News Archive


U.S. top court considers patent protections for software


WASHINGTON (Reuters) – Supreme Court justices gave little indication on Monday they would set new guidelines on patent eligibility of software.

From their questions during an hour-long oral argument, the court appeared likely to rule for CLS Bank International by saying Alice Corp Pty Ltd patents for a computer system that facilitates financial transactions were not patent eligible.

Although some of the nine justices signaled a willingness to set a test that would describe exactly what types of computer-implemented inventions were patent eligible, others suggested there was no need for a broader ruling. A decision is expected by the end of June.

(Reporting by Lawrence Hurley; Editing by Howard Goller)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/GC19Atsszcg/story01.htm

National resource giants plot varied paths to global goal


NEW YORK (Reuters) – In teaming up with Cargill to create the world’s largest sugar trader last week, Brazil’s Copersucar has joined a small but growing club of national resource champions steadily transforming the commodities landscape.

In the boldest international move in its 50-plus-year history, the world’s top sugar producer will form a 50-50 joint venture with global trading powerhouse Cargill, plugging its 47 sugar mills into one of the world’s biggest logistical operations, with customers stretching from Chicago to China.

It was a blockbuster deal for the global sugar market, but perhaps even more importantly it opened up a new path for other state-owned or nationally powerful commodity producers, those with domestic strongholds and international ambitions.

From Russia to China, Brazil to Saudi Arabia, national giants are going global at an accelerating pace, eager to squeeze more profit from the lucrative global commodities supply chain – a trend that, until now, threatened to crowd out the global merchants who have long dominated international trade.

Some are simply buying what they want, such as Russian oil firm Rosneft’s purchase of Morgan Stanley’s (MS.N) physical oil business; others like PetroChina (601857.SS), which has been looking to hire traders in Houston, are building it organically.

They are racing in amid once-a-generation reshuffling of commodity industry investors, with many global banks bailing out of the market due to regulatory pressure. The grab for market share could last for years, experts say.

“It’s a game of musical chairs and the seats are getting much more valuable,” said Chip Register, a long-time commodity executive, currently at Sapient Global Markets.

“For anyone who’s got the capital and the interest, it’s a land grab.”

SAME AIM, DIFFERENT ROUTES

While the aim is the same, the routes to success vary and in just the past three months, companies have several different approaches: buy a business wholesale, secure strategic assets piecemeal, and go it alone with their own shop.

Copersucar, a collective of 47 privately held mills steeped in Brazil’s agricultural roots, has entered uncharted territory by agreeing to a 50-50 joint venture that excludes any physical assets – keeping control over the most strategic parts of its business while leveraging Cargill’s global network.

While similar arrangements are not unusual in other niches of the soft commodity markets, none come close in terms of scale, scope and the half-and-half corporate structure.

The deal arrived just two years after Copersucar launched a global expansion, opening its first offices in Hong Kong and the United States, the world’s two largest consuming markets.

The deal is a lower-risky, lower-cost way to catapult the Brazilian enterprise into the top league of the fiercely competitive sugar trade, avoiding the expense and execution risk of buying a company or hiring expertise, experts said.

But it still presents challenges. Merging resources, in this case mainly traders, can be daunting and throw up cultural issues.

Even so, with geopolitical turmoil, drought and disease roiling global supply chains, traders want to control more of the supply chain from producing and processing the raw material to shipping it to customers around the global.

“(Merchants) won’t want to be subject to someone throwing a monkey wrench into their business,” said Joe O’Neill, an independent consultant on softs trading and former executive at ICE, New York Board of Trade and the New York Cotton Exchange.

OTHER ROUTES

It is far from clear which model will fare best, but the stakes are rising – especially for the global merchants who have long acted as the middlemen between resource-rich domestic giants and global consumers.

“I think the differing approaches stem from their own internal capabilities, whether they have the ability to grow that organically or realize they just have to buy it,” a senior trading executive at a global commodities merchant said.

Over the past month, Chinese trader COFCO Corp CNCOF.UL has made an aggressive grab for two overseas grains operations – as Beijing develops its own global agriculture trading house. It will scoop up a majority stake in Dutch company Nidera and is in talks to buy into Noble Group’s (NOBG.SI) agricultural arm.

Increasing its footprint outside of its home market in the capitally-intensive business may throw up pitfalls for the company even with backing from Beijing.

