JD.COM Infographic (SEC PROSPECTUS)

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Despite running at a loss, JD valuation jumps to $15.7 billion ahead of US listing

JD.com (a.k.a. Jingdong) updated its SEC prospectus today, showing the company’s equity valuation nearly doubled since December to US$15.7 billion. That huge jump comes despite JD falling short of profit last year, reporting a narrow US$8.1 million operating loss in 2013. The update also shows a new ownership structure, with founder Richard Liu increasing his stake to 18.8 percent, making him the second-largest shareholder after Tiger Global Management. Once Tencent takes its stake, it will become the third-largest stakeholder. JD’s prospectus includes some out-of-the-ordinary anti-takeover measures in favor of Liu. The Financial Times notes that the board may not vote unless Liu is present, which means he could block a vote by calling in sick. Also, if for any reason Liu is sent to prison or otherwise forcibly confined, he’ll remain in control of the company.

These stipulations resemble Jack Ma’s attempts to keep a tight hold on Alibaba when courting the Hong Kong stock exchange for an IPO. His efforts eventually foundered, and Alibaba decided to file in the US where the rules on ownership structures are more lenient. JD will be the biggest Chinese tech IPO to list in the US, at least until Alibaba completes its paperwork. To avoid a conflict of interest, the two companies have prohibited any one bank from sponsoring both of them. JD hopes to raise US$1.5 billion from its public listing.

Source: TECHINASIA

World’s most popular mobile browser from China soars past the half billion user mark as it picks up steam overseas

 Source: TECHINASIA

  UC Browser,the world’s most popular third-party mobile browser made by China’s UCWeb, announced today it passed the 500 million global quarterly active user mark. UCWeb reported hitting the 400 million user threshold in May of last year, which means the browser gained an additional 100 million in less than 12 months. 300 million of its users are on Android. To put that into perspective, China’s top messaging app and social network WeChat recently reported 355 million monthly active users. UC Browser’s figure is somewhat inflated because it is using quarterly stats as opposed to monthly, but it’s an impressive figure nonetheless.
China is home to UCWeb’s largest userbase, holding 65 percent of the mobile browser market share, according to iResearch. Smartphone users in China spend twice as much time on mobile browsers as they did a year ago. In August, UC Browser overtook Opera as India’s top mobile browser, and now accounts for 32 percent market share according to StatCounter. UC Browser is available for free on Android, iOS, Symbian, Java, Windows Phone, Windows Mobile, and Blackberry. UC Browser was also released for Android-based Smart TVs earlier this month.

Tencent boosts ecommerce business yet again with $180 million stake in property portal

Source: TECHINASIA
Chinese web giant Tencent has paid US$180 million to take a 15 percent stake in a major real estate portal and ecommerce site in the country, the company said this evening. Tencent’s stake is in Leju, which is a subsidiary of E-House (NYSE:EJ). Leju is in the process of being spun off from E-House for its own US IPO, at an unscheduled point this year. Leju’s F1 filing with the US SEC is here. This new deal comes just eleven days after Tencent radically shook up its struggling ecommerce business by taking a 15 percent stake in Amazon-style estore JD. As part of that agreement, JD will run part of Tencent’s online shopping business.

Leju (pictured below) has real estate listings, a property search engine, and an ads platform to make money from property-related ads. Tencent already has its own ads-stuffed property portal at house.qq.com. The killer part of the deal for Leju is that – according to Tencent president Martin Lau – the partnership “will bring Leju’s rich real estate information to WeChat users” in China. Perhaps Chinese users of WeChat will soon be able to buy a house within the messaging app. That’s not too far fetched since they can already use it to buy stuff or book a taxi.

ICIS: Tight supply for Nigeria LNG cargoes over 2015-2016 period

"A five-year supply tender for up to 30
Nigeria LNG cargoes from October 2015
closed on 5 March attracting a wide range
of bids that can be used as a yardstick for
the global LNG forward curve.
The value of cargoes on offer from Lisbon-based
Nigerian offtaker, Galp Energia, were widely deemed to
be backwardated over the period. Most traders attached
a premium over the 2015-2016 period in accordance
with expected liquefaction delays in Australia, while the
consequent onset of export ramp-ups both in Australia
and the USA from 2017-2020 saw lower-valued cargoes
at the back end of the period.
Traders were required to submit a single bid for either
the entire 30 cargoes over the 2015-2020 period or for
specified sub-sections of the lifting period. The pricing
behind all bids had to be made at a 10.5% index to Brent
crude oil plus a constant. The constant is understood to
be Galp’s margin on its NLNG agreement.
While Galp will be keenly aware of a recent tender award
for 2014-2015 Nigeria cargoes settling at 14-14.5% Brent,
one trader said it may turn down a comparable bid for its
near-term string, preferring instead to go for a lower-value
bid that stretches over the entire period or just the back
end towards 2020.
On the sell side, Galp - which expects to receive equity LNG
from Mozambique by the end of the decade, may do well to
lock in forward value in today's relatively under-supplied
global market".
"As it becomes very difficult to assess the market
beyond 2016, the trader explained he could only put in a
conservative bid to cover cargoes from 2017-2020".

