Good Day Everyone,
I have created my own new site MyEduTrade Journey to provide more of my personal experience. Something that I can share using my own creation. Please go to this site, http://www.myedutrade.com/ for more details as I will blog and provides all details at the new site from now on. I would like to say my thanks to everyone for your time in reading and accessing my site.
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Gabriel
myedutrade.com
Wednesday, September 22, 2010
Saturday, September 11, 2010
China to release inflation, factory data during weekend
Rescheduling to Saturday may indicate surprise result with market significance
By Chris Oliver, MarketWatch
HONG KONG (MarketWatch) -- China will release August national economic data on Saturday, bringing forward the scheduled release by two days and inciting speculation that the data release could contain unexpected results with market implications.
Monthly figures for industrial output, fixed asset investment, along with consumer and wholesale-price inflation data will be reported on Saturday, the National Bureau of Statistics said in a statement. The data had been originally scheduled for Monday.
Analysts said China's central bank could be planning an announcement on interest rates before markets open on Monday in response to what could be surging inflation.
Expectations are for inflation to rise above 3.5%, driven partly by higher food prices. That would bring push the return on deposit, current at 2.25%, significantly negative.
China's food prices jumped 6.8% in July from a year earlier, while the overall inflation rose 3.3% from the year-ago period.
Investing in Emerging Markets' Building BoomCompanies that build or maintain infrastructure -- roads, bridges and more -- in China, Brazil and other emerging markets are set to gain in coming years. Aaron Visse of the Forward Global Infrastructure Fund talks with MarketWatch's Jonathan Burton.
A CPI measure hovering near 4% would likely be viewed as temporary owing to surging food prices related to weather-afflicted harvest shortfalls earlier this year, an analyst said.
"I don't think it has [interest rate] policy implications," said Citigroup Global Markets economist Ken Peng in Beijing.
He added there was a "policy-induced downside risk" to industrial production figures for August, after Beijing ordered power supply cuts for heavy-consuming industries earlier this summer.
Chinese demand is considered the global price setter and any sharp decline in output could have consequences for crude oil, copper and other industrial commodities.
Yuan allowed to rise
China's central bank on Friday set the yuan parity rate 6.7625 to the U.S. dollar, a level that represents the strongest for the Chinese currency against the dollar since it was delinked from its peg to the dollar in July 2005. Thursday, the dollar-yuan (USDCNY 6.7930, +0.0045, +0.0663%) parity was set at 6.7817.
In separate release Friday, trade data for August showed that imports continued to rise at a fast clip on strong domestic consumption, resulting in a lower-than-expected monthly trade surplus.
The country's exports rose 34.4% year-on-year to $139.3 billion, against 35% growth expected by economists surveyed by Dow Jones Newswires. Imports climbed 35.2% to $119.27 billion, compared to an expected 25% increase. China's trade surplus narrowed to $20.0 billion in August, from $28.7 billion in July. Economists had been expecting a $30.0 billion surplus.
Analysts said the figures showed tightening measures by Beijing earlier this year were helping cool the domestic economy even as external demand remained relatively strong.
"The recent strength in China's exports suggests that the slowdown in Chinese growth that has been evident in the last few months has not been caused by external factors but ...the result of policy decisions made to reduce overheating risks and bring growth down to more sustainable levels," said RBC analyst Brian Jackson in Hong Kong.
He added the $20 billion trade surplus, though below expectations, was high by historical standards.
Other data released Friday showed national house prices rose 9.3% in August, easing from a 10.3% rise on year in July.
Chris Oliver is MarketWatch's Hong Kong bureau chief
By Chris Oliver, MarketWatch
HONG KONG (MarketWatch) -- China will release August national economic data on Saturday, bringing forward the scheduled release by two days and inciting speculation that the data release could contain unexpected results with market implications.
Monthly figures for industrial output, fixed asset investment, along with consumer and wholesale-price inflation data will be reported on Saturday, the National Bureau of Statistics said in a statement. The data had been originally scheduled for Monday.
Analysts said China's central bank could be planning an announcement on interest rates before markets open on Monday in response to what could be surging inflation.
Expectations are for inflation to rise above 3.5%, driven partly by higher food prices. That would bring push the return on deposit, current at 2.25%, significantly negative.
China's food prices jumped 6.8% in July from a year earlier, while the overall inflation rose 3.3% from the year-ago period.
Investing in Emerging Markets' Building BoomCompanies that build or maintain infrastructure -- roads, bridges and more -- in China, Brazil and other emerging markets are set to gain in coming years. Aaron Visse of the Forward Global Infrastructure Fund talks with MarketWatch's Jonathan Burton.
A CPI measure hovering near 4% would likely be viewed as temporary owing to surging food prices related to weather-afflicted harvest shortfalls earlier this year, an analyst said.
"I don't think it has [interest rate] policy implications," said Citigroup Global Markets economist Ken Peng in Beijing.
He added there was a "policy-induced downside risk" to industrial production figures for August, after Beijing ordered power supply cuts for heavy-consuming industries earlier this summer.
Chinese demand is considered the global price setter and any sharp decline in output could have consequences for crude oil, copper and other industrial commodities.
Yuan allowed to rise
China's central bank on Friday set the yuan parity rate 6.7625 to the U.S. dollar, a level that represents the strongest for the Chinese currency against the dollar since it was delinked from its peg to the dollar in July 2005. Thursday, the dollar-yuan (USDCNY 6.7930, +0.0045, +0.0663%) parity was set at 6.7817.
In separate release Friday, trade data for August showed that imports continued to rise at a fast clip on strong domestic consumption, resulting in a lower-than-expected monthly trade surplus.
The country's exports rose 34.4% year-on-year to $139.3 billion, against 35% growth expected by economists surveyed by Dow Jones Newswires. Imports climbed 35.2% to $119.27 billion, compared to an expected 25% increase. China's trade surplus narrowed to $20.0 billion in August, from $28.7 billion in July. Economists had been expecting a $30.0 billion surplus.
Analysts said the figures showed tightening measures by Beijing earlier this year were helping cool the domestic economy even as external demand remained relatively strong.
"The recent strength in China's exports suggests that the slowdown in Chinese growth that has been evident in the last few months has not been caused by external factors but ...the result of policy decisions made to reduce overheating risks and bring growth down to more sustainable levels," said RBC analyst Brian Jackson in Hong Kong.
He added the $20 billion trade surplus, though below expectations, was high by historical standards.
Other data released Friday showed national house prices rose 9.3% in August, easing from a 10.3% rise on year in July.
Chris Oliver is MarketWatch's Hong Kong bureau chief
Wednesday, September 8, 2010
Singapore Stocks-Down on losses in telcos, 3,000 support eyed
Reuters - Tuesday, September 7Send IM Story Print
* Index down 0.32 pct, seen in 3,000-3,042 range afternoon
* SingTel, StarHub and M1 drop on fears of new competition
* SingTel falls ahead of announcement on new Australia govt
By Charmian Kok
SINGAPORE, Sept 7 - Singapore shares dropped 0.32 percent, weighed by losses in telcom operators after a newspaper reported the government may allow a fourth mobile phone operator in the city-state.
By the midday break the Straits Times Index <.FTSTI> was down 9.73 points at 3,024.85. More than 131.8 million shares had changed hands.
"Singapore shares are likely to trade sideways later this afternoon, as there's little movement in U.S. futures so far. As the U.S. was on holiday yesterday, the STI is mainly taking its cues from Japan, which is down," said Carey Wong, an analyst at OCBC Investment Research.
The benchmark index is likely to trade with a downward bias in the 3,000-3,042 band, traders said.
Shares of Singapore's three telcom operators fell on Tuesday after the Business Times reported Singapore will auction another third-generation spectrum in November, paving the way for a fourth mobile phone operator. [ID:nSGE68601F]
Singapore Telecommunicationswas also hit by uncertainty ahead of the announcement of Australia's new government, which is expected later Tuesday.
SingTel shares fell 1.6 percent to S$3.06 with 10.5 million shares changing hands, StarHub dropped 2.8 percent, while M1 declined 1.3 percent.
"If the opposition party wins, this may be bad news for SingTel, as the new government may not spend as much on broadband infrastructure in Australia," said a local trader.
Australia's conservative opposition said last month it would scrap the current government's plan to build a high-speed broadband network if it won, which could have negative implications for SingTel's Australian unit Optus. [ID:nSGE67901G]
Singapore-listed casino operator Genting Hong Kongfell 3.4 percent to S$0.425 as investors pared holdings in the firm after its shares surged 47 percent over the last two trading sessions. [ID:nSGE68603U]
* Index down 0.32 pct, seen in 3,000-3,042 range afternoon
* SingTel, StarHub and M1 drop on fears of new competition
* SingTel falls ahead of announcement on new Australia govt
By Charmian Kok
SINGAPORE, Sept 7 - Singapore shares dropped 0.32 percent, weighed by losses in telcom operators after a newspaper reported the government may allow a fourth mobile phone operator in the city-state.
By the midday break the Straits Times Index <.FTSTI> was down 9.73 points at 3,024.85. More than 131.8 million shares had changed hands.
"Singapore shares are likely to trade sideways later this afternoon, as there's little movement in U.S. futures so far. As the U.S. was on holiday yesterday, the STI is mainly taking its cues from Japan, which is down," said Carey Wong, an analyst at OCBC Investment Research.
The benchmark index is likely to trade with a downward bias in the 3,000-3,042 band, traders said.
Shares of Singapore's three telcom operators fell on Tuesday after the Business Times reported Singapore will auction another third-generation spectrum in November, paving the way for a fourth mobile phone operator. [ID:nSGE68601F]
Singapore Telecommunications
SingTel shares fell 1.6 percent to S$3.06 with 10.5 million shares changing hands, StarHub dropped 2.8 percent, while M1 declined 1.3 percent.
"If the opposition party wins, this may be bad news for SingTel, as the new government may not spend as much on broadband infrastructure in Australia," said a local trader.
Australia's conservative opposition said last month it would scrap the current government's plan to build a high-speed broadband network if it won, which could have negative implications for SingTel's Australian unit Optus. [ID:nSGE67901G]
Singapore-listed casino operator Genting Hong Kong
Tuesday, September 7, 2010
HOT STOCK - KIM ENG says SPH - Money Mind
HOT STOCK - KIM ENG says SPH is on course to report a record net profit for FY Aug10 when it announces its full-year results, likely on 12 October. Our page count shows that sales growth in the fourth quarter moderated somewhat, but the Singapore growth story will continue to sustain print advertising demand. Catalysts lie on the property front. BUY with a target price of $4.62. - KIM ENG
HOT STOCK: KIM ENG says Eratat Lifestyle - Money Mind
HOT STOCK: KIM ENG says Eratat Lifestyle recently held its annual Spring/Summer 2011 trade fair to showcase its latest designs to its distributors. Response has been very positive with new products generally able to command higher ASPs. We see a favorable risk-to-reward ratio as the stock is now trading at only 4x FY10 PER, a steep discount to China Hongxing of over 20x.
Monday, September 6, 2010
Some Indicators I used.
I) MACD - Moving Average Convergence Divergence
Calculation :
The blue line of the MACD is obtained by substracting the y days exponential moving average from the x days exponential moving average
The red line of the MACD is obtained by calculating a z days exponential moving average of the blue line.
x, y and z are the MACD parameters, typically equal respectively to 12, 26 and 9.
The MACD histogram is obtained by substracting the red line from the blue line.
Interpretation :
MACD is an excellent trend indicator, and partly minimises the delays obtained with the usage of simple moving averages.
There are 2 basic ways to use MACD:
Crossings:
A buy opportunity appears when MACD crosses upwards its signal line.
A sell signal may be triggered when MACD crosses downwards its signal line.
The divergences between the MACD histogram and the price quote identify major reversal points and give strong buy/sell signals.
A bullish divergence occurs when stock prices make new lows while the MACD histogram fails to make new lows.
A bearish divergence occurs when the stock price makes new highs while the MACD histogram fails to make new highs.
The bullish and bearish divergences are more significant when the MACD is in an overbought or oversold level.
The opportunities appearing in longer time horizons (weekly, monthly..) generate larger price movements.
II) Fast/Slow Stochastics
Calculation :
The first parameter is the number of days used to calculate %K, the second is the number of days to be considered for the moving average of %K (generally 1 for Fast Stochastic and 3 or 5 for Slow Stochastic), the third is the number of days to be considered for the moving average of %D.
Interpretation :
It is an overbought/oversold indicator depending on its position relative to the 0 level.
It also gives good divergence signals.
A bullish divergence occurs when the stock price makes new lows while the Stochastic fails to make new lows.
A bearish divergence occurs when the stock price makes new highs while the Stochastic fails to make new highs.
III) RSI
Calculation:
RSI(on n period)=100-100/(1+p) with p=(average of n days up/average of n days down).
Interpretation :
RSI is an overbought / oversold indicator. Buy signals occur generally when crossing the 30 level and sell signals when crossing the 70 level.
RSI is always scaled between 0 and 100.
It also gives good divergence signals.
A bullish divergence occurs when the stock price makes new lows while the RSI fails to make new lows.
A bearish divergence occurs when the stock price makes new highs while the RSI fails to make new highs.
IV) Bollinger Bands
Calculation:
Bollinger bands are envelopes based on a moving average and a standard deviation.
This standard deviation makes bands widen or narrow, according to market volatility. The first parameter is the number of days for the moving average. The second parameter is the standard deviation.
Interpretation :
95% of the prices must be inside the bands if one can presume that prices follow a normal Gaussian distribution (bell curve).
The bands thus constitute strong zones of support and resistance when the market is without clear trend. When the difference between the two envelopes drops after having increased, the trend loses its force.
Calculation :
The blue line of the MACD is obtained by substracting the y days exponential moving average from the x days exponential moving average
The red line of the MACD is obtained by calculating a z days exponential moving average of the blue line.
x, y and z are the MACD parameters, typically equal respectively to 12, 26 and 9.
The MACD histogram is obtained by substracting the red line from the blue line.
Interpretation :
MACD is an excellent trend indicator, and partly minimises the delays obtained with the usage of simple moving averages.
There are 2 basic ways to use MACD:
Crossings:
A buy opportunity appears when MACD crosses upwards its signal line.
A sell signal may be triggered when MACD crosses downwards its signal line.
The divergences between the MACD histogram and the price quote identify major reversal points and give strong buy/sell signals.
A bullish divergence occurs when stock prices make new lows while the MACD histogram fails to make new lows.
A bearish divergence occurs when the stock price makes new highs while the MACD histogram fails to make new highs.
The bullish and bearish divergences are more significant when the MACD is in an overbought or oversold level.
The opportunities appearing in longer time horizons (weekly, monthly..) generate larger price movements.
II) Fast/Slow Stochastics
Calculation :
The first parameter is the number of days used to calculate %K, the second is the number of days to be considered for the moving average of %K (generally 1 for Fast Stochastic and 3 or 5 for Slow Stochastic), the third is the number of days to be considered for the moving average of %D.
Interpretation :
It is an overbought/oversold indicator depending on its position relative to the 0 level.
It also gives good divergence signals.
A bullish divergence occurs when the stock price makes new lows while the Stochastic fails to make new lows.
A bearish divergence occurs when the stock price makes new highs while the Stochastic fails to make new highs.
III) RSI
Calculation:
RSI(on n period)=100-100/(1+p) with p=(average of n days up/average of n days down).
Interpretation :
RSI is an overbought / oversold indicator. Buy signals occur generally when crossing the 30 level and sell signals when crossing the 70 level.
RSI is always scaled between 0 and 100.
It also gives good divergence signals.
A bullish divergence occurs when the stock price makes new lows while the RSI fails to make new lows.
A bearish divergence occurs when the stock price makes new highs while the RSI fails to make new highs.
IV) Bollinger Bands
Calculation:
Bollinger bands are envelopes based on a moving average and a standard deviation.
This standard deviation makes bands widen or narrow, according to market volatility. The first parameter is the number of days for the moving average. The second parameter is the standard deviation.
Interpretation :
95% of the prices must be inside the bands if one can presume that prices follow a normal Gaussian distribution (bell curve).
The bands thus constitute strong zones of support and resistance when the market is without clear trend. When the difference between the two envelopes drops after having increased, the trend loses its force.
Sunday, September 5, 2010
Petrobras to sell $65 billion stock in record offer
By Brian Ellsworth
RIO DE JANEIRO
Fri Sep 3, 2010 2:24pm EDT
RIO DE JANEIRO (Reuters) - Brazilian state oil company Petrobras on Friday filed to sell up to $64.5 billion of new stock -- the largest in capital markets history -- sending its stock sharply higher after months of uncertainty that dragged on its share price.
The global stock offer could be expanded to as much as $74.7 billion if underwriters exercise a "greenshoe" option to sell an additional 564 million shares to meet extraordinary demand as the company raises funds for the world's biggest oil exploration program.
That would easily top the $22.1 billion initial public offering by Agricultural Bank of China (601288.SS) earlier this year, as well as the $36.8 billion share sale by Japanese telecommunications company NTT (9432.T) in 1987.
Despite lingering investor concerns about growing government sway over Petrobras (PBR.N) and the possibility of share dilution, the announcement helped investors regain confidence in a stock that slumped as much as 25 percent this year on uncertainty over the plan.
"It's better to have a tragic end than an unending tragedy," said Marcio Macedo, who oversees about $40 million of assets at Humaita Investimentos in Sao Paulo.
"Investors may not have liked the way they carried out the deal, but this is a world-class asset. There's no way you can't own it."
Petrobras preferred shares were up 4 percent at 28.71 reais in late afternoon trade, near the stock's high for the day.
The company filed to sell 1.59 billion new preferred shares (PETR4.SA) and 2.17 billion new common shares (PETR3.SA). At Thursday's closing prices, it would raise 67.8 billion reais ($39.2 billion) with the common shares sale and 43.8 billion reais ($25.4 billion) from the preferred shares.
The offer includes a $43 billion state-backed swap of oil for shares in which Petrobras will trade new shares for rights to produce 5 billion barrels of offshore oil.
The company faces skepticism from some investors who have questioned the price of $8.51 per barrel for the reserves to be used in the oil-for-shares swap, considerably higher than the $5 to $6 per barrel that analysts said was fair.
Petrobras expects to begin bookbuilding on Friday and price the share sale on September 23.
The plan has become the financial cornerstone of the company's $224 billion, five-year investment plan meant to turn Brazil into a major oil exporter by tapping crude buried deep under the ocean floor in a region known as the subsalt.
Petrobras ranks fifth in oil and gas production among the world's publicly listed oil companies, according to its own figures, with output of 2.53 million barrels of oil equivalent, an amount nearly equal to that of U.S.-based Chevron (CVX.N).
It expects by 2017 that its output will surpass that of Shell (RDSa.L), BP (BP.L), Exxon Mobil (XOM.N) and Chevron, mostly due to new production from the subsalt wells.
INVESTOR INTEREST
Government leaders have also said they plan to boost the state's participation in Petrobras' capital to around 40 percent from near 30 percent, which has left some investors nervous about greater state sway in the company.
Analysts say the large size of the swap of oil for shares with respect to the entire stock sale -- authorized by shareholders for up to $85 billion -- shows the government expects it will be able to pick up a considerable number of shares not purchased by private investors.
The stock offering will be led by Banco Bradesco (BBDC4.SA) in coordination with Bank of America Merrill Lynch (BAC.N), Citigroup (C.N), Banco Itau (ITUB4.SA), Morgan Stanley (MS.N), and Banco Santander Brasil. It will also be co-managed by BTG Pactual BTG.UL and Banco do Brasil (BBAS3.SA).
Some investors say the concerns about the government's stake have already been priced in and that the company is still a compelling investment given its unique access to quality oil reserves in a world that is quickly running out of them.
"I'm finally seeing a very clear pathway to the completion of this whole process, and that's a huge positive," said Marc Fogassa, a managing partner at Hedgefort Capital Management, which owns Petrobras shares.
