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Stocks Climb After Lehman, UBS Plans
Tuesday April 1, 10:13 am ET

Stocks Rise on UBS and Lehman Brothers Stock Issuance, Small Contraction in Manufacturing

NEW YORK (AP) -- Wall Street rallied Tuesday, the first day of the second quarter, on news that two banks slammed by the credit crisis are working to raise cash and that U.S. manufacturing is faring better than expected. The Dow Jones industrial average soared more than 220 points.
Investors were pleased to hear that Swiss bank UBS AG said it will issue up to $15 billion in new stock and that its chairman, Marcel Ospel, had quit. Investors chose to look past the bank's announcement that it will take a fresh $19 billion write-down due to additional declines in the value of its mortgage assets and other credit instruments, following an $18 billion write-down last year.

UBS's decision to issue new stock arrived on the heels of a similar announcement by the U.S. investment bank Lehman Brothers Holdings Inc. late Monday. Lehman said it would sell 3 million convertible preferred shares due to "investor interest."

Shares of both UBS and Lehman surged along with the rest of the financial sector, as the news buttressed the view that financial services companies are taking aggressive action to improve their capital bases.

Meanwhile, Wall Street got another boost when the Institute for Supply Management said its March index of national manufacturing activity rose to a reading of 48.6 -- indicating a contraction, but a slower one than in February and tamer than many analysts had predicted.

The Dow Jones industrial average rose 224.15, or 1.83 percent, to 12,487.04.

Broader stock indicators also gained sharply. The Standard & Poor's 500 index rose 23.30, or 1.76 percent, to 1,346.00, and the Nasdaq composite index rose 43.12, or 1.89 percent, to 2,322.22.

Reliance Petroleum to raise $500 mn for Jamnagar refinery

Mumbai, April 01: Reliance Petroleum, a part of Mukesh Ambani-led Reliance Industries, on Tuesday said it will raise 500 million dollars (about Rs 1,998 crore) for its new export- oriented refinery at Jamnagar.

The company has executed a facility agreement to raise the amount for the Jamnagar refinery project, Reliance Petroleum said in a filing to the Bombay Stock Exchange.

RPL is building a 580,000 barrels per day refinery adjacent to its existing 33 million tonnes refinery mainly to export fuel to Europe and the US.

The refinery is expected to be commissioned later this year. Chevron Corp of US has picked 5 per cent stake in RPL and has an option to raise the stake to 29 per cent before the commissioning of the unit.

In 2006, RPL had raised about Rs 6,000 crore through its Initial Public Offering to part finance the refinery project.

Shares of reliance petroleum closed at Rs 167.10, up 6.94 per cent on the BSE

Ambanis among biggest mkt cap losers in 2008

Mumbai, April 01: Flagship companies of two Ambani groups -- Reliance Industries and Reliance Communications -- are among the five biggest losers in the Sensex market capitalisation league during the first three months of 2008.

An analysis of market capitalisation change during January to March period shows that the maximum loss was incurred by investors in Mukesh Ambani-led Reliance Industries, whose value eroded by about Rs 89,624 crore.

Among the top five companies which suffered the most, reliance industries, DLF and Reliance Communication are promoted by richest Indians -- Mukesh Ambani, K P Singh and Anil Ambani respectively.

Realty major DLF was the second biggest loser as the firm witnessed value erosion of as much as Rs 72,848 crore, followed by state-run Oil and Natural Gas Corporation whose worth plunged by Rs 54,573 crore.

ICICI Bank and Reliance Communications lost Rs 51,425 crore and Rs 49,079 crore respectively.

"These are the stocks which moved at the fastest pace during October 2007 to January 2008 period, and these are the ones which suffered a beating this quarter," Taurus Mutual Fund Managing Director R K Gupta said.

This is because in these companies, future growth was discounted and when the market corrected, investors resorted to profit-booking and hence there was a decline in the market capitalisation, he pointed out.

In the 30-share benchmark index, only three constituents -- leading pharmaceutical firms Cipla and Ranbaxy, and FMCG heavyweight Hindustan Unilever -- managed to end in the positive territory.

The remaining 27 firms suffered losses ranging from about Rs 3,600 crore to Rs 89,000 crore.

Sebi proposes to check brokers from inducing speculations

Mumbai, April 01: Market regulator SEBI has proposed to rein in brokers from inducing speculative activities that far exceed investors' risk appetite.

The market watchdog invited public comments on its proposed guidelines that ask brokers not to encourage excessive trading or speculative activity in clients' accounts disproportionate to their financial position.

