Asian shares rise after U.S. data, China GDP in focus

By Chikako Mogi

TOKYO (Reuters) - Asian shares rose to their highest in seven months on Thursday, buoyed by a surge in U.S. housing starts that has followed other positive economic data, helping to further ease worries about a slowdown in global growth.

The brighter tone for risk assets weighed on safe-haven U.S. Treasuries, the dollar and the yen.

The MSCI index of Asia-Pacific shares outside Japan was up 0.3 percent, rising for a third day in a row with much of the market's attention set to swing to GDP figures from China, the world's No. 2 economy, due later in the day.

Australian shares jumped 1 percent to a fresh 15-month high. South Korean shares <.KS11> opened up 0.3 percent and Japan's Nikkei average rose 0.9 percent to its highest in nearly three weeks.

U.S. housing starts surged 15 percent in September, the fastest pace in over four years, bolstering sentiment that had already perked up on a fall in the U.S. jobless rate and strong retail sales.

That lifted Wall Street despite concerns that sluggish world economic growth has meant corporate America's year-long streak of profit growth could be nearing an end.

According to Thomson Reuters data through Wednesday afternoon, quarterly earnings for the Standard & Poor's 500 index <.SPX> components will now likely fall 1.7 percent from a year ago, better than a 2.3 percent drop forecast earlier.

In Europe, equity markets also rose on Wednesday, continuing to draw support from hopes that Spain will ask for an international bailout and ease jitters over the country's ability to manage its huge debts.

China's third-quarter gross domestic product is due around 0200 GMT.

It will likely show the world's second-largest economy slowed for a seventh straight quarter, missing the government's target for the first time since the depths of the global financial crisis and possibly signalling still worse to come.

"According to many estimates, the GDP is expected to miss the 7.4 percent consensus which would create an initial drag on the AUD/USD," Neal Gilbert, currency strategist at GFT Forex in New Jersey, wrote in a note.

"However, the down move may be short lived as thoughts of further stimulus from China to prop their economy back up will begin to surface. Therefore, buying of dips in the AUD/USD may be the most effective strategy after the Chinese GDP release."

The commodities-sensitive Australian dollar traded at $1.0377, hovering near a two-week high of $1.0389 hit on Wednesday.

The dollar rose to a one-month high of 79.14 yen early on Thursday, with traders keen to see if it will test its 200-day moving average which stands around 79.40.

The dollar index <.DXY>, which measures the greenback against a basket of six major currencies, inched up 0.1 percent to 79.087, off a one-month low of 78.935 seen on Wednesday.

Investors pushed the benchmark 10-year U.S. Treasury yield to a one-month high of 1.81 percent on Wednesday for its biggest two-day rise since late July.

"The broad USD is battling between its use as a funding currency to invest in emerging markets, and a rise in its value linked to higher yields and growth expectations," Societe Generale said in a research note.

"For now this translates into a higher USD/JPY as the most yield sensitive currency."

USEFUL LINKS:

U.S. housing market: http://r.reuters.com/pum86s

Spanish debt and bond yields: http://link.reuters.com/syb88s

China GDP/exports: http://r.reuters.com/zeq95s

The euro steadied around $1.3110, after reaching a one-month high of $1.3140 on Wednesday.

Investors will be cautious ahead of a meeting of European leaders in Brussels on Thursday and Friday, watching for possible discussions over bailouts for struggling Spain and Greece.

European leaders will try to bridge deep differences over plans for a banking union at the summit, but no substantial decisions are expected, reviving concerns about complacency in tackling the three-year-old debt crisis.

Clear decisions on helping Cyprus, Greece and Spain may also only come at a finance ministers' meeting next month, officials say.

Asian credit markets firmed marginally, with the spread on the iTraxx Asia ex-Japan investment-grade index tighter by 1 basis point.

U.S. crude futures were down 0.2 percent at $91.96 a barrel.