Minority shareholder participation in the offering will be crucial since it will bring in much-needed cash for the company to shore up its balance sheet, stretched by heavy borrowing to finance the ambitious offshore plans.
The government has authorized state banks, including development lender BNDES, to purchase stock that minority shareholders do not subscribe.
Oil for the exchange will come from at least six fields in the subsalt region, most of which are adjacent to major offshore discoveries such as Franco and Tupi finds.
(Additional reporting by Elzio Barreto in Sao Paulo; Editing by Todd Benson and Steve Orlofsky)
RIO DE JANEIRO
Fri Sep 3, 2010 2:24pm EDT
RIO DE JANEIRO (Reuters) - Brazilian state oil company Petrobras on Friday filed to sell up to $64.5 billion of new stock -- the largest in capital markets history -- sending its stock sharply higher after months of uncertainty that dragged on its share price.
The global stock offer could be expanded to as much as $74.7 billion if underwriters exercise a "greenshoe" option to sell an additional 564 million shares to meet extraordinary demand as the company raises funds for the world's biggest oil exploration program.
That would easily top the $22.1 billion initial public offering by Agricultural Bank of China (601288.SS) earlier this year, as well as the $36.8 billion share sale by Japanese telecommunications company NTT (9432.T) in 1987.
Despite lingering investor concerns about growing government sway over Petrobras (PBR.N) and the possibility of share dilution, the announcement helped investors regain confidence in a stock that slumped as much as 25 percent this year on uncertainty over the plan.
"It's better to have a tragic end than an unending tragedy," said Marcio Macedo, who oversees about $40 million of assets at Humaita Investimentos in Sao Paulo.
"Investors may not have liked the way they carried out the deal, but this is a world-class asset. There's no way you can't own it."
Petrobras preferred shares were up 4 percent at 28.71 reais in late afternoon trade, near the stock's high for the day.
The company filed to sell 1.59 billion new preferred shares (PETR4.SA) and 2.17 billion new common shares (PETR3.SA). At Thursday's closing prices, it would raise 67.8 billion reais ($39.2 billion) with the common shares sale and 43.8 billion reais ($25.4 billion) from the preferred shares.
The offer includes a $43 billion state-backed swap of oil for shares in which Petrobras will trade new shares for rights to produce 5 billion barrels of offshore oil.
The company faces skepticism from some investors who have questioned the price of $8.51 per barrel for the reserves to be used in the oil-for-shares swap, considerably higher than the $5 to $6 per barrel that analysts said was fair.
Petrobras expects to begin bookbuilding on Friday and price the share sale on September 23.
The plan has become the financial cornerstone of the company's $224 billion, five-year investment plan meant to turn Brazil into a major oil exporter by tapping crude buried deep under the ocean floor in a region known as the subsalt.
Petrobras ranks fifth in oil and gas production among the world's publicly listed oil companies, according to its own figures, with output of 2.53 million barrels of oil equivalent, an amount nearly equal to that of U.S.-based Chevron (CVX.N).
It expects by 2017 that its output will surpass that of Shell (RDSa.L), BP (BP.L), Exxon Mobil (XOM.N) and Chevron, mostly due to new production from the subsalt wells.
INVESTOR INTEREST
Government leaders have also said they plan to boost the state's participation in Petrobras' capital to around 40 percent from near 30 percent, which has left some investors nervous about greater state sway in the company.
Analysts say the large size of the swap of oil for shares with respect to the entire stock sale -- authorized by shareholders for up to $85 billion -- shows the government expects it will be able to pick up a considerable number of shares not purchased by private investors.
The stock offering will be led by Banco Bradesco (BBDC4.SA) in coordination with Bank of America Merrill Lynch (BAC.N), Citigroup (C.N), Banco Itau (ITUB4.SA), Morgan Stanley (MS.N), and Banco Santander Brasil. It will also be co-managed by BTG Pactual BTG.UL and Banco do Brasil (BBAS3.SA).
Some investors say the concerns about the government's stake have already been priced in and that the company is still a compelling investment given its unique access to quality oil reserves in a world that is quickly running out of them.
"I'm finally seeing a very clear pathway to the completion of this whole process, and that's a huge positive," said Marc Fogassa, a managing partner at Hedgefort Capital Management, which owns Petrobras shares.
Minority shareholder participation in the offering will be crucial since it will bring in much-needed cash for the company to shore up its balance sheet, stretched by heavy borrowing to finance the ambitious offshore plans.
The government has authorized state banks, including development lender BNDES, to purchase stock that minority shareholders do not subscribe.
Oil for the exchange will come from at least six fields in the subsalt region, most of which are adjacent to major offshore discoveries such as Franco and Tupi finds.
(Additional reporting by Elzio Barreto in Sao Paulo; Editing by Todd Benson and Steve Orlofsky)
Saturday, September 4, 2010
Dow now positive for 2010
Stocks close higher on jobs optimism
Dow up 2.9% for week, turns positive for year
By Kristina Peterson and Jonathan Cheng,
NEW YORK (MarketWatch) -- Investors pushed stocks up for the fourth day in a row, sailing into the long weekend on a high note as an encouraging jobs report sent stocks to their best pre-Labor Day week in two decades.
The Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (DJIA 10,448, +127.83, +1.24%) finished up 127.98 points, or 1.24%, to 10447.93, putting the Dow up 2.9% on the week -- its first positive weekly showing since the beginning of August. The Dow also edged back into positive territory for the year.
The market leaped after nonfarm payrolls data showed jobs slowing at half the rate predicted by economists. The Labor Department said the U.S. lost 54,000 jobs last month, about half of what economists had expected and matching the level of revised losses recorded the previous month.
The unemployment rate, calculated using a separate household survey, edged up to 9.6%, as expected, from 9.5% for the previous two months.
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• See all the latest markets video /conga/story/misc/markets.html 84614 "In the last two weeks or so, things have been starting to firm up, and today's jobs numbers really put an exclamation mark on that," said Phil Orlando, equity strategist at Federated Investors. "We're feeling a lot more comfortable about our view, than those thinking about a double dip."
Orlando predicted that stocks would pick up after Labor Day, as vacationing money managers return to an economy whose outlook has improved.
"If you had a bearish bent in the middle of August when you went on vacation, the story seems different today -- it seems constructive," he said.
Not everyone was impressed. Bob Browne, chief investment officer at Northern Trust Global Investments, said the addition of new private-sector jobs is "not enough to absorb new entrants into the work force let alone put the unemployed from the past few years back to work," adding: "We have a long way to go."
But even slowing job losses was "enough to give us a catalyst on a light day going into a long weekend," he said.
The Nasdaq Composite /quotes/comstock/10y!i:comp (COMP 2,234, +33.74, +1.53%) rose 1.53% to 2233.75, up 3.7% on the week. The Standard & Poor's 500-stock index /quotes/comstock/21z!i1:in\x (SPX 1,105, +14.41, +1.32%) tacked on 1.32% to 1104.47, putting its advance for the week at 3.7%.
Goldman Sachs Group /quotes/comstock/13*!gs/quotes/nls/gs (GS 147.29, +7.51, +5.37%) rose 5.4% as financial stocks led the day's and week's gains. Morgan Stanley /quotes/comstock/13*!ms/quotes/nls/ms (MS 26.66, +0.98, +3.82%) gained 3.8%, J.P. Morgan Chase /quotes/comstock/13*!jpm/quotes/nls/jpm (JPM 39.17, +1.01, +2.65%) added 2.7% and Genworth Financial /quotes/comstock/13*!gnw/quotes/nls/gnw (GNW 12.03, +0.68, +5.99%) advanced 6%.
Friday's jobs numbers followed recent reports on manufacturing and housing that also came in above expectations, extending a notable reversal from a long string of disappointing data that had driven the Dow's biggest August drop since 2001.
The Politics of 9.6% UnemploymentColumnist Mary Anastasia O'Grady breaks down the August jobs report and the implications for November elections. Editorial Writer Anne Jolis in London discusses a new development in the disturbing Climategate emails.
Volume was light, with about 3.6 billion shares changing hands in NYSE composite trading, short of 2010's daily average of about five billion shares.
"The fear is really building towards a sharp movement upwards rather than downwards," said Joe Greco, managing director for Meridian Equity Partners. "Most of the bullets have been used from the sell side, and any strong data is going to fuel the momentum trade and short covering."
The strong start to the month comes as investors have been encouraged that a double-dip recession may be avoided. But the economic recovery still looks weak; data released Friday by the Institute for Supply Management showed a slowing expansion in the U.S. nonmanufacturing sector last month.
The U.S. Dollar Index /quotes/comstock/11j!i:dxy0 (DXY 82.02, +0.64, +0.79%) , reflecting the U.S. currency against a basket of six others, declined 0.5%. Treasurys slipped, pushing the yield on the 10-year note /quotes/comstock/31*!ust10y (UST10Y 2.71, 0.00, 0.00%) up to 2.71%. Crude-oil futures dropped to $74.34 a barrel, while gold futures also slipped.
On the deals front, Goldcorp /quotes/comstock/13*!gg/quotes/nls/gg (GG 42.84, -0.96, -2.19%) slipped 2.3% after the gold miner agreed to acquire all outstanding shares of Andean Resources /quotes/comstock/11t!and (CA:AND 6.98, +2.17, +45.11%) for $3.4 billion. Andean's principal asset is the Cerro Negro gold project located in Argentina. Read more about GoldCorp's deal.
Shares of Take-Two Interactive Software Inc. /quotes/comstock/15*!ttwo/quotes/nls/ttwo (TTWO 9.50, +0.65, +7.34%) rallied 10% after the company reported an unexpected quarterly profit and said it expects a fiscal-year profit. Read more about Take-Two's results.
Tax-preparation company H&R Block Inc. /quotes/comstock/13*!hrb/quotes/nls/hrb (HRB 13.30, +0.73, +5.81%) climbed 5.8% after reporting a smaller-than-expected loss from continuing operations.
Campbell Soup Co. /quotes/comstock/13*!cpb/quotes/nls/cpb (CPB 36.21, -1.11, -2.97%) slipped 2.4% after its fiscal fourth-quarter earnings jumped 64% on prior-year write-downs, but revenue at its soup business weakened
Dow up 2.9% for week, turns positive for year
By Kristina Peterson and Jonathan Cheng,
NEW YORK (MarketWatch) -- Investors pushed stocks up for the fourth day in a row, sailing into the long weekend on a high note as an encouraging jobs report sent stocks to their best pre-Labor Day week in two decades.
The Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (DJIA 10,448, +127.83, +1.24%) finished up 127.98 points, or 1.24%, to 10447.93, putting the Dow up 2.9% on the week -- its first positive weekly showing since the beginning of August. The Dow also edged back into positive territory for the year.
The market leaped after nonfarm payrolls data showed jobs slowing at half the rate predicted by economists. The Labor Department said the U.S. lost 54,000 jobs last month, about half of what economists had expected and matching the level of revised losses recorded the previous month.
The unemployment rate, calculated using a separate household survey, edged up to 9.6%, as expected, from 9.5% for the previous two months.
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• See all the latest markets video /conga/story/misc/markets.html 84614 "In the last two weeks or so, things have been starting to firm up, and today's jobs numbers really put an exclamation mark on that," said Phil Orlando, equity strategist at Federated Investors. "We're feeling a lot more comfortable about our view, than those thinking about a double dip."
Orlando predicted that stocks would pick up after Labor Day, as vacationing money managers return to an economy whose outlook has improved.
"If you had a bearish bent in the middle of August when you went on vacation, the story seems different today -- it seems constructive," he said.
Not everyone was impressed. Bob Browne, chief investment officer at Northern Trust Global Investments, said the addition of new private-sector jobs is "not enough to absorb new entrants into the work force let alone put the unemployed from the past few years back to work," adding: "We have a long way to go."
But even slowing job losses was "enough to give us a catalyst on a light day going into a long weekend," he said.
The Nasdaq Composite /quotes/comstock/10y!i:comp (COMP 2,234, +33.74, +1.53%) rose 1.53% to 2233.75, up 3.7% on the week. The Standard & Poor's 500-stock index /quotes/comstock/21z!i1:in\x (SPX 1,105, +14.41, +1.32%) tacked on 1.32% to 1104.47, putting its advance for the week at 3.7%.
Goldman Sachs Group /quotes/comstock/13*!gs/quotes/nls/gs (GS 147.29, +7.51, +5.37%) rose 5.4% as financial stocks led the day's and week's gains. Morgan Stanley /quotes/comstock/13*!ms/quotes/nls/ms (MS 26.66, +0.98, +3.82%) gained 3.8%, J.P. Morgan Chase /quotes/comstock/13*!jpm/quotes/nls/jpm (JPM 39.17, +1.01, +2.65%) added 2.7% and Genworth Financial /quotes/comstock/13*!gnw/quotes/nls/gnw (GNW 12.03, +0.68, +5.99%) advanced 6%.
Friday's jobs numbers followed recent reports on manufacturing and housing that also came in above expectations, extending a notable reversal from a long string of disappointing data that had driven the Dow's biggest August drop since 2001.
The Politics of 9.6% UnemploymentColumnist Mary Anastasia O'Grady breaks down the August jobs report and the implications for November elections. Editorial Writer Anne Jolis in London discusses a new development in the disturbing Climategate emails.
Volume was light, with about 3.6 billion shares changing hands in NYSE composite trading, short of 2010's daily average of about five billion shares.
"The fear is really building towards a sharp movement upwards rather than downwards," said Joe Greco, managing director for Meridian Equity Partners. "Most of the bullets have been used from the sell side, and any strong data is going to fuel the momentum trade and short covering."
The strong start to the month comes as investors have been encouraged that a double-dip recession may be avoided. But the economic recovery still looks weak; data released Friday by the Institute for Supply Management showed a slowing expansion in the U.S. nonmanufacturing sector last month.
The U.S. Dollar Index /quotes/comstock/11j!i:dxy0 (DXY 82.02, +0.64, +0.79%) , reflecting the U.S. currency against a basket of six others, declined 0.5%. Treasurys slipped, pushing the yield on the 10-year note /quotes/comstock/31*!ust10y (UST10Y 2.71, 0.00, 0.00%) up to 2.71%. Crude-oil futures dropped to $74.34 a barrel, while gold futures also slipped.
On the deals front, Goldcorp /quotes/comstock/13*!gg/quotes/nls/gg (GG 42.84, -0.96, -2.19%) slipped 2.3% after the gold miner agreed to acquire all outstanding shares of Andean Resources /quotes/comstock/11t!and (CA:AND 6.98, +2.17, +45.11%) for $3.4 billion. Andean's principal asset is the Cerro Negro gold project located in Argentina. Read more about GoldCorp's deal.
Shares of Take-Two Interactive Software Inc. /quotes/comstock/15*!ttwo/quotes/nls/ttwo (TTWO 9.50, +0.65, +7.34%) rallied 10% after the company reported an unexpected quarterly profit and said it expects a fiscal-year profit. Read more about Take-Two's results.
Tax-preparation company H&R Block Inc. /quotes/comstock/13*!hrb/quotes/nls/hrb (HRB 13.30, +0.73, +5.81%) climbed 5.8% after reporting a smaller-than-expected loss from continuing operations.
Campbell Soup Co. /quotes/comstock/13*!cpb/quotes/nls/cpb (CPB 36.21, -1.11, -2.97%) slipped 2.4% after its fiscal fourth-quarter earnings jumped 64% on prior-year write-downs, but revenue at its soup business weakened
Friday, September 3, 2010
Liberia, VerOleum to invest $2.15b in oil palm
Written by Bloomberg
Friday, 03 September 2010 11:01
Golden Agri-Resources, part of Indonesia’s Sinar Mas Group, said the government of Liberia and Golden VerOleum (Liberia) Inc. plan to invest US$1.6 billion ($2.15 billion) in oil palm plantations in the African nation.
Friday, 03 September 2010 11:01
Golden Agri-Resources, part of Indonesia’s Sinar Mas Group, said the government of Liberia and Golden VerOleum (Liberia) Inc. plan to invest US$1.6 billion ($2.15 billion) in oil palm plantations in the African nation.
Genting Hong Kong +18.3%; Eyes on Manila gaming
Written by The Edge
Friday, 03 September 2010 13:03
Genting Hong Kong (S21.SG) +11.7% at new 52-week high of US$0.355 ($0.478) on strong volume as players turn attention from sister company Genting Singapore (G13.SG) to cruise operator, hopeful it could also enjoy latter’s gaming success given its 50% stake in Resorts World Manila, says Dow Jones.
“Since RWM’s entry (in 2009), the overall Philippines gaming market has more than doubled year to date. This is another example of new properties growing gaming markets rather than cannibalising the existing pie,” says a broker.
Friday, 03 September 2010 13:03
Genting Hong Kong (S21.SG) +11.7% at new 52-week high of US$0.355 ($0.478) on strong volume as players turn attention from sister company Genting Singapore (G13.SG) to cruise operator, hopeful it could also enjoy latter’s gaming success given its 50% stake in Resorts World Manila, says Dow Jones.
“Since RWM’s entry (in 2009), the overall Philippines gaming market has more than doubled year to date. This is another example of new properties growing gaming markets rather than cannibalising the existing pie,” says a broker.
8 Singapore companies make it to Forbes' "Best under a billion' list
Eight Singapore companies made it to this year's Forbes' "Best Under A Billion" list, up from the five that were included in the previous year's list.
Related story:
» Singapore's 40 richest in 2010
The yearly list highlights the 200 top-performing small and medium enterprise firms from close to 13,000 publicly listed Asia-Pacific companies with actively traded shares and sales between US$5 million ($6.75 million)and US$1 billion.
The final 200 are selected based on earnings growth, sales growth, and shareholders' return on equity in the past 12 months and over three years.
China had the most entries at 71, followed by India at 39. India is the top gainer, with 19 new entries this year.
Singapore's best under a billion
Click on thumbnail to view
Japan, which had 24 entries last year, managed only 2 entries this year due to local domestic woes.
The 200 winning companies will be honored at the Forbes Asia "Best Under A Billion" award ceremony and dinner in Hong Kong on November 23, 2010
Related story:
» Singapore's 40 richest in 2010
The yearly list highlights the 200 top-performing small and medium enterprise firms from close to 13,000 publicly listed Asia-Pacific companies with actively traded shares and sales between US$5 million ($6.75 million)and US$1 billion.
The final 200 are selected based on earnings growth, sales growth, and shareholders' return on equity in the past 12 months and over three years.
China had the most entries at 71, followed by India at 39. India is the top gainer, with 19 new entries this year.
Singapore's best under a billion
Click on thumbnail to view
Japan, which had 24 entries last year, managed only 2 entries this year due to local domestic woes.
The 200 winning companies will be honored at the Forbes Asia "Best Under A Billion" award ceremony and dinner in Hong Kong on November 23, 2010
SMX off the blocks, focuses on getting it right
Siow Li Sen
Wed, Sep 01, 2010
The Business Times
(SINGAPORE) The Singapore Mercantile Exchange (SMX) finally began operations yesterday, after some two years of planning and preparation.
The commodities exchange went live with four contracts: two crude oil benchmarks (euro-denominated Brent Crude, and West Texas Intermediate or WTI); a currency pair (euro-US$ currency futures contract); and the first gold futures contract in Singapore to be settled via physical delivery.
Two more contracts, both currency pairs - US$-Australia dollar and US$-yen - will be launched next, said SMX chief executive Thomas McMahon at a press conference.
SMX founder and vice-chairman Jignesh Shah said the initial focus is on setting up the ecosystem and getting the processes, risk management, research and systems right.
Liquidity will then follow, said Mr Shah, to the key question why SMX will succeed when commodities trading on its rival, the Singapore Exchange (SGX), has met with mixed fortunes.
He said SMX is not setting any volume targets in its first year.
'What's important is not to be chasing the volume; the foundation of any exchange is to have the right regulatory framework, the right risk management processes and systems,' he said.
'Just to share our Indian experience: for the first year, we were among the first 50 but in the sixth year, we are now sixth largest in the world,' said Mr Shah.
