USA

Supreme Court upholds Obama’s healthcare law The Supreme Court upheld President Barack Obama’s healthcare law on Thursday in an election-year triumph for him and fellow Democrats who champ-ioned the most sweeping overhaul since the 1960s of the unwieldy US healthcare system. In a 5-4 ruling based on the power of Congress to impose taxes, the nation’s highest court preserved the law’s ‘individual mandate’ requiring that most Americans obtain health insurance by 2014 or pay a tax.

The justices also preserved, with some changes, a provision of the law expanding the Medicaid health insurance programme for the poor. The decision — written by conservative Chief Justice John Roberts and joined by the court’s four liberals — was a setback for Republicans who mounted unified opposition in Congress to the law before its 2010 passage and who deride it as meddling in the lives of individuals and in the business of the states.

Disaster declaration for Colorado to pave way to fed fundsUS President Barack Obama has issued a disaster declaration for Colorado, where wildfires have forced tens of thousands from their homes. The move paves the way for access to federal funds to combat the blaze, and comes just hours before Obama is due to visit the state. Police said a body had been found in a burned-out home in Colorado Springs. The Waldo Canyon fire has destroyed 346 houses, making it the most destructive in the state’s history. Another blaze in northern Colorado — the High Park fire — has killed one person and has destroyed 257 homes, officials have said. Officials say progress has been aided by improved weather conditions, but the forest service has warned that it could still take weeks to get the wildfires under control.

WORLD

Egypt president-elect joins the protestors President elect Mohamed Morsi of Egypt joined tens of thousands of protesters in Tahrir Square to celebrate his victory and pressurise the nation's ruling generals to restore the parliament and hand power over to a civilian government. Morsi's appearance defied the ruling military council and came before his scheduled swearing-in as the first freely elected president in the country's history. But much of his authority has been curtailed by an army that has seized legislative and executive powers to prevent Islamists from controlling the government. "Revolutionaries, we will continue the path," said Morsi, a candidate for Muslim Brotherhood.

Rwanda’s Victoire Ingabire’s terror verdict postponedA Rwandan court Friday postponed the verdict for opposition figure Victoire Ingabire,

accused of bankrolling terrorism and denial of the 1994 genocide, until September, the prosecutor’s office said. “The verdict has been

postponed till September 7. The judges said they were still examining some points,” Alain Mukurarinda, spokesman for the prosecutor’s office, told AFP. Ingabire, leader of the Unified Democratic Forces (FDU), a political grouping that has not been allowed to register as a party, is charged with ‘giving financial support to a terrorist group, planning to cause state insecurity and divisionism’. Ingabire, a Hutu,

denies the charges. Prosecutors in April called for her to be given a life sentence.

AUSTRALIA

David Jones has received a takeover offer from a mystery entity in the United Kingdom. David Jones shares have soared by more than 17 per cent after the retailer received a takeover offer from a mystery British bidder. The retailer’s Chairman Robert Savage said on Friday he had received an unsolicited letter from a non-incorporated UK entity indicating it was interested in making an offer for David Jones. However, he said he had been unable to find any public information about the entity and the board of David Jones does not believe they currently have enough information to enable them to qualify or value the approach.

Barclays bank is to pay USD 452 million to settle charges that it tried to manipulate key global interest rates. The US Commodity Futures Trading Commission says the incidents occurred between 2005 and 2009 and sometimes took place daily. The commission says Barclays senior management and multiple traders were involved and that they co-ordinated with traders at other banks to make false submissions. Barclays Chief Executive Bob Diamond said that in view of this, he and other senior executives at the bank would forego their

annual bonuses due for work in 2012.

Six hundred workers from Victorian-based aluminium processor Alcoa will keep their jobs for at least another two years, the

company says. The future of the Geelong smelter has been under review since February because of continuing difficult economic

conditions for the aluminium smelting industry in Australia, the Geelong Advertiser reports. “When the review was announced, the Point Henry smelter was facing substantial losses,” said Alcoa of Australia Managing Director Alan Cransberg.

Since then global market conditions, such as exchange rates and the aluminium price, have made the situation worse.

BANGLADESH

London First Textile Limited, a UK company, will set up a garment manufacturing industry in Adamjee Export Processing Zone (EPZ) of Bangladesh. This fully foreign owned company will invest USD 6.468 million in setting up their unit that will manufacture garment items. The company will also create jobs for 2354 Bangladeshi nationals. An agreement to this effect was signed between the Bangladesh Export rocessing Zones Authority (BEPZA) and London First Textile Limited in BEPZA Complex in Dhaka on Thursday.  Sayed Nurul Islam, member of BEPZA, and Chad Miah, managing director of London First Textile Limited, signed the agreement on behalf of their respective organisations. 

