U.S. economy grows 2.6%

WASHINGTON (AFP): The U.S. economy grew 2.6 percent in the first quarter, the government said yesterday.

The moderate increase in the gross domestic product followed a seven percent jump in the final quarter of 1993.

Most analysts had expected a stronger gain of 3.2 percent.

The Commerce Department's initial estimate of first-quarter GDP, the total of all goods and services produced in the United States, reflected declines in net exports and a slowdown in housing and business construction attributed to harsh winter weather and the California earthquake in January.

Consumer spending, which accounts for roughly two-thirds of U.S. economic activity, also declined after a sharp increase during the end-of-the-year holidays.

Orders to U.S. factories for durable goods rose 0.4 percent in March, compared to a revised 1.9 percent decline in February.

Excluding defense orders, durable goods orders rose 1.1 percent in March.

Durable goods orders in March totaled a seasonally adjusted US$146.4 billion, compared to $145.8 billion in the previous month.

Dollar mixed in Europe

LONDON (UPI): The dollar was mixed against the major European currencies yesterday, trading in narrow ranges as the German Bundesbank council held its regular fortnightly meeting.

In Frankfurt, the dollar opened at 1.6738, up from 1.6730 at the previous close.

In Zurich, the dollar opened at 1.4300 Swiss francs, up from the previous close at 1.4295.

In London, the pound opened at US$1.5045, down from the previous close of $1.5067.

In Paris, the dollar opened at 5.7477 French francs, down from the previous close at 5.7513.

In Tokyo, the dollar closed at 102.38 yen, down from 102.68 at the previous close.

In Singapore, the dollar closed at S$1.5552, down from S$1.5555 at the previous close.

In Hong Kong, the dollar closed at HK$7.7250, down from HK$7.7258 at the previous close.

Gold opened at $373.75 in Zurich, down from $374.00 at the previous close, while in London it opened at $373.75, down from the previous close at $374.25. It closed at $373.55 in Hong Kong, down from the previous close at $374.45.

Silver opened in Zurich at $5.17, unchanged from the previous close, and in London it opened at $5.15, down from the previous close at $5.18.

Marannu hotels acquired

JAKARTA (JP): PT Indobuilco, the owner of the Jakarta Hilton International Hotel, has taken over five hotels in South Sulawesi from the Marannu Group.

Indobuilco's president, Pontjo Sutowo told reporters here that the group operates about 500 rooms in the five star-rated hotels, including Marannu Tower, Marannu Garden, Marannu Wisata and Pavilion in Ujungpandang, the capital of South Sulawesi, and Marannu City in Tana Toraja, a highland area near the Ujungpandang.

He said that Marannu Group, which is run by a noted businessman Andi Sose, had a "technical reason" forcing the group to sell the hotels.

Marannu Group also operates other businesses, including shipping, finance and transportation service.(icn)

RP to raise stock tax

MANILA (Reuter): The Philippine Congress has approved legislation increasing the tax on stock transactions and imposing taxes on initial public offerings of shares, legislators said yesterday.

The stock transaction tax will be increased to 3/8 of one percent in the first year from the current 1/4 of one percent. In the second year, the tax will be raised to 0.5 percent.

The bill, one of several sought by the International Monetary Fund (IMF) before it approves a US$650 million economic program, will be sent to President Fidel Ramos for approval before the end of the week.

"This (tax) will improve the revenue base of the government," Senator Ernesto Herrera told reporters. He said the government will be able to raise 800 million pesos ($29.6 million) annually from the tax.

Congress also approved legislation imposing taxes on the initial public offering of shares in the local market. For closed companies going public and unloading 33-1/3 percent of their shares, the tax would be four percent of gross sales.

For firms selling 33-1/3 to 50 percent of their shares, the tax would reach 2.0 percent. For firms selling over 50 percent of their shares, it would be one percent of sales.

Japan housing starts falls

TOKYO (AFP): Japan's housing starts in March dropped 0.7 percent from a year earlier to 118,852 units, the first decline in 22 months, the Construction Ministry said yesterday.

The ministry said starts of rental accommodation dropped 18.9 percent for the second consecutive month, while those with loans from private financial institutions went down 27.4 percent for the 12th straight month.

Construction of public-funded housing also fell 0.7 percent for the first time in 29 months, they said.

Starts on owner-occupied houses moved up 2.9 percent, rising for 10 months in a row and those on housing units for sale grew 40.4 percent, rising for the 11th consecutive month.

Housing starts rose 6.3 percent in February.

Saudis to sell light crude

DUBAI (Reuter): Saudi Arabia expects to start exporting its new super light crude in January 1995, officials at the state- owned oil firm Saudi Aramco said.

The crude, from the Hawtah field south of Riyadh, is sulfur- free with an API gravity of 44 to 50 degrees. Production testing will begin this year with a target output of 150,000 barrels per day in early 1995, they added.

Aramco plans to keep its crude oil output at 8.0 million bpd -- Saudi Arabia's OPEC quota for supply to the oil markets, officials said. A plan to mothball some capacity will still allow Aramco to go to its full 10 million bpd in 90 days if needed, they added.

Rubber prices firm

SINGAPORE (AFP): Singapore rubber futures prices firmed yesterday despite quiet trading as short-covering activity ahead of the week-long holidays in Japan created some buying interest.

"The Japanese markets will be closed for the Golden Week holidays next week and this saw some short-covering activity here," a dealer said.

He added that prices in the Japanese markets were also slightly firmer and the Singapore market reacted with some short- covering buying late in the day.

The morning session was extremely quiet.

Although the holidays in Japan are only for three days, from Tuesday to Thursday, very little activity can be expected in the two trading days next week, the dealer said, adding that the holiday mood had already set in at the end of Thursday's trading.

At 09:45 GMT Basis June 1 RSS was quoted at 151.00 Singapore cents, RSS 3 at 95.25 U.S. cents and TSR 20 at 163.00 Singapore cents.

S'pore exports up

SINGAPORE (AFP): Singapore's exports grew strongly in March, fueled by rising sales of computer, television and video components, to reach S$11.4 billion (US$7.2 billion), the Trade Development Board (TDB) said yesterday.

Figures released by the TDB show non-oil exports rising 13.4 percent on a three-month moving average basis to almost S$6 billion, while oil exports slumped 11.6 percent to S$1.2 billion.

Re-exports from Singapore's entrepot trade rose 19.5 percent to S$4.2 billion.

Imports expanded by a slower 9.6 percent to S$12.6 billion, but large enough to keep the overall trade balance in the red by some S$1.1 billion.

Total trade at S$24 billion in March was S$2 billion up on the same month a year earlier.