The Multi-Commodity Exchange (MCX), set up in 2003 by Mr Shah's Financial Technologies group, today commands about 80 per cent of India's commodities futures market. Last year, it became the world's largest exchange for trading in silver (in terms of the number of futures contracts traded); the second largest for gold, copper and natural gas; and the third largest for oil.
Mr McMahon added SMX is focused on creating the right contracts which meet specific market needs of Asian industry players.
For instance, its gold futures contract is the first physical contract to be settled in Singapore.
He is also confident that SMX's two crude oil contracts will meet market demand, given that Singapore is the third largest oil refining centre in the world.
He noted that, currently, oil traders here could be trading in New York and London but, increasingly, financial sector reform will lead to more scrutiny of cross-border flows.
That means 'splitting the collaterals' will become more difficult as regulators impose more rules, he said.
Mr McMahon also disclosed that 68 firms have expressed interest in becoming SMX members.
Wed, Sep 01, 2010
The Business Times
(SINGAPORE) The Singapore Mercantile Exchange (SMX) finally began operations yesterday, after some two years of planning and preparation.
The commodities exchange went live with four contracts: two crude oil benchmarks (euro-denominated Brent Crude, and West Texas Intermediate or WTI); a currency pair (euro-US$ currency futures contract); and the first gold futures contract in Singapore to be settled via physical delivery.
Two more contracts, both currency pairs - US$-Australia dollar and US$-yen - will be launched next, said SMX chief executive Thomas McMahon at a press conference.
SMX founder and vice-chairman Jignesh Shah said the initial focus is on setting up the ecosystem and getting the processes, risk management, research and systems right.
Liquidity will then follow, said Mr Shah, to the key question why SMX will succeed when commodities trading on its rival, the Singapore Exchange (SGX), has met with mixed fortunes.
He said SMX is not setting any volume targets in its first year.
'What's important is not to be chasing the volume; the foundation of any exchange is to have the right regulatory framework, the right risk management processes and systems,' he said.
'Just to share our Indian experience: for the first year, we were among the first 50 but in the sixth year, we are now sixth largest in the world,' said Mr Shah.
The Multi-Commodity Exchange (MCX), set up in 2003 by Mr Shah's Financial Technologies group, today commands about 80 per cent of India's commodities futures market. Last year, it became the world's largest exchange for trading in silver (in terms of the number of futures contracts traded); the second largest for gold, copper and natural gas; and the third largest for oil.
Mr McMahon added SMX is focused on creating the right contracts which meet specific market needs of Asian industry players.
For instance, its gold futures contract is the first physical contract to be settled in Singapore.
He is also confident that SMX's two crude oil contracts will meet market demand, given that Singapore is the third largest oil refining centre in the world.
He noted that, currently, oil traders here could be trading in New York and London but, increasingly, financial sector reform will lead to more scrutiny of cross-border flows.
That means 'splitting the collaterals' will become more difficult as regulators impose more rules, he said.
Mr McMahon also disclosed that 68 firms have expressed interest in becoming SMX members.
Higher dividends follow firms' return to health
Uma Shankari
Mon, Aug 30, 2010
The Business Times
(SINGAPORE) There were few surprises from companies that reported full-year results in the recent reporting season. Most turned in better earnings or lower losses, in line with the global economic recovery.
And to reward shareholders, many said that they would pay out higher dividends than for 2009, citing improved operating profits and net cash positions.
Data compiled by BT showed that as at 5pm last Friday, 73 companies had reported their financial results for the year ended June 30, 2010. And of these firms, 59 reported profits while the remaining 14 recorded losses.
Most companies (some 74 per cent) performed better this year, either turning in higher profits (36 companies) or lower losses (nine) or is back in the black (nine).
Companies, which generally attributed their better year-on-year showings to the better operating environment, also sought to thank investors for sticking by them through the recent lean times.
Of the 45 companies that turned in either higher profits or moved from losses to profits, close to 70 per cent will pay out higher dividends for FY 2010 compared to the previous year. The six companies with the largest net profits for the financial year ended June 30 - Olam International, Singapore Exchange (SGX), Wing Tai Holdings, GuocoLand, Hsu Fu Chi International and Sim Lian Group - all proposed higher dividends for 2010.
Olam reported exceptionally strong fourth-quarter results, which led to full-year results which were well ahead of expectations. The company will pay a total dividend of 4.5 cents a share this year, up from 3.5 cents in 2009.
Wing Tai will also pay out one cent more - it has proposed a dividend of five cents a share for 2010, up from four cents in 2009.
SGX, which said that the recently ended financial year was its second best since the company listed in November 2000, proposed a final dividend of 15.75 cents per share, bringing the total dividend for FY 2010 to 27 cents per share. In addition, the company's board also increased SGX's base dividend commitment to 16 cents per share effective from FY 2011, payable on a quarterly basis.
Sim Lian Group threw in another treat together with higher dividends; the property firm also proposed a bonus issue to increase its capital base to reflect its growth and business expansion and to give 'due recognition' to shareholders for their continued support. It proposed a dividend of 3.7 cents a share, up from 1.4 cents a year ago.
But perhaps the most sincere gesture came from probe card distribution and services solutions provider Ellipsiz. The firm posted a net loss in 2009 after its factory and office property at Joo Koon Crescent was hit by a fire. Now, it is proposing a special cash dividend of 1.1 cents a share from its one-time income - which was boosted by insurance claim income of $22.3 million - to thank shareholders. This will be paid out on top of a final cash dividend of 0.15 cents.
'We would like to thank our shareholders for your patience and support during the difficult period. Your vote of confidence is important, and we look forward to your continued support,' said Ellipsiz chief executive Melvin Chan.
Last year, Mr Chan said that 2009 was a 'a very difficult year' for the group and no dividends were declared.
Mon, Aug 30, 2010
The Business Times
(SINGAPORE) There were few surprises from companies that reported full-year results in the recent reporting season. Most turned in better earnings or lower losses, in line with the global economic recovery.
And to reward shareholders, many said that they would pay out higher dividends than for 2009, citing improved operating profits and net cash positions.
Data compiled by BT showed that as at 5pm last Friday, 73 companies had reported their financial results for the year ended June 30, 2010. And of these firms, 59 reported profits while the remaining 14 recorded losses.
Most companies (some 74 per cent) performed better this year, either turning in higher profits (36 companies) or lower losses (nine) or is back in the black (nine).
Companies, which generally attributed their better year-on-year showings to the better operating environment, also sought to thank investors for sticking by them through the recent lean times.
Of the 45 companies that turned in either higher profits or moved from losses to profits, close to 70 per cent will pay out higher dividends for FY 2010 compared to the previous year. The six companies with the largest net profits for the financial year ended June 30 - Olam International, Singapore Exchange (SGX), Wing Tai Holdings, GuocoLand, Hsu Fu Chi International and Sim Lian Group - all proposed higher dividends for 2010.
Olam reported exceptionally strong fourth-quarter results, which led to full-year results which were well ahead of expectations. The company will pay a total dividend of 4.5 cents a share this year, up from 3.5 cents in 2009.
Wing Tai will also pay out one cent more - it has proposed a dividend of five cents a share for 2010, up from four cents in 2009.
SGX, which said that the recently ended financial year was its second best since the company listed in November 2000, proposed a final dividend of 15.75 cents per share, bringing the total dividend for FY 2010 to 27 cents per share. In addition, the company's board also increased SGX's base dividend commitment to 16 cents per share effective from FY 2011, payable on a quarterly basis.
Sim Lian Group threw in another treat together with higher dividends; the property firm also proposed a bonus issue to increase its capital base to reflect its growth and business expansion and to give 'due recognition' to shareholders for their continued support. It proposed a dividend of 3.7 cents a share, up from 1.4 cents a year ago.
But perhaps the most sincere gesture came from probe card distribution and services solutions provider Ellipsiz. The firm posted a net loss in 2009 after its factory and office property at Joo Koon Crescent was hit by a fire. Now, it is proposing a special cash dividend of 1.1 cents a share from its one-time income - which was boosted by insurance claim income of $22.3 million - to thank shareholders. This will be paid out on top of a final cash dividend of 0.15 cents.
'We would like to thank our shareholders for your patience and support during the difficult period. Your vote of confidence is important, and we look forward to your continued support,' said Ellipsiz chief executive Melvin Chan.
Last year, Mr Chan said that 2009 was a 'a very difficult year' for the group and no dividends were declared.
Analysis: Japan dilemma as economic dependence on China grows
By Linda Sieg
TOKYO
Thu Sep 2, 2010 12:27am EDT
TOKYO (Reuters) - Japan's growing dependence on China for growth grates with concerns over its expanding military reach, deepening a dilemma over how to engage with its giant neighbor even as the two trade places in economic rankings.
But while the interdependence raises the risks for the world's second- and third-biggest economies if relations sour, it also boosts incentives to keep ties on track.
"It raises the stakes," said Jeffrey Kingston, director of Asian studies at Temple University's Tokyo campus.
"But ... Japan has a clear interest in developing better political and diplomatic relations precisely because of the greater economic interdependence."
News that China had surpassed Japan as the world's second-biggest economy in the second quarter grabbed global headlines in August, underscoring China's rise and deepening pessimism over whether Japan can even keep third place.
Even more telling is Japan's deepening dependence on China's dynamism for growth in a mature economy plagued with an aging, shrinking population and a shortage of policy solutions.
Japan's exports to China topped those to the United States last year, accounting for nearly 20 percent of all its exports.
That figure will probably rise to 35 percent by 2026, when China will likely oust America from the top global spot, said Chi Hung Kwan at Nomura Institute of Capital Markets Research.
Japan's direct investment in China has also soared, exceeding 70 percent of its investment in North America last year, with more and more goods being made for local sale, not export.
"For Japanese companies, China is becoming more and more important, not just as the workshop of the world, but as the market of the world," Kwan said at a luncheon with reporters.
Sino-Japanese relations, long plagued by China's memories of Tokyo's wartime aggression and present rivalry over resources and territory, have warmed since a deep chill in 2001-2006, when then-premier Junichiro Koizumi visited the Yasukuni Shrine, seen by Beijing as a symbol of Japanese militarism.
Last weekend, a delegation of Japanese cabinet ministers met their Chinese counterparts in Beijing for high-level economic talks -- the third such annual dialogue -- and agreed on the need to work together for global growth.
WARY
But even as economic ties deepen, Japan is increasingly wary of China's intentions as it spends more of its wealth on defense and shows growing willingness to project military power.
A survey by the China Daily in August showed that 52.7 percent of Chinese respondents saw Japan as a military threat, while 70.8 percent of Japanese felt the same about China.
"Japan's military budget has been stable for 20 years and China's military budget has grown 20 times in the past 20 years," said Shinichi Kitaoka, University of Tokyo professor who advised the conservative Liberal Democratic Party (LDP) government that was ousted last year by the Democratic Party of Japan (DPJ).
"The big gap may create some imbalances and is already creating imbalances in the East China Sea and South China Sea."
While a panel of experts advising the government as it undertakes a major review of defense policies gave a nod to such concerns, the wording was restrained, a reflection of Japan's dilemma as it balances economic interests with security worries.
"Japan's security position requires an extremely delicate policy. On the one hand, it is important to make sure that the cost of unfriendly, non-peaceful behavior is very costly ... and there has to be a very robust defense posture together with the United States," said Chikako Kawakatsu Ueki, a Waseda University professor.
"At the same time, if you are talking about China, everyone knows that China's well-being as an economic power is important to Japan, to the United States, the region and the globe."
The dilemma is a delicate one for Japan's ruling Democratic Party, which swept to power for the first time a year ago, ousting the LDP after more than 50 years of almost non-stop rule.
The party pledged in its campaign last year to forge a more equal relationship with security ally Washington while improving ties with Asian neighbors including China, sparking concerns in some U.S. circles that it was tilting toward Beijing.
"China is becoming more and more important to Japan year in and year out. Everyone accepts that. The debate is how best to handle this -- engagement or constraint," said Phil Deans, a professor of international affairs at Temple in Tokyo.
"The pressure to pursue both strategies is increasing which is making the contradictions more obvious."
Experts say Japan, distracted by its own economic woes and internecine strife in the ruling party, will likely respond with a mix of reliance on the U.S. military deterrence and beefing up its own forces within the elastic constraints of a pacifist constitution, while pursuing better diplomatic ties with Beijing.
"There are three decisions they can make: contain China, engage China or ... just live in a really uncomfortable situation and hope they don't end with the worst of both worlds," Deans said. "I think maybe they can live in this very difficult place."
(Editing by Sugita Katyal)
TOKYO
Thu Sep 2, 2010 12:27am EDT
TOKYO (Reuters) - Japan's growing dependence on China for growth grates with concerns over its expanding military reach, deepening a dilemma over how to engage with its giant neighbor even as the two trade places in economic rankings.
But while the interdependence raises the risks for the world's second- and third-biggest economies if relations sour, it also boosts incentives to keep ties on track.
"It raises the stakes," said Jeffrey Kingston, director of Asian studies at Temple University's Tokyo campus.
"But ... Japan has a clear interest in developing better political and diplomatic relations precisely because of the greater economic interdependence."
News that China had surpassed Japan as the world's second-biggest economy in the second quarter grabbed global headlines in August, underscoring China's rise and deepening pessimism over whether Japan can even keep third place.
Even more telling is Japan's deepening dependence on China's dynamism for growth in a mature economy plagued with an aging, shrinking population and a shortage of policy solutions.
Japan's exports to China topped those to the United States last year, accounting for nearly 20 percent of all its exports.
That figure will probably rise to 35 percent by 2026, when China will likely oust America from the top global spot, said Chi Hung Kwan at Nomura Institute of Capital Markets Research.
Japan's direct investment in China has also soared, exceeding 70 percent of its investment in North America last year, with more and more goods being made for local sale, not export.
"For Japanese companies, China is becoming more and more important, not just as the workshop of the world, but as the market of the world," Kwan said at a luncheon with reporters.
Sino-Japanese relations, long plagued by China's memories of Tokyo's wartime aggression and present rivalry over resources and territory, have warmed since a deep chill in 2001-2006, when then-premier Junichiro Koizumi visited the Yasukuni Shrine, seen by Beijing as a symbol of Japanese militarism.
Last weekend, a delegation of Japanese cabinet ministers met their Chinese counterparts in Beijing for high-level economic talks -- the third such annual dialogue -- and agreed on the need to work together for global growth.
WARY
But even as economic ties deepen, Japan is increasingly wary of China's intentions as it spends more of its wealth on defense and shows growing willingness to project military power.
A survey by the China Daily in August showed that 52.7 percent of Chinese respondents saw Japan as a military threat, while 70.8 percent of Japanese felt the same about China.
"Japan's military budget has been stable for 20 years and China's military budget has grown 20 times in the past 20 years," said Shinichi Kitaoka, University of Tokyo professor who advised the conservative Liberal Democratic Party (LDP) government that was ousted last year by the Democratic Party of Japan (DPJ).
"The big gap may create some imbalances and is already creating imbalances in the East China Sea and South China Sea."
While a panel of experts advising the government as it undertakes a major review of defense policies gave a nod to such concerns, the wording was restrained, a reflection of Japan's dilemma as it balances economic interests with security worries.
"Japan's security position requires an extremely delicate policy. On the one hand, it is important to make sure that the cost of unfriendly, non-peaceful behavior is very costly ... and there has to be a very robust defense posture together with the United States," said Chikako Kawakatsu Ueki, a Waseda University professor.
"At the same time, if you are talking about China, everyone knows that China's well-being as an economic power is important to Japan, to the United States, the region and the globe."
The dilemma is a delicate one for Japan's ruling Democratic Party, which swept to power for the first time a year ago, ousting the LDP after more than 50 years of almost non-stop rule.
The party pledged in its campaign last year to forge a more equal relationship with security ally Washington while improving ties with Asian neighbors including China, sparking concerns in some U.S. circles that it was tilting toward Beijing.
"China is becoming more and more important to Japan year in and year out. Everyone accepts that. The debate is how best to handle this -- engagement or constraint," said Phil Deans, a professor of international affairs at Temple in Tokyo.
"The pressure to pursue both strategies is increasing which is making the contradictions more obvious."
Experts say Japan, distracted by its own economic woes and internecine strife in the ruling party, will likely respond with a mix of reliance on the U.S. military deterrence and beefing up its own forces within the elastic constraints of a pacifist constitution, while pursuing better diplomatic ties with Beijing.
"There are three decisions they can make: contain China, engage China or ... just live in a really uncomfortable situation and hope they don't end with the worst of both worlds," Deans said. "I think maybe they can live in this very difficult place."
(Editing by Sugita Katyal)
Asian Stocks Rise for Third Day on U.S. Home Sales, Falling Jobless Claim
By Jonathan Burgos and Norie Kuboyama - Sep 3, 2010 12:42 PM GMT+0800
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Play VideoSept. 2 (Bloomberg) -- John Vail, chief global strategist at Nikko Asset Management, talks about equity investment opportunities in Japan and the impact of the strengthening yen on strategy. He speaks with Mark Barton on Bloomberg Television's "Countdown." (Source: Bloomberg)
Play VideoSept. 2 (Bloomberg) -- Bloomberg's Elizabeth Faublas reports on the performance of the U.S. equity market today. U.S. stocks rose, with the Standard & Poor’s 500 Index building on its biggest rally in almost two months, after retail sales improved, initial jobless claims fell and pending home sales unexpectedly increased. Bloomberg's Pimm Fox also speaks. (Source: Bloomberg)
Most Asian stocks rose, led by technology companies, after U.S. reports showed an unexpected increase in pending home sales and improved retail sales.
Sony Corp., the electronics maker that gets 22 percent of sales from the U.S., rose 1.6 percent. James Hardie Industries SE, the biggest seller of home siding in the U.S., climbed 4.4 percent in Sydney. Toyota Motor Corp., an automaker that earns about 70 percent of its revenue abroad, increased 1.2 percent. OZ Minerals Ltd., an Australian copper and gold producer, surged 5 percent as commodity prices advanced.
“Investors are kind of relieved because a downward spiral in the global economy had a pause this week,” said Naoki Fujiwara, who helps oversee about $6 billion in Tokyo at Shinkin Asset Management Co. “But investors won’t jump into buying shares just because of that, since there is still a strong sense of uncertainty.”
The MSCI Asia Pacific Index gained 0.3 percent to 119.63 as of 1:39 p.m. in Tokyo, extending its advanced for a third day. The gauge advanced 2.4 percent this week after Japan’s government said it’s preparing a new stimulus plan to help businesses threatened by the strong yen and as reports showed Chinese and U.S. manufacturing, as well as the Australian economy, grew faster than economists estimated.
Japan’s Nikkei 225 Stock Average gained 0.6 percent. Taiwan’s Taiex Index climbed 1.3 percent, the most among Asia Pacific major gauges as the nation’s technology companies rallied.
South Korea’s Kospi Index and Hong Kong’s Hang Seng Index rose at least 0.1 percent. New Zealand’s NZX 50 Index increased 0.7 percent.
Chain Store Data
Futures on the Standard & Poor’s 500 Index fell 0.2 percent today. In New York yesterday, the index increased 0.9 percent, rounding out its biggest two-day gain since early July, after a report showed pending sales of existing U.S. houses climbed 5.2 percent in July, compared with a 1 percent drop economists had estimated in a Bloomberg survey.
Same-store sales at 30 U.S. retail chains probably rose 3.5 percent in August, according to Retail Metrics Inc., beating analysts’ estimates of 2.8 percent.
“The excessive pessimism about the U.S. economy is coming to a halt,” said Juichi Wako, a senior strategist at Tokyo- based Nomura Holdings Inc. “The market was totally pessimistic, but a ray of sunlight has come out this week.”
Exporters Advance
Sony, the maker of Bravia televisions, climbed 1.6 percent to 2,466 yen. Canon Inc., a Japanese camera maker that gets 28 percent of its revenue from the Americas, rose 0.9 percent to 3,535 yen. James Hardie, which counts the U.S. as its biggest market, climbed 4.4 percent to A$5.51 in Sydney.