(Editing by Edwina Gibbs)

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Gold flat as investors eye China data, euro zone

SINGAPORE (Reuters) - Gold traded little changed on Thursday - after rising for two days on a weakened dollar - as investors marked time ahead of key economic data from China and a euro zone summit.

FUNDAMENTALS

* Spot gold was little changed at $1,749.40 an ounce by 0017 GMT.

* U.S. gold inched down 0.1 percent to $1,751.10.

* Groundbreaking on new U.S. homes surged in September to its fastest pace in more than four years, a sign the housing sector's budding recovery is gaining traction and supporting the wider economic recovery.

* Spain has set a 90-billion-euro limit for the size of a bad bank created to take over other financial entities' toxic real estate assets, a necessary step to obtain European funding for the sector.

* All eyes are on a string of Chinese economic data due later in the day, including third-quarter gross domestic product figure which is expected to show China's economic growth slowed for a seventh straight quarter to the weakest level since the depths of the global financial crisis.

* Holdings of gold-backed exchange-traded funds stood at 74.804 million ounces, not far off a record of 75.03 million ounces hit last week.

* Investors will also closely watch a two-day summit of European leaders, among growing speculation that Spain will ask for a bailout next month, as the single currency bloc struggles to contain its debt crisis.

* For the top stories on metals and other news, click, or

MARKET NEWS

* The S&P 500 rose for the third consecutive day on Wednesday after housing starts hit a four-year high, but the Dow was weighed down by IBM after it posted weak revenue.

* The euro and Australian dollar hovered at multi-week highs on Thursday, but could see a setback in their two-day rally if a slew of economic reports on China renew worries about the health of the world's second biggest economy.

(Reporting by Rujun Shen; Editing by Eric Meijer)

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Apple manufacturer Foxconn says underage workers used in China

TAIPEI (Reuters) - Apple Inc's largest contract manufacturer, Foxconn, has acknowledged hiring teenagers as young as 14 in a Chinese factory, in breach of national law, in a case that raises further questions over Foxconn's student intern programme.

Labour rights activists in China have accused Foxconn and other big employers in China of using student interns as a cheap source of labour for production lines that are finding it more difficult to attract young adult workers to lower paid jobs.

Foxconn, the trading name of Taiwan's Hon Hai Precision Industry, said it had found some interns at a plant in Yantai, in northeastern Shandong province, were under the legal working age of 16. It did not say how many were underage.

"Our investigation has shown that the interns in question, who ranged in age from 14 to 16, had worked in that campus for approximately three weeks," it said in a statement on Tuesday.

"This is not only a violation of China's labour law, it is also a violation of Foxconn policy and immediate steps have been taken to return the interns in question to their educational institutions," it said.

Foxconn made the announcement after investigating Chinese media reports of underage interns among its China workforce of 1.2 million. It said it had found no evidence of similar violations at any of its other plants in China.

Foxconn said it would work with local government to bar the schools involved in the Yantai case from the intern programme unless shown to be compliant with labour law and company policy.

"However, we recognize that full responsibility for these violations rests with our company and we have apologized to each of the students for our role in this action," the firm said.

It is not clear if the Yantai plant makes Apple products -- Foxconn, the world's largest electronics contract manufacturer, also makes products for Dell Inc, Sony Corp and Hewlett-Packard Co among its other clients.

Foxconn and Apple have been forced to improve working conditions at Chinese factories that make most of the world's iPads and iPhones after a series of well-publicised suicides in 2010 and reports of labour abuses, such as excessive overtime, threw a spotlight on conditions inside the plants.

Last month, a riot broke out at a Foxconn plant assembling iPhones in the northern city of Taiyuan over living conditions inside Foxconn's on-site dormitories for migrant workers.

In response to the scrutiny, Foxconn plans to cut overtime to less than nine hours a week from the current 20.

It defended its intern programme on Tuesday, saying they made up only 2.7 percent of its workforce in China. Internships could be long-term or short-term, carried out in cooperation with vocational schools and other educational institutions.