Bangladesh’s overall import orders increased significantly in May 2012 over the previous month due mainly to the upcoming holy Ramadan, officials said.

Opening of letters of credit (LCs) against imports, generally known as import orders, increased by 13.60 per cent to USD 3.162

billion in May last from USD 2.784 billion of the previous month, according to the central bank statistics.  “The import orders increased in the month of May to meet the growing demand for essential items including edible oil, gram, onion and lentil before and during the holy Ramadan,” a senior official of the Bangladesh Bank (BB) told the FE, adding that the upward trend of import orders may

continue until mid-July next.

CHINA

Apple Inc’s suppliers in China have violated local labour laws when they imposed excessive overtime and skimped on insurance, a New York-based labour rights group said. Apple and its suppliers such as Taiwanese tycoon Terry Gou’s Foxconn Technology Group have been the target of labour rights groups, which say the world’s most valuable technology company are making iPhones and iPads in massive sweat shops. “From our investigations we found that the labour rights violations at Foxconn also exist in virtually all other Apple supplier factories, and in many cases, are actually significantly direr than at Foxconn,” China Labour Watch said in a 133 page report released on Thursday.

China’s cooling economy should stabilise in the third quarter and the government is confident it can meet its growth target of 7.5 per cent for the year, the chief researcher at the finance ministry said on Thursday. Beijing is ‘cautiously optimistic’ about China’s

economic prospects because it has scope to loosen monetary and fiscal policies to shore up activity, said Jia Kang, director of the Research Institute for Fiscal Science at the Ministry of Finance. “Looking at the second half of the year, we are still confident we can meet the growth target of 7.5 per cent,” Jia said at a financial forum in Shanghai. “We should see stabilisation (in economic activity) in the third quarter.”

EUROPE

Nestle, the world’s biggest food group, has been talking to banks about raising a new seven billion euro syndicated loan to help fund its USD 11.85 billion takeover of Pfizer Nutrition, banking sources said on Thursday. Nestle said in late April the acquisition would be fully debt-financed through internal cash resources, existing facilities and the bond markets. The new loan would give the company enough liquidity until the deal is approved, which is expected to be in the first quarter of 2013, if the acquisition goes ahead, bankers said. Nestle was not immediately available for comment. The new loan is expected to have a short-term maturity of one year, with a one-year extension option, which could lead to a quick bond market refinancing, they added.

After tough all-night bargaining, European leaders appeared to salvage what had seemed to be a summit teetering toward

failure by agreeing to use the continent’s bailout fund to funnel money directly to

struggling banks, and in the longer term to the idea of a tighter union. The bank decision at overnight meetings in Brussels was aimed at helping Spain, which sought a 100 billion euro rescue to help its troubled banks and wound up facing rising borrowing costs for the

government. European Council President Herman Van Rompuy called it a “breakthrough that banks can be recapitalised directly.”

Bank of England Governor Sir Mervyn King has called for a change in the banking culture, saying that customers have received "shoddy" treatment. He added that bank leaders had "let down" the many honest and hard working people in the financial sector. Sir Mervyn's comments come on the day banks were found to have mis sold financial products to small businesses. It is the third major scandal this year, following manipulation of lending rates and loan insurance mis-selling. He said, "That goes to both the culture in the banking industry and to the structure of the banking industry, from excessive levels of compensation, shoddy treatment of customers, to deceitful

manipulation of one of the most important interest rates and now this morning to news of yet another mis-selling scandal.

INDIA

India published draft guidelines to implement rules that target tax evasion but have provoked an outcry among foreign

investors at a time when the country needs capital inflows. The general anti-avoidance rules (GAAR), introduced in the budget

in March this year, target companies and investors routing investments through tax havens. Vague wording and lack of clarity on their implementation left scope for potential misuse, which panicked foreign investors and hammered India’s equity and currency markets. A flight of investors forced the government in May to defer implementation of the guidelines until 2013.

Shares of Cairn India dropped more than six per cent after two sources familiar with the matter told Reuters its UK parent sold part of its stake to a clutch of institutional investors at a discount. Cairn sold about 66.8 million shares in the Indian unit, offering the shares at IRs 307.40 to IRs 317.50 according to a term sheet seen by Reuters on Thursday, below its IRs 327.35 closing price that day. Cairn India shares were last down 6.4 per cent at 306.40 Indian rupees.