Japanese exporters also increased as the yen depreciated to as low as 84.43 against the dollar today in Tokyo, compared with 84.17 at the close of stock trading yesterday. A weaker yen boosts overseas income at Japanese companies when converted into their home currency.
Toyota Motor, the world’s biggest automaker, gained 1.2 percent to 2,885 yen. Toshiba Corp., the world’s second-biggest maker of flash memory, advanced 0.8 percent to 387 yen.
The MSCI Asia Pacific Index has declined 2.2 percent from a three-month high on Aug. 6 as the yen’s advance to a 15-year high against the dollar and disappointing U.S. data fueled global growth concerns. U.S. government reports released last month showed orders for durable goods increased less than forecast in July and companies hired fewer workers in the same month.
Tech Stocks Climb
Stocks on the MSCI gauge are valued at an average 13.7 times estimated earnings, compared with 13.1 times for the S&P 500 Index and 11.6 times for the Stoxx Europe 600 Index.
A measure of technology companies posted the biggest advance among the 10 industry groups in the MSCI index amid expectations demand will increase.
In Taipei, Realtek Semiconductor Corp., a maker of chips used in computers, surged 6.9 percent, the second-biggest advance on the MSCI Asia Pacific Index, to NT$67.9. Investors are speculating revenue will rise this month, said Lucas Chen, an analyst at Polaris Securities Co.
Chimei Innolux Corp., Taiwan’s largest maker of liquid- crystal displays, advanced 6.9 percent to NT$35.75, amid speculation fourth-quarter demand for consumer electronics will improve from the previous three months, said Richard Ko, an analyst at Jih Sun Securities Co.
Esprit Declines
PT Indosat, Indonesia’s second-biggest phone operator, surged 7.1 percent to 4,900 rupiah after Deustche Bank AG raised the stock to “hold’ from “sell.”
Raw-material producers climbed after crude oil for October delivery rose 1.5 percent yesterday in New York. The London Metal Exchange Index of six metals including aluminum and copper advanced for a second day yesterday to the highest level since April 30.
OZ Minerals Ltd., which has mines in Africa and Asia, climbed 5 percent to A$1.37, its highest level since October 2008, in Sydney. Mitsubishi Corp., Japan’s biggest commodities trader, rose 0.7 percent to 1,840 yen. Inpex Corp., Japan’s largest oil explorer, climbed 1.4 percent to 406,000 yen.
Among stocks that declined today, Esprit Holdings Ltd., the biggest clothier listed in Hong Kong, tumbled 5.2 percent to HK$40.65 after JPMorgan Chase & Co and CIMB Group Holdings Bhd. cut their ratings on the stock. The company yesterday reported full-year earnings that missed analysts’ estimates.
To contact the reporters on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net; Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net
Email Share
Business ExchangeTwitterDeliciousDiggFacebookLinkedInNewsvinePropellerYahoo! BuzzPrint
Play VideoSept. 2 (Bloomberg) -- John Vail, chief global strategist at Nikko Asset Management, talks about equity investment opportunities in Japan and the impact of the strengthening yen on strategy. He speaks with Mark Barton on Bloomberg Television's "Countdown." (Source: Bloomberg)
Play VideoSept. 2 (Bloomberg) -- Bloomberg's Elizabeth Faublas reports on the performance of the U.S. equity market today. U.S. stocks rose, with the Standard & Poor’s 500 Index building on its biggest rally in almost two months, after retail sales improved, initial jobless claims fell and pending home sales unexpectedly increased. Bloomberg's Pimm Fox also speaks. (Source: Bloomberg)
Most Asian stocks rose, led by technology companies, after U.S. reports showed an unexpected increase in pending home sales and improved retail sales.
Sony Corp., the electronics maker that gets 22 percent of sales from the U.S., rose 1.6 percent. James Hardie Industries SE, the biggest seller of home siding in the U.S., climbed 4.4 percent in Sydney. Toyota Motor Corp., an automaker that earns about 70 percent of its revenue abroad, increased 1.2 percent. OZ Minerals Ltd., an Australian copper and gold producer, surged 5 percent as commodity prices advanced.
“Investors are kind of relieved because a downward spiral in the global economy had a pause this week,” said Naoki Fujiwara, who helps oversee about $6 billion in Tokyo at Shinkin Asset Management Co. “But investors won’t jump into buying shares just because of that, since there is still a strong sense of uncertainty.”
The MSCI Asia Pacific Index gained 0.3 percent to 119.63 as of 1:39 p.m. in Tokyo, extending its advanced for a third day. The gauge advanced 2.4 percent this week after Japan’s government said it’s preparing a new stimulus plan to help businesses threatened by the strong yen and as reports showed Chinese and U.S. manufacturing, as well as the Australian economy, grew faster than economists estimated.
Japan’s Nikkei 225 Stock Average gained 0.6 percent. Taiwan’s Taiex Index climbed 1.3 percent, the most among Asia Pacific major gauges as the nation’s technology companies rallied.
South Korea’s Kospi Index and Hong Kong’s Hang Seng Index rose at least 0.1 percent. New Zealand’s NZX 50 Index increased 0.7 percent.
Chain Store Data
Futures on the Standard & Poor’s 500 Index fell 0.2 percent today. In New York yesterday, the index increased 0.9 percent, rounding out its biggest two-day gain since early July, after a report showed pending sales of existing U.S. houses climbed 5.2 percent in July, compared with a 1 percent drop economists had estimated in a Bloomberg survey.
Same-store sales at 30 U.S. retail chains probably rose 3.5 percent in August, according to Retail Metrics Inc., beating analysts’ estimates of 2.8 percent.
“The excessive pessimism about the U.S. economy is coming to a halt,” said Juichi Wako, a senior strategist at Tokyo- based Nomura Holdings Inc. “The market was totally pessimistic, but a ray of sunlight has come out this week.”
Exporters Advance
Sony, the maker of Bravia televisions, climbed 1.6 percent to 2,466 yen. Canon Inc., a Japanese camera maker that gets 28 percent of its revenue from the Americas, rose 0.9 percent to 3,535 yen. James Hardie, which counts the U.S. as its biggest market, climbed 4.4 percent to A$5.51 in Sydney.
Japanese exporters also increased as the yen depreciated to as low as 84.43 against the dollar today in Tokyo, compared with 84.17 at the close of stock trading yesterday. A weaker yen boosts overseas income at Japanese companies when converted into their home currency.
Toyota Motor, the world’s biggest automaker, gained 1.2 percent to 2,885 yen. Toshiba Corp., the world’s second-biggest maker of flash memory, advanced 0.8 percent to 387 yen.
The MSCI Asia Pacific Index has declined 2.2 percent from a three-month high on Aug. 6 as the yen’s advance to a 15-year high against the dollar and disappointing U.S. data fueled global growth concerns. U.S. government reports released last month showed orders for durable goods increased less than forecast in July and companies hired fewer workers in the same month.
Tech Stocks Climb
Stocks on the MSCI gauge are valued at an average 13.7 times estimated earnings, compared with 13.1 times for the S&P 500 Index and 11.6 times for the Stoxx Europe 600 Index.
A measure of technology companies posted the biggest advance among the 10 industry groups in the MSCI index amid expectations demand will increase.
In Taipei, Realtek Semiconductor Corp., a maker of chips used in computers, surged 6.9 percent, the second-biggest advance on the MSCI Asia Pacific Index, to NT$67.9. Investors are speculating revenue will rise this month, said Lucas Chen, an analyst at Polaris Securities Co.
Chimei Innolux Corp., Taiwan’s largest maker of liquid- crystal displays, advanced 6.9 percent to NT$35.75, amid speculation fourth-quarter demand for consumer electronics will improve from the previous three months, said Richard Ko, an analyst at Jih Sun Securities Co.
Esprit Declines
PT Indosat, Indonesia’s second-biggest phone operator, surged 7.1 percent to 4,900 rupiah after Deustche Bank AG raised the stock to “hold’ from “sell.”
Raw-material producers climbed after crude oil for October delivery rose 1.5 percent yesterday in New York. The London Metal Exchange Index of six metals including aluminum and copper advanced for a second day yesterday to the highest level since April 30.
OZ Minerals Ltd., which has mines in Africa and Asia, climbed 5 percent to A$1.37, its highest level since October 2008, in Sydney. Mitsubishi Corp., Japan’s biggest commodities trader, rose 0.7 percent to 1,840 yen. Inpex Corp., Japan’s largest oil explorer, climbed 1.4 percent to 406,000 yen.
Among stocks that declined today, Esprit Holdings Ltd., the biggest clothier listed in Hong Kong, tumbled 5.2 percent to HK$40.65 after JPMorgan Chase & Co and CIMB Group Holdings Bhd. cut their ratings on the stock. The company yesterday reported full-year earnings that missed analysts’ estimates.
To contact the reporters on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net; Norie Kuboyama in Tokyo at nkuboyama@bloomberg.net
Tuesday, August 31, 2010
US Stocks Climb, Boosted By Consumer Confidence
By Kristina Peterson
NEW YORK (MarketWatch) -- U.S. stocks erased early losses on Tuesday as a better-than-expected reading of consumer confidence provided some encouragement to investors bracing for slower economic growth.
The Dow Jones Industrial Average rose 43 points, reclaiming the 10000 level. Stocks wiped out an early decline, following after consumer confidence increased more than expected in August, raising expectations about future economic activity.
"Housing is continuing to be really weak. The jobs market is the thing the market's most concerned about," said Bill Vaughn, portfolio manager at Evercore Wealth Management, who said the economy still seems to be haltingly improving in a "stair-step" fashion.
"That's a normal pattern whether it's the macro-economy or the market," he said.
Heading into the final day of August, key indexes are on track for a month of steep losses. The Dow has shed nearly 4.1% this month, its first down August in five years. This month is on track to be the blue-chip measure's worst August since 2001.
Small-capitalization stocks have taken an even bigger hit this month. The Russell 2000 index of small-cap stocks is on pace to post its worst August performance in 12 years.
The market weathered mixed housing and manufacturing data earlier in the morning, helping benchmark indexes stay above key support levels. The Standard & Poor's 500-share index rose 0.3% to 1052, after bouncing off the key 1040 level. The Nasdaq Composite gained 0.2% to 2123.
The Dow was recently up 0.3% to 10045, boosted by a 1.9% rise in Caterpillar.
However, technology components weakened after technology researcher Gartner cut its 2010 projection for worldwide personal-computer shipments, saying the second half won't be a strong as it previously expected. Intel fell 0.7%, while Cisco Systems shed 0.2%.
Continuing the buzz around recent deal activity, luxury-fashion retailer Saks rallied 23%. Saks' climb was fueled by speculation that a private-equity consortium is preparing a cash bid of $1.7 billion, or $11 a share, for the retailer, according to the Daily Mail newspaper, citing unidentified sources. A Saks spokesman couldn't immediately be reached for comment.
Food-processing company H.J. Heinz rose 1% after projecting first-quarter earnings above analysts' recent views as the food-processing company said results again were driven by emerging markets.
Biotech agribusiness company Monsanto dropped 4.6% after predicting its fiscal-year earnings will come in at the low end of its prior view.
Investors fretting over the pace of the economic recovery have been closely focused on the Federal Reserve's assessment of the economy. In the early afternoon, the central bank will release the minutes from the Aug. 10 meeting of the Federal Open Market Committee.
The U.S. dollar weakened against both the euro and the yen. The euro was trading recently at $1.2724, up from $1.2665 late Monday in New York. Demand for Treasurys was mixed, with the two-year note flat and the 10-year note up to push its yield down to 2.51%. Crude-oil prices edged down, while gold futures advanced.
NEW YORK (MarketWatch) -- U.S. stocks erased early losses on Tuesday as a better-than-expected reading of consumer confidence provided some encouragement to investors bracing for slower economic growth.
The Dow Jones Industrial Average rose 43 points, reclaiming the 10000 level. Stocks wiped out an early decline, following after consumer confidence increased more than expected in August, raising expectations about future economic activity.
"Housing is continuing to be really weak. The jobs market is the thing the market's most concerned about," said Bill Vaughn, portfolio manager at Evercore Wealth Management, who said the economy still seems to be haltingly improving in a "stair-step" fashion.
"That's a normal pattern whether it's the macro-economy or the market," he said.
Heading into the final day of August, key indexes are on track for a month of steep losses. The Dow has shed nearly 4.1% this month, its first down August in five years. This month is on track to be the blue-chip measure's worst August since 2001.
Small-capitalization stocks have taken an even bigger hit this month. The Russell 2000 index of small-cap stocks is on pace to post its worst August performance in 12 years.
The market weathered mixed housing and manufacturing data earlier in the morning, helping benchmark indexes stay above key support levels. The Standard & Poor's 500-share index rose 0.3% to 1052, after bouncing off the key 1040 level. The Nasdaq Composite gained 0.2% to 2123.
The Dow was recently up 0.3% to 10045, boosted by a 1.9% rise in Caterpillar.
However, technology components weakened after technology researcher Gartner cut its 2010 projection for worldwide personal-computer shipments, saying the second half won't be a strong as it previously expected. Intel fell 0.7%, while Cisco Systems shed 0.2%.
Continuing the buzz around recent deal activity, luxury-fashion retailer Saks rallied 23%. Saks' climb was fueled by speculation that a private-equity consortium is preparing a cash bid of $1.7 billion, or $11 a share, for the retailer, according to the Daily Mail newspaper, citing unidentified sources. A Saks spokesman couldn't immediately be reached for comment.
Food-processing company H.J. Heinz rose 1% after projecting first-quarter earnings above analysts' recent views as the food-processing company said results again were driven by emerging markets.
Biotech agribusiness company Monsanto dropped 4.6% after predicting its fiscal-year earnings will come in at the low end of its prior view.
Investors fretting over the pace of the economic recovery have been closely focused on the Federal Reserve's assessment of the economy. In the early afternoon, the central bank will release the minutes from the Aug. 10 meeting of the Federal Open Market Committee.
The U.S. dollar weakened against both the euro and the yen. The euro was trading recently at $1.2724, up from $1.2665 late Monday in New York. Demand for Treasurys was mixed, with the two-year note flat and the 10-year note up to push its yield down to 2.51%. Crude-oil prices edged down, while gold futures advanced.
Mr Obama - Biggest Bad move of the year? I feel you are.
Obama Blows Off 3 Billion Wannabe Billionaires: William Pesek
By William Pesek - Aug 30, 2010 3:00 AM GMT+0800
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William Pesek
For a guy who talked big about re- engaging Asia, Barack Obama has a funny way of showing it.
Nobody doubts the U.S. president’s team is supremely busy juggling oil spills, Muslim cultural centers, convincing ignoramuses he has a birth certificate and averting recession. Yet there’s no excuse for blowing off last week’s Association of Southeast Asian Nations trade meeting in Vietnam.
It was a dreadful decision and its significance didn’t escape members of the fourth-biggest market for U.S. goods. This is no time for the U.S. to be taking the most dynamic economies for granted. Not with China becoming an ever-bigger player both in Asia and globally.
On any list of George W. Bush’s failings, ignoring Asia deserves a prominent mention. When his administration bothered with Asia, it was all terrorism all the time. There was little talk about potential, cooperation or partnership. Bush just wanted to know how many bad guys governments were rounding up.
He tried to make amends in the twilight of his presidency, naming a U.S. ambassador to Asean in 2008. Recently, Obama tapped that official, Scot Marciel, to be U.S. ambassador to Indonesia. Obama hasn’t bothered to name a new Asean envoy.
The U.S. missed a timely opportunity last week to confer with the economic ministers of Asean’s 10 members, along with counterparts from Australia, China, India, Japan, South Korea, New Zealand and Russia.
Blowing Off Asia
At a time of global crisis, one the U.S. caused, does Obama really want to be sending a message of indifference to Asia? Coming a week after the announcement that China’s economy has surpassed Japan’s, the U.S.’s closest Asian ally, you would think the White House would be stepping up a charm offensive. Instead, it risks turning off the region.
“Confidence in the United States and its ability to lead and follow through on commitments is based on its economic well- being, and that status is being questioned by friends and competitors alike in Asia,” Ernest Bower, an analyst at the Center for Strategic and International Studies in Washington, wrote in a recent report.
China’s rapid growth is slowly, but surely, chipping away at the U.S.’s importance. Granted, at almost three times China’s economy, the U.S. will long be a vital customer for Asia’s goods. Officials here also know that depending on growth in a developing economy is risky.
U.S. Brand
Yet neglecting future trade ties with the liveliest economies is just plain dumb. Asia is churning out a fast- growing number of billionaires and is home to 3 billion consumers who aspire to join them. The U.S. wants to be in on that process.
Obama must not forget just how much the 2008 meltdown damaged the U.S. brand. During Asia’s 1990s crisis, U.S. officials preached the free-market gospel. They told leaders to raise interest rates to support currencies, slash spending and debt, scrap subsidies and avoid bailing out industries. When the U.S. faced a crisis, it did exactly the opposite.
There’s also considerable grumbling over the dollar. True or not, the theory that the U.S. is devaluing to help exporters is making the rounds. That perception is a problem if you want China to let its currency strengthen. It doesn’t play well in Japan, where panic is rising over the strong yen.
Nor can the U.S. complain about corruption in Asia. Incestuous ties between Washington and Wall Street helped cause the U.S. crisis. Conflicts of interest between regulators and oil companies led to BP Plc’s devastating Gulf of Mexico leak. The U.S. has little moral high ground on dodgy dealings.
Corruption’s Cost
That’s a shame, considering the magnitude of Asia’s corruption fight. In Indonesia, for example, officials face an uphill battle to weed out graft and allow more of the nation’s people to benefit from 6 percent growth.
In the Philippines, the honeymoon enjoyed by Benigno Aquino, since becoming president in June, ended last week in gunfire. Eight Hong Kong tourists being held hostage in Manila died in a botched rescue attempt. The tragedy was emblematic of what plagues the nation’s economy.
The gunman was a former police inspector who was dismissed on allegations of extortion. The standoff’s surreal finale suggested a breakdown in the nation’s security apparatus, ineptness at many levels and weak diplomacy. Corruption is the common link in all these shortcomings.
Lost Opportunity
Obama got off to a good start, becoming the first U.S. leader to meet with Asean in November. Vietnam was the perfect opportunity to go further -- to discuss views on credit markets, North Korea’s provocations, China’s currency, Australia’s election, Russia’s growth prospects, and Japanese deflation.
This last topic is a growing concern. Not only have consumer prices fallen for 17 consecutive months, but Japan now has a leadership battle on its hands. Prime Minister Naoto Kan faces a challenge to remain head of the ruling party by veteran kingmaker Ichiro Ozawa. It’s the last thing Japan needs: its sixth prime minister in three years.
Obama’s team could have learned about all of this, and much more, if it had only shown up in Asia. It should do so as soon as possible.
(William Pesek is a Bloomberg News columnist. The opinions expressed are his own.)
To contact the writer of this column: William Pesek in Tokyo at wpesek@bloomberg.net
By William Pesek - Aug 30, 2010 3:00 AM GMT+0800
Email Share
Business ExchangeTwitterDeliciousDiggFacebookLinkedInNewsvinePropellerYahoo! BuzzPrint Bloomberg Opinion
William Pesek
For a guy who talked big about re- engaging Asia, Barack Obama has a funny way of showing it.
Nobody doubts the U.S. president’s team is supremely busy juggling oil spills, Muslim cultural centers, convincing ignoramuses he has a birth certificate and averting recession. Yet there’s no excuse for blowing off last week’s Association of Southeast Asian Nations trade meeting in Vietnam.
It was a dreadful decision and its significance didn’t escape members of the fourth-biggest market for U.S. goods. This is no time for the U.S. to be taking the most dynamic economies for granted. Not with China becoming an ever-bigger player both in Asia and globally.
On any list of George W. Bush’s failings, ignoring Asia deserves a prominent mention. When his administration bothered with Asia, it was all terrorism all the time. There was little talk about potential, cooperation or partnership. Bush just wanted to know how many bad guys governments were rounding up.
