Citigroup Sees Growth in Spain

Spain is one among the five biggest sources of income for Citigroup within Europe, the Middle East and Africa. It gets more of its revenue outside its home market in comparison to other U.S. lender. Citigroup Inc. (C) is expecting an increase in it's revenue in Spain by 5% to 10% in 2015. It is aware of fees from managing bond sales and share offerings to drive revenue in Spain.


According to the company's spokes person,“Large market capitalization companies always had access to capital markets, but medium-sized ones and companies with lower than investment grade rating needed access, and this has started to change in recent years.”

He added, “Equities will also have a good year in 2015, mainly through capital increases and accelerated equity offers.”

Chief Executive Officer Michael Corbat is working on plans to streamline the bank. The bank is leaving consumer banking in slow growth markets. It's the world's largest lender before the 2008 financial crisis. The bank is pulling out consumer banking from Spain including Japan, Egypt and Hungary. The bank sold all 45 branches, along with its credit card business in June.All together 950 people worked there. Those branches werr sold to Banco Popular Espanol SA (POP) for $296 million.Currently Citigroup now employs 260 people in Spain.

The bank expecting to build its business in Spain as the country recovers from a two-year recession and a sovereign debt crisis that led the government to seek aid from the European Union to recapitalize local lenders.

Country Officer William Van Dyke said,“The dynamics in the Spanish economy are better and we see an opportunity to strengthen and grow our balance sheet in the country.”

Spain is providing a 10-fold profit to Citigroup in comparison to 1990. It has $25 million in assets and increased revenue of 10% to 19% every year for the past seven years. It earned $75 million in fees from investment banking in the year through September in Spain. It has 5.6% market share and has to compete with Morgan Stanley.

The bank has client base of 60 companies. Citigroup arranged Spain's 10-year government bond issue in January and a five-year inflation linker in October.

Goldman Sachs Group Inc. is trying to avoid congressional scrutiny by detaching two commodities units

Goldman Sachs Group Inc. is avoiding congressional scrutiny by detaching two commodities units. One among two paid back it's investment in less than four years and remaining other is still on coa in Colombia


According to documents released by the U.S. Senate Permanent Subcommittee on Investigations, Goldman Sachs bought Metro International Trade Services LLC for $451 million in 2010. It's a  metals warehouse operator. In September 2013, the banks's board viewed a presentation that showed $465 million of gains from the investment. The profit excluded carry charges.

Head of Goldman Sachs’s global commodities principal investments group,Jacques Gabillon, said at a Senate hearing that the firm has received interest from potential buyers in Europe, Russia and China and it is still in the sales process for Metro International Trade Services LLC. The subcommittee chairman, Michigan Democrat Carl Levin, accused the bank of using Metro to improperly influence aluminum prices. Gabillon denied that the bank is involved in influencing aluminum prices.

As aluminum investor rose, Metro International Trade Services LLC increased its warehouses and  a plunge in demand for the metal after the financial crisis. Upto now the stake had returned $501 million in dividends. It had a carrying value of $396 million with debt.

There's still other profitable investment of Goldman Sachs. In 2003, the company purchased Cogentrix Energy Inc. for $457 million. Over the life of the investment it realized $1.75 billion of gains.


Related:
Goldman Sachs posts earnings, revenue that beat expectation

There was not always profit for the company. As of the September 2013 presentation, Goldman Sachs paid $569 million for Colombian Natural Resources, which had produced total gains of $2 million as of the September 2013 presentation. CNR even estimated last year additional cost upto $220 million for port.

Goldman Sachs bet that the price of coal would fall. It produced $246 million of gains, according to the 2013 presentation. According to the report from senate the firm is considering selling its CNR stake.

GlaxoSmithKline on rises after profits beat forecasts

The firm is expecting it's core earning to be "broadly similar to 2013".

