Mediaboss Marketing

February 03, 2012, 8:49 AM EST

By Zachary Tracer

Feb. 3 (Bloomberg) -- Perfect World Co. led a rally in Chinese Internet stocks traded in the U.S. as Facebook Inc.’s initial public offering plans lure investors to similar companies in the world’s fastest-growing major economy.

The Bloomberg China-US 55 Index of the most-traded Chinese stocks listed in New York climbed 0.6 percent to 105.61 yesterday, the highest since Sept. 1. Online game developer Perfect World jumped the most in four weeks and Renren Inc., which operates a social-networking website, gained 8.2 percent. Video site Youku Inc. surged to the highest level since August.

Facebook’s IPO, the largest ever for an Internet company, comes amid a 10 percent advance in Chinese stocks traded in the U.S. this year, and Renren, Youku and online bookseller E- Commerce China Dangdang Inc. are among the biggest gainers on the China-US 55 measure. There are a lot of “opportunities” in Internet companies that have undertaken IPOs, Kevin Pollack, a fund manager at Paragon Capital LP in New York, said at the Bloomberg Link China conference on Feb. 1.

“Given the massive market cap of Facebook, it is forcing a lot of investment managers to really focus on the sector for the first time,” Lou Kerner, a former analyst at Wedbush Securities Inc. who founded Second Shares, a New York-based blog focused on social media companies, said in an interview yesterday. “You’re going to see a lot of institutions that allocate money to social media.”

Beijing-based Renren gained 8.2 percent to $5.42 in New York, extending its advance this year to 53 percent. Perfect World, also based in the capital, climbed 9 percent to $11.50, the highest level since Jan. 6.

China ETF Jumps

Sina Corp., operator of a service similar to Twitter based in Shanghai, added 1.9 percent to $75.30, the highest Nov. 16. Beijing-based Youku climbed 7.9 percent to $24.72, the strongest since Aug. 31, and E-commerce, known as Dangdang, added 2.7 percent to $7.19.

The iShares FTSE China 25 Index Fund, the biggest Chinese exchange-traded fund in the U.S., climbed for a third day, adding 1.3 percent to $39.93, the highest level since Aug. 3. The ETF is up 15 percent this year.

The rally in Chinese stocks has pushed Internet companies beyond prices that are justified by their earnings and growth prospects, Echo He, an analyst at Maxim Group LLC in New York, said by phone yesterday. Renren and Sina may struggle to grow amid competition from other Chinese social networks such as one devised by Tencent Holdings Ltd. Tencent, China’s biggest Internet company by sales, jumped 0.7 percent to $24.20 in New York yesterday.

No Profit

Renren won’t report a profit for 2011 as sales rise 55 percent to $119 million, according to analysts’ estimates compiled by Bloomberg. Sina’s revenue will increase 15 percent to $465 million for 2011, according to a separate analyst survey.

Facebook’s sales grew 88 percent to $3.71 billion in 2011. The world’s largest social network may be valued at $100 billion in the IPO, two people with knowledge of the matter who declined to be identified said last week. That’s 27 times 2011 sales. Renren trades at about 25 times estimated 2011 sales, while Sina trades for about 11 times revenue.

Casino operator Melco Crown Entertainment Ltd. advanced for a third day, rising 3.2 percent to $12.12, a 3.9 percent premium over its Hong Kong shares, which gained 4 percent to HK$30.15, or $3.89. Each Melco Crown American depositary receipt is worth three ordinary shares.

PetroChina Co., China’s biggest energy producer, advanced 0.5 percent to $148.90 in New York after the Beijing-based company’s Hong Kong shares rose 1.9 percent to HK$11.62, the equivalent of $1.50. Each ADR is worth 100 ordinary shares. The U.S. stock traded at a 0.6 percent discount to Hong Kong.

Government Restrictions

PetroChina agreed to buy a 20 percent stake in a Royal Dutch Shell Plc project in Canada, Mao Zefeng, the Beijing-based senior assistant secretary to PetroChina’s board, said yesterday.

Facebook is considering entering China, where it currently has little presence because of government restrictions, according to the company’s IPO filing.

