Dec. 24 (Bloomberg) -- The following are the day's top business stories:
1. Copper Approaches Record as Swiss Franc Weakens on Global Recovery Signs 2. Goldman Adopts Long-Term Incentive Plan to Deter `Imprudent' Risk-Taking 3. U.S. Online Holiday Sales Climb 15% on `Aggressive' Marketing by Retailers 4. Emerging Equity Funds Post First Outflows Since May, Trimming Record Year 5. Santander Will Buy GE's Mexican Mortgage Unit With $1.95 Billion Portfolio 6. Iraq's Oil Minister Says OPEC Might Meet Before June as Price Nears $100 7. Japan's 10-Year Bonds Rise Most Since October Before Consumer Prices Data 8. Mylan Agrees to Pay $65 Million to Settle Claims of Inflating Drug Prices 9. Brazil to Resume Beef Exports to U.S. Next Week After Drug Issue Resolved 10.Roy Neuberger, Money Manager and Art Collector, Dies at 107 in New York 11.South Africa Asked to Join BRIC to Boost Cooperation With Emerging Markets 12.Trichet Exit Looms as Sovereign Debt Woes Keep ECB Rate at 1%: Euro Credit
1. Copper Approaches Record as Swiss Franc Weakens on Global Recovery Signs
Copper rose to almost a record high amid speculation the global recovery will continue into 2011. The Swiss franc declined and U.K. shares advanced for a fifth day before the holiday weekend. Copper gained 0.7 percent, extending this year´s rally to 27 percent. The franc depreciated 0.4 percent against the euro. The FTSE 100 Index added 0.2 percent, swinging to a gain from a loss in the final minutes of trading. The S&P/TSX added 0.1 percent at 1:10 p.m. in Toronto. The MSCI Emerging Markets Index fell less than 0.1 percent, the first drop in four days, as North Korea threatened to wage a "sacred war" if attacked. U.S. markets were closed for the Christmas holiday. Confidence among American consumers probably improved this month, economists said before the Conference Board´s report due to be released on Dec. 28. U.S. stocks completed a fourth straight weekly gain yesterday after data showed the nation´s economy grew more in the third quarter than initially reported and Americans increased spending in November for a fifth month. "The continuing advance of base metals continues to prove the strength of economic growth and the tortuous business of turning on additional supplies of metals," said Michael Smedley, who helps manage C$1.2 billion ($1.19 billion) as a money manager at Morgan Meighen & Associates Ltd. in Toronto. "In South America, the great major mines have been topping out for some time in production. It is not going to get easier, therefore, the pricing should not be getting easier."
2. Goldman Adopts Long-Term Incentive Plan to Deter `Imprudent' Risk-Taking
Goldman Sachs Group Inc., weighing 2010 pay packages for a year that could rank as Wall Street´s second best, said it may grant bonuses that depend on future earnings, in addition to stock performance. The awards would go to "key employees" and be tied to a variety of financial measures including revenue, net income and return on equity, a gauge of profitability, the New York-based company said yesterday in a regulatory filing. Awards may consist of cash, securities or other equity-linked components, and carry provisions allowing their cancellation or return. The plan "is a tool the compensation committee may use to further align incentive compensation with long-term performance," said Stephen Cohen, a company spokesman. Cohen declined to provide figures on potential payouts, saying that awards haven´t been set. Regulators have pushed banks to design pay packages for top employees that would discourage excessive risk-taking, after a financial crisis wiped out firms including Lehman Brothers Holdings Inc. and led to government bailouts. Most firms have interpreted the guidance to emphasize deferred stock awards over cash bonuses.
3. U.S. Online Holiday Sales Climb 15% on `Aggressive' Marketing by Retailers
U.S. online sales jumped 15 percent this holiday season, spurred by "aggressive" marketing by Web- based retailers, a research firm said. Online sales were $36.4 billion from Oct. 31 through Dec. 22, compared with $31.5 billion a year earlier, said MasterCard Advisors´ SpendingPulse, a Purchase, New York-based firm that measures retail sales by all payment forms. Online apparel sales grew the fastest, or 26 percent, while electronics were up 12 percent and department stores 11 percent. Daily online sales exceeded $1 billion on six days this season, which was twice as many days as a year ago, said Michael McNamara, a vice president at SpendingPulse. The growth meant online sales grabbed a larger share of the season´s total sales, he said. "It´s a pretty positive story," McNamara said in an interview. "Retailers started earlier, in the second week of November, and were more aggressive with their tactics -- discounts and promotions. That seemed to drive growth."
