New York: Oil prices jumped to a new record above $106 on Friday but extended their recent pattern of choppy trading after a weak jobs report convinced many traders that the Federal Reserve’s interest rate-cutting campaign will continue. Employers cut 63,000 jobs in February, the biggest drop in five years, the Labor Department said Friday. Investors can react to such news in one of two ways: by selling on the prospect that the economy, and demand for oil, is cooling, or by buying on a conviction that bad economic data makes it more likely the Fed will cut rates. On Friday, investors engaged in a little of both, sending oil prices down more than a dollar at one moment, and propelling them to new records the next. « The higher the market goes, the more volatile it becomes, » said Darin Newsom, senior analyst at DTN in Omaha, Nebraska. « Does it mean that the rally is over? No. » Light, sweet crude for April delivery rose 46 cents to $105.93 a barrel on the New York Mercantile Exchange after setting a new trading record of $106.54. Lower interest rates tend to weaken the dollar, and many analysts believe the weak dollar is the reason why oil has set new inflation-adjusted records three times this week, and risen 23 per cent in less than a month. Crude futures offer a hedge against a falling dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the dollar is falling. On Friday, the dollar set a new low against the euro Friday before rising. But most investors believe that despite occasional rebounds, the dollar is likely to continue falling as the Fed continues to cut rates. AP
Dubai: Dubai International Capital, the private equity arm of the Dubai Holding, said on Tuesday that it is bidding to buy the Liverpool football club, but said the company has not reached an agreement with the American owners of the club on the valuation. « It’s no secret that we have been in discussions with the current owners. But valuations they expect have been out of sync with our assessment, » Sameer Al Ansari, chief executive of Dubai International Capital (DIC) said on the sidelines of the Private Equity International Forum in Dubai yesterday. Al Ansari did not rule out the possibility of reaching an agreement with the current owners Tom Hicks and George Gillett. Speaking about the valuation, Al Ansari said the Liverpool owners are in a ‘dreamland’. However, he noted that one of them now is coming out of the dreamland. Despite Hicks’ remarks last month that he was not planning to sell a stake in the soccer club, there have been persistent rumours and media reports in recent weeks about DIC’s negotiations with the owners of the club. London-based newspaper The Times said yesterday that DIC was confident Gillett would accept its offer of £200 million ($397 million) for his 50 per cent stake, but added there were claims that Hicks was ready to exercise his option to buy it out. Hicks and Gillet borrowed £350 million ($695 million) in January as part of a refinancing deal. If DIC has offered a total of £400 million as reported by the British media yesterday, the American investors would make a total of £50 million from the deal. If the deal with DIC does not go through, the club will be saddled with an annual interest burden of £28 million on the funds borrowed by the American owners. While Liverpool fans are concerned about the debt burden, Hicks, in particular, has been under pressure after being subjected to heavy criticism from fans following public disagreements with popular manager Rafael Benitez. He has also come under fire for his public admission that talks had been held with Jurgen Klinsmann about possibly succeeding the Spaniard. Update: Owners reject offer Liverpool co-owners Tom Hicks and George Gillett rejected Dubai International Capital’s bid for the Premier League club yesterday, the Associated Press reported. The £400 million ($800 million) offer for the English club was turned down, a person involved with the negotiations said. He spoke on condition of anonymity. Hicks « turned down the offer immediately upon receipt, » the person said, adding the Texan is still willing to allow Gillett to sell 49 per cent of his stake as long as Hicks gets the other one per cent. – AP