“China is a large potential market for Facebook, but users are generally restricted from accessing Facebook,” the company wrote in the filing. “We do not know if we will be able to find an approach to managing content and information that will be acceptable to us and to the Chinese government.”

Maxim Group’s He said that Facebook doesn’t pose a threat to Renren and Sina because it will be difficult for the Menlo Park, California-based company to get government permission to work in the Chinese market. Facebook would probably have to censor its content to comply with Chinese rules, He said.

The Shanghai Composite Index of domestic shares rose 2 percent yesterday, the best one-day performance in two weeks. The Hang Seng China Enterprises Index advanced 2.9 percent in Hong Kong.

--Editors: Emma O’Brien, Marie-France Han

To contact the reporter on this story: Zachary Tracer in New York at ztracer1@bloomberg.net

To contact the editor responsible for this story: Emma O’Brien at eobrien6@bloomberg.net

Read the original here:
Perfect World Drives Web Surge on Facebook IPO: China Overnight

Yandex NV (YNDX) climbed to a two-month high in New York as enthusiasm for Internet stocks spurred by Facebook Inc.’s initial public offering lured investors to the cheapest Russian web company.

The operator of Russia’s most popular Internet search engine, Yandex led gainers on the Bloomberg Russia-US 14 Index of Russian companies traded in New York, which was little changed at 105.82 yesterday as seven stocks rose and six declined. Futures (VEA) expiring in March on Moscow’s dollar- denominated RTS index (RTSI$) were also steady at 159,930 in U.S. trading. Urals crude oil hit an 11-week high.

Emerging-market Internet stocks from Chinese online game developer Perfect World Co. (PWRD) to South Korea’s largest search engine NHN Corp. (035420) have rallied since Facebook filed for what will be the largest IPO for an Internet company. Yandex, which has slumped 45 percent since its May IPO, trades at 38 times analysts’ earnings estimates, compared with 43 times for competitor Mail.ru Group Ltd., the largest Russian-language web company.

“Investors have taken a refreshed look at Russia’s Internet stocks on the back of Facebook’s IPO and Yandex has come out as the winner today,” said Marco Casas, vice president for equity sales at Otkritie Financial Corp. in New York. “We expect momentum to continue in the next few days as investor interest in Russian Internet names, such as Yandex, increases.”

Yandex advanced 3.6 percent to $21.39 in New York yesterday, the highest level since Dec. 7. Mail.ru (MAIL), which has a 2.3 percent stake in Facebook, fell 0.6 percent to $33.60 in London, after rising for the previous six days.

‘Yandex Undervalued’

Internet advertising in Russia will increase 25 percent this year from 2011, while the overall ad market will probably expand 10 percent, HSBC Holding Plc analyst Jean Kaplan wrote in a Jan. 13 report. The Internet’s share of total Russian advertising will jump to 26 percent by 2018, from 14 percent last year, as more Russians buy computers and access the Web, Kaplan said.

“Everybody has been buying Russian Internet stocks on the Facebook IPO news,” said Konstantin Chernyshev, head of research at UralSib Financial Corp in Moscow. “According to our estimates, Yandex is undervalued by 26 percent. Yandex is cheaper than Mail.ru, so if you buy Russian Internet, you buy Yandex.”

The Hague, Netherlands-based Yandex’s share of the Russian search market declined to 59.7 percent in the week through Jan. 22, from 59.9 percent the previous week and below the four-week average of 59.8 percent, according to Liveinternet.ru, an Internet-service provider and researcher. Moscow-based Mail.ru’s audience rose to 8.5 percent in the week to Jan. 22, from 8.1 percent the week before and above the four-week average of 8.2 percent, the data showed.

Search Share

Yandex, which reports fourth-quarter earnings on Feb. 22, introduced a free search application for the Apple Inc. iPhone in December, part of an effort to expand its mobile offerings.

Yandex’s search share fell to 59.4 percent in the week through Jan. 29, while Mail.ru’s rose to 9 percent, Liveinternet data showed. Mountain View, California-based Google (GOOG) Inc.’s share of the Russian search market fell to 25.5 percent from 25.7 percent the previous week. Google trades at 14 times analysts’ earnings estimates.

