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Low gas prices lead Chesapeake into $12bn asset sale
Chesapeake Energy plans to raise $12bn from asset sales in 2012, its latest effort to reduce debt amid the current slough in natural gas prices, the FT says. A deal to sell future output from the Granite Wash fields in Texas,
Further reading
Elsewhere on Tuesday,
- It’s deflation and inflation.
- Why art isn’t a commodity.
- Everyone loves VXX options.
- Understanding the great trade collapse of 2008-2009.
- And about that 1987 myth.
Overnight markets: Mixed
Asian shares drifted lower on renewed concerns about the fallout of the eurozone debt crisis after Moody’s Investors Service downgraded six European countries including Italy and cut its outlook on the UK,
Chesapeake plans $12bn in asset sales
Chesapeake Energy is seeking to raise up to $12bn through asset sales this year, as the company seeks to plug a funding gap that has been exacerbated by low natural gas prices, reports the FT. The second-largest US gas producer had already responded to decade-low prices by idling rigs and seeking to raise production of oil and liquid natural gas,
Oil rush for private equity
The shale gas and fracking boom in America’s oil industry is attracting ever more private equity money, with funds signing three times the value of energy deals in 2011 compared to 2010, the WSJ reports.
Overnight markets: Up
Most Asian markets edged higher as investors took heart from the Greek parliament’s approval of painful austerity measures crucial for getting a second bail-out package, but gains were limited as Athens has yet to reach a final deal with private creditors over a debt write-off,
Warning sign over Chinese imports
China’s imports fell 15.3 per cent in January, indicating pressures on domestic demand beyond the normal Chinese New Year slowdown, the FT reports. The country’s exports also recorded their first year on year drop since late 2009,
Overnight markets: Down
Asian markets were lower after European finance ministers held back a rescue package for Greece, setting out a fresh batch of conditions for Athens, says the FT. The MSCI Asia Pacific index slipped 0.6 per cent with Japan’s Nikkei 225 Stock Average off 0.2 per cent,
Further reading
Elsewhere on Thursday,
- No, banks shouldn’t be in the tail risk-selling business.
- Hempton on Diamond Foods: “There is seldom only one cockroach…”
- Economic recovery complacency?
- Oil &
Overnight markets: Slightly lower
Asian stocks fell after Greek leaders failed to reach an agreement on terms required to secure a second bail-out while Chinese inflation accelerated, which could lead Beijing to maintain tight monetary policies,
Natural gas outrage of the day
The natural gas market has always behaved a little oddly.
First, it’s always been hugely seasonal, thus responsible for many a widow-maker trade. But now investors and traders have to contend with the impact of fracking too,
Stocks hit fresh six-month highs
Global stocks hit a fresh six-month high as hopes for a worldwide economic recovery outweighed the sentiment-sapping impact of the lingering eurozone fiscal crisis, the FT reports. The FTSE All-World equity index was up 0.5 per cent,
Overnight markets: Up
Asian shares inched up with the Japanese market outperforming the region but gains were limited as investors remained cautious after Greece missed another deadline to agree on a debt restructuring,
BHP says Xstrata Glencore deal makes little difference
BHP Billiton, the world’s biggest mining company, sees no reason to change its strategy in light of Glencore’s proposed merger with Xstrata, the FT reports. “People have asked me does this deal make a difference to you,
China moves up fuel ceiling
On Tuesday authorities in China decided to move the ceiling on fuel prices upwards in response to price movements in international markets, the WSJ reports. This is a continuation of a balancing act between shielding consumers from the vulgarities of markets while also trying to rein in any increases in energy consumption and encourage fuel efficiency.
Glencore and Xstrata face blocking threat
The FT reports that several large investors have threatened to block Glencore and Xstrata’s proposed all-share merger, which would create a $90bn commodities giant in the largest global mining deal on record.
Collateralised commodity borrowing, BP edition
From BP’s fourth quarter results on Tuesday:
At 31 December 2011, $131 million of finance debt ($128 million at 30 September 2011 and $790 million at 31 December 2010) was secured by the pledging of assets,
BP raises dividend as progress returns
BP sought to draw a line under the past two years since the Gulf of Mexico crisis, raising its dividend for the first time since it resumed pay-outs a year ago and hailing the return of “operational momentum”,
Glencore and Xstrata agree $90bn deal
Glencore and Xstrata on Tuesday announced an all-share merger that would create a $90bn giant combining the world’s largest commodities trading house with one of the biggest miners of thermal coal, copper,
Further reading
Elsewhere on Tuesday,
- Stigma (for some) in tapping the ECB’s LTRO.
- Barry Ritholtz has a secret about Hank Paulson.
- MF Global, the preliminary trustee report.
- Why a freezing Europe needs a) Qatar b) shale.
Overnight markets: Down
Asian shares took a breather as markets were torn between renewed fears of a Greek default and increasing hopes for a global economic recovery, says the FT. The MSCI Asia Pacific index was up 0.3 per cent after rallying to a five-month high,
Freight rates go negative
Negative bond yields, negative repo rates, and now… negative freight rates. At least route-specific ones.
Bloomberg has the story here (our emphasis):
Glencore International Plc (GLEN) hired a commodity ship with the operator of the vessel earning nothing and contributing to some of the fuel costs after freight rates for hauling raw materials had their worst-ever start to a year.
Glencore raises premium for getting Xstrata
Glencore is likely to pay out an eight per cent premium in its planned $88bn takeover of Xstrata, up sharply from previous expectations, the FT reports. Institutional investors had called for a larger premium given the loss of control represented by the merger deal,
Two brokers scoop up MF Global customers
R.J. O’Brien Associates and Rosenthal Collins, two of Chicago’s oldest independent brokers, ended up gaining the bulk of MF Global’s former customers following its collapse, Reuters reports. Some $1.2bn in segregated customer funds flowed to the two firms in November – $800m to RJO and $362m to Rosenthall — making it the biggest monthly increase for both in three years,
Overnight markets: Up
Surprisingly robust US jobs data bolstered investor risk appetite, overshadowing worries about a lack of progress in Greek debt restructuring talks, says Reuters. MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.3 per cent after climbing as much as 0.7 per cent earlier to its highest in more than five month.
Squeaky Bumi time
We can’t let this Bumi RNS go unnoticed:
REQUISITION OF GENERAL MEETING
The Company announces that the Directors have received a notice from Borneo Bumi Energi & Metal Pte. Ltd, being the holder of not less than 5 percent of the paid-up voting share capital of the Company,
“Glenstrata” to create commodities giant
Glencore and Xstrata could formally announce an $88bn merger as soon as next Tuesday, the FT reports. The deal — modestly codenamed “Everest” — is already being watched for the firepower it could give both firms to bid for rivals within the natural resources industry.
Glencore and Xstrata close to $88bn deal
Glencore and Xstrata have launched merger talks to create a $88bn commodities trading and mining giant with the financial muscle to sweep up some of its biggest rivals, reports the FT. The all-share merger,
CME’s farmer fund
This looks like a sign of the post-MF Global shift in the futures market…
CME Group has unveiled its own $100m insurance fund for family farmers and ranchers, co-operatives etc who are clients of its clearing members.
Shipping costs fall to 25-year low
A glut of ships has driven prices to ship dry commodities to their lowest level in 25 years, raising fears of fresh crisis for an industry vital to global trade, the FT reports. The key indicator of earnings for vessels carrying iron ore,