4. Emerging Equity Funds Post First Outflows Since May, Trimming Record Year
Emerging-market equity funds posted the first net withdrawals since May in the week ended Dec. 22 amid concern China will continue tightening monetary policy, trimming a record-setting year for inflows, EPFR Global said. For the year, emerging-market stock funds have taken in a record $92.5 billion and bond funds investing in developing economies had inflows of $52.5 billion, nearly seven times their previous annual inflows on record. "Uncertainty about inflationary trends, investors´ fear of being caught up on the wrong side of capital controls and basic profit-taking kept the pressure on EPFR Global-tracked emerging markets funds going into the final week of 2010," the Massachusetts-based research firm in an e-mailed statement. China´s central bank raised bank reserve requirements on Dec. 10 for the third time in five weeks as inflation quickened to its fastest pace in 28 months in November. Home prices in 70 Chinese cities climbed 7.7 percent in November from a year earlier, even after the government raised borrowing costs for the first time in three years, suspended mortgages for third- home purchases and pledged to introduce a property tax.
5. Santander Will Buy GE's Mexican Mortgage Unit With $1.95 Billion Portfolio
Banco Santander SA said its Mexican unit agreed to pay 2 billion pesos ($162 million) for the mortgage operations of General Electric Co. to become that country´s second-largest home lender. Santander will gain a portfolio of about 24 billion pesos in the deal, which will be completed in the first half of 2011, the Madrid-based bank said today in a statement to Mexico´s stock exchange. Santander agreed to pay undisclosed financing costs, according to the statement. Santander is expanding in Latin America´s second-largest economy after agreeing in June to pay $2.5 billion to buy back the stake in its Mexican unit that it had sold to Bank of America Corp. in 2003. GE Chief Executive Officer Jeffrey Immelt has sold units including plastic and reinsurance to streamline the Fairfield, Connecticut-based company, the world´s biggest maker of jet engines, power-plant turbines and locomotives. "This sale is consistent with our strategy to exit non- strategic businesses that lack scale to help reduce GE Capital´s balance sheet while investing in core industrial and commercial finance platforms, including in Mexico," said Mark Begor, CEO of GE Capital, Restructuring Operations, in a statement.
6. Iraq's Oil Minister Says OPEC Might Meet Before June as Price Nears $100
The Organization of Petroleum Exporting Countries may meet before its next regularly scheduled gathering in June, Iraqi Oil Minister Abdul Kareem al-Luaibi said today. He also said he is "happy" with the current price of oil and that Iraq´s output in 2011 will be 1.5 million barrels a day. The minister spoke to reporters in Cairo, where he is attending tomorrow´s meeting of the Organization of Arab Petroleum Exporting Countries. Crude oil for February delivery advanced $1.03 to $91.51 a barrel yesterday on the New York Mercantile Exchange, the highest settlement since Oct. 3, 2008. Prices are up 15 percent this year.
7. Japan's 10-Year Bonds Rise Most Since October Before Consumer Prices Data
Japan´s 10-year bonds completed the biggest weekly gain since October before a report next week that economists said will show consumer prices continued to drop, boosting demand for the fixed payments of debt. Bonds gained as local stocks fell, enhancing the appeal of safer assets. Bank of Japan Governor Masaaki Shirakawa on Dec. 21 warned about risks to the economy from bond yield gains after the central bank left its credit programs unchanged and kept the benchmark interest rate between zero and 0.1 percent. "Deflation is likely to persist next year even if a drop in prices slows down," said Akira Terabayashi, a researcher in Tokyo at Norinchukin Research Institute Co., the central bank for Japan´s agricultural, forestry and fishery cooperatives. "Investors maintained an appetite for buying on dips throughout this week, weighing on yields." The yield on the 1.2 percent bond due December 2020 fell 4.5 basis points to 1.15 percent this week in Tokyo at Japan Bond Trading Co., the nation´s largest interdealer debt broker. That´s the biggest yield drop since the week ended Oct. 8. The price gained 0.403 yen to 100.447 yen.