Dubai: The Dubai Government has issued a law establishing an event management agency with a capital of Dh150 million to manage and organise cultural and sports events, exhibitions and conferences in the emirate. His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, yesterday issued the law creating the new body. The law states that the Dubai Event Management Corporation will be a corporate body with financial and administrative independence and full legal competence to achieve its objectives. Owned by the Dubai Government, it will operate under the authority of the Dubai Ruler. The new entity is aimed at enhancing Dubai’s position as an international hub for sports and cultural events, conferences and exhibitions. Shaikh Mohammad also issued a decree appointing Shaikh Ahmad Bin Mohammad Bin Rashid Al Maktoum as chairman of the corporation. WAM
Munich: His Highness Dr Shaikh Sultan Bin Mohammad Al Qasimi, Supreme Council Member and Ruler of Sharjah, received here on Thursday Speaker of the Bavarian Parliament Alois Gluck. During the meeting held at the Marriot Munich, they discussed bilateral relations and cooperation between Sharjah and Germany, especially in the fields of economy, culture, science and scientific research. The Sharjah Ruler said the distinct strategic relations between the UAE and Germany are based on mutual respect and enhanced by an equal desire to widen them in the fields of economy and trade. The Bavarian parliament speaker hailed the strong relations between the UAE and Germany, adding that the efforts of the leaders in both the countries have bolstered the relations. The meeting was attended by senior government officials from Sharjah and Germany. The Nation Government UAE and Germany to boost cooperation WAM Published: March 01, 2008, 01:05 Munich: His Highness Dr Shaikh Sultan Bin Mohammad Al Qasimi, Supreme Council Member and Ruler of Sharjah, received here on Thursday Speaker of the Bavarian Parliament Alois Gluck. During the meeting held at the Marriot Munich, they discussed bilateral relations and cooperation between Sharjah and Germany, especially in the fields of economy, culture, science and scientific research. The Sharjah Ruler said the distinct strategic relations between the UAE and Germany are based on mutual respect and enhanced by an equal desire to widen them in the fields of economy and trade. The Bavarian parliament speaker hailed the strong relations between the UAE and Germany, adding that the efforts of the leaders in both the countries have bolstered the relations. The meeting was attended by senior government officials from Sharjah and Germany. Click Here! Dr Shaikh Sultan signed an academic cooperation between the Sharjah Academy of Scientific Research and the German Fraunhofer Corporation. Dr Shaikh Sultan welcomed the agreement during his meeting with Heinz Gerhuser, Chairman of Fraunhofer Corporation, reiterating its importance in the light of good relations, which link between the UAE and Germany in general and Germany with Sharjah emirate in particular. He underscored the interest and need of Sharjah for promising secure energy that is friendly to environment and human health, hailing cooperation between the Sharjah academy and Fraunhofer Corporation. Solar energy On his part, Gerhuser commended the bilateral relations between the two countries, adding that the cooperation would score positive results in the renewable energy fields. The agreement comes in line with care given by Sharjah to sciences and latest technology. As per this agreement, a close cooperation will be established between engineers and scientists of both parties of the agreement to execute joint projects, particularly in the fields of architecture, sewage treatment and solar energy. The joint projects include linking some parts of university district with environment-friendly water filtering laboratory, which guides water consumption, as well as construction of experimental houses to gauge provision of energy to these houses in fierce climate circumstances in the region. Present at the meeting were chairman of Sharjah Chamber of Commerce, Ahmad Al Midfa, UAE ambassador to Germany Mohammad Ahmad and other high ranking officials. Later, the Sharjah Ruler left for Paris on a two-day tour of France. Source : wam
Dubai: Investors offered more than the $550 million ($150 million) Ajman Bank, the UAE’s seventh Islamic lender, was looking to raise in its initial public offering that closed on Wednesday, the bank’s CEO said. « It was fully subscribed in the first week and the oversubscription came in the last three days, » chief executive Yousuf Khalaf said. The sale, the biggest UAE IPO so far this year, was « well » oversubscribed, Khalaf said, declining to say by how much. Ajman Bank plans to open its first branch in Ajman and another nine in the other emirates within two years, Khalaf said earlier this month. « Our intention is to list on the Dubai Financial Market in April, » he said. The bank offered 55 per cent of its shares, or 550 million stocks at Dh1 each, valuing the bank at Dh1 billion. HSBC Holdings advised on the sale. Source : Reuters
