FT ALPHAVILLE
Paul J Davies writes for us on why China's $3.4tn FX reserves aren't the crisis wonder-weapon they seem.
NEWS
More EM currency pain: both the Turkish lira and the Indian rupee plumbed fresh record lows against the dollar on Wednesday. The rupee, which breached Rs68, has now fallen 7.8 per cent this week (Financial Times), and more than 20 per cent since May (Wall Street Journal). Wednesday's pressure on the rupee was aggravated by concerns over the effects of military action against Syria, although India's central bank continued to refrain from selling dollars aggressively.
Stock markets in the Philippines, Turkey, and Dubai all sold off heavily as the US and its allies moved closer to intervention (Wall Street Journal). The plans for a strike involve a '48-hour cruise missile attack on selected Syrian military assets' (Financial Times). UN chemical weapons investigators remain at work in Damascus (Reuters).
Brent crude hit a six-month high on speculation of western military strikes. Brent's rise above $117 was joined by WTI increasing to $112.24, its highest level in more than two years. Airstrikes against Syrian forces could push Brent to $125 within days, and regional spillover affecting oil production could cause a brief spike to $150, according to Societe Generale analysts (Bloomberg).
The UK will submit a draft resolution condemning Syrian use of chemical weapons and "authorising necessary measures to protect civilians" to the UN Security Council later on Wednesday, Prime Minister David Cameron said (BBC News).
UK regulators ordered Ryanair to cut its Aer Lingus stake from 30 per cent to 5 per cent. The carrier is expected to appeal the ruling by the UK Competition Commission, which said that Ryanair's current shareholding "had led or may be expected to lead to a substantial lessening of competition between the airlines on routes between Great Britain and Ireland" (Financial Times).
G4S plans a share issue as part of a strategic review to control its debt and reverse losses. The placing of 141m new shares, 10 per cent of the security company's share capital, will accompany further boardroom moves as new chief executive Ashley Almanza attempts to reduce nearly £2bn in net debt (Financial Times).
