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March 18, 2013 Sign up Forward Archive   Top Stories    Bottom falls out of U.S. consumer confidence Persistently high U.S. unemployment and scaremongering over budget issues in Washington contributed to a sharp drop in consumer confidence, which fell to its worst reading since 2011 as gauged by a University of Michigan/Thomson Reuters survey. Economists had projected a slight increase, but the index instead plunged from 77.6 in February to 71.8. Nearly a third of those surveyed predicted slowing economic growth, and nearly 4 in 10 said they expected rising unemployment. USA Today (3/15)      High fuel costs drive up U.S. consumer prices    Reuters U.S. consumer prices jumped 0.7% in February, driven by large increases for gasoline. Excluding that volatile factor and food, however, prices were up a modest 0.2%, the Labor Department reported. "With gasoline prices moderating into the first half of March, next month's report should see a correction due to the volatile energy component," said Michael Dolega, an economist at TD Economics. U.S. News & World Report (3/15)      U.S. factory output surges The automotive sector was a leader as U.S. manufacturing output jumped 0.8% in February from January for a 2% gain from a year earlier. The broader industrial-production gauge was up 0.7% month-on-month, with improvement seen across every industry with the exception of primary metals. "Growth has clearly picked up. This is another positive sign" for the broader economy, said Jim O'Sullivan, chief U.S. economist at High Frequency Economics. Los Angeles Times (tiered subscription model)/Money & Co. blog (3/15)      White House report warns of obstacles to economic recovery While noting dangers ahead due to budget sequestration, the White House's annual report on the U.S. economy paints a generally bright picture, beginning with a resurgent housing market. However, "in the weeks and months ahead, sequestration will begin to disrupt basic functions of government on which Americans depend, from education to emergency first-response to airport security," the report said. The Wall Street Journal/Real Time Economics blog (3/15)      Cyprus bailout plan would seize portion of bank deposits    Reuters Negotiators for Cyprus agreed with international lenders to a €10 billion bailout plan that includes a one-time seizure of funds from existing accounts. Cypriots, however, are reacting angrily, and there was a run to withdraw funds when the news emerged. Lawmakers have postponed a special session to vote on the plan and may block it. Financial Times (tiered subscription model) (3/16) , Financial Times (tiered subscription model) (3/16) , Reuters (3/17)      China's leaders speak forcefully about the way forward In his first news conference as China's new premier, Li Keqiang pledged more "walking the walk" on the way to market-oriented reforms, but these and other goals Li laid out were general in nature with few details. Separately Sunday, President Xi Jinping sounded a similarly ambitious note at the closing meeting of National People's Congress. "In face of the mighty trend of the times and earnest expectations of the people for a better life, we cannot have the slightest complacency, or get the slightest slack at work ... to achieve the Chinese dream of great rejuvenation," Xi said. The Wall Street Journal (3/17) , China Daily (Beijing)/Xinhuanet (3/17)      JPMorgan testimony reveals nature of deception in trading losses U.S. congressional hearings on infamous trading losses at JPMorgan attributed to the "London whale" pointed to what appeared to be several layers of deception. Financial Times (tiered subscription model) (3/15)      Big 2013 gains seen for global property After a 6% gain in the flow of cash into the global property market last year, a further rise of 14% is likely this year, predicts Glenn Rufrano, head of global agency Cushman & Wakefield. That should take the market past the US$1 trillion mark and closer to the US$1.25 trillion invested before the 2008 crash. In particular, "demand for commercial real estate has been generally robust in Asia, where markets have been driven by the wealthy getting wealthier and a desire to find safe havens due to volatility in the equity and residential markets," said James Parry, managing director of capital transactions in Australia for Knight Frank. The Sydney Morning Herald (Australia) (3/16)      Download the Kaplan Schweser CFA® Exam Prep App! Get complete Ethics content with more than 500 questions for self-testing; integrated map, calendar, and social functions; and more. FREE download for iPhone/iPad, Android, and Facebook.   