Source: ICIS

What does U.S. know about Putin's oil wealth?

The most startling part of Washington's sanctions on Russian businessmen loyal to President Vladimir Putin may be a single sentence that contains an explosive allegation: that Putin himself profits from the world's No. 4 oil trading company, Gunvor.

Among the people the United States sanctioned on Thursday as part of its drive to put pressure on Russia for its intervention in Ukraine was businessman Gennady Timchenko, a long-time acquaintance of Putin and, until this week, co-owner of Geneva-based Gunvor, which trades nearly 3 percent of the world's oil.

In announcing the sanctions, the Treasury Department went a step further, adding a single sentence that hits squarely at one of the most controversial topics that Putin has faced in 13 years as the Kremlin ruler and head of the government.

"Timchenko activities in the energy sector have been directly linked to Putin. Putin has investments in Gunvor and may have access to Gunvor funds," the statement said. 

Source: Reuters

European Union prepares for trade war with Russia over Crimea

Europe began to prepare for a possible trade war with Russia over Ukraine on Friday, with the EU executive in Brussels ordered to draft plans for much more substantive sanctions against Moscow if Vladimir Putin presses ahead with Russian territorial expansion.

But the bigger EU countries – Germany, France and Britain, all with major but very different interests at stake in Russia – split over the tactics of a new campaign with fears that a trade war would be highly risky and potentially ruinous.

A two-day summit of EU leaders dominated by the Crimea crisis ended with 12 Russian politicians and military figures being added to a list of 21 so far subjected to travel bans and asset freezes.

Unlike Washington, which on Thursday blacklisted senior Kremlin figures and oligarchs, the EU list avoided Putin's immediate entourage, instead targeting figures such as Sergei Glazyev, an economic adviser to Putin, Dmitry Rogozin, a deputy prime minister, and the heads of both houses of parliament. "The persons are not so important," said a senior EU official. "It's the climate we're creating." He denied any differences with the Americans. "It's not a beauty contest."

The summit debate, participants and witnesses said, focused on what is known as "stage 3" of a sanctions regime, meaning broader trade and economic sanctions against Russia if the Kremlin escalates operations to seize more territory in Ukraine beyond the Black Sea peninsula of Crimea, whose annexation was formally concluded on Friday in Moscow.

David Cameron reserved strong language for the Kremlin move. "A sham and illegal referendum has taken place at the barrel of a Kalashnikov," he said. "Russia has sought to annex Crimea, a flagrant breach of international law and something we will never recognise."

Moscow criticised the Foreign Office for its choice of rhetoric on the Ukraine crisis. "We are being reassured that the British government wants to maintain normal diplomatic relations with the Russian Federation. If that is the wish of our British partners, then this relationship has got to be normal and diplomatic including at the level of rhetoric. Good relations ought to be valued. The British side should mind its language. Unfortunately, that's not the case with the British Embassy in Moscow," said the Russian foreign ministry. "It seems that the harsh rhetoric, quite beyond the pale, is meant to cover up the gross inaptitude of the Brussels bureaucracy and its zero-sum motive to engineer a cold war-type geopolitical grab on Russia's borders."

Cameron pointed out that while the EU depended on Russia for a quarter of its gas supplies, the Russian gas monopoly Gazprom relied on Europe for half of its exports. "Russia needs Europe more than Europe needs Russia," he said.

The European commission in Brussels was told to draw up plans for sanctions "in a broad range of economic areas".

Such language masked differences between Britain and France on the one hand and Germany on the other. Following the summit, Germany's chancellor, Angela Merkel, failed to mention the next phase of much more serious penalties, while Cameron emphasised them.

On Thursday, the White House named metallurgy, energy, trade and other areas as possible targets for action. London and Paris wanted to echo this. "The Russians have to see where they will hurt," said one diplomat. Germany, by far Russia's biggest trade partner in the EU and the biggest buyer of Russian gas, has resisted attempts to specify what the sanctions targets might be.

Apart from its energy dependency, the Germans say they have more than 6,000 firms operating in Russia and that 300,000 jobs in Germany depend on trade with Russia.

Cameron was much more explicit on the issue and British officials admitted there were divisions. He mentioned "finance, military, energy" as areas being considered. "There's nothing left out."

That suggested equal pain for the three big countries since Britain has most to lose from financial sanctions, France has billion of euros at stake in defence contracts with Russia, while Germany suffers most from sanctions in the energy sector.

