RBS share drop accelerates on stress test flop

Stressed. Shares in Royal Bank of Scotland have accelerated their losses this morning, falling over 4.5 per cent after the state-backed lender came in bottom of the heap in the Bank of England’s latest stress tests. RBS failed the toughest ever stress tests carried out by the BoE, with results this morning showing the lender’s […]

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Renminbi strengthens further despite gains by dollar

The renminbi on track for a fourth day of firming against the dollar on Wednesday after China’s central bank once again pushed the currency’s trading band (marginally) stronger. The onshore exchange rate (CNY) for the reniminbi was 0.28 per cent stronger at Rmb6.8855 in afternoon trade, bringing it 0.53 per cent firmer since it last […]

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Sales in Rocket Internet’s portfolio companies rise 30%

Revenues at Rocket Internet rose strongly at its portfolio companies in the first nine months of the year as the German tech group said it was making strides on the “path towards profitability”. Sales at its main companies increased 30.6 per cent to €1.58bn while losses narrowed. Rocket said the adjusted margin for earnings before […]

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Spanish construction rebuilds after market collapse

Property developer Olivier Crambade founded Therus Invest in Madrid in 2004 to build offices and retail space. For five years business went quite well, and Therus developed and sold more than €300m of properties. Then Spain’s economy imploded, taking property with it, and Mr Crambade spent six years tending to Dhamma Energy, a solar energy […]

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Nomura rounds up markets’ biggest misses in 2016

Forecasting markets a year in advance is never easy, but with “year-ahead investment themes” season well underway, Nomura has provided a handy reminder of quite how difficult it is, with an overview of markets’ biggest hits and misses (OK, mostly misses) from the start of 2016. The biggest miss among analysts, according to Nomura’s Sam […]

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Archive | November, 2016

FCA chief says zombie probe ‘not finest hour’

Posted on 31 March 2014 by

Martin Wheatley, CEO of the FSA, photographed at their office in Canary Wharf today.©Charlie Bibby

Martin Wheatley, head of the FCA

The UK’s chief financial watchdog admitted his organisation faces serious questions after confusing reports about a new insurance inquiry led to “extreme movements” of more than 20 per cent in some sector share prices last week.

Martin Wheatley, chief executive of the Financial Conduct Authority
, said the organisation’s handling of its plans to examine zombie insurance funds was “not the FCA’s finest hour”.

    The regulator’s board has already ordered an independent probe of the episode and Mr Wheatley said that as CEO he expected to be personally affected by the inquiry.

    The gyrating share prices caused by the zombie inquiry reports have also triggered concern elsewhere in government, with one Treasury official on Monday describing them as “extremely serious,” adding “clearly we need to get to the bottom of what happened”.

    Andrew Tyrie, chair of the Treasury select committee, has said the episode was an “extraordinary blunder”.

    The FCA provoked fury among insurers and investors on Friday because it waited for six hours after the stock market opened to make clear that the scope of the probe was much narrower than originally reported in the Daily Telegraph. The initial report sparked fears of a wide-ranging investigation into 30m policies and led to hundreds of millions of pounds being wiped off the sector’s market capitalisation.

    The FCA later said it did not plan to review all those individual policies or retrospectively impose current standards on old contracts. Its board then called in external lawyers to look at its actions.

    Mr Wheatley said on Monday that he took responsibility for what happened in his organisation.

    He said: “Whenever markets move as they did on Friday, scrutiny rightly follows, and it is no different for the FCA as for any other firm. If firms were involved in events like this, like those we saw prior to the weekend, we would ask serious questions. It is now incumbent on us to answer the same questions.”

    Lombard: FCA boss should stay on

    Jonathan Guthrie

    FCA boss Martin Wheatley is rocking back on his heels but he has not yet passed the tests for a private sector chief executive to step down, writes Jonathan Guthrie.

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    The insurance probe was one element of the FCA’s business plan, which was published in full on Monday morning. In the document, the FCA proposed a 2014/5 budget of £452m, up 1 per cent from the previous year. It also made a special funding request of £41m to cover its new responsibilities for overseeing consumer credit.

