www.cbc.ca 03:05 PM EST Mar 20

TORONTO (CP) - With the zero-hour for a war in Iraq approaching, the closely watched Dow average of blue-chip stocks rose Wednesday to close up for a sixth session in a row - something that hasn't happened since August 2000.

Most North American stock markets and gained on reports that U.S. planes attacked several artillery batteries in southern Iraq. Hopes for a short war also fired up the U.S. dollar, in turn driving the Canadian currency lower by 0.37 of a cent to 67.45 cents US.

As the greenback rose, the euro fell to $1.0562 US, down from $1.0621.

But generally the tone on stock markets Wednesday was of caution ahead of the expiry of the U.S. ultimatum to Saddam Hussein, even as U.S. forces began moving through the Kuwaiti desert towards Iraq.

In New York, the Dow industrial average gained 71.22 points to 8,265.45. The Dow has racked up more than 700 points in the last six sessions as investors bet any war will be short.

"It has sort of slowed down in intensity from what we've seen in the last couple of days, but the equity markets are proving remarkably resilient here," said Scott Kinnear, economist with MMS in Toronto.

Toronto's S&P/TSX composite index moved 14.87 points higher to 6,453.48. The junior TSX Venture Exchange was up 1.02 points at 1,063.02.

The Nasdaq lost 3.47 points to 1,397.08 while the S&P 500 was ahead 7.57 at 874.02.

Generally, stock markets have been driven higher since the middle of last week as investors looked to the rally that followed the start of the 1991 Persian Gulf War and hoped that history would repeat itself.

"The general feeling out there is that there will be a quick war so you don't necessarily want to wait for the start of the war because by that time it will be too late," Kinnear said.

But there are plenty of reasons for caution, including the possibility of torched oil fields, use of biological weapons and terrorist attacks.

In corporate news, shares in DuPont Canada soared $4.35 to $21.59 after its U.S. parent offered $1.4 billion to shareholders to take the firm private. The two companies announced that DuPont will offer $21 a share to buy the 24 per cent of DuPont Canada stock it doesn't already own.

Softness on the Nasdaq came after software maker Oracle Corp. reported a cautious outlook for a recovery in technology spending late Tuesday.

The company posted a 12 per cent rise in fiscal third-quarter profit and said revenue grew modestly, helped by growth in sales of software upgrades to existing customers.

But the company said revenue from new software licences and sales of its flagship database product line each fell four per cent. Its shares were down 94 cents to $11.31 US.

Lowered fears about a shortage of oil as a result of a new war in the Persian Gulf took crude prices beneath $30 US a barrel. Futures lost another $1.79 to $29.88 US a barrel on top of Tuesday's $3.25 US plunge.

While U.S. crude inventories remain uncomfortably low, OPEC producers other than Iraq and strife-torn Venezuela have been increasing production for weeks.

Much of that oil is now in storage or in tankers on the high seas, say oil analysts.

www.duluthsuperior.com Posted on Wed, Mar. 19, 2003
ROB MAADDI Associated Press

CLEARWATER, Fla. AP) - Surrounded by a group of Latin teammates, Bobby Abreu sits at his locker, cracks jokes and shares a few laughs.

Popular among the Spanish-speaking players on the Philadelphia Phillies, Abreu isn't just another funny guy. The 28-year-old right fielder is perhaps the most complete player on the Phillies, and one of the most underrated stars in the majors.

"I think Bobby is going to have a monster year," Phillies manager Larry Bowa said. "If everything falls through, he can put up nasty numbers."

Abreu arrived one day late to spring training because of civil unrest in his native Venezuela. He also showed up with a few extra pounds and a bit more muscle - he has bigger biceps, but a larger gut.

The added strength has allowed him to hit some balls a little farther than usual.

"There's no doubt he's stronger," Bowa said. "He's hitting balls to left field like he's a right-handed pull hitter."

Abreu attributes his new upper body to working out in the offseason. Because of the problems in Venezuela, Abreu didn't play baseball in the winter for the first time since reaching the majors in 1996.