GlaxoSmithKline's shares rose 4% after its third-quarter results slides it's way beyond expectation and announces to return an additional £4billion to shareholders by a special share scheme. GSK is one of the world's biggest drug manufacturer and now it is on rise. The UK pharmaceuticals giant published a pre-tax profit of £548m till the end of September for three months. It is way more below than £1.4 billion a year ago. Even then,the results beat analyst forecasts.

Richard Hunter from Hargreaves Lansdown,said the results can be "a turning point". Hargreaves Lansdown plc is a financial service company based in Bristol that sells funds and shares and related products via its website and through the post to retail investors in the United Kingdom.He added,"The drive towards containing costs is also in evidence, whilst the company anticipates significant savings as a result of the restructure. In the medium to long term, Glaxo is also predicting a potentially lucrative pipeline, which should underpin prospects."

GlaxoSmithKline's shares have fallen by 14% over the past three months. It has been accused of allegations of bribery in China and it is even obliged to pay a fine of nearly $500m. GSK's US business was down due to price issues on it's key asthma drug Advair. There is even impact due to high strength of pound.

Now, the manufacturer is up with cost saving strategy. GSK is targeting £1bn of annual cost savings over the next three years and it's  "refocusing" the business. It also said it would consider a possible flotation of ViiV Healthcare. It is a division focusing on treatment for HIV.

The firm is expecting it's core earning to be "broadly similar to 2013".

Andrew Witty, Chief executive of GSK said,"We have continued to make strategic choices to create value from assets held in the group and to respond to the pressures we are facing in our operating environment."

Warren Buffett loses $2 billion in two days

IBM and Coke may be losing money, but Buffett's largest position, Wells Fargo, has raised 11% this year. 

Warren Buffett has lost $2 billion this week. Mr Buffett is known for making most likely estimation about established companies rather than investing in riskier stocks. Buffett is known for focusing on the long-term performance of his investments.

Berkshire Hathaway investment house portfolio includes huge parts of  Coke and IBM, both of which have decline in profits in the past two days. The investment firm took a $1 billion hit on Coke (KO), which fizzled 6% on Tuesday after the company reported earnings that didn't live up to expectations of investors. Worsening the situation, Coke said it doesn't expect a much better 2015.

Berkshire Hathaway's one of the lasgest investment is Coke. It holds 400 million shares and his son Howard sits on the beverage company's board.

On Monday,IBM (IBM, Tech30), another top holding, caused Warren Buffett a loss of $1.3 billion as the stock plunged. The company is looking for a revitalization after reporting disappointing earnings and shedding its chip unit at a major loss. The stock dropped 7% on Monday after then news was made public and slid again on Tuesday. It is off nearly 13% so far this year, and Buffett's company, Berkshire Hathaway holds over 70 million shares.

Buffet has been actively quoted a lot this year for his misses. Berkshire Hathaway's investment on British grocery chain Tesco (TSCDY) has also been a loss, with maximum drop: nearly 47% this year.

On the other hand, there's silver lining and it's more vivid, investors are supporting the company. Berkshire stock climbed slightly on Monday and Tuesday, and is up more than 17% this year.

IBM and Coke may be losing money, but Buffett's largest position, Wells Fargo, has raised 11% this year. And eventhough the market goes down, Buffett is adding more stocks to his portfolio.He said in an interview  "the more stocks go down, the more I like to buy."

Morgan Stanley's total revenue for the quarter rose 12% to $8.91bn.

Morgan Stanley's total revenue for the quarter rose 12% to $8.91bn.

Morgan Stanley has reported an 87% jump in profits to $1.65bn (£1bn) in the three months to the end of September. Morgan Stanley is a US investment bank.Since it is a investment bank, it is different from other commercial banks. It handles trading of currencies, commodities and bonds was a big driver of profits, wealth management and even,advising high earners on their finances.

It's bond trading activities have reportedly benefited inspite of  obstacles at bond giant Pimco.

