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Ft.com
Spain is planning a state bail-out of Bankia, the country’s third biggest bank by assets, in a move likely to involve the injection of billions of euros of public money into the troubled lender. In an abrupt reversal of policy, the Spanish government, which had previously insisted that no additional state money would be needed to clean up the country’s banking sector, confirmed that an intervention was being prepared. Soon after the news broke, Rodrigo Rato, Bankia’s executive chairman and a former International Monetary Fund managing director, resigned from the bank that had been formed in 2010 out of a merger of seven Spanish savings banks, or cajas. http://www.ft.com/cms/s/0/dfd702ee-9840-11e1-8617-00144feabdc0.html

Iran is accepting renminbi for some of the crude oil it supplies to China, industry executives in Beijing and Kuwait and Dubai-based bankers said, partly as a consequence of US sanctions aimed at limiting Tehran’s nuclear programme. Tehran is spending the currency, which is not freely convertible, on goods and services imported from China. Most of the oil that goes from Iran to China is handled by the Unipec trading arm of Sinopec, China’s second-largest oil company, and through another trading company called Zhuhai Zhenrong, the oil industry executives said.http://www.ft.com/cms/s/0/63132838-732d-11e1-9014-00144feab49a.html#axzz1u9kOFjow

Credit Suisse, Deutsche Bank, UBS and other European banks with big fixed income desks are likely to be hit hardest by the global proposal to change the way banks measure risk in their trading books, bankers and analysts said. Under the “fundamental review” proposed by the Basel Committee on Banking Supervision, banks around the world would have to rewrite their risk models for assets they plan to buy and sell to take into account rare but damaging events and market freezes. Banks would also face stricter rules on when items could be moved from the trading book to the banking book, where loans are held to maturity. http://www.ft.com/cms/s/0/4851348e-9756-11e1-83f3-00144feabdc0.html#axzz1u9kOFjow

The US government could make a $15bn profit on its 2008 bailout of insurer AIG, a government auditor has estimated. The Government Accountability Office, the investigative agency of the US Congress, produced the forecast Monday as part of its regular reports on the company’s rescue. Though the estimate could be seen as premature – taxpayers still own most of the company’s common shares – it provides yet another bright spot for a bailout programme which the Obama administration has sought to trumpet for its apparent successes. http://www.ft.com/cms/s/0/343bff0a-988d-11e1-ad3e-00144feabdc0.html#axzz1u9kOFjow

Wsj.com
Japan’s Nikkei climbed 0.7%, Australia’s S&P ASX200 rose 0.4%, and South Korea’s Kospi was up 0.5%. The Hang Seng Index gained 0.5%, while Singapore’s Strait Times Index was up 0.6%. The Dow Jones Industrial Average finished 0.2% lower Monday and the S&P 500 ended flat, while in Europe, France’s CAC 40 closed up 1.65%.http://online.wsj.com/article/SB10001424052702304451104577390843338145330.html?mod=WSJASIA_hpp_LEFTTopWhatNews

Political tumult in Greece stoked new worries about the fragility of Europe’s monetary union on Monday, as talks to form a new government among the winners of the weekend’s elections quickly fell apart in Athens. The collapse revived fears that political turmoil will keep Greece from meeting the stiff terms of its European bailout, ultimately leading to its exit from the euro zone, a move that would threaten the euro’s future and reverberate through other troubled economies, such as Spain and Italy. The drama in Athens came against a backdrop of broader shifts in the Continent’s politics, a day after voters fatigued by austerity in France, Greece and elsewhere came out in force against incumbent leaders.http://online.wsj.com/article/SB10001424052702304363104577389453653069164.html?mod=WSJEurope_hpp_LEFTTopStories

Vladimir Putin was sworn into office for a third term as Russia’s president on Monday, amid a sweeping police crackdown that left the streets of downtown Moscow eerily quiet. Within the Kremlin, departing President Dmitry Medvedev hailed a “reborn” Russia and promised a new stage of development. Mr. Putin told thousands of handpicked guests in the gilded throne room of the czars that he considered it “the meaning of my whole life” to serve Russia, a choice of words likely to stir speculation that he will seek another six-year presidential term in 2018. http://online.wsj.com/article/SB10001424052702304451104577389581884057806.html?mod=WSJEurope_hpp_LEFTTopStories

