Eurozone manufacturing records another month of decline | Greece announces buyback as part of debt-whittling plan | Indian manufacturing picks up in November
Web Version
 
December 4, 2012
CFA Institute: Financial NewsBrief - Aisa Pacific Edition
SIGN UP|FORWARD|ARCHIVE

Top Stories
U.S. manufacturing index shows surprising weakness
Reuters
U.S. manufacturing hit a more than three-year low last month, falling beneath the break-even 50 mark at 49.5 on the Institute for Supply Management index. Economists cited concern looking ahead to the outcome of U.S. budget talks and the lingering effects of Hurricane Sandy. "Since May, the index has been very close to 50, and I think what we are seeing is that manufacturing has stalled and has yet to recover," said Christopher Low, chief economist at FTN Financial. CBS MoneyWatch/The Associated Press (12/3), Reuters (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
 
Eurozone manufacturing records another month of decline
Manufacturing in the eurozone stayed firmly in negative territory in November while rising a bit to a Markit Economics index reading of 46.2 from 45.4 in October. It was the 16th month of decline. "The ongoing steep pace of manufacturing decline suggests that the region's recession will have deepened in the final quarter of the year, extending into a third successive quarter. The rate of GDP decline is likely to have gathered pace markedly on the surprisingly modest 0.1 percent decline seen in the third quarter," chief economist Chris Williamson said in Markit's report. Bloomberg (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Greece announces buyback as part of debt-whittling plan
Reuters
Greece is holding out an offer totaling €10 billion to buy back bonds, roughly half the amount the nation owes private creditors. The offer is part of an overall plan approved by eurozone finance ministers last week that might ultimately allow Athens to retire €30 billion in debt. Bloomberg (12/3), The Wall Street Journal (tiered subscription model) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
 
Indian manufacturing picks up in November
An influx of new orders is credited for a steep rise in India's manufacturing activity in November, with the HSBC purchasing managers' index rising to 53.7 from 52.9 in October. However, input and output prices both picked up during the month as well, pointing to a higher rate of inflation. Channel NewsAsia/Agence France-Presse (12/3), The Economic Times (India) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Fitch sees dangers ahead for Indian credit rating
Looking ahead to the months before Indian elections in 2014, Fitch Ratings noted the temptation to ease fiscal policy as one danger, along with a slump in GDP, that could lead to a credit downgrade to junk status. Fitch noted India's strengths of a diverse economy and high savings rates but added that "India's track record of delivering on fiscal policy goals is not encouraging." Reuters (12/3), The Hindu (India) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
IMF no longer opposes cross-border capital controls
Yielding to the practice of many emerging-market countries, the International Monetary Fund has conditionally ended its rejection of direct controls over cross-border capital flows. Financial Times (tiered subscription model) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
CFA Institute report examines impact of internalization and dark pool trading on market quality.
Advertisement
 
Market Activities
INTERNATIONAL MARKETS OVERVIEW
Progress on the eurozone front with a bond buyback plan from Greece and signs of an improving Chinese economy lifted stocks Monday in Europe, but U.S. stocks suffered from unexpectedly weak manufacturing data. The Stoxx Europe 600 added 0.13% to 276.13, and the S&P 500 eased back 0.47% to 1,409.46. Here is a continuously updated list of global stock indexes. The Wall Street Journal (tiered subscription model) (12/4), Bloomberg (12/3), CNNMoney (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Asian stocks ebb and flow, with eyes on China, U.S.
Asian stocks groped for direction Monday with conflicting signs of an improving outlook in China and a dimmer outlook for resolution in U.S. budget talks. The Nikkei edged up 0.13% to 9,458.18, the Hang Seng fell 1.19% to 21,767. 85, the Kospi added 0.37% to 1,940.02 and the S&P/ASX was up 0.57% at 4,531.50. Bloomberg Businessweek (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
The Gold Standard: A Fifty-Year History of the CFA Charter
An exclusive book offer from CFA Institute
Order yours now
Advertisement
 
