China Day Ahead: Europe Anti-Dumping Duties on Paper; Datang Renewable IPO
The European Union plans to impose tariffs on Chinese paper to counter below-cost imports that have hurt producers in Europe including Sappi Ltd., according to three people familiar with a trade case that is unprecedented.
The European Commission in Brussels intends to introduce “anti-dumping” duties as high as 39.1 percent on Chinese coated fine paper by Nov. 18 in a case that may also lead to the EU’s first anti-subsidy levies against China, two of the people said on the condition of anonymity because the plan is still confidential. The paper is used for books and brochures.
Datang Renewable IPO
China Datang Corp., the nation’s second-largest power producer, is seeking a $1 billion initial public offering in Hong Kong for its renewable energy unit, according to two people familiar with the plan.
China Datang Corp. Renewable Power Co. has applied to list its shares on Hong Kong’s stock exchange and a hearing is expected this month, said the people, who declined to be identified because the information is private. The unit may list its shares in late December, one of the people said. Telephone calls to the office of China Datang President Zhai Ruoyu outside normal business hours weren’t answered.
Hu Jintao on Yuan
Chinese President Hu Jintao said in a written interview with France’s Le Figaro newspaper and Portugal’s Lusa News Agency that the nation will continue exchange rate reforms of the yuan, the official Xinhua News Agency reported.
Reforms will be controlled and gradual, Xinhua cited Hu as saying. China will allow greater flexibility of the yuan and allow market forces to play a greater role in the currency’s exchange rate, Hu was cited as saying. Hu conducted the interview ahead of a visit to France and Portugal from Nov. 4-7.
Tencent Software Conflict
Tencent Holdings Ltd., which operates Chinese internet service website QQ.Com, has told customers they must remove from their computer software made by 360, a company that develops security applications.
Tencent’s QQ software, which includes chatting and gaming functions, will cease to run on any computers installed with software by 360, the company said in a statement on its website.
Li & Fung Li Ning Deal
The agreement will cover sourcing for a range of brands including soft goods for Li Ning’s running, basketball and lifestyle lines, the company said in an e-mailed statement.
Unipec Rents Tankers
China International United Petroleum & Chemical Corp., known as Unipec, has provisionally hired five supertankers to ship crude from the Middle East, adding to eight vessels that were chartered last week to load in November.
The trading unit of China Petroleum & Chemical Corp., the country’s largest oil refiner, may load as much as 3.51 million metric tons, or more than 25 million barrels, based on fixtures reported Oct. 26 and yesterday by BRS Brokers. Each vessel is a Very Large Crude Carrier used to carry crude or fuel oil.
U.S. stocks rose, with the Standard & Poor’s 500 Index ending near its highest levels of the day, after the Federal Reserve’s announcement of $600 billion of Treasury purchases sent banks higher.
JPMorgan Chase & Co., Fifth Third Bancorp and Bank of America Corp. advanced at least 1.1 percent to help lead gains among lenders. Hartford Financial Services Group Inc. climbed 9.2 percent after lifting its earnings estimate this year. Ford Motor Co. rose 5.2 percent after saying sales increased 15 percent in October.
The S&P 500 climbed 0.4 percent to 1,197.96 as of 4:38 p.m. in New York, the highest since May 3. The Dow Jones Industrial Average added 26.41 points, or 0.2 percent, to 11,215.13, its highest close since the week Lehman Brothers Holdings Inc. filed for bankruptcy in September 2008.
THE FOLLOWING STOCKS MAY BE ACTIVE TODAY:
Banks and developers: China will require a 50 percent down payment from buyers who use housing funds to purchase their second home in a bid to curb speculation, and prohibit use of the funds to buy third homes, the Ministry of Housing and Urban- Rural Development and the country’s banking regulator said in a joint statement. Residents must pay a portion of their income into the fund to be eligible for low-interest loans, while their employers also contribute.
