Japan posts widest October trade deficit in more than 30 years | U.S. manufacturing, jobs, confidence all pointing up | Nouriel Roubini projects a gloomy 2013
Web Version
November 22, 2012
CFA Institute: Financial NewsBrief - Aisa Pacific Edition

Top Stories
Greece's creditors fail to reach deal on cutting debt
The eurozone crisis flared back to life as creditors led by Germany and the International Monetary Fund failed to reach agreement on a crucial plan for reducing Greek debt. In Greece, meanwhile, politicians fumed over the unexpected impasse after the country had painfully met the conditions demanded by creditors. The anti-bailout opposition said the pro-bailout government had been "humiliated." Bloomberg (11/21), Financial Times (tiered subscription model) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Japan posts widest October trade deficit in more than 30 years
Hit hard by reduced business with China, Japan's trade deficit last month was the nation's widest for October in more than 30 years. "There's no doubt that Japan's economy is already in a recession; political pressure for further monetary easing is building, and we expect the [Bank of Japan] to take additional measures in January," said Kiichi Murashima, chief economist at Citigroup in Tokyo. However, the central bank's governor criticized recent calls by the leader of Japan's main opposition party for more monetary easing. Nasdaq.com/Dow Jones Newswires (11/21), Bloomberg Businessweek (11/21), The Yomiuri Shimbun (Japan)/Jiji Press (Japan) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
U.S. manufacturing, jobs, confidence all pointing up
New U.S. manufacturing, jobs and consumer sentiment data are all on positive tracks. November's preliminary purchasing managers index for manufacturers came in at 52.4, up from 51.0 last month. Meanwhile, initial applications for unemployment benefits declined by 41,000 in the latest week, and the Thomson Reuters/University of Michigan consumer confidence index edged up to a five-year high of 82.7. Business Insider (11/21), Reuters (11/21), Bloomberg (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Nouriel Roubini projects a gloomy 2013
Setting aside the big overhanging worries of the U.S. fiscal cliff and the eurozone crisis, plenty of other fundamental problems are casting a pall over prospects for the global economy in the new year, says economist Nouriel Roubini. Roubini notes recession across Europe, unsustainability of economic expansion in China and other emerging markets, sustained slow growth in the U.S. and generally high price-earnings ratios in stock markets that render them sensitive to external shocks. AdvisorOne (11/20)
Share: LinkedInTwitterFacebookGoogle+Email
Market Activities
European and U.S. stock markets were choppy Wednesday as they digested news over creditors' failure to reach agreement on a Greek bailout but generally finished higher ahead of the U.S. Thanksgiving holiday. Both the Stoxx Europe 600 and the S&P 500 edged up 0.23%, with the Stoxx index ending at 270.11 and the S&P at 1,391.03. Here is a continuously updated list of global stock indexes. The Wall Street Journal (tiered subscription model) (11/22), MarketWatch (11/21), CNNMoney (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Positive numbers out of U.S. help lift Asian shares
Favorable economic indicators out of the U.S. and talk of additional stimulus in China raised shares in many Asian markets Wednesday. The Nikkei climbed 0.87% to 9,222.52 and the Hang Seng surged 1.39% to 21,524.36, while the Kospi lost 0.32% to end at 1,884.04, and the S&P/ASX was down 0.37% at 4,369.50. Bloomberg Businessweek (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Economic Trends & Outlook
FDI in China set to top US$100 billion for year
Although foreign direct investment in China is on the decline, it still should total more than US$100 billion for 2012, the Commerce Ministry says. Over the first 10 months, FDI was down 3.45% from a year earlier. The Business Times (Singapore) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Taiwan export orders climb, might reach yearly record
Taiwan's export orders in October were up 3.2% from a year before, and orders for the year may be on track to exceed last year's record of US$436.1 billion, according to the Ministry of Economic Affairs. Results for the latest month were helped by increased orders from Southeast Asia and the U.S. China Economic News Service (Taiwan) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Taiwan is rated one of the less fearsome "Asian Tigers"
With its export dependence mainly on developed markets, Taiwan's projected GDP growth of 2.9% next year would place it third among the "Four Asian Tigers," which include Hong Kong, Singapore and South Korea, according to Morgan Stanley. Morgan said one weakness for Taiwan is the lack of brand advantage for many of its exported consumer products. China Economic News Service (Taiwan) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Mining seen driving Australian economic expansion next year