Foreign companies and newcomers on a market can encounter cultural obstacles. Sempra’s energy traders struggled to settle into being run by JPMorgan Chase Co’s (JPM.N) after the Wall Street bank bought Royal Bank of Scotland commodities business in 2010.

Mistakes are easy as a newcomer too.

“If you’re hiring organically, you need to know what you’re doing. If they’re just relying on someone to run the business without a trading backdrop, the chance of success drops quickly,” said Register.

(Editing by Jonathan Leff, Bernard Orr)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/E7P6uXTTz-4/story01.htm

Japan factory output contracts, dims growth outlook as tax hike looms


TOKYO (Reuters) – Japan’s factory output unexpectedly fell in February at the fastest pace in eight months, leaving the economy in a precarious position as an impending sales tax hike threatens to choke consumption and undermine the government’s revival plan.

Analysts say that with the national sales tax rising to 8 percent from 5 percent on Tuesday, the Bank of Japan will probably need to inject more stimulus to safeguard a recovery amid a recent loss of momentum.

Ministry of Economy, Trade and Industry (METI) data showed on Tuesday industrial output fell 2.3 percent in February from the previous month, versus a 0.3 percent rise seen by economists in a Reuters poll.

That followed a solid 3.8 percent gain in January, which was driven by brisk production of cars and household appliances.

Manufacturers surveyed by the ministry expect output to rise 0.9 percent in March but decrease 0.6 percent in April, the METI said, shrugging off the weak February reading as a one-off factor due to unusually heavy snow that disrupted factory activity.

Still, analysts said the outlook for the economy remains challenging at best, noting a recent string of soft data and a separate survey on Monday showing manufacturing activity grew at a slower pace in March.

“Companies are curbing production to keep inventories low because they are worried about demand after the sales tax hike,” said Norio Miyagawa, senior economist at Mizuho Securities Research Consulting Co.

“This suggests the economy may not rebound quickly, and the burden may fall on the BOJ as the government has already committed to fiscal stimulus spending.”

Japan’s economy sped past its developed country peers in the first half of last year, spurred by Tokyo’s aggressive fiscal and monetary stimulus, but has since slowed steadily as exports and capital spending lagged.

With the data indicating the benefits of last-minute demand before the tax hike has probably run their course, external demand may need to pick up some of the slack.

“While capital spending is likely to underpin economic activity ahead, external demand, particularly China, poses a risk to the Japanese economy,” said Naoki Iizuka, economist at Citigroup Global Markets Japan.

In China, worries of a sharp slowdown there have stoked speculation Beijing will launch stimulus measures to bolster growth.

BOJ tankan eyed

Analysts are also looking out for the Bank of Japan’s key tankan survey due on Tuesday, which may offer clues on any impacts of the sales tax hike on business sentiment in the three months to March and their outlook in the following quarter.

Sentiment at big firms are expected to improve slightly in the three months to March for a fifth straight quarter but it is seen sliding in the following quarter after the tax hike.

Weaker-than-expected tankan readings could heighten market expectations for the BOJ to embark on further monetary stimulus in the coming months.

Investors are already expecting the central bank to ease policy further by this summer to make good on its pledge of meeting a 2 percent inflation target by around early 2015.

Analysts doubt the inflation target can be met without further stimulus, with core consumer inflation struggling to accelerate from the current annual gain of above 1 percent driven mostly by high energy prices on a weak yen.

UPBEAT ASSESSMENT

The METI data showed auto makers, manufacturers of mobile phones, personal computers and heavy machinery led declines in industrial production.

The METI stuck to its assessment that industrial output is picking up, and in a press briefing noted that the weakness in February was largely a one-off event due to adverse weather that disrupted factory operations and distribution networks.

The level of production remains high above last year’s peak of 100.1 hit in December and it is expected to maintain the current levels in the coming months, they said.

A survey of manufacturing released earlier in the day also showed weather-related impacts. The Markit/JMMA Japan Manufacturing Purchasing Managers Index (PMI) fell to a seasonally adjusted 53.9 in March from 55.5 in February, keeping above the 50 threshold that separates expansion from contraction for a 13th consecutive month.

Analysts believe factory output is maintaining a rising trend, underpinned by firm domestic conditions and a pickup in external demand.

Still, while a consumption-boost is expected to support growth in the current quarter, the economy is seen contracting in the April-June quarter as consumer spending dips after the sales tax hike.

