BlackBerry maker’s shares rise after analyst’s upgrade

Updated 18 January 2013
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BlackBerry maker’s shares rise after analyst’s upgrade

TORONTO: Shares of Research In Motion Ltd. rose 4.6 percent after an influential analyst boosted his rating on the stock, saying RIM’s new BlackBerry 10 devices performed as well or better than rivals in recent tests.
Jefferies & Co. analyst Peter Misek, who lifted his stock rating on RIM to “buy” from “hold,” believes Wall Street was underestimating the strength of RIM’s financial performance after the new devices debut on Jan. 30. He also lifted his price target to $ 19.50 from $ 13.
The stock jumped 4.6 percent to $ 15.59 on the Nasdaq and rose 5.5 percent to C$ 15.51 on the Toronto Stock Exchange.
RIM hopes the re-engineered line of touch-screen and keyboard devices will help win back market share lost to rivals such as Apple Inc’s iPhone and devices powered by Google Inc’s market-leading Android operating system.
Misek, who has been skeptical for some time about RIM’s odds of engineering a turnaround, said recent trials of BB10 test devices showed vast improvements over its existing smartphones.
“Recent tests and demos have shown a solid browser, smooth touch interface, and intuitive navigation. We now believe the operating system performance could be better than or equal to Android Jelly Bean and likely on par with iOS 6,” said Misek, referring to the latest versions of software powering Android and Apple devices.
Shares of RIM, which fell as low as $ 6.22 in September, have more than doubled in value over the last four months as the BB10 launch approaches.
In November, Misek upgraded RIM’s stock to “hold” from “underperform,” arguing that his checks revealed greater carrier support for BB10 than expected.
Misek’s last upgrade had propelled RIM’s shares into double-digit territory for the first time in five months and his latest upgrade pushed the stock to a new 11-month high.
In his latest note, Misek said: “More recent checks indicate that carriers have also agreed to volume commitments for the first two quarters post-launch.”
He said BB10 build orders rose from about 500,000 a month in early December to between 1 million and 2 million a month. Misek now views initial sales of 4 million Blackberry 10 devices a quarter as “not a high hurdle.”
Additionally, developer support was proving to be stronger than expected, noted Misek.
“Our checks indicate that large app developers are going to put resources into developing BB10 apps,” he said. “Previously we had thought they would take more of a wait-and-see approach before committing resources.”


Saudi Arabia, Russia and China give EU trade reforms thumbs down at WTO

Updated 33 min 20 sec ago
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Saudi Arabia, Russia and China give EU trade reforms thumbs down at WTO

  • China is suing US and EU at WTO
  • Kingdom warns new rules are concerning

The EU’s new rules against countries dumping cheap goods on its market got a rough ride at a World Trade Organization meeting, where China, Russia and Saudi Arabia led a chorus of disapproval, a trade official said on Thursday.

The EU, which is in a major dispute with China about the fairness of Chinese pricing, introduced rules last December that allow it to take into account “significant distortions” in prices caused by government intervention.

A Chinese trade official told the WTO’s anti-dumping committee that Beijing had deep concerns about the new methodology, saying it would damage the WTO’s anti-dumping system and increase uncertainty for exporters, an official who attended the meeting said.

China argued that the concept of “significant distortion” did not exist under WTO rules, and the EU should base its dumping investigations on domestic prices in countries of origin, such as China.

The EU reformed its rules in the hope they would allow it to keep shielding its markets from cheap Chinese imports while fending off a Chinese legal challenge at the WTO.
China said that when it joined the WTO in 2001, the other member countries agreed that after 15 years they would treat it as a market economy, taking its prices at face value.

But the US and the EU have refused, saying China still subsidises some industries, such as steel and aluminum, which have massive overcapacity and spew vast supplies onto the world market, making it impossible for others to compete.

China is suing both the US and the EU at the WTO to try to force them to change their rules.

Legal experts say the dispute is one of the most important in the 23-year history of the WTO, because it pits the major trading blocs against each other with fundamentally opposing views of how the global trade rules should work.

In the WTO committee meeting, Saudi Arabia said the new rules were very concerning, and it challenged the EU to explain how EU authorities could ensure a fair and objective assessment of “significant distortion.”

Russia said the EU rules violated the WTO rulebook and certain aspects were unclear and created great uncertainty for exporters. Bahrain, Argentina, Kazakhstan and Oman also expressed concerns.

But a US trade official said the discussion showed that appropriate tools were available within the WTO to address distortions affecting international trade.