The (early) Lunch Wrap

Good morning New York,


India’s Congress offers low-caste jobs pledge: India’s governing Congress party has promised in its election manifesto to move towards affirmative action for low-caste and tribal people in private companies, a step that prompted immediate criticism from the private sector. So-called “scheduled castes” and “scheduled tribes” already enjoy quotas of reserved jobs and other benefits in the public sector, but the Congress manifesto launched on Wednesday by party leaders Sonia and Rahul Gandhi and Prime Minister Manmohan Singh promised an extension of such policies to private employers. Not everyone is thrilled. (Financial Times)

“The Bank of Japan could decide as soon as mid-May whether further stimulus is needed to keep inflation on track for its 2 percent target after a sales-tax bump next month, an adviser to Prime Minister Shinzo Abe said. “If the BOJ judges that the economy has fallen off its projected path, it will act appropriately and flexibly, and further easing is possible,” Etsuro Honda said in an interview at the Prime Minister’s Office in Tokyo yesterday. “I believe the BOJ will act if it sees changes in price expectations.”” (Bloomberg)

Citic Pacific is planning to buy its parents company’s assets: “Citic Pacific Ltd., the second-best performer on Hong Kong’s benchmark index in the past month, is planning to buy assets from its state-owned parent Citic Group Corp., people familiar with the situation said. The deal could be valued at about $40 billion, the people said, asking not to be identified discussing private information. Citic Pacific plans to issue shares to its parent to help fund the purchase, two of the people said.” (Bloomberg)

Rupert Murdoch has taken a big step in the succession planning of his media empire by appointing his sons Lachlan and James to top roles. Lachlan, 42, will be non-executive co-chairman of 21st Century Fox and News Corp, and James, 41, will become co-chief operating officer of 21st Century Fox, reporting to Chase Carey, president and chief operating officer, but sharing many responsibilities with him. (Financial Times)

SSE freezes energy prices for two years ahead of market inquiry: SSE, one of the UK’s largest energy suppliers, is freezing energy prices until 2016 in what it says is the longest unconditional price promise offered by a UK energy company. It said it would pay for the freeze by driving out costs of £100m a year, partly achieved through job cuts, and by reducing its ambitions in offshore wind. (Financial Times)

“Occidental Petroleum, seeking to raise as much as $8 billion by selling a stake in its Middle East business, said a political dispute in the region is complicating plans to sell to a single investor group. The oil and gas producer may need to break up the assets and sell them to individual countries because political tensions has made it too complicated to win agreement for a single sale to a group made up of Oman, the United Arab Emirates and Qatar, Chief Executive Officer Steve Chazen told investors at the Howard Weil Energy Conference in New Orleans yesterday.” (Bloomberg)

Central bank steps in to calm China bank run: Coming just weeks after the first true default in the Chinese bond market, the localised run on Jiangsu Sheyang Rural Commercial Bank is the latest sign of growing stresses in the country’s financial system. With the panic reaching other branches of the bank, the government intervened on Wednesday. In a video posted on the local government’s website, the governor of Sheyang county promised depositors that their money was safe. Tian Weiyou, the governor, said that People’s Bank of China, the country’s central bank, would protect depositors. (Financial Times)

Loeb files lawsuit over Sotheby’s poison pill: His hedge fund Third Point is suing to remove a defensive measure Sotheby’s installed last October that prevents an activist investor acquiring more than 10 per cent of its stock. Poison pills have repeatedly been approved by US courts, but Third Point argues the tactic is now being illegally used simply to frustrate activists’ attempts to win a seat at the boardroom table. (Financial Times)

Candy Crush developer’s IPO raises $500m despite investor fears over its ability to repeat the app’s success: London-based King raised $500m from the IPO late on Tuesday, valuing the company’s equity at $8bn on a fully diluted basis and making it one of the most valuable European technology companies to go public in years. (Financial Times)

JPMorgan executive Mike Cavanagh quits for Carlyle: He is the third former head of JPMorgan’s investment bank to leave for a life in the more lightly-regulated, less scrutinised and usually better-paid world of hedge funds and private equity. The departure strengthens the hand of Matt Zames, co-chief operating officer, in the eventual race to replace Mr Dimon. (Financial Times)

The SEC “is expected to broaden an exemption for mom-and-pop retail investors from requirements that certain money funds abandon their signature $1 share price and float in value like other mutual funds, these people said. Supporters of a floating share price argue it would train investors to accept slight fluctuations in the value of their shares and so not panic if they fall below the $1 price.” (WSJ)

Markets: 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 push European stocks to two-week highs following a sturdy Asian session. The positive mood sees most 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 $3 to $1,313 an ounce even as the dollar index rises 0.1 per cent to 80.04. The FTSE Eurofirst 300 is up 0.6 per cent after its Asia-Pacific peer rallied 1 per cent and as US index futures show the S&P 500 adding 4 points to 1,870. That would leave the New York benchmark just 8 points below its record high. (Financial Times)

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