8. Mylan Agrees to Pay $65 Million to Settle Claims of Inflating Drug Prices
Mylan Inc. agreed to pay $65 million to settle a lawsuit by the U.S. and Texas alleging it inflated prescription drug prices, increasing the cost of reimbursing pharmacies and other providers. The generic-drug maker, based in Pittsburgh, admitted no wrongdoing in agreeing to the payment, it said today in a statement. Since 2003, Mylan has been sued by 18 states making similar allegations, according to the company´s 2009 annual report filed with the U.S. Securities and Exchange Commission. Last year, Mylan, AstraZeneca Plc and Johnson & Johnson agreed to pay $124 million to settle claims they violated the U.S. False Claims Act by underpaying Medicaid rebates, the Justice Department said.
9. Brazil to Resume Beef Exports to U.S. Next Week After Drug Issue Resolved
Brazil will resume beef exports to the U.S. on Dec. 27 after reducing the use of a de-worming drug to meet U.S. guidelines, the South American country´s Agriculture Ministry said in an e-mailed statement. The U.S. Department of Agriculture´s Food Safety and Inspection Service gave authorization for 12 Brazilian meatpackers to resume exports, according to the statement. Beef shipments by companies including JBS SA, the world´s largest meat processor, were suspended in May after levels of the drug Ivermectin exceeded what the U.S. considers tolerable. "This is a recognition of the quality of our products," Agriculture Minister Wagner Rossi said in the statement. The decision "will certainly have an impact on winning new markets." Meatpackers in the states of Mato Grosso, Mato Grosso do Sul, Minas Gerais, Rio de Janeiro, Rio Grande do Sul and Sao Paulo will be allowed to resume exports, the ministry said.
10.Roy Neuberger, Money Manager and Art Collector, Dies at 107 in New York
Roy Neuberger, a co-founder of money manager Neuberger Berman who traded stocks until he was 101 and was a collector of such American artists as Jackson Pollock, Georgia O´Keefe and Edward Hopper, has died. He was 107. He died of natural causes today at his New York home, said his son, Jim Neuberger. "He got to Wall Street in 1929, a few months before the crash. He was 25," his son said. "He worked every day until he was 99." Neuberger bought about 1,000 works of art over the years. Unlike stocks, which he traded for seven decades, Neuberger said he never sold any art.
11.South Africa Asked to Join BRIC to Boost Cooperation With Emerging Markets
South Africa has been formally asked to join the BRIC group of major emerging markets, comprising Brazil, Russia, India and China, bolstering its position as Africa´s champion. Chinese President Hu Jintao wrote a letter to his South African counterpart, Jacob Zuma, to inform him of the decision and inviting him to the BRIC´s third heads of state meeting in Beijing next year, Chinese Foreign Minister Yang Jiechi said in a statement on his ministry´s website today. South Africa, which has a population of 49 million compared with China´s 1.36 billion, is betting on raising its clout on the world stage by joining BRIC, while strengthening political and trade ties within the bloc. The country accounts for about a third of gross domestic product in sub-Saharan Africa and will offer BRIC members improved access to 1 billion consumers on the continent and mineral resources including oil and platinum. Joining the group is "the best Christmas present ever," South Africa´s Minister of International Relations and Cooperation Maite Nkoana-Mashabane told a reporters in Pretoria today. "We will be a good gateway for the BRIC countries. While we may have a small population, we don´t just speak for South Africa, we speak for Africa as a whole."
12.Trichet Exit Looms as Sovereign Debt Woes Keep ECB Rate at 1%: Euro Credit
Jean-Claude Trichet will retire as European Central Bank president next October with the euro area still needing record-low interest rates, according to economists who accurately predicted the region´s monetary policy this year. The Frankfurt-based central bank will keep its key interest rate unchanged throughout 2011 amid low inflation, moderate growth and persisting fallout from the sovereign-debt crisis, said 12 of 17 economists in a Bloomberg News survey. The sample was taken among forecasters who correctly anticipated in January that the ECB´s benchmark would stay this year at 1 percent. The new year approaches with Trichet celebrating his 68th birthday this week after leading Europe´s response to the turmoil, which at one point threatened to destroy the single currency and has already engulfed Greece and Ireland. Even after those nations received international bailouts, the cost of insuring Greek debt rose yesterday to the highest in a month and investors speculate that Portugal may be next to require aid. The euro has fallen 8.7 percent against the dollar in 2010. "Problems in the banking sector won´t be resolved quickly, and banks in peripheral countries will continue to need support," said Juergen Michels, chief euro-region economist at Citigroup Inc. in London. "There won´t be any major inflation pressures that would warrant a rate increase before 2012."
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