Citigroup was the book runner to the transaction, the sources said. On Thursday, sources have told Reuters that the British

oil explorer plans to sell about 3.5 per cent of its holding in the company.

Salaries for temporary jobs are fast catching up with that of permanent ones as more organisations look to hire temporary staff. Not only have companies in India opened up to temping as a concept they have started rewarding talent, skills and longevity irrespective of the macro-economic conditions. These were some of the findings of the comparative analysis of the five annual salary primers released between 2008 and 2012 by TeamLease, a staffing firm. The analysis showed that the gap between average temporary and permanent salaries has

narrowed over the last five years, and is now hardly four per cent. The difference nearly five years ago was in excess of eight per cent.

JAPAN

After years of policy paralysis in Japan, Prime Minister Yoshihiko Noda has pushed a much-needed but unpopular sales tax hike through the lower house of parliament, but the chances of further reform in the world’s third-largest economy seem

unlikely. Noda, 55, is low key and likened himself to a ‘dojo’ bottom-feeding fish when he took office in September last year. However, the sixth prime minister since 2006 is set to achieve a breakthrough that has eluded several of his predecessors. The doubling of sales tax to 10 per cent over three years, a first step towards curbing a public debt that is already twice national output and a record for an industrialised country, was passed by the lower house on Tuesday.

Tokyo Electric Power Co (Tepco) share-holders voted to approve the Japanese government’s one trillion yen capital

injection, to avert the collapse of the utility in the aftermath of the Fukushima nuclear crisis. The capital injection will hand control of Tepco to the government and brings total state support for the company to at least 3.5 trillion yen since reactor meltdowns at the Fukushima Daiichi plant triggered by last year’s earthquake and tsunami. Shareholders at the utility’s annual general meeting also rejected a proposal to scrap all seven reactors at Tepco’s Kashiwazaki-Kariwa plant, the world’s biggest nuclear facility, on the Sea of Japan coast.

Nomura Holdings admitted to widespread failures in protecting confidential client information on Friday and will slash pay for top executives and shut down an equity sales operation for a week as Japan’s largest brokerage tries to resolve a damaging insider trading probe. Nomura said CEO Kenichi Watanabe’s pay would be halved for six months to take responsibility for the brokerage’s third insider trading scandal since he took the helm four years ago. The announcement confirmed the terms of a Reuters report late on Thursday. The broker also said

two executive officers, one in charge of institutional sales and the other head of compliance, would be stepping down after employees were found to have tipped off clients ahead of three planned share offerings Nomura underwrote in 2010.

MALAYSIA

Tan Sri Halim Saad is buying Sumatec Resources Bhd’s flagship shipping assets under a deal that will wipe out the oil and

gas company’s big debts. Sumatec signed with once-influential businessman Halim to sell Semua International Sdn Bhd

(Semua Group) and its subsidiaries. Semua Group owns a fleet of 10 oil product tankers with capacities ranging from 6,000 to 13,000 tonnes. Semua Group, which was bought by Sumatec in 2005, has been the latter’s crown jewel. However, over-gearing as well as

declining profits and cash flows have affected Sumatec’s performance.

Felda Global Ventures Holdings (FGV) Bhd’s positive share performance reflects investor confidence in the stock as well as

on Malaysia’s business entities, Affin Investment Bank head of retail research Dr Nazri Khan said. “Based on the premium, this is a good sign indeed as it shows investors have a lot of confidence in FGV, with a lot of potential buyers out there and also an active domestic fund buying activities,” said Nazri. He said for the medium term, the price of FGV shares hinges on the overall stock market performance of Bursa Malaysia, but Affin Investment targets the stock to hit 5.52 ringgit and possibly 6.00 ringgit by year-end.

PAKISTAN

British High Commissioner to Pakistan Adam Thomson has said that the verdict in international arbitration on the Reko Diq saga may have chilling affects on foreign investors. “Supreme Court of Pakistan’s verdict in certain cases whether it relates to Reko Diq or others is a sign of discouragement for foreign investors,” Adam Thomson said while talking to selected journalists. Tethyan Copper Company (TCC) filed for international arbitration to protect its legal rights after Balochistan rejected its mining lease application. Tethyan Copper — a  joint venture between Chilean copper producer Antofagasta and Canada’s Barrick Gold — owns the massive Reko Diq project in Balochistan with reserves estimated at 2.2 billion tonnes of gold and copper.

