China explains details of new oil pricing mechanism

BEIJING, May 8 (Xinhua) -- China's top economic planner Friday announced details of the country's new oil pricing mechanism, for the first time after the new pricing system kicked in at the beginning of this year.

In a statement on its website, the National Development and Reform Commission (NDRC) said China would adjust domestic fuel prices when global crude prices reported a daily fluctuation band of more than 4 percent for 22 working days in a row.

The commission said refiners would enjoy "normal" profit when global crude prices are below 80 U.S. dollars per barrel, but would face narrower profit margins when the crude prices rise above 80 U.S. dollars per barrel.

However, fuel prices would not go further up, or only be raised by a small margin, when crude prices rise above 130 U.S. dollars per barrel, and fiscal and tax tools would be used to ensure supplies, the NDRC said.

Light, sweet crude for June delivery rose 37 cents a barrel to settle at 56.71 U.S. dollars on the New York Mercantile Exchange Thursday after reaching a six-month high of 58.57 dollars.

Crude prices staged strong rally on news of upbeat economic data in the United States, rising more than 10 percent in two weeks.

The NDRC statement also came a day after it denied an online report claiming imminent price hike.

C1 Energy, an energy information website, Thursday reported that the Chinese government would raise fuel prices as of midnight Thursday, but said later the price adjustment had been canceled, with reasons unknown.

Gold edges lower as unexpected job data ease economic worries

CHICAGO, May 8 (Xinhua) -- Gold futures on the COMEX Division of the New York Mercantile Exchange ended slightly lower on Friday after gaining for 4 straight sessions this week, as the economy concerns were further mollified by better-than-expected job data. Silver and platinum fell, too.

Gold price for June delivery dropped 60 cents, or 0.5 percent, to settle at 914.90 U.S. dollars an ounce.

The Labor Department released on Friday that nonfarm payrolls fell 539,000 in April, the smallest decline since last October and well below economists' expectations of 610,000. However, the country's unemployment rate rose by 0.4 percent to 8.9 percent, the highest level since 1983.

The slowing pace of layoffs for April reflected an easing in the massive job destruction during the previous five months despite the higher jobless rate, which is considered to be another sign the economy is bottoming out and recovering gradually, limiting gold's appeal as an asset to hedge the recession risk.

However, worries over inflation helped keep the precious metal loss limited especially after the European Central Bank announced on Thursday to cut its interest rate by 0.25 points to a record low level of 1 percent and the Bank of England also plans to step up efforts to increase the money supply to shore up the economy.

A much weaker dollar was another supportive factor to gold. By the end of gold floor trading time, the rate against euro plummeted more than 2 cents to 1.3594 dollars, the lowest level since March 26.

July silver finished at 13.955 dollars per ounce, down 7.5 cents. July platinum lost 10.20 dollars to 1,147.10 dollars an ounce.

Dollar falls amid better-than-expected job data

NEW YORK, May 8 (Xinhua) -- The dollar fell against major currencies on Friday as risk appetite in foreign exchange trading was boosted by better-than-expected job data.

Non-farm payroll employment declined by 539,000 in April, the U.S. Labor Department reported on Friday. It was the smallest decline in six months, less than a loss of 620,000 expected by analysts and far below the 699,000 drop in March. The unemployment rate rose from 8.5 percent to 8.9 percent, the highest since late 1983.

The report showed that the labor market was still deteriorating, but the rate of decline was moderating, analysts said. About half of the improvement from March came in the government sector, as it hired temporary workers for preparatory work on the 2010 Census. The rest of the improvement was widely spread across the private sector.

There were indications that the industry's headlong decline is bottoming out, as the manufacturing workweek rose for the first time since July 2008, and manufacturing overtime rose for the first time since November 2007.

Investors' risk appetite was also helped by the results of the U.S. government's stress test, which showed better-than-expected picture of health of major U.S. banks. The government said 10 of the 19 largest U.S. banks must raise about 74.6 billion U.S. dollars in new capital, less than some had feared.

The euro bought 1.3622 dollars in late New York trading compared with 1.3373 dollars it bought late Thursday. The pound rose to 1.5215 dollars from 1.4996 dollars.

The dollar fell to 1.1513 Canadian dollars from 1.1740 Canadian dollars, and fell to 1.1065 Swiss francs from 1.1309 Swiss francs. It fell to 98.40 Japanese yen from 98.99 Japanese yen.

Fuji Heavy logs 70 bln yen net loss in FY 2008

TOKYO, May 8 (Xinhua) -- Fuji Heavy Industries Ltd. on Friday reported a consolidated net loss of 69.93 billion yen (706.36 million U.S. dollars) in fiscal 2008 ending March 31.

As car sales are still on the decrease amid the global financial crisis, the company further projected a loss of 55 billion yen (555.56 million dollars) in fiscal 2009.

According to Fuji Heavy, the sharp appreciation of the Japanese yen as well as the costs of releasing new cars also contributed to the company's first yearly net loss in 15 years.

Meanwhile, Fuji Heavy also predicted a loss of 40 billion yen (404.04 million dollars) in pretax loss on sales of 1.32 trillion yen (13.33 billion dollars), down by 8.7 percent on the previous year.

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