The average internship lasted about three-and-a-half months, it said.

(Reporting by Taipei bureau; Writing by Mark Bendeich; Editing by Paul Tait)

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Vikram Pandit may exit Citi without much of a parachute

By Tom Hals and Dena Aubin

REUTERS - Vikram Pandit may leave Citigroup Inc without a rich exit package, compensation experts say, although final terms of his departure likely will not be known for several days.

Pandit, who stepped down as chief executive of the bank on Tuesday after months of tensions with the board, is not eligible for a "golden parachute" - a pre-negotiated severance payout - according to Citigroup's most recent annual proxy filing.

Still, as is typical in departures of high-profile CEOs, the company may end up hammering out a financial arrangement with Pandit that would include agreements not to disparage or compete against the bank, executive pay experts said.

Generous CEO exit packages have become a lightning rod for some investors in recent years. At the same time, Pandit's pay has riled many Citigroup shareholders, who rejected his proposed annual compensation in a non-binding "say on pay" vote earlier this year.

The Citigroup board is likely feeling pressure to rein in any further payouts to Pandit, said Mark Borges, a compensation consultant with pay consultancy Compensia.

"If they don't whip him on the way out, they will be second-guessed," he said.

The company declined to comment on financial terms of Pandit's departure, and he did not immediately respond to requests for comment on the matter. In an earlier interview with Reuters, Pandit said the decision to leave was his own and he had been contemplating the exit for some time.

Pandit arrived at the bank in 2007 when it bought his Old Lane Partners hedge fund, landing him $165 million in the deal.

Pandit accepted a $1 salary starting in 2009, after the financial crisis that led to a government bailout of the bank. After Citigroup repaid the bailout funds, his annual salary jumped to $1.67 million in 2011. He was awarded a bonus, options and other payments that year potentially worth about $13.2 million.

This spring, Citigroup shareholders took the unusual step of rejecting a proposed compensation plan for Pandit and other top executives in the say-on-pay vote. Citigroup Chairman Michael O'Neill said late Tuesday that pay issues were "categorically" not the reason for Pandit's departure.

Pandit holds bundles of Citigroup stock options, but the bank's languishing share price has left many of them worthless. He has options granted in 2008 to buy 225,000 shares, but the options are priced at $244 per share and higher. He has options granted last year priced at $41.50 that started vesting in May, but even these are more than 10 percent above Citigroup's current stock price of $37.25.

"Most of what he will leave behind is not actually worth anything at all at the moment," said Paul Hodgson, chief research analyst at GMI Ratings, a corporate governance ratings agency.

Borges said companies often allow departing executives to exercise options up to 60 days after they depart. After that, they usually lose them.

Citigroup has a long-term incentive plan, but Pandit forfeits any awards under the plan by departing before the plan ends, according to the company's proxy statement. Pandit has no pension plan, and leaves with $21.5 million in stock that he already owns, though Hodgson said two-thirds of that is subject to restrictions.

Borges said Pandit's surprise departure may mean his severance package was not negotiated before he left and that the bank's advisers were working "around the clock" to finalize the agreement.

Under a separation plan, the bank could allow Pandit to accelerate his options, receive payments under the long-term incentive plan or negotiate a pro-rated 2012 bonus.

Under federal securities rules, Borges said, public companies are required to disclose material agreements with their CEOs and they are required to disclose executive departures. They have four days to do that under Securities and Exchange Commission rules.

Citigroup said in a securities filing on Monday that Pandit's replacement, Michael Corbat, will receive a salary of $1.5 million.

(Reporting by Tom Hals in Wilmington, Delaware, and Dena Aubin in New York; Editing by Martha Graybow, Gary Hill)

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Weight loss surgery tied to increase in drinking: study

REUTERS - People who had weight loss surgery reported greater alcohol use two years after their procedures, according to a U.S. study.

The researchers, whose findings appeared in the Archives of Surgery, said it's possible that some patients may turn to drinking if the surgery successfully stops their ability to overeat without addressing underlying issues.

