Americas markets wrap: Cemex drags down Mexican stocks
Latin American currencies extended their rally today as some positive data in the US pointed to a growing economy, but Mexican stocks were weighed down as blue-chip Cemex cut its earnings forecast.
While mixed jobs, retail and service sector growth figures in the US took some focus off eurozone debt, investors are still wary about buying risky assets, analysts said.
Bike-powered mobile phones target emerging markets
Nokia continues its push for market share in developing economies with new specifically targeted features. The first is a pedal-powered battery charger, the FT’s Andrew Ward reports:
Cyclists will be able to plug their handsets into a charger mounted on their handlebars and connected to a dynamo that harnesses electricity from the wheels.
The product could prove popular among the environmentally conscious as a carbon neutral way to charge a mobile phone, but its main appeal is likely to be in developing countries, where access to electricity is limited.
Obama says Peru is ‘an extraordinary economic success story’
Alan García rode a wave of good news all the way to Washington this week for his first official meeting with US president Barack Obama.
Peru’s president is once again presiding over one of the fastest growing economies in Latin America, with the central bank forecasting GDP growth of 6.2 per cent this year. Strong foreign investment flows, demand for mineral and energy resources, and a construction boom have hastened Peru’s recovery from its deepest contraction in eight years, and the national statistics agency announced a 1.4 percentage point drop in poverty.
CEE market wrap-up: Hungary down on negative comments
Central and eastern European markets followed the upward lead of core European markets today, as positive economic data from the US boosted global sentiment. Currencies were mainly flat against the euro, with the exception of the Hungarian forint, which took a dive after the vice president of the ruling Fidesz party, Lajos Kosa, was quoted saying Hungary had a “slim chance to avoid the Greek situation.” European Commission President Jose Manuel Barroso reinforced this assertion, helping to bring jitters to the markets, saying Hungary was in a “very delicate situation.”
A resignation in Pakistan’s finance establishment, Act II
The resignation of Pakistan’s central bank governor, Syed Salim Raza, on Thursday was played down by a finance ministry official in Islamabad. “The stock market’s KSE-100 index rose by more than 1 per cent just today so obviously investors are unmoved” he said, referring to equity prices on the Karachi stock exchange, the main stock market.
There is much to suggest that he simply got it wrong. Raza became the second senior figure in Pakistan’s finance establishment who stepped down after the resignation of former finance minister Shaukat Tarin in February this year. Both men cited ‘personal reasons’ for their departure.
Inflation falls in Turkey – but for how long?
Turkey’s monetary policy committee will breathe a sigh of relief at today’s data showing lower food prices brought inflation back into single digits last month.
Consumer price inflation fell to a year on year rate of 9.1 per cent in May, lower than analysts expectations and down from 10.2 per cent in April. Easing price pressures were largely due to falling food costs, as spring fruit and vegetables came to market and the government eased import quotas to bring down sky-high prices for red meat.
South Africa and India look to build on their roaring trade in stories
South Africa’s president Jacob Zuma made it clear on Thursday that his decision to visit India – and not China – in his first official trip to Asia was primarily inspired by a sentiment of brotherhood towards an old ally in the struggle against imperialist oppression rather than business interests.
The populist South African leader and India’s commerce minister Anand Sharma – who took part in a business forum between the two emerging market countries – traded more old memories about their relevant political struggles than serious plans on how to boost investment.
Higher wages in China: good news for the economy
Chinese wage inflation has become something of a hot topic after Honda and Foxconn both decided to increase worker salaries this week – in Foxconn’s case by as much as 30 per cent. And now the Chinese union of KFC workers is also demanding more cash.
So will rising wages nudge China’s crown as factory of the world? And is it a boon for its neighbours?
Put it to the vote: Latin America set to take on Asia … and win
This house believes that Latin America is going to outperform all other emerging markets over the next 10 years, including Asia.
Huh?
It seems like a crazy suggestion: Brazil may be hot, and Mexico slowly warming up, but how on earth can the likes of Argentina or Venezuela compare to India or South Korea? And yet, judging by a show of hands at an investors’ conference in London this week, the notion may have something to it.
Wage increases likely to become the norm, says MSI CEO
Is a 30 per cent wage increase a lot? For most people in the workforce, the answer would be an unequivocal ‘yes’. For large, hi-tech manufacturing companies, however, the answer is very different indeed, according to Joseph Hsu, chairman and chief executive of Taiwan’s Micro-Star International, or MSI.
Hsu, who heads one of the fastest growing netbook and PC companies, told the Financial Times that the average wage component in a notebook or a desktop PC was only between 3 to 5 per cent. “So even if you raise wages by 20 or 30 per cent, the increase to your total cost is less than 1 per cent . . . it’s not so big a portion,” he said.
New York headlines
*Reports of more Chinese wage pressure
*Poll setback for South Korea ruling party
*China HSBC PMI falls in May
*Gerdau buys out Ameristeel stock in $1.7bn deal
*Pakistan central bank head quits amid economic strain
*TNK-BP unit seeks bankruptcy as gas field sale fails
*Ferrous pulls out of London flotation
*Dubai house prices drop 20 per cent, says Credit Suisse
*Ambani considers Reliance Comms stake sale to fund 3G plans
*Petrobras names six banks to manage share sale
*Hinduja group plans $30bn India play
*Indonesia may keep interest rates at record low
*Russia rises in direct investment ranking
*Markets higher
Asia markets wrap: stocks boosted by US data
Positive US home sales figures and reports of consumer demand recovery in the world’s biggest economy helped to countervail eurozone concerns, boosting sentiment in the region. Asian credit was tighter but capital flows were light ahead of tomorrow’s US payroll figures. Central banks in Indonesia and the Philippines announced they would maintain status quo interest rates, adding to the regional governments caution on global recovery. Yesterday the Bank of Thailand announced its decision to keep interest rates unchanged. Property shares helped to drag China’s Shanghai composite down 1.6 per cent, making it the only index in the region to trade in the red.
Coke chief executive has new reason to raise a glass in China
Western business groups can ill afford to bear grudges with the Chinese, so magnetic is the prospect of the country’s 1.3bn potential customer base.
But it’s still intriguing to see that Muhtar Kent, chief executive of Coca-Cola, has been elected as chairman of the US-China Business Council, a leading advocacy group.
Smooth ride for Indonesia’s central bank nominee?
Members of Indonesia’s House of Representatives have certainly been a surly bunch. They spent more than three months investigating the government’s controversial bail-out of ailing state lender, PT Bank Century, back in 2008, before voting that it was “illegal” in March.
The members then set their sights on the country’s internationally respected finance minister, Sri Mulyani Indrawati, who approved the bail-out. Like sniping jackals, the veteran lawmakers hounded her so relentlessly – there were personal attacks in the media and boycotts of sessions to discuss budget issues – that Mulyani had enough and bolted to the World Bank, where she is now a managing director.
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