Dubai: Saudi Arabia’s railway organisation said it would name by June the winner of its estimated $5 billion project to build a 1,100 km railway across the Saudi desert. Four groups of Saudi and international firms are vying for the 30-year contract to build and operate the rail network linking the Gulf and Red Sea coasts of the world’s largest oil exporter, and final bids are now being invited. « We will know the winner by June, » Mohammad Afzal Khan, adviser to the president of the Saudi Railways Organisation (SRO) said. « The group that asks for the minimum grant from the government and meets the financial models will be the preferred bidder. » Khan said the minimum grant requested was about 6.5 billion riyals ($1.73 billion), declining to name the consortium. Two executives from Saudi construction firms bidding for the project said the minimum grant requested ranged from 6.5 billion riyals to 16 billion riyals, with total project costs estimated at more than $5 billion. Khan said the consortiums would have to put in 20 per cent equity with the remainder coming from bank loans and the government grant. The so-called Saudi Landbridge project includes a 950 km line between the capital Riyadh and the Red Sea port of Jeddah, as well as a 115 km link between the industrial city of Jubail and Dammam, the oil hub on the Gulf coast. Economic boom The Landbridge is one of the projects Saudi Arabia is using to tap a regional economic boom – powered by a quadrupling of oil prices in the past six years – to develop infrastructure, tourism and industry. Kuwaiti logistics firm Agility leads one consortium with US firms KBR, General Electric and Saudi Arabia’s Al Rajhi Bank. Saudi Binladin Group heads a group including Japan’s Mitsui & Co, India’s Ircon International, Germany’s Siemens, Deutsche Bank and Deutsche Bahn. Rajhi Investment leads the group with Mada Company for Industrial & Commercial Investment. Other members include Canada’s SNC-Lavalin and Saudi Arabia’s Samba Financial Group. The fourth consortium, led by Saudi family owned business Al Muhaidib & Sons, includes South Korea’s Samsung Engineering & Construction and French bank BNP Paribas. Source : reuters
London: Spot gold raced higher to a record high of $966.70 an ounce on Thursday, as a fall in the dollar against the euro and strong oil prices boosted investor buying, traders said. Gold was last quoted at $966.00/$966.90 an ounce at 1606 GMT, against $957.50/$958.30 in New York late on Wednesday. Meanwhile, oil rose towards $102 a barrel, trading within sight of its record high, after a supply cut in Nigeria, Africa’s top exporter. Investors have pumped cash into commodities in recent weeks, betting on signs the US Federal Reserve will keep cutting rates to prop up the economy. « The energy complex is a dollar/inflation story as investors have moved into commodities as a hedge against inflation, » said Nauman Barakat, senior vice president at Macquarie Futures USA. Pressure « The ever-weakening dollar, upward inflationary pressures and geopolitical tensions are having a greater impact on the market than the fundamentals. » US crude rose $1.96 to $101.60 a barrel by 1602 GMT, having hit a record $102.08 on Wednesday. London Brent crude gained $1.78 to $100.05. Also boosting prices, output at Nigeria’s Brass River crude stream was cut by 20,000 barrels per day this week due to sabotage on a pipeline, Italian oil firm Agip said. The leak was fixed on Wednesday and output restored. Expectations that the Organisation of Petroleum Exporting Countries (Opec) will not raise output at its meeting on March 5 also supported oil, as did winter fuel demand in the US and Europe. The group will most likely keep its oil output steady at next week’s meeting, the head of Libya’s Opec delegation, Shokri Ganem, said yesterday. Outlook Analysts who use past price movements to predict future direction said a move a few dollars higher for US crude, also known as WTI, could lead to further gains. « With the dollar in free-fall, we would be concerned that if WTI rallies above $102-$103 it would trigger a further surge towards $110-$115, » Barclays Capital technical analysts said in a report. Source: Reuters