But he certainly hasn't shown any signs of being rusty. Abreu is hitting .289 (13-for (45)- with four homers, three doubles and 10 RBIs this spring. He didn't make the long trip to Fort Myers for Wednesday's game against Minnesota.

Told that Bowa has high expectations for him, Abreu flashed his familiar smile.

"Really?" he said. "That's nice."

Abreu never has played in an All-Star Game, but has a .308 career batting average that is 15th best among active players with 3,000 or more plate appearances. Last year, he hit .308 with 50 doubles, 20 homers, 85 RBIs, 104 walks and 31 steals.

"I'm getting more experience in the game," Abreu said. "When you get more mature, that's when you start putting up big numbers."

Abreu hit a career-best .335 in his second full season in 1998. He had career-highs with 31 homers and 36 steals in 2001, becoming the first player in franchise history to join the 30-30 club.

Bowa thinks Abreu has the potential to hit at least .330 with more than 30 homers in the same season.

"Bobby is capable of doing whatever Bobby wants to do," Bowa said. "He's got a great future ahead of him. He hasn't even reached his peak."

Abreu should be helped by the addition of Jim Thome and the continued improvement of Pat Burrell. The threesome gives the Phillies a potent 3-4-5 punch in the middle of the batting order.

Bowa has experimented with batting Thome third and Abreu fifth and vice-versa. Abreu has hit No. 3 most of his career, but said he's comfortable in either spot.

"Those two guys are going to do some damage," Abreu said. "I just want to do my job."

Abreu came to the Phillies from Tampa Bay in 1997. He played parts of two seasons with Houston, was selected in the expansion draft by the Devil Rays and was traded to Philadelphia for shortstop Kevin Stocker, who is out of baseball.

In five seasons with the Phillies, Abreu has hit .300 four times, and has averaged 30 steals over the last four years.

"Bobby does some amazing things," Bowa said.

Notes: Right-handed reliever Turk Wendell left the team for at least one day for personal reasons. Wendell, who missed all of last season after having elbow surgery, has temporarily been shut down because of a sore elbow. ... 2B Placido Polanco is expected to return to the lineup Thursday after missing five of the last six games with a groin injury.

ACM Income Fund Releases Monthly Portfolio Update

2003-03-19 16:43 ET - News Release

NEW YORK, March 19 /PRNewswire-FirstCall/ -- ACM Income Fund, Inc. (the "Fund") today released its monthly portfolio update as of February 28, 2003.

www.heraldtribune.com By H. JOSEF HEBERT Associated Press Writer

As the United States and Iraq move closer to war, oil markets seemed to be taking it all in stride. Global crude oil stocks are growing, prices declining and some analysts are talking cautiously of a possible oil glut on the horizon. Lower energy prices probably would follow.

That is, energy experts warned, if a war in Iraq doesn't drag on and Iraqi leader Saddam Hussein doesn't torch his oil fields or, in the worst case, finds a way to disrupt other Persian Gulf supplies.

For now, the markets are betting those things won't happen and that the war will be a swift one.

Oil prices dropped by more than $3 a barrel, or about 9 percent, on Tuesday, falling to their lowest in more than two months as traders believed there is enough crude in the system to make up for Iraq's lost production if war erupts.

Oil traders "are beginning .. to realize there's a bit of a glut of oil around," said Leo Drollas, chief economist of the London-based Center for Global Energy Studies.

But that oil has yet to reach the U.S. markets.

The Energy Department said Wednesday U.S. crude oil stocks remained uncomfortably low at 270 million barrels, roughly where inventories have been most of this year and at the minimum industry says is needed for smooth refinery operation. The U.S. stocks increased only slightly over a week ago.

Crude inventories have consistently been 300,000 to 400,000 barrels below a year ago, said Doug MacIntyre, an oil analyst for the Energy Information Administration. Imports also have been down from previous levels, although OPEC producers other than Iraq and strife-torn Venezuela have been pumping more oil for weeks.