This September, Bill Gross,trading superstar  made a surprise exit from the world's biggest bond firm.
The departure of the superstar,Mr Gross from Pimco induces investors to withdraw billions of dolklars from the company and remaing could be used to learn other trading business.

Morgan Stanley's total revenue for the quarter rose 12% to $8.91bn.

19.4% to $997m were from bond trading and in addition to that wealth management revenue rose 9% to $3.79bn.

Similar to it, Goldman Sachs reported a 50% rise in profits.

As of September 30, 2014, the Firm’s Common Equity Tier 1 risk-based capital ratio was approximately 14.3% and its Tier 1 risk-based capital ratio was approximately 16.1%. The Firm is subject to a “capital floor” such that these regulatory capital ratios currently reflect the U.S. Basel III Advanced Approaches (“Advanced Approach”) transitional rules, which represent the lower of the Firm’s capital ratios calculated under the Advanced Approach and U.S. Basel I and Basel 2.5 capital rules, taking into consideration applicable transitional provisions under U.S. Basel III.1

Compensation expense of $4.2 billion increased from $4.0 billion a year ago primarily driven by higher revenues. Non-compensation expenses of $2.4 billion decreased from $2.6 billion a year ago primarily reflecting lower litigation costs.

Chairman  James Gorman said,"We are well positioned to create superior returns for our shareholders, particularly as the US economy continues to strengthen."

Goldman Sachs posts earnings, revenue that beat

Goldman Sachs stunned analysts working on Wall Street when it reported third-quarter earnings of $4.57 a share on revenue of $8.39 billion. 

Goldman Sachs stunned analysts working on Wall Street when it reported third-quarter earnings of $4.57 a share on revenue of $8.39 billion. The report tells more earnings per share and more revenue than expected by the analysts.

Goldman was expected to deliver third-quarter earnings of $3.21 a share on $7.85 billion in revenue. This was from Wall Street.

Even though Goldman is the latest bank to report earnings this week. So far, it's been a mixed bag for banks with JPMorgan Chase missing earnings estimates, Wells Fargo reporting in line and Citigroup topping earnings estimates.

During the quarter, Goldman announced it would repurchase residential mortgage-backed securities bought by Fannie Mae and Freddie Mac from 2005 to 2007.  It would pay $3.15 billion for repurchase.

10% market drop is likely-JPMorgan’s executive officer for assets management

"U.S. stocks are likely to fall by a little or tumble a lot. Just nothing in between," Mary Callahan Erdoes of JPMorgan Chase & Co. (JPM), said at an event of Institute of International Finance in Washington.
Erdoes adds,“It would be very healthy, but we’re not going to get a 10 percent correction.”
“We’re going to get a 2 percent correction with a lot of cash coming in on the way down, or we’re going to get a real correction, and it’s going to be a lot worse than 10 percent.”

The Standard & Poor’s 500 (SPX) Index fell 3.1 percent for the week, the most since May 2012, and has declined 5.6 percent from September.

“It’s such a psychological game that long-term investors don’t play,” Erdoes said.

With $1.71 trillion in assets under management and being a leader of it, she is concerned that as more companies shift to defined-contribution programs from defined-benefit pension plans, business units- individual people will make investment decisions based on emotion and that will cause decline.

CSX-Union Pacific stock trading, which one will outperform other?

CSX has risen 16 percent since March 23,2011

New investors are attracted to CSX as CSX’s coal shipments show signs of stabilizing.The number of coal carloads CSX transports was up 3 percent for the week ended Oct. 4 from same period a year ago after years of contraction.

Since March 23, 2011,CSX has risen 16 percent, compared to Union Pacific’s 119 percent gain. Even though the  stock-price ratio is close to the lowest since 1981, it’s up 0.8 percentage points this month, the biggest increase in a month. The point is whether investors will start putting more capital into this trade now that it’s at a multidecade low.

