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A
P agi AK
ugust
21, 1996 • T he P driland O bserver
&
: Finance
^Jnrtlatth
(Observer • î
usiness Outlook
S to c k s m ixed
on W all S tre e t
Stocks arc mixed on Wall
Street as investors remain cau­
tious ahead o f tom orrow ’s meet­
ing o f the I ederal Reserve’s rate­
setting committee. In mid-day
trading, the Dow Jones industri­
al average was up 4.44 points to
5,693.89. In the broader market,
advancing and declining issues
were about even on light volume
o f I 7 1 million shares on the New
York Stock Exchange.
AT&T P resid en t
d e p a rts
A communications giant is los­
ing its president and CI O. AT&T
announced today that Alex Mandi
will leave the company to be­
come the chairman and chief ex­
ecutive officer o f a new commu­
nications venture. A ssociated
Communications. M andi,52, was
the architect o f A T& T’s 1994
acquisition o f McC’aw Cellular
Communications, fie also head­
ed A T& T’s long distance, wire­
less, on-line and multimedia ser­
vice businesses before being ap­
pointed A T& T’s president and
chief operating officer.
US m oves a g ain st
M e x ic a n firm
The United States is moving to
punish a Mexican company be­
cause o f its links with Cuba. The
State Department says the action
against Mexican telecommunica-
nob
„
„
lions company G rupo Domos
comes under a new U.S. law aimed
at sanctioning foreign companies
that do business in Cuba.
W ill ta x e s ch o ke
In te rn e t?
State and local tax collectors
are training their cross hairs on
the Internet world as a source o f
revenue. Internet companies fear
high taxes and paperwork could
stifle the computer network and
price it out o f reach o f some us­
ers.
Japan tra d e
surplus down
The Japanese Finance Minis­
try says Japan’s trade surplus
d ro p p e d in July as fo reig n
imports continued to surge into
the nation's economy. For the
17th consecutive month, Japan’s
surplus with the United States
fell.
M o bil to sell oil,
gas field s
Mobil says it will sell its inter­
est m 13 oil and gas producing
fields in the G ulf o f Mexico.
I lores & Rucks Inc. is buying the
fields for $139.3 million. Fairfax,
Va.-based Mobil has operated
many o f the fields, which include
more than 280 wells, since the
early 1950s.
US S how dow n
for Lloyd’s
Floyd’s o f London faces a cru­
cial showdown today in a court
in Richmond, Va. A group o f
100 U.S. investors contends that
Lloyd's sold them a security and
therefore should be subject to
securities laws in the United
States.
P o in tC a s t to sell
new s s o ftw a re
PointCast Inc. says it plans to
ship a retail version o f its news
software product to more than
5,000 stores nationwide by early
October The software enables
computer users to view custom ­
ized news as they surf the I nternet.
The Cupertino, Calif-based com­
pany says the software will re­
main free to anyone who down­
loads it from PointCast's Web
site.
V
tenor o f short-term interest rates,
would bump them skyward.
But, thanks to a series of sluggish
statistics, the experts now are nearly
unanimous in the other direction:
Fed policymakers will do nothing.
Chicago banker Kenneth Skopec
says there is a possibility the Fed will
boos, rates, but no, until after the
election.
Skopec, president o f Mid-City
Financial Corp., says an immediate
concern for policymakers must be
"the huge growth in consumer lend­
ing and credit card debt.”
Government officials rarely point
with pride to the massive and grow­
ing trade deficit, and Tuesday’s re­
port on the shortfall for June is un­
likely to provide anyone with a place
to hide. In May, the global gap wid­
ened to $10.9 billion, up nearly $1.3
billion from a month earlier.
Analysts blamed car dealerships
stoking up supplies o f imports for
this fall’s new model rollouts, as well
as yet another surge in goods from
China.
Second-quarter earnings reports
for the nation’s retailers continue to
I’he economy has been in a gala
mood through much o f this year,
with a crowd o f officeholders in
Washington gleefully wearing the
lampshade.
Yet the nation’s manufacturing
sector sits glumly near the punch
bowl Reports show softening not
only for exports, but in the key cate­
gory o f business capital spending.
Chicago economist Brian Wes-
bury says Friday’s report on July
orders for durable goods will show a
downtick o f 1.2 percent, the second
month in a row that orders have
declined.
But Wesbury, o f Griffin, Kubik,
Stephens & Thompson, an invest­
ment firm, says that still would leave
orders significantly above the year-
earlier level. "The economy appears
to have slowed a bit, but it is still
grow ing m o d e ra te ly ,” he says.
Which means Americans can party
on, right into this fall’s elections.