India has launched an antitrust probe of Google Inc.’s online advertising business to investigate potential anticompetitive practices, government officials familiar with the matter say, marking the latest setback for the Internet company in an emerging market where it has lofty ambitions. The probe, which could take several months to complete, is initially focused on AdWords, Google’s flagship advertising product and main source of revenue. But the agency conducting the investigation, the Competition Commission of India, could expand it to scrutinize other Google services if it sees fit, according to the Indian officials. http://online.wsj.com/article/SB10001424052702304363104577389280326071526.html?mod=WSJEUROPE_hpp_LEFTTopWhatNews

U.K. manufacturers expect exports to increase in 2012 due to buoyant demand in emerging markets, according to a survey published Tuesday. Manufacturers’ group EEF said 70% of firms surveyed expect a rise in exports this year and plan to step up investment to capitalize on new opportunities. Companies intend to invest in new machinery and equipment to expand production capacity to meet further demand, the EEF said. The EEF surveyed 100 U.K. manufacturing companies and found almost a third see India and Southeast Asia as their key growth markets for the year ahead. Almost half expect China to be the http://online.wsj.com/article/SB10001424052702304363104577389881212630996.html?mod=WSJEUROPE_hpp_LEFTTopWhatNews

Australia posted its third-straight trade deficit in March as shipments of key exports such as coal and iron ore once again fell. The deficit figure reinforced the Reserve Bank of Australia’s decision to slash interest rates last week as the economy faltered in the opening months of 2012. The central bank lowered its official cash rate by an outsized 0.5 percentage point to 3.75% in a bid to fan growth. The Australian dollar extended its intraday slide, falling to US$1.0176 from US$1.0188, after Tuesday’s data showed a deficit on goods and services of A$1.59 billion (US$1.62 billion) in March. Analysts had forecast a lower deficit of A$0.9 billion. http://online.wsj.com/article/SB10001424052702304451104577391062111877378.html?mod=WSJASIA_hpp_LEFTTopWhatNews

The Indian government Monday postponed by a year the implementation of new rules cracking down on tax avoidance, in the first sign that it is heeding criticism that recent tax proposals are sapping investors’ confidence.Finance Minister Pranab Mukherjee told Parliament that the proposed General Anti-Avoidance Rules, which will allow tax authorities to scrutinize any deal they think has been structured to evade taxes, will be implemented from April 1, 2013. He added that government agencies now will have to prove wrongdoing, reversing an earlier proposal that placed the onus on companies to prove their innocence. Mr. Mukherjee gave no indication the government planned to alter a second tax proposal to impose a retroactive capital-gains tax on some international transactions that exchange Indian assets. http://online.wsj.com/article/SB10001424052702304363104577389512311360438.html?mod=WSJASIA_hpp_LEFTTopWhatNews

The International Monetary Fund urged Myanmar to implement “incremental” changes to its economy as the Southeast Asian nation opens up under a new government. In an annual economic assessment, which Myanmar agreed to make public for the first time, the IMF largely praised the previously isolated country and said Myanmar “faces an historic opportunity to jump-start economic development.” The fund projected that Myanmar’s economy would grow 6% over the next year, up from an estimated 5.5% growth in the past year, due to stronger commodity exports and higher investment. The country of about 60 million people had annual economic output of about $45 billion through early 2011.http://online.wsj.com/article/SB10001424052702303630404577390761828929528.html?mod=WSJASIA_hpp_LEFTTopWhatNews

U.S. Secretary of State Hillary Clinton, who is on a three-day visit to India, praised New Delhi for beginning to reduce oil purchases from Iran but stopped short of saying whether the country had done enough to avoid targeted U.S. sanctions. The U.S. is calling on countries to reduce purchases of Iranian oil as a way of exerting pressure on Tehran to give up its nuclear program, which Western nations believe is intended to develop weapons but Iran maintains is for peaceful energy purposes. http://online.wsj.com/article/SB10001424052702304363104577389180059709116.html?mod=WSJASIA_hpp_MIDDLEThirdNews