Qubee Pakistan CEO Jamal Nasir has said that the dismal economy and sluggish growth in the corporate sector has spelt

difficulties for Pakistan’s broadband sector, which is no longer growing at the pace which earlier brought it laurels from the

global telecom community. “The number of broadband users in the country has not grown in proportion to population growth over the last few years, mainly because of slow growth in the economy,” Nasir said, while speaking to a select group of reporters at a

local hotel here on Thursday. Linking broadband penetration with high gross domestic product, he said economic experts often inter-relate high broadband penetration with high economic growth.

RUSSIA

Moscow expressed outrage over a US Senate panel’s approval of a bill that would penalise Russian officials for human rights abuses, and warned Washington that adoption of the sanctions would force Russia to respond in kind. The Senate Foreign Relations Committee passed the ‘Sergei Magnitsky Rule of Law Accountability Act,’ named after a Russian anti-corruption lawyer whose death in 2009 while in pre-tria

l detention drew widespread condemnation. Despite broad support in Congress, the bill’s future remains uncertain, partly because

the Obama administration is unenthusiastic about a measure that Russia says would be an unwarranted intrusion into its internal affairs.

Mikhail Fridman, a Soviet-born billionaire who is a partner of BP in Russia’s third largest oil company TNK-BP, said that no talks have been held with the British major over a possible sale of BP’s stake. “No, we aren’t in talks,” he said when asked about talks with BP over the sale. BP, which bought half of TNK-BP in 2003 for USD eight billion to team up with Alfa-Access-Renova consortium of the four billionaires, announced on June 1 it had multiple offers to sell its stake in TNK-BP amid flaring shareholder conflict. Sources close to AAR have said the consortium would be willing to buy out BP for USD 25 billion as the partners have been unable to iron out their differences over numerous issues, such as TNK-BP’s strategy and foreign expansion.

THAILAND

As the public debt crisis in Greece spreads to other countries in Europe, risks to financial markets and uncertainty over the

recovery of the global economy have risen. Although Thailand possesses strong economic fundamentals and is not directly linked to the ongoing debt crisis, increasing globalisation and integration may affect Thailand via trade or financial linkages. Exports from Thailand to PIIGS (Portugal, Italy, Ireland, Greece, and Spain) combine for only 1.7 per cent of total exports so a slowdown in those countries should not significantly affect Thailand. However, should the public debt crisis in those countries spread to other countries in Europe, especilly the core countries, the effects on Thailand would be much larger since Thai exports to the Euro Zone accounts for 10.8 per cent of total exports.

The emergence of the ASEAN Economic Community by 2015 and the opening of Myanmar will generate more high-yield

visitors for Thailand by boosting its status as a regional hub for conventions and exhibitions, delegates attending a MICE event were told. These emerging opportunities, as well as the accompanying challenges, were the primary topics of discussion at the first Thailand MICE International Forum (TMIF) 2012 held on June 21. The TMIF was organised as a side-event of the 7th Annual General Meeting of Asian Federation of Exhibition & Convention Associations (AFECA). Its key coordinators were the Thailand Exhibition and Convention Bureau in cooperation with Thailand Incentive and Convention Association, Thailand Exhibition Association,  Thailand Marketing Association and Thai Airways International.

USA

United Technologies Corp on Thursday admitted selling China software that helped Beijing develop its first modern military

attack helicopter, one of hundreds of export control violations over nearly two decades. At a federal court hearing in Bridgeport, Connecticut, United Technologies and its two subsidiaries, Pratt & Whitney Canada and Hamilton Sundstrand Corp, agreed to pay more than USD 75 million to the US government to settle criminal and administrative charges related to the violations. As part of the settlement, Pratt & Whitney Canada pleaded guilty to two federal criminal charges — violating a US export control law and making false statements.

Shares of JPMorgan Chase & Co tumbled as a published report said that the bank’s losses on a bad trade may reach as much

as USD nine billion — far higher than the estimated USD two billion loss disclosed last month. In May, JPMorgan said the loss came from trading in credit derivatives designed to hedge against financial risk, not to make a profit for the New York bank. The New York Times, citing sources it did not identify by name, said that the losses have grown recently as JPMorgan has been unwinding its positions. The newspaper said its sources were current and former traders and executives at JPMorgan, which is the largest bank in the US by assets. The New York Times story cites an internal report that JPMorgan made in April that showed the losses could reach USD eight billion to USD nine billion, in

a worst case scenario.