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Chinese police bust million-dollar rat-meat ring

Chinese police have broken a crime ring that passed off more than $1 million in rat and small mammal meat as mutton, authorities said, in a food safety crackdown that coincides with a bird flu outbreak and other environmental pressures.

Authorities have arrested 904 suspects since the end of January for selling and producing fake or tainted meat products, the Ministry of Public Security said in a statement posted on its website on Thursday.

During the crackdown, police discovered one suspect surnamed Wei who had used additives to spice up and sell rat, fox and mink meat at markets in Shanghai and Jiangsu province.

Police arrested 63 suspects connected to the crime ring in a case valued at more than 10 million yuan ($1.6 million) in sales since 2009.

Despite persistent efforts by police, "food safety crimes are still prominent, and new situations are emerging with new characteristics", the ministry's statement said, citing "responsible officials".

Police confiscated more than 20,000 tonnes of fake or inferior meat products after breaking up illegal food plants during the nationwide operation, the ministry said.

Food safety and environmental pollution are chronic problems in China and public anxiety over cases of fake or toxic food often spreads quickly.

In April, many consumers lost their appetite for poultry as an outbreak of the H7N9 bird flu virus spread in China. Sales dropped by 80 percent in eastern China, where the bird flu has been most prevalent, although experts stress that cooked chicken is perfectly safe.

In March, more than 16,000 rotting pigs were found floating in one of Shanghai's main water sources, triggering a public outcry. Over-crowding at pig farms was likely behind the die-off and their disposal in the Huangpu river.

The public security ministry said police had confiscated more than 15 tonnes of tainted pork in Anhui province, although as much as 60 tonnes had been sold in Anhui and Fujian provinces since mid-2012.

But it was the rodent meat in particular that people couldn't stomach, with Internet users turning to the popular microblogging site Sina Weibo to vent their outrage.

"Rats? How disgusting. Everything we eat is poison," one user wrote. – Reuters

US April jobs data to point to sluggish economy

U.S. employment growth likely picked up in April, but probably not by enough to counter other signs that suggest the economy has lost a step in recent weeks.

Nonfarm payrolls are expected to have increased by 145,000 jobs, according to a Reuters survey of economists, after braking to a nine-month low of 88,000 in March. Taken together, the job creation pace over the past two months would still be far below the average of 200,000 for the first two months of this year.

"That would be consistent with an economy that's losing growth momentum but hasn't fallen out of bed," said Millan Mulraine, a senior economist at TD Securities in New York.

Although the economy grew at a 2.5 percent annual pace in the first quarter, data on construction spending, retail sales and trade suggested it ended the period with less speed.

Factory data for April imply the loss of momentum persisted early in the second quarter, setting the stage for a replay for a third straight year of what economists have called the spring swoon.

Economists say uncertainty over the full impact of higher taxes and deep government spending cuts on already sluggish demand was making businesses reluctant to hire. A 2 percent payroll tax cut ended at the start of the year, and $85 billion in federal budget cuts went into effect on March 1.

The forecast job gains should be just enough to hold the unemployment rate at a four-year low of 7.6 percent, though the rate could even fall as older Americans retire and younger people give up the hunt for work in frustration.

The labor force participation rate - the share of working-age Americans who either have a job or are looking for one - hit a 34-year low in March.

"We need more than 3 percent growth on a sustained basis to make real inroads in reducing not only the number of those counted as unemployed, but the legions of those who are nowhere to be found in the labor force data," said Patrick O'Keefe, head of Economic Research at CohnReznick in Roseland, New Jersey.

The Labor Department will release its April employment report on Friday at 8:30 a.m. (1230 GMT).

HIGH BAR FOR FED

The continued sluggishness of job growth would likely bolster the resolve of the Federal Reserve to push forward with its efforts to spur a stronger recovery.

On Wednesday, the U.S. central bank said it would continue to buy $85 billion in bonds each month and keep on buying until the labor market outlook improved substantially. It even said it would step up purchases should the need arise.

"They have sort of tied their hand here; they set a very high bar for what constitutes a satisfactory improvement in the job market," said Robert DiClemente, chief economist at Citigroup in New York. "This number will be a reminder that we are not there yet."

Economists are divided on the impact government spending cuts may have had on employment in April. Some see a minor hit, arguing that the government has been reducing hours for workers instead of resorting to outright lay-offs.

Others, however, say there have been job losses in industries such as defense contracting. However, first-time applications for state unemployment benefits have shown no sign of a pick-up in lay-offs and rose in only one week in April.

"At the margin, the sequester is having an impact. You might see it in the hours worked rather than payroll jobs," said John Canally, an economist for LPL Financial in Boston.

While reducing hours keeps more people on the payroll, it does cut into economic growth.