New investment, particularly in mining, should continue to lift Australia's economy in the coming year, according to a survey by Westpac Banking and Melbourne Institute. However, "our expectation is that the spending peak will be around year end or early in 2014," said Westpac chief economist Bill Evans. Xinhuanet.com (China) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Malaysia would feel the pain of U.S. going over "fiscal cliff"
Projected growth of 5.2% for Malaysia's economy in 2013 could be lowered to between 3% and 4% if the U.S. fails to address its fiscal crisis, said economist Gundy Cahyadi of OCBC Bank. "It's going to create a huge impact if this were to happen. The 'fiscal cliff' will create a recession in the U.S. where its economy will likely contract by 0.5%, and this may lead to a bigger-than-expected recession in the eurozone," Cahyadi said. Star Publications (Malaysia) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Lasting investment promise seen in Southeast Asia
Sharp growth this year for mutual funds invested across Southeast Asia should continue for investors who can still get in on the ground floor as the region's economies develop, says Matterhorn Investment Management. "There are a very large number of companies that have very good prospects because it is such an early stage and they have so much more growth to go," said Paul Bate, founder of Matterhorn, which is planning a new long-short hedge fund for the region. The Wall Street Journal (tiered subscription model) (11/20)
Share: LinkedInTwitterFacebookGoogle+Email
Capital Markets & Financial Products
China clears 7 more QFIIs this month
So far this month, seven additional foreign investors have been approved as qualified foreign institutional investors as China looks to provide a further lift to its capital markets. In the latest QFII push by the China Securities Regulatory Commission and the State Administration of Foreign Exchange, 199 such investors have been cleared for QFII status, and the volume of their investment comes to US$33.57 billion. China Daily (Beijing) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
South Korea ranks 31st out of 49 for stock market returns
South Korea's stock market performance places it well down the list of 49 ranked markets, in 31st place with a 3.5% return so far this year, according to Morgan Stanley Capital International. Hong Kong is ninth with a 19.7% return, China is 23rd with 9.3%, and just ahead of South Korea is Japan in 30th place with 5%. MK.co.kr (South Korea) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
IPO for PICC attracts big buyers
AIG with a planned US$500 million is among the many major buyers piling in to the initial public offering of People's Insurance Co. of China, which hopes to raise US$3.6 billion in the largest IPO of a Chinese state-owned company since 2010. The offering is also seen as a revival of Hong Kong's IPO market, which had trailed off this year after a long run of major activity. The Wall Street Journal (tiered subscription model) (11/20)
Share: LinkedInTwitterFacebookGoogle+Email
Standard Life again plans Indian venture flotation
With the life insurance market bouncing back after a regulatory overhaul in India, Standard Life is once again planning to list its Indian joint venture. Financial Times (tiered subscription model) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Regulatory Update
Quick EU approval seen for Glencore-Xstrata merger
The Glencore-Xstrata merger will be on the fast track for EU approval with Glencore's agreement to end a large zinc contract with Nyrstar and sell its stake, sources say. Financial Times (tiered subscription model) (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Despite sale of Ping An stake, HSBC still firmly in China
Even with the US$9.2 billion sale of its stake in Ping An Insurance, HSBC will have US$10 billion worth of holdings in Chinese banks, thus retaining a foothold in the country, analysts say. "HSBC isn't taking its eye off of China. They are walking a tight rope, wanting to book profits on Ping An while at the same time not wanting to appear to be less committed to China," said Sandy Mehta, the Hong Kong-based chief executive officer of Value Investment Principals. Bloomberg (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
BlackRock reportedly planning Hong Kong fund platform for 2013
A platform of funds domiciled in Hong Kong is in the cards for BlackRock in the new year, with launch likely in the first half, sources say. BlackRock would be joining the current roster of 150 Hong Kong-domiciled funds, including a QFII product introduced this week by Franklin Templeton. AsianInvestor.net (11/21)
Share: LinkedInTwitterFacebookGoogle+Email
Editor's Note
Thanksgiving holiday in U.S.
Because of the Thanksgiving Day holiday in the U.S., CFA Institute Financial NewsBrief: Asia Pacific Edition will not publish on Friday, Nov. 23. Publication will resume on Monday, Nov. 26.
Share: LinkedInTwitterFacebookGoogle+Email
Subscriber Tools
Please contact one of our specialists for advertising opportunities, editorial inquiries, job placements, or any other questions.
Editor:  Sean McMahon
Contributing Editor:  Jim Berard

Download the SmartBrief App  iTunes / Android
iTunes  Android
Mailing Address:
SmartBrief, Inc.®, 555 11th ST NW, Suite 600, Washington, DC 20004
© 1999-2014 SmartBrief, Inc.®
Privacy policy |  Legal Information