    The watchdog warned that the growth of consumer credit may pave the way for “unaffordable debt” in the UK and vowed to scrutinise areas including credit card lending, overdrafts, payday lending and debt management advice.

    The FCA this year takes on powers to oversee 50,000 consumer credit providers for the first time – doubling the number of firms it regulates.

    The UK household debt-to-income ratio has fallen to under 140 per cent from a peak of 170 per cent, but the FCA warned that further debt accumulation would leave households vulnerable to “interest rate changes, incomes shocks and changes to credit conditions.”

    The watchdog also said it was planning to shine a spotlight on how investment banks handle flows of confidential information within their own organisations, as well as how they manage conflicts of interest and curb the scope for traders to manipulate prices and benchmarks.

    Investors re-engage with emerging markets

    Posted on 31 March 2014 by

    Global investors are more willing to engage in emerging markets than at any time since the sell-off of last summer, according to research by Morgan Stanley – whose analysts coined the term “fragile five” to describe the most vulnerable countries.

    Despite mounting evidence of a slowdown in China, tensions over Ukraine and tense election campaigns in several countries, the currencies previously seen as most exposed to the US Federal Reserve’s tapering have rallied in recent weeks.

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      Evidence of economic rebalancing and hopes that elections will usher in reform-minded governments have sent Indonesia’s rupiah up more than 7 per cent against the dollar since the start of the year. India’s rupee is up 3.2 per cent and Brazil’s real has gained 3.9 per cent. The Turkish lira and South African rand – grouped with them in the “fragile five” – have also rallied since interest rate hikes in both countries, and low volatility across currency markets, tempted investors back into carry trades.

      The Institute of International Finance, which has just begun publishing estimates of portfolio flows to emerging markets, said last week that the 30 countries it tracks had received inflows of $39bn in March, up from $25bn in February and $5bn in January.

      The shift in sentiment “has some fundamental support in the near term”, according to Manoj Pradhan, a senior economist at Morgan Stanley, given hopes of stimulus from Chinese policy makers, the receding threat of sanctions against Russia and signs that investors are taking tapering in their stride for now.

      The bank’s assessment is striking, because Morgan Stanley has been consistently bearish on emerging markets for much of the last year – and still warns investors against mistaking this near-term stabilisation for a longer-term turnround.

      Some are more bullish. Analysts at Commerzbank last week gave an upbeat outlook for emerging market local currency bonds, arguing that investors had had time both to digest the Fed’s plans and to price in the political risks in many emerging markets.

      Other analysts urge greater caution. “External vulnerabilities are still out there,” warned strategists at Citigroup. “The recovery in capital flows could be a temporary phenomenon, ahead of a more dramatic move in US rates over the next quarters.”

      “Emerging markets are experiencing what can be termed a ‘capitulation of bears’,” wrote strategists at BNP Paribas, who advised betting against further price rises.

      Matthew Cobon, head of currency at Threadneedle Investment, voiced a similar view, saying the recent rallies chiefly reflected an unwinding of short positions.

      Mr Pradhan said that mainstream investors who had previously withdrawn from emerging markets had now become the most enthusiastic about their prospects, while EM-dedicated funds were more tentative. “It seems likely to us that many investors feel they cannot remain on the sidelines,” he said.

      New markets provide shot in the Arm

      Posted on 31 March 2014 by

      Hopes of a turn of fortunes put Arm Holdings among the FTSE 100’s biggest gainers.

      Having started 2014 at a record high, the chip designer slipped 10 per cent over the first quarter as slowing smartphone sales put its expected royalty revenue under pressure.

        Downgrades now look to have run their course, according to Barclays, with handset shipment forecasts falling to “very achievable levels” and data from the supply chain improving.

        With momentum on the turn, news on Arm’s entry into the networking and server markets should lift longer term forecasts, the broker said. Arm closed 2.1 per cent higher at 998p.

