SHANGHAI, May 9: China’s money rates fell on Wednesday, with the key seven-day repurchase rate slumping nearly 40 basis points on expectations that the central bank will inject more liquidity into the financial system.

The People’s Bank of China earlier asked commercial banks about their demand for seven-day bond repurchase agreements, traders said, implying the central bank may auction reverse repos on Thursday.

Reverse repos inject short-term liquidity into the financial system.

‘There’s plenty of liquidity, so we are willing to lend money for now,’ said a dealer at an Asian bank in Shanghai. ‘Tomorrow we still have 60 billion yuan deposits being auctioned, so money conditions will not be tight in the near term.’

Dealers said the central banks’ behavior has led traders to anticipate more flexibility in the central bank operations going forward.

‘The central bank may use more flexible tools to inject funds into market, rather than cutting reserve requirement ratios, which will cause a big injection,’ said a dealer at a Chinese bank in Shanghai.

China’s finance ministry will auction 60 billion yuan ($9.51 billion) of six-month deposits to commercial banks on Thursday, which will largely offset the impact of a 65 billion yuan of reverse repos which will mature this week. Maturing reverse repos drain liquidity.

The weighted average of the benchmark seven-day repo rate slumped to 3.3273 percent from Tuesday’s close of 3.7014 percent.

The one-day rate fell to 2.4019 percent from 2.4816 percent, while the 14-day repo rate fell to 3.7616 percent from 3.8036 percent.

Chinese interest rate swaps fell on Wednesday, with the fall in money rates, while the benchmark five-year IRS dipped 3 basis points to 3.34 percent.

One year IRS fell to 2.23 percent while the 10-year IRS was down 2 bps to 3.45 percent.(agencies)

BANGALORE, May 9: NTL Electronics India Limited, the Rs 550 crore Lighting Electronics major from India, today announced sales of 2.19 million LED lamps for 2011-2012.

The sale was realised only during nine months of the fiscal year and not the whole year, the company said in a release here.

The LED lamps are the typical replacement of incandescent bulbs that are in use at homes. The number gains significance in the global context, wherein the total global sales for LED Lamps, as per industry estimates, were around 40 million. NTL Electronics had thus garnered over five per cent of the total sales of LED lamps globally.

‘We believe that LED is the technology for the future and we will exploit the global design, and production strengths of Lemnis to deliver innovative solutions for Home and Commercial lighting globally. We are hopeful that we will look at cornering an even more substantial market-share in the years to come’, said Mr Arun Gupta, MD, NTL Electronics India Ltd in the release.

With an exponential growth in LED lighting systems envisaged, the global sales was expected touch 90.92 million by 2015. (UNI)

HONG KONG, May 9: Hong Kong shares look set for a fifth straight day of losses on Wednesday, dragged by financials and growth-sensitive sectors as investors cut risk and rotate into defensive plays, pointing to caution over the Greek bailout deal possibly unravelling.

Adding to market jitters, China’s ruling Communist Party is ‘seriously considering’ delaying its upcoming five-yearly congress by a few months as the party struggles to finalise a once-in-a-decade leadership change.

The CSI300 Index dropped 1.5 percent by midday, while the Shanghai Composite Index lost 1.3 percent. The China Enterprises Index of the top Chinese listings in Hong Kong fell 1.9 percent, while the broader Hang Seng Index slipped 0.9 percent.

‘There is a distinct defensive tone today. It’s perfectly understandable since long funds have to protect their positions with so much going on, particularly for China, where political uncertainty supercedes most,’ said Wang Ao-chao, UOB Kay Hian’s Shanghai-based head of China equity research.

Chinese oil majors were among the top drags on benchmark indices, hit by slumping oil prices. CNOOC Ltd slumped 2.9 percent in Hong Kong, extending its bleed this week to more than 7 percent.

PetroChina lost 1.5 percent in Shanghai and 1.8 percent in Hong Kong, while China Petroleum and Chemical Corp (Sinopec) lost 1.4 percent in Shanghai and 1.5 percent in Hong Kong.

