The Chinese brokerage firm Haitong Securities has raised $1.7 billion through the sale of shares in Hong Kong, the largest public offering in the world so far this year, according to a person with direct knowledge of the matter.

The firm, which already is publicly traded in Shanghai, sold approximately 1.23 billion shares at 10.60 Hong Kong dollars, or $1.37, each, according to the term sheet obtained by DealBook on Friday.

The pricing of Haitong’s Hong Kong sale represents a 16.6 percent discount to the firm’s closing share price in Shanghai on Friday. It also was at the bottom end of firm’s price range of 10.60 Hong Kong dollars to 11.18 Hong Kong dollars.

The company’s stock will start trading in Hong Kong next Friday. The firm is expected to use the money to expand its brokerage business in China.

Haitong’s listing comes at a difficult time for the broader Chinese economy, whose growth slowed to 8.1 percent in the first three months of the year. It was the fifth-consecutive slowdown in the country’s quarterly growth, as fears mount that the Chinese economy will not be able to maintain its rapid expansion.

Other companies to raise money in the public markets in 2012 include the Dutch cable operator Ziggo and the Swiss trade and marketing company DKSH, which raised a combined $2 billion dollars earlier this year.

Allison Transmissions, a commercial vehicle transmission maker based in Indianapolis also raised $690 million in March.

Haitong and JPMorgan Chase were the joint underwriters of the offering. The firms, along with Credit Suisse, Deutsche Bank, Citigroup and UBS, also were global coordinators for the listing.

WASHINGTON — High earners who are worried that this year’s Tax Day will be the last one before their rates rise have more than just the White House and Washington to blame. They can also look to two academically revered, if publicly obscure, left-leaning French economists whose work is the subtext for the battle over tax fairness.

Emmanuel Saez and Thomas Piketty have spent the last decade tracking the incomes of the poor, the middle class and the rich in countries across the world. More than anything else, their work shows that the top earners in the United States have taken a bigger and bigger share of overall income over the last three decades, with inequality nearly as acute as it was before the Great Depression.

Known in Washington and the economics profession by the of-course-you-know shorthand “Piketty-Saez,” the two have been denounced on the editorial page of The Wall Street Journal and won mention in White House budget documents.

Mr. Saez, a professor at the University of California, Berkeley, has won the John Bates Clark Medal, an economic laurel considered second only to the Nobel, as well as a MacArthur Fellowship grant. Mr. Piketty, 40, of the Paris School of Economics, has won Le Monde’s prize for best young economist, among other awards.

Both admire, even adore, the United States, they say, for its entrepreneurial drive, innovative spirit and, not least, its academic excellence: the two met while re-searchers in Cambridge, Mass. But both also express bewilderment over the current conversation about whether the wealthy, who have taken most of America’s income gains over the last 30 years, should be paying higher taxes.

“The United States is getting accustomed to a completely crazy level of inequality,” Mr. Piketty said, with a degree of wonder. “People say that reducing inequality is radical. I think that tolerating the level of inequality the United States tolerates is radical.”

As much as Mr. Piketty’s and Mr. Saez’s work has informed the national debate over earnings and fairness, their proposed corrective remains far outside the bounds of polite political conversation: much, much higher top marginal tax rates on the rich, up to 50 percent, or 70 percent or even 90 percent, from the current top rate of 35 percent.

The two economists argue that even Democrats’ boldest plan to increase taxes on the wealthy — the Buffett Rule, a 30 percent minimum tax on earnings over $1 million — would do little to reverse the rich’s gains. Many of the Republican tax proposals on the table might increase income inequality, at least in the short term, according to William G. Gale of the Tax Policy Center and many other left-leaning and centrist economists.

Conservatives respond that high tax rates would stifle economic growth, at a minimum, and cause some businesses and high-income workers to flee to other countries. When top American tax rates were much higher, from the 1940s through the 1970s, businesses could not relocate as easily as they can now, say critics of Mr. Piketty and Mr. Saez.

“I materially disagree with the idea you can raise a marginal tax rate to 70 percent and not have an impact on economic growth,” said Ike Brannon, an economist at the American Action Forum. “It’s absurd on its face.”