Marketwatch.com
Brazilian stocks turned higher Monday, as outlooks for more domestic interest-rate cuts helped to curb concerns about Europe after voters in Greece and France rejected candidates who backed austerity measures. Brazil’s Ibovespa rose 0.7% to 61,220.43 as finance, industrial and utility issues moved higher, as did shares of state-run oil company Petrobras , by 0.5%. Petrobras’s shares on Friday spiraled 4.3% lower as crude-oil prices fell 4%. The decline in the shares contributed to the Ibovespa’s 2.1% slide on Friday. The index finished last week lower by 1.4%.http://www.marketwatch.com/story/brazil-stocks-gain-rate-cut-expectations-deepen-2012-05-07

China may announce a cut in retail gasoline and diesel prices later Tuesday, consultancy C1 Energy said, quoting a person close to China’s National Development and Reform Commission. The NDRC’s pricing department will meet in the afternoon, C1 said. A meeting usually indicates the NDRC is about to adjust prices, it added. C1 Energy also said the NDRC may cut the retail prices of gasoline and diesel by CNY200 and CNY300 a metric ton. This would represent a decrease of between 2% and 3.3% over current average gasoline and diesel retail ceiling benchmarks of CNY9,980 and CNY9,130, respectively, according to Dow Jones Newswires calculations. http://www.marketwatch.com/story/china-ndrc-may-cut-fuel-prices-later-tuesday-2012-05-07

Reuters.com
President Barack Obama will renew his calls for the U.S. Congress to act on mortgage relief, small business tax credits, and veterans’ assistance to try to refocus the spotlight on lawmakers in an effort to boost the economy. Obama, who is traveling to Albany, New York, on Tuesday, to visit a nanotechnology research center will lay out a “to do” list for Congress, an administration official said.http://www.reuters.com/article/2012/05/08/us-usa-obama-proposals-idUSBRE84704O20120508

Bloomberg.com
Former U.S. Senator Rick Santorum, who ended his bid for the Republican presidential nomination last month, endorsed Mitt Romney as the party’s standard-bearer in the fall election against President Barack Obama. Santorum made his announcement of support for Romney, a former Massachusetts governor, in a statement posted on his website tonight. Santorum withdrew from the race on April 10. http://www.bloomberg.com/news/2012-05-08/santorum-endorses-romney-as-republican-nominee.html

Cnbc.com
Allowing high frequency computer traders into the stock market is like letting ”rats in the grainery,” Warren Buffett’s right-hand man said in an exclusive CNBC interview. Take the rapid trading by the computer geniuses with the computer algorithms,” said Charlie Munger, vice chairman of Buffett’s Berkshire Hathaway , “those people have all the social utility of a bunch of rats admitted to a grainery.” The rebuke of high frequency traders (HFTs) comes nearly two years to the day since the so-called “Flash Crash” on Wall Street when the Dow plunged nearly 1,000 points before quickly recovering. http://www.cnbc.com/id/47330452

Foxbusiness.com
Roughly 207,000 troubled homeowners had their mortgages permanently modified in the first quarter of 2012, a decline of 31% from the same period in 2011, according to statistics from an alliance of mortgage servicers, investors and non-profit counselors Monday. According to the group, Hope Now, about 147,000 homeowners received proprietary loan modifications from banks. An additional 60,225 borrowers had their mortgages permanently modified as part of an Obama administration modification program known as the Home Affordable Modification Program. http://www.foxbusiness.com/markets/2012/05/07/industry-mortgage-modifications-decline-by-31/#ixzz1uFbVIsIu

Washingtonpost.com
Mainland China’s gold imports from Hong Kong surged more than sixfold in the first quarter, adding to signs that the country may displace India as the world’s largest consumer of the precious metal on an annual basis. Imports from Hong Kong were 135,529 kilograms (135.53 metric tons) between January and March, from 19,729 kilograms in the year-earlier period, according to data from the Census and Statistics Department of the Hong Kong government. Shipments in March rose 59 percent from February, yesterday’s data showed. Demand has climbed in the world’s second-largest economy as rising incomes and curbs on property speculation boosted purchases. China may become the biggest user annually this year, according to a forecast from the producer-funded World Gold Council. Last year, total Indian demand including for jewelry and investment was 933.4 tons to China’s 769.8 tons. http://washpost.bloomberg.com/story?docId=1376-M3ON8L0YHQ0X01-1A8B109U2AB0THFVIB5VSSM6V7

