo rose 1 basis point to 84.5 basis points at 4:07 p.m., according to data provider CMA, which is owned by McGraw-Hill Cos. and compiles prices quoted by dealers in the privately negotiated market.

Contracts tied to Sprint Nextel Corp. widened, a day after Japan’s Softbank Corp. confirmed it’s in talks to take a stake of as much as 75 per cent of the third-largest US wireless carrier. Sprint’s swaps rose 25.9 basis points to 388.3 basis points at 3:30 p.m. in New York, CMA data show.

Gulfport Energy Corp. sold $250 million of eight-year, dollar-denominated bonds to repay borrowings and prefund drilling expenditures, according to a person familiar with the offering, who asked not to be identified because terms aren’t set. The 7.75 per cent notes were priced to yield 672 basis points more than similar-maturity Treasuries, according to data compiled by Bloomberg.

The average relative yield on investment-grade debt fell 2 basis points, led by communications and energy companies, whose spreads narrowed 2 basis points, according to data compiled by Bloomberg. The relative yield on speculative-grade debt was unchanged, the data show.

Toyota’s bond risk climbs

Toyota China boycott drives bond risk above JGBs

BloombergPublished: 14:03 October 14, 2012Gulf News
Image Credit: REUTERSA worker cleans a Toyota Yaris car at the Wuhan Motor Show, Hubei province, October 12, 2012.

Tokyo: Toyota Motor Corp.’s two-year reign as a better credit than the Japanese government has ended as violent protests over a territorial dispute with China hurt its sales in the world’s biggest car market.

The credit-default swaps for Toyota, the world’s largest automaker, climbed 8.4 basis points to 85.5 basis points on Oct. 10, exceeding the 84 basis points for the sovereign for the first time since August 2010, according to data provider CMA. Those for Honda Motor Co. rose 7.5 to 85.9, while Volkswagen AG increased 1.1 to 105.5, the data show.

Toyota’s September deliveries in China dropped 49 per cent from a year earlier, the biggest drop since at least 2008, after demonstrators protesting Japan’s purchase of islands claimed by both countries torched Japanese auto showrooms and smashed vehicles last month. Continuing tensions are deterring buyers concerned their automobiles will be targeted, according to Kazuo Ohara, executive vice president at Toyota’s luxury brand Lexus.

“Sales halving in September suggests the issue will probably linger longer than expected,” Shintaro Niimura, a credit analyst at Nomura Securities Co., said in a telephone interview from Tokyo on Thursday. “The first impression was that the impact would be limited to just a couple of days. Now, the credit markets are recognising the China risks are really there.”

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The increase in automaker bond risk contrasts with the Markit iTraxx Japan index of credit-default swaps for 50 companies. The gauge declined one basis point to 226.6 on October 10, according to CMA, which is owned by McGraw-Hill Cos. and compiles prices quoted by dealers in the privately negotiated market. An increase signals worsening perceptions of creditworthiness.

Toyota raised 80 billion yen on September 7 in a two-tranche offering including 50 billion yen of five-year 0.317 per cent bonds priced to yield 8 basis points more than similar-maturity government debt, according to data compiled by Bloomberg. The spread rose to 11 basis points on Thursday, JS Price data show.

The spread on the automaker’s $1.5 billion of 0.875 per cent notes due July 2015 relative to Treasuries rose 2 basis points this month to 41.3 as of 10:46 a.m. in Tokyo, according to BNP Paribas SA prices.

Joichi Tachikawa, a Toyota spokesman in Tokyo, declined to comment when contacted by telephone Thursday.

Lexus is refraining from marketing campaigns in the country for the meantime, Lexus’ Ohara said in an interview in Tokyo on Thursday.

“The commotion has passed, but I’m concerned about the impact on consumer attitudes,” Ohara said. “Imagine your brand new car getting damaged. That’s enough to keep some people from buying.”

A Chinese Toyota owner in the country’s northwestern Shaanxi province was struck on the head with steel lock by a demonstrator, leaving him unconscious for day, the official Xinhua News Agency reported. The suspect in the beating, which was captured on video, was arrested, the report said.

Elsewhere in domestic credit markets, Kansai Electric Power Co. hired Daiwa Securities Group Inc., Mizuho Financial Group Inc. and SMBC Nikko Securities Inc. for a 20 billion yen sale of three-year bonds, Mizuho said in a statement on Thursday. The offering will be the third debt sale by the utility since the March 2011 earthquake and tsunami sparked a crisis at a nuclear plant in Fukushima.