It is not clear when the European commission will deliver its battle plan for expanded sanctions but there is an acute feeling among commission officials that Brussels has been handed a poison chalice. They said as soon as the plans are published or leaked, the Russians will know what to expect or fear and will get their retaliation in pre-emptively, triggering a much bigger crisis between Europe and Russia.

The senior EU official, though, said it would be "really stupid" for the EU to reveal its hand. "The commission is keeping its cards close to its chest. We will not do this in full transparency. It will not be transparent at all."

While the Americans have been much more open in spelling out their plans, the Europeans complain that it is easier for Washington because it has much less to lose, with US-Russian trade volumes barely one-twelfth of that between the EU and Russia.

The senior official said the blacklist was not coordinated with Washington. "We are following our own course. The US is far away."

The EU and the interim Ukrainian government have now signed part of a political and trade pact, the issue that led to the crisis last November that ultimately triggered a revolution in Kiev and Russian intervention in Crimea.

The EU summit agreed to race ahead with similar pacts with Moldova and Georgia, concluding them by June.

Source: theguardian

China says plans to speed up investment, stabilise demand

Premier Li Keqiang said China will speed up investment and construction plans to ensure domestic demand expands at a stable rate - an indication authorities are considering practical measures to support slackening economic growth.

Li said at a weekly cabinet meeting that China needs to roll out approved plans for growing domestic demand to keep growth in the economy in a "reasonable range".

No further details were given in an official statement following the meeting, and it was not clear if Li had given authorities a green light to accelerate new investment, or to start work on projects that have already been approved.

But his remarks, which came after China quietly revealed last week that it had signed off on 142 billion yuan ($23 billion) worth of railway projects this year, stoked talk among analysts that Beijing is ready to stimulate the economy.

China rattled financial markets earlier this month with data showing growth in investment, retail sales and factory output plumbing multi-year lows in January and February.

Investors, multinational companies and its major trading partners fear a sharper-than-expected slowdown in China will soon drag on activity across the world.

Ramping up state investment to shore up the economy has been par for the course in China in recent years.

In 2008/09, in the face of the global financial crisis, Beijing approved a whopping 4 trillion yuan ($645 billion) of state spending funded partly by bank loans.

That spending helped China recover quickly from the crisis, but the mountain of debt incurred fed other credit problems that the government now hopes to fix, in part by abandoning its former export- and investment-driven growth model.

Stimulus measures announced in several economic soft patches since then have been more modest and more focused, such as last year's spending on social housing, infrastructure and energy-saving industries, and tax breaks for smaller firms.

The five railway projects tipped last week were approved in January and February and will get half of their funding from bank loans, according to the country's economic planner, the National Development and Reform Commission.

Some analysts cautioned investors against taking the latest projects as an indication that China is ramping up spending again, as the construction sector usually picks up in March as the weather turns warm.

They said if China does increase investment in coming months, it would be a setback for broader economic reforms, but arguably an unavoidable one as Beijing is intent on growing the economy by around 7.5 percent this year to boost incomes and employment.

"Of course it will compromise reforms, but the starting point is that the government has to seek a compromise between growth and reforms," said Tao Wang, an economist at UBS. "It was always meant to be a balance."

At a plenum meeting of the Communist Party last November, China announced ambitious reforms that signalled the shift of the world's second-biggest economy from investment- and export-fuelled growth towards a slower, more balanced and sustained expansion.

Some changes, such as government downsizing or closures of debt-laden factories, are likely to take a back seat to avoid fuelling job losses and undermining social stability, analysts have said.

China has been showing some determination to reform and few experts believe Beijing will launch another super-sized stimulus to prop up the economy.

On Thursday, the government relaxed rules to allow more foreigners to invest in its stock markets, the latest step to free its financial markets after widening the yuan's trading band at the weekend, taking it closer to turning the yuan into a convertible, global currency.

China also has lifted a ban on equity financing for listed property developers for the first time in four years, a step that could herald less government intervention in the sector and ease funding concerns as credit grows tight and the economy slows.

The approvals come amid growing fears of defaults in the property sector after the collapse of Zhejiang Xingrun Real Estate.

Some analysts believe China's central bank is engineering the recent slide in the yuan to cushion the weakening economy by making exports more competitive, and others speculate that the government may step up efforts to bolster growth in coming months.

Analysts from government-controlled think-tanks told Reuters last week that Beijing may loosen monetary policy by reducing the level of deposits commercial banks must keep at the central bank if the economic growth slips below its 7.5 percent target.

Beijing could re-energise the economy by increasing government spending, which may involve familiar themes of greater investment in railway construction, public housing and environmental projects such as water conservation.

Source:  Reuters

Russia good place to start for Dominique Strauss-Kahn's macro fund

 Finance is more forgiving than politics. Dominique Strauss-Kahn is trying to raise $2 billion to launch a macro hedge fund. The first stop on the roadshow is China. But given current events, the former French finance minister and International Monetary Fund managing director may find that his best bet is to convince his many Russian friends that he can make them money.