“Yandex has been a laggard among Russian equities, so this is a chance to play catch-up.” Tom Furda, director of Russian equity sales at Auerbach Grayson & Co.’s Moscow-based brokerage partner UralSib Financial Corp., said by phone yesterday.

Falling Volatility

The RTS Volatility Index (RTSVX), which measures expected swings in the index futures, was little changed at 30.95, the lowest level since Aug. 4. The Market Vectors Russia ETF (RSX), a U.S.-traded fund that holds Russian shares, fell for the first time in three days, losing 0.5 percent to $30.99.

Russia’s central bank meets to review key interest rates in Moscow today, after cutting the refinancing rate by 25 basis points, or 0.25 percentage point, to 8 percent in December. OAO Rosneft, Russia’s largest oil producer, will report fourth- quarter results.

American depositary receipts of OAO Gazprom (OGZPY), the world’s biggest natural gas exporter, climbed to the highest level since Nov. 8 in New York, adding 1 percent to $12.40 after its shares traded in Moscow rose 0.8 percent to 187.24 rubles, or the equivalent of $6.18. One ADR represents two ordinary shares.

Gazprom trades at 3.6 times analysts’ estimated earnings, while smaller Russian oil and gas producer OAO Surgutneftegas (SGTPY) trades at 5.8 times. Royal Dutch Shell Plc (RDSA), Europe’s largest energy company, has a ratio of 7.2, and Exxon Mobil Corp. (XOM), the world’s largest energy company by market value, has 10.2.

Gazprom ‘Unloved’

“Gazprom is unloved, it’s straightforwardly cheap and there’s every chance that you’ll see improvements in corporate governance over the next six to 12 months,” Martin Diggle, director of the $70 million Vulpes Russian Opportunities Fund (ARTRUSS), said by phone from Geneva yesterday. The Vulpes Fund lost 13 percent in 2011, ranking in the 69th percentile, according to data compiled by Bloomberg.

Moscow-based Gazprom said in December that it may double its dividend payout for 2011 to a record and cut planned investments for this year by 39 percent.

ADRs of Gazprom Neft, Gazprom’s oil producing arm, gained 1.1 percent to $24.90 as Brent oil for March settlement rose 0.5 percent to $112.07 a barrel on the London-based ICE Futures Europe exchange.

Urals, Russia’s chief export blend, added 0.6 percent to $112.30, the highest level since Nov. 15.

OAO RusHydro (RSHYY), Russia’s largest hydropower producer, fell in U.S. trading on concern colder weather in Russia will reduce electricity production, and as Deutsche Bank AG cut its target price for the company’s stock. RusHydro’s ADRs dropped 1.5 percent to $3.91, paring their advance to 29 percent this year.

The RTS Index (RTSI$) in Moscow rose 0.2 percent to 1,602.99, and the 30-stock Micex Index gained 0.2 percent to 1,542.39.

To contact the reporters on this story: Leon Lazaroff in New York at llazaroff@bloomberg.net, or Halia Pavliva in New York at hpavliva@bloomberg.net

To contact the editor responsible for this story: Emma O’Brien at Eobrien6@bloomberg.net

See the original post here:
Yandex Boosted by Facebook as Cheapness to Mail.ru Lures: Russia Overnight

Perfect World Co. (PWRD) led a rally in Chinese Internet stocks traded in the U.S. as Facebook Inc.’s initial public offering plans lure investors to similar companies in the world’s fastest-growing major economy.

The Bloomberg China-US 55 Index of the most-traded Chinese stocks listed in New York climbed 0.6 percent to 105.61 yesterday, the highest since Sept. 1. Online game developer Perfect World jumped the most in four weeks and Renren Inc. (RENN), which operates a social-networking website, gained 8.2 percent. Video site Youku Inc. (YOKU) surged to the highest level since August.