BBC.co.uk
A shareholder seeking the dismissal of Yahoo’s chief executive has demanded the search firm allow access to documents relating to his recruitment. In January, Yahoo named Scott Thompson, the president of online payments firm Paypal, as its new head. But investment firm Third Point discovered that Mr Thompson did not hold a degree in computer science as had been claimed. Third Point had set a Monday deadline for Yahoo to fire Thompson. http://www.bbc.co.uk/news/business-17984877

Telegraph.co.uk
Twitter is likely to last longer and become more valuable than Facebook, one of Britain’s leading ad men has claimed. Rory Sutherland, the vice-chairman of Ogilvy & Mather who helped to turn Microsoft into a major consumer brand in the Eighties, said although Facebook might be the most popular social network at the moment, it could struggle to maintain that position. “I can see Facebook being superseded more easily than Twitter being superseded,” he said. “As a forum for outbursts, Twitter’s [character] limit, its haiku element is very appealing. I wouldn’t bet against it being more valuable [than Facebook] in the long term.” http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/media/9250950/Twitter-will-be-more-valuable-than-Facebook.html

Anyone who thought mining was an industry that the UK had consigned to the past may want to think again. Last week saw plans unveiled for what would be Britain’s biggest mining venture since the days of coal. Aim-listed Sirius Minerals hopes to become a global force in the potash industry by developing a venture which mines the fertiliser on the North Yorkshire coast. After studies showed the development between Whitby and Scarborough was viable, management on Monday outlined a $6bn (£3.6bn) investment programme, including a start-up capital cost of $2.7bn.http://www.telegraph.co.uk/finance/commodities/9250716/Sirius-Minerals-lights-up-UK-mining-hopes-with-Yorkshire-potash-plan.html

Independent.co.uk
Greece failed in its efforts to forge a “pro-European” government last night after a watershed election in which nearly two-thirds of voters rejected the reform programme which has
underwritten the country’s international bailout. The prospect of stalemate in Athens, fresh elections next month and a possible exit from the euro sent markets plunging, while Angela Merkel, the German Chancellor, warned that Europe’s most embattled economy must stick to its commitments to international lenders or face default. Greece’s two main parties were locked in talks over a government of national unity but a collapse in their support left them with only one-third of the vote, no parliamentary majority and no obvious coalition partner.http://www.independent.co.uk/news/world/europe/deadlock-pushes-greece-closer-to-euro-exit-7720676.html

The French President-elect, François Hollande, received a double warning from markets and Berlin yesterday after promising to end the “all-austerity” approach to the European financial crisis. Mr Hollande scarcely had a chance to savour his victory in Sunday’s presidential election before jittery markets and a seemingly inflexible statement from Germany reminded him of obstacles to his  proposed new European agenda for “hope” and “growth”. France’s first Socialist President since 1995 will visit the German Chancellor Angela Merkel to outline his growth plans next Wednesday, the day after his inauguration in Paris. http://www.independent.co.uk/news/world/europe/merkel-tells-hollande-eurozone-agreement-is-not-up-for-negotiation-7720684.html

Guardian.co.uk
Downward slide evidence of faltering economic confidence, says group, but London house prices experiencing a ‘mini-boom’. The early 2012 rebound in the housing market has run out of steam, according to Britain’s surveyors, who have reported price declines and falling activity across the country in April in the latest evidence of a broader economic slowdown. The Royal Institution of Chartered Surveyors said that 19% more surveyors reported price falls than price rises, while newly agreed sales turned negative and the number of properties on the books of surveyors rose again. RICS blamed the end of the stamp duty holiday on properties below £250,000, adding that “weak economic data has eroded confidence in the market”.http://www.guardian.co.uk/business/2012/may/08/house-prices-falling-chartered-surveyors

Smh.com.au
The head of the International Monetary Fund has urged indebted countries in Europe and elsewhere to reduce their budget deficits only gradually to avoid further damaging their economies. Christine Lagarde said in a speech in Zurich that steep cuts tend to slow an economy, particularly if a nation is already suffering from weak growth. The head of the global lending organisation didn’t refer to any specific countries. Still, her speech came one day after voters in France and Greece rejected governments associated with cuts in social spending and other austerity measures.http://www.smh.com.au/business/world-business/cut-gradually-preserve-growth-imf-chief-20120508-1y9lq.html#ixzz1uFdjUjhX