Market Activities  INTERNATIONAL MARKETS OVERVIEW An unexpected fall in a gauge of U.S. consumer confidence put a damper on shares in Europe and the U.S. on Friday. The Stoxx Europe 600 fell 0.36% to 297.44, and the S&P 500 edged down 0.16% to 1,560.70. Here is a continuously update list of global stock indexes. The Wall Street Journal (3/18) , Reuters (3/15) , CNNMoney (3/15)      Asian stocks add to weekly advances Japanese stocks led the way in Asia last week as the new government put in place its leadership at the Bank of Japan and investors across the region reacted to favorable economic news from the U.S. On Friday, the Nikkei added 1.45% to 12,560.95, the Hang Seng eased 0.38% to 22,533.11, the Kospi lost 0.78% to 1,986.50 and the S&P/ASX rose 1.75% to 5,120.20. Bloomberg (3/15)        Economic Trends & Outlook  Japanese government again ups assessment of economy    Reuters Citing particular strength in the automotive sector, the Japanese government ratcheted up for the third month in a row its economic outlook for the nation. The report did note, however, that exports are edging down due to weak global demand but said domestic household spending is holding steady. Yomiuri Shimbun (Japan)/Jiji Press (3/16)      Analyst sees durable promise for M&A activity in India Citing a number of enduring and favorable factors, an Ernst & Young analyst says India remains prime ground for merger and acquisition activity. "Look historically, what India has achieved. ... If you compare other countries, many don't have the population, stability that India has been trying to produce in the last 10 years," said E&Y Global Vice Chair Phillipa McCrostie. The Economic Times (India)/Press Trust of India (3/17)      Australia feels impact of high dollar, lower export prices A strong Australian dollar coupled with a slump in the prices of key commodities that Australia exports to the world are putting a strain on government revenues to such a degree that it is now one of the country's main economic challenges, Treasurer Wayne Swan said. As one possible remedy, Swan said Australia would pursue international measures to eliminate "profit shifting," in which multinational companies ascribe profits to lightly taxed venues worldwide. The Wall Street Journal (3/17)      Philippines seen at lower risk from hot money While acknowledging the current threat of hot money rushing into developing markets that can just as quickly flush out, the International Monetary Fund says the danger in the Philippines remains low. "Emerging Asia faces these same risks, including the Philippines. Our basic assessment, though, is that the risks here, so far, are low compared to those in other countries," said Anoop Singh, the IMF's Asia-Pacific director. Business World (Philippines) (3/17)        Capital Markets & Financial Products  Japan makes case for bargain in equity market Even after a 46% rally since mid-November, Japan's broad Topix gauge of equity is trading at 1.2 times book value, well below 2.3 times book for the S&P 500 in the U.S. Japan's economy minister, Akira Amari, made the case for good bargains in Japanese stocks in a TV interview. "Given the potential of Japanese companies, the valuation of the Japanese market is too low compared with markets in countries like the U.S.," Amari said. Bloomberg (3/17)      Nonbank entities to be eligible for custody-services license Chinese nonbank financial intermediaries whose net assets top 2 billion yuan for three years running may apply beginning in June for licenses to offer custody services for securities investment funds. The China Securities Regulatory Commission will also require that applicants have an independent fund custody department, good security monitoring and a business operating system. China Daily (Beijing)/Xinhuanet (3/16)      Ping An plans bond issue    Reuters Ping An Insurance (Group) Co. of China is awaiting regulatory clearance for a 26 billion yuan issue of convertible bonds. Proceeds are earmarked for general development with a focus on banking. China Daily (Beijing) (3/16)      Investors wary as yen wavers after recent plunge Signs of a stabilizing yen after its recent sharp fall against the U.S. dollar are causing some currency traders to hedge their bets against a further drop. Although Prime Minister Shinzo Abe's preferred candidate for the Bank of Japan is now in place, investors said they now need to see concrete moves toward growth stimulus before the currently consolidating yen resumes its downward path. The Wall Street Journal (3/15)        Industry & Regulatory Update  India investigates allegations of money laundering at 3 banks    Retuers Possible money laundering at India's three largest private-sector banks is the focus of a central bank investigation after allegations by an online magazine. One of the banks, HDFC, on Saturday launched its own internal investigation. The Hindu (India) (3/16) , Financial Times (tiered subscription model) (3/15)      Xiao Gang is reported to be new chief of CSRC Xiao Gang has been named to head the China Securities Regulatory Commission, according to a source. Xiao resigned Sunday as Bank of China's chairman. Bloomberg (3/17)      Learn more about CFA -> About CFA Institute  |  Advertise  |  Educational Resources  |  Social Media     Subscriber Tools     Print friendly format  | Web version  | Search past news  | Archive  | Privacy policy   Read more at SmartBrief.com Industry Home Readers' Choice Search Archive Download a SmartBrief Mobile app today       Recent CFA Institute Financial NewsBrief: Asia Pacific Edition Issues: Friday, March 15, 2013 Thursday, March 14, 2013 Wednesday, March 13, 2013 Tuesday, March 12, 2013 Monday, March 11, 2013     Lead Editor:   Jim Berard       Mailing Address: SmartBrief, Inc.®, 555 11th ST NW, Suite 600, Washington, DC 20004     © 1999-2013 SmartBrief, Inc.®  Legal Information