Americas markets wrap: Risk aversion weighs on Brazilian stocks, Mexican peso
A wave of risk aversion weighed on Latin American markets today as investors worried about the state of the global economy. Disappointing data from the US on Thursday continued to fuel fears of a double-dip recession in one of Latin America’s largest trading partners.
“Risk appetite remains in flux”, cautioned currency strategists at Brown Brothers Harriman. Continue reading »
Sound and fury but no intervention in Colombia’s peso rally
Not much surprise in today’s news that Colombia’s central bank is keeping interest rates at a record-low 3 per cent. Economists and the market had widely expected no change.
But the bank did not announce measures to curb the peso’s sharp rise – something markets had expected today. After President Juan Manuel Santos’s speech last week calling on policy makers to be “more creative, more bold” in dealing with the appreciation, many analysts said the bank was likely to resume its daily US dollar purchases, which expired in June. Continue reading »
Good news on Mexican growth, but can it last?
By Ronald Buchanan in Mexico City
Felipe Calderón, the Mexican president, tweeted early today that he was hoping for “good news” later in the day from Inegi, the national statistics office. And so it came to pass, in the shape of a 7.6 per cent year-on-year increase in GDP.
That was good indeed – the most since 1998. Not quite good enough, perhaps, to open the champagne, though one might venture a modest glass of tequila. Continue reading »
Stocks and currencies in Europe’s emerging markets fell on Friday as investors remained nervous. A member of the European Central Bank’s governing council suggested its monetary policy would remain loose, a signal that the region’s economy is recovering more slowly than expected. Continue reading »
McPanda bonds still just a McGesture
When the World Bank sold its first Rmb-denominated bonds in China in 2005 most people thought it was a largely symbolic gesture and that it would be many years before so-called “Panda bonds” would catch on.
They were right. And McDonald’s Rmb bond issue today doesn’t change that. Continue reading »
Deal of the day: India’s highways
By Thomas Williams of mergermarket
India’s education may be bad, but its infrastructure might be worse. “Our roads, ports and airports are not of world standards,” prime minister Manmohan Singh lamented this week, adding that the “resources required to create good physical infrastructure are difficult for the government alone to mobilise.”
Singh’s government has already shown its commitment, by opening infrastructure to foreign investment. Now two US private equity firms – Norwest Venture Partners and The Xander Group – have bet on the potential, paying Rs4bn ($86m) for a 22.2 per cent stake in highway developer Sadbhav Infrastructure Project (SIPL). Continue reading »
Chinese consumers: no longer doormats
China has long been a bit of a sucker’s market for foreign brands: the simple fact of foreignness was enough to sell a consumer good.
Domestic brands found it hard to compete with the conventional wisdom that, in the words of a Chinese proverb, “foreign monks give better sermons”: overseas goods are almost always assumed to have the edge on quality. Continue reading »
[Hey Bric Spender] Scrambling for eggs
When the market chatter is about rising commodity prices and threats to food security, wheat and barley tend to be the nexus of worries. But should we be thinking about eggs too?
Yes, says Oleg Bakhmatyuk, a Ukrainian egg baron, who predicts that rising egg consumption in China and India is set to reshape global supply networks and endanger scrambling and omelette-making in the Middle East and Africa. Continue reading »
Dubai heads out to woo Asian investors
Dubai is back on the road, armed with a clutch of fancy power-point presentations. But the government can’t conceal the cap in its hand.
The department of finance said today it would run a roadshow for fixed-income investors in Asia from August 26 in Hong Kong. The event is supposedly “non-deal”, meaning there is no bond issuance in the offing, but that is hard to believe. Continue reading »
Investors took gains in China and India, in response to the shaky US economy, but other emerging Asian markets rose amid continued domestic bullishness.
The Shanghai Composite closed down 1.7 per cent at 2,642.31, although it remains 1.4 per cent up for the week. “After yesterday when we broke such a high level, the immediate reaction of investors was to sell off,” Guo Yanling of Shanghai Securities told Reuters. Continue reading »
New York headlines
* Sinochem pays ‘close attention’ to PotashCorp
* Dana targeted for hostile bid
* China issues plans to make foreign investment easier
* Thai PM sees 2010 GDP growth exceeding 7 pct
* Panasonic to lift China plasma plant capacity: report Continue reading »
Did the RMB just go global?
The numbers may be small, but the renminbi is quietly taking more bold steps in its gradual journey towards internationalisation – in bonds, forex trading, and in trade loans.
China Knowledge reports:
Industrial and Commercial Bank of China on Aug. 13 announced that it had signed RMB 2 billion worth of memorandum of understanding with Huawei Technologies Co Ltd and the latter firm’s Indonesian client for financing issues.
As one part of the MOU, the Indonesian firm will obtain a RMB 50 million-credit line from ICBC to purchase an online charging system, an intelligent charging platform produced by Huawei. Continue reading »
Further reading: More Rmb under the mattress, Indian CDS and Mexican CSR
From the FT,
Elsewhere,
London headlines
* Dana targeted for hostile bid
* China issues plans to make foreign investment easier
* Thai PM sees 2010 GDP growth exceeding 7 pct
* Panasonic to lift China plasma plant capacity: report
* Essar Energy eyes overseas acquisitions Continue reading »
[Hey Bric Spender] Asia’s middle class: growing but fragile
For many businesses, Asia’s middle class represents the future. But today the Asian Development Bank quietly called for a reality check.
In a generally upbeat statement released on Thursday, the ADB warned that many members of Asia’s emergent middle class are still in a relatively precarious economic position – potentially just one economic shock away from sliding back into poverty – and need further support to strengthen their economic position. Continue reading »
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