Hitachi Capital Corp. raised 20 billion yen split between 0.421 per cent five-year notes and 0.666 per cent seven-year bonds, according to a statement from Nomura Holdings Inc. Kyoto prefecture sold 10 billion yen of 0.8 per cent 10-year debt, the brokerage said in a separate release on Thursday.

Yields on benchmark 10-year government notes changed little at 0.755 per cent as of 10:55 a.m. The securities yielded 91.5 basis points less than similar-maturity Treasuries, compared with 116 basis points a year earlier, data compiled by Bloomberg show.

The yen dropped 0.01 per cent to 78.45 per dollar as of 10:57 a.m., down from a post-World War II record of 75.35 in October. It has strengthened 3.6 per cent in the past six months, the biggest gainer among the 10 developed-nation peers tracked by Bloomberg Correlation-Weighted Indexes.

Japan’s corporate bonds have handed investors a 1.44 per cent gain this year, compared with a 1.89 per cent increase for the nation’s sovereign securities, according to Bank of America Merrill Lynch data. Company notes worldwide have returned 9.5 per cent in the period, the data show.

A total of 1,967 credit-default swaps contracts insuring a net $1.55 billion of Toyota Motor’s debt were outstanding as of October 5, according to the Depository Trust & Clearing Corp. That’s compared with 7,848 contracts for a net $11.5 billion for Japan’s sovereign debt, according to DTCC, which runs a central registry for the swaps market that captures most trading. Higher number of contracts means the swaps are more widely traded.

Wholesale deliveries, including multipurpose and sport utility vehicles, fell 0.3 percent to 1.32 million units last month, the China Association of Automobile Manufacturers said in a statement October 10. That compared with the 1.35 million average estimate of nine analysts surveyed by Bloomberg.

Toyota’s September deliveries tumbled 49 per cent from a year earlier to 44,100 vehicles, Honda’s dropped 41 per cent to 33,931, the lowest since May 2011, while those of Nissan Motor Co.’s fell 35 per cent to 76,066, according to the companies.

Sales of Japanese cars slumped 41 per cent to 160,000 units, cutting their combined market share to 12.2 per cent from 20.5 per cent a year earlier, according to the association. Chinese car brands posted the second-highest monthly sales this year, delivering 561,900 vehicles for a 7.5 per cent gain.

The demonstrations last month escalated after Japan purchased the islands, called Diaoyu in Chinese and Senkaku in Japanese, from a private Japanese owner.

Thousands of protesters marched in Chinese cities on September 18, the 81st anniversary of the Manchurian Incident, an attack on a railway that historians say was used as an excuse by Japan to invade China. Demonstrators in Shanghai gathered at the Japanese consulate chanting “Down with the Japan devils, give back Diaoyu.”

Market watch: Bourse climbs despite profit-taking in major stocks

Benchm­ark KSE-100 index rises 66 points. The ICH made its way back in investors’ speculations, and PTCL registered high volume turnover for the session.

KARACHI: The local bourse witnessed profit-taking at higher levels with focus remaining on the index-heavyweight oil and gas sector, energy sector and fertiliser stocks; however, telecom sector supported the market to close in black.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index rose 0.42% or 65.58 points to end at 15,753.82 point level.

The international clearing house (ICH) made its way back in investors’ speculations, and Pakistan Telecommunication Company (PTCL) registered high volume turnover for the session.

Investors expected higher profitability in PTCL after the implementation of the ICH, said Samar Iqbal, equity dealer at Topline Securities.

The proposed gateway will converge all international calls to a single technical gateway led by PTCL against the current practice of being handled by 14 long distance international operators.

Trade volumes climbed to 133 million shares compared with Tuesday’s tally of 110 million shares.

The earlier reports of successful drilling operation on Mamikhel, smooth operation at Maramzai provided the momentum Pakistan Oilfields to close up 0.9%.

The fertiliser sector was battered in the last 30 minutes on the news that Sui Northern Gas Pipelines (SNGPL) will be unable to provide further gas to Dawood Hercules Fertilizers (DHFL) and other fertiliser producers on its network due to low gas pressure, which resulted in an immediate shut down of the DHFL plant, said JS Global Capital analyst Mujtaba Barakzai.