But Mr. Piketty and Mr. Saez argue that history is on their side: Many countries have higher tax rates — and the United States has had higher tax rates — without stifling growth or encouraging the concentration of income in the hands of the very rich.

“In a way, the United States is becoming like Old Europe, which is very strange in historical perspective,” Mr. Piketty said. “The United States used to be very egalitarian, not just in spirit but in actuality. Inequality of wealth and income used to be much larger in France. And very high taxes on the very rich — that was invented in the United States,” he said.

Mr. Saez added, “Absent drastic policy changes, I doubt that income inequality will decline on its own.”

The two economists’ project of mapping income inequality started two decades ago, when Mr. Saez was teaching at Harvard and Mr. Piketty teaching down the road at the Massachusetts Institute of Technology.

Their innovation was to measure American income inequality historically. Existing data went back only to the 1970s. Tedious archival research at the Internal Revenue Service allowed them to stretch the data all the way back to 1913.

Once they had collected the data, the computation was easy. They figured out the benchmark for various income levels — the top 10 percent, top 1 percent and top 0.1 percent of earners, for instance — and calculated what share of income each group took each year.

What they found startled them. As in other industrially advanced countries, income inequality in the United States fell after World War II, a period that economic historians call the “Great Compression,” and remained stable through much of the 1970s.

But then inequality started increasing again, with the top 1 percent of earners drawing a bigger and bigger share of overall income. Their graph showing the trend became well-known: a deep U, with inequality as acute today as it was just before the depression.

When they first published their work, income inequality was mostly off the political radar screen, thanks to the 1990s boom, Mr. Saez said.

“Growing inequality was not perceived to be an issue because the economy was growing fast and even the incomes of the 99 percent were growing significantly,” he said.

But the deep downturn of the last few years, and Mr. Obama’s election, brought the issue back to the fore. Peter R. Orszag, the former Obama budget director, has said the Piketty-Saez work “helped to point the way for the administration in its pledge to rebalance the tax code.”

Now living many time zones apart, Mr. Piketty and Mr. Saez update their work with frequent e-mails, Skype conversations and data-sharing through Dropbox.

By ANNIE LOWREY NYT

(Reuters) – Molson Coors Brewing Co (TAP.N) said it will buy brewer StarBev from private equity fund CVC Capital Partners CVC.UL for 2.65 billion euros ($3.52 billion) to expand in central and eastern European beer markets.

“The acquisition of StarBev fits squarely into Molson Coors’ strategy to increase our portfolio of premium brands and deepen our reach into growth markets around the world,” Molson Coors’ Chief Executive Peter Swinburn said in a statement.

StarBev, which owns Czech lager Staropramen, will be run as a separate business unit within Molson Coors after the deal closes.

Molson Coors, whose business is concentrated in the mature markets of Canada, Britain and the United States, expects the deal to add to itsearnings in the first full year of operations.

CVC, which bought StarBev in 2009, put the business up for sale after approaches from a number of brewers. Media reports had speculated that the approaches could have come from Japanese brewer Asahi (2502.T), Carlsberg (CARLb.CO), SABMiller (SAB.L) and Heineken (HEIN.AS).

Molson Coors, which brews Molson Canadian, Carling and Coors Light beers, was advised by Morgan Stanley & Co. Nomura International was the adviser for StarBev.

($1 = 0.7518 euros)

The downturn in Europe’s periphery members has spread to the core countries of Germany and France, according to purchasing managers’ indexes (PMIs) for March. The outlook is grim as new orders fell across the region for the tenth month.

But while still far from robust, factory activity strengthened in China, South Korea and Taiwan, three of the Asia’s leading exporters, as both export and domestic demand firmed.

“We are probably through the weakest for the global backdrop in terms of the major economies already, but they are now coming out at different paces,” said Jeavon Lolay, head of global research at Lloyds Banking Group.

“Asia is going to lead the global economy with the United States not too far behind, leading the developed economies, but Europe will be the laggard.”.

Data due later should show conditions improved in the United States, the world’s biggest economy. The Institute of Supply Management manufacturing Purchasing Managers’ Index (PMI) is expected to rebound slightly to 53.0 in March from February’s 52.4.