The composition of job growth in April is expected to be fairly encouraging, although little change is anticipated in manufacturing employment, which fell in March for the first time since September.

Construction employment is seen snapping back after being slowed by unusually cold weather in March. That would mark an 11th straight month of gains, thanks to a recovering housing market.

Job gains in the private services sector are expected to have picked up from March's nine-month low, although the retail sector remains a wild card. Retail employment fell in March after eight straight monthly increases.

Government payrolls are expected to have dropped by about 15,000 jobs in April after falling by 7,000 in March. Most of the drag is expected to come from the U.S. Postal Service, which economists think continued to pare its workforce even after about 12,000 workers departed in March.

The report is expected to show average hourly earnings rose by 0.2 percent after being flat in March.

The length of the average workweek is expected to have held steady at a nine-month high of 34.6 hours, but government furloughs could weigh. – Reuters

Hundreds flee homes as California wildfire rages

A wind-driven wildfire raging along the California coast north of Los Angeles prompted the evacuation of hundreds of homes and a university campus on Thursday as flames engulfed several farm buildings and recreational vehicles near threatened neighborhoods.

A smaller blaze in Riverside County, 80 miles (128 km) to the east, destroyed two houses and damaged two others before firefighters halted its spread, and at least five additional wildfires were burning in Northern California.

The outbreak of brush and wildfires marked a fierce start to a fire season in California that weather forecasters predict will be worsened by a summer of high temperatures and drought throughout much of the U.S. West.

The largest of the blazes erupted about 6:30 a.m. beside the U.S. 101 freeway, less than 10 miles (16 km) inland from the Pacific coast, and quickly consumed 6,500 acres (2,630 hectares) of dry, dense chaparral and brush near the communities of Camarillo and Newbury Park, about 50 miles (80 km) north of Los Angeles.

Hot, dry Santa Ana winds fanned the so-called Springs Fire southward toward the ocean for much of the day, prompting authorities to close a stretch of the Pacific Coast Highway. Ventura County Fire Department spokesman Bill Nash said no injuries were reported.

News footage broadcast by KTLA-TV showed heavy smoke in the area and flames engulfing recreational vehicles parked near the evacuation zone. Later footage showed several farm sheds and other structures at the edge of an agricultural field going up in flames, apparently ignited by burning embers.

Fire department spokesman Tom McHale told KTLA that authorities were worried people could be exposed to toxic fumes that might be released from agricultural facilities.

'NERVE-WRACKING'

"The winds are a big factor in this firefight," he said. "Our concern is with pesticides and fumigants and things of that nature."

Ventura fire department spokeswoman Lori Ross later confirmed that a number of homes, vehicles and farm buildings had been damaged, but she had no details about the extent of property losses.

Emergency calls were placed to residents of two subdivisions near Camarillo and scattered houses along the coastal highway telling them to flee the fire zone, an evacuation encompassing 855 homes and thousands of people, Ventura County sheriff's spokesman Eric Buschow said.

Evacuations were also ordered for the California State University at Channel Islands campus, according to a bulletin posted on the fire department website.

"It was nerve-wracking," said Shannon Morris, 19, a first-year psychology major at the school, recounting the ominous sight of flames creeping over a nearby hill as she and a friend drove away from the campus in her car. "The whole sky was gray and the sun was like burning red."

Phil Gibbons, 57, a writer who works from home near the campus, said he realized the fire was close when he looked out his back window and saw heavy smoke blanketing his normally pristine view of a canyon.

"When I left, I was actually really, really frightened," said Gibbons, one of 70 evacuees at a Camarillo shelter. "I thought it was only a matter of time that the houses (in his neighborhood) would catch fire."

WATER-DROPPING AIRCRAFT

More than 500 firefighters were dispatched to battle the blaze, along with six water-dropping helicopters and several bulldozers. Airplanes equipped to drop payloads of fire-retardant chemicals were grounded by high winds and thick smoke in the area, officials said.

At Point Mugu Naval Air Station, a coastal installation south of Camarillo, all non-essential personnel on the coast south of the fire were sent home early, spokesman Vance Vasquez said, adding that the base was not in immediate danger.

Evacuation orders were lifted for some areas on Thursday afternoon as the Santa Ana winds eased and cooler offshore breezes picked up, allowing firefighters to gain 10 percent containment of the blaze.

Officials said it would be up to administrators at the university to decide whether students could return on Friday, when temperatures were expected to reach into the 90s (30s C) again, complicating efforts to fully contain the fire.

"We're not going to call this thing caught until we have a good line around it and that line can hold the conditions that are presenting at the time," Ventura County Fire Captain Mike Lindbery said.

"There's a real good chance that right after the sun goes down, we could have heavy winds blowing once again," he said.