        “The combination of reasonable growth in mobile and very strong double-digit growth in these new markets supports our view of Arm growing revenue at circa 20 per cent for the next five years,” said Barclays.

        It added that, with Arm’s cash pile set to grow beyond its operational needs, the prospect of improved shareholder returns made a valuation of 30 times 2015 earnings “very attractive”.

        The first quarter ended with a whimper, leaving the FTSE 100 down 0.3 per cent, or 17.21 points, to 6,598.37. For the quarter, the index lost 2.2 per cent.

        Babcock International led Monday’s blue-chip risers, up 4.3 per cent to £13.47, after its consortium was named preferred bidder for a £7bn contract to decommission Magnox nuclear reactors.

        JPMorgan Cazenove saw the deal as worth £196m in annual sales over the next 14 years which, on a profit margin of about 9 per cent, would boost Babcock’s operating earnings by 5 per cent.

        Vodafone ended 0.5 per cent higher at 220.3p, though it was well off its session high, after its long-rumoured predator AT&T pledged cash towards buying back 300m shares.

        The US group also said to expect its net debt to remain below 1.8 times operating earnings.

        Drugmaker Shire lost 2.5 per cent to £29.45 in delayed response to a US Court of Appeals defeat on Friday that ordered a retrial of a ruling that had stopped Actavis from making versions of Shire’s bowel disease pill.

        Citigroup saw a settlement with Activis as likely, at a cost of about 6 per cent of Shire’s 2016 earnings.

        Evraz led the metals companies, up 10.6 per cent to 79.7p.

        Credit Suisse, which put a 100p target on the Russian steelmaker, said the weak rouble and cost-cutting should mean Evraz could cope with its debt burden even though its domestic market would be oversupplied for the next two years.

        Songbird Estates, the owner of London’s Canary Wharf development, climbed 12.9 per cent to 250p after just over 400,000 shares changed hands at 257.5p apiece.

        The thinly traded shares have jumped 30 per cent since Songbird last week reported its highest occupancy rates since the financial crisis.

        Iraq explorer Gulf Keystone Petroleum lost 12.4 per cent to 86.3p after it was targeted by prominent short sellers, who argued that the group would need a cash call if a planned bond issue failed.

        Gadget refurbishment group Regenersis jumped 10.4 per cent to 395p after announcing the €60m acquisition of Blancco, a Finnish data erasure specialist.

        The purchase, which was funded via a £100m share placing at 345p apiece, was ahead of European legislation due to come into force next year that will fine companies breaching data security up to 5 per cent of their global turnover.

        Stocks closing week on firmer footing

        Posted on 28 March 2014 by

        Friday 08:15 GMT. Markets are ending the week in a generally upbeat mood with global stocks gaining for a fourth day in a row and industrial commodities attracting buyers.

        Optimism over the US and China’s economies, coupled with waning concerns surrounding the Crimea crisis, are helping underpin sentiment. Hopes that the European Central Bank may take action to stimulate the eurozone may also be providing support to risk appetite.

          The FTSE All-World equity index is adding 0.3 per cent, recovering from a dip on Monday to advance 1 per cent over the subsequent sessions. On Friday, the FTSE Eurofirst 300 is up 0.5 per cent after its Asia-Pacific peer rose 0.8 per cent.

          US index futures suggest the S&P 500 will add 3 points to 1,852 when the opening bell rings later in the day, partially recovering from a second successive decline on Thursday that left the benchmark 1.5 per cent below its record high of 1,878 hit on March 7.

          Wall Street, which usually sets the tone for global developed markets, has been struggling to make further headway of late, the S&P 500 trapped within a roughly 40 point range for the past five weeks.

          Short-term US borrowing costs are moving higher as investors contemplate an improving economy, encouraging the Federal Reserve next year to raise interest rates for the first time since the financial crisis began seven years ago.

          Two-year Treasury yields have trundled up to 0.45 per cent in response, a move that contrasts with the trend in Europe, where equivalent duration Bunds are yielding just 0.13 per cent.