Facebook’s IPO, the largest ever for an Internet company, comes amid a 10 percent advance in Chinese stocks traded in the U.S. this year, and Renren, Youku and online bookseller E- Commerce China Dangdang Inc. (DANG) are among the biggest gainers on the China-US 55 measure. There are a lot of “opportunities” in Internet companies that have undertaken IPOs, Kevin Pollack, a fund manager at Paragon Capital LP in New York, said at the Bloomberg Link China conference on Feb. 1.

“Given the massive market cap of Facebook, it is forcing a lot of investment managers to really focus on the sector for the first time,” Lou Kerner, a former analyst at Wedbush Securities Inc. who founded Second Shares, a New York-based blog focused on social media companies, said in an interview yesterday. “You’re going to see a lot of institutions that allocate money to social media.”

Beijing-based Renren gained 8.2 percent to $5.42 in New York, extending its advance this year to 53 percent. Perfect World, also based in the capital, climbed 9 percent to $11.50, the highest level since Jan. 6.

China ETF Jumps

Sina Corp. (SINA), operator of a service similar to Twitter based in Shanghai, added 1.9 percent to $75.30, the highest Nov. 16. Beijing-based Youku climbed 7.9 percent to $24.72, the strongest since Aug. 31, and E-commerce, known as Dangdang, added 2.7 percent to $7.19.

The iShares FTSE China 25 Index Fund, the biggest Chinese exchange-traded fund in the U.S., climbed for a third day, adding 1.3 percent to $39.93, the highest level since Aug. 3. The ETF is up 15 percent this year.

The rally in Chinese stocks has pushed Internet companies beyond prices that are justified by their earnings and growth prospects, Echo He, an analyst at Maxim Group LLC in New York, said by phone yesterday. Renren and Sina may struggle to grow amid competition from other Chinese social networks such as one devised by Tencent (TCEHY) Holdings Ltd. Tencent, China’s biggest Internet company by sales, jumped 0.7 percent to $24.20 in New York yesterday.

No Profit

Renren won’t report a profit for 2011 as sales rise 55 percent to $119 million, according to analysts’ estimates compiled by Bloomberg. Sina’s revenue will increase 15 percent to $465 million for 2011, according to a separate analyst survey.

Facebook’s sales grew 88 percent to $3.71 billion in 2011. The world’s largest social network may be valued at $100 billion in the IPO, two people with knowledge of the matter who declined to be identified said last week. That’s 27 times 2011 sales. Renren trades at about 25 times estimated 2011 sales, while Sina trades for about 11 times revenue.

Casino operator Melco Crown Entertainment Ltd. (MPEL) advanced for a third day, rising 3.2 percent to $12.12, a 3.9 percent premium over its Hong Kong shares, which gained 4 percent to HK$30.15, or $3.89. Each Melco Crown American depositary receipt is worth three ordinary shares.

PetroChina Co. (PTR), China’s biggest energy producer, advanced 0.5 percent to $148.90 in New York after the Beijing-based company’s Hong Kong shares rose 1.9 percent to HK$11.62, the equivalent of $1.50. Each ADR is worth 100 ordinary shares. The U.S. stock traded at a 0.6 percent discount to Hong Kong.

Government Restrictions

PetroChina agreed to buy a 20 percent stake in a Royal Dutch Shell Plc project in Canada, Mao Zefeng, the Beijing-based senior assistant secretary to PetroChina’s board, said yesterday.

Facebook is considering entering China, where it currently has little presence because of government restrictions, according to the company’s IPO filing.

“China is a large potential market for Facebook, but users are generally restricted from accessing Facebook,” the company wrote in the filing. “We do not know if we will be able to find an approach to managing content and information that will be acceptable to us and to the Chinese government.”

Maxim Group’s He said that Facebook doesn’t pose a threat to Renren and Sina because it will be difficult for the Menlo Park, California-based company to get government permission to work in the Chinese market. Facebook would probably have to censor its content to comply with Chinese rules, He said.

The Shanghai Composite Index (SHCOMP) of domestic shares rose 2 percent yesterday, the best one-day performance in two weeks. The Hang Seng China Enterprises Index (HSCEI) advanced 2.9 percent in Hong Kong.

