VW brand upbeat as cost cuts, new models boost Sept quarter earning

Cost cutting and new models such as the Arteon fastback should continue to boost Volkswagen's main car brand in the fourth quarter after it doubled core earnings in July-September, it said on Monday.

Analysts see reviving the VW brand, which has long suffered from high staff and development costs, as crucial to the group's ability to recover from its diesel emissions scandal.

The brand said on Monday it expected sales and profits to keep growing in October-December, despite the hit across the industry to demand of diesel vehicles and their resale value in the wake of the German carmaker's 2015 scandal.

"Our model offensive is increasingly paying off, the turnaround programmes in the markets are having an effect," VW brand chief Herbert Diess said in a statement.

Operating profit at the brand doubled to 728 million euros ($847 million) in the three months to Sept. 30, helped by cost cuts and staff reductions agreed with labour unions last year.

Volkswagen shares were up 2.9 per cent to 156.40 euros at 1150 GMT.

By contrast, the group's premium Audi division said it was bracing for a "demanding quarter" with costs for vehicle overhauls including the high-end A6, A7 and A8 as well as the Q3 and A1 compacts weighing on results.
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World stocks hit new high as Spain relief, tech rally boost European scrips

A strong rally in the technology sector helped drive global stocks to a record high on Monday, while a recovery in Spanish markets supported European shares after an opinion poll smoothed investors' concerns over Catalan secession.

MSCI's world equity index, which tracks shares in 47 countries, rose 0.2 per cent to its highest ever level. The index has surged 17.7 percent so far in 2017 and is on track for its best annual showing since 2013.

Eurozone stocks climbed 0.3 per cent, holding near their highest level in 10 years. European stocks have rallied this year as a healthy economy dovetailed with convincing growth in corporate earnings and a reduction in political risk.

"There is an avalanche of things that are happening or going to happen, but markets are just shrugging it off. It's like markets have been vaccinated against bad news thanks to the strength of the global business cycle," said Marie Owens Thomsen, global head of economic research at Indosuez Wealth Management in Geneva.

Spanish stocks extended gains, up 2 per cent and set for their best day in three weeks after a weekend poll suggested Catalan secessionists may lose their majority in regional elections scheduled for December.

Spain's benchmark 10-year bond yield fell 5 basis points to 1.486 per cent. Banks Caixabank and Sabadell, which moved their headquarters out of Catalonia due to the crisis, led gains on the IBEX.
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China's top lenders see growth in Q3 net, tapering of bad loans

Four of China's 'Big Five' state-owned banks reported higher quarterly profits and slower growth in bad loans, helped by a resilient economy and checks on the shadow banking sector.

The improved results from top lenders in the world's second-largest economy come after successive interest rate cuts dented their interest margins - a key gauge of profitability - while loan defaults rose sharply among struggling borrowers.

The improvement has been aided by a cocktail of policy measures, such as debt-for-equity swaps for struggling state borrowers.

Industrial and Commercial Bank of China (ICBC), the country's top lender by assets, posted a 3.3 per cent rise in third-quarter net profit, versus flat growth a year-ago.

Agricultural Bank of China (AgBank), China Construction Bank (CCB) and Bank of Communications (BoCom) also reported faster quarterly profit growth than a year ago.

ICBC, CCB and AgBank also reported declines in their non-performing loan (NPL) ratios, as they dispose of more of their bad debt. A crackdown on unregulated shadow banking has also helped.

"The market has been talking about a potential Chinese banking crisis caused by NPLs since 2011," said Jiahe Chen, chief strategist at Cinda Securities. "But after seven years and banks' net assets increased by over 100 per cent, it's now one of the most worthwhile investable industries."
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Rohingya crisis: Thousands rally in defence of Myanmar army

Military songs rang out across downtown Yangon on Sunday as tens of thousands rallied in defence of Myanmar's army, an institution accused by the global community of driving Rohingya Muslims from the country.

More than 600,000 Rohingya have fled western Rakhine state to Bangladesh since late August when raids by militants from the minority group were met with ruthless army "clearance operations".

The United Nations has led global condemnation, calling the crackdown a "textbook" example of ethnic cleansing.