He tried to make amends in the twilight of his presidency, naming a U.S. ambassador to Asean in 2008. Recently, Obama tapped that official, Scot Marciel, to be U.S. ambassador to Indonesia. Obama hasn’t bothered to name a new Asean envoy.
The U.S. missed a timely opportunity last week to confer with the economic ministers of Asean’s 10 members, along with counterparts from Australia, China, India, Japan, South Korea, New Zealand and Russia.
Blowing Off Asia
At a time of global crisis, one the U.S. caused, does Obama really want to be sending a message of indifference to Asia? Coming a week after the announcement that China’s economy has surpassed Japan’s, the U.S.’s closest Asian ally, you would think the White House would be stepping up a charm offensive. Instead, it risks turning off the region.
“Confidence in the United States and its ability to lead and follow through on commitments is based on its economic well- being, and that status is being questioned by friends and competitors alike in Asia,” Ernest Bower, an analyst at the Center for Strategic and International Studies in Washington, wrote in a recent report.
China’s rapid growth is slowly, but surely, chipping away at the U.S.’s importance. Granted, at almost three times China’s economy, the U.S. will long be a vital customer for Asia’s goods. Officials here also know that depending on growth in a developing economy is risky.
U.S. Brand
Yet neglecting future trade ties with the liveliest economies is just plain dumb. Asia is churning out a fast- growing number of billionaires and is home to 3 billion consumers who aspire to join them. The U.S. wants to be in on that process.
Obama must not forget just how much the 2008 meltdown damaged the U.S. brand. During Asia’s 1990s crisis, U.S. officials preached the free-market gospel. They told leaders to raise interest rates to support currencies, slash spending and debt, scrap subsidies and avoid bailing out industries. When the U.S. faced a crisis, it did exactly the opposite.
There’s also considerable grumbling over the dollar. True or not, the theory that the U.S. is devaluing to help exporters is making the rounds. That perception is a problem if you want China to let its currency strengthen. It doesn’t play well in Japan, where panic is rising over the strong yen.
Nor can the U.S. complain about corruption in Asia. Incestuous ties between Washington and Wall Street helped cause the U.S. crisis. Conflicts of interest between regulators and oil companies led to BP Plc’s devastating Gulf of Mexico leak. The U.S. has little moral high ground on dodgy dealings.
Corruption’s Cost
That’s a shame, considering the magnitude of Asia’s corruption fight. In Indonesia, for example, officials face an uphill battle to weed out graft and allow more of the nation’s people to benefit from 6 percent growth.
In the Philippines, the honeymoon enjoyed by Benigno Aquino, since becoming president in June, ended last week in gunfire. Eight Hong Kong tourists being held hostage in Manila died in a botched rescue attempt. The tragedy was emblematic of what plagues the nation’s economy.
The gunman was a former police inspector who was dismissed on allegations of extortion. The standoff’s surreal finale suggested a breakdown in the nation’s security apparatus, ineptness at many levels and weak diplomacy. Corruption is the common link in all these shortcomings.
Lost Opportunity
Obama got off to a good start, becoming the first U.S. leader to meet with Asean in November. Vietnam was the perfect opportunity to go further -- to discuss views on credit markets, North Korea’s provocations, China’s currency, Australia’s election, Russia’s growth prospects, and Japanese deflation.
This last topic is a growing concern. Not only have consumer prices fallen for 17 consecutive months, but Japan now has a leadership battle on its hands. Prime Minister Naoto Kan faces a challenge to remain head of the ruling party by veteran kingmaker Ichiro Ozawa. It’s the last thing Japan needs: its sixth prime minister in three years.
Obama’s team could have learned about all of this, and much more, if it had only shown up in Asia. It should do so as soon as possible.
(William Pesek is a Bloomberg News columnist. The opinions expressed are his own.)
To contact the writer of this column: William Pesek in Tokyo at wpesek@bloomberg.net
Monday, August 30, 2010
First China Shopping Mall S-REIT
CAPITARETAIL CHINA TRUST (CRCT)
First China Shopping Mall S-REIT
Presentation Slides for US NDR
30 August – 2 September 2010
First China Shopping Mall S-REIT
Presentation Slides for US NDR
30 August – 2 September 2010
Singapore Tightens Loan Limits to Cool Housing Market
Singapore increased down payments for second mortgages and imposed a stamp duty on property held for less than three years to curb speculation after home prices surged 38 percent in the second quarter.
Buyers who hold more than one mortgage can only borrow up to 70 percent of a property’s value, versus 80 percent previously, and must pay 10 percent in cash, up from 5 percent, the government said in a statement today. A seller’s stamp duty will apply to all residential units and land sold within three years of purchase, from one year. The changes take effect today.
Singapore joins Hong Kong and China in introducing measures this year to cool their property markets amid concerns that asset bubbles are forming as home prices surge. Hong Kong said this month it will tighten mortgage lending rules and increase the supply of land, while China’s restrictions include higher down payments and mortgage rates for multiple-home buyers.
“The government is taking a preemptive approach to make sure prices don’t get out of hand,” said Donald Han, a Singapore-based managing director at real estate adviser Cushman & Wakefield Inc. “Most of the measures are really targeting repeat buyers and speculators who buy and sell over the short term, which is now defined as within three years.”
Stocks, Bonds
CapitaLand Ltd., Southeast Asia’s biggest developer, dropped 1 percent to S$3.96 as of 1:15 p.m. in Singapore trading, while the benchmark Straits Times Index rose 0.6 percent. City Developments Ltd., the island’s second-largest developer by market value, fell 3.2 percent to S$11.58, headed for its biggest decline since February.
CapitaLand’s S$250 million ($185 million) in 4.35 percent notes due 2019 fell to 101.88 cents on the dollar from 102.48 cents on Aug. 27, the lowest in about two weeks, according to Standard Chartered Plc prices. City Developments’ S$90 million in 2.92 percent notes due 2014 fell to 101.68 cents, the lowest since Aug. 10, according to DBS Group Holdings Ltd.
Property prices have surged as Singapore’s $182 billion economy rebounded from last year’s global slump to expand at a record 17.9 percent pace in the six months through June.
The city-state has been attempting to rein in home prices since last year when the government barred interest-only loans for some housing projects and stopped allowing developers to absorb interest payments for apartments still being built.
Previous Measures
The government in February said it will levy a seller’s stamp duty on all residential properties and land that are sold within one year from the date of purchase. The city-state then also lowered the loan-to-value limit to 80 percent from 90 percent for all housing loans provided by financial institutions regulated by the Monetary Authority of Singapore.
The island nation’s Prime Minister Lee Hsien Loong yesterday said previous measures failed to keep prices in check.
“We twice attempted to cool the property market, once last year and once in February this year, but the prices are still rising,” Lee said in a televised speech. “Our purpose is to make sure in the long term, Singaporeans can own their homes and afford it and it will be a gradually appreciating asset which will grow as Singapore grows.”
Singapore’s property market would form a bubble if the current momentum continued, Mah Bow Tan, Minister of National Development, said today after the measures.
Prices Surge
“The property market is currently very buoyant,” the government said in the latest statement. “The government’s objective is to ensure a stable and sustainable property market where prices move in line with economic fundamentals.”
Singapore private residential prices rose 38 percent in the second quarter from a year earlier, according to the Urban Redevelopment Authority.
The island led 36 markets around the world in property- value changes last quarter, gaining 34 percent from a year earlier, according to the Global Property Guide in its survey of house prices.
Price levels have exceeded the historical peak in the second quarter of 1996, the government said today.
The government expects gross domestic product to grow 13 percent to 15 percent this year after the nation in 2009 exited its worst recession since independence 45 years ago.
‘Severe Implications’
“Should economic growth falter and the market corrects, property buyers could face capital losses, with implications on their own finances and the economy as a whole,” the government said. “Moreover, the current low global interest rate environment will not continue indefinitely, and higher interest rates could have severe implications for buyers who have overextended themselves.”
Hong Kong Aug. 13 raised down payments for apartments costing HK$12 million ($1.54 million) or more to 40 percent, from 30 percent. The government has been accelerating its auctions of land for development in a bid to cool prices that have soared about 45 percent since the beginning of 2009, boosted by mortgage rates at the lowest in two decades and buying by mainland Chinese.
John Tsang, Hong Kong’s financial secretary, said home prices are approaching the level of 1997, the height of a previous bubble that was followed by a six-year slump.
China, South Korea
In China, the banking regulator has ordered stress tests for lenders to gauge the impact of home prices falling as much as 60 percent in the hardest-hit markets, a person with knowledge of the matter said. China’s property prices rose at the slowest pace in six months in July as the government cracked down on speculation to prevent asset bubbles.
China has restricted pre-sales by developers, curbed loans for third-home purchases, raised minimum mortgage rates and tightened down-payment requirements for multiple-home purchases. It has also instructed lenders to halt third-home loans in areas with “excessive price gains.”
Taiwan in June introduced a 70 percent cap on loans for second homes, after low borrowing costs fueled lending and a jump in home prices. Central Bank Governor Perng Fai-nan wrote to the chairmen of all financial institutions on the island last month, asking them to take steps to prevent housing speculation.
Malaysia’s central bank has written to financial institutions to get their feedback on the possibility of capping the loan-to-value ratio for mortgages at 80 percent, the Edge weekly reported Aug. 28, citing unidentified people familiar with the matter.
South Korea may be an exception in Asia as the government steps up measures to spur the property market. The government yesterday said it will ease mortgage lending rules and extend tax breaks to encourage buyers back after home sales slumped to the lowest level in almost a year and a half.
To contact the reporter on this story: Shamim Adam in Singapore at sadam2@bloomberg.net; Joyce Koh in Singapore at jkoh38@bloomberg.net
Buyers who hold more than one mortgage can only borrow up to 70 percent of a property’s value, versus 80 percent previously, and must pay 10 percent in cash, up from 5 percent, the government said in a statement today. A seller’s stamp duty will apply to all residential units and land sold within three years of purchase, from one year. The changes take effect today.
Singapore joins Hong Kong and China in introducing measures this year to cool their property markets amid concerns that asset bubbles are forming as home prices surge. Hong Kong said this month it will tighten mortgage lending rules and increase the supply of land, while China’s restrictions include higher down payments and mortgage rates for multiple-home buyers.
“The government is taking a preemptive approach to make sure prices don’t get out of hand,” said Donald Han, a Singapore-based managing director at real estate adviser Cushman & Wakefield Inc. “Most of the measures are really targeting repeat buyers and speculators who buy and sell over the short term, which is now defined as within three years.”
Stocks, Bonds
CapitaLand Ltd., Southeast Asia’s biggest developer, dropped 1 percent to S$3.96 as of 1:15 p.m. in Singapore trading, while the benchmark Straits Times Index rose 0.6 percent. City Developments Ltd., the island’s second-largest developer by market value, fell 3.2 percent to S$11.58, headed for its biggest decline since February.
CapitaLand’s S$250 million ($185 million) in 4.35 percent notes due 2019 fell to 101.88 cents on the dollar from 102.48 cents on Aug. 27, the lowest in about two weeks, according to Standard Chartered Plc prices. City Developments’ S$90 million in 2.92 percent notes due 2014 fell to 101.68 cents, the lowest since Aug. 10, according to DBS Group Holdings Ltd.
Property prices have surged as Singapore’s $182 billion economy rebounded from last year’s global slump to expand at a record 17.9 percent pace in the six months through June.
The city-state has been attempting to rein in home prices since last year when the government barred interest-only loans for some housing projects and stopped allowing developers to absorb interest payments for apartments still being built.
Previous Measures
The government in February said it will levy a seller’s stamp duty on all residential properties and land that are sold within one year from the date of purchase. The city-state then also lowered the loan-to-value limit to 80 percent from 90 percent for all housing loans provided by financial institutions regulated by the Monetary Authority of Singapore.
The island nation’s Prime Minister Lee Hsien Loong yesterday said previous measures failed to keep prices in check.
“We twice attempted to cool the property market, once last year and once in February this year, but the prices are still rising,” Lee said in a televised speech. “Our purpose is to make sure in the long term, Singaporeans can own their homes and afford it and it will be a gradually appreciating asset which will grow as Singapore grows.”
Singapore’s property market would form a bubble if the current momentum continued, Mah Bow Tan, Minister of National Development, said today after the measures.
Prices Surge
“The property market is currently very buoyant,” the government said in the latest statement. “The government’s objective is to ensure a stable and sustainable property market where prices move in line with economic fundamentals.”
Singapore private residential prices rose 38 percent in the second quarter from a year earlier, according to the Urban Redevelopment Authority.
The island led 36 markets around the world in property- value changes last quarter, gaining 34 percent from a year earlier, according to the Global Property Guide in its survey of house prices.
Price levels have exceeded the historical peak in the second quarter of 1996, the government said today.
The government expects gross domestic product to grow 13 percent to 15 percent this year after the nation in 2009 exited its worst recession since independence 45 years ago.
‘Severe Implications’
“Should economic growth falter and the market corrects, property buyers could face capital losses, with implications on their own finances and the economy as a whole,” the government said. “Moreover, the current low global interest rate environment will not continue indefinitely, and higher interest rates could have severe implications for buyers who have overextended themselves.”
Hong Kong Aug. 13 raised down payments for apartments costing HK$12 million ($1.54 million) or more to 40 percent, from 30 percent. The government has been accelerating its auctions of land for development in a bid to cool prices that have soared about 45 percent since the beginning of 2009, boosted by mortgage rates at the lowest in two decades and buying by mainland Chinese.
John Tsang, Hong Kong’s financial secretary, said home prices are approaching the level of 1997, the height of a previous bubble that was followed by a six-year slump.
China, South Korea
In China, the banking regulator has ordered stress tests for lenders to gauge the impact of home prices falling as much as 60 percent in the hardest-hit markets, a person with knowledge of the matter said. China’s property prices rose at the slowest pace in six months in July as the government cracked down on speculation to prevent asset bubbles.
China has restricted pre-sales by developers, curbed loans for third-home purchases, raised minimum mortgage rates and tightened down-payment requirements for multiple-home purchases. It has also instructed lenders to halt third-home loans in areas with “excessive price gains.”
Taiwan in June introduced a 70 percent cap on loans for second homes, after low borrowing costs fueled lending and a jump in home prices. Central Bank Governor Perng Fai-nan wrote to the chairmen of all financial institutions on the island last month, asking them to take steps to prevent housing speculation.
Malaysia’s central bank has written to financial institutions to get their feedback on the possibility of capping the loan-to-value ratio for mortgages at 80 percent, the Edge weekly reported Aug. 28, citing unidentified people familiar with the matter.
South Korea may be an exception in Asia as the government steps up measures to spur the property market. The government yesterday said it will ease mortgage lending rules and extend tax breaks to encourage buyers back after home sales slumped to the lowest level in almost a year and a half.
To contact the reporter on this story: Shamim Adam in Singapore at sadam2@bloomberg.net; Joyce Koh in Singapore at jkoh38@bloomberg.net
Sold SMRT, Small Profits.
Sold SMRT earning a small profit of SGD18. Enough for me? Yes. I live to trade another day.
I bought some smaller counters. Will reveal when I sold them.
I bought some smaller counters. Will reveal when I sold them.
Starhub target lifted to $2.85 by BNP, keeps Buy
Written by The Edge
Friday, 27 August 2010 12:05
BNP Paribas lifts Starhub (CC3.SG) target price to $2.85 from $2.65, based on discounted cash-flow valuation, after accounting for lower pay-TV churn rate assumption, rolling over valuation base to 2011 vs 2010, says Dow Jones.
BNP says despite losing EPL football broadcast rights to SingTel (Z74.SG), Starhub’s pay-TV churn rate only slightly higher than before EPL loss. “StarHub’s non-sports content remains superior to SingTel’s.” Lowers 2010 pay-TV churn rate estimate to 10% vs 15%. Keeps Buy call.
Notes, “StarHub’s prospective (dividend) yield of 8.5% is attractive, especially in current volatile market environment.”
Friday, 27 August 2010 12:05
BNP Paribas lifts Starhub (CC3.SG) target price to $2.85 from $2.65, based on discounted cash-flow valuation, after accounting for lower pay-TV churn rate assumption, rolling over valuation base to 2011 vs 2010, says Dow Jones.
BNP says despite losing EPL football broadcast rights to SingTel (Z74.SG), Starhub’s pay-TV churn rate only slightly higher than before EPL loss. “StarHub’s non-sports content remains superior to SingTel’s.” Lowers 2010 pay-TV churn rate estimate to 10% vs 15%. Keeps Buy call.
Notes, “StarHub’s prospective (dividend) yield of 8.5% is attractive, especially in current volatile market environment.”
Singapore to spend $60b over next decade on rail network
Written by Bloomberg
Sunday, 29 August 2010 20:59
Singapore will spend $60 billion over the next decade to develop and double its rail network, Prime Minister Lee Hsien Loong said in a televised speech today.
Sunday, 29 August 2010 20:59
Singapore will spend $60 billion over the next decade to develop and double its rail network, Prime Minister Lee Hsien Loong said in a televised speech today.
Mah says property market was heading for a bubble
Singapore’s property market would form a bubble if the current momentum continued, Mah Bow Tan, Minister of National Development, said in Singapore today.
Singapore moves to cool property market
Written by Thomson Reuters
Monday, 30 August 2010 10:09
Singapore on Monday announced restrictions on people buying second homes as part of new measures to cool its residential property market, hurting property stocks.
The new measures, which take immediate effect, include decreasing the amount people can borrow to buy second properties to 70% from 80 perent, as well as extending a stamp duty on sellers who buy and sell within three years.
Monday, 30 August 2010 10:09
Singapore on Monday announced restrictions on people buying second homes as part of new measures to cool its residential property market, hurting property stocks.
The new measures, which take immediate effect, include decreasing the amount people can borrow to buy second properties to 70% from 80 perent, as well as extending a stamp duty on sellers who buy and sell within three years.
Sembcorp plans to issue $200m of notes due 2017, 2025
Written by Bloomberg
Monday, 30 August 2010 12:50
SembCorp Industries plans to sell $200 million of notes under its $1.5 billion medium-term note program, according to a Singapore stock exchange statement.
$100 million of 4.25% bonds will mature in 2025 while a further $100 million of notes which will pay interest of 0.55% more than the six-month Singapore dollar swap offer rate will mature in 2017, the statement said.
Proceeds will be used to repay debt and for general working capital purposes and DBS Group Holdings is managing the sale, the statement said.
Monday, 30 August 2010 12:50
SembCorp Industries plans to sell $200 million of notes under its $1.5 billion medium-term note program, according to a Singapore stock exchange statement.
$100 million of 4.25% bonds will mature in 2025 while a further $100 million of notes which will pay interest of 0.55% more than the six-month Singapore dollar swap offer rate will mature in 2017, the statement said.
Proceeds will be used to repay debt and for general working capital purposes and DBS Group Holdings is managing the sale, the statement said.
Watch 2,955 mark: Phillip Securities
Written by The Edge
Monday, 30 August 2010 13:00
Gains across Asian bourses keeping sentiment in Singapore market generally buoyant, although property stocks buck advance on additional government measures to rein in housing market, says Dow Jones.
Monday, 30 August 2010 13:00
Gains across Asian bourses keeping sentiment in Singapore market generally buoyant, although property stocks buck advance on additional government measures to rein in housing market, says Dow Jones.
Singapore’s DBS consumer head resigns: Update
Written by Thomson Reuters
Monday, 30 August 2010 15:06
DBS’s (DBSM.SI) head of consumer banking, Rajan Raju, has resigned after spending 11 years with Southeast Asia’s biggest lender, sources familiar with the move told Reuters on Monday.
Raju, who joined Singapore’s DBS from Citibank (C.N), will end his current role on Aug 31, His official last day is on Sept 30, according to a staff memo made available to Reuters. His successor will be announced shortly, the memo said. DBS confirmed Raju’s departure.
Monday, 30 August 2010 15:06
DBS’s (DBSM.SI) head of consumer banking, Rajan Raju, has resigned after spending 11 years with Southeast Asia’s biggest lender, sources familiar with the move told Reuters on Monday.