To contact the reporter on this story: Zachary Tracer in New York at ztracer1@bloomberg.net

To contact the editor responsible for this story: Emma O’Brien at eobrien6@bloomberg.net

View original post here:
Renren Leads Gain in Web Stocks as Facebook Boosts Appeal: China Overnight

February 03, 2012, 8:49 AM EST

By Zachary Tracer

Feb. 3 (Bloomberg) -- Perfect World Co. led a rally in Chinese Internet stocks traded in the U.S. as Facebook Inc.’s initial public offering plans lure investors to similar companies in the world’s fastest-growing major economy.

The Bloomberg China-US 55 Index of the most-traded Chinese stocks listed in New York climbed 0.6 percent to 105.61 yesterday, the highest since Sept. 1. Online game developer Perfect World jumped the most in four weeks and Renren Inc., which operates a social-networking website, gained 8.2 percent. Video site Youku Inc. surged to the highest level since August.

Facebook’s IPO, the largest ever for an Internet company, comes amid a 10 percent advance in Chinese stocks traded in the U.S. this year, and Renren, Youku and online bookseller E- Commerce China Dangdang Inc. are among the biggest gainers on the China-US 55 measure. There are a lot of “opportunities” in Internet companies that have undertaken IPOs, Kevin Pollack, a fund manager at Paragon Capital LP in New York, said at the Bloomberg Link China conference on Feb. 1.

“Given the massive market cap of Facebook, it is forcing a lot of investment managers to really focus on the sector for the first time,” Lou Kerner, a former analyst at Wedbush Securities Inc. who founded Second Shares, a New York-based blog focused on social media companies, said in an interview yesterday. “You’re going to see a lot of institutions that allocate money to social media.”

Beijing-based Renren gained 8.2 percent to $5.42 in New York, extending its advance this year to 53 percent. Perfect World, also based in the capital, climbed 9 percent to $11.50, the highest level since Jan. 6.

China ETF Jumps

Sina Corp., operator of a service similar to Twitter based in Shanghai, added 1.9 percent to $75.30, the highest Nov. 16. Beijing-based Youku climbed 7.9 percent to $24.72, the strongest since Aug. 31, and E-commerce, known as Dangdang, added 2.7 percent to $7.19.

The iShares FTSE China 25 Index Fund, the biggest Chinese exchange-traded fund in the U.S., climbed for a third day, adding 1.3 percent to $39.93, the highest level since Aug. 3. The ETF is up 15 percent this year.

The rally in Chinese stocks has pushed Internet companies beyond prices that are justified by their earnings and growth prospects, Echo He, an analyst at Maxim Group LLC in New York, said by phone yesterday. Renren and Sina may struggle to grow amid competition from other Chinese social networks such as one devised by Tencent Holdings Ltd. Tencent, China’s biggest Internet company by sales, jumped 0.7 percent to $24.20 in New York yesterday.

No Profit

Renren won’t report a profit for 2011 as sales rise 55 percent to $119 million, according to analysts’ estimates compiled by Bloomberg. Sina’s revenue will increase 15 percent to $465 million for 2011, according to a separate analyst survey.

Facebook’s sales grew 88 percent to $3.71 billion in 2011. The world’s largest social network may be valued at $100 billion in the IPO, two people with knowledge of the matter who declined to be identified said last week. That’s 27 times 2011 sales. Renren trades at about 25 times estimated 2011 sales, while Sina trades for about 11 times revenue.

Casino operator Melco Crown Entertainment Ltd. advanced for a third day, rising 3.2 percent to $12.12, a 3.9 percent premium over its Hong Kong shares, which gained 4 percent to HK$30.15, or $3.89. Each Melco Crown American depositary receipt is worth three ordinary shares.

PetroChina Co., China’s biggest energy producer, advanced 0.5 percent to $148.90 in New York after the Beijing-based company’s Hong Kong shares rose 1.9 percent to HK$11.62, the equivalent of $1.50. Each ADR is worth 100 ordinary shares. The U.S. stock traded at a 0.6 percent discount to Hong Kong.

Government Restrictions

PetroChina agreed to buy a 20 percent stake in a Royal Dutch Shell Plc project in Canada, Mao Zefeng, the Beijing-based senior assistant secretary to PetroChina’s board, said yesterday.

