Federal regulators said on Tuesday that they would place stricter limits on foreign exchanges that trade American oil as concerns continue to grow about the role of speculation in rising fuel prices. Some lawmakers said the move was long overdue.
At a Senate hearing to assess its performance, the Commodity Futures Trading Commission said it would require the London-based ICE Futures Europe exchange to adopt position limits used in the United States for the trading of the West Texas Intermediate crude oil contract, which is linked to a similar contract on the New York Mercantile Exchange.
Under the new agreement, foreign officials also will share daily trading data with American authorities and report any violations. Previously they shared data on a weekly basis.
IntercontinentalExchange Inc. in Atlanta, the parent company of ICE Futures Europe, plans to comply with the new rules and said the commission’s action would have almost no impact on its customers or business.
The commission’s acting chairman, Walter L. Lukken, had previously told Congress that oil prices appeared to reflect market fundamentals. He pointed to the declining value of the dollar and rising demand in developing nations as major factors behind the multiyear ascent in oil prices.
But in the last month the agency has taken a flurry of actions to gather more data on unregulated trading, including over-the-counter swaps.
Considering the commission’s limited view of the futures market, Senator Byron L. Dorgan, a North Dakota Democrat, questioned whether regulators knew enough about the markets to gauge the effects of speculation.
“If you don’t have the foggiest idea what percentage of total contracts you are regulating, you wouldn’t have a clue whether there is excessive speculation in the markets,” Mr. Dorgan said.
Wednesday, June 18, 2008
Growth down to 3.6% for six core industries in April 08
Pulled down by the sluggish performance of petroleum and electricity sector, growth of India’s six core industries slowed down to 3.6% in the first month of the current fiscal as against 5.9% a year ago.
The six core infrastructure industries - crude oil, petroleum refinery products, coal, electricity, cement and finished carbon steel - had registered a 9.6% growth in the preceding month of March.
Of the six industries, that have a combined weight of 26.7% in the overall Index of Industrial Production (IIP), refinery products growth slowed down considerably to 4.3% in April from 15.% in the same month last year.
Similarly, electricity generation growth was down to 1.4% from a robust 8.7% in April 2007.
Crude oil growth came down to 0.9% from 1.4%.
The remaining three sectors--coal, cement and finished carbon steel--registered good growth rates. Coal output grew by 10.3% from a mere 0.6%, while cement production rose by 6.9% from 5.8% and finished carbon steel to 4% from 2.7%.
Industrial growth, contributed to the extent of more than one-fourth by these six industries, had recovered to 7.1% in April from a mere 3.9% in the preceding month. However, the growth was quite down from 11.3% in April 2007.
For the April-March period of 2007-08, growth of six infrastructure industries was down to 5.6% as compared to 9.2% in the corresponding period a year ago.
The six core infrastructure industries - crude oil, petroleum refinery products, coal, electricity, cement and finished carbon steel - had registered a 9.6% growth in the preceding month of March.
Of the six industries, that have a combined weight of 26.7% in the overall Index of Industrial Production (IIP), refinery products growth slowed down considerably to 4.3% in April from 15.% in the same month last year.
Similarly, electricity generation growth was down to 1.4% from a robust 8.7% in April 2007.
Crude oil growth came down to 0.9% from 1.4%.
The remaining three sectors--coal, cement and finished carbon steel--registered good growth rates. Coal output grew by 10.3% from a mere 0.6%, while cement production rose by 6.9% from 5.8% and finished carbon steel to 4% from 2.7%.
Industrial growth, contributed to the extent of more than one-fourth by these six industries, had recovered to 7.1% in April from a mere 3.9% in the preceding month. However, the growth was quite down from 11.3% in April 2007.
For the April-March period of 2007-08, growth of six infrastructure industries was down to 5.6% as compared to 9.2% in the corresponding period a year ago.
MARKET PREDICTION
GLOBAL MARKETS ARE MIXED.
NIFTY COULD OPEN FLAT TOTAL OI IS 85K CR AND JUNE SERISE OI IS 75K CR AND JULY SERISE O I IS 10 K CR,PUT CAL RATIO EASING A BIT TO 1.54 DUE TO FEW ADDITION IN CALL OPTION.
LEVEL OF NIFTY IS 4580-4630-4670-4700.