“Fewer coal-related headwinds have been the overarching driver”said Ben Hartford, an analyst with Robert W. Baird & Co. in Milwaukee.

Based on Jacksonville, Florida,CSX is generating 24 percent of total 2013 revenue transporting coal and is more dependent on this commodity while Nebraska-based Union Pacific generates 19 percent.
CSX stock lagged behind Union Pacific because of declining the price of natural gas which made it cheaper alternative for utilities.

Union Pacific hauls primarily Powder River Basin type coal, which is cheaper than CSX’s Appalachian variety, so it's volumes declined less.

 CSX stock could “narrow the gap” with Union Pacific as coal becomes a “less significant headwind” for CSX, Hartford said.

Jim Stellakis, founder and director of research at Technical Alpha Inc. in Greenwich, Connecticut, said that the pair-trade ratio could “move sideways” for a few months before there’s a clear sign that a possible downtrend in place since 2011 has broken. If ratio goes up overcoming a recent high in January 2014 -- “that’s a good sign there’s a switch under way, as investors are starting to see more value in CSX relative to Union Pacific.”

Investors like Timothy Ghriskey, chief investment officer at Solaris Asset Management LLC in New York, does not follow the bet because his company currently hols Union Pacific. CSX has been plagued by congestion on its East Coast rail network, Ghriskey said. The company increased hiring and capital spending to alleviate this. Also that it relies more on the export market for coal, specifically China, where demand has been weak.
Still, the performance gap between these two stocks could reverse, as it has in the past, said Hartford, who maintains a neutral recommendation on Union Pacific and an outperform on CSX.

Driven largely by it's higher margin, CSX outpaced Union Pacific, between 2002 and 2008.
CSX is scheduled to report third-quarter results Oct. 14, followed by Union Pacific on Oct. 23. The implied one-day stock-price move after the announcement is about 3.5 percent for CSX.
Ghriskey said “pair trade is certainly something to watch,” even for investors with a position in only one of these stocks,

S&P 500 index for Asian stock rises.

The dollar held losses and  with the regional index is up from its lowest level since May,Asian stocks has climbed, and bonds rallied with oil and copper on bets monetary policies in the three largest economies will be accommodating.

Chinese shares in Hong Kong raised 1.1 percent following Premier Li Keqiang's announcement to lower financing costs. The MSCI Asia Pacific Index (MXAP) rose 0.8 percent till the morning in Tokyo.  With addition of 0.2 percent in futures in  Standard & Poor’s 500 Index, the gauge jumped the most this year on speculation that low rates will be set and global growth will be slowed by Federal Reserve. When Oil in New York rebounded 0.5 percent and copper climbed 0.7 percent, Japan's five-year bond yield fell to the lowest after the central bank's unprecedented easing.

Tesco's share price has fallen nearly 50%, a huge mistake by the Sage of Omaha, Warren Buffett

Tesco's share price has fallen nearly by 50% reducing the value of investment by 50%.

The Sage of Omaha has said that his decision to invest in Tesco is a "huge mistake."
Berkshire Hathaway firm owns a 3.7% stake in Tesco, worth hundreds of millions of dollars and now  the supermarket's sales are declining and in addition to that share price has fallen to an 11-year low this year.
Tesco shocked investors last week by issuing a string of profit warnings. It revealed it had overstated its expected half-year profits by £250m.

The chairman of the Parliamentary Business Committee, Adrian Bailey, has described Tesco's error as "stratospheric".

He told on CNBC,"I made a mistake on Tesco. That was a huge mistake by me."

Mr Buffett is famous for comprehensive ability to understand the performance of a business for long period of time but now it does not seem so. The risk this time in Tesco are high.

Berkshire Hathaway's portfolio consist names like Coca-Cola, IBM and American Express and it started to include Tesco in 2006 and by 2012 owned more than 5% of the business.