Facebook is considering entering China, where it currently has little presence because of government restrictions, according to the company’s IPO filing.

“China is a large potential market for Facebook, but users are generally restricted from accessing Facebook,” the company wrote in the filing. “We do not know if we will be able to find an approach to managing content and information that will be acceptable to us and to the Chinese government.”

Maxim Group’s He said that Facebook doesn’t pose a threat to Renren and Sina because it will be difficult for the Menlo Park, California-based company to get government permission to work in the Chinese market. Facebook would probably have to censor its content to comply with Chinese rules, He said.

The Shanghai Composite Index of domestic shares rose 2 percent yesterday, the best one-day performance in two weeks. The Hang Seng China Enterprises Index advanced 2.9 percent in Hong Kong.

--Editors: Emma O’Brien, Marie-France Han

To contact the reporter on this story: Zachary Tracer in New York at ztracer1@bloomberg.net

To contact the editor responsible for this story: Emma O’Brien at eobrien6@bloomberg.net

See original here:
Renren Leads Internet Surge on Facebook Appeal: China Overnight

FOX Business: The Power to Prosper

The markets drifted between positive and negative territory as traders analyzed monthly retail sales results, corporate earnings and an upbeat reading on the labor market.

Today's Markets

As of 9:56 a.m. ET, the Dow Jones Industrial Average fell 14.7 points, or 0.11%, to 12702, the S&P 500 rose 0.07 point, or 0%, to 1324 and the Nasdaq Composite climbed 5 points, or 0.18%, to 2853.

New claims for unemployment benefits fell to 367,000 last week from an upwardly revised 379,000 the week prior, the Labor Department said. Economists had been expecting claims to fall to 375,000 from an initial reading of 377,000. A separate report released on Thursday from outplacement firm Challenger, Gray & Christmas showed employers shedding 53,486 jobs in January, the largest total since September. 

The more closely watched monthly employment report is on tap for Friday. Analysts will be looking to see if the pace of recovery picked up or slowed down in the first month of 2012. 

Federal Reserve Chairman Ben Bernanke is set to testify before Congress later in the morning. 

On the corporate front, retailers post their same-store sales results from January throughout the day. 

Target (TGT) saw its post-holiday sales jump 4.3%, zipping past estimates of 2.1%. Macy's (M), the department store, revealed a 2.4% increase as compared to estimates of a 3.5% increase. 

Facebook filed its initial public offering prospectus with U.S. securities regulators late Wednesday. The IPO is expected to be one of the biggest in history and comes as part of a fresh round of offerings from Internet companies like Zynga (ZNGA) and Groupon (GRPN).

Merck (MRK) posted a fourth-quarter profit of 97 cents a share on revenue of $12.3 billion. Wall Street expected the healthcare giant to earn 95 cents on $12.53 billion. The Dow component said it sees its full-year EPS hitting between $3.75 and $3.85, compared to analysts’ average $3.83 estimate.

In Europe, debt talks between Greece and its private creditors went on for another day despite reports an agreement was imminent. Both sides have said they expect a deal to be forged this week, but as the week nears its close, hopes are dimming among market participants. 

The euro fell 0.44% to $1.3103, while the U.S. dollar rose 0.35% against a basket of six world currencies tracked by the dollar index. 

Commodities markets struggled amid a modestly stronger greenback. The benchmark crude oil contract traded in New York fell $1.01, or 1%, to $96.60 a barrel after hitting a fresh 2012 settlement low on Wednesday. Wholesale RBOB gasoline slipped 0.74% to $2.871 a gallon. 

In metals, gold fell $2.90, or 0.16%, to $1,746 a troy ounce. 

Foreign Markets

European blue chips fell 0.15%, the English FTSE 100 dipped 0.22% to 5,778 and the German DAX was flat at 6,617. 

In Asia, the Japanese Nikkei 225 rose 0.76% to 8,877 and the Chinese Hang Seng rallied 2% to 20,739.

Original post:
Stocks Seesaw; Data, Corporate Reports in Focus