Engro Corporation also reacted negatively on the same news, closing down 2.3% to Rs102.27 with 2.8mn shares traded. The SNGPL network includes Pakarab Fertilizer, Engro Enven, Agritech Limited and DHFL fertiliser plants. Both Engro and DHFL plants received gas for only 33 days of operations in the first six months of 2012.

The value of shares traded during the day was Rs4.9 billion.

Hub Power Company was the volume leader with 14.5 million shares shedding Rs1.23 to finish at Rs45.47. It was followed by PTCL with 11.2 million shares gaining Rs0.03 to close at Rs19.80 and Karachi Electric Supply Company with 7.7 million shares climbing Rs0.05 to close at Rs5.52.

Foreign institutional investors were net sellers of Rs143.96 million, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, October 11th, 2012.

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Market watch: Bourse climbs on back of index heavyweights

Benchm­ark KSE-100 index rises 26 points.  Shares of 367 companies were traded on Wednesday.The value of shares traded during the day was Rs2.3 billion.

KARACHI: Investor interest in cements, telecom and energy stocks played the role of catalyst in bullish sentiments at the local bourse despite security concerns in the city.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index climbed 0.17% or 25.96 points to end at 15,399.42 point level.

Speculation of early settlement of the National Reconciliation Ordinance case after the Supreme Court granted October 5, 2012 as the deadline for correction of the letter to the Swiss government supported the climb, said Arif Habib Corporation analyst Ahsan Mehanti Trade volumes fell to a paltry level of 83 million shares compared with Tuesday’s tally of 105 million shares.

Shares of 367 companies were traded on Wednesday.The value of shares traded during the day was Rs2.3 billion.

Pakistan Telecommunication Company (PTCL) was the volume leader with 9.4 million shares, gaining Rs0.31 to finish at Rs19.67, attracting buying on the news of the international clearing house (ICH) approval earlier. The proposed ICH gateway will converge all international calls to a single technical gateway led by PTCL against the current practice of being handled by 14 long distance international operators.

It was followed by Maple Leaf Cement with 5.5 million shares gaining Rs0.24 to close at Rs9.02 and DG Khan Cement with 4.3 million shares climbing Rs0.52 to close at Rs48.38.

The cement sector dominated the gains again as four of the top five volume leaders were cement producers over the news, earlier, that cement exports surged by 20.38% to 1.2 million tons worth $91.4 million in the first two months of the fiscal year 2012-13, according to the data released by the Pakistan Bureau of Statistics.

Healthy full year earnings announcements by Maple Leaf Cement kept the script in demand. The company converted losses of Rs1.8 billion last year to a profit of Rs496 million for the fiscal year 2011-12, according to a notice sent to the KSE on Tuesday.

Engro Corporation remained a favourite on the news of allocation of gas fields to fertiliser plants on the Sui Northern Gas Pipelines network before December 2012, according to Mujtaba Barakzai, analyst at JS Global Capital.

Foreign institutional investors were net buyers of Rs388 million showing renewed interest in the market, according to data maintained by the National Clearing Company of Pakistan Limited.

Published in The Express Tribune, September 27th, 2012.

Brent climbs

SINGAPORE: Brent crude rose towards $111 on Friday, extending its gains from a 1-1/2 month low hit in the previous session, as Libya’s precarious security situation and lower North Sea production stoked supply fears.

OPEC member and Africa’s third biggest producer Libya swiftly ramped up oil output after last year’s revolution, but an assault last week on the US consulate heightened fears about the new government’s ability to impose its authority, and this is likely to delay the already-slow return of expatriate oil workers to the country.

“We saw oil prices spike up around 30-32 percent last year when Libya was out of the market,” said Natalie Rampono, a commodity strategist at ANZ.

“This is something to focus on, especially if the security situation deteriorates,” she added.

Brent rose 47 cents to $110.50 a barrel at 0610 GMT, after hitting a high of $110.75 earlier in the session. Brent hit a low of around $107 per barrel on Thursday, its weakest since Aug. 3.

US crude was up 71 cents at $93.13 a barrel. The October contract expired on Thursday at $91.87 a barrel.

Brent futures are down 5.3 percent so far this week, heading for their steepest drop since late June, after key exporter Saudi Arabia pledged to keep prices low, the US mulled release of strategic reserves and the still weak global economy kept demand subdued.