US Secretary of State Rex Tillerson phoned army chief Min Aung Hlaing earlier this week to express his concerns at alleged atrocities in Rakhine state and urge a swift and safe return for the Rohingya.

But inside Myanmar support for the army has surged — an unlikely turnaround for a once feared and hated institution that ruled for 50 years and whose lawmakers lost heavily in 2015 polls.

Those elections sent Aung San Suu Kyi's pro-democracy party into power, but the Rohingya crisis has put her government on the backfoot.

Demonstrators carried banners lauding Commander-in-Chief Min Aung Hlaing and rebuking the international community for "pressuring the Tatmadaw" — as Myanmar's army is known.

"The Tatmadaw is essential for the country, it protects our ethnic groups, races and religion," Nan Aye Aye Kyi, 54, told AFP as the rally snaked through Yangon to the iconic Sule Pagoda.
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First charges filed in probe over alleged Russia meddling in 2016 US polls

The investigation into possible Russian meddling in the 2016 US presidential election will enter a new phase as early as Monday, when the first charges resulting from the probe could be unsealed and a target taken into custody.

A federal grand jury approved the indictment on Friday and a federal judge ordered it sealed, a source briefed on the matter has told Reuters, adding it could be unsealed as soon as Monday.

The indictment could mark a dramatic turn in special counsel Robert Mueller’s investigation into allegations of Russian interference in the 2016 race and any possible links with officials from President Donald Trump’s campaign.

The Russia investigation has cast a shadow over Trump’s 9-month-old presidency and widened the partisan rift between Republicans and Democrats.

US intelligence agencies concluded in January that Russia interfered in the election to try to help Trump defeat Democrat Hillary Clinton by hacking and releasing embarrassing emails and disseminating propaganda via social media to discredit her.

Mueller, a former director of the Federal Bureau of Investigation, has been looking into possible links between Trump aides and foreign governments, as well as potential money laundering, tax evasion and other financial crimes, according to sources familiar with the probe. He also is exploring whether Trump or his aides have tried to obstruct the investigation.

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Marwai war survivors start returning home; terror continues in Philippine

Khaliluddin Ismail returned home on Sunday after five months of war in the southern Philippines to find his house ransacked. But he’s still smiling.

“At least we have something left,” he said, standing in a room with clothes, toys, ornaments and damaged pictures strewn across the floor.

“Others have nothing. They lost their homes, they lost their lives.”

Ismail, 44, the Imam of a nearby mosque, considers himself one of the luckiest people in Marawi. The city was devastated by more than 150 days of battles between government forces and pro-Islamic State militants that killed more than 1,100 people and displaced some 350,000.

His house is in Marawi’s safe zone, an area long abandoned by residents but untouched by unrelenting shelling and military air strikes that have all but flattened the city’s commercial heart, destroying thousands of homes, shops and vehicles.

Six days after troops killed the last remaining rebels, Ismail was among about 4,000 people allowed to return to their homes on Sunday in Marawi’s Basak Malutlot area.

Many like him have discovered their houses were looted and left in disarray.

“I opened the door and I was shocked, but I‘m still happy to be home,” he said.
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Afghan deputy governor of Kunar province kidnapped in Pakistan

Unidentified kidnappers bundled the deputy governor of Afghanistan’s northwestern province of Kunar into a car in the Pakistani city of Peshawar and took him away, police sources said on Sunday.

Mohammad Nabi Ahmadi had crossed over from Afghanistan into Pakistan with his brother and was walking down a road in the northwestern city of Peshawar when a car with tinted windows pulled up and overpowered the Afghan official, according to a Peshawar police source.

The police source said Ahmadi’s brother recounted the episode to Pakistani police, but did not disclose that his brother was a high-ranking Afghan provincial government official.

“It was afterwards we came to know from other sources that he was deputy governor of Kunar,” said the police official.

Abdul Ghani Musamem, the spokesman for the governor of Kunar, confirmed Ahmadi had gone missing in Peshawar on Friday and added that he had been on leave for medical treatment.

Wealthy Afghans frequently cross the border for medical treatment in Pakistan. Many Afghans live in Peshawar and it is also common for influential figures in Afghanistan to have business or family links in the Pashtun regions of Pakistan.

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