When DSK, as Strauss-Kahn is widely known, was arrested for sexual assault in New York in May 2011, Vladimir Putin, then Russia's prime minister, went public with his scepticism and hinted at a dark conspiracy. After Strauss-Kahn quit his IMF job and, months later, prosecutors dropped the charges, he embarked on a low-profile career as an international consultant. He soon found work in Russia.

He now sits on the board of the bank owned by Rosneft , Russia's largest oil company, whose chief executive, Igor Sechin, narrowly avoided appearing on the list of individuals hit by Western sanctions, according to news reports. Strauss-Kahn is also a director of the Kremlin-sponsored fund designed to attract foreign investment to Russia, a task that will be arduous in the months ahead.

Moscow, though, is not the only place where a chequered past as a politician is no impediment to a lucrative present in business. Nicolas Sarkozy, whom Strauss-Kahn might have challenged in the last French presidential election had his career not taken its bizarre twist, recently explored launching a private equity fund with Qatari money. Big fund management firms routinely stuff their international advisory boards with retired or outcast politicians. The idea is to turn connections into profit.

DSK will try to make successful investments, not just collect generous consulting fees like some of his former peers. That could be a tough sell, even to his Russian circle. Macro funds have disappointed hedge fund investors lately, losing money on average in all of the last three years, according to Hedge Fund Research. Successful or not, his foray into the world of two-and 20 fees will add to general voter cynicism, as public service looks more and more like just a stepping stone towards the world of real money.

Source: Reuters

Marc Faber Thoughts in Bloomberg Surveillance with Tom Keene

There are indications of a tightening of international liquidity.

Corporate profits in U.S. Companies will continue to contract.

Money has not flowed evenly to all asset classes.

And talking in terms of sectors it has flowed into financials,services and well to do people.

We are in a risk of a Systemic Crisis, and we all are going to loose no matter which asset
class we hold.

Experts: European Union divesification from Russian Gas supply post 2020, and difficult to achieve.

Russia's seizure of the Crimea and its threat to cut off gas to Ukraine, a transit route to the rest of Europe, have revived calls to reduce the EU's reliance on Moscow for energy, but the blocs options are limited and costly. [

The European Union made some progress in improving its energy security after rows over unpaid gas bills between Kiev and Moscow led to the disruption of supplies to western Europe in 2006 and 2009.

By improving its pipeline network, the EU is better prepared for a new supply disruption, but it has not managed to reduce Russia's share of European energy supplies. 

Russia today is Europe's biggest supplier of oil, coal and natural gas, meeting around a third of demand for all those fuels, according to Eurostat data, and receiving in return a thumping $250 billion a year.

European leaders said on Friday that the stand-off with Moscow over Crimea made them more determined than ever to end decades of dependence on Russian gas, but they will have to work hard to convince the sceptics.

"The curious feature of the energy policy that emerged from the middle of the last decade is just how little serious effort has been put into security - in particular Eastern security," said Dieter Helm of Oxford University in a research paper this week.

While buyers can switch oil and coal suppliers relatively quickly and easily, Europe receives most of its gas through pipelines that are fed by only one supplier, chief among them Russia's state-controlled Gazprom .

"Gazprom's market share in Europe is increasing (due to decline of European production). So the aim of diversification of our supply is not going to be achieved this side of 2020," said Thierry Bros, gas analyst at French Bank Societe Generale.

"The question of diversification of supply post 2020, what is now in discussion in Brussels, is going to be very difficult to achieve, as with (gas) prices just below $10 per million British thermal units (mmBtu), Russia is making alternative developments for Europe less profitable," he added.

Source: Reuters

INO.COM: Five year Bull-Market Getting Tired

Lufthansa's strategy to get more profitable

Why did Alibaba invest $215 million in Tango when no one in China uses Tango?