Economic Trends & Outlook
Indian FDI surges in September
Registering a high for the year, foreign direct investment in India climbed to US$4.67 billion in September, more than double August's total. For the six months through September, however, FDI was down by a third from a year before. The Economic Times (India)/Press Trust of India (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Asia manufacturing looking good, for now
Reuters
With the crucial inclusion of China, manufacturing indicators are generally pointing up across Asia in a positive sign for growth across the region and globally. One external factor that could blow much of the region off course, however, is the U.S. budget situation, with automatic measures due at the beginning of the year posing a threat to the U.S. economy and export demand. The Wall Street Journal (tiered subscription model) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
 
Japan looks to even bigger stimulus after election
Pressure is mounting ahead of this month's elections in Japan for a major package of economic stimuli that would require a supplemental budget. This would be in addition to the latest set of economic measures, which is projected to boost GDP by 0.2%. The Yomiuri Shimbun (Japan) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Taiwan notches 6th month of manufacturing shrinkage
HSBC's purchasing managers' index for Taiwan remained negative in November for the sixth consecutive month. The reading of 47.4 was down from the 47.8 recorded in October, and the sub-index for production dropped even more sharply. The Taipei Times (Taiwan) (12/4)
Share: LinkedInTwitterFacebookGoogle+Email
South Korea to keep closer eye on flows of foreign capital
Reuters
As of April next year, South Korea's financial institutions will be required to provide regulators a breakdown of foreign capital flows by asset classes. The new measures from the Ministry of Strategy and Finance and the Bank of Korea are designed to allow for more careful monitoring of foreign funds entering and exiting the country. MK.co.kr (South Korea) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
 
Property market in China looks healthier as buyers turn up
Worries of a property crash in China are being somewhat relieved by new evidence of eager buyers, belying the widespread notion of vast expanses of empty new construction. Financial Times (tiered subscription model) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Australian rate-cut outlook improves as economy weakens
Earlier expectations that Australia's central bank would lower interest rates have been reinforced by new data pointing to weak retail and job markets and tame inflation. "We continue to expect a 25 basis points cut at the RBA Board meeting tomorrow and for the Bank to maintain a strong easing bias in 2013," said Ivan Colhoun, ANZ's head of Australian economics and property research. The Sydney Morning Herald (Australia)/Reuters (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Capital Markets & Financial Products
CME to set up office in Beijing
Gill/Reuters
CME Group will establish a foothold in Beijing next year, eyeing what it anticipates will be a growing local appetite for derivatives. "The work we've started 10 years ago, we ramped up in the last three to four years, and this has positioned us in a very good way if China does open up," said CME chief Phupinder Gill. The Business Times (Singapore) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
 
Regulatory Update
Layoffs follow harsh year for China's securities companies
With initial public offerings this year at a record low and revenues down nearly 60%, securities companies in China are announcing major layoffs. The belt-tightening includes CITIC Securities, which began reducing staff by 5% to 10% last month. Caijing Magazine online (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Capital erosion widespread among South Korean investment firms
Total capital is now less than paid-in capital for more than 4 in 10 South Korean financial investment companies, according to the Financial Supervisory Service and the Korea Financial Investment Association. Among the prominent companies reporting capital erosion after the past few years of losses are Korea RB Securities, ING Securities and RBS Asia. MK.co.kr (South Korea) (12/3)
Share: LinkedInTwitterFacebookGoogle+Email
Taiwan tax impasse might scuttle renminbi bond flotations
Refusal by Taiwan's Ministry of Finance to grant tax exemptions for offshore banking units of domestic banks floating renminbi-denominated bonds might put a halt to the business. The Financial Supervisory Commission has been encouraging the practice, but without the exemptions, enterprises will be likely instead to issue dim sum bonds in Hong Kong. China Economic News Service (Taiwan) (12/3)
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