The separate blaze east of Los Angeles in Riverside County erupted on vegetation in a roadway center divider and quickly swept across 12 acres (5 hectares) of brush, destroying two houses before firefighters managed to halt the advancing flames.

That blaze, apparently triggered by a discarded cigarette or some other hot object, was reported completely contained within hours. It destroyed five outbuildings, 10 vehicles and a parked boat, Riverside County fire spokesman Mark Annas said. – Reuters

Prosecutor in Bhutto assassination case shot dead

Gunmen on a motorcycle on Friday shot dead a prosecutor investigating the 2007 assassination of former Pakistani Prime Minister Benazir Bhutto, one of the most shocking events in the country's turbulent history.

Police sources said Chaudhry Zulfikar was shot in his car after he left home and headed to a hearing in the case, a reminder of Pakistan's instability just a week before general elections.

"He was killed by unknown gunmen. Twelve bullets were fired," said a police source.

Zulfikar was also the prosecutor investigating the 2008 attacks on India's commercial capital, Mumbai, in which 166 people were killed. India said militants based in Pakistan were behind the three-day rampage.

The attack on Zulfikar left glass and blood stains on the front seats of his car.

Security expert Amir Rana said Zulfikar was probably a marked man because he had been prosecuting militants who were jailed in connection with Bhutto's death, or other cases.

Bhutto's assassination is shrouded in mystery.

She was killed in a gun and suicide bomb attack carried out by a 15-year-old boy after an election rally in the city of Rawalpindi, weeks after she returned to Pakistan from years in self-imposed exile.

A report by a U.N. commission of inquiry released in 2010 said any credible investigation should not rule out the possibility that members of Pakistan's military and security establishment were involved.

Bhutto was a fierce critic of Pakistan's Taliban and Islamist groups that had been patronised by elements of Pakistan's military. She was deeply mistrusted by the security establishment.

Speculation has lingered that Bhutto was the victim of a plot by allies of General Pervez Musharraf, the president at the time, who did not want her to come to power.

The killing of the prosecutor comes days after a Pakistani court put Musharraf on a 14-day judicial remand for charges of failing to provide adequate security for Bhutto before her assassination.

The former army chief, who has always denied responsibility for Bhutto's death, returned to Pakistan in March after nearly four years of self-imposed exile to contest the May 11 general election. But has since been banned from politics for life. – Reuters

US rethinking arming Syrian rebels: Hagel

The US is rethinking its opposition to arming the Syrian rebels, President Barack Obama's defense chief said on Thursday, even as Obama himself signaled that no decision to deepen U.S. involvement in the conflict was imminent.

Defense Secretary Chuck Hagel cautioned that giving weapons to the forces fighting President Bashar al-Assad was only one option being considered by the United States. It carries the risk of arms finding their way into the hands of anti-American extremists among the insurgents, such as the Nusra Front.

But it may be more palatable to many in the United States than direct U.S. military intervention in the conflict, such as carving out a no-fly zone or sending in troops to secure chemical weapons.

Asked whether the Obama administration was rethinking its opposition to arming the rebels, Hagel said, "Yes."

"You look at and rethink all options. It doesn't mean you do or you will" choose them, Hagel told a Pentagon news conference.

Obama, speaking in Mexico, said the United States would "look at all options." But he also signaled no decision would be rushed.

"We want to make sure that we look before we leap and that what we're doing is actually helpful to the situation, as opposed to making it more deadly or more complex," Obama said.

Pressure on Obama to act on Syria has grown since the disclosure of U.S. intelligence that Assad's forces likely used chemical weapons on a small scale, particularly sarin gas.

The Syrian government has also mounted a string of attacks reaching from the capital, Damascus, and the central city of Homs out to the Mediterranean coast, homeland of the Alawite minority sect to which Assad himself belongs.

Forces loyal to Assad stormed the coastal village of Baida on Thursday, killing at least 50 people, including women and children, the Syrian Observatory for Human Rights said.

An Obama administration official, speaking on condition of anonymity, said re-examining the option of arming the rebels was part of a broad look at ways to hasten an end to the conflict, which has cost more than 70,000 lives and forced refugees to flee to U.S. allies Turkey and Jordan.

"Does that mean that they (arms) will be provided? No, it means we're reviewing all options to see how we can accelerate the transition in Syria," the official told Reuters.

Most Americans do not want the United States to intervene in Syria's civil war even if the government there uses chemical weapons, a Reuters/Ipsos poll showed on Wednesday.

British Defence Secretary Philip Hammond, speaking alongside Hagel, noted that his government was constrained by a European Union ban on supplying armaments to the rebels.

"Both of our nations will only do what we legally can do," Hammond said, adding his government would "look at the situation when that ban expires in a few weeks' time."