In yet another boon to the mobile messaging race, Chinese ecommerce giant Alibaba has led a $280 million investment round in the Mountain View-based mobile messaging company Tango, as first reported by Forbes. Representatives from the Hangzhou-based company have confirmed with Tech In Asia that it will inject $215 million of its own money into the round in exchange for a minority stake and a seat on Tango’s board of directors. According to Forbes, the new funding might value Tango at approximately $1.1 billion. The company disclosed that it now has over 200 million registered users on its app (up from 150 million last September), 70 million of whom are active on a monthly basis. Tango managed to stand out from its like-minded peers with an early focus on video messaging, and later went on to introduce games, and add music thanks to a tie-in with Spotify. The investment marks the latest milestone in the mobile messaging wars, following Facebook’s $19 billion dollar acquisition of WhatsApp and Rakuten’s purchase of Cyprus-based Viber for $900 million. It takes $215 million to tango. It’s tempting to consider the investment in light of Alibaba’s business in China. There, the company is attempting to transform itself from a desktop-oriented ecommerce firm to a mobile oriented ecommerce firm as it faces competition from Tencent, which continues to dictate consumer behavior on smartphones with its ubiquitous WeChat (or Weixin, as it’s known domestically) messenger. However, given that Tango’s strongest markets are the US, Western Europe and the Middle East, the investment likely has little to do with Alibaba’s mobile bid in China, and everything to do with its steady encroachment into markets abroad – specifically the United States. There, Alibaba’s business operations have traditionally been focused on business-to-business sourcing, but recently it’s made several investments in mobile-oriented or consumer-facing companies. Last October it led a $50 million round in mobile search firm Quixey, along with a $206 million round for Amazon-rival Shoprunner. It’s also helping fund the launch of 11 Main, a new ecommerce venture that looks set to be a less trendy version of Fab. As a result, backing a California-based chat app gives Alibaba a potential springboard for experiments in mobile shopping abroad. This was explicitly one of the reasons behind Rakuten’s purchase of Viber – the Japanese ecommerce firm  saw dollar signs after WeChat and Line proved that the stickiness of chat apps could translate to big bucks for retailers. If past investments are any indication, however, it will take some time before Alibaba-blessed ecommerce startups make their way onto Tango. 11 Main hasn’t even launched yet, and Alibaba’s investments and Quixey and Shoprunner haven’t yielded any fruits covered in Alibaba’s fingerprints. It seems Alibaba’s strategy for cracking the US consumer market is to finance emerging projects and let them marinate. There’s also the question of how the investment might relate to Laiwang, Alibaba’s struggling chat app for Chinese smartphone owners. While catching up to WeChat in China is no longer an option – Tencent just revealed the app is up to 355 million monthly active users – it’s possible that the Tango team could apply its proven know-how to Laiwang in an effort to give it a much needed boost. But even then it would still seem to late to bring any meaningful impact.
Alibaba’s mobile strong points for the moment remain its Taobao app and Alipay Wallet, the latter of which has processed a total of over $150 billion in mobile payments to date. It also owns a stake in UCBrowser, China’s most popular mobile browser.

Source: TECHINASIA

Xiaomi confirms its first phablet, the Redmi Note, will make its way to customers in May

 Source: TECHINASIA

Xiaomi’s Hugo Barra announced on his Google+ page that the Redmi Note, Xiaomi’s first-ever phablet device, will ship to customers in May. Xiaomi had teased the device on Sina Weibo and Google+ over the course of last week, though today the final specs have been revealed to include (according to the post): Octa-core MediaTek MTK6592 chipset Choice of two configurations — 1.4GHz with 1GB of RAM or 1.7GH with 2GB of RAM 5.5-inch 720p IPS display with full lamination TP Dual-SIM and dual-standby 3200mAh battery 13MP back / 5MP front camera   The 1.4GHz/1GB version will retail for US $129 (converted to local currencies, of course), and the 1.7Ghz/2GB version will retail for $159. Customers based in mainland China, Hong Kong, Taiwan, and Singapore will be the first to get their hands on the Redmi Note. Barra also wrote in the post that the device would make its way to other markets following its initial launch. At Xiaomi’s official Singapore launch last February, India and Indonesia were names as likely destinations for the company, and earlier this week Xiaomi hinted that Latin America might not be far off.

China Mobile’s telco in Pakistan reaches 25 million subscribers, but still an also-ran

Zong is Pakistan’s fourth biggest mobile telco. While that’s not remarkable in itself, it’s notable that it’s actually owned and operated by China Mobile, the biggest telco in the world by subscriber count. This week Zong hit a major milestone, surpassing 25 million customers, according to a company announcement spotted by ProPakistani. That’s out of a total of 125 million mobile subscribers in Pakistan. China Mobile has driven Zong to that figure in just under six years. The Chinese giant acquired Paktel in early 2007 when it only had about a million subscribers, and that became the basis of Zong as it rebranded and reenergized in April 2008.

While the rate of growth seems strong, China Mobile hasn’t met the tough targets it set for itself in Pakistan, which was the carrier’s first attempt at reaching an overseas market. In December 2012, China Mobile Pakistan CEO Fan Yunjun told Pakistan’s Tribune newspaper that Zong was aiming to be number two in Pakistan by 2014. That seems unlikely by the end of the year as the telco’s experienced rivals keep ahead. At the time of that interview, Zong was still fourth, with 17 million customers. Mr. Fan’s aim for the number two spot was likely based on a much-heralded merger with smaller rival Warid. However, China Mobile decided not to bid for Warid and pulled out of contention in October 2013. Mobiilink remains number one with over 38 million subscribers, Telenor is second with 33 million, and Ufone is third with 26 million. Warid is down in fifth with 13 million.