HEAVY SHORT COVERING FOUND IN BANKING AND FINANCIAL SERVICE AND CONSTRUCTION SECTOR ..
TODAY WE CAN ASSUME SAME SHORT COVERING IN THE SECTOR.
HAVE A NICE TRADING DAY
-MR SAM
NIFTY COULD OPEN FLAT TOTAL OI IS 85K CR AND JUNE SERISE OI IS 75K CR AND JULY SERISE O I IS 10 K CR,PUT CAL RATIO EASING A BIT TO 1.54 DUE TO FEW ADDITION IN CALL OPTION.
LEVEL OF NIFTY IS 4580-4630-4670-4700.
HEAVY SHORT COVERING FOUND IN BANKING AND FINANCIAL SERVICE AND CONSTRUCTION SECTOR ..
TODAY WE CAN ASSUME SAME SHORT COVERING IN THE SECTOR.
HAVE A NICE TRADING DAY
-MR SAM
Investors pour funds into Asian real estate
The flow of capital into Asian property from outside the region is accelerating as a result of the credit crisis in the US, according to a report on the sector published on Wednesday.
Property investment in Asia grew 27 per cent to $121bn in 2007 and continues to build, says the report, which is being published by KPMG, the Asia Pacific Real Estate Association and index provider FTSE.
Investment was evenly allocated over the first and second halves of the year, unlike in Europe and North America, where investment slowed dramatically in the second half.
Most Asian markets recorded direct real estate returns above the global average of 10 per cent last year. This is forecast to continue, albeit at a lower rate.
The report comes during a period of aggressive fundraising activity for new global property funds, many of which are raising allocations to Asia to gain exposure to economies that are relatively insulated from the credit crisis. Property markets in the region, while not immune, have stood up relatively well compared with the US and Europe.
MGPA, the private equity fund manager part owned by Australia’s Macquarie Bank, this week launched a global fund that will invest mostly in Asia. It has secured $3.9bn in equity for Asian investment, giving it a potential buying power in the region, with leverage, of $15.6bn.
The fund has already committed $2.2bn to investments in Singapore, Japan, China and Thailand, and is looking at South Korea, Malaysia, Taiwan and Australia. North American investors make up 40 per cent of the fund.
Asian real estate investment trusts also outperformed American and European counterparts. Credit problems and softening real estate prices in the US and Europe mean that investors are focusing more on Asia both for long-term returns and opportunistic investments, according to the report.
At the same time, banks have become more reluctant to lend for new Asian projects, which increases the bargaining power of foreign funds. But the report says this has slowed, rather than halted, the financing process.
“There’s no shortage of capital in Asia,” said Andrew Weir, one of the report’s authors. “There are investment funds that have raised money and haven’t spent it yet.”
Property investment in Asia grew 27 per cent to $121bn in 2007 and continues to build, says the report, which is being published by KPMG, the Asia Pacific Real Estate Association and index provider FTSE.
Investment was evenly allocated over the first and second halves of the year, unlike in Europe and North America, where investment slowed dramatically in the second half.
Most Asian markets recorded direct real estate returns above the global average of 10 per cent last year. This is forecast to continue, albeit at a lower rate.
The report comes during a period of aggressive fundraising activity for new global property funds, many of which are raising allocations to Asia to gain exposure to economies that are relatively insulated from the credit crisis. Property markets in the region, while not immune, have stood up relatively well compared with the US and Europe.
MGPA, the private equity fund manager part owned by Australia’s Macquarie Bank, this week launched a global fund that will invest mostly in Asia. It has secured $3.9bn in equity for Asian investment, giving it a potential buying power in the region, with leverage, of $15.6bn.
The fund has already committed $2.2bn to investments in Singapore, Japan, China and Thailand, and is looking at South Korea, Malaysia, Taiwan and Australia. North American investors make up 40 per cent of the fund.
Asian real estate investment trusts also outperformed American and European counterparts. Credit problems and softening real estate prices in the US and Europe mean that investors are focusing more on Asia both for long-term returns and opportunistic investments, according to the report.
At the same time, banks have become more reluctant to lend for new Asian projects, which increases the bargaining power of foreign funds. But the report says this has slowed, rather than halted, the financing process.
“There’s no shortage of capital in Asia,” said Andrew Weir, one of the report’s authors. “There are investment funds that have raised money and haven’t spent it yet.”
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