"Trading members shall not encourage or induce excessive trading or speculative activity in a client's account which is not in accordance with the objectives, risk appetite and financial situation of the client involved," SEBI said in its draft proposals on improving sales practice by members of the stock exchanges.

The market regulator also proposed that brokers would not execute transactions in own account in securities ahead of making recommendations to their clients on such securities. This is to ensure that clients are given fair recommendations.

Besides, SEBI has asked brokers not to indulge in using funds of their clients for purposes other than those prescribed by SEBI.

The instructions proposed by SEBI hint at the market manipulation many brokers indulge in to serve their own purpose.

Some market players are known to be operating through brokers to control market movements.

Sony to offer movies on AT&T phones

Los Angeles, April 01: Sony Pictures Television says it will become the first Hollywood studio to offer full-length movies by cellphone.

The unit of Japanese electronics maker Sony Corp. says it will offer a range of popular titles on special AT&T Inc. phones in May.

The movies, such as "Bugsy," "Ghostbusters" and "Karate Kid," will be among those that have made their theatrical and DVD runs and have been broadcast on TV already.

The titles will be streamed with advertisements in a loop and not be available on demand.

AT&T says it has not yet determined a price on the new subscriber package. Those who wish to obtain the service can only do so on new LG Vu and Samsung Access phones.

World Bank says China growth will slip in 2008

Singapore, April 01: China's economic growth will slow to an estimated 9.4 per cent in 2008 from 11.4 per cent last year, ending five straight years of double-digit expansion, the World Bank said on Tuesday.

Growth next year is projected to ease still further, to 9.2 per cent, with the slack partially offset by robust domestic demand, the Washington-based institution said in a half-yearly report on the East Asia region.

The slower growth, a result of weaker exports, will likely be welcomed by Beijing policymakers who have struggled to cool the economy despite a raft of measures aimed at averting overheating, the bank said.

"While the uncertain global outlook may slow China's exports, the country's growth is expected to remain robust, and the authorities are well positioned to stimulate demand if needed," it said.

"This growth rate reflects not only the ability of Chinese exporters to seek alternative export markets but also the growing role of domestic demand."

The Chinese economy held up in 2007, posting its fifth straight year of double-digit expansion despite slowing exports, especially to the United States, the report said.

However, inflation rose last year and showed no signs of easing this year because of higher food prices, which were made more pronounced due to tight pork supplies, it said.

"With households spending on average more than one-third of their incomes on food, the food price hikes have affected purchasing power, particularly of the urban poor and some rural groups, although higher food prices benefit net food producers in rural areas," it said.

"In addition, international prices of energy, industrial materials and agricultural products continue to rise and will gradually exert their influence on domestic prices."

Premier Wen Jiabao and other officials have repeatedly called for the stabilisation of food prices, voicing worries that rising costs of food could lead to social unrest.

The Chinese government has targeted eight per cent economic growth for this year while aiming to maintain inflation at 4.8 per cent.

Bharti Airtel tests 3G services; set to launch operations

New Delhi, April 01: Bharti Airtel on Tuesday said it has successfully tested 3G applications with various equipment suppliers and is all set to start services as and when the spectrum was allocated.

"We have tested 3G applications at three places – Delhi, Mumbai and Bangalore – on a trial indoor spectrum given to us," Bharti Airtel President (Mobility) Sanjay Kapoor said.

The Department of Telecom (DoT) has already announced to allot 3G spectrum through auction and the existing players like Airtel are gearing to start 3G service which enables subscribers much faster downloading facility and also wireless broadband.

Asked whether Bharti Airtel has the technology to offer 3G mobile services, Kapoor said, "We as an operator have 3G services in Seychelles. Our license for Sri Lanka is for 3G services as well and by the time 3G services are launched in India we will have enough experience.

"Moreover, we have SingTel as our partner who has wide experience of offering 3G services," he said, adding that for an operator who has 2G operations, 3G is just an incremental service.

On the equipment suppliers, with whom Bharti tested the services, Kapoor declined to specify their names but said they engaged more than one network companies.

Currently, Swedish network company Ericsson and Nokia of Finland are vying for market share in the 3G space besides Chinese companies like Huawei and ZTE.

Pepperl+Fuchs to introduce DART technology in India

Bangalore, April 01: Global industrial products manufacturer Pepperl+Fuchs has announced its plans to launch an advanced technology `DART' in India aimed at avoiding explosion in hazardous area operations, including refineries and chemical plants.

German-based Pepperl+Fuchs (PLF) is targeting major refinery players like Reliance and ONGC among others to deploy its new technology 'Dynamic Arc Recognition and Termination' (DART), company's CEO Gunther Kegel said to news agency here on Tuesday.

