Li Ka-Shing Rushes Into China Where Bond Angels Fear

(Bloomberg) -- The bond market is telling Li Ka-shing, Asia's richest man, he's sitting on a Chinese property bubble that's bigger than the one deflating in the U.S.

Bonds of China's Agile Property Holdings Ltd. yield 7.17 percentage points more than U.S. Treasuries, double the premium in July and 1.79 percentage points more than the debt of Los Angeles-based KB Home, which has the same credit ratings. Agile, a housing developer in the southern province of Guangdong, and Country Garden Holdings Co., China's most-profitable builder, canceled debt sales in November when borrowing costs climbed.

As China's government attempts to cool property prices with limits on lending, developers are in a land grab. Li, who made his fortune in Hong Kong real estate, Chinese billionaire Xu Rongmao, who owns Shimao Property Holdings Ltd., and hundreds of local developers boosted investment 29 percent in the first eight months of 2007, the National Bureau of Statistics said.

 

Read more at Bloomberg

U.S. Stocks Gain, Led by Technology, Health Care; Pfizer Rises

(Bloomberg) -- U.S. stocks gained after Hewlett- Packard Co. said it won't be hurt by an economic slowdown and Goldman Sachs Group Inc. told clients to buy drug companies.

Hewlett-Packard, the biggest personal computer maker, gained for the first time in nine days after its technology chief said sales of touch-screen products ``far exceeded'' company expectations. Johnson & Johnson, Pfizer Inc. and Merck & Co. rallied after Goldman analysts said some drugmakers will continue to grow earnings even as the economy slows.

 

Read more at Bloomberg

Blu-ray scores victory

(Fin24) - The International Consumer Electronics Show is turning out to be a celebration party for Blu-ray, the high-definition format that Sony Corp backed, and a wake for a rival movie disc technology pushed by Toshiba Corp.

Just two months ago, Sony CEO Howard Stringer said the fight between Blu-ray and Toshiba's HD-DVD was at a "stalemate", and expressed a wish to travel back in time to avert it.

The impasse was broken on Friday by Warner Bros Entertainment, the last major studio to put out movies in both formats. It announced it was ditching HD-DVD, and from May on, would only publish on Blu-ray and traditional DVD.

The decision puts a strong majority of the major studios, five versus two, in the Blu-ray camp.

Asked on Monday at the show if the Warner announcement decides the format war, Stringer said: "I never put up banners that say 'Mission Accomplished."' But his cheerful delivery belied his words.

By contrast, the main media event scheduled for the show by the North American HD-DVD Promotional Group, which includes Intel and Microsoft, was cancelled because of Warner's defection.
 

Read more at Fin24

Schultz back as Starbucks CEO

(Reuters) - Starbucks Corp (SBUX.O: Quote, Profile, Research) replaced CEO Jim Donald with founder and Chairman Howard Schultz and said it would slow an aggressive U.S. expansion in a shake-up that sent its battered shares up nearly 9 percent.

The move marks a return to daily management for Schultz, who is seen as the conscience of the company and warned executives a year ago that Starbucks was losing its way. Schultz, who was chief executive from 1987 to 2000, said Starbucks would close underperforming U.S. outlets and speed up international growth.

Investors have nearly halved the value of the world's biggest coffee chain to $13 billion in the last year in the midst of weakened U.S. sales growth.

"The most serious challenge we face is of our own doing," Schultz said on a conference call. "I am not going to use the economy, with you or our people, as an excuse."

 

Read more at Reuters

Wii trounces PS3, Xbox

(Fin24) - Nintendo's Wii outsold rival Sony's PlayStation 3 three-fold in Japan last year, helping the country's multi-billion dollar video game market to notch up its best ever year, a survey showed on Monday.

Nintendo sold about 3.63 million Wii consoles in its home market in 2007 while Sony sold 1.21 million PS3s, according to magazine publisher Enterbrain.

The Wii also trounced the PS3 more than three-fold in the key year-end sales period between November 25 and December 30, selling 774 123 Wii consoles against Sony's sales of 232 421 PS3s, the survey showed.

Nintendo won back its lead after the two rivals briefly traded places in November, when the PS3 outsold the Wii in Japan for the first time, helped by a price cut and a stronger line-up of games, according to Enterbrain.

Read more at Fin24

Oil drops further away from $100

(Fin24) - Oil prices eased further from the historic 100-dollar-a-barrel level on Monday on fears that energy demand in the United States could be hit by the weakness of the world's biggest economy, traders said.

 

New York's main contract, light sweet crude for delivery in February, fell 51c to $97.40/barrel in electronic deals.

It had struck a record high of $100.09 last Thursday.

On Monday, Brent North Sea crude for February eased 7c to $96.72/barrel. Last week it struck an historic peak of $98.50.

"Prices fall as weak economic data rekindle fears of recessions in the US," Barclays Capital analyst Kevin Norrish wrote in a note to clients.
 

Read more at Fin24

Europe Confidence Falls to Lowest in Almost Two Years

(Bloomberg) -- European economic confidence fell in December to the lowest in almost two years as orders weakened and soaring prices for food and energy pushed up inflation.

An index of executive and consumer sentiment in the euro area slipped to 104.7, the lowest since March 2006, from 104.8 in November, the European Commission in Brussels said today. A separate report showed producer-price inflation accelerated in November to the highest in almost a year.

Expansion in Europe's services and manufacturing industries is slowing and confidence is weakening after oil prices reached a record and the euro gained against the dollar. Still, the European Central Bank has held off cutting its key lending rate as inflation soars, threatening to fuel bigger pay demands.

 

Read more at Bloomberg