Many analysts are counting on the BOJ to keep the economy on an even keel, and an expected rebound in the third quarter looks increasingly dependent on the central bank’s largesse.

“I’m closely watching how production will fare in April and May after the sales tax hike. Bleak figures would boost expectations for further monetary stimulus by the Bank of Japan,” Citigroup’s Iizuka said.

(Reporting by Tetsushi Kajimoto; Editing by Shri Navaratnam)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/5XXuYOQUZgs/story01.htm

Alibaba invests $692 million in Chinese department store operator


HONG KONG (Reuters) – China’s Alibaba Group Holding Ltd agreed to invest $692 million in a Chinese department store operator as the e-commerce giant looks to bring the benefits and convenience of online shopping to customers who visit real bricks-and-mortar stores.

Alibaba, whose businesses will come under investor scrutiny ahead of the group’s planned mega IPO in the United States this year, said it will buy $214 million worth of shares in Hong Kong-listed Intime Retail (Group) Co Ltd.

It also agreed to acquire $478 million of convertible bonds, which would give Alibaba a 26.1 percent stake in the department store operator once the bonds are converted into shares in three years.

In recent months Alibaba has gone on a shopping spree, spending more than $2.7 billion to expand into media, chat services and mapping technology.

The expansion has encroached on the turf of social networking giant Tencent Holdings Ltd, which has in turn made inroads into Alibaba’s territory with its partnership with China’s No.2 online retailer JD.com.

The purchases come as Alibaba starts its preparations for an initial public offering set to be the biggest-ever technology listing, surpassing Facebook Inc’s $16 billion listing in 2012.

Intime will issue 220.54 million shares at HK$7.5335 each and HK$3.71 billion worth of convertible bonds to a unit of Alibaba, the department store operator said in a filing to the Hong Kong stock exchange on Monday.

As part of the investment, Alibaba and Intime will form a joint venture to develop online-to-offline, or O2O, business in shopping malls, department stores and supermarkets in China. Alibaba will own about 80 percent of the venture, with Intime controlling the rest.

O2O businesses seek to benefit from the meteoric rise of smartphone use in China and can help turn a search into a shopping trip or meal based on the user’s location.

Shares in Intime surged as much as 17 percent shortly after the market open on Monday, following a trend of Hong Kong-listed companies whose shares gained sharply after receiving investments from Alibaba.

The gains were short-lived, with Intime reversing course and losing as much as 11.4 percent by mid-morning as investors digested details of the purchase, in which Alibaba offered to buy the stock at a 13.7 percent discount to its last traded price on March 26.

Appliance maker Haier Electronics Group Ltd soared 20 percent in December after Alibaba unveiled plans to invest $361 million.

ChinaVision Media Group more than tripled earlier in March after Alibaba agreed to buy a controlling stake for $804 million to gain access to TV and movie content. ($1 = 7.7573 Hong Kong Dollars)

(Additional reporting by Donny Kwok and Paul Carsten in Beijing; Editing by Christopher Cushing and Ryan Woo)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/-trIfEnGhHs/story01.htm

Mitsubishi Motors buys ex-Ford plant in Philippines in SE Asia growth push


TOKYO (Reuters) – Japan’s Mitsubishi Motors Corp (7211.T) said it has bought the site of a former auto plant in the Philippines from Ford Motor Co (F.N), beefing up production as it targets a near-50 percent sales boost in fast-growing Southeast Asia markets.

Mitsubishi Motors, the second-biggest automaker in the Philippines by sales volume after Toyota Motor Corp (7203.T), said on Monday it will centre its Philippines production at the plant in Laguna from January 2015. The plant will have an annual capacity of about 50,000 vehicles, gradually rising to around 100,000 vehicles.

As part of the strategy, the auto maker will close and sell its ageing existing Philippines plant in Rizal, spokeswoman Tomoko Kawabe said. Mitsubishi Motors declined to say how much it paid to buy the Laguna plant, where Ford made sports utility vehicles until December 2012.

The move by Mitsubishi Motors, maker of Triton pickup trucks and Outlander SUVs, adds to growing competition among global car makers in the populous Southeast Asia region, dominated by Toyota and other Japanese car makers.

“We are planning to prepare for future growth in the Philippines, whose auto market is likely to continue grow sustainably,” the company said in a statement.