Traditionally, intrinsic safety technology is used to avoid explosions in plant by means of limiting the electrical power going into the field using power limits circuits which otherwise would produce 'spark/arc' to ignite the explosive materials present in hazardous area of process plants.

"Whereas DART technology allows such high power, which is capable of generating an arc/spark into the hazardous area of the process plant but it avoids explosion to happen by detecting chances of such arc or spark in advance and terminating it before it peaks cause such ignition," he said.

DART is a solution that instead of completely avoiding a spark, helps to handle it if it happens. The solution allows more devices to be connected to one power supply due to high power availability and thereby enable hazardous areas to be treated as normal areas for all instrumentation and automation appliances, he said.

DART technology is one of the five nominees shortlisted for the Hermes award or the equivalent of Oscar in automation at Germany's leading trade fair, the Hannover trade fair.

PLF, which is in the process of acquiring the necessary certification for the base technology in Germany, hopes to launch the innovation in 10 countries with India leading the way.

"We are keen on introducing the technology in India because here we have seen that industries readily adapt new technology," said Kegel.

PLF is currently in talks with end customers in India to familiarise them with the technology. "We are also in talks for licensing the technology to manufacturers of devices where the technology can be adopted," he said.

The technology would significantly help in reducing engineering cost and also component spare part cost. It has an expected life cycle of 10-15 years. Right now the technology was targeted at refineries, oil and gas processing units, chemical processing, pharmaceuticals but the next step would be to leverage the technology in other plants, he said.

The technology developed by PFL in association with the braunschweig based body PTB has several short-term and long-term potential. "In short term it could be adopted for is fieldbus and high power is value," he said.

"The long term potential include using the technology in manufacturing of emergency lighting, is in situ analytics and is operation stations," he said.

Emaar MGF to invest USD 400 mn for four hotels

Mumbai, April 01: Emaar MGF on Tuesday said it has tied up with Marriott International to design and construct four JWT Marriott hotels in New Delhi, Hyderabad, Kolkata and Amritsar, entailing a total investment of over USD 400 million.

The hotel projects are likely to be completed by end of 2010. As part of the agreement Emaar MGF will be the owner and developer of the proposed hotels and Marriott International shall provide advisory and management services for the planning, design, construction and operations, Emaar MGF Executive Vice Chairman and MD Shravan Gupta said here.

Kolkata and Amritsar projects are under development while memorandum of understanding has been signed for the New Delhi and Hyderabad projects, he said.

DoT allows sharing of active infrastructure; tariffs may fall

New Delhi, April 01: The government on Tuesday allowed sharing of active infrastructure by telecom service providers, enabling them to cut costs in network roll-out and pass on the savings to consumers by way of cheaper tariffs.

Issuing the guidelines on infrastructure sharing, Department of Telecom (DoT) said: "sharing of active infrastructure amongst service providers based on the mutual agreements entered amongst them is permitted.

"Active infrastructure sharing will be limited to antenna, feeder cable, node b, radio access network (RAN) and transmission system only. Sharing of the allocated spectrum will not be permitted," dot said in a statement.

Commenting on the development, Tata Teleservices said: "TTSL welcomes DoT`s progressive move to allow active infrastructure sharing. This move will significantly bring down the cost of rolling out telecom network infrastructure resulting in lowering of tariffs and increase in telecom penetration."

Cellular Operators Association of India (COAI), lobby of existing GSM operators, lauded the forward looking guidelines notified by DOT on infrastructure sharing.

"The provisions such as sharing of active infrastructure, further simplification of procedures, enhancement in scope of the USO subsidy support scheme, etc. Would herald a significant acceleration in the growth and expansion on networks and coverage leading to more speedy rollout and delivery of cost effective services in both urban as well as rural areas," T V Ramachandran, Director General of COAI said.

"This is a win-win development for the government, industry and the consumers," TTSL spokesperson said.

COAI also hailed the provision that state governments would be requested to charge same amounts for setting up of the shared tower at par with unshared tower as this would give a much needed thrust to the sharing of resources in the telecom sector.

DoT has said that the licensing conditions of unified access services licenses and cellular mobile service providers will be suitably amended wherever necessary to permit such sharing.

DoT also simplified the procedure to reduce the time for clearance to erect towers and antennas to about 45 days.

Sites located beyond 7 km from airport reference point (ARP) and the antenna height not exceeding 40 meters from airport level need only to be "registered" on wireless planning coordination (WPC) website and clearance to be issued accordingly.