BUSINESS IN BRIEF | August 7, 2012
Asian stock markets rise after weak gains
BANGKOK (AP) — Asian stock markets rose sharply Monday, boosted by stronger-than-expected U.S. hiring for July following three months of weak job gains.
Investors scooped up shares on news that the pace of hiring in the world’s biggest economy was improving and after a softening of Italy’s and Spain’s sovereign bond yields — a sign of less worry about those economies. That helped dispel fears that the 17-nation euro currency union could face a breakup as it wrestles with a massive debt crisis.
“I think people are no longer worried that the eurozone will collapse, so confidence has returned to the market,” said Francis Lun, managing director of Lyncean Holdings in Hong Kong.
A weekend statement by the People’s Bank of China indicating it would intensify policy fine-tuning also helped investment sentiment by raising hopes for more monetary easing, analysts said.
Airline owner considers stake in American
LONDON (AP) — The owner of British Airways and Spanish airline Iberia is considering taking a stake in American Airlines.
The Financial Times on Monday quoted Willie Walsh, the chief executive of International Airline Group, as saying that a small stake in American could reinforce American’s participation in the Oneworld alliance which includes British Airways, Iberia, Japan Airlines and Qantas. British Airways has a joint venture with American on North Atlantic flights.
Walsh said IAG is prepared to buy a stake “if we can make the case that there is additional strategic value to be achieved.”
Standard & Poor’s affirms bank ratings
MILAN, Italy (AP) — Standard & Poor’s on Monday affirmed the ratings 15 of Italy’s biggest banks, and has cut the ratings on 15 more lenders.
The U.S. credit ratings agency warned that Italy’s recession will be potentially deeper and more prolonged than previously thought. It added that while problem assets were mounting, many banks had reduced provisions for loan losses, making them more vulnerable.
Investors are concerned that recession-hit Italy will find it more and more difficult to handle its debt burden — about 123 per cent of its C1.58 trillion ($1.93 trillion) gross domestic product — and have been demanding higher interest rates on its bonds.
The ratings of UniCredit SpA and Intesa Sanpaolo SpA were confirmed by S&P. They were among 34 banks that had their S&P ratings downgraded in February due to the country’s financial vulnerability and expectations of lower earnings.
Banca Carige SpA, Banca Popolare dell’Alto Adige and Unione di Banche Italiane, among others, also saw their ratings reduced further.
Kurdish rebels attack pipeline, TV reports
ANKARA, Turkey (AP) — Turkey’s state-run television says Kurdish rebels have attacked a pipeline carrying oil from Iraq to world markets, cutting oil flows for a second time in two weeks.
TRT television says the rebels blew up a section of the pipeline running from Kirkuk, in northern Iraq to a Turkish Mediterranean port, late Sunday. The attack occurred in the southeastern province of Mardin.
Officials at Turkey’s Energy Ministry and at the state pipeline company could not immediately be reached.
It was the second attack on the pipeline in just over two weeks. On July 21, an explosion and fire blamed on rebels also shut down oil flows for days.
Two pipelines from Kirkuk to the Turkish Mediterranean port at Ceyhan carry about 25 million tons of crude oil a year.