What happened next?
The stake had fallen to 3.7% by the end of 2013 , with investment capital of  $1.7bn and continuing the fall since then Tesco's share price has fallen nearly 50%. It has now made the value to investment half of it's original value.

In addition to that Tesco has seen declining sales amid increased competition. The discount retailers like Aldi and Lidl are in the in the market and Marks & Spencer and Waitrose are providing high end offerings to attract customers.

Tesco says  Financial Conduct Authority (FCA) has been notified it that it is under investigation following its admission last week that it overstated its half-year profit guidance by £250m.
The supermarket giant will co-operate fully with the FCA and other relevant authorities.

The news induced a new fall in Tesco's share price, its lowest for more than 10 years. leaving it down 3% at 180p.

Tesco has itself has  launched its own investigation into the issue.  Deloitte, together with Freshfields, the group's external legal advisers will do the investigation.

Four executives were suspended in connection with accounting problem and there was change in high level management. Chief executive Dave Lewis has only been in the job a month, while chief financial officer Alan Stewart, who was originally due to join the company on 1 December, had his start date brought forward and took up the post last week.

$550m of HSBC for mortgage case with US regulators

Bank of America in August paid $16.7bn  and HSBC is on the row. It is the 16th bank to reach an agreement with the Federal Housing Finance Agency (FHFA) over the issue. Royal Bank of Scotland and Nomura have yet to settle their cases.


It si said that the British bank HSBC will pay $550m (£338m) to US regulators in order to resolve the claims of mis-sold mortgage-related bonds that it sold to US mortgage giants Fannie Mae and Freddie Mac between 2005 and 2007

HSBC said it was "pleased to resolve the matter".

The bank was accused  of making $6.2 billion of mortgage-backed securities apparently standard and meeting all guidelines while they were not fulfilling those requirements. HSBC has previously denied the allegations.

$17.9 has now been recouped from settlements with banks by the FHFA.

HSBC's fine is significantly much less than that of US banking giant Bank of America.

Fannie Mae and Freddie Mac were bailed out by US government and it lost more than $30bn in the financial crisis. Some of it's investment were in subprime mortgages.

Bank of America $16.7bn settlement increased it's share price even though the bank's profit will decrease.

Bank of America and US authorities has reached to the settlement that it will pay $16.7bn (£10bn) to US authorities for misleading investors about the quality of loans it sold. The settlement will cut the bank's third-quarter profits by $5.3bn. The associate attorney general said "no institution is either too big or too powerful to escape" punishment.

On Wall Street, shares in Bank of America opened 1.5% higher following the settlement.

It is considered a historic step forward. The cash component consists of a $5 billion civil penalty and $4.63 billion in compensation payments.

Before Bank of America bought the loans in 2008, these loans were sold by Countrywide Financial and Merrill Lynch.

Much of which will go towards homeowners struggling with their mortgages and Bank of America will provide consumer relief worth about $7 billion and  pay a total of $9.65 billion in cash.

There is intense focus on Merrill Lynch selling mortgage loans to investors without explaining the full extent of the risk involved and Countrywide Financial lending biggest amount at the time of the crisis.

"We believe this settlement, which resolves significant remaining mortgage-related exposures, is in the best interests of our shareholders, and allows us to continue to focus on the future" Brian Moynihan, chief executive of the bank, said.

It's a step to hold Wall Street accountable for the bad conduct that led to the financial crisis. And the sums involved in Bank of America's settlement dwarf the $13bn paid by another banks, JP Morgan to resolve a similar matter. The penalty exceeds Bank of America's entire profits last year yet this deal brings a measure of closure. This settlement of bank was the biggest remaining hurdle of all cases. The bank has already paid tens of billions of dollars to settle cases related to the financial crisis.

Bank of America paid $9.5bn to settle charges that it misled US mortgage lenders Fannie Mae and Freddie Mac over mortgage securities, in March this year .

