Global Investing Roundups

March 11, 2008

By Investment News Staff, Contributing Writer, Money Morning

China Inflation Hits 12-Year High; Weak Dollar Drives Export Growth; EU Clears DoubleClick Takeover; Egyptian Telecom Up 180%; SWFs to Surpass Central Banks; WellPoint Plunges; Audi Shifts Into High Gear; MS Head of Trading Out

  • China's inflation rate continued to accelerate in February, as the nation's consumer price index (CPI) was up 8.7% from the year before the National Bureau of Statistics (NBS) said on Tuesday. That's the biggest jump in nearly 12 years and follows a 7.1% rise in January. Producer prices rose 6.6% in February. Since early 2007, China has hiked its interest rates six times to try and cool inflationary pressures, but rising commodity and food prices have undermined the government's efforts.

  • The U.S. trade deficit grew 0.6% in January, less than expected, as a weak dollar boosted exports, even as oil imports jumped to a record high. The gap expanded to $58.2 billion from a revised $57.9 billion in December, the Commerce Department said yesterday (Tuesday). Exports climbed to a record $148.2 billion and imports jumped 1.3% to $206.4 billion, also the highest ever.

  • European Union regulators cleared Google Inc.'s (GOOG) $3.1 billion bid for online ad tracker DoubleClick yesterday (Tuesday), saying the acquisition would not adversely affect competition for online ads, the Associated Press reported. The U.S. Department of Justice signed off on the deal in December, meaning Google has cleared its last major hurdle before acquiring DoubleClick.

  • Egyptian mobile phone company, Orascom Telecom, reported net income increased 180% yesterday (Tuesday) to just over $2 billion for full year 2007 with 70 million subscribers. Reuters reported the company said that in 2008 the markets in which it operates "will continue to grow rapidly due to their sustained economic growth, low mobile penetration rate, limited fixed-line coverage, and the relatively high cost of fixed-line infrastructure deployment."

  • Sovereign wealth fund assets could surpass total central bank foreign reserves according to a Morgan Stanley (MS) economist. "The rate of growth is impressive. We are talking here of about $1 trillion per year in their asset pool, generated mainly by a boom in oil prices and other commodities," Morgan Stanley Managing Director Morgan Jen said in a conference call yesterday (Tuesday), Reuters reported.

  • Indianapolis-based insurance carrier WellPoint Inc. (WLP) cut its profit forecast yesterday (Tuesday) causing shares to tumble. "We are making these revisions to our prior earnings guidance due to higher than expected medical costs, lower than expected fully insured enrollment and, to a lesser extent, the changing economic environment in which we are operating," Chief Executive Angela F. Braly said, MarketWatch reported. Shares dropped $18.66, a 28% decline, to close at $47.26.

  • Audi AG, Volkswagen AG's (OTC: VLKPY) luxury-car division, said yesterday (Tuesday) that 2007 profit rose to a record on demand for the A5 Coupe and TT Roadster and that a new version of its best-selling model will help sales and earnings increase further in 2008. Net income increased to $2.6 billion (1.69 billion euros) from $2.1 billion (1.34 billion euros), the Ingolstadt, Germany-based carmaker said in a statement. Revenue gained 7.9% to $51.5 billion (33.6 billion euros). Audi plans to overcome "major challenges" in 2008, such as slower U.S. economic growth, the declining dollar and rising raw material prices, by introducing new models to boost sales, Bloomberg reported.

  • Morgan Stanley's (MS) former head of trading, Neal Shear, has opted to "leave the firm to pursue other activities," Bloomberg News reported. Chief Executive Officer John Mack demoted Shear in November after the firm reported record subprime-related losses. As head of trading, Shear earned $35 million in 2006, making him the second highest paid Morgan Stanley employee. He had been with Morgan Stanley for 25 years.