Gains in commodities and a moderating inflation outlook boosted Brazilian shares and the real, as an upbeat tone in the US following positive earnings reports lifted markets across the Americas, writes Telis Demos in New York. Continue reading »
OECD on South Africa: mission far from accomplished
South African elites like to see their country as a potential BRIC, one of those rapidly developing countries whose emergence is changing the shape of the world economy.
And at first glance, the publication this week by the Paris-based Organisation for Economic Co-operation and Development of its first ever report on the country reinforces this orthodox view. Continue reading »
Morgan Stanley: buy China, Russia and South Korea
While some others may have their doubts, Morgan Stanley is bullish on world’s emerging economies and bullish on its equities. In a report published this month, Morgan insists that the long-term bull market in emerging market equities is back on track – despite the poor performance of stocks in the US and elsewhere in the developed world.
Jonathan Garner, the chief strategist, is particularly positive on China, dismissing recent concerns about the alleged unsustainability of the country’s recovery from the global. He also likes Russia and South Korea. Continue reading »
CEE markets wrap: Hungarian bonds suffer
Hungary’s glass was part-full, part-empty on Tuesday, after the latest round of IMF fallout included an unsuccessful bond auction, a rally in the forint and a small rise in equities.
The government sold three-month Treasury bills worth 35bn forint ($156m), short of its target of 45bn. The average yield rose from 5.28 per cent to 5.47 per cent. Last week, when the government was still expected to agree a loan with the IMF and EU, Hungary sold 55bn forint of bonds, 5bn more than planned. Continue reading »
Brazil’s Azul aims to hit the big time with small planes
By Andrew Downie in São Paulo
If Twitter’s trending topics measured the popularity of important issues rather than nonsense then aviation would top the list in Brazil, instead of murderous goalkeepers, psychic octopuses and Justin Bieber, whoever he is.
Airports and airport infrastructure have been in the news for all the wrong reasons recently. The man in charge of organizing the 2014 World Cup recently said Brazil’s top priorities are not stadiums or roads or security but “airports, airports, airports”. And yesterday, after years of faffing about, the government promised to invest $5.15 billion reais (around $2.9bn) to ready 13 airports in time for the tournament. Continue reading »
Deal of the day: Chipmaker Atheros buys out private equity in China
By Pamela Barbaglia of mergermarket
In a modest sign that foreign investors can prosper in China, private equity companies have sold Opulan Technologies, a Chinese semiconductor company, for $72m in cash, with additional earnouts possible. The buyer is Nasdaq-based Atheros Communications, which develops semiconductor systems for wired and wireless products. Continue reading »
Private equity in the Gulf: no recovery yet
Until the financial crisis, private equity was one of the Gulf’s trendiest industries. Is it back in fashion yet?
A report published today by the Gulf Venture Capital Association (GVCA) hints so:
Total value of funds raised decreased from $5.4 billion in 2008 to $1.1 billion in 2009 and the number of annual fund closings also decreased from seventeen to only six in each year, respectively. However, a glimmer of a rebound appeared in the first quarter of 2010, as $1 billion was raised from only six funds, suggesting investors’ appetite may be returning to the market. Continue reading »
Guest Post: India’s monsoon bears are watching
By Frederic Neumann of HSBC
Granted, it’s early days yet. But every drop matters in India, and investors are counting. This monsoon season, up to July 14, the rains are short 13 per cent compared to historical norms.
Last year, of course, was much worse: down roughly 26 per cent at this stage. Also, this year, the rains are far better distributed across the country, and the authorities maintain a forecast of slightly above the norm for the total season. We suspect that growth will not take a big hit if the rains fall slightly short, but there could be an additional fiscal burden and ongoing pressure on food prices, which will prevent the WPI from falling rapidly. Continue reading »
Fund inflows boost emerging markets
Investors are rushing back into emerging markets, according to figures released today. EPFR reports that in the week to July 14, emerging market equity funds attracted more than £3bn, and EM bonds funds $745m, taking the bond inflow for 2010 to a record $18.5bn.
These are big numbers. In the same week, inflows into the world’s biggest markets – the US’s – were $1.86bn into equity funds and $2.97bn into bond funds. Flows into Indian and Brazilian equity funds were particularly strong. Continue reading »
For the second day running, Chinese stocks were Asia’s stand-out performers on Tuesday, rebounding from a sixteen-month low earlier this month.
The Shenzhen Composite was up 2.7 per cent at 1,020.36. Among the winners were wind-power equities, on the back of high Chinese energy-use figures and a ‘buy’ rating from Deutsche Bank AG; Xinjiang Goldwind saw a 9.7 per cent rise, its best showing of 2010. The news triggered early rises in metals and other commodities. Continue reading »
New York headlines
* China now world’s biggest energy user
* Indian takeover overhaul could drive up M&A costs
* Hermès creates bespoke brand for China
* Hungary’s ‘foot-in-mouth disease’ threatens investor confidence
* Flybe buys 35 jets worth $1.3bn from Brazil’s Embraer Continue reading »
China still needs its ‘foreign friends’
The heads of General Electric, Siemens and BASF are known in Beijing as “foreign friends” of China.
This hallowed title comes with certain responsibilities, chief among them defending the autocratic Beijing’s government policies’ from its critics abroad. If foreign friends fail in this task or become openly critical of the Chinese leadership they can find themselves accused of being ignorant of China and its unique national conditions or, even worse, of “hurting the feelings of 1.3bn people”.
So how will China react to Jeffrey Immelt, Peter Loescher and Juergen Hambrecht – chief executives of GE, Siemens and BASF – after their recent attacks on the difficulties of doing business in China? What have they risked by speaking out? Continue reading »
Hungary: panic over but risks remain
Hungary’s markets steadied themselves today after Monday’s turmoil when the forint and equities were hit by the collapse of talks between the government and an International Monetary Fund/European Union team.
Offficials in Budapest and elsewhere in central and eastern Europe will breathe a sigh of relief. But, as Thomas Mirow, the president of the European Bank for Reconstruction and Development, points out today, the region is by no means out of the Hungarian woods. Continue reading »
From the FT,
From elsewhere,
Taiwan’s stock exchange chief eyes Chinese companies
Stock exchanges weren’t among the 700-odd items on the ‘early harvest list’ of sectors likely to benefit from the broad trade deal Taiwan recently signed with China, but that hasn’t stopped Taiwan’s bourse from believing it would be a major indirect beneficiary of closer and more open cross-Strait economic links.
Schive Chi, chairman of the Taiwan stock exchange, said Tuesday that a number of ‘red chips’ – Hong Kong-listed mainland Chinese companies that are not listed in China – have expressed interested in listing Taiwan Depository Receipts, and that the first application to do so could come as early as next month. Continue reading »
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