As recently as a month ago, Tues-
day was expected to be a red-letter
day. Economists were nearly unani­
mous that the Federal Reserve Open
Market Committee, which sets the
come out, with giant Dayton Hudson
Corp, scheduled to provide numbers
Tuesday.
In general, discount—and depart­
ment-store results depict a slow-
grow th eco n o m y , h a rd ly the
ripsnorting activity indicated by the
govemment’s4.2 percent growth rate
for gross domestic product.
But Wall Street analysts are warm­
ing to retailers’ prospects going into
the holiday shopping season. Last
week’s most dismal earnings news
emanated from J.C.
Penney Co., which reported its
quarterly profit fell nearly 20 per­
cent, depressed by a stunning rise in
write-offs forced by customers’ per­
sonal bankruptcies and delinquent
payments.
It has been an unusually cool sum­
mer in Detroit, at least when it comes
to rhetoric between the United Auto
Workers union and the Big Three
automakers.
All that could change Thursday,
however, when labor leaders meet to
announce a target company for crit­
ical contract negotiations; the cur­
rent agreement expires Sept. 14.
Hughes Mexican satélite
Hughes Space and Communica­
tio n s In te rn a tio n a l inc. and
Telecom unicaciones de M exico
(Telecomm) signed a contract this
week for a high-power satellite,
Morelos III. that Hughes will deliv­
er in 1998
M exico’s Secretary o f Commu­
nications and Transportation, o f
which Telecomm is a part, judged
Hughes’ offering as technical ly best
and lowest-priced in a three-way
competition. Los Angeles-based
Hughes thus continues as the sole
builder o f M exico’s satellites.
The previous spacecraft are
Morelos I and II, launched in 1985,
and Solidaridad I and II, launched
in 1993 and 1994, respectively.
Morelos I has been taken out o f
service, and Morelos II is due for
retirement in 1998.
The new satellite, an IIS 601 HP
model, will be one o f the most pow­
erful Hughes has built. By using
g a lliu m a rse n id e so la r c e lls,
Morelos 111 will offer nearly 8 kilo­
watts o f payload power. The satel­
lite will reach not only all o f Mex-
ico, bu, also most o f North and
South America, from its orbital po­
sition o f 116 8x West longitude.
Morelos III doubles the available
communications capacity' at that lo­
cation, now occupied by Morelos
II. The new satellite will carry 24
active transponders in both C-band
and Ku-band, delivering such gen­
eral communications services as
voice, fax, business communica­
tions, television distribution and
educational programming.
Telecomm plans to equip all
schools in Mexico with satellite dish­
es.
Morelos III is to operate for 15
years. Telecomm will make its own
arrangements for launch.
Morelos III will carry three re­
flectors, one for C-band and one for
each o f two Ku-band beams.
The 24 C-band transponders are
powered by 36-watt traveling-wave
tube amplifiers (TWTAs).
Twelve Ku-band transponders
will use 110-watt TWTAs, and the
o th er 12 will have 132-w att
TWTAs.
Equality of opportunity for people with disabilities
continue to have problems o f access
to mainstream education including
suitable, good quality training:
♦ at work: people with disabilities
are two or three times more likely to
he unemployed and to be so fo r long­
er periods than the rest o f the popu­
lation:
♦ mobility and access: many trans­
port systems and public buildings
continue to be inaccessible or acces­
sible only with difficulty;
♦ housing: adapted or adaptable
accommodation is often scarce or
prohibitively expensive;
♦ welfare systems: these systems
generally provide a minimum o f
support which is often insufficiently
tied in to the goal o f facilitating
participation.
E x e c u tiv e S u m m a ry
a n d P o l i c y C o n c lu s io n s
1. Disability, as referred to in this
Communication, takes many forms -
physical, sensory, mental and intel­
lectual. At any point in time, the
number o f people in the European
Community directly affected by some
form o f disability is estimated at
around one tenth o f the total popula­
tion, which at present amounts to
approximately 37 million. About half
o f them are o f working age.
2. Our societies are, in many ways,
organised for an “average” citizen
without any disability, and, there­
fore, a great number o f citizens are
excluded from the rights and opportu­
nities enjoyed by the vast majority:
♦ in education: some young people
3. Many years o f public policy
aimed at accommodating people to
their disabilities has proved to be
insufficient. The old approach is now
giving way to a much stronger em­
phasis on identifying and removing
the various barriers to equal oppor­
tunities and full participation in all
aspects o f life. Changes in the way
we organise our societies can sub­
stantially reduce or even overcome
obstac les encountered by people with
disability. Integration ratherthanthe
narrower aim o f accommodation is
now seen as the key to inclusion in
active society.
The United Nations General As­
sembly crystal I ized this new approach
in 1993 through the resolution on
Standard Rules for the Equalisation
o f Opportunities for Persons with
Disabilities.