The low U.S. inventories reflect transportation delays, but also reluctance by refiners to buy oil when the price has been $35 to $37 a barrel, analysts said.

Much of that oil is now in storage in the Persian Gulf or in tankers on the high seas, say oil analysts. Saudi Arabia is believed to have as much as 50 million barrels in storage in the country and more en route to other storage facilities. That's enough to replace Iraq's 1.5 million to 2 million barrels a day for about a month.

Larry Goldstein, president of the private Petroleum Industry Research Foundation, said the markets also have been calmed because the Bush administration has made clear that it's ready to use some of the 600 million barrels in the Strategic Petroleum Reserve to counter shortages.

Rep. Billy Tauzin, R-La., chairman of the House Energy and Commerce Committee, said this week he is convinced the reserve is capable of providing oil quickly on orders from President Bush. It has shifted "from the fill mode to the flow mode," Tauzin said.

Still, there remains some trepidation among oil traders and analysts should war in Iraq last a while. Crude oil prices are likely to remain volatile in the months to come, they cautioned.

"This thing could go right back up," said Tom Bentz, an analyst at BNP Paribas in New York, suggesting prices could rebound once fighting erupts. "We're still vulnerable because inventories are tight."

When prices jumped in the weeks before the Gulf War, oil inventories already were high. That helped cushion the impact on prices, which jumped briefly to more than $40 a barrel and then declined rapidly when it became clear that the war would be settled quickly.

The biggest fear in the market is that oil facilities in other Middle Eastern countries, such as Kuwait or Saudi Arabia, could be attacked - a scenario that would cause oil prices to shoot higher very quickly, said Fadel Gheit, senior oil analyst at Fahnestock & Co. in New York.

Short of that happening, there is plenty of oil, Gheit said, and the recent price declines make clear that for the time being the "war premium" has disappeared. He said prices could drop an additional $5 a barrel in the coming days.

Energy experts say a glut could result if war in Iraq doesn't drag on and Iraqi leader Saddam Hussein doesn't torch his oil fields or disrupt other Persian Gulf suppliers.

For now, the markets are betting those things won't happen and that the war will be a short one.

Associated Press Writer Brad Foss in New York contributed to this report.

www.thestatesman.net By SAUBHIK CHAKRABARTI

Jaswant Singh’s budget bets on consumer spending and private investment to deliver growth. Excise duty reductions on a raft of products from cars to umbrellas, abolition of dividend tax for shareholders and return of some small change from the taxman — the abolition of surcharge and the increase in standard deduction — are aimed at boosting the first. The second depends on leveraging around Rs 2,000 crore public investment on infrastructure to attract more than Rs 50,000 crore in private investment and retaining the tax breaks on housing loans, thus helping the construction industry. Singh should have added to this by giving a big boost to agriculture. Minus the impetus from farm sector capital formation, it is all the more important consumer and entrepreneurial spirits, raised by the budget, be sustained over a period. Will oil price, thrown out of gear by an Iraq war, spoil the planned party?

Supply & demand The answer is a little more complicated than suggested by the scenario of poor, oil-importing India at the mercy of American dogs of war. The possible impact of a war-led oil shock can be analysed in two components. First, the supply and demand scenarios globally. Second, the structure of India’s oil economy. Globally, the supply situation is such that OPEC countries can make up for Iraq’s oil, which will be unavailable for the duration of the war and sometime after it. OPEC is, however, not the force it used to be and should the war affect, say, Kuwait’s supply, the cartel may not be able to compensate for the loss. Oil watchers also point out two oil producing non-West Asian countries, Nigeria and Venezuela, are politically not in the most stable of conditions. Nigeria’s return to some sort of democracy after years of misrule by Sani Abacha will be tested next month in general elections. Venezuela suffered a huge popular protest against President Hugo Chavez’s attempts to reform the economy and oil supplies were disrupted. If the Iraq war gets messy and if Nigerian and Venezuelan politics becomes too exciting, a supply problem may arise. Especially because unlike a decade ago, when George Bush senior, was playing the cowboy in West Asia, global oil companies do not hold too much in reserves, a result of their cutting costs. On the demand side, high seasonal (winter heating) requirements in the northern hemisphere had counteracted weak industrial demand. Had George Bush attacked Iraq when he originally wanted to — late December 2002, early January 2003 — the winter demand for oil would have had a significant impact on prices. France, Germany, Russia and peace marchers everywhere have however delayed Bush. And in the rich industrialised north, winter is giving way to spring. In April and May there is always a big dip in oil demand. That plus the fact that industrial activity in the big economies is yet to pick up, points to relatively less demand side pressure on prices.