Markit’s Eurozone Manufacturing PMI dropped to 47.7 last month from 49.0 in February, in line with a preliminary reading. It has now been below the 50 mark that divides growth from contraction since August.

Earlier data from Germany, Europe’s largest economy, showed its manufacturing sector contracted last month and it was a similar story in neighboring France.

In Spain, struggling to implement singeing austerity measures demanded by the European Union to meet tough deficit targets, the sector contracted for the 11th month. Manufacturing in Italyshrank for an eighth month.

The economic slump will make it even harder for the 17-nation euro zone to overcome its debt crisis as it will depress tax revenues and hurt consumer spending.

Periphery countries have borne the brunt of the sharp downturn as their own austerity measures continue to hamper a return to growth, particularly Greece where the sharp decline in manufacturing continued last month.

“The euro zone economy remains extremely sluggish in Q1. Despite the ECB accommodative policy and efforts to boost confidence and liquidity conditions, the effects on the real economy have not materialized yet,” said Annalisa Piazza at Newedge Strategy.

Joblessness in the euro zone reached its highest in almost 15 years in February with more than 17 million people, or 10.8 percent, out of work, highlighting the human cost of the bloc’s debt crisis and governments’ struggle to overcome it.

In an effort to stimulate growth and boost liquidity, the European Central Bank has cut its main refinancing rate to a record low of 1.0 percent and pumped more than 1 trillion euros into the banking system. But is now expected to adopt a wait-and-see approach.

Across the channel, British manufacturing activity expanded at its fastest pace in 10 months in March, driven by a pick-up in new orders and increasing the chance that Britain’s economy grew in the first three months of 2012 and avoided a recession.

SINK OR SWIM

Asia’s economic fate remains closely tied to that of its export customers in the U.S. and Europe. Demand there still looks sluggish, even though the euro zone debt crisis poses less of an immediate threat to global economic stability and U.S. data has shown a bit more bounce.

The brighter Asian figures, released on Sunday and Monday, still suggested economic growth slowed in the first quarter of 2012. China appeared to be headed for its weakest quarter since early 2009, at the depths of the global financial crisis.

China’s official Purchasing Managers’ Index (PMI) hit an 11-month high with a stronger-than-expected reading but a separate private survey by HSBC, which focuses more on smaller factories than the large state-owned enterprises captured in the official data, painted a gloomier picture.

“The upside surprise in China’s manufacturing PMI is welcome, and should help quell excessive fears of a “hard landing” in China,” said Vishnu Varathan, an economist with Mizuho in Singapore.

“But equally, we should not be lulled into thinking that China has turned a corner either. Global conditions continue to be highly uncertain notwithstanding the stabilization in Europe and ‘green shoots’ in the U.S.”

HSBC’s PMI for South Korea edged up to a one-year high in March and in Taiwan, the figures showed a second straight month of improving business conditions.

But that wasn’t enough to get economists cheering.

“Don’t get carried away,” said Ronald Man, an economist with HSBC in Hong Kong who follows South Korea. “Further upward momentum requires expectations of higher new orders to materialize.”

In contrast to the rest of the region, factory activity in India faltered in March. Expansion in Asia’s third-largest economy slowed for a third straight month as growth in new orders eased and the cost for raw materials showed no signs of falling.

Adding to India’s worries, while growth is expected slow, the latest figures indicate a pickup in inflation which would make matters dicey for the Reserve Bank of India (RBI), which has often been criticized for being behind the curve.

Serbia and Lithuania are vying for the presidency of the 193-nation U.N. General Assembly. The 12-month post involves chairing the annual gathering of world leaders in New York in September and other U.N. events.

But the assembly has no real power. Unlike the 15-nation Security Council, which can issue legally binding resolutions and authorize sanctions or military interventions, the assembly’s decisions are recommendations with no legal force.

Still, Lithuanian U.N. Ambassador Dalius Cekuolis and Serbian Foreign Minister Vuk Jeremic both want the job, which is currently held by Qatar’s U.N. ambassador, Nassir Abdulaziz al-Nasser. If neither candidate withdraws, the two will face off in a rare secret-ballot General Assembly vote in June.

