China Business Briefs 16/11/13

China’s state-owned companies, coddled by cheap credit and sheltered monopolies for years, face a less comfortable future after Communist Party leaders pledged to give market forces a bigger role in the economy.
The nation is likely to ease interest-rate and energy-price controls after the party this week assigned markets a “decisive” role in allocating resources, according to Wang Tao, chief China economist at UBS AG, who formerly worked at the International Monetary Fund. Other reform options include opening more industries to competition from private operators.

 

The Ministry of Finance (MOF) said Friday that it will issue 20 billion yuan ($3.28 billion) in 50-year book-entry treasury bonds.

The annual interest rate for the bonds is fixed at 5.31 percent, according to a statement posted on the MOF website.

The European Union sees broader access for investment in China as a key issue in negotiations on an agreement that will consolidate 27 bilateral pacts, the head of the EU Chamber of Commerce in China said.

“The more open the market is, the more European investors enter. European companies are very interested in entering the telecommunications, energy, construction, railway and financial service industries in China, if access can be further eased through a bilateral investment treaty,” Davide Cucino, president of the chamber, told China Daily.

BEIJING, Nov. 14 (Xinhua) — China’s electricity consumption, an indicator of economic activity, rose 9.5 percent year on year in October, official data showed on Thursday.

The growth was lower than September’s 10.4-percent rise and August’s 13.7-percent increase, according to data released by the National Energy Administration.

The lack of any mention of financial reforms was one of the biggest disappointments in a generally underwhelming communique released at the end of a pivotal Communist Party meeting in Beijing on Tuesday. The full report from that meeting, published online Friday night, suggests China is planning to shake up the financial sector after all.
China will accelerate interest rate reform and capital account opening while also setting up a system of deposit insurance, according to the 20-page policy document, which didn’t elaborate or set a timetable for the moves.

Companies

CHL Makes Bullish Cross Above Critical Moving Average

In trading on Friday, shares of China Mobile Limited (NYSE: CHL) crossed above their 200 day moving average of $53.62, changing hands as high as $53.81 per share. China Mobile Limited shares are currently trading up about 2.9% on the day.

 

Chinalco Yunnan Copper Resources Ltd (CYU) advises that it has extended the Closing Date of its non-renounceable entitlement offer to eligible shareholders from Monday 25 November 2013 until Monday 2 December 2013. All other arrangements under the Offer remain unchanged. CYU has lodged a Supplementary Prospectus with the Australian Securities and Investments Commission earlier today to record this extension of the Offer timetable.

 

French carmaker PSA Peugeot Citroen (>> PEUGEOT) is preparing for a possible sale of its Faurecia (>> FAURECIA) components division to accompany a tie-up with China’s Dongfeng Motor Group, several sources with knowledge of the situation said.

The separately listed parts maker has hired an adviser to explore the sale of Peugeot’s 57 percent stake either in the market, or to a private equity fund or industry peer, said the sources, who asked not to be named because the talks are private.

Fitch: G-SIB buffers manageable, Asian bank presence growing – Yahoo Finance

Industrial and Commercial Bank of China’s (ICBC) addition to the annual list of global systemically important banks (G-SIBs) highlights the growing importance of Asia to the global financial system, Fitch Ratings says. With ongoing strategies to expand overseas and moves to internationalise the Chinese yuan, Asian banks could increase their presence on the G-SIB list. We believe the 29 G-SIBs are well positioned to meet planned additional capital requirements.

 

 

China Petroleum and Chemical Corporation (SNPAnalyst Report), also known as Sinopec, along with Royal Dutch Shell plc (RDS.AAnalyst Report) is drilling exploration wells in the largely unexplored central China to examine the shale potential in the region.

The belief that China holds the world’s largest shale gas resource has attracted several oil majors including Shell, ExxonMobil Corporation (XOMAnalyst Report), Chevron Corporation (CVX), Eni SpA (E) and Total SA (TOTAnalyst Report) for unconventional gas exploration in the region. Of these companies, Royal Dutch Shell is the first to secure a production sharing contract.

Ping An Insurance (Group) has received regulatory approval to issue up to Rmb26 billion ($4.2 billion) of domestic convertible bonds, according to an announcement on the Hong Kong stock exchange website on Thursday evening.

The company, listed both in Hong Kong and Shanghai, first announced plans for the CB in December 2011 so it has been a long wait. However, the timing of the approval is a bit surprising as observers hadn’t expected the insurer to get the go-ahead from regulators until after Sinopec had issued its planned domestic CB of up to Rmb30 billion.

Posted from Diigo.

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