India’s oil economy It is possible to argue, therefore, that unless Saddam Hussein decides to go out in a blaze —blowing up Kuwaiti or even Saudi oil fields, for example — and Nigeria and Venezuela are singed by their own home grown fires, the supply demand situation globally may not produce a severe price shock. But remember all three parts of the worst-case scenario are within the range of possibilities. India, however, imports almost 70 per cent of its oil. So, even a modest jump in prices for a relatively short period is something to reckon with. In fact, by the import ratio criterion, India can be said to be distinctly worse off now than during the Gulf War in 1991, when less than a third of domestic oil consumption was imported. But three factors mitigate this. Just before the 1991 Gulf War, India’s paltry foreign exchange reserves would have bought less than half a year’s oil imports, at the then levels of global prices and domestic demand. Now, record levels of reserves — $ 75 billion— can buy four years of oil imports. That, even with an oil price spike, is a big cushion. The second comforting factor is domestic inventory management by the government. India, like many other countries, notably the US, has a better-managed system than a decade back. It is generally thought that the government has an oil inventory large enough to last 45 days of domestic consumption. Third, the oil consumption pattern in India acts and will act as a shock absorber. In rich Western countries, oil is typically the principal fuel meeting the energy needs of the manufacturing sector. In India, more than 50 per cent of industrial energy usage is coal-fired. The share of oil is less than 35 per cent. Transport outruns manufacturing by a long way as the biggest consumer of petroleum products. An oil price hike is therefore felt primarily through higher transportation costs and not through industrial costs going haywire. Economic dislocation is therefore less severe. An added layer on this structural insulation comes from the downturn in economic activity (industrial slump affects the transport sector). Total oil consumption in 2001-2002 was less than that in 2000-2001. As industry has shown signs of revival in 2002-2003, fuel consumption has picked up. But the oil economy is nowhere near breaking point. Hence Indian industry should not really be panicking at this stage and should survive a relatively short war more or less unscathed. Investor sentiment, accordingly, may not take a big beating.

Fuel prices The consumer? He is not really interested in Venezuelan politics, Exxon’s supply strategy and India’s sectoral energy consumption index. The “real” question for him — the one that will determine whether he buys the stuff Singh wants him to buy — is whether retail fuel prices go up to levels where life becomes very difficult. Not if Ram Naik, the oil minister can help it. Naik has already demonstrated that an interventionist minister can make nonsense out of price reform strategies. After the dismantling of the administered pricing regime — jargon for the government fixing prices — Indian oil companies were supposed to be able to fix domestic prices according to import prices. But Naik hasn’t allowed that so far and will not allow it even more as election priorities become sharper for the government. Therefore, domestic price adjustment to war-led global price hikes will be significantly less than proportional as long as war effects are moderate. This will reduce the profitability of oil refineries, which will have to buy at higher import prices but sell at Naik-determined rates. But they are public sector companies, and so will have to lump it. The other government price intervention, less likely but possible in case of significant hardening of oil prices, is that oil import duties are lowered, thus bringing down domestic prices. Naik has been arguing for this and the finance ministry has been resisting. But Singh may give in if popular discontent on the eve of assembly elections becomes a factor. All told, prospects for Jaswant Singh and his compatriots whom he wants to spend and invest are not scary. Now, if only Bush does not make a Texan bull’s breakfast of his silly war!

The author is Resident Editor, The Statesman, New Delhi