          That leaves the US/German 2-year yield spread at 32 basis points, its widest in more than two years, with additional pressure on European yields coming from talk that the ECB is considering introducing quantitative easing in order to boost the bloc’s economy. News of Spanish deflation may make ECB action more likely.

          Such chatter of more central bank largesse may be beneficial for risk assets, but it has just recently been putting pressure on the euro, which on Friday is down another 0.2 per cent to a three-week low of $1.3712.

          It had been thought that as US borrowing costs moved higher, emerging market assets would slump further on worries developing economies would find it harder to attract funds.

          But investors have not become more risk averse. On the contrary, the FTSE Emerging Market index is up another 0.7 per cent on Friday, a sixth consecutive session of gains that has seen the gauge advance 4.3 per cent.

          The Indian stockmarket’s move to record highs, on hopes for a more business-friendly government, has helped the EM mood. As has a partial rebound for Russian equities as investors bet that the spat between the international community and Russia over Crimea will not intensify. Moscow’s Micex index is up 0.6 per cent, though it should be noted the rouble and the country’s bonds are softer on the day.

          But EM assets are also highly sensitive to perceptions of China’s economic prospects, so they will have welcomed comments this week from premier Li Keqiang that Beijing is ready to take measures to support the cooling economy.

          Hong Kong’s Hang Seng index rose 1 per cent, putting it on track for a weekly advance of nearly 3 per cent. Shares of companies based in China have led gains, moving up more than 6 per cent this week on hopes of a stimulus from Beijing.

          The Shanghai Composite eased back 0.2 per cent on Friday, but China-sensitive industrial commodities were more chipper, with copper leading broad gains for the metals, up 0.8 per cent to $6,617 a tonne.

          In Tokyo, investors were looking past less than optimistic data on retail sales and household spending. The Nikkei 225 rose 0.5 per cent, and has gained 3 per cent this week.

          Japanese retail sales climbed 3.6 per cent from a year ago in February, down from January’s 4.4 per cent rise, indicating a slowing in consumers’ rush to make big purchases ahead of a rise in the sales tax on April 1.

          “Unfavourable snow conditions in the middle of the month look primarily responsible for weak consumer spending on clothing and eating out,” wrote analysts at Credit Suisse.

          In currencies, the Australian dollar was trekking toward the US$0.93 barrier, climbing 0.1 per cent – a sixth straight daily gain – to US$0.9266.

          Since late January, the Aussie has gained about 7 per cent and “looks unlikely to slow down”, noted Evan Lucas, IG strategist, as the country’s central bank governor is no longer talking down the currency.

          Gold is up $5 to $1,296 an ounce

          Additional reporting by Patrick McGee in Hong Kong

          Big banks face tax rise under levy reform

          Posted on 27 March 2014 by

          City of London©Getty

          The biggest banks could face higher tax bills under government plans to reform the bank levy, published in a consultation paper on Thursday.

          The tax, branded “a location levy” by British lenders, is levied as a percentage of their total global liabilities. Foreign banks also contribute, but pay only a percentage of their UK liabilities.

            Since its introduction in 2011, the levy has raised £5bn for the taxpayer.

            The Treasury paper said it was considering a redesign of the charging mechanism for the levy to put lenders into different bands according to their size, rather than setting the tax for each bank separately each year.

            The consultation document includes five “illustrative models”, in which the banks in the top bands would face tax charges ranging from £569.8m to £782.4m each.

            If the Treasury’s final decision for reform falls in the middle of these two figures, it would represent a tax increase of more than a fifth for HSBC, which was the highest contributor to the bank levy last year, paying $916m (£551m) – up by a third from the previous year. Barclays was the second-highest contributor at £504m.

            The British Bankers’ Association has complained about eight consecutive increases in the bank levy. This was “inconsistent with the government’s desire for Britain to have a competitive, stable and predictable tax regime”.

            Few other countries had a levy at all, damaging the UK’s position, it added in a submission to the Treasury.

            The BBA said on Thursday: “We will use the consultation period to work through the details to ensure that the redesign meets the objectives set for the review.”