4. Primary responsibility for ac­
tion in this area rests with the Mem­
ber States. The implementation of the
new approach is going on in all Mem­
ber States, in different ways, in differ­
ent fields and at different paces
5. This Resolution should serve as
a reference framework for the struc­
tured exchange of useful information
between the Member States; as a
platform to stimulate the clarification
o f common goals and the identifica­
tion o f best practice; and as a guide for
the development and assessment of
appropriate measures within the Mem­
ber States and the Community's own
respective spheres o f action.
6. The European Community has
been active for many years in pro­
moting better living and working
conditions for people with disabili­
ties. The Commission considers that
Community level support can con­
tinue to bring significant added value
to bear on the process o f reflection
and action within, as well as be­
tween, the Member States.
7. This Communication aims at
giving a renewed impetus towards
the rights- based equal opportunities
approach to disability, both in the
Member States, and at the level ofthe
Community.
The common task is one o f valu­
ing, and making space for human
diversity, This is everyone’s busi­
ness in a People's Europe that values
fairness as well as efficiency.
Dollar ends mixed
Som e in v e sto rs, b e ttin g the
Bundesbank might in fact decide not
to cut the repo rate, purchased marks
and sold dollars.
“ W e’ve seen some pretty good
buying o f Deutscheniarks by some of
our customers,” said Dan O ’Connell,
a vice president o f institutional for­
eign exchange at First Chicago NBD
Bank. "I think they’re probably an­
ticipating steady policy from the
Bundesbank.”
However, by the afternoon in New
York, O ’Connell said some custom­
ers began to take profits by selling
marks for dollars.
In late New York trading, the dol­
lar settled at 1.4880 German marks,
down from 1.4930 marks Friday. The
dollar rose slightly to 107.80 Japa­
nese yen from 107.70 yen.
Whether the Bundesbank reduces
its repo rate this week might very
well hinge on whether growth slows
inGermanM 3 money supply— cash,
short-term time deposits and most
savings deposits. The central bank
monitors the money supply figure as
The dollar was mixed against
major currencies Monday, awaiting
the outcome o f a Federal Reserve
meeting and a Bundesbank meeting
later this week.
The Fed is widely expected to
leave short-term interest rates un­
changed in the United States. There
is less certainty about whether the
German central bank Thursday will
lower its 14-day securities repurchase
rate, or repo rate, currently fixed at
3.30 percent.
"W hat the market is focusing on
rig h t now is the u p c o m in g
Bundesbank meeting," said Dorit
Ronnen, a foreign exchange trader at
Bank Leumi Trust Co. o f New York.
“ We have the Federal Reserve
meeting tomorrow as well, but most
market participants have pretty much
decided that the Federal Reserve is
not going to raise interest rates,”
Ronnen said. "Therefore, they’re
hoping the Bundesbank will lower
interest rates.”
A reduction o f short-term interest
rates in Germany would likely boost
the dollar by making bank deposits
denominated in the U.S. currency
more attractive.
a barometer o f future inflation. Ide­
ally, the Bundesbank targets growth
o f 4 percent to 7 percent. But the
money supply has exceeded this
range, growing at 9.6 percent in June.
A report on M3 growth in July is due
out this week.
“ We haven’t seen any M3 data yet
and they’re looking for that before
the (Bundesbank) m eeting,” said
Kevin Harris, an international econ­
om ist at MCM C urrencyW atch.
“That will really tell us more.”
In Asia, both the dollar and the
mark had gained against the yen after
the Ministry o f Finance reported that
Japan's trade surplus shrank 37.7
percent in July to 504.03 billion yen,
or $4.66 billion, compared with a
year ago.
Nevertheless, the dollar and the
mark gave back much o f the gains
chalked up against the Japanese cur­
rency by late in the New York ses­
sion.
In other trading, the dollar edged
lower to Canadian $1.3728 from
Canadian $1.3735.
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French oil deal
GIFT EMPORIUM
French oil group T otal SA said on
Monday that Malaysia’s Petronas had
taken a 30 percent stake in a disputed
project to develop two oil and gas
fields in Iran.
The announcem ent, ending a
search o f more than a year for risk­
sharing partners on the $600 million
projects, comes exactly two weeks
after U.S. President Bill Clinton
signed a bill into law which would
sanction foreign companies which
trade with Iran and Libya which the
United States accuses o f supporting
international terrorism.
DuPont Co unit Conoco Inc had to
dissolve an earlier deal with Iran
after pressure from the White House.
Total, which has always said its
dealings with both Iran and Libya
were within French and international
law, said earlier this month that the
U .S . sanctions, championed by Re­
publican Senator Alfonse d ’Amato,
would not apply to Sirri.
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