Theglobeandmail.com
From his office, the chief executive officer of real estate developer Diamondcorp looks south toward the towers of the Toronto skyline. But what Stephen Diamond sees is the extended expanse of tree tops between his office and the downtown core. The houses beneath those trees are the reason the developer is comfortable making big bets on the city’s condo market. Unlike downtown Tokyo or London or New York, Toronto has a plethora of single-family homes in its core, he points out. So although it is true that there are more condos under construction in Toronto than anywhere else in North America, he doesn’t see it as worrisome: It’s just the next phase of the city’s development. http://www.theglobeandmail.com/report-on-business/economy/housing/developer-has-no-fear-of-a-toronto-condo-bubble/article2425295/

Xinhuanet.com
In spite of hitting new highs consecutively, the effective exchange rate of the yuan remains stable. Since the central bank of China increased the transaction value of the yuan against the U.S. dollar on April 16, the yuan exchange rate has remained active in a larger range and has reached a new high for two times. Especially on May 2, it hit a new high in the third consecutive trading day since the yuan exchange rate reform in 2005. To the upward trend of yuan exchange rate, experts said that the sharp appreciation of the yuan will not appear at present and may slow down in the future. It shows a two-way fluctuating trend. http://news.xinhuanet.com/english/business/2012-05/08/c_131574854.htm

Sales of the top 100 chain stores in China totaled 1.65 trillion yuan (238.63 billion U.S. dollars) last year, according to data released by an industry association on Monday. China Chain Store and Franchise Association said at a press conference that the figure was revised from more than 2 trillion yuan previously after the association adjusted its statistical caliber to ensure accuracy. Shanghai Bailian Group ranked first in the list, with its sales volume hitting 118.21 billion yuan, followed by Suning Appliance and Gome, with each registering sales of 110 billion yuan, the association said. Overseas chain stores Carrefour and Wal-mart saw their sales reach 45.2 billion yuan and 43 billion yuan, ranking the seventh and the ninth, respectively, it said.http://news.xinhuanet.com/english/china/2012-05/07/c_123091092.htm

China will boost sales of its high-end equipment to over 6 trillion yuan (953.9 billion U.S. dollars) per year by 2015, the Ministry of Industry and Information Technology (MIIT) said Monday. That would amount to more than one-third of the current total output of China’s machinery industry, which reached 16.9 trillion yuan in 2011, according to data from the China Machinery Industry Federation. High-end equipment manufacturing will see its sales account for 15 percent of that of the entire equipment manufacturing industry by 2015 and take a much larger share of the international market, the MIIT said in a five-year plan for the industry for the 2011-2015 period. Investment by backbone enterprises in research and development is expected to exceed 5 percent of their annual sales by 2015, according to the plan. http://news.xinhuanet.com/english/business/2012-05/07/c_131573573.htm

Cs.com.cn
China’s housing prices dropped for the eighth consecutive month in April, indicating the country’s property market is cooling at a stable pace. A report released by the China Index Academy (CIA) shows that the month’s average price of 8,711 yuan (1,400 U.S. dollars) per square meter across 100 cities was 0.34 percent lower than March and 0.71 percent lower than April 2011, marking the first year-on-year fall. It is the first time home prices dropped on both a monthly and yearly basis since China initiated its new round of housing market control measures in April 2010.http://www.cs.com.cn/english/ei/201205/t20120507_3341220.html
Thehindu.com
Businesspersons from India and Iran, on Monday, held talks to boost trade between the two countries on a day U.S. Secretary of State Hillary Clinton arrived here, seeking Indian cooperation for sanctions intended to choke Tehran’s controversial nuclear programme. Tehran signalled its interest in purchasing an estimated Rs.25,000-30,000-crore worth of Indian goods every year by having a former Cabinet Minister to head the delegation. India and Iran have been forced to turn to this system because most financial institutions are wary of dealing with Tehran due to the threat of being locked out by western countries. Speaking at a reception, organised for the 50-plus Iranian team, former Commerce Minister Yahya Ale Eshagh said Indo-Iranian trade was poised to grow. He also seemed to dismiss U.S. pressure on other countries to reduce their trade ties with Iran. http://www.thehindu.com/business/article3394615.ece