Industrial & Commercial Bank of China (601398 CH), the world’s largest bank by market value, rose 3.2 percent to 4.58 yuan. China Construction Bank Corp. (601939 CH), the second- largest, gained 1.5 percent to 5.28 yuan. China Vanke Co. (000002 CH). China’s biggest publicly traded developer, gained 2 percent to 9.84 yuan. Poly Real Estate Group Co. (600048 CH), the country’s second-biggest, gained 1 percent to 14.58 yuan.
Separately, Poly Real Estate said contracted sales were 8.9 billion yuan ($1.33 billion) and 777,800 square meters last month, and for the first 10 months of the year, contracted sales rose 37 percent to 50.3 billion yuan, and 27 percent to 5.6 million square meters. It also won bids for nine building sites in the Chinese cities of Yingkou, Xiamen, Nanjing, Nantong, Zhongshan, Hangzhou and Chengdu.
Best Miracle International Ltd. (8272 HK): The shipping services provider said it will raise as much as HK$120 million to fund a previously announced project through a placement of as many as 480.4 million shares at 25 Hong Kong cents each. The stock will resume trading in Hong Kong.
China Petroleum and Chemical Corp. (600028 CH): The parent of Asia’s biggest refiner said the company plans to increase its daily processing of crude oil in November by 9.9 percent to an average of 583,000 tons, the official Xinhua News Agency reported, citing the company. It didn’t say if the gain was month-on-month or year-on-year. The stock gained 0.2 percent to 9.08 yuan.
Hopson Development Holdings Ltd. (754 HK): The developer said it agreed to pay 6.88 billion yuan for a project company that’s building 38 loft-style office buildings in a Beijing industrial park. The stock gained 2.2 percent to HK$9.
Mongolia Energy Corp. (276 HK): The mining company said it will issue HK$466.8 million of 3.5 percent convertible notes due 2013 to funds run by Och-Ziff Capital Management Group LLC to fund its Khushuut coking coal project in western Mongolia. The stock fell 1.3 percent to HK$3.05.
Pan Asia Mining Ltd. (8173 HK): The magnetite explorer said it terminated an investment accord because the promised HK$150 million didn’t arrive. Pan Asia’s debt restructuring agreement is therefore canceled, and it will need to settle HK$190 million of notes coming due. Pan Asia also said it’s in talks to issue new shares. Pan Asia will resume trading in Hong Kong.
Renhe Commercial Holdings Co. (1387 HK): The developer said it will issue a further $300 million of 13 percent senior notes due 2016 to Chinese Estates Holdings Ltd. Chairman Joseph Lau. As well, William Browder, head of Hermitage Capital Management said in Chicago that Renhe is the cheapest real estate company in China. The stock gained 1.4 percent to HK$1.50.
SMI Corp. (198 HK): The movie producer will pay 98.2 million yuan to buy or increase stakes in operators of cinemas in Beijing, Shanghai and Chengdu for about 98.2 million yuan. The stock gained 3.2 percent to 49 Hong Kong cents.
Wah Nam International Holdings Ltd. (159 HK): The natural resources investor said it’s considering buying several mining assets overseas. The stock will resume trading today.
Zijin Mining Group Co. (601899 CH): China’s biggest miner said it will divert 342.1 million yuan raised in its 2008 share offering to the Qinghai Deerni mine from eight other projects and capital. Shareholders will vote on the change on Dec. 15, Zijin said. The shares fell 4.4 percent to 9.74 yuan.
EVENTS HAPPENING TODAY: Hong Kong: 8:30am HKMA Norman Chan speaks on QE2. 9:50am Evergreen (238 HK) debut. BLOOMBERG TELEVISION GUESTS SCHEDULED FOR TODAY: 8:10 Stephen Schwartz, BBVA, Chief Asia Economist 9:10 Mark Konyn, RCM Asia Pac, CEO 10:40 Alain Le Couedic, Roland Berger Strategy Consultants Ltd. 13:10 Luca Silipo, Natixis, Chief Asia Economist
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