Oil above USD 80 a barrel on US growth

Oil prices surged back above USD 80 a barrel in Asian trade on Friday on news the United States has emerged from a long and painful recession after posting its strongest growth in two years.

New York's main contract, light sweet crude for December delivery, was trading at USD 80.08 in morning trade, up 21 cents from the previous day.


Brent North Sea crude for December was up 10 cents to USD 78.14.


After four consecutive contractions, the world's largest economy grew at a seasonally adjusted 3.5 per cent in the September quarter from the previous three months, the Commerce Department said.


The rise was the biggest since the 2007 third quarter, when the subprime mortgage market sparked a global financial crisis that spilled over into the world economy.


"The good news is that the 3.5 per cent annualised rebound in the third quarter GDP (gross domestic product) confirms the most severe and longest recession since the 1930s is over," consultancy Capital Economics said.


"We expect economic growth to continue at about the same pace for the next few quarters as pent-up investment demand is released, inventories are restocked and the boost from the fiscal stimulus continues," it said.


The US is the world's biggest energy consumer and the health of its economy and the consumption patterns of Americans are key influences in the oil market.

Honda profit hit by falling sales

Honda's profits for the July to September period more than halved after car sales continued to fall during the global economic downturn.

Net profit came in at 54bn yen ($587m; £359m) for the quarter, down 56% on the 123.3bn yen recorded a year earlier.

Japan's second-largest carmaker said the strong yen had contributed to a fall in sales in overseas markets.

But the fall in profits was less than had been expected, and the carmaker tripled its full-year profit forecast.

Honda says it will now make a net profit of 155bn yen for the year to the end of March, up from its previous forecast of 55bn yen.

It also raised its full-year sales forecast, to 3.4 million cars from 3.29 million cars.

Despite the increase in projected future sales, revenue in the third quarter fell by 27% from a year ago.

This was largely due to falling car sales in overseas markets.

Sales in Japan have been less affected, largely due to government tax breaks and incentives on hybrids such as the new Honda Insight.

"Honda's numbers came in a bit better than forecast and the biggest factor seems to be the year-on-year reduction in production costs," said Andrew Phillips at KBC Securities.

Nokia 'seeking Apple royalties'

Mobile phone maker Nokia is suing Apple to try to extract royalty payments, an analyst has suggested.

Nokia said on Thursday that it was suing Apple for infringing patents on mobile phone technology for the iPhone.

Piper Jaffray analyst Gene Munster estimates that the Finnish company might be looking to force royalty payments of 1-2% on every iPhone sold.

With more than 30 million sold, that would work out to $6 to $12 per phone sold, or as much as $400m.

That would be a relatively small amount compared with Apple's income.

Apple recently reported profits of $1.67bn (£1bn) for the three months to 26 September - partly due to a 7% growth in iPhone sales.

Nokia did not say in the lawsuit what form of penalties it was seeking.

'Uncertain' resolution

Mr Munster, a respected Apple watcher, called the maximum figure of $12 a phone "unlikely" and said even if it was enforced in court, it "would not change our positive thesis on the iPhone and Apple".

"Ultimately, the resolution is uncertain," he said.

An Apple spokesman told the BBC that the firm did not comment on pending litigation.

The 10 alleged patent infringements, which apply to all models of the iPhone since its launch in 2007, involve wireless data, speech coding, security and encryption.

Nokia accused Apple of "trying to get a free ride on the back of Nokia's innovation".

Record recession for UK economy

The UK economy unexpectedly contracted by 0.4% between July and September, according to official figures, meaning the country is still in recession.

It is the first time UK gross domestic product (GDP) has contracted for six consecutive quarters, since quarterly figures were first recorded in 1955.

But the figures could still be revised up or down at a later date, because this figure is only the first estimate.

GDP measures the total amount of goods and services produced by a country.

Sensex sheds 219 pts to dip below 17,000 level

The benchmark Sensex fell for the third straight session on Thursday losing 219 points on heavy selling in realty and banking shares by investors, who took cues from weak overseas markets.

The Bombay Stock Exchange barometer, which had lost 317 points in the last two sessions, fell by 219.43 points to close at 16,789.74 points.

The wide-based National Stock Exchange index Nifty lost 75 points to close at 4,988.60 points.



Brokers said trading sentiment turned bearish after weak Asian markets. Inflation climbing to 1.21 percent for the week ended 10th October was another negative factor, they added.



Downward march was further fueled as Moody's Investors Service downgraded the ratings of 13 Indian commercial banks after its global review of systemic support indicators for individual banking systems, brokers said.



State-run SBI lost 2.50 percent to Rs 2,325.70 and ICICI Bank fell by 4.08 percent to Rs 891.05.



The BSE realty index fell the most losing 4.59 percent to 4,524.28 points after Jaiprakash Associates and DLF registered heavy losses. Jaiprakash Associates plunged by 6.84 percent. Realty major DLF closed lower by 4.93 percent.



Among key Asian indices, Hong Kong's Heng Sang fell by 0.48 percent, while Japan's Nikkei lost 0.64 percent.



China's Shanghai Composite closed down by 0.62 percent, while Kospi dipped by 1.42 percent.



The heaviest and energy giant Reliance Industries fell 2.24 percent to Rs 2,133.55.