Chinese banks, seen as barometers of the world’s second-largest economy, were also broadly weaker. In Hong Kong, China Construction Bank (CCB) lost 1.7 percent, while Bank of China slipped 1.6 percent.

CCB’s president told Reuters late on Tuesday that the world’s second-biggest bank by market value will see slower profit growth this year, mirroring the broader economic trend, although its 2012 net profit could still grow by a double digit percentage.

‘We prefer insurers to banks as we believe China banks’ performance is capped by uncertainties surrounding the sector, despite the undemanding valuation,’ Nomura analysts said in a note on Wednesday.

Lucy Feng, Nomura’s China banking analyst, warned of slowing fee-income growth for the sector due to tighter regulatory scrutiny, early signs of asset quality deterioration and rising credit costs that are limiting earnings growth.

China Mobile displayed rare strength on the day, rsing 1.5 percent in Hong Kong, as investors opted for the popular defensive play. The Hang Seng Utilities Index, of which China Mobile is a component, was a relative outperformer among sectors.

Swire Properties jumped 3.8 percent in midday volume that has exceeded its 30-day average, bucking broader market weakness after Goldman Sachs upgraded the stock to ‘buy’ and added the stock to its conviction list.

In a report on Wednesday, Goldman analysts identified Swire as a key beneficiary of the secular growth trend for luxury residential and commercial properties outside central districts in Hong Kong. (agencies)

LONDON/BRUSSELS, May 9: Britain is seeking to persuade fellow European Union members to postpone by up to six months a ban on providing insurance for tankers carrying Iranian oil, arguing that it could lead to a damaging spike in oil prices, European diplomats said.

A European Union ban on importing Iranian oil, which takes effect on July 1, will also prevent EU insurers and reinsurers from covering tankers carrying its crude anywhere in the world.

The impact of the measure is likely to be felt strongly in London’s financial district, the centre for marine insurance.

Iran exports most of its 2.2 million barrels of oil per day to Asia. The four main buyers – China, India, Japan and South Korea – have yet to find a way to replace the predominantly Western insurance shipping cover provided by London insurers.

The sanctions seek to stem the flow of petrodollars to Tehran to force it to halt a nuclear programme that the West suspects is intended to produce weapons.

Some Indian and Chinese firms have already asked state insurers to step in and provide coverage by offering government guarantees. .

The situation is more complicated for Japan and South Korea, which have already cut imports of Iranian oil under pressure from Washington, but need Western protection and indemnity (P&I) ship insurance to continue importing the remaining volumes.

‘Britain will be pushing the EU to postpone the ban on P&I insurance by six months,’ said one diplomatic source.

‘The main reason is pressure from Japan and South Korea as they would struggle to buy oil after July 1,’ the source said.

He said Britain feared oil prices could rise sharply as a result of disruptions caused by the lack of insurance after July 1, as Japan and South Korea would be forced to bid aggressively for alternative supplies to meet their needs.

A second European diplomatic source said he was aware of the British initiative.

PROPOSAL YET TO BE DISCUSSED

Both sources said Britain’s proposal had yet to win support from other EU members, including France, which has been pushing for the toughest stance on Iran.

But in Asia, some shippers welcomed the proposal.

‘A six-month delay would give more time for alternative arrangements to be made or for the situation to become clearer,’ said Arthur Bowring, managing director of the Hong Kong Shipowners Association and a supporter of Britain’s actions.

‘It could also be an opening for a more permanent arrangement to be worked out.’

It was not yet clear when the measure could be debated by EU officials as a meeting to review the embargo on Iranian oil has been rescheduled from the middle of May to an unspecified date.

Japan, South Korea and India have lobbied EU officials for exemptions to the sanctions. ‘One keeps hearing about positive developments on this issue, so we are hopeful that some positive outcome may come out,’ said S. Hajara, chairman of the Shipping Corp of India.

Negotiations between Iran and major world powers on nuclear issues resumed in Turkey in April after a 15-month hiatus. Another round of talks is scheduled for May 23 in Baghdad, but Iran has said it wants a softening of sanctions first. (agencies)