Traditionally, the presidency of the General Assembly, which diplomats usually refer to by the initials “PGA,” rotates between the five regional groups of U.N. member states. In 2012/2013, it is the Eastern European Group’s turn to hold it.

In a conversation with a small group of reporters in New York earlier this month, Cekuolis and Lithuanian Foreign Minister Audronius Azubalis described their annoyance with Serbia seeking the post, which they have been eyeing since 2004.

“The time has come for us as well to be represented,” said Azubalis, adding that Cekuolis’ 2007 stint as the chair of the Economic and Social Council, one of the six main U.N. bodies, had given Vilnius’ U.N. envoy vital experience for the job.

Serbia, a European Union candidate which is emerging from more than a decade of isolation after the 1990s Balkan wars, has never had a shot at a U.N. job. “This is the first time that Serbia put forward a candidacy for a post within the U.N. system,” Jeremic told Reuters in an interview.

“All other countries from our part of the world had their chance to run for and serve either on the Security Council or in the General Assembly,” the 36-year-old minister said.

Jeremic has become a familiar face at the United Nations in recent years, forcefully arguing Serbia’s case in the Security Council and General Assembly against Kosovo’s 2008 declaration of independence from Belgrade, which the Serbs say was illegal.

RUSSIA WORKING BEHIND THE SCENES?

But Jeremic, who is among Europe’s longest-serving foreign ministers, may have other reasons for seeking a job in New York.

Serbian analysts and Western diplomats say Jeremic has lost support within the senior ranks of the co-ruling Democratic Party of President Boris Tadic, particularly because of a number of diplomatic setbacks in Serbia’s opposition to Kosovo’s independence. Serbia has elections in May.

Diplomats from the fractious 23-nation Eastern European Group made clear they would prefer to avoid turning to the General Assembly to help decide who from their group would take the post. The last time the assembly voted on a PGA was in 1991.

“This issue is bringing up some Cold War hostilities,” an Eastern European diplomat said on condition of anonymity.

Lithuania, a member of the European Union, suggested Russia might be encouraging Serbia to punish the Baltic state for past remarks about World War Two. Western envoys said Moscow was lobbying against Vilnius for Belgrade.

“What we have heard unofficially is that Russia is obsessed about how we see the history of the Second World War,” Azubalis said. Cekuolis said the Russians had warned Lithuania as early as November 2011 “there might be other candidates.”

Russia’s annoyance with the former Soviet republic that regained independence after the 1991 collapse of the Soviet Union may be due to remarks Cekuolis made in May 2010 at a General Assembly session commemorating the 65th anniversary of the end of World War Two.

“To our nation, the end of the war did not bring freedom,” Cekuolis said. “Instead, it resulted in the occupation and renewed annexation of Lithuania by the Soviet Union.”

“My country was subjected to the rule of another totalitarian regime, that of Soviet communism,” he said.

Russia’s U.N. mission made no attempt to hide its irritation with Cekuolis’ remarks, but vehemently denied any role in the candidacy of Serbia, a strong Russian ally, for the PGA post.

“From the very beginning we openly told Lithuanians that we could not support a candidate for General Assembly presidency who does not understand the importance of the victory over Nazism – the very victory that made the creation of the United Nations possible,” the mission said in a statement to Reuters.

Azubalis also accused Jeremic of threatening Lithuania with diplomatic retaliation if Cekuolis refuses to withdraw from the race – saying Serbia would attempt to block Lithuania’s bid for a two-year seat on the U.N. Security Council in 2014/2015.

Jeremic, who diplomats say is tipped to defeat Cekuolis in a vote, denied threatening the Lithuanians but confirmed he told them Belgrade would lobby on their behalf to win a seat on the Security Council if Cekuolis withdrew his PGA candidacy.

(Additional reporting by Matt Robinson in Belgrade; editing by Todd Eastham and Mohammad Zargham)

By Simon Jessop

LONDON, March 29 (Reuters) – European shares extended their recent slide to hit a three-week closing low, with several indexes breaching chart support levels as traders took further profits at the end of a stellar first quarter.