For second-tier car makers like Mitsubishi Motors and Suzuki Motor Corp (7269.T), Southeast Asia offers a major opportunity as they seek to compensate for shrinking sales in their ageing domestic market. The region now accounts for a quarter of Mitsubishi Motors’ global vehicle sales.

Mitsubishi Motors has a plan to expand regional sales by 44 percent over three years to end-March 2017. In the Philippines it currently makes vehicles including the Lancer EX sedan and the Adventure SUV.

Non-Japanese car makers are also seeking to build up their regional presence. Last year, Volkswagen AG VOW_p.DE set up distribution channels in Philippines, while General Motors (GM.N) has been stepping up its efforts to sell cars in the region including Indonesia.

Shares in Mitsubishi Motors rose 1.9 percent in morning trade to 1,077 yen, outperforming the Nikkei benchmark’s .N225 0.4 percent gain.

(Reporting by Yoko Kubota; Editing by Dominic Lau, Paul Tait and Kenneth Maxwell)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/8PmitGcyJ7A/story01.htm

Asian stocks edge higher on growing hopes of China stimulus


TOKYO (Reuters) – Asian stocks were up slightly in a cautious start to the week on Monday, with investors holding out hopes that China would take steps to stimulate its economy.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS tacked on 0.3 percent after rising to a three-week high on Friday on heightened speculation Beijing will launch new spending measures and on reduced tensions in Ukraine.

Tokyo’s Nikkei stock average .N225 rose 0.4 percent.

China’s Premier Li Keqiang on Friday sought to reassure jittery global investors that Beijing was ready to support the cooling economy, saying the government had the necessary policies in place and would push ahead with infrastructure investment.

China stimulus hopes were unable to shore up all equity markets in Asia, however, with South Korea’s KOSPI .KS11 trading nearly flat.

“It’s difficult for the market to solely move on talks about stimulus with no concrete plan to back them up,” said Kim Yong-goo, an analyst at Samsung Securities in Seoul.

The euro lingered near a one-month low hit against the dollar on Friday after an unexpected drop in Spanish and German inflation bolstered expectations the European Central Bank could further ease monetary policy as early as Thursday.

“It all depends on whether the ECB views the recent slowdown as a temporary pullback or a deeper problem. Given the abundance of policymakers talking about the possibility of negative rates, we believe they are growing more concerned about growth and inflation,” Kathy Lien, managing director at BK Asset Management in New York, wrote in a note to clients.

The euro was already under pressure after suggestions of more ECB action last week from Germany – whose policymakers have in the past repeatedly voiced concerns about unorthodox monetary easing.

The focus now turns to euro zone inflation figures due later in the global session in light of Friday’s weak Spanish and German inflation data.

The euro was little changed at $1.3752 after hitting a one-month low of $1.3704 on Friday.

YELLEN, U.S. DATA EYED

The dollar drew support from a rise in U.S. Treasury yields amid hopes that the Federal Reserve will taper its massive monetary easing and pave the way for an eventual rate hike.

Yields of intermediate-dated Treasury notes neared two-month highs on Friday. The sustained pressure on yields follows comments from Federal Reserve Chair Janet Yellen earlier this month that raised the possibility of rate hikes starting as early as the spring of 2015.

Yellen will speak in Chicago later in the session and the focus is on whether she maintains her stance on rates, which the market has interpreted as hawkish.

Investors will also have a chance to begin gauging whether the frigid winter was really the key cause behind the string of soft U.S. data seen earlier this year, with the March Chicago PMI due later in the session.

The dollar was nearly flat at 102.83 yen, hovering below a two-week peak of 102.98 reached on Friday.

In the commodities markets, gold remained under pressure amid an improvement in risk appetite following upbeat U.S. consumer spending data that brightened prospects for the economy.

Spot gold traded at $1,295.61 an ounce, near a six-week low of $1,285.34 hit on Friday.

Prospects for Chinese stimulus lifted copper, but the metal was still on track to close March with its biggest monthly fall since June as the world’s second-largest economy is still expected to face a slow first quarter. MET/L

Three-month copper on the London Metal Exchange briefly touched a three-week high of $6,680.00 a tonne, but prices are still on track to close the month down about 5 percent.

Simmering tensions between Russia and the West and disruptions to African oil supplies helped U.S. crude trade near a three-week high. O/R

U.S. crude for May delivery edged down 22 cents to $101.45 a barrel after settling on Friday at its highest since March 7.