Source: TECHINASIA

China Mobile says most of its 4G subscribers are using iPhones

“Most of our 1.34 million 4G users are using an iPhone,” said China Mobile chairman Xi Guohua today. He was speaking in the post-earnings conference call after China Mobile (NYSE:CHL; HKG:0941) released its Q4 financials, reports Reuters. China Mobile rolled out 4G on December 18. On that day Mr. Xi said that the telco giant aims to sell 100 million 4G on-contract phones in 2014 thanks to greater subsidies. However, this 1.34 million number shows that target will be tough to hit – perhaps even an impossible task. Apple’s (NASDAQ:AAPL) long-awaited deal for the iPhone with China Mobile arrived a week after the 4G launch. Tim Cook and Xi visited a China Mobile store in Beijing to celebrate the new partnership.

China Mobile now has 776 million users, of whom 28 percent are signed up for 3G. The telco could find it tough to persuade its 3G subscribers to shift to 4G without offering lower data package prices. In other news from China Mobile’s Q4 earnings, the company saw a shock drop in profit, falling to $4.89 billion in that quarter. The huge costs of its 4G rollout were the likely cause.

Source: TECHINASIA

Russia's Sberbank delays forum, banks uneasy over Ukraine. March 12, 2014.

 Russia's largest bank Sberbank has postponed one of the country's highest profile investment conferences due to volatility stemming from the situation in Ukraine, the bank said on Wednesday.

The move underscores increasing nervousness in Moscow's banking sector in the face of Western threats of economic sanctions in response to Russia's seizure of Crimea.

Leaders in Washington and Western Europe have signaled they are prepared to impose asset freezes and other sanctions against those responsible for violating the sovereignty of Ukraine.

"In capital markets everything is on hold," said one Moscow-based investment banker who added that deals are now being scrutinised at banks' highest levels.

"Banks are trying to work in something in the legal language and documentation that if there were sanctions imposed, what would that mean," the banker said.

State-controlled Sberbank had scheduled its Russia Forum event for April 10 to 12, but said in a statement it had decided to change the timing to the autumn following feedback from companies and investors.

The forum, held in Moscow, is a major annual event in Russia's business community. It has drawn top Russian and international business people and economists as speakers, as well as top politicians including President Vladimir Putin.

The decision to postpone was made in light of the "lack of short-term visibility around the Ukraine situation (and) uncertain economic dynamics and elevated volatility on capital markets," Sberbank said.

The move comes a week after VTB Capital, the investment banking arm of Russia's second-largest bank VTB, postponed an investment forum scheduled for April 8 to 9 in New York.

"We have rescheduled our NY event in order to ensure the availability of keynote speakers and to confirm those dates that will be convenient for the forum's target audience," VTB Capital said in a statement.

Russia's moves in Ukraine's Crimea region have led to a sharp fall in the rouble and predictions from some economists that Russia could fall into recession.

U.S. Secretary of State John Kerry said on Wednesday that nothing justified Russia's takeover in the Black Sea peninsula but he declined to get into details about the administration's plans to impose sanctions on Moscow if a solution is not found.

"I don't want to go into all of the detail except to say ... it can get ugly fast if the wrong choices are made, and it can get ugly in multiple directions," Kerry said. "So, our hope is that indeed there is a way to have a reasonable outcome, here."

In Moscow, bankers said they hoped that the situation does not deteriorate so far that the U.S. and Europe detonate the 'nuclear option' of freezing dollars held in corresponding overseas accounts resulting in foreign banks being forced out of Russia and trade being disrupted.

"It's a gun where one barrel is pointed at the enemy and the other back at you," said the Moscow-based banking advisor. "If you pull the trigger you'll shoot yourself in the face as well as your opponent. It is nuclear, because trade stops in any direction."

Obama extends sanctions against Russia to include wealthy Putin allies

President Obama has extended financial sanctions against Russia to include wealthy supporters of Vladimir Putin and a bank close to the Kremlin, in a bid to deter Russian military incursions into eastern and southern Ukraine.

Amid growing pressure for a tougher US response to the crisis, the White House also issued a new executive order authorising a co-ordinated economic blockade with the European Union against key Russian industries if the situation escalates.

White House officials also revealed the Pentagon was providing “non-lethal” assistance to the Ukrainian military .

The additional financial sanctions target 20 new individuals, including eight officials previously identified by the European Union. They extend an initial list announced on Monday to add what the White House calls “Putin’s cronies”.

The previous blacklist of 11 officials shied away from touching top figures or oligarchs.

Most significantly, the new blacklist targets several influential businessmen known to be close to Putin.

Gennady Timchenko, who controls the Gunvor Group, the fourth-largest crude oil trader in the world, has a net worth of $15.3bn and was said by Forbes to be “one of the most powerful people in Russia.”