            MBIA: new wrapping

            Posted on 26 March 2014 by

            Does time heal all wounds? A half-decade after MBIA and fellow bond insurers rocked the US municipal bond market after buckling under risky mortgage debt that they had also guaranteed, MBIA is poised to start insuring “munis” anew. Standard & Poor’s recently raised its rating on MBIA’s US muni insurance arm, National Public Finance Guarantee, to double A minus from single A, enabling it to charge enough in premiums to make substantial new business worthwhile. It has done a handful of new deals of late. MBIA has made big strides cleaning up its mortgage mess and split the troubled structured finance business from the healthy muni one. But will the muni market embrace insurance again?

              Pre-crisis, 50 to 60 per cent of muni bond issuance was insured – and some investors simply outsourced the credit work. Last year, the share was 3.2 per cent, according to Municipal Market Advisors. There were nine active insurers in 2007, versus just Assured Guaranty and new entry, Build America Mutual, in 2013 after most insurers collapsed.

              There are other impediments. With interest rates low, investors have valued the yield that comes with risk more than the safety of insurance. After insurers’ disastrous turn in the crisis, many investors have been less inclined to trust the insurance enough to forgo their own analysis of the issuer. For those doing that work, there is little point to buying bond insurance.

              As rates rise, the economics of bond insurance make more sense. And distressed situations such as Detroit and Puerto Rico may remind investors of the value of insurance, though they will simultaneously test the model – both MBIA and Assured have about $5bn of exposure to Puerto Rico. Bond insurance is likely to become more popular. But it is unlikely to regain the dominance it once had. That is a relic of the past.

              Email the Lex team in confidence at

              How to make a fortune in value investing

              Posted on 26 March 2014 by

              Fortune favours the brave. And everything comes to he who waits. In these two well-worn phrases lie differing justifications for two different approaches to value investing. Both have merit, but the trick is to combine them.

              Value investing has been popular ever since it was promulgated by US academic Benjamin Graham in the 1930s. His idea was that many companies had grown so cheap in the wake of the Great Crash and the subsequent economic depression that it was possible to buy them for less than their intrinsic value.

                It received a separate and very different impetus in the 1970s, when a vast research project by two more academics, Eugene Fama and Kenneth French, showed that over time, cheap stocks – which they measured by price-to-book ratio – did indeed outperform. They labelled this the “value” effect.

                These approaches are different. But there is also an academic debate over how to explain the Fama and French findings which leads, in turn, to two different kinds of “value” investing. Mr Fama himself, who was made a Nobel economics laureate last year, explains the value premium in terms of risk. Cheap stocks are generally cheap because they are in bad shape and face big risks. Therefore a value effect over time is just what would be expected in an efficient market – higher risk is related to higher long-term returns.

                A second explanation comes from behavioural finance, and suggests that markets are inefficient. As humans we get excited about stocks with a great story to tell, and tend to ignore the more humdrum boring stocks that plug away producing predictable profits and dividends. Buying such stocks is a way of taking advantage of inefficiency and in the long run it will pay off. Both approaches are about “value”, but they are different.

                Brave and patient approach

                The effort is now on to systematise both strategies. Société Générale’s Andrew Lapthorne labels the approaches “brave” and “patient” value, and has a strategy for each. The patient approach involves buying stocks with strong balance sheets and regular dividend yields. This strategy is also called “quality income” and will work well in the long run. The disadvantage is that stolid dividend-payers tend to underperform in a strong bull market, as we have had for five years.

                The “brave” approach involves buying the 200 cheapest stocks, relative to their own sectors, in the developed world. This compensates for the fact that some sectors will naturally look “cheaper” on basic metrics than others, and uses a weighted combination of five value measures – price/earnings, forward price/earnings and price/book multiples as well as, for non-financial companies only, free cash flow to price, and earnings before interest, tax, depreciation and amortisation to enterprise value. These companies are reshuffled every quarter, so the index will not ride for long with its “winners” whose share price takes off. It is now available as the SG Value Beta index.