Union Finance Minister Pranab Mukherjee on Monday admitted in the Lok Sabha that there was a mismatch between procurement and storage of grains. Earlier, the Opposition parties — NDA, Left, SP and RJD — forced an adjournment for about 10 minutes on the issue of the farmers’ plight due to lack of storage for record production of grains. “There is a mismatch. But we are trying to sort out this issue,” Mr. Mukherjee said, making a statement after the adjournment.  This year, there was a record production of both wheat and rice. http://www.thehindu.com/news/national/article3394768.ece

Economictimes.com
India is willing to look at opening more land border crossings with Pakistan, for instance, at places like Munnabao in Rajasthan, India’s high commissioner to Pakistan Sharat Sabharwal said on Monday. He was addressing the inaugural session of the 2nd Aman Ki Asha Indo-Pak Economic Conference. At present, the Attari-Wagah post is the only land border transit point between the two nations. Later this month, home secretaries of the two countries are expected to sign on an agreement to liberalise the business visa regime. In the works are multiple entry visas, abolishing police check-posts and multi-city visas. These measures are expected to give a fillip to Indo-Pak trade, which today is languishing at below $3 billion. The Indian commerce ministry believes that trade between the two countries can touch $12 billion in the next five years, Sabharwal said. He reiterated commerce minister Anand Sharma’s promise that “for every one step Pakistan takes, India will take two”, to further trade between the neighbours. http://economictimes.indiatimes.com/news/economy/foreign-trade/india-ready-to-open-more-land-border-crossings-sharat-sabharwal/articleshow/13044010.cms

Yonhapnews.co.kr
South Korea’s trade with China lagged behind Japan in the first quarter of this year due to fierce competition from a rival exporting country in the world’s most populous market, a Chinese government report showed Tuesday. Trade between South Korea and China reached US$60.3 billion in the January-March period, compared with Tokyo’s trade volume of $79.4 billion with Beijing, according to the report by the Chinese Ministry of Commerce. Taiwan, the majority of whose exports overlap with the South Korean exports, saw its trade with China reach $35.1 billion in the same period. The data, however, did not show the respective figures for imports and exports. South Korea, Japan and Taiwan have been closely competing in China, especially in the categories of electronics, technology products and parts. http://english.yonhapnews.co.kr/business/2012/05/08/51/0503000000AEN20120508002700320F.HTML
Fin24.com
South African gold producers are expected to report lower quarterly earnings with production knocked across the board as output-disrupting safety stoppages continue to sting, a Reuters poll of 7 analysts showed. A dip in the rand gold price is not expected to help either. While the dollar gold price added 6.7% in the three months to the end of March, the average rand gold price fell 4% to R421 000/kg because of the local currency’s appreciation against the greenback. http://www.fin24.com/Companies/Mining/Falling-output-hurts-SA-gold-miners-20120507

Tehrantimes.com
The managing director of the World Bank has said he opposes sanctions against the Central Bank of Iran, the governor of the Iranian bank said on Monday.  Mahmoud Bahmani had visited the IMF and the World Bank Annual Spring Meetings in Washington last month.  Bahmani said during the meetings he explained that Iran had no problems in terms of reserves and imports and “the president of the World Bank (Robert Zoellick) acknowledged that sanctions against the Central Bank of Iran (CBI) were meaningless.” He added, “The meetings that we had with the bank chiefs of the different countries announced their readiness to have commercial ties with us.” http://www.tehrantimes.com/economy-and-business/97641-world-bank-chief-opposes-sanctions-on-irans-central-bank-cbi-governor

Japan is considering a new law to provide sovereign guarantees for its ships to allow them to continue importing Iranian crude oil after EU sanctions come into effect in July, the Nikkei business daily said. The European Union has already prohibited European insurance coverage on hull and machinery for Iranian crude shipments, which has significantly limited Japan’s lifting of Iranian crude from April. The European Union in March, however, extended European insurance for oil spills on Iranian oil shipments until July 1, responding to calls for exemptions by Japan and South Korea.http://www.tehrantimes.com/economy-and-business/97640-japan-to-insure-ships-carrying-iran-oil