Arkady and Boris Rotenberg, judo friends of Putin and co-owners of SMP Bank and SGM Group, which provide construction services to state-controlled gas giant Gazprom, were among the elites said to have profited from the Sochi Olympics.

Companies controlled by Arkady Rotenberg won at least $7.4bn worth of contracts related to the Games, Bloomberg reported. He is one of the most influential businessmen in the country, according to Forbes.

The new list also targets Bank Rossiya, which the US claims is the personal bank for senior officials of the Russian Federation.

Among the new Kremlin officials who will face asset freezes are Sergei Ivanov, Putin’s chief of staff, and state Duma chairman Sergei Naryshkin, who has vocally supported Russian intervention in Ukraine. Vladimir Yakunin, the head of state-owned Russian Railways, was also on the list.

All those included will have any US assets frozen and a ban placed on any dealings with US companies, which the White House claims will affect their ability to do business globally.

Several Russian politicians openly mocked earlier White House sanctions against government officials, claiming they did not have any assets that could be hurt by the move and would not deter their policy in Crimea.

But officials in Washington insisted the new steps – together with the threat of co-ordinated action with the EU against Russian industry – were intended to send a signal to deter possible Russian military incursions in eastern and southern Ukraine.

“We are concerned by recent Russian military movements. It would be a significant escalation for Russia to move into southern and eastern Ukraine,” a senior US administration official told reporters. “That is part of the context [of these sanctions]; to send a signal that these key sectors of the Russian economy are in play for sanctions.”

Source: theguardian

S&P's on Thursday revised the outlook of Russia to negative

Standard & Poor's on Thursday revised the outlook for the Russian Federation to negative from stable on rising geopolitical and economic risks.

The rating agency affirmed Russia's BBB foreign currency rating.

"The outlook revision reflects our view of the material and unanticipated economic and financial consequences that EU and U.S. sanctions could have on Russia's creditworthiness following Russia's incorporation of Crimea, which the international community currently considers legally to be a part of Ukraine," S&P said in a statement.

Source: Reuters

U.S. : leading economic index rose 0.5% in February

 The Conference Board's leading economic index rose 0.5% in February, after a 0.1% rise in January and a 0.1% decline in December. "The U.S. LEI increased sharply in February, suggesting that any weather-related volatility will be short lived and the economy should continue to improve into the second half of the year," said Ataman Ozyildirim, economist at The Conference Board

Source:  marketwatch

U.S. : Existing homes declined 0.4% in February

Sales of existing homes declined 0.4% in February to a seasonally adjusted annual rate of 4.6 million, the slowest pace since July 2012, theNational Association of Realtors reported Thursday. Sales rates have trended down since the summer as rising mortgage rates and home prices cut affordability. Constrained inventory and unusually poor weather may have also a played a role in weak buying, NAR said. Economists polled by MarketWatch had expected a February sales rate of 4.58 million, compared with a January rate of 4.62 million. The median sales price of used homes hit $189,000 in February, up 9.1% from the year-earlier period, supported by low inventory. February's inventory was 2 million existing homes for sale, a 5.2-month supply at the current sales pace.

Source;  Marketwatch

WSJ: Janet Yellen surprised Investors by saying interest rates will start to go up in Spring 2015

             The Wall Street Journal reports, "Janet Yellen surprised investors in her first press conference at the helm of the Federal Reserve when she tried to specify when the central bank would begin raising interest rates. The Fed, in its policy statement, said the benchmark federal-funds rate will remain near zero for a “considerable time” after its signature bond-buying program ends".

But at the press conference when Ms. Yellen was asked to clarify that timing, she said it is “hard to define” but that it “probably means something on the order of around six months.”

That means the Fed could potentially raise rates sometime in the first half of 2015, assuming it keeps dialing back the bond-buying program at the current pace.

Such a timetable didn’t sit too well with investors.

The Dow Jones Industrial Average fell as many as 210 points before finishing the day down 114 points. Late Wednesday the benchmark 10-year Treasury yield rose to 2.770%, according to Tradeweb, up from 2.714% right before the Fed’s statement. The yield remained at that raised level this morning, while stock markets across Europe and Asia fell.

“It is hard to know if Yellen wanted the market (which has taken it hard on the chin following that particular remark) to start thinking of a mid-2015 hike, but that is what was implied by her statement,” said Millan Mulraine, director of U.S. research and strategy at TD Securities.

The Fed’s latest projections showed most officials—13 of 16—expect to start raising short-term rates in 2015. Just one official expected to begin lifting rates this year and two expected the Fed will wait until 2016. Those projections don’t deviate much from Ms. Yellen’s off-the-cuff remark at the press conference.

But as U.S. stock prices fell and Treasury bond yields rose, many market participants interpreted the projections and Ms. Yellen’s comments as possibly indicating that interest rates could rise sooner and higher than initially expected.

