Sun, Jun 29, 2014 - Page 15 News List

World Business Quick Take



Credit rating cut: Moody’s

Moody’s cut Russia’s credit rating outlook to “negative” on Friday, a sign of a possible coming downgrade, citing the threat to the Russian economy from its involvement in the Ukraine conflict. Moody’s held Russia’s overall rating at Baa1, in the low range for investment-grade bonds. However, it warned that the spread of the Ukraine conflict from Crimea to the country’s eastern border with Russia has raised the dangers of “geopolitical event risk” for Moscow, including from western sanctions. It said that the lack of a strong plan and reforms in Moscow to address the country’s weak economy also underpin the outlook cut. It said Russia’s annual growth outlook has fallen to 1.7 percent for the next five years from previous forecasts of 3 percent.


BNP to plead guilty

BNP Paribas SA is set to plead guilty to criminal charges tomorrow in a Manhattan federal court, a person familiar with the matter said, ending a wide-ranging probe that may bring the biggest-ever penalty for violations of US sanctions against rogue nations. The French bank has been in talks with state and federal authorities over a penalty that may reach a record US$9 billion, another person familiar with the matter has said. The investigation is being conducted by the US Justice Department, US Attorney Preet Bharara, Manhattan District Attorney Cyrus Vance Jr and Benjamin Lawsky, superintendent of New York’s Department of Financial Services. It involves alleged violations of sanctions against Sudan, Iran and Cuba, mostly dating from 2002 to 2009, with some continuing until 2011, another person familiar with the matter has said.


AT&T’s Movil stake bought

Mexican tycoon Carlos Slim has bought out US telephone operator AT&T’s US$5.6 billion stake in telecommunications firm America Movil, the companies announced Friday. The acquisition of AT&T’s shares represent 8.27 percent of America Movil’s stock, said a company statement. “Upon consummation of the transaction authorized today by the board of directors, AT&T will no longer be a shareholder of America Movil,” it said. Last year, the American group sold more than 1.5 million shares.


Consumer confidence up

Strong job growth lifted US consumer confidence this month, as Americans looked past the economy’s dismal first quarter performance. The University of Michigan said on Friday that its index of consumer sentiment rose slightly to 82.5 in June from 81.9 in May. That is still below April’s reading of 84.1, which had been the highest in almost a year. Confidence “has remained largely unchanged for the past six months,” said Richard Curtin, an economist at the University of Michigan and director of the survey. “This was remarkable” given that the economy shrank in the first quarter. The survey was mostly conducted when the government had estimated that the economy contracted at a 1 percent annual rate in the first quarter. On Wednesday, that estimate was revised much lower, to show a contraction of 2.9 percent. So far, steady confidence has not translated into more spending. Consumer spending rose just 0.2 percent last month after a flat reading in April.

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