                Tying to it might make it a little easier psychologically to do the things that deep value investors need to do, such as buy shares in BP while its oil was still pumping into the Gulf of Mexico.

                As Mr Lapthorne points out, the two strategies prove to be remarkably complementary. The “brave” value index has a high “beta”, meaning that its fate is linked to the market. It outperforms in good times, and will suffer far greater falls in a downturn. Its ultimate gains come from a rising share price. Meanwhile, “patient” value is less correlated to the market, and delivers its returns by compounding dividends in the long term.

                Over the last 20 years, patient value returned 11.9 per cent per year, while brave value gained 14.3 per cent per year, with far higher volatility. In combination they returned 13.4 per cent per year, with lower volatility than that achieved by an equal-weighted market index, which returned a compound 8.4 per cent per year. Wherever the returns from value come from, they mount up in the long run.

                Shortage of value stocks

                This is far removed from the original Graham approach of buying stocks so cheap that they virtually pay for themselves. But sometimes there are few such stocks. By Mr Lapthorne’s own screen, using Graham criteria, barely more than 20 stocks in the MSCI World index now qualify. These do include intriguing names like Intel, BHP Billiton and Vodafone, along with a raft of large Japanese groups, and there is always the option of staying in cash if stocks look too expensive – but it does suggest limitations to the original Graham approach.

                And maybe the later Graham would approve. In the 1950s, in retirement, he said he was “no longer an advocate of elaborate techniques of security analysis to find superior value opportunities”. He proposed a screen based only on historic p/e, the AAA-rated corporate bond yield, and a test of balance sheet strength.

                This, he said, “seems to be practically a foolproof way of getting good results out of common stock investment with a minimum of work”. That could be a good description for the value screens of today.

                Rand gains from calmer EM waters

                Posted on 26 March 2014 by

                  The South African Reserve Bank on Thursday will deliver its latest monetary policy decision.

                  Analysts’ consensus is for the SARB to leave rates alone after unexpectedly hiking them by 50 basis points to 5.5 per cent in January, ostensibly to support the rand.

                  Still, Capital Economics describes the outcome as a close call.

                  “A renewed slump in the currency before the meeting could prompt another rate hike but, as things stand, we think the SARB will refrain from raising rates this time around,” says the London-based research boutique.

                  After being caught up in the emerging market fallout at the start of the year, with domestic industrial relations strife adding to the tension, the rand seems to have steadied for the time being, gaining 5 per cent or so since the SARB’s January tightening.

                  Chart: South African rand against the dollar

                  And it is worth noting that EM currencies generally have not displayed the kind of sensitivity many would have expected to last week’s shift in short-term US rate expectations following the “Yellen wobble”.

                  The rand’s one-month implied volatility is near 13, below the 12-month average of 14.3 and well down from the spike above 18 seen at the end of January.

                  Calmer times in EM forex?


                  Stocks firm on US economic hopes

                  Posted on 26 March 2014 by

                  Wednesday 08:00 GMT. Optimism over the US economy, the prospect of further easing by the European Central Bank and waning market tensions regarding the Crimea crisis are helping European stocks open at two-week highs following a sturdy Asian session.

                  The positive mood sees industrial commodities gain ground and reduced demand for supposed havens such as Treasuries. Gold, which dropped to a one-month low on Tuesday, is up $5 to $1,315 an ounce even as the dollar index rises 0.1 per cent to 80.02.

                    The FTSE Eurofirst 300 is up 0.3 per cent after its Asia-Pacific peer rallied 1 per cent and as US index futures show the S&P 500 adding 3 points to 1,868.

                    That would leave the New York benchmark just 10 points below its record high. Stocks have perked up again with Wall Street’s “animal spirits” exhibited in another large acquisition by Facebook and the launch of game developer King’s IPO.

                    News that US consumer confidence is at a six-year high has boosted hopes for the world’s biggest economy, allowing investors to shrug off a smaller than expected rise in the S&P Case-Shiller house price index, which was again blamed on the harsh weather.