(Additional reporting by Jungmin Jang in Seoul; Editing by Shri Navaratnam)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/CJY27otonY4/story01.htm

Alibaba to invest $692 million in department store operator Intime Retail


HONG KONG (Reuters) – Intime Retail (Group) Co Ltd said Alibaba Group Holding Ltd would invest HK$5.37 billion ($692.25 million) in the Chinese department store operator and form a joint venture to develop online-to-offline (O2O) business.

Intime will issue 220.54 million shares at HK$7.5335 each and HK$3.71 billion worth of convertible bonds to a unit of Alibaba, the Hong Kong-listed company said in a filing to the stock exchange on Monday.

The pair will form a joint venture to develop shopping malls, department stores and supermarkets related to online-to-offline business in China, Intime said.

(Reporting by Donny Kwok; Editing by Christopher Cushing)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/-trIfEnGhHs/story01.htm

Japan factory output slides, outlook clouded by sales tax hike


TOKYO (Reuters) – Japan’s factory output unexpectedly fell in February at the fastest pace in eight months in a possible sign that the benefits from last-minute demand before an impending sales tax hike may have run their course.

The data adds to growing concerns of a stumble in the economy, and comes on the heels of a separate survey showing manufacturing activity expanded at a slower pace in March.

The Ministry of Economy, Trade and Industry (METI) said industrial output fell 2.3 percent in February from the previous month, compared with a 0.3 percent rise expected by economists in a Reuters poll.

The weak result followed a solid 3.8 percent gain in January, which was driven by brisk production of cars and household appliances.

Manufacturers surveyed by the ministry expect output to rise 0.9 percent in March but decrease 0.6 percent in April, the METI data showed, suggesting a lack of confidence in domestic demand.

The data comes a day before the national sales tax rises to 8 percent from 5 percent on Tuesday.

Analysts are also looking out for the Bank of Japan’s key tankan survey due on Tuesday, which may offer clues on any impacts of the sales tax hike on business sentiment in the three months to March and their outlook in the following quarter.

“Companies are curbing production to keep inventories low because they are worried about demand after the sales tax hike,” said Norio Miyagawa, senior economist at Mizuho Securities Research Consulting Co.

“This suggests the economy may not rebound quickly, and the burden may fall on the BOJ as the government has already committed to fiscal stimulus spending.”

Auto makers, manufacturers of mobile phones, personal computers and heavy machinery led declines in industrial production, the data showed.

Unusually cold weather and snow storms also weighed on output, Miyagawa said.

The METI stuck to its assessment that industrial output is picking up, and in a press briefing noted that the weakness in February was largely a one-off event due to bad weather.

A survey of manufacturing released earlier in the day also showed weather-related impacts. The Markit/JMMA Japan Manufacturing Purchasing Managers Index (PMI) fell to a seasonally adjusted 53.9 in March from 55.5 in February, keeping above the 50 threshold that separates expansion from contraction for a 13th consecutive month.

Analysts believe factory output is maintaining a rising trend, underpinned by firm domestic conditions and a pickup in external demand and reinforcing expectations that the economy can weather the sales tax rise.

Last-minute demand for big-ticket items such as cars and housing has peaked, with growth in housing starts seen decelerating sharply in February.

Still, rising sales of household appliances and non-durables such as foods and clothing before the tax hike are expected to fuel growth in the current quarter, analysts say.

The Japanese economy is expected to contract in the April-June quarter as consumer spending dips after the sales tax hike takes effect, before rebounding in July-September.

(Reporting by Tetsushi Kajimoto; Editing by Shri Navaratnam)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/5XXuYOQUZgs/story01.htm

Mitsubishi Motors to buy a Ford plant in the Philippines: Nikkei


TOKYO (Reuters) – Mitsubishi Motors Corp (7211.T) will buy a car plant from Ford Motor Co (F.N) in the Philippines for around 10 billion to 15 billion yen ($97 million-$145.7 million), the Nikkei newspaper reported on Monday without citing sources.

The newspaper said Mitsubishi Motors is increasingly relying

on Southeast Asia to boost sales.

The plant, where Ford used to build SUVs but stopped operating in 2012, has an annual manufacturing capacity of around 40,000 vehicles, the Nikkei said.

(Reporting by Yoko Kubota; Editing by Dominic Lau and Paul Tait)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/e0k8Ihe2yQA/story01.htm