Cyclical stocks led the charge lower on Thursday, with autos and financials the main fallers followed by retailers after below-forecastearnings from Hennes & Mauritz .

Adding fresh weight to moves out of stocks more exposed to the economic cycle was an OECD report that highlighted the fragile state of the economic recovery, although quarter-end profit-taking also contributed, traders said. Weak U.S. jobless claims added to the gloom

By the close, the FTSEurofirst 300 index was down 1.2 percent at 1,059.21 points, but still on course for its best first quarter since 2006. World stocks, meanwhile, are eyeing the best first quarter since 1998.

A Reuters poll of analysts and fund managers pointed to further gains to year-end, although the pace is set to slow in the second quarter.

The cheap central bank money that had fueled the first-quarter rally was now petering out, in a similar fashion to market moves after the last batch of U.S. quantitative easing (QE), and the market now faced several weeks of sideways trade, Nicolas Just, head of core equities at Natixis-AM said.

“The pullback dates back two weeks or so… but it’s difficult for us to buy in the hope the market will increase. Investors have been buying on a short-term basis for the last three months and are now wondering what will happen next.”

Political uncertainty around the elections in France, the merging of Europe’s bailout funds, as well as the prospect of more U.S. QE were all being watched by markets as potential trigger points for the next leg of the rally or a deeper fall.

“Investors are not in risk-off mode yet,” he added, citing still-low levels of implied volatility, which had only seen a “modest spike” as a result of the recent pullback.

By the Thursday close, implied volatility as measured by the Euro STOXX Volatility index was up 9.9 percent at 25.36. It is still down 16 percent since the ECB launched its first long-term funding operation in December, however.

“When you look at the term structure of volatility, out to one year, it’s going up. Nobody believes the low-volatility environment will continue. Something has to happen.”

TECHNICAL PULLBACK

Recent breaches of the 50-day moving averages in both the FTSEurofirst 300 and Euro-STOXX 50 extended a break of the uptrend begun in late November.

A similar move through their 23.6 percent Fibonacci retracements of the recent three-month rally, two key support levels, sent a bearish technical signal to the market. The next strong support levels are on the 38.2 percent Fibonacci retracement of the rally, at 1,048.37 and 2,447.67 for the FTSEurofirst 300 and Euro STOXX 50, respectively.

In spite of the technical pressure and signs in the options market of increased pessimism, with a rise in demand for put protection to protect against further short-term falls, the case for equities over other asset classes remained strong for some.

“Last year we said there is too much uncertainty, there is too much risk … (But now) there is no reason not to own equities at the moment,” Andrew Parry, chief executive at Hermes Sourcecap, said.

“When you have bond yields at 2 percent, you cannot make very much money. The central banks around the world are sponsoring low bond yields and high inflation.”

The Reuters poll of stock market participants expected emerging markets to pick up the baton and lead index gainers later in 2012.

Just said he had become more defensive in his sector positioning, cutting financials to neutral and targeting emerging markets-exposed firms, such as LVMH.

VOLUME MOVERS

After a quarter marked by low volumes, Thursday was an above average day, at 115 percent of the 90-day daily average, helped by heavy trade in UK power producer International Power.

The firm rose 5.6 percent in trade more than 15 times its average to be the top gainer on the FTSEurofirst 300 after French firm GDF Suez bid 6 billion pounds ($9.51 billion) for the 30 percent of the firm it does not already own.

However, Swiss lender UBS flagged still-cautious first-quarter behaviour from clients at its flagship private bank, with many still preferring to hold cash in the face of Europe’s economic woes and the long-running debt crisis.

“Clients are looking for sustainable improvements in what they see primarily in Europe,” UBS’s financial head Tom Naratil told investors at a brokerage conference on Thursday.

That sign of improvement was markedly absent from peripheral bond markets on Thursday, however, as both Spanish and Italian yields rose in spite of a broadly successful auction of Italian debt.

In response Milan’s FTSE MIB ended down 3.3 percent, weighed by a chunky fall in UniCredit and other big holders of government debt.