In addition, the effect of certain stomach-shrinking procedures on alcohol tolerance may play a part.

"This is perhaps a risk," said Alexis Conason, who worked on the study at the New York Obesity Nutrition Research Center at St. Luke's-Roosevelt Hospital Center.

"I don't think it should deter people from having surgery, but you should be cautious to monitor (alcohol use) after surgery," Conason told Reuters Health.

The study didn't show whether people were drinking in a dangerous way, and there was no clear increase in drug use or smoking after surgery.

Her team's study involved 155 people getting gastric bypass or gastric banding surgery, mostly women. Participants started the study with an average body mass index, or BMI, of 46 - equivalent of a 168 cm (five foot six inch) person weighing 129 kilograms (285 pounds).

Surgery is typically recommended for people with a BMI of at least 40, or at least 35 if they also have health problems such as diabetes or severe sleep apnea.

Alcohol use dropped immediately after surgery, from 61 percent of people who initially reported drinking to 20 percent at one month post-surgery. But by three months, drinking rates had started to creep back up.

And at two years out, people were drinking significantly more often than before their procedures.

That was mainly the case for those who had gastric bypass surgery, not banding. On a scale from 0 to 10 of drinking frequency, where 0 represented never, 5 was sometimes and 10 always, gastric bypass patients reported an increase from 1.86 before surgery to 3.08 two years later.

Conason said gastric bypass, in particular, has been shown to drastically lower alcohol tolerance, to the point that some post-surgery patients have a blood alcohol content above the legal driving limit after just one drink. For some, that could make drinking more appealing, she added.

One limitation of the study is that only one-quarter of the initial participants were still in touch to report their current alcohol and drug use at the two-year mark, so the researchers don't know how everyone else fared.

James Mitchell, a psychiatrist who has studied alcohol use after weight loss surgery at the University of North Dakota School of Medicine and Health Sciences in Grand Forks, said there's also a need for research going on for longer than two years, to see if alcohol use keeps increasing.

"The health risks of obesity are such that people with severe obesity should not forgo bariatric surgery because of this," said Mitchell, who was not involved in the study.

But he added that everyone should be warned about the possibility of increased alcohol use - and people with a history of alcohol abuse should be especially careful. SOURCE: http://bit.ly/JLp3jy

(Reporting from New York by Genevra Pittman at Reuters Health; editing by Elaine Lies)

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NRI from Punjab seek mechanism to cast their vote

From Lalit K Jha Washington, Oct 16 (PTI) More than a year after the Non-Resident Indian's were granted voting rights, a representative body of NRIs from Punjab has urged the Indian Government to develop a mechanism which will facilitate them to exercise their right. "Lok Sabha Elections are coming very near but there is no mechanism for the NRI community to cast their votes in the fourth coming Lok Sabha elections," president of North American Punjabi Association Satnam Singh Chahal said. Milpitas, California based Chahal said it is not possible for eligible voters to travel to India just to cast their votes, neither it is economically viable. As such he urged the Indian Government and the Election Commission of India to grant "proxy-voting" to NRIs. "The voting may be allowed by mail as is available to the members of armed and security agencies and the staff engaged on election duty," he said, adding that a delegation of NAPA had met the then Chief Election of India Dr S Y Quraishi and had submitted a memorandum in this regard. But nothing has moved so far. "The overseas Indian diplomatic missions may be authorized to receive the ballots for onward submission to respective constituencies in India," Chahal said in a media release. PTI LKJ HAZ

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Audits will be conducted to check corruption in MNREGA: Ramesh