BP's share highly under performing due to Western sanctions on Russia

Sanctions against Russia is viewed as an obstacle for BP to keep it's business at normal pace. BP just posted a rise in second quarter profits. BP has around a 20% stake in Russian energy giant Rosneft and the sanctions against Russia due the Ukraine crisis can affect BP in future. BP said, "Sanctions could adversely impact our business."

BP is worried about the impact of sanctions and relationship with Rosneft. The crisis may affect the level of income, production and reserves as well as BP's investment and reputation. The company's second quarter profits is $3.2bn (£1.9bn), up from $2.4bn in the same period last year. For the second quarter, BP said higher oil production in higher-margin areas such as the Gulf of Mexico had boosted its profits. But for third quarter, the production is not expected to be high as second quarter due to the seasonal maintenance in Alaska and the Gulf of Mexico as well as the planned major turnaround.

BP has around a 20% stake in Russian energy giant Rosneft and the sanctions against Russia due the Ukraine crisis can affect BP in future.

If the sanctions become more intense, there could be prohibition of exports of technologies used in the Russian Oil sector.

BP's share price is affected along with political conflicts as BP is more exposed to political situations in Russia than any of its competitors. Analysts are seeing BP's share hugely under-performing. BP's share price had risen by 2% since early June, while Royal Dutch Shell, Exxon Mobil and Chevron had each increased by more than 9%.

On Tuesday, BP shares were up during early trading, but later fell 1.6% to 489p because of the impact on western sanctions on Russia and it's still going down.

Russia's move to prevent itself from high inflation and low investment.

From 7.5% to 8% now. Russian interest rate has increased.

Russia is acting to prevent their economy from the risk of high inflation. The situation in Russia after sanctions from west and recent tension in Ukraine are viewed as the major factors for the probability of increment in inflation.

Since the European economy is in stress and whole Eurozone has low inflation of 0.5%, Russia is also experiencing the stress and other restrictions too. With raising pressure from the west and it's conflict with Ukraine, Russia is anticipating high rate of inflation and in order to check the  risk of high inflation Russian Central bank decided to raise the interest rate by 50 basis points, or half a percent, to 8% per year. In June, core inflation grew to 7.5%, well above the bank's forecast of up to 6.5% for the year.

Analysts were not expecting such changes in the interest rate. They are aware of the vulnerability of the Russia's economy.After sanctions were implemented domestic stocks and the rouble tumbled earlier this year. Analyst are observing the concern of central bank for the potential impact.
The bank is working to reduced the inflation risk  which are caused due to a combination of factors, including, inter alia, the aggravation of geopolitical tension and its potential impact on the rouble exchange rate dynamics, as well as potential changes in tax and tariff policy. The bank point outs the main reason for inflation acceleration is the effect of the observed rouble depreciation on prices of a wide range of goods and services.

While anxious investors are pulling their money out, the exchange rate might still go down.

The consumer price growth rate increased to 7.8% in June and the bank trying to put down the consumer price growth to 4% with increased interest rate.

Russia is concerned about the money leaving from the country. Analysts view this act as  move to prevent large amount of money to leave the country.With such tension in the reason, investors are still searching for the better reason to invest.

Microsoft after Bill Gates and Steve Ballmer. Satya Nadella

Microsoft is making a history again, it's cutting up 18,000 jobs. This is the highest cut in the company's thirty nine years of history. Most of the cuts will be in a recently bought unit, Nokia. It is estimated that around 12,500 jobs will be cut for the unit. This is being announced with 18 months of closing acquisition. Microsoft pledged to cut $600 million per year in costs.

The firm was expected previously to reduce 6,000 initially and while the actual cut are being announced, it became more sever,18,000 jobs. The firm has 127,000 employees world wide.

While it's reducing the number of employees it's not yet specifying locations yet.

