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Official praises trade between China, US

China attaches great importance to trade between Chinese provinces and US states, the Chinese vice-minister of commerce said during his recent visit to the United States.

Wang Chao led a Chinese governmental economic and trade delegation to the US states of California and Illinois on July 22-26.

Wang also said the trade relationship is an important foundation of Sino-US relations, and promotes that relationship.

The talks concentrated on investment environment and mutual projects. Entrepreneurs from the two countries also made business deals at the two trade-cooperation seminars in Chicago and San Francisco.

Report: Ministry to sell 30-year bonds at 4.12%

The Ministry of Finance will sell 28 billion yuan ($4.4 billion) in 30-year bonds at a yield of 4.12 percent on Aug 1, according to the median estimate of a Bloomberg News survey.

The highest forecast was 4.13 percent and the lowest 4.08 percent, the survey of five finance companies showed. The estimate compared with the 4.12 percent yield on similar maturity notes in the secondary market seen on Monday, according to data compiled by Chinabond.

Investors will bid on the yield at the auction. The issuer will set the security's coupon by taking the highest winning yield.

J.Crew to open first Asia store in Hong Kong

J.Crew Group Inc, the apparel retailer whose customers include US first lady Michelle Obama, plans to open its first store in Asia in Hong Kong, as the retailer targets tourists from the mainland.

The retailer may open the Hong Kong store as early as next year. Meanwhile, it is also looking for sites in Beijing and Shanghai, CEO Mickey Drexler said in an interview in Hong Kong.

Closely held J.Crew is pushing to reach Chinese shoppers as competition heats up and economic growth slows in the world's most populous nation. The apparel company will join brands that include Abercrombie & Fitch Co, Gap Inc and Burberry Group PLC in courting tourists from China's mainland in the former British colony.

Hong Kong had 28 million tourists from the mainland last year.

Money-market rate jumps the most in a month

China's money-market rate rose the most in a month on speculation that cash supply will wane after the central bank reined in sales of reverse-repurchase contracts.

The People's Bank of China offered 8 billion yuan ($1.3 billion) of seven-day reverse repos today, the least since July 5. A total 145 billion yuan of the contracts will be redeemed this week, including 95 billion yuan on Tuesday dating to China Merchants Bank Co data.

"Liquidity has turned a bit tight because the reverse-repo amount is much less than redemptions," said Guo Caomin, a bond analyst at Industrial Bank Co in Shanghai. "No one is clear about the PBOC's motivation behind this."

Chinese banks told to boost loans for local governments

Some Chinese banks are telling their branches to boost lending to local government financing vehicles, a newspaper said, in a further signal that authorities are loosening credit to reverse a growth slowdown.

The local branches are being instructed to give credit support to provincial-level vehicles and those backed by China's 100 richest counties, according to a on Tuesday report by the China Securities Journal.

Relaxing control of lending to local governments would mark a shift in strategy as China tries to boost economic growth that has slowed for six straight quarters. China had been seeking to reduce regional debts that ballooned from loans in the aftermath of the global financial crisis to 10.7 trillion yuan ($1.7 trillion).

Komatsu cuts full-year profit outlook

Komatsu Ltd, the world's second-largest maker of construction equipment, cut its annual profit forecast after first-quarter earnings dropped 42 percent amid lower sales in China and a slowdown in Indonesian demand.

Net income will probably be 157 billion yen ($2 billion) for the 12 months ending March 31, 2013, compared with an April forecast of 190 billion yen and 167 billion yen a year earlier, the Tokyo-based company said in a statement on Tuesday.

The cut came after the company said profit fell to 32.1 billion yen in the three months to June from 55.7 billion yen a year ago.

Japan's rebuilding from last year's earthquake and tsunami and higher sales from North America failed to cover declining revenue from China, where slowing economic growth and government curbs on the property market are sapping demand.

Hang Lung underlying profit rises on home sales

Hang Lung Properties Ltd, the Hong Kong developer that focuses on building shopping malls on the mainland, said its first-half underlying profit rose 72 percent after it booked more gains from selling homes and commercial assets.

Earnings excluding revaluation gains and deferred tax climbed to HK$2.52 billion ($325 million) in the six months to June 30 from HK$1.47 billion a year earlier, the developer said in a statement to the Hong Kong Stock Exchange on Tuesday.

Hang Lung, Hong Kong's third-biggest developer by market value, joined rivals such as Sun Hung Kai Properties Ltd in divesting shopping malls, offices and parking garages in the city over the past year to raise cash ahead of an increase in government land sales.

Baidu, Sina join hands in smartphone project

Baidu Inc is offering its search engine on Sina Corp's mobile Web portal as part of an agreement aiming to attract more smartphone users in the world's biggest wireless market.

Baidu, China's biggest search engine company, will also install Sina's Weibo micro-blogging service on software for mobile devices, the companies said in a joint statement on Tuesday, without giving a schedule. The alliance covers collaboration on content and data as well, the companies said.

Baidu seeks mobile users for its search services as more surf the Internet on smartphones in China, where mobile ad sales more than doubled to 2.4 billion yuan ($377 million) last year, according to the research company iResearch.

China may increase fuel prices on Aug 10

China may raise gasoline and diesel prices in August for the first time since March after crude costs rose, a commodity researcher said.

Prices may be increased by 350 yuan ($55) a metric ton on Aug 10, C1 Energy said on its website on Tuesday. The cost of the basket of crude oil tracked by the National Development and Reform Commission will have risen more than 4 percent by then, reaching the threshold at which tariffs can be changed, C1 said.

Brent oil, one of the grades in the basket, has jumped 8.7 percent in July, snapping a run of three monthly declines. China has reduced fuel prices three times since May to levels last seen in December 2010. The last reduction was on July 11, when rates were cut by as much as 4.8 percent.

Shanghai-based C1 has in the past correctly reported adjustments before official announcements.

Rising US corn prices affect Chinese imports

Rising prices of US corn have made it more difficult for China to use imports to help relieve its domestic corn shortage, the director of the China National Grain & Oils Information Center said in Beijing on Tuesday.

Shang Qiangmin said China's 2012 and 2013 soybean imports may rise to 60 million metric tons from 58 million tons a year ago, while the domestic harvest may fall to 13 million tons from 14.5 million tons. Shang said the forecast is lower than others in the market because the government is selling domestic reserves, a measure that is likely to continue.

China Water sets up venture for projects

China Water Affairs Group Ltd, a provider of water and sewage treatment, has agreed to establish a joint venture that will be involved in water-related investments and construction in Henan province and nearby provinces.

Jianghe Water Affairs Co, a unit of China Water, plans to invest 135 million yuan ($21.2 million) and own a 45 percent stake in the venture. The remaining portion of the company will be held by Henan Water Resources Construction Investment Co and Huanghe Water Affairs Co, China Water said in a Hong Kong Stock Exchange filing.

"The potential for the water business in Henan province and adjacent areas is booming," the Beijing company said on Monday. Projects related to water resources are now under way in the Yellow River basin, as is the South-North Water Diversion project.

Agencies - China Daily

(China Daily 08/01/2012 page14)