Indore, Oct 14 (PTI) Expressing concern over complaints of corruption in MGNREGA projects, Union Rural Development minister Jairam Ramesh today said the government has decided to conduct audit of ten per cent of villages on a random basis every year. Speaking to reporters after participating in 'Nirmal Bharat Yatra' at a village near here, Ramesh said, "I am concerned about complaints of corruption in Mahatma Gandhi National Rural Employment Guarantee scheme from various states. At some places, payments were made towards wages in the names of persons who were dead. "In consultation with state governments, the ministry has decided to make this scheme more transparent and also conduct random audit of ten per cent of village Panchayats every year to check corruption," he said. The minister said the Comptroller and Auditor General was checking the MGNREGA accounts in various states and is likely to prepare a state-wise report by December. PTI HWP ABC MNS PTP

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Naxals torch 4 vehicles, attack police team in Chhattisgarh

Raipur, Oct 14 (PTI) Naxals today torched four vehicles and attacked a police team, injuring two police personnel, in Dantewada district of Chhattisgarh. The incident occurred in the forest area in Surokhi village, police said. The Naxals intercepted four trucks involved in road construction work near the village and set them afire, they said. A CRPF and police team was rushed to the area but as it neared the village, the Naxals attacked it, injuring two personnel, they said. The security personnel retaliated, following which the Naxals escaped, they said. The injured have been admitted to hospital. PTI SNG RT MNS

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Alang observes bandh for second consecutive day

Ahmedabad, Oct 13 (PTI) Ship-breaking companies at Alang Ship Yard observed bandh for the second consecutive day today protesting arrest of three ship-breakers under stringent IPC sections in connection with the death of six labourers in a blast on an oil tanker while it was being dismantled there. All the 135-odd ship breaking units in the Alang Ship Breaking and Recycling Yard area in Bhavnagar district remained closed following the bandh call given by the Ship Recycling Industries Association India (SRIAI). Meanwhile, representatives of various plastic, chemical, transport and other industry associations too have lent their support for the protest, SRIAI joint secretary Nikhil Gupta said. "We plan to observe bandh on Monday as well," Gupta told PTI, adding that they were discussing whether to give a call for Bhavnagar bandh as well. Gupta said that the state and Central government had suffered revenue loss to the tune of Rs 50 crore owing to the bandh. "Workers will be paid their wages even for the bandh days. Besides, SCCI has decided to pay Rs 1 lakh to the family members of the deceased in addition to the amount they would get from workers compensation fund," Gupta said. An explosion and subsequent fire on the oil tanker that was being dismantled at the yard on October 6 led to the death of five labourers on the spot while one person succumbed tohis injuries in the hospital. One labourer is still recuperating in a hospital. Days after the blast, the police arrested proprietors of Kiran Ship Breaking Company, namely, Ram Kishan Jain and Vipan Kumar Jain and their manager Rajesh Jugud in connection with the incident, under IPC section 304 for culpable homicide not amounting to murder. The protesters are demanding that they may be charged for death due to negligence. Kiran Ship owns the plot where the Portuguese tanker was being dismantled when the accident took place. PTI SBC PD ABC PMS PTP

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Teacher assaulted for scolding students

Jodhpur, Oct 13 (PTI) A teacher of a private school was assaulted today for allegedly scolding two students, prompting police to round up four teenagers including the two students of the institution. After being struck in the cheek with a knife, Hitesh Kumar, who is a Science teacher in M R Adarsh Public School here was rushed to hospital, Investigating Officer Gopal Rana told reporters. Kumar received six stitches and was later discharged from the hospital. According to Rana, Kumar had scolded Jugal and Vijay - students of Class X - for misbehaving in the class on October 11. Both students seated on the last bench of the class were thumping the table, he said. "When asked to stop thumping the table, the two students threatened Kumar and today they two called their two friends identified as Akshay and Hemant to teach the teacher a lesson for scolding them," he said. Around 12:30 pm Kumar came out of the school on his cycle, he said adding, one of the boys attacked him and made a cut in his cheek with a knife. "They surrounded my and before I could react, one of them attacked me with knife," the teacher said. Kumar handed over his complaint to the police, however, an FIR is yet to be registered. "We have received the medical report, following which the two students and two others - all in the age group of 16 to 18 years - were rounded up for questioning in the matter," Rana said. PTI Corr KAS

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