The company  is also changing it's core business focus. The company is a software giant and it's still is. But, new CEO is offering something that might be questioning the trust of the investors. In February Microsoft appointed new CEO Satya Nadella who wants the firm to shift it's focus to online services, apps and devices away from software.
The firm is focusing on efficiency by reducing the chain of command and having fewer layers of management. IBM was weak at to reduce it while competing with the firm during the era of technological warfare.

He wore in an announcement,"Making these decisions to change are difficult, but necessary."

The firm is going to complete the re-size by the end of June next year.  It said the affected staff would be notified over  the next six months.

In total it said the cuts, including severance pay, would cost it between $1.1bn to $1.6bn (£643m to £935m) over the next year. Though it might seem to be costly for the company to cut job this will put the company in more favorable situation in coming years. The company will find itself in position where salary to employee and other expenses are much less than at present.

Analyst are still hopeful about the company's ability to be successful in online world. Satya Nadella is expected to put forward massive changes in the company.

Using it's $7.2 billion acquisition and all other resources, Microsoft is working to be a leading company in mobile devices and cloud based services. Satya Nadella is willing to put productivity and innovation as the focus of the company. It's seems the firm will be working in many innovative ideas to get what's useful for people. It's now focusing on Skype and Cortana.

Mr Nadella recreated image of the firm as "the productivity and platform company for the mobile-first and cloud-first world." The company may become leading one, it's time which will show us the result but for now there are people who will have to bear the impact. The cuts are expected to helping Microsoft in the competition with tech giants like Google and Apple.

This has impact on the stock price of the firm. Recently after the news, the stocks were up by 2%. While the world market is being hit by geopolitical unrest, the firms stocks are in increasing trend.

The firm is working to combine three operating systems into one single operating system. Nadella said "this means one operating system that covers all screen sizes." While windows is popular for making versions of the operating system, it's now a bold step for the firm.

Nadella is up with one team and a common architecture to combine Windows, Windows Phone and Xbox.
This could be one of the best step taken by the company to provide universal apps.


Here the analysis of the stock in Nasdaq.

Microsoft is making a history again, it's cutting up 18,000 jobs.This has impact on the stock price of the firm. Recently after the news, the stocks were up by 2%

World Markets affected by geopolitical unrest.

World markets plunged down on Friday after Malaysian Airlines Plane crash. The tension in Ukraine affected markets world wide. It has been said that the Flight MH17 was brought down by a surface-to-air missile over a region where Ukrainian government forces and  pro-Russian rebels are fighting.

As the news of crash spread, Japan's Nikkei tumbled by 1% and Germany's DAX fell 0.35%.


Russia and Germany has close trading ties, and it's been anticipated that Germany might lose more than most from a deepening crisis. After the crash, Moscow is going to experience pressure from the world to resolve the conflict between Russia and Ukraine. Such political unrest has affected markets around the world.

On the other hand, aviation stocks are falling in Malaysia, it fell by 0.4%. Four months earlier Flight MH370 disappeared, this is the second tragedy to hit the airline business this year.
After the attack, the most actively traded stock in Kuala Lumpur, Malaysia Airline fell by 11% while Malaysia Airport slide down nearly 5%.


While the tension spread and Russian stocks were also on the slide, extending Thursday's losses triggered by the announcement of new U.S. sanctions targeting leading Russian energy companies and banks on the other hand, the West is trying to pressure Moscow into ending its support for the rebels in Ukraine.


Investors were further thrilled when Israel sent ground troops into Gaza.

On Thursday, US stocks were also seen affected : the S&P 500 declined about 1.2%, the Nasdaq slid 1.4% and the Dow closed down almost 1%, the drop for the Dow was the biggest in two months, and the S&P's fall was the steepest in three months.

While stock markets were falling gold price was up 1.5% higher. The VIX index, which measured market volatility rose up by 36%.


While these events affected world market after the news, Wall Street bounced back Friday.

Political Unrest and shares prices in US

A Malaysia Airline Flight 17- a Boeing 777 crashed in Ukraine border near Russia, on Thursday. Israel began a ground invasion into the Gaza strip. This caused  decline in US shares. Investors have lost the confidence after these political unrest.

