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from Breakingviews:

BHP spin-off won’t appeal to commodity players

By Swaha Pattanaik

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

BHP Billiton plans to spin off unwanted parts of its business into a new company. Aluminium and nickel, whose prices are rising, are among assets which will be parked in the yet-to-be-named organisation. A potentially more focused and nimble mining company might sound like an ideal vehicle for investors who want to follow a rising market. Not so fast.

For one thing, the recent price rallies - nickel up by a third in 2014 and aluminium by 12 percent – might not continue at the same pace, even if global GDP growth picks up. Nickel has been buoyed by Indonesia’s seven-month-old ban on exports of unprocessed ore. Aluminium prices have benefited from the voluntary restraint of producers outside China.

Both the ban and the restraint are unusual, and possibly temporary, arrangements. Indonesia wants to force miners to build refining capacity in the country, but the ban could be softened in return for investment commitments. And aluminium producers’ collective production discipline may not withstand the lure of higher prices.

from Breakingviews:

Treasury Wine resistance withers under KKR assault

By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Treasury Wine has decided that a grape is worth more in the bottle than on the vine. The maker of Lindeman’s and Penfolds agreed to open its vaults after the buyout group raised a provisional cash offer to A$3.38 billion ($3.15 billion). Though the bid could yet sour, Treasury’s spell as a listed company looks like it will soon be coming to an end.

from Breakingviews:

Woolworths pays too-steep ransom in Aussie battle

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Woolworths is paying too steep a ransom in its retail battle. The South African group is buying billionaire Solomon Lew’s stake in an Australian unit in an attempt to secure the billionaire’s support in its A$2.1 billion ($2 billion) takeover of upmarket department store chain David Jones. The side deal raises the effective takeover premium – and piles pressure on Woolworths to realise synergies.

from Breakingviews:

Australia’s mistimed austerity could boomerang

By Andy Mukherjee 

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Australians are bracing themselves for what is being billed as the toughest government budget in 20 years. But untimely austerity could boomerang on the country’s shaky economy.

from Breakingviews:

Macquarie shows Wall St rivals a mirror image

By Peter Thal Larsen

The author is a Reuters Breakingviews columnists. The opinions expressed are his own.

Attention, Wall Street investment banks. One of your rivals has just reported a 49 percent jump in full-year earnings, fuelled by unfashionable businesses like trading commodities and asset finance. It earns a double-digit return on equity with lower-than-average leverage. Oh, and its shares are up 50 percent in the past twelve months.

from MacroScope:

A glimmer of hope in Kiev

A glimmer of hope in Ukraine?

Let’s not count our chickens after 75 people were killed over the past two days but President Viktor Yanukovich’s people are saying an agreement on resolving the crisis has been reached at all-night talks involving the president, opposition leaders and three visiting European Union ministers.
A deal is due to be signed at 1000 GMT apparently although no details are as yet forthcoming. There has been no word from the EU ministers or the opposition so far.

Even if the violence subsides and some sort of political agreement is reached (a huge if), there is potential financial chaos to deal with despite Russia’s only partially delivered pledge of $15 billion to bail its neighbour out.

from Photographers' Blog:

From the White House to the Mad House

Bali, Indonesia

By Jason Reed

Just a couple of months ago I was swirling in a perpetual bubble, a privileged circle of photographers whose job it is to photograph one man – the President of the United States.

I did it for ten years and mostly enjoyed every minute. Over that period of time there comes a predictable familiarity to the role, in which you can pre-write all your captions hours and sometimes days in advance and plan your coverage down to the last detail. It is a safe and cosy existence. Due to the nature of the subject, it needs to be.

from Breakingviews:

Privatisations a bright spot for gloomy Aussie M&A

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Privatisation is a bright spot in what looks to be an otherwise dreary year for Australian dealmakers. The country is set for a flurry of activity as cash-constrained local governments prepare to flog existing infrastructure assets in order to fund new projects and create jobs.

from Left field:

England cricket selectors have got it all wrong in the Ashes

It’s not only the on-field performances that let England down in the Ashes. The selectors too got it wrong starting from the initial announcement of the squad to the playing XI that was chosen for the third Test. The team management must also share the blame for going 3-0 down and losing the urn.

They made their first mistake in denying paceman Graham Onions a place in the touring party, a move that then came under harsh criticism in the English media. He has long been considered the second best swing bowler in England after James Anderson and his omission especially after a good season with Durham was baffling if not downright foolish. Instead, Onions is now in South Africa, playing for the Dolphins.

from Global Investing:

Watanabes shop for Brazilian real, Mexican peso

Are Mr and Mrs Watanabe preparing to return to emerging markets in a big way?

Mom and pop Japanese investors, collectively been dubbed the Watanabes, last month snapped up a large volume of uridashi bonds (bonds in foreign currencies marketed to small-time Japanese investors),  and sales of Brazilian real uridashi rose last month to the highest since July 2010, Barclays analysts say, citing official data.

Just to remind ourselves, the Watanabes have made a name for themselves as canny players of the interest rate arbitrage between the yen and various high-yield currencies. The real was a red-hot favourite and their frantic uridashi purchases in 2007 and 2009-2011 was partly behind Brazil's decision to slap curbs on incoming capital. Their ardour has cooled in the past two years but the trade is far from dead.

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