* US to reveal Afghan pull out plan
* Indian investors avoid ‘political’ stocks
* PetroChina shale gas talks collapse
* World Bank in push for food price hedging
* MSCI delays decision on upgrading UAE, Qatar to Emerging-Market status
* Asia’s private bank scene grows more fraught
* Over 120 Indian companies sets up Singapore office a month
* ‘Collectors’ spur Beijing to step up production of gold Panda coins
* Chile hydroelectric power plant on hold
* Markets, mixed
US to reveal Afghan pull out plan
President Barack Obama will on Wednesday announce his plan for pulling US troops out of Afghanistan, a decision that will set the foreign policy tone for the rest of his first term, the FT reports. Mr Obama will make the announcement in a prime-time address before heading to Fort Drum army base in upstate New York on Thursday to visit troops who have been deployed to Iraq and Afghanistan. The White House has been tight-lipped about Mr Obama’s deliberations, with the president coming under pressure from the military to unveil only a modest drawdown of the 100,000 US troops in Afghanistan.
Indian investors avoid ‘political’ stocks
Investors in India’s stock markets are starting to avoid companies with strong political connections after corruption scandals, the FT reports. Indian stocks with strong political links – defined as those with direct political involvement or ones that are dependent upon a government licence – have underperformed the broader Indian market by 14 per cent over the past year, according to research from Ambit Capital, a Mumbai-based brokerage. The sharp fall in investor sentiment among as many as 75 politically influential companies on the Bombay Stock Exchange follows scandals involving a possible $39bn public loss from an auction of 2G mobile telecom licences and the mismanagement of Commonwealth Games contracts.
PetroChina shale gas talks collapse
PetroChina and Calgary-based Encana have abandoned plans for a joint venture to develop a large shale gas deposit in western Canada, marking the latest in a series of retreats by Chinese companies from proposed natural resource deals overseas, the FT reports. PetroChina’s investment, set at $5.4bn when the deal was unveiled in February, would have been China’s biggest investment in Canada’s energy sector. It would also have been its largest in shale gas, a type of natural gas deposit that is difficult to extract and for which Chinese companies want to master the technology.
World Bank in push for food price hedging
The World Bank is taking the rare step of encouraging companies in developing countries to buy insurance in the derivatives markets against sudden changes in food prices with a deal that should allow them to hedge $4bn worth of commodities, the FT reports. The deal, struck with investment bank JPMorgan, comes as countries such as China and India weather a second surge in agricultural commodities prices following the 2007-08 food crisis.
MSCI delays decision on upgrading UAE, Qatar to Emerging-Market status
MSCI, whose stock indexes are tracked by investors with about $3,000bn in assets, delayed until December its decision on whether to raise the United Arab Emirates and Qatar to emerging-market status, Bloomberg reports. South Korea and Taiwan failed to win the developed-market designation from MSCI, which currently considers them emerging markets, according to a statement yesterday. The two countries, Asia’s biggest developing stock markets after China and India, will be evaluated again for a shift in 2012.
Asia’s private bank scene grows more fraught
Emerging Asia’s wealthy are getting richer twice as fast as their peers in other regions, the FT reports. For private banks, which generally seek clients with at least $1m in investable assets, that sounds like a licence to print money. Instead, the industry is struggling with rising costs, sputtering revenues and narrowed margins, raising questions about whether some of the banks flooding into the market will eventually have to drop out.
Over 120 Indian companies sets up Singapore office a month
As many as 120 India-based companies are incorporating offices in Singapore every month, taking advantage of the city state as a gateway to Asia-Pacific markets, the Economic Times reports. Speaking at the launch of the annual corporate awards campaign for Indian businesses in Singapore, R Narayanamohan, the chairman of the Singapore Indian Chamber of Commerce and Industry (SICCI) said the community of Indian businesses has grown to 5,000 in Singapore as of this month, up from 4,000 a year ago. Indian companies make up the single largest business community from any single country in Singapore.
‘Collectors’ spur Beijing to step up production of gold Panda coins
China’s central bank will produce more than double the quantity of gold Panda coins this year than it had planned, in response to a surge in buying from Chinese investors, the FT reports. The increase in production is “to meet the needs of collectors”, the central bank said in a statement posted on its website. Rising inflation in China and other Asian countries has inspired a surge in gold investment this year, according to bullion dealers, as investors turn to hard assets such as precious metals as a means of wealth preservation.
Chile hydroelectric power plant on hold
A fiercely contested project to dam two pristine rivers in southern Chile and build five hydroelectric power plants in the glacier-carved Patagonian wilderness has been temporarily put on hold by an appeals court ruling, the FT reports. The appeals court in the southern city of Puerto Montt this week granted three injunctions brought by environmentalists against the May 9 approval of an environmental impact plan for the HidroAysén power project, which is owned by the companies Endesa and Colbún.
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