                    “A particularly cold winter and the impact of the recent rise in mortgage rates from near-record lows continue to restrain the sector, though hope remains for a notable recovery during the typically busy spring buying season,” wrote Gennadiy Goldberg, TD Securities economist.

                    US interest rates continue to nudge higher, the 10-year yield adding 1 basis point to 2.75 per cent and the more policy-sensitive 2-year note up 3bp to 0.46 per cent.

                    That takes the short-term yield to within just several basis points of its highest since May 2011 as the market pulls forward expectations for when the Federal Reserve may begin tightening policy.

                    In contrast, German 2-year yields are fractionally softer on the day. At just 0.18 per cent, they reflect the prospect of further policy easing in the eurozone after Jens Weidmann, head of Germany’s powerful Bundesbank, signalled he would support government bond buying under certain circumstances.

                    The possibility of even looser ECB policy may be underpinning European stocks but it seems to be weighing on the single currency, which is down 0.2 per cent to $1.3810.

                    Also helping sentiment in “risk assets” is the apparent decline in investor angst over the Crimea/Ukraine crisis. The Moscow stock market is up 1.1 per cent and the rouble is firmer by 0.2 per cent against the dollar to Rbs35.14.

                    The market’s generally more upbeat mood sees money move into commodities, with copper up 0.5 per cent to $6,608 a tonne and Brent crude adding 11 cents to $107.10 a barrel.

                    In Australia, the central bank signalled concern that some lenders are attempting to boost profit growth by easing standards for property loans – highlighting a trend towards loose credit conditions across different assets that is concerning regulators globally.

                    In its semi-annual Financial Stability Review, the Reserve Bank of Australia acknowledged that one effect of its loose monetary policy has been to spur housing demand and lift property prices. It is important that banks do not respond to this dynamic by encouraging speculative activity, the RBA said.

                    Sydney’s stocks were unfussed, with strength in miners helping the S&P/ASX 200 rise 0.8 per cent. The Aussie dollar is up 0.3 per cent to US$0.9190 – near levels that the RBA characterised as “uncomfortably high” in December, noted Adam Cole, head of G10 FX strategy at RBC Capital Markets.

                    A softer yen helped the Nikkei 225 in Tokyo rise 0.7 per cent, matching the gain for Hong Kong’s Hang Seng. Shanghai dipped 0.2 per cent after rising 3.7 per cent in the previous three sessions on hopes for more stimulus from Beijing.

                    Additional reporting by Patrick McGee in Hong Kong

                    No more waving at waiters for the bill

                    Posted on 26 March 2014 by


                    The exaggerated writing gesture used by restaurant diners to get a waiter’s attention is a hand signal understood almost everywhere in the world. There is a reason for this recognition: no one enjoys hanging around to settle their food bill.

                    Help is on its way, however, in the form of a couple of smartphone app businesses.

                    London-based Flypay launched its service this month in mid-market UK restaurant chains Wahaca and Burrito Mama, having secured a £1m investment from private equity firm Entrée Capital.

                    Diners either scan or enter a Flypay code to receive an itemised bill on their smartphone. Once payment has been made, using debit or credit cards, the app notifies the restaurant, leaving the diners free to leave, and saving the waiting staff the bother of bringing over chip-and-pin terminals.

                      A similar service is offered by MyCheck, which operates in Tel Aviv, London and New York, and has raised $6.1m since it was founded in 2011. MyCheck is the largest mobile payment company in Israel, with more than 100,000 direct subscribers and more than 1m indirect users through its partnership with Pango, the country’s nationwide electronic parking payment provider and Isracard (MasterCard Israel).

                      More than 400 merchants in Israel accept MyCheck, which allows users to pay for petrol, parking, taxis and hotels as well as settle restaurant bills.

                      Flypay’s app may be more limited in its scope but it claims to make the bill payment process more efficient. For instance, unlike MyCheck, Flypay does not require a four-digit pin to be handed to a waiter. Whichever system cracks it, eating out is unlikely to be the same again. The only worry left for diners will be how to split the bill.