Raju, who joined Singapore’s DBS from Citibank (C.N), will end his current role on Aug 31, His official last day is on Sept 30, according to a staff memo made available to Reuters. His successor will be announced shortly, the memo said. DBS confirmed Raju’s departure.
Wing Tai, CityDev fall on government moves
Written by Thomson Reuters
Monday, 30 August 2010 15:53
Shares of property developers Wing Tai Holdings (WTHS.SI) and City Developments (CTDM.SI) fell more than 4% after the Singapore government announced measures to cool the residential property market.
Wing Tai and City Developments have relatively greater exposures to the mass residential segment of the market.
Monday, 30 August 2010 15:53
Shares of property developers Wing Tai Holdings (WTHS.SI) and City Developments (CTDM.SI) fell more than 4% after the Singapore government announced measures to cool the residential property market.
Wing Tai and City Developments have relatively greater exposures to the mass residential segment of the market.
Saturday, August 28, 2010
STI gains 0.4% to 2,938.74 at closing
Singapore’s Straits Times Index gained 0.4% to 2,938.74 at the close, pushing the gauge 0.1% higher this week. Two stocks rose for each that fell on the 30-member gauge.
Shares on the measure trade at an average 14.2 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to Bloomberg data. The following shares were among the most active in the market.
Shares on the measure trade at an average 14.2 times estimated earnings, compared with about 17.4 times at the beginning of the year, according to Bloomberg data. The following shares were among the most active in the market.
Kian Ann Engineering (KAE SP), a supplier of tractor and diesel engine parts, gained 2.6% to 20 cents. The company said full-year profit increased 15% to $13.2 million from a year earlier.
MCL Land (MCL SP) surged 26% to $2.45, its biggest advance on record, after its parent Hongkong Land Holdings (HKL SP) offered to buy the rest of the Singapore- based homebuilder for $2.45 a share. Hongkong Land, which holds about 77.4% of MCL Land, rose 1.5% to US$5.40 ($7.32).
Olam International (OLAM SP), a Singapore-based supplier of agricultural commodities, jumped 6.8% to $2.68. The company said fourth-quarter net income doubled to $92.3 million from $46.7 million a year earlier. Credit Suisse Group AG raised its share-price estimate to $4.25 from $3.50 and kept its “outperform” rating, saying the company’s earnings beat estimates.
Wilmar International (WIL SP), the world’s biggest palm-oil trader, rose 0.5% to $6.21. The company said its unit PGEO Group agreed to buy the remaining 8.6% of Natural Oleochemicals from National Land Finance Co-operative Society for 42.5 million ringgit ($18.3 million). PGEO last month acquired 91.4% of Natural Oleochemicals from Kulim (Malaysia) Bhd.
Friday, August 27, 2010
Wall St slumps on economy woes; Dow below 10,000
On Friday 27 August 2010, 5:04 SGT
By Leah Schnurr
NEW YORK (Reuters) - U.S. stocks sagged on Thursday and the Dow closed below 10,000 a day ahead of an expected downward revision in U.S. second-quarter economic growth and a major speech by Federal Reserve Chairman Ben Bernanke .
Major technology shares were among the biggest losers, with the Nasdaq falling more than the Dow and S&P 500 . Tech shares have been seen as a proxy for economic growth. Cisco Systems fell 2.4 percent to $20.70, while Intel gave up 1.6 percent at $18.18.
Stocks initially rose on data showing first-time claims for jobless benefits fell more than expected last week, but the number was still too high to signal a shift in the weak labor market. The four-week average of new claims, regarded as a better gauge of trends, rose to the highest since late November.
"The best the bull can say is that the recovery is evening itself out now, it's not accelerating any more," said Linda Duessel, market strategist at Federated Investors in Pittsburgh.
"We think it's a soft patch and not a double dip, but the market is pricing more and more for a double dip, so you're vulnerable to the upside."
The Dow Jones industrial average fell 74.25 points, or 0.74 percent, to 9,985.81. The Standard & Poor's 500 Index shed 8.11 points, or 0.77 percent, to 1,047.22. The Nasdaq Composite Index lost 22.85 points, or 1.07 percent, to 2,118.69.
It was the first time the Dow has closed below the psychologically important 10,000 level since July 6. The market then began a rebound and logged seven straight days of gains.
In his speech on Friday Bernanke is likely to discuss the uncertain prospects for the economy but isn't expected to give many clues about whether the U.S. central bank will pump more cash into the economy to keep the recovery going.
Bernanke and central bankers from around the world are gathering for their annual meeting in Jackson Hole, Wyoming, with the agenda expected to include a discussion of printing yet more money to spur growth.
After a recent spate of poor economic numbers, there were jitters the GDP data could show the economy is weaker than originally thought. The government's preliminary reading is expected to come in at 1.4 percent, down from 2.4 percent estimated a month ago. Estimates range broadly from 0.9 percent to 2.2 percent, according to a Reuters poll.
On the technical picture, investors were still looking for the 1,040 level on the S&P to act as support. Some consider a dip below that level to be a buying opportunity, as was seen on Wednesday when the index briefly fell below it.
In deal news, Dell Inc raised its bid for data storage company 3PAR Inc to $1.6 billion, offering slightly more than bigger rival Hewlett-Packard Co.
HP came back with a revised proposal after the closing bell, sending 3PAR's shares up 7.2 percent to $27.90 in extended-hours trading. Shares of 3PAR closed at $26.76. HP closed down 0.1 percent at $38.22, while Dell ended down 0.3 percent to $11.75
A drop in shares of coal companies weighed on the energy sector for a second day as the price of natural gas fell, raising concerns that power plants would switch to gas from coal. Massey Energy fell 4.2 percent to $27.93, while the S&P energy sector fell 1 percent.
(Reporting by Leah Schnurr; Editing by Kenneth Barry)
(For more news visit Reuters India)
By Leah Schnurr
NEW YORK (Reuters) - U.S. stocks sagged on Thursday and the Dow closed below 10,000 a day ahead of an expected downward revision in U.S. second-quarter economic growth and a major speech by Federal Reserve Chairman Ben Bernanke .
Major technology shares were among the biggest losers, with the Nasdaq falling more than the Dow and S&P 500 . Tech shares have been seen as a proxy for economic growth. Cisco Systems fell 2.4 percent to $20.70, while Intel gave up 1.6 percent at $18.18.
Stocks initially rose on data showing first-time claims for jobless benefits fell more than expected last week, but the number was still too high to signal a shift in the weak labor market. The four-week average of new claims, regarded as a better gauge of trends, rose to the highest since late November.
"The best the bull can say is that the recovery is evening itself out now, it's not accelerating any more," said Linda Duessel, market strategist at Federated Investors in Pittsburgh.
"We think it's a soft patch and not a double dip, but the market is pricing more and more for a double dip, so you're vulnerable to the upside."
The Dow Jones industrial average fell 74.25 points, or 0.74 percent, to 9,985.81. The Standard & Poor's 500 Index shed 8.11 points, or 0.77 percent, to 1,047.22. The Nasdaq Composite Index lost 22.85 points, or 1.07 percent, to 2,118.69.
It was the first time the Dow has closed below the psychologically important 10,000 level since July 6. The market then began a rebound and logged seven straight days of gains.
In his speech on Friday Bernanke is likely to discuss the uncertain prospects for the economy but isn't expected to give many clues about whether the U.S. central bank will pump more cash into the economy to keep the recovery going.
Bernanke and central bankers from around the world are gathering for their annual meeting in Jackson Hole, Wyoming, with the agenda expected to include a discussion of printing yet more money to spur growth.
After a recent spate of poor economic numbers, there were jitters the GDP data could show the economy is weaker than originally thought. The government's preliminary reading is expected to come in at 1.4 percent, down from 2.4 percent estimated a month ago. Estimates range broadly from 0.9 percent to 2.2 percent, according to a Reuters poll.
On the technical picture, investors were still looking for the 1,040 level on the S&P to act as support. Some consider a dip below that level to be a buying opportunity, as was seen on Wednesday when the index briefly fell below it.
In deal news, Dell Inc raised its bid for data storage company 3PAR Inc to $1.6 billion, offering slightly more than bigger rival Hewlett-Packard Co.
HP came back with a revised proposal after the closing bell, sending 3PAR's shares up 7.2 percent to $27.90 in extended-hours trading. Shares of 3PAR closed at $26.76. HP closed down 0.1 percent at $38.22, while Dell ended down 0.3 percent to $11.75
A drop in shares of coal companies weighed on the energy sector for a second day as the price of natural gas fell, raising concerns that power plants would switch to gas from coal. Massey Energy fell 4.2 percent to $27.93, while the S&P energy sector fell 1 percent.
(Reporting by Leah Schnurr; Editing by Kenneth Barry)
(For more news visit Reuters India)
Thursday, August 26, 2010
Casino cash may inject $1.5 bln into Singapore annually-DBS
On Thursday 26 August 2010, 16:15 SGT
SINGAPORE, Aug 26 (Reuters) - Revenues from two new casino-resorts could contribute as much as S$2 billion ($1.47 billion) annually to Singapore's economy, which is expected by the government to grow by up to 15 percent this year, DBS Bank said on Thursday.
The two resorts have already contributed S$470 million or 0.3 percentage points to gross domestic product (GDP), which grew 17.9 percent in the first half of 2010 from a year earlier, DBS economist Irvin Seah wrote in a report.
"If the GDP contributions by the integrated resorts continue to rise at the same pace going forward, we can expect full-year GDP contributions of about S$2 billion from these projects," Seah said in the note.
That would translate into adding 0.7 percentage points to GDP for the whole of 2010, he said.
Singapore is counting on the two resorts opened earlier this year by Malaysia's Genting Bhd and Las Vegas Sands to help fuel tourism and economic growth. It hopes to double visitor arrivals to 17 million by 2015.
In July alone, at least 1 million people visited Singapore, the highest number the city-state ever saw in a month, after seven consecutive months of record monthly visitor arrivals.
"However, the contributions derived from the GDP statistics reflect only the direct impact of the IRs. The overall economic gains to the economy are likely to be significantly larger if the spinoffs to other industries are taken into account," he said. ($1=1.358 Singapore dollar) (Reporting by Nopporn Wong-Anan; Editing by Kim Coghill)
SINGAPORE, Aug 26 (Reuters) - Revenues from two new casino-resorts could contribute as much as S$2 billion ($1.47 billion) annually to Singapore's economy, which is expected by the government to grow by up to 15 percent this year, DBS Bank said on Thursday.
The two resorts have already contributed S$470 million or 0.3 percentage points to gross domestic product (GDP), which grew 17.9 percent in the first half of 2010 from a year earlier, DBS economist Irvin Seah wrote in a report.
"If the GDP contributions by the integrated resorts continue to rise at the same pace going forward, we can expect full-year GDP contributions of about S$2 billion from these projects," Seah said in the note.
That would translate into adding 0.7 percentage points to GDP for the whole of 2010, he said.
Singapore is counting on the two resorts opened earlier this year by Malaysia's Genting Bhd and Las Vegas Sands to help fuel tourism and economic growth. It hopes to double visitor arrivals to 17 million by 2015.
In July alone, at least 1 million people visited Singapore, the highest number the city-state ever saw in a month, after seven consecutive months of record monthly visitor arrivals.
"However, the contributions derived from the GDP statistics reflect only the direct impact of the IRs. The overall economic gains to the economy are likely to be significantly larger if the spinoffs to other industries are taken into account," he said. ($1=1.358 Singapore dollar) (Reporting by Nopporn Wong-Anan; Editing by Kim Coghill)
Wednesday, August 25, 2010
QUOTE OF THE WEEK: Value Investing - Money Mind
It's like buying Christmas cards in January, at about half the price of the same cards a month earlier- Warren Buffet. Catch Money Mind this Sunday at 7.30pm to know more.
Tuesday, August 24, 2010
Wednesday Bull Day for Shorts and Gap Down.
Please read this article below. Going to be a very RED day tomorrow. Watch out for Shorts. Very likely GAP DOWN.
---------------------------------
NEW YORK (MarketWatch) -- U.S. stocks fell Tuesday as investors, fretting over recent economic weakness, moved to the safety of the dollar and Treasurys ahead of key housing data.
The Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (DJIA 10,017, -157.42, -1.55%) dropped 92 points, or 0.9%, to 10082, in early trading. All 30 of the measure's components were in the red. Leading the slide, Caterpillar, Inc. /quotes/comstock/13*!cat/quotes/nls/cat (CAT 64.76, -2.08, -3.11%) dropped 2.3%, Walt Disney /quotes/comstock/13*!dis/quotes/nls/dis (DIS 32.25, -0.69, -2.08%) dropped 2% and Cisco Systems Inc. /quotes/comstock/15*!csco/quotes/nls/csco (CSCO 21.35, -0.34, -1.55%) declined 1.9%.
The Nasdaq Composite /quotes/comstock/10y!i:comp (COMP 2,121, -38.29, -1.77%) fell 1.4% to 2129. The Standard & Poor's 500 index /quotes/comstock/21z!i1:in\x (SPX 1,051, -16.76, -1.57%) declined 1.2% to 1055, with all its sectors in the red, led by technology and materials.
AM Report: Fed Split on Move to Bolster EconomyAs the economic recovery showed signs of sputtering, at least seven of 17 Fed officials spoke against or expressed reservations about a plan to alter the way the Fed manages its huge portfolio of securities before the move was approved on Aug. 10. Jon Hilsenrath discusses. Also, Jenny Strasburg discusses a Chinese sovereign-wealth fund in talks to invest a large sum of money in a hedge fund devoted to profiting from 'Black Swan' market swoons.
The broad decline, which puts stocks on track for their fourth-straight day in the red, comes as investors have grown increasingly concerned about the global economy.
Despite strong second-quarter earnings and a recent uptick in merger-and-acquisition activity, economic data have been disappointing. Investors are fearful that if economic numbers continue to come in weak, the economy could be headed toward a double-dip.
"Investors are running away from risk," said John Apruzzese, partner and equity portfolio manager at Evercore Wealth Management. "It's clearly concern about economic growth in the U.S. as well as globally."
Crude-oil futures fell below $72 a barrel and gold futures declined as investors fled to the safety of the dollar and Treasurys. The U.S. Dollar Index /quotes/comstock/11j!i:dxy0 (DXY 83.13, +0.01, +0.01%) , which tracks the U.S. currency against a basket of six others, climbed 0.3%. Gains in Treasurys pushed the yield on the 10-year note /quotes/comstock/31*!ust10y (UST10Y 2.51, -0.09, -3.54%) down to 2.52%. The 10-year note earlier touched 2.509%, its lowest level since March 2009.
The data on tap Tuesday and this week are expected to provide more insight into the health of the economy, with existing-home sales due Tuesday, new-home sales to be released Wednesday and the government's second reading of second-quarter economic growth due Friday. That report is expected to show a significant slowdown in U.S. economic growth, with the estimate for second-quarter gross domestic product predicted to be cut to 1.3% growth from 2.4% growth.
Ahead of those reports, the market is particularly jittery.
"Investors are hyper sensitive to macro economic data because they got burned two years ago and they're afraid of it happening again," Apruzzese said.
---------------------------------
NEW YORK (MarketWatch) -- U.S. stocks fell Tuesday as investors, fretting over recent economic weakness, moved to the safety of the dollar and Treasurys ahead of key housing data.
The Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (DJIA 10,017, -157.42, -1.55%) dropped 92 points, or 0.9%, to 10082, in early trading. All 30 of the measure's components were in the red. Leading the slide, Caterpillar, Inc. /quotes/comstock/13*!cat/quotes/nls/cat (CAT 64.76, -2.08, -3.11%) dropped 2.3%, Walt Disney /quotes/comstock/13*!dis/quotes/nls/dis (DIS 32.25, -0.69, -2.08%) dropped 2% and Cisco Systems Inc. /quotes/comstock/15*!csco/quotes/nls/csco (CSCO 21.35, -0.34, -1.55%) declined 1.9%.
The Nasdaq Composite /quotes/comstock/10y!i:comp (COMP 2,121, -38.29, -1.77%) fell 1.4% to 2129. The Standard & Poor's 500 index /quotes/comstock/21z!i1:in\x (SPX 1,051, -16.76, -1.57%) declined 1.2% to 1055, with all its sectors in the red, led by technology and materials.
AM Report: Fed Split on Move to Bolster EconomyAs the economic recovery showed signs of sputtering, at least seven of 17 Fed officials spoke against or expressed reservations about a plan to alter the way the Fed manages its huge portfolio of securities before the move was approved on Aug. 10. Jon Hilsenrath discusses. Also, Jenny Strasburg discusses a Chinese sovereign-wealth fund in talks to invest a large sum of money in a hedge fund devoted to profiting from 'Black Swan' market swoons.
The broad decline, which puts stocks on track for their fourth-straight day in the red, comes as investors have grown increasingly concerned about the global economy.
Despite strong second-quarter earnings and a recent uptick in merger-and-acquisition activity, economic data have been disappointing. Investors are fearful that if economic numbers continue to come in weak, the economy could be headed toward a double-dip.
"Investors are running away from risk," said John Apruzzese, partner and equity portfolio manager at Evercore Wealth Management. "It's clearly concern about economic growth in the U.S. as well as globally."
Crude-oil futures fell below $72 a barrel and gold futures declined as investors fled to the safety of the dollar and Treasurys. The U.S. Dollar Index /quotes/comstock/11j!i:dxy0 (DXY 83.13, +0.01, +0.01%) , which tracks the U.S. currency against a basket of six others, climbed 0.3%. Gains in Treasurys pushed the yield on the 10-year note /quotes/comstock/31*!ust10y (UST10Y 2.51, -0.09, -3.54%) down to 2.52%. The 10-year note earlier touched 2.509%, its lowest level since March 2009.
The data on tap Tuesday and this week are expected to provide more insight into the health of the economy, with existing-home sales due Tuesday, new-home sales to be released Wednesday and the government's second reading of second-quarter economic growth due Friday. That report is expected to show a significant slowdown in U.S. economic growth, with the estimate for second-quarter gross domestic product predicted to be cut to 1.3% growth from 2.4% growth.
Ahead of those reports, the market is particularly jittery.
"Investors are hyper sensitive to macro economic data because they got burned two years ago and they're afraid of it happening again," Apruzzese said.
Singapore H1 GDP grew 17.9 pct, sees global risks
Reuters - Monday, August 9
SINGAPORE, Aug 8 - Singapore's economy grew 17.9 percent in the first half of 2010, a pace likely to moderate in the second half, Prime Minister Lee Hsien Loong said on Sunday.
There are still risks facing the economies of Europe and the United States and the global financial system is yet to fully recover from the credit crisis, Lee said in a televised speech on the eve of a national day celebrating Singapore's 45th year of independence.
Lee maintained a government forecast for 13-15 percent growth in 2010, which would make Singapore one of the world's fastest growing economies.
The first-half GDP figure showed the economy expanded at a slightly lower pace in the second quarter from an earlier estimate of 19.3 percent released on July 14. [ID:nSGE673073]
The government had earlier estimated the economy grew 18.1 percent in the first half of 2010 from a year earlier.
Lee did not provide the final second quarter growth figure.
"Growth is likely to moderate in the second half," said Lee. "Risks remain in the world economy, especially in Europe and the U.S. The global financial system is not fully mended."
Lee also touched upon the issue of foreign workers, saying while the government will control the flow the country needed immigrants to make up for a shortage of local workers.
We will control the inflow, to ensure that it is not too fast, and not too large," Lee said. "We will only bring in people who can contribute to Singapore, and work harder to integrate them into our society. And we will make clear that citizens come first."
SINGAPORE, Aug 8 - Singapore's economy grew 17.9 percent in the first half of 2010, a pace likely to moderate in the second half, Prime Minister Lee Hsien Loong said on Sunday.
There are still risks facing the economies of Europe and the United States and the global financial system is yet to fully recover from the credit crisis, Lee said in a televised speech on the eve of a national day celebrating Singapore's 45th year of independence.