CHEMICAL WEAPONS

The Obama administration would be extremely reluctant to authorize any intervention involving a large-scale U.S. ground force, and Hagel warned of the risks of Americans being mired in a broad, regional conflict.

The Pentagon has developed plans, however, to potentially deploy troops if needed to secure Syrian chemical weapons sites.

"Any kind of boots-on-the-ground scenario like Iraq is not likely at all," the U.S. official said. – Reuters

Brent steady below $103, ECB rate cut supports

Brent crude held below $103 a barrel on Friday, retaining most of its steep gains from the previous session, when an interest rate cut by the European Central Bank boosted investors' appetite for riskier assets.

The decision came a day after the Federal Reserve recommitted to its aggressive stimulus programme, helping Brent trim losses for the week to stand down just 0.4 percent, versus a decline of more than 3 percent at the end of Wednesday.

"Europe has always been about austerity, spending cuts and raising taxes, but with this rate cut decision we see a genuine shift towards a focus on growth," said Ben Taylor, sales trader at the Sydney-based CMC Markets.

Brent crude was 25 cents lower at $102.60 a barrel by 0502 GMT, while U.S. crude for June delivery was down 28 cents a barrel at $93.70 a barrel.

Both contracts jumped around 3 percent overnight in their biggest single-day rally in almost six months.

Oil prices got a shot in the arm on Thursday after the ECB cut interest rates to record lows and a report showed U.S. jobless claims dropped sharply to a five-year low, indicating the job market was still healing in the world's largest economy and top oil consumer.

The ECB, which lowered its main rate by a quarter percentage point to a record low 0.50 percent, said it would prime banks with as much liquidity as they needed until at least July 2014 and look at ways to boost lending to smaller companies, which are the lifeblood of Europe's economies but have been starved of credit in many countries.

"This will likely encourage banks to lend and it will benefit small- and medium enterprises. If they expand and then hire, it will go towards bringing down the unemployment number," CMC Markets' Taylor said.

Share markets across Asia were mostly higher, with the MSCI's broadest index of Asia-Pacific shares outside Japan rising 0.4 percent.

In commodities, copper extended gains and was nearing the $7,000-a-tonne price critical to market bulls. It rose 2.2 percent to 6,996.25, continuing to recoup a chunk of its losses earlier this week.

"In conjunction with recent moves from the Bank of Japan and US Federal Reserve, ultra-accommodate G3 policy looks set to remain in place for some time, which should be supportive for commodities," ANZ Bank said in a research note to clients.

With the ECB and Fed decisions out of the way, investors are now turning their attention to key U.S. nonfarm payrolls data expected later in the day.

A Reuters poll showed that U.S. nonfarm payrolls may have risen by 145,000 in April after hitting a nine-month low of 88,000 in March, but a lower-than-forecast increase in private hiring from Wednesday's ADP National Employment Report raises the risk of a smaller number.

"This is going to be key for the week, if we get a really strong number, then we are going to see even further momentum on oil," Taylor said.

However, weak manufacturing activity in the United States and China is still clouding the outlook for oil demand from the top two consumers.

"I think the PMIs which we've seen this week still remind us that in China we need to see further evidence of stabilisation, and in the United States we want to see signs that are a little less stop-start," Taylor said. – Reuters

Qatar Foundation to buy 5pc Airtel stake for $1.26bn

India’s Bharti Airtel, a leading provider of mobile and Internet services, will sell a 5 percent stake in the company to Qatar Foundation Endowment for $1.26 billion to strengthen its capital structure and fund future growth plans.

The announcement sent its shares up nearly 5 percent.

Bharti, the world's fourth-biggest mobile phone company by customers, will issue 199.9 million new shares to Qatar Foundation Endowment at 340 rupees ($6.35) apiece, or a 7.3 percent premium to the stock's last close, it said on Friday.

Qatar Foundation Endowment is the investment vehicle for Qatar Foundation, a non-profit organisation wholly-owned by the Gulf state's royal family.

Bharti shares rose as much as 4.7 percent after the news before paring some gains.

Bharti, controlled by billionaire Sunil Mittal and also nearly a third owned by Southeast Asia's top phone carrier SingTel had $11.7 billion of net debt, or about 2.5 times its operating profit, as of end-March.

While senior company executives have previously said they were comfortable with a leverage ratio of less than three times, Bharti faces more than $1 billion in government fees and also will need to buy airwaves in India to feed its networks in some key cities.

The deal "should help ease the debt burden and improve investor confidence," said Karan Mittal, a telecommunications analyst at ICICI Direct in Mumbai.

The company recently raised $1.5 billion through overseas bonds. Goldman Sachs advised Qatar Foundation Endowment on the Qatar deal. – Reuters