The S&P 500 plunged 23.45 points or 1.18%, to 1,958.12,
The Nasdaq index dropped 62.52 points or 1.41% to 4,363.45.

Closing back below the symbolic threshold of 17,000, the Dow Jones index fell 161.39 points, or 0.94%, to 6,976.81

Earlier in the day of new US and European Union sanctions on Russia, such new has made impact in US share market.
Such uncertainty and tension, along with the Israel's invasion into Gaza, investors are attracted to invest in assets like gold and US treasury bonds. Gold futures jumped $17.10, or 1.3%, to $1,316.90 an ounce on strong demand.

NRB increases limit on margin call

Nepal Rastra Bank, through its Unified Directives-2071 has increased the limit on margin call. It's been anticipated positively by stocks market.According to the new directive, marginal call up will not be needed up to 1.5 times of the security coverage.

When price of securities is enough to cover 1.5 times of the loan issued against it, Development Banker's association is against of making margin call.

What happens with this new margin call limit?
The new limit for margin call allows share investors to get loan package and there's no necessary margin call even if the price of scrip falls by 10 percent.

Now the BFIs can issue a margin call to a borrower to meet the required margin within seven days only if the price of scrip goes beyond 1.5 times of the security coverage.

Meanwhile, the central bank has become more flexible to promoter shareholders of a listed company by allowing the promoter/ promoter group to file candidacy for public director as well. Promoters can fight for public directors, too.

When BFIs have been asked to convert more of their promoter shares to ordinary shares, NRB has stated such provision.

Apple Stock and Steve Job's death.

"Apple's stock price has risen more than 9,000% since Jobs returned in 1997. The shares have more than doubled in the past two years."-Julia Kollewe, Theguardian.com, Thursday 6 October 2011 09.37 BST

 After Job's death, news of Steve Jobs's death drove the Apple share price down more than 5%. Now after more than two and a half year, Apple's stock price is up now but not as expected. It even reached $750 and above.

Innovation:

Some investors even question the firm's ability to do something that's never been done before. Apple is also perceived to lack innovation now. It's the only thing that created the value for the company. The change in the pattern of how people use various products in their lives are always influenced by new  innovation. 

There is still hope in the because recently it announced that it will be launching new product in the market.

Stock Split:

Apple announced that there will be stock split with the split ratio of seven-for-one( 1:7). This will reduce per share price of the company by seven time while the trading starts again. Apple’s split is scheduled for June 9, benefiting all who own the shares as of June 2. 

There are various aspect of the company that has changed though. See More

Tim Cook is up with a strategy to sustain the company when large companies like Samsung, Google, Microsoft are increasing their market share. The recent acquisition: 

"As part of the acquisition, Beats co-founders Jimmy Iovine and Dr. Dre will join Apple. Apple is acquiring the two companies for a total of $3 billion, consisting of a purchase price of approximately $2.6 billion and approximately $400 million that will vest over time." -Apple Press Info.

Cook has even proposed a robust stock buyback program but Apple shares are down 10% this year.

What investors and general public is demanding is the product that revitalize what Apple is all about. The company's future rest upon it and if it happens then only the company will be able to see it's golden period that it used to have when Jobs was the CEO of Apple.

Standard Chartered Bank, Rs 1 billion net profit,17.86 percent increase in net profit

Standard Chartered Bank Limited has 17.86 percent increase in net profit compared to 2069/70.

According to the financial report(unaudited) for the third quarter,

 Net profit = Rs 99.94 crore.

Operating profit = Rs 2.15 arba

Provision = Rs 11.89 crore.
Reduction in performing loan = 0.52 percent

Deposits= Rs 42.95 arba
Loan = Rs 27.01 arba


 EPS =  Rs 65.27

Net worth per share= Rs 274.50

P/E ratio =27.85 times

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