Lee maintained a government forecast for 13-15 percent growth in 2010, which would make Singapore one of the world's fastest growing economies.
The first-half GDP figure showed the economy expanded at a slightly lower pace in the second quarter from an earlier estimate of 19.3 percent released on July 14. [ID:nSGE673073]
The government had earlier estimated the economy grew 18.1 percent in the first half of 2010 from a year earlier.
Lee did not provide the final second quarter growth figure.
"Growth is likely to moderate in the second half," said Lee. "Risks remain in the world economy, especially in Europe and the U.S. The global financial system is not fully mended."
Lee also touched upon the issue of foreign workers, saying while the government will control the flow the country needed immigrants to make up for a shortage of local workers.
We will control the inflow, to ensure that it is not too fast, and not too large," Lee said. "We will only bring in people who can contribute to Singapore, and work harder to integrate them into our society. And we will make clear that citizens come first."
Singapore Stocks-SingTel lifts index; upside seen at 2950 pts
Reuters - Tuesday, August 24Send IM Story Print
* Index up 0.6 percent, seen in 2900-2950 range near term
* SingTel rose 2 percent by midday
By Charmian Kok
SINGAPORE, Aug 24 - Singapore shares rose 0.61 percent on Tuesday, outperforming regional bourses like Hong Kong, as the benchmark index got a boost from Southeast Asia's largest telcom firm Singapore Telecommunications.
By the midday break the Straits Times Index <.FTSTI> was up 17.91 points at 2,943.90. More than 129.3 million shares had changed hands.
SingTel's shares rose 2 percent to S$3.00 as investors shrugged off previous concerns that a potential weakness in the Australian dollar resulting from Australia's political stalemate will hit its bottom line.
"There could be some bargain hunting going on as investors recover from yesterday's knee-jerk reaction to news of Australia's hung parliament. The actual impact on SingTel's bottomline isn't so great," said Carey Wong, an investment analyst at OCBC Investment Research.
SingTel's Australian subsidiary, SingTel Optus, accounted for about 19 percent of its bottom line for the fiscal year ended March 31, although it made up 64 percent of its revenue.
Shipbuilders like Yangzijiang Shipbuildingand Cosco Corporation outperformed the broader index, as Cosco secured new contracts and Yangzijiang said it would buy a site in China that can be used to expand its yard. [ID:nSGE67N01B]
Shares of Yangzijiang rose as much as 2.6 percent on Tuesday to S$1.55, while Cosco rose 1.9 percent to S$1.58.
"I expect the STI to continue trading in a tight range (of 2,900-2,950) for the next two weeks. The problem is the earnings season has ended and there's no major economic data we expect in the coming week," said Tey Tze Ming, a market strategist at Saxo Capital Markets.
* Index up 0.6 percent, seen in 2900-2950 range near term
* SingTel rose 2 percent by midday
By Charmian Kok
SINGAPORE, Aug 24 - Singapore shares rose 0.61 percent on Tuesday, outperforming regional bourses like Hong Kong, as the benchmark index got a boost from Southeast Asia's largest telcom firm Singapore Telecommunications
By the midday break the Straits Times Index <.FTSTI> was up 17.91 points at 2,943.90. More than 129.3 million shares had changed hands.
SingTel's shares rose 2 percent to S$3.00 as investors shrugged off previous concerns that a potential weakness in the Australian dollar resulting from Australia's political stalemate will hit its bottom line.
"There could be some bargain hunting going on as investors recover from yesterday's knee-jerk reaction to news of Australia's hung parliament. The actual impact on SingTel's bottomline isn't so great," said Carey Wong, an investment analyst at OCBC Investment Research.
SingTel's Australian subsidiary, SingTel Optus, accounted for about 19 percent of its bottom line for the fiscal year ended March 31, although it made up 64 percent of its revenue.
Shipbuilders like Yangzijiang Shipbuilding
Shares of Yangzijiang rose as much as 2.6 percent on Tuesday to S$1.55, while Cosco rose 1.9 percent to S$1.58.
"I expect the STI to continue trading in a tight range (of 2,900-2,950) for the next two weeks. The problem is the earnings season has ended and there's no major economic data we expect in the coming week," said Tey Tze Ming, a market strategist at Saxo Capital Markets.
Genting Malaysia faces down stockholder revolt
Reuters - Wednesday, August 25Send IM Story Print
KUALA LUMPUR, Aug 24 - Genting Malaysiashareholders backed the company's move to acquire the UK casino operations of Genting Singapore in a 340 million pound deal despite a large number of votes against.
Shareholder revolts in Malaysia are rare and 38 percent of the stockholders voting disapproved of the move in the resolution put to Tuesday's extraordinary meeting.
"People wanted assurances over the next three years to come over Genting UK's profitability," said Genting's deputy chairman Mohammed Hanif Omar.
Genting Malaysia stock was down 2.23 percent at 3.07 ringgit at 0914GMT, underperforming a 0.l9 percent rise in the main Kuala Lumpur stock index <.KLSE>.
(Reporting by Fong Min Hun; Writing by David Chance; Editing by Niluksi Koswanage)
KUALA LUMPUR, Aug 24 - Genting Malaysia
Shareholder revolts in Malaysia are rare and 38 percent of the stockholders voting disapproved of the move in the resolution put to Tuesday's extraordinary meeting.
"People wanted assurances over the next three years to come over Genting UK's profitability," said Genting's deputy chairman Mohammed Hanif Omar.
Genting Malaysia stock was down 2.23 percent at 3.07 ringgit at 0914GMT, underperforming a 0.l9 percent rise in the main Kuala Lumpur stock index <.KLSE>.
(Reporting by Fong Min Hun; Writing by David Chance; Editing by Niluksi Koswanage)
Singapore lifts ban on brokers on sale of structured notes
Reuters - 2 hours 27 minutes agoSend IM Story Print
SINGAPORE, Aug 24 - Singapore's central bank lifted a ban on the sale of structured notes for six brokerages on Tuesday after they complied with the regulator's orders.
The ban was imposed last year after a probe into the sale and marketing of the derivatives linked to failed Wall Street bank Lehman Brothers.
The brokerages are CIMB Securities Pte Ltd, DMG & Partners Securities Pte Ltd, Kim Eng Securities Pte Ltd, OCBC Securities Pte Ltd, Phillip Securities Pte Ltd and UOB Kay Hian Pte Ltd, the Monetary Authority of Singapore said in a statement.
The central bank said the six financial institutions have publicly pledged to implement various measures to ensure these products are fairly marketed and sold to retail investors. "These include stepping up training and supervision of their staff and enhancing the policies and procedures on their sales and advisory process, it said.
Thousands of Singapore investors lost money in 2008 after they bought risky derivatives linked to the collapsed U.S. investment bank that had been marketed as relatively safe alternatives to fixed deposits, sparking several protests in the tightly controlled city-state. [ID:nSIN22393]
Under MAS' directions, the financial institutions were required to appoint an external person to review their action plan and report on its implementation.
SINGAPORE, Aug 24 - Singapore's central bank lifted a ban on the sale of structured notes for six brokerages on Tuesday after they complied with the regulator's orders.
The ban was imposed last year after a probe into the sale and marketing of the derivatives linked to failed Wall Street bank Lehman Brothers.
The brokerages are CIMB Securities Pte Ltd, DMG & Partners Securities Pte Ltd, Kim Eng Securities Pte Ltd, OCBC Securities Pte Ltd, Phillip Securities Pte Ltd and UOB Kay Hian Pte Ltd, the Monetary Authority of Singapore said in a statement.
The central bank said the six financial institutions have publicly pledged to implement various measures to ensure these products are fairly marketed and sold to retail investors. "These include stepping up training and supervision of their staff and enhancing the policies and procedures on their sales and advisory process, it said.
Thousands of Singapore investors lost money in 2008 after they bought risky derivatives linked to the collapsed U.S. investment bank that had been marketed as relatively safe alternatives to fixed deposits, sparking several protests in the tightly controlled city-state. [ID:nSIN22393]
Under MAS' directions, the financial institutions were required to appoint an external person to review their action plan and report on its implementation.
OCBC'S STOCK COMMENT: Wilmar International
OCBC'S STOCK COMMENT: Wilmar International expands into the sugar business by acquiring a sugar refinery in Indonesia and a sugar trading company in Singapore. Asia Pac sugar consumption to see 6% growth over the next few years with demand outstripping supply. Still early days before meaningful contributions from its sugar business, we hold off adjusting our estimates. Our S$7.25 fair value and BUY rating maintained.
Catch Money Mind this Sunday (Aug 29)
Catch Money Mind this Sunday (Aug 29) as we go on the trail of some of the world's greatest investors - many of whom owe their success to just one man - Benjamin Graham. But who is he? And what is his magic money-making formula?
European Stocks, U.S. Futures Retreat; Rio Tinto, CRH Fall
Stocks dropped for a fourth day, U.S. futures slipped and commodities fell while the yen strengthened to a 15-year high against the dollar on concern the economic recovery is dissipating. Government bonds rallied.
The Stoxx Europe 600 Index declined 1.3 percent at 10:25 a.m. in London, while Japan’s Nikkei 225 Stock Average entered a bear market. Standard & Poor’s 500 Index futures sank 0.8 percent. The yen appreciated against all of its 16 major peers. German 10-year bonds jumped, widening the yield difference with Irish debt to within nine basis points of its euro-era record. Oil and copper retreated for a fifth day.
Sales of existing U.S. homes probably tumbled in July to the lowest level since March 2009, according to a Bloomberg survey. CRH Plc, the world’s second-largest maker of building materials, forecast lower earnings, citing concern about the U.S. outlook. Slower Asian economic growth will have a “serious negative impact,” Olli Rehn, the European Union’s economic chief, said yesterday in a Bloomberg Television interview.
“Yields down, yen up, risk off,” a team led by Kit Juckes, head of foreign-exchange research at Societe Generale SA in London, wrote today in a report. “Today’s key economic data will come in the form of U.S. existing home sales, and the only straw anyone could snatch at is that no-one has any hope of good news. Equities are vulnerable today.”
CRH, Vedanta, Cairn
The MSCI World Index of stocks in 24 developed nations fell 0.6 percent. Construction and materials companies led declines by all 19 industries on Europe’s Stoxx 600, while more than 16 shares dropped for every one that gained. CRH slumped 15 percent, the biggest intraday drop since 2002. Vedanta Resources Plc tumbled 5.7 percent to a 10-month low. Cairn Energy Plc sank 1.4 percent after its first well off Greenland found natural gas rather than crude oil. WPP Plc, the world’s largest advertising company, lost 3 percent after profit missed estimates.
Rio Tinto Group slipped 2.8 percent after the Globe and Mail reported that the world’s third-largest mining company may be considering a bid for Potash Corp. of Saskatchewan Inc. together with a Chinese partner to rival a $40 billion proposal by BHP Billiton Ltd. Dell Inc. fell 1.1 percent in Germany as a person close to the matter said the company may raise its bid for 3Par Inc. after Hewlett-Packard Co. offered to buy the maker of data-center equipment for about $1.6 billion, 33 percent higher than Dell’s offer.
Bear Markets
The MSCI Asia Pacific Index sank 0.8 percent as Japan’s Nikkei 225 fell to its lowest close since May 1, 2009. The gauge has fallen 21 percent since reaching an 18-month high on April 5, a drop that signifies a bear market to some analysts. Vietnam’s VN Index tumbled 3 percent, taking its drop since May 6 to 21 percent.
The decline in U.S. futures indicated the S&P 500 may drop for a fourth day. Purchases of previously owned U.S. homes plunged 13.4 percent from June to a 4.65 million annual rate, a third decline in a row, according to the median of 74 forecasts in a Bloomberg News survey. The report from the National Association of Realtors is due at 10 a.m. in Washington.
The yield spread between Irish and German 10-year government debt widened two basis points to 307 basis points, near the level set before the European Union and the International Monetary Fund set up a 750 billion euro ($947 billion) fund to protect the single currency on May 8. The Greek-German spread gained five basis points to 867 basis points, and the Portuguese-German spread increased nine basis points to 306 basis points.
Treasuries, Bunds
Treasuries and German government bonds rose, with the yield on 10- and 30-year bunds falling to record lows. U.S. 10-year yields fell five basis points to 2.55 percent, within one basis point of the least since March 2009. German 10-year yields fell four basis points to 2.24 percent, while 30-year yields also dropped four basis points, to 2.87 percent. U.S. two-year note yields were within one basis point of a record low before the sale $37 billion of the securities.
Europe is at risk of going into a so-called “double-dip” recession, as governments cut spending to narrow their fiscal deficits, Nobel Prize-winning economist Joseph Stiglitz said in an interview with Dublin-based RTE Radio today.
The pound fell to its weakest level in almost a month against the dollar after Bank of England policy maker Martin Weale said the U.K. economy may slip back into a recession. The British currency depreciated 0.6 percent to $1.5412 and weakened 0.5 percent to 82 pence per euro.
Yen, Dollar
The yen appreciated 0.8 percent to 84.45 per dollar, the strongest since July 1995. It jumped 1.6 percent against the Korean won. The dollar climbed against all its major peers except the yen, while the euro fell 0.2 percent to its lowest against the U.S. currency since July 13.
Industrial metals declined for a fifth day, led by a 2 percent drop in nickel prices on the London Metal Exchange. Inventories of nickel, copper, lead and zinc all increased in warehouses monitored by the LME, signaling slowing demand for the metals. Oil declined 0.9 percent to $72.43 a barrel in New York as analysts estimated that U.S. inventories of crude rose last week.
Raw-materials stocks led a 1 percent drop in the MSCI Emerging Markets Index, the biggest decline in nine days. The Philippine Stock Exchange Index sank 2.3 percent, the most in 11 weeks, and the peso fell 1 percent against the dollar after at least eight tourists from Hong Kong were killed by gunfire yesterday in a bus siege in Manila.
Hungary’s forint dropped to a three-week low against the euro after the central bank raised its inflation forecast and lowered its growth estimates for the next two years. South Africa’s rand slumped 0.7 percent versus the dollar before a report today that may show economic growth slowed in the second quarter.
To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net
The Stoxx Europe 600 Index declined 1.3 percent at 10:25 a.m. in London, while Japan’s Nikkei 225 Stock Average entered a bear market. Standard & Poor’s 500 Index futures sank 0.8 percent. The yen appreciated against all of its 16 major peers. German 10-year bonds jumped, widening the yield difference with Irish debt to within nine basis points of its euro-era record. Oil and copper retreated for a fifth day.
Sales of existing U.S. homes probably tumbled in July to the lowest level since March 2009, according to a Bloomberg survey. CRH Plc, the world’s second-largest maker of building materials, forecast lower earnings, citing concern about the U.S. outlook. Slower Asian economic growth will have a “serious negative impact,” Olli Rehn, the European Union’s economic chief, said yesterday in a Bloomberg Television interview.
“Yields down, yen up, risk off,” a team led by Kit Juckes, head of foreign-exchange research at Societe Generale SA in London, wrote today in a report. “Today’s key economic data will come in the form of U.S. existing home sales, and the only straw anyone could snatch at is that no-one has any hope of good news. Equities are vulnerable today.”
CRH, Vedanta, Cairn
The MSCI World Index of stocks in 24 developed nations fell 0.6 percent. Construction and materials companies led declines by all 19 industries on Europe’s Stoxx 600, while more than 16 shares dropped for every one that gained. CRH slumped 15 percent, the biggest intraday drop since 2002. Vedanta Resources Plc tumbled 5.7 percent to a 10-month low. Cairn Energy Plc sank 1.4 percent after its first well off Greenland found natural gas rather than crude oil. WPP Plc, the world’s largest advertising company, lost 3 percent after profit missed estimates.
Rio Tinto Group slipped 2.8 percent after the Globe and Mail reported that the world’s third-largest mining company may be considering a bid for Potash Corp. of Saskatchewan Inc. together with a Chinese partner to rival a $40 billion proposal by BHP Billiton Ltd. Dell Inc. fell 1.1 percent in Germany as a person close to the matter said the company may raise its bid for 3Par Inc. after Hewlett-Packard Co. offered to buy the maker of data-center equipment for about $1.6 billion, 33 percent higher than Dell’s offer.
Bear Markets
The MSCI Asia Pacific Index sank 0.8 percent as Japan’s Nikkei 225 fell to its lowest close since May 1, 2009. The gauge has fallen 21 percent since reaching an 18-month high on April 5, a drop that signifies a bear market to some analysts. Vietnam’s VN Index tumbled 3 percent, taking its drop since May 6 to 21 percent.
The decline in U.S. futures indicated the S&P 500 may drop for a fourth day. Purchases of previously owned U.S. homes plunged 13.4 percent from June to a 4.65 million annual rate, a third decline in a row, according to the median of 74 forecasts in a Bloomberg News survey. The report from the National Association of Realtors is due at 10 a.m. in Washington.
The yield spread between Irish and German 10-year government debt widened two basis points to 307 basis points, near the level set before the European Union and the International Monetary Fund set up a 750 billion euro ($947 billion) fund to protect the single currency on May 8. The Greek-German spread gained five basis points to 867 basis points, and the Portuguese-German spread increased nine basis points to 306 basis points.
Treasuries, Bunds
Treasuries and German government bonds rose, with the yield on 10- and 30-year bunds falling to record lows. U.S. 10-year yields fell five basis points to 2.55 percent, within one basis point of the least since March 2009. German 10-year yields fell four basis points to 2.24 percent, while 30-year yields also dropped four basis points, to 2.87 percent. U.S. two-year note yields were within one basis point of a record low before the sale $37 billion of the securities.
Europe is at risk of going into a so-called “double-dip” recession, as governments cut spending to narrow their fiscal deficits, Nobel Prize-winning economist Joseph Stiglitz said in an interview with Dublin-based RTE Radio today.
The pound fell to its weakest level in almost a month against the dollar after Bank of England policy maker Martin Weale said the U.K. economy may slip back into a recession. The British currency depreciated 0.6 percent to $1.5412 and weakened 0.5 percent to 82 pence per euro.
Yen, Dollar
The yen appreciated 0.8 percent to 84.45 per dollar, the strongest since July 1995. It jumped 1.6 percent against the Korean won. The dollar climbed against all its major peers except the yen, while the euro fell 0.2 percent to its lowest against the U.S. currency since July 13.
Industrial metals declined for a fifth day, led by a 2 percent drop in nickel prices on the London Metal Exchange. Inventories of nickel, copper, lead and zinc all increased in warehouses monitored by the LME, signaling slowing demand for the metals. Oil declined 0.9 percent to $72.43 a barrel in New York as analysts estimated that U.S. inventories of crude rose last week.
Raw-materials stocks led a 1 percent drop in the MSCI Emerging Markets Index, the biggest decline in nine days. The Philippine Stock Exchange Index sank 2.3 percent, the most in 11 weeks, and the peso fell 1 percent against the dollar after at least eight tourists from Hong Kong were killed by gunfire yesterday in a bus siege in Manila.
Hungary’s forint dropped to a three-week low against the euro after the central bank raised its inflation forecast and lowered its growth estimates for the next two years. South Africa’s rand slumped 0.7 percent versus the dollar before a report today that may show economic growth slowed in the second quarter.
To contact the reporter on this story: Stephen Kirkland in London at skirkland@bloomberg.net
Asia Slowdown to Have `Serious Negative Impact' on Europe, EU's Rehn Says
By Sara Eisen and Meera Louis - Aug 24, 2010 3:12 PM GMT+0800
Business ExchangeTwitterDeliciousDiggFacebookLinkedInNewsvinePropellerYahoo! BuzzPrint Slower economic growth in China, India or other Asian economies would have a “serious negative impact” on Europe’s growth, the European Union’s economic chief said.
Olli Rehn, the EU commissioner for economic and monetary affairs, said yesterday in a Bloomberg Television interview that a slowdown in the U.S. recovery and turmoil in the sovereign debt markets also could cause concern in Europe.