Capital goods index fell by 2.69 per cent to 13,644.31. Consumer durable index by 2.65 percent to 3,620.37 and banking index by 2.05 percent to 10,098.65 points.



However, select FMCG and IT counters attracted good buying support. FMCG index rose by 0.95 percent to 2,741.73, IT index by 0.79 percent to 4,437.81 and tech index by 0.61 percent to 2,996.09.



As the profit selling spilled over a wide front, midcap index fell by 2.12 percent to 6,444.27 points and smallcap index by 1.96 per cent to 7,647.77 points.

China economic growth accelerates

China has said it is on track to hit its growth target of 8% this year, after the economy grew 8.9% from a year ago in the third quarter.

The figure is up from the 7.9% rate seen in the previous quarter and is the country's fastest GDP growth since the third quarter of last year.

Separate reports show that industrial production and retail sales also accelerated in September.

The economy grew by 7.7% in the nine months to September.

Retail sales growth was 15.1% in the first three quarters of the year, the National Statistics Bureau said.

China's car market has become the world's largest, with sales up 34% to 9.66 million vehicles in the first nine months of the year.

Oil moves past $80-a-barrel mark

The price of oil breached $80 a barrel in early trading in Asia, a new high for the year, boosted by the weak US dollar and strong US company results.

US light crude then fell back slightly to $79.56. London Brent was unchanged at $77.77 a barrel.

Oil prices are rising as encouraging US company results fuel optimism for the global economic recovery.

Analysts said the short-term direction of oil is being driven by the dollar and rising equity markets.

"I think we will continue higher as we move into the fourth quarter. Investors think equity earnings are a good guide for the economic outlook so the better-than-expected reporting season is supporting [the oil price]," said Mark Pervan at ANZ.

But there are concerns that sentiment, rather than fundamentals, are driving the oil price, and that once these fundamentals re-establish themselves, the price may fall.

These include spare capacity, stock piles of oil and weak demand among industrialised nations.

US welcomes India's decision to allocate sites for N-plants

The US has welcomed India's decision to allocate sites for its two nuclear plants, saying the key step is a recognition of trust and brings the two nations closer to full cooperation on safe and clean energy sources.

On behalf of the people of the United States of America, I am very pleased with this key step that brings our two great nations closer to full cooperation on safe and clean energy sources, US Ambassador to India Timothy J Roemer said in a statement in New Delhi after India made the announcement on Friday.

The government announced that it has allocated sites in Chhayamithi Virdi, in Gujarat, and Kovvada in Andhra Pradesh for the United States for the construction of civil nuclear power plants in pursuance to the agreement with the US for expanded cooperation on the peaceful uses of nuclear energy.



This important announcement comes in welcome recognition of the trust and confidence as well as the growing partnership between our two countries, the Ambassador said.

He said the development not only promises to deliver greater access to clean and affordable energy and electricity for all Indians but also will produce jobs and economic opportunities for the people of both India and the United States.

Along with the two sites for the US, the government also announced earmarking of two sites -- Kudankulam (Tamil Nadu) and Haripur (West Bengal) -- for Russian nuclear plants and one in Jaitapur (Maharashtra) for France in pursuance to civil nuclear deals signed with them.

Oil price hits new high for 2009

The price of oil has reached a new high for 2009, continuing its recent rise on the back of the weak US dollar and strong US company results.

US crude rose 52 cents to $79.05 a barrel in early trading, before slipping back to $78.78, up 25 cents on Friday's close.

London Brent also traded higher, up 22 cents at $77.11 a barrel.

Oil prices surged last week, as encouraging US bank results fuelled optimism for the global economy.

Opel's German aid may break rules

The European Commission has warned that Germany's planned state aid for Opel may breach competition rules, raising the prospect of its sale being halted.

Brussels said there were "significant indications" Berlin pledged the 4.5bn euro ($6.7bn; £4bn) aid only if its preferred buyer for Opel was chosen.

US firm General Motors (GM) said last month it would sell Opel to Canada's Magna, Berlin's preferred buyer.

The Commission said GM should now be allowed to reconsider the sale.

Although GM picked Magna and its Russian backer Sherbank last month to buy Opel and Opel's UK brand Vauxhall, the deal has yet to be concluded.

Neither the German government nor Magna has yet given any reaction to the Commission's comments. The UK's Department for Business, Innovation & Skills also declined to comment.

However, Chris Preuss, GM's global vice-president for communications, said that if the proposed sale to Magna "couldn't pass EU regulations, we'd have no recourse but to reconsider the deal".

"Right now though we are working on a defined agreement with Magna and it's a complicated process with a lot of dialogue," he added.

"There are a lot of discussions going on at the moment, and there's a lot of detail to be ironed out between the German government and the EU."

US criticises 'inflexible yuan'

The US Treasury has criticised China for what it described as the lack of flexibility of the Chinese currency, the yuan.

It also criticised the rapid build-up of China's foreign exchange reserves in a report to the US Congress.

The Treasury said it had serious concerns about the rigidity of China's exchange rate.

But it stopped short of accusing China of currency manipulation, a politically contentious issue in the past.

"Both the rigidity of the renminbi and the reacceleration of reserve accumulation are serious concerns which should be corrected to help ensure a stronger, more balanced global economy consistent with the G-20 framework," the Treasury report said.