China: Cash flow problems could lead to developers defaulting

A headline-making debt woe afflicting a small Chinese property developer has highlighted an ongoing cash-flow headache in the sector. Industry analysts said they expected some smaller companies to default and home prices to decline in third- and fourth-tier cities.

Zhejiang Xingrun Real Estate Co., a privately-owned small developer in east China's Ningbo City, is struggling to pay a 3.5-billion-yuan (573.8 million U.S. dollars) debt after its capital chain snapped.

Of the debt, some 2.4 billion yuan was borrowed from banks, who are working with local governments to find solutions. Two owners of the real estate firm have been detained by police on suspicion of illegal fundraising.

A preliminary investigation showed that plummeting land prices was one of the major contributors to the money crunch. It is estimated that the company has lost about 1.4 billion yuan from its purchased land because of shrinking value.

Most of Zhejiang Xingrun's business was in Fenghua, a small city under Ningbo. Fenghua has a population of about 500,000. Its land price at the end of 2013 was approximately halved compared with that in early 2010.

"There are high stockpiles in medium and small cities, and the performance of developers based in third- and fourth-tier cities was sluggish in the first two months of 2014," said Zhang Dawei, chief analyst with property agent Centaline.

A possible default by Zhejiang Xingrun is "symptomatic of major themes in the industry -- polarization in favor of larger, better funded homebuilders; oversupply in smaller cities; and significantly slower growth rates and profit margins," Fitch Ratings said in a note.

Zhejiang Xingrun had run into trouble since, firstly, it is a privately owned company, meaning it has limited access to equity funding. Chinese regulations limit the ability of homebuilders to use bank borrowings to purchase land, Fitch said.

Private companies are likely to be more reliant on non-traditional sources like trust funding, which come with high costs.

Second, its core market, Fenghua, is showing signs of overbuilding. Finally, key shareholders of Zhejiang Xingrun were arrested relating to illegal fundraising, which suggests a significant corporate governance lapse.

"We believe there will be further defaults in this industry as these themes will persist, but they will be limited to smaller companies like Zhejiang Xingrun," Fitch said.

Zhang Zhiwei, chief China economist with Japan's Nomura Securities, shared similar views.

Zhejiang Xingrun is the largest property developer in recent years that is at risk of bankruptcy, Zhang said.

"More property developers will face similar pressures as transaction volumes slow and cash flow conditions tighten, and expect this problem to be more severe for unlisted developers in third- and fourth-tier cities with limited access to financing," he said in a research note.

Zhang maintained that China's property sector suffers from overinvestment and has a significant oversupply problem.

The risk is particularly high in third- and fourth-tier cities, which accounted for 67 percent of housing under construction in China in 2013, he said.

The falling price of land in Fenghua is consistent with the deceleration of home price growth in China over the past few months.

Last month, new home prices in 70 major cities tracked by the National Bureau of Statistics rose by an average of 11.1 percent year on year, slowing by 1.3 percentage points from January.

Prices for existing homes rose 6.4 percent year on year, compared with an average growth of 7.4 percent in January. On a month-to-month basis, 57 out of the 70 cities saw rises in new home prices, fewer than 62 cities in January.

Deceleration of home price growth has changed the psychology between home buyers and property developers and boosted a wait-and-see sentiment, even in first-tier cities with a sizzling housing market like China's capital Beijing.

As of March 16, sales of new homes and existing homes in Beijing plunged 57.5 percent and 66 percent year on year, respectively, official data revealed.

Meanwhile, a lackluster property sector has made banks more cautious of offering credit to property developers.

With eyes on cash flow, some developers have chosen to cut prices to cash in. Two local developers in Hangzhou, capital of Zhejiang Province, announced sales promotions in late February.

Combined sales revenue of 30 monitored home developers stood at 66.5 billion yuan, nosediving by 39 percent from January, according to Zhang Dawei.

Major home developers, especially listed ones, are eager to publish impressive financial results. A business slump could cause their stocks to drop.

Li Tiegang, director of the real estate research center of Shandong University, said sales promotions in big cities could lead to similar actions in smaller cities

"We may see some price cuts in two or three months," said Li.

Source:  Xinhua

China : 2014 NPC & CPPCC Sessions

 Premier Li Keqiang addressed the issue of foreign trade. The premier noted China and the US made 100 million US dollars of trade per working hour, and the potential will be huge, as the two sides are negotiating on investment deal.

Regarding China's economic relationship with Europe, premier says as long as they talk to each other with respect, conflicts can be solved. And the investment talks between China and Europe will create favourable conditions for companies from both sides.

When talking about economic cooperation between the mainland and Taiwan, Li expresses his hope of after talks of ECFA can bear fruits to benefit people and firms across the Taiwan Strait. Meanwhile, the premier urges Chinese exporters to upgrade their product and improve the quality.

Source: Xinhua