Dubai: Gulf currencies rose yesterday as the dollar hit a new record low against the euro, prompting speculation the region’s economies may revalue or drop their pegs to contain inflation. The dollar plunged to a new record low as the US government confirmed that American economic growth expanded at a sluggish 0.6 per cent in the fourth quarter. In mid-afternoon deals, the European single currency raced as high as $1.5185, beating the previous high of 1.5144 that was set the previous day. The greenback also fell to the new trough against the euro after Federal Reserve Chairman Ben Bern-anke signalled the prospect of more cuts to US interest rates on Wednesday, dealers said. Speculators prefer to hold currencies in countries where interest rates are rising or expected to rise in the hope they can increase their potential returns. Saudi Arabia’s riyal, which has been fixed at 3.75 to the dollar since 1986, hit as strong at 3.74 to the dollar. Investors were betting the UAE dirham would appreciate by 2.8 per cent in one year and 4.1 per cent in two years, according to forward rates. Kuwait let the dinar appreciate against the dollar for a second time, taking gains since the country dropped its dollar peg in May to more than six per cent for the first time. Inflation is becoming a growing concern across the world’s biggest oil-exporting region, where price rises hit a quarter century peak of seven per cent in Saudi Arabia and 13.74 per cent in Qatar in the fourth quarter, just off a record. Import costs Costs of Gulf imports denominated in euros have risen on average more than 20 per cent this year, said Elyas Al Gaseer, Middle East head of capital markets at Calyon. « They have come up with a lot of solutions but it seems that all of them won’t stop inflation unless they do something about the currencies, » he said. Oil prices near $100 per barrel would also make it easier for Gulf governments to revalue, adding to speculation they could change policy soon, he said. Dollar pegs restrict central banks’ ability to fight inflation by forcing them to shadow US monetary policy at a time when the Fed is cutting rates in an attempt to ward off recession. In contrast, Gulf econ-omies are surging on a near five-fold jump in oil prices since 2002. Meanwhile, US president George W. Bush yesterday reiterated his administration’s strong-dollar policy. « We believe in a strong dollar policy, » he said at a White House news conference, in response to a question about the weakness of the greenback. Some Gulf policymakers have voiced concerns about the status quo. Qatar is studying revaluing its riyal among options to fight inflation. Source : Agencies
Abu Dhabi: Abu Dhabi Aviation Co PJSC, a UAE-based operator of helicopters and airplanes, surged to the highest in 23 months after the company announced changes to its board of directors last week. Abu Dhabi Aviation rose 38 fils, or 8.2 per cent, to Dh5.02 on the Abu Dhabi Securities Market yesterday, its highest since March 27, 2006. The shares have added 41 per cent in five trading days. « Investors believe the company has great potential and the board changes will help improve performance, » said Motasem Mustafa, head of share trading at the National Bank of Abu Dhabi PJSC. Abu Dhabi Aviation announced on February 19 it had appointed Shaikh Tahnoon Bin Zayed Al Nahyan as its new chairman and named former chairman Shaikh Hamdan Bin Mubarak Al Nahyan as vice chairman and managing director. « I think it’s just speculation because there is no news to justify the recent jump, » said Mahmoud Al Borgi, head of investor relations at Abu Dhabi Aviation. The company, established in 1976 by the Abu Dhabi Government, operates 46 helicopters and three aeroplanes and mainly supports the emirate’s offshore oil, engineering and construction companies. Net income in 2007 jumped 50 per cent to Dh75.7 million ($20.6 million) as revenue advanced 11 per cent to Dh534.4 million. Source : Bloomberg
Abu Dhabi: President His Highness Shaikh Khalifa Bin Zayed Al Nahyan, in his capacity as Ruler of Abu Dhabi, has issued the purchases, tenders, and bidding and warehouses law. The new law, which abrogates the existing law of 1977, is aimed at decentralising government purchases in a way that will strike a balance between powers and responsibilities and achieve a series of goals. The major goals include improving the procurement system and introduce best practices; ease procurement procedures while upholding principles of accountability, transparency, equality and free competition; create a legal mechanism for improving performance; use of the latest technology with regard to e-purchase and e-government; and improve efficiency in handling procurement tasks. WAM