Strengthening global growth helped Europe’s economy show the fastest expansion in four years in the second quarter after the Greek budget crisis earlier damped confidence in the euro currency and forced governments to step up deficit-cutting measures. Euro-area growth is likely to decelerate in the second half of the year as signs of a slowdown in the U.S. and China dim export prospects.
In the U.S., the world’s biggest economy, the Commerce Department may revise lower its second-quarter growth rate to the slowest since the recovery began, according to the median forecast of economists in a Bloomberg News survey. China’s expansion eased to 10.3 percent in the second quarter and industrial production cooled more than forecast in June, data showed last month, signaling a deeper second-half slowdown.
“Any slowdown in Asia, in the emerging economies of Asia, China, India and others, would have a serious negative impact on economic growth in Europe,” Rehn said in the interview in New York.
Growth Prospects
Asian stocks dropped today and European shares opened lower on concern the global recovery is faltering. The MSCI Asia Pacific Index fell 0.7 percent as of 3 p.m. in Tokyo, and the Dow Jones Stoxx 600 Index declined 1 percent at 8:05 a.m. in London.
John Lipsky, the International Monetary Fund’s first deputy managing director, said on July 27 that the global recovery is likely to be “moderate” as renewed strains in financial markets pose risks to growth prospects.
While economic recovery is “under way” in Europe, Rehn said “it is essential that countries like Greece, Portugal and also Spain address their problems of competitiveness.” Even as gross domestic product in Germany jumped 2.2 percent in the second quarter, Spain’s economy grew just 0.2 percent and Greece, which was forced to seek an EU-led bailout in May, experienced a 1.5 percent contraction.
Greece
The EU said last week that Greece is ahead of schedule in meeting its deficit-cutting commitments under the 110 billion- euro ($139 billion) rescue package, putting the country on track to secure the next loan installment. Greek Prime Minister George Papandreou has cut wages and pensions and increased taxes to qualify for the loans, granted to stave off a default.
Greece’s budget cuts will convince investors that concerns about a debt restructuring are “unfounded,” Rehn wrote in an article published today in the Wall Street Journal.
“We are seeing signs of a gradual stabilization in market sentiment toward Greece,” Rehn wrote. “I am confident that risk perceptions will ease as the adjustment moves forward, which should lay the ground for an eventual orderly return to market access.”
To contact the reporters on this story: Sara Eisen in New York at seisen@bloomberg.net; Meera Louis in Brussels at mlouis1@bloomberg.net.
Business ExchangeTwitterDeliciousDiggFacebookLinkedInNewsvinePropellerYahoo! BuzzPrint Slower economic growth in China, India or other Asian economies would have a “serious negative impact” on Europe’s growth, the European Union’s economic chief said.
Olli Rehn, the EU commissioner for economic and monetary affairs, said yesterday in a Bloomberg Television interview that a slowdown in the U.S. recovery and turmoil in the sovereign debt markets also could cause concern in Europe.
Strengthening global growth helped Europe’s economy show the fastest expansion in four years in the second quarter after the Greek budget crisis earlier damped confidence in the euro currency and forced governments to step up deficit-cutting measures. Euro-area growth is likely to decelerate in the second half of the year as signs of a slowdown in the U.S. and China dim export prospects.
In the U.S., the world’s biggest economy, the Commerce Department may revise lower its second-quarter growth rate to the slowest since the recovery began, according to the median forecast of economists in a Bloomberg News survey. China’s expansion eased to 10.3 percent in the second quarter and industrial production cooled more than forecast in June, data showed last month, signaling a deeper second-half slowdown.
“Any slowdown in Asia, in the emerging economies of Asia, China, India and others, would have a serious negative impact on economic growth in Europe,” Rehn said in the interview in New York.
Growth Prospects
Asian stocks dropped today and European shares opened lower on concern the global recovery is faltering. The MSCI Asia Pacific Index fell 0.7 percent as of 3 p.m. in Tokyo, and the Dow Jones Stoxx 600 Index declined 1 percent at 8:05 a.m. in London.
John Lipsky, the International Monetary Fund’s first deputy managing director, said on July 27 that the global recovery is likely to be “moderate” as renewed strains in financial markets pose risks to growth prospects.
While economic recovery is “under way” in Europe, Rehn said “it is essential that countries like Greece, Portugal and also Spain address their problems of competitiveness.” Even as gross domestic product in Germany jumped 2.2 percent in the second quarter, Spain’s economy grew just 0.2 percent and Greece, which was forced to seek an EU-led bailout in May, experienced a 1.5 percent contraction.
Greece
The EU said last week that Greece is ahead of schedule in meeting its deficit-cutting commitments under the 110 billion- euro ($139 billion) rescue package, putting the country on track to secure the next loan installment. Greek Prime Minister George Papandreou has cut wages and pensions and increased taxes to qualify for the loans, granted to stave off a default.
Greece’s budget cuts will convince investors that concerns about a debt restructuring are “unfounded,” Rehn wrote in an article published today in the Wall Street Journal.
“We are seeing signs of a gradual stabilization in market sentiment toward Greece,” Rehn wrote. “I am confident that risk perceptions will ease as the adjustment moves forward, which should lay the ground for an eventual orderly return to market access.”
To contact the reporters on this story: Sara Eisen in New York at seisen@bloomberg.net; Meera Louis in Brussels at mlouis1@bloomberg.net.
Franklin Templeton says M&A cycle has just begun
Written by Thomson Reuters
Tuesday, 24 August 2010 16:22
Franklin Templeton expects mergers and acquisitions at US companies, especially in the technology sector, to accelerate, as large firms are seeking fast growth, are bulging with cash and valuations are still cheap.
“We are in that early stages of what we see is an M&A cycle,” Grant Bowers, vice president and portfolio manager, who helps manage the US$932 million ($1.3 billion) Franklin US Opportunities fund, told Reuters in an interview.
Tuesday, 24 August 2010 16:22
Franklin Templeton expects mergers and acquisitions at US companies, especially in the technology sector, to accelerate, as large firms are seeking fast growth, are bulging with cash and valuations are still cheap.
“We are in that early stages of what we see is an M&A cycle,” Grant Bowers, vice president and portfolio manager, who helps manage the US$932 million ($1.3 billion) Franklin US Opportunities fund, told Reuters in an interview.
Olam increases offer for NZ farming systems by 27%
Written by Bloomberg
Tuesday, 24 August 2010 10:06
Olam International, a Singapore-based commodity producer, raised its takeover offer 27% after NZ Farming Systems Uruguaysaid the first bid was too low. Shares rose 13%.
Olam increased its bid to 70 New Zealand cents a share from 55 cents, valuing NZ Farming at NZ$171 million ($164.2 million), according to a filing with the New Zealand stock exchange. The new offer beats a 60 cents-a-share bid plan announced last week by Union Agriculture Corp., a Uruguayan landowner.
Tuesday, 24 August 2010 10:06
Olam International, a Singapore-based commodity producer, raised its takeover offer 27% after NZ Farming Systems Uruguaysaid the first bid was too low. Shares rose 13%.
Olam increased its bid to 70 New Zealand cents a share from 55 cents, valuing NZ Farming at NZ$171 million ($164.2 million), according to a filing with the New Zealand stock exchange. The new offer beats a 60 cents-a-share bid plan announced last week by Union Agriculture Corp., a Uruguayan landowner.
Stocks Fluctuate as Economy Concerns Offset Takeover Optimism - Bloomberg
Stocks fluctuated, erasing earlier gains, as speculation the economy may slip into another recession offset investor optimism amid more than $1 trillion in takeovers this year. The yen rose to a seven-week high against the euro.
Traders edgy over economy - The Business Times
Published August 23, 2010
WALL STREET INSIGHT
Traders edgy over economy
Mega mergers fail to inspire as jobs, manufacturing data sway wary market
By ANDREW MARKS
NEW YORK CORRESPONDENT
THE summer doldrums are firmly in place with what feels like half of Wall Street away on vacation but there is no mistaking the nervous tension pervading the stock market's psychology as August draws to a close.
Three straight days of advances early in the week produced hopes for a summer rally that might provide investors with some positive momentum, and a breakthrough of the range-bound trading.
But those hopes sagged in the face of another round of discouraging news on the employment front, and the nascent rally quickly gave way to a sell-off that has traders bracing themselves for a stressful week.
'It's hard to believe that there's going to be much meaningful action this time of year, when so many people are away and market volume is so low, but I've got the feeling from the jumpy way the market reacted to the weekly jobless claims data on Thursday that the market is pushing to the edge of a significant negative move,' said Mike Kennedy a money manager at Case Asset Advisers after last Friday's closing bell.
WALL STREET INSIGHT
Traders edgy over economy
Mega mergers fail to inspire as jobs, manufacturing data sway wary market
By ANDREW MARKS
NEW YORK CORRESPONDENT
THE summer doldrums are firmly in place with what feels like half of Wall Street away on vacation but there is no mistaking the nervous tension pervading the stock market's psychology as August draws to a close.
Three straight days of advances early in the week produced hopes for a summer rally that might provide investors with some positive momentum, and a breakthrough of the range-bound trading.
But those hopes sagged in the face of another round of discouraging news on the employment front, and the nascent rally quickly gave way to a sell-off that has traders bracing themselves for a stressful week.
'It's hard to believe that there's going to be much meaningful action this time of year, when so many people are away and market volume is so low, but I've got the feeling from the jumpy way the market reacted to the weekly jobless claims data on Thursday that the market is pushing to the edge of a significant negative move,' said Mike Kennedy a money manager at Case Asset Advisers after last Friday's closing bell.
Commodities still buoyant - The Business Times
Executive Money
Published August 18, 2010
Commodities still buoyant
Thanks to rising demand and growth in the emerging markets, reports GENEVIEVE CUA
COMMODITY investments hit a record US$300 billion in assets under management in July, but will the party continue?
Barclays Capital, in its August issue of The Commodity Investor, believes that strong medium term demand still underpins the asset class, thanks to growth in the emerging markets.
It says, however, that growing uncertainty over the economic outlook has made the choice of investment strategy 'a much more complicated task' than a few months ago. 'A deterioration in growth prospects is perhaps reducing some of the upside in oil and industrial metal markets. However, there would need to be the prospect of some very large shifts in the economic landscape before we could be persuaded that downside risks to prices are very large in all but a few markets,' it said.
Barclays says big swings in sentiment have obscured a steady improvement in demand for most commodities. 'So far this year, global demand has surprised to the upside across regions for both oil and other commodities, and that process has further to run, in our view.'
Recently Goldman Sachs reiterated its 'overweight' call on commodities, even though it pared its 12-month forecast for the GSCI Enhanced Total Return Index to 19 per cent from 21 per cent. Commodities have suffered yet another bout of volatility, no thanks to renewed concerns over whether a double-dip recession was imminent.
Goldman is expecting prices to be choppy, but it also believes that rising demand in the emerging markets is likely to keep the supply balance tight.
Barclays' paper addresses two top investor concerns - the sustainability of demand and the close correlation between commodities and other risk assets. The latter has intensified debate over whether commodities qualify as an asset class.
Barclays is forecasting an 'all-time high' in global demand this year, in markets ranging from crude oil, aluminium, copper, corn and soybean. 'The strength of emerging market demand was a key factor in the much-quicker-than-expected V-shaped recovery in demand experienced in many commodity markets and suggests that this component of global consumption has now reached critical mass.'
While demand slumped in mature economies throughy 2009, demand in emerging markets 'barely missed a beat through the credit crisis', it said. Non-OECD oil demand was negative for only one quarter in 2009. Chinese copper demand turned negative in 2008 and early 2009, but has since recovered to hit a high last year, and is now running past that high.
Barclays expects the key drivers of commodity demand to be China, India, the Middle East and Brazil.
On commodities' role in a portfolio, Barclays believes it is premature to draw conclusions on permanent changes in asset class behaviour based on the last couple of years. It points out that commodities did provide diversification benefits in the early stages of the credit crisis.
Between Q4 2007when banks began to reveal the scale of their subprime mortgage exposures, and the second half of 2008, commodity returns based on the DJ-UBS index were 33 per cent, compared with the S&P500's minus 15 per cent. Commodities began to cave in the third quarter of 2008 along with other asset classes, as markets began to price in massive dislocations.
'The strong link between commodities and other asset classes is neither surprising nor new,' it said, citing other crises such as the Gulf war and dot com bubble. 'In each of the cases, commodities went through a period where they were strongly linked with trends in other markets, but subsequently reasserted their independence.'
Published August 18, 2010
Commodities still buoyant
Thanks to rising demand and growth in the emerging markets, reports GENEVIEVE CUA
COMMODITY investments hit a record US$300 billion in assets under management in July, but will the party continue?
Barclays Capital, in its August issue of The Commodity Investor, believes that strong medium term demand still underpins the asset class, thanks to growth in the emerging markets.
It says, however, that growing uncertainty over the economic outlook has made the choice of investment strategy 'a much more complicated task' than a few months ago. 'A deterioration in growth prospects is perhaps reducing some of the upside in oil and industrial metal markets. However, there would need to be the prospect of some very large shifts in the economic landscape before we could be persuaded that downside risks to prices are very large in all but a few markets,' it said.
Barclays says big swings in sentiment have obscured a steady improvement in demand for most commodities. 'So far this year, global demand has surprised to the upside across regions for both oil and other commodities, and that process has further to run, in our view.'
Recently Goldman Sachs reiterated its 'overweight' call on commodities, even though it pared its 12-month forecast for the GSCI Enhanced Total Return Index to 19 per cent from 21 per cent. Commodities have suffered yet another bout of volatility, no thanks to renewed concerns over whether a double-dip recession was imminent.
Goldman is expecting prices to be choppy, but it also believes that rising demand in the emerging markets is likely to keep the supply balance tight.
Barclays' paper addresses two top investor concerns - the sustainability of demand and the close correlation between commodities and other risk assets. The latter has intensified debate over whether commodities qualify as an asset class.
Barclays is forecasting an 'all-time high' in global demand this year, in markets ranging from crude oil, aluminium, copper, corn and soybean. 'The strength of emerging market demand was a key factor in the much-quicker-than-expected V-shaped recovery in demand experienced in many commodity markets and suggests that this component of global consumption has now reached critical mass.'
While demand slumped in mature economies throughy 2009, demand in emerging markets 'barely missed a beat through the credit crisis', it said. Non-OECD oil demand was negative for only one quarter in 2009. Chinese copper demand turned negative in 2008 and early 2009, but has since recovered to hit a high last year, and is now running past that high.
Barclays expects the key drivers of commodity demand to be China, India, the Middle East and Brazil.
On commodities' role in a portfolio, Barclays believes it is premature to draw conclusions on permanent changes in asset class behaviour based on the last couple of years. It points out that commodities did provide diversification benefits in the early stages of the credit crisis.
Between Q4 2007when banks began to reveal the scale of their subprime mortgage exposures, and the second half of 2008, commodity returns based on the DJ-UBS index were 33 per cent, compared with the S&P500's minus 15 per cent. Commodities began to cave in the third quarter of 2008 along with other asset classes, as markets began to price in massive dislocations.
'The strong link between commodities and other asset classes is neither surprising nor new,' it said, citing other crises such as the Gulf war and dot com bubble. 'In each of the cases, commodities went through a period where they were strongly linked with trends in other markets, but subsequently reasserted their independence.'
S'poreans ill equipped for retirement, survey shows
Mon, Aug 23, 2010, my paper, By Reico Wong
SINGAPOREANS are not savvy enough when it comes to planning their long-term finances and are, thus, generally unprepared for retirement, a study by HSBC has revealed.
The HSBC Future of Retirement (FoR) survey, which polled 15,000 respondents across 15 markets and about 1,000 Singaporeans aged 30-70, found that a staggering 91 per cent of locals do not have any idea what their retirement income will look like.
HSBC said that this feeling of unpreparedness among Singaporeans was in part due to a tendency to focus more strongly on the short term.
They had limited understanding about their funds for the long haul, as reflected in the 23 per cent who indicated that they are confident about their long-term finances.
This is despite 26 per cent viewing retirement as a strong motivation to save. About 40 per cent of the locals aged 30 to 50 years said they were willing to save between $500 and $800 each month for retirement.
"This shows that Singaporeans are aware of the need for retirement planning but may not have taken action to prepare for it, perhaps because they don't know where to start," said Mr Walter de Oude, chief executive of HSBC Insurance.
He added that Singaporeans should be proactive in seeking the aid of financial advisers, even if they are saving regularly.
"They'll be able to better identify gaps in retirement planning and ensure that they are on track to achieve the retirement lifestyle they want," he said.
On the back of the FoR survey, HSBC will announce the launch of its new retirement plan, SecureIncome, today.
Targeted at individuals aged 40 to 65 years old, the plan is designed to provide a monthly income or lump-sum savings for one's future needs.
Customers are required to save at least $200 per month, and can choose to accumulate their savings over 10 years, or to age 55. One to 1.5 per cent yield is guaranteed per annum.
The policy can be extended on expiry, and customers can either leave the funds with the insurer to earn interest once again, or receive a monthly income for the next 10 years, together with a non-guaranteed monthly dividend.
If they choose the latter, they also have the option of leaving the income payments with the insurer. They will then receive additional non-guaranteed monthly dividends and interest.
Commenting on the new product, Mr de Oude said: "SecureIncome will make retirement planning less daunting, given its simple design and flexibility."
The policy allows for the deferment of premiums for a year, in the event of unemployment.
It also has a terminal-illness benefit that pays the death benefit in advance.
HSBC has, in recent years, increasingly boosted its suite of retirement solutions.
Past products from the group include Growth Manager, an investment- linked plan that facilitates regular investment and asset accumulation; and GoalSaver, which targets those younger and healthier but want slightly higher insurance coverage.
SINGAPOREANS are not savvy enough when it comes to planning their long-term finances and are, thus, generally unprepared for retirement, a study by HSBC has revealed.
The HSBC Future of Retirement (FoR) survey, which polled 15,000 respondents across 15 markets and about 1,000 Singaporeans aged 30-70, found that a staggering 91 per cent of locals do not have any idea what their retirement income will look like.
HSBC said that this feeling of unpreparedness among Singaporeans was in part due to a tendency to focus more strongly on the short term.
They had limited understanding about their funds for the long haul, as reflected in the 23 per cent who indicated that they are confident about their long-term finances.
This is despite 26 per cent viewing retirement as a strong motivation to save. About 40 per cent of the locals aged 30 to 50 years said they were willing to save between $500 and $800 each month for retirement.
"This shows that Singaporeans are aware of the need for retirement planning but may not have taken action to prepare for it, perhaps because they don't know where to start," said Mr Walter de Oude, chief executive of HSBC Insurance.
He added that Singaporeans should be proactive in seeking the aid of financial advisers, even if they are saving regularly.
"They'll be able to better identify gaps in retirement planning and ensure that they are on track to achieve the retirement lifestyle they want," he said.
On the back of the FoR survey, HSBC will announce the launch of its new retirement plan, SecureIncome, today.
Targeted at individuals aged 40 to 65 years old, the plan is designed to provide a monthly income or lump-sum savings for one's future needs.
Customers are required to save at least $200 per month, and can choose to accumulate their savings over 10 years, or to age 55. One to 1.5 per cent yield is guaranteed per annum.
The policy can be extended on expiry, and customers can either leave the funds with the insurer to earn interest once again, or receive a monthly income for the next 10 years, together with a non-guaranteed monthly dividend.
If they choose the latter, they also have the option of leaving the income payments with the insurer. They will then receive additional non-guaranteed monthly dividends and interest.
Commenting on the new product, Mr de Oude said: "SecureIncome will make retirement planning less daunting, given its simple design and flexibility."
The policy allows for the deferment of premiums for a year, in the event of unemployment.
It also has a terminal-illness benefit that pays the death benefit in advance.
HSBC has, in recent years, increasingly boosted its suite of retirement solutions.
Past products from the group include Growth Manager, an investment- linked plan that facilitates regular investment and asset accumulation; and GoalSaver, which targets those younger and healthier but want slightly higher insurance coverage.
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