US crude is also down about 6 percent for the week, poised for its biggest weekly drop in about four months.

Adding to the worries about supply disruptions, two more cargoes of North Sea Forties crude loading in October were delayed because of lower production.

Market watch: Bourse climbs led by oil, telecom sectors

Benchm­ark KSE-100 index surges 71 points.  Benchmark KSE-100 index surges 71 points

KARACHI: The stock market continued its upward trend on Tuesday following the announcement of the new petroleum policy and rumours of a major change in the telecom sector operations.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index rose 0.47 per cent or 70.99 points to end at 15,242.65 points level.

Index heavyweight Oil and Gas Development Company and Pakistan Petroleum Limited led the climb following announcement of an increase of 60% in prices for exploration companies for oil and gas extraction in the Petroleum Policy 2012 announced on Monday.

The telecom sector also helped the momentum over International Clearing House (ICH) implementation rumours, according to JS Global Capital Analyst Jawad Khan. The gateway ICH will converge all international calls to a single technical gateway led by Pakistan Telecommunication Company Limited (PTCL) against the current practice of being handled by 14 long distance international operators. PTCL rose to its daily upper circuit limit and was the highest traded share for the second consecutive day.

PTCL was the volume leader with 23.1 million shares gaining Re1 to finish at Rs17.3. It was followed by Telecard Limited with 22.9 million shares gaining 0.43 to close at Rs 2.67 and Fauji Cement with 19.7 million shares losing Rs0.17 to close at Rs6.9.

“Investor interest was also witnessed in oil and banking sectors on strong earnings outlook amid hopes for signing of Bilateral Investment Treaty with the US,” said Arif Habib Corporation analyst Ahsan Mehanti. Trade volumes jumped to 304.5 million shares compared with Monday’s tally of 260 million shares.

Foreign institutional investors were buyers of Rs258.9 million and sellers of Rs467.6 million worth of shares, according to data maintained by the National Clearing Company of Pakistan Limited.

Shares of 325 companies were traded on Tuesday. At the end of the day 165 stocks closed higher, 136 declined while 24 remained unchanged. The value of shares traded during the day was Rs 7.2 billion.

Published in The Express Tribune, August 29th, 2012.

Market watch: Bourse climbs on Supreme Court verdict

Benchm­ark KSE-100 index surges 132 points.  Benchmark KSE-100 index surges 132 points.

KARACHI: Investors welcomed the Supreme Court decision on Monday and continued lifting the bourse above the 15,000-point level.

The Karachi Stock Exchange’s (KSE) benchmark 100-share index surged 0.88 per cent or 132.48 points to end at 15,171.66 point level.

“Market welcomed Supreme Court’s verdict as it indicated that the judiciary and the government are trying to find a middle ground in the dispute,” said Topline Securities Equity Dealer Samar Iqbal. The apex court granted Prime Minister Raja Pervez Ashraf’s time on Monday and adjourned the hearing till September 18 in the National Reconciliation Ordinance implementation case.

Augmenting the positive sentiment was the announcement of the new petroleum policy 2012 which bodes well for index heavyweight oil and gas sector, added Iqbal.

Trade volumes fell 260 million shares compared with Friday’s tally of 306 million shares.

Engro Corporation further continued its upward move as it seems likely now that the fertiliser giant will be given gas from other sources other than the Sui gas network. The new plant of Engro Fertilizers operated for only 33 days due to gas shortage on the Sui network in the first six months of 2012.

Foreign institutional investors were buyers of Rs228 million and sellers of Rs380 million worth of shares, according to data maintained by the National Clearing Company of Pakistan Limited.

Rumours regarding International Clearing House (ICH) also resurfaced which created positive buying momentum in PTCL, which was the highest traded share and close at its daily upper limit. The gateway ICH will converge all international calls to a single technical gateway led by PTCL against the current practice of being handled by 14 Long Distance International operators

Pakistan Telecommunication Company Limited was the volume leader with 33.5 million shares gaining Re1 to finish at Rs16.3. It was followed by Lafarge Pakistan with 20.3 million shares firming Rs0.3 to close at Rs6.0 and Fauji Cement with 17.8 million shares increasing Rs0.3 to close at Rs7.1.

Shares of 350 companies were traded on the first trading session of the week. The value of shares traded during the day was Rs6.0 billion.

Published in The Express Tribune, August 28th, 2012.