Daily Archives: Sep 29, 2010

Brazilian real against US dollarRenewed European sovereign debt worries weighed on Latin American market. Stocks and Mexico’s peso fell, but Brazil’s real continued to gain against the dollar. Read more

Investors have plenty of reasons to shy away from Argentina: many exports are heavily taxed; there are seasonal gas shortages; and the rules of the game have a nasty habit of changing.

But Argentina has seen an increased number of mergers and acquisitions in the first half of the year. And what’s especially interesting is who’s doing the buying: not the traditional US or European companies, but increasingly the Brics. Read more

Turkey’s family conglomerates have always been skilled at reinventing themselves. Many had origins in textiles or construction, but shifted capital into construction, banking or automotives to keep up with fashions and opportunities.

Today the big opportunities are in infrastructure – and Turkish construction groups are rapidly recasting themselves as concessions groups to take advantage of a slew of roads, ports and energy privatisations at home and in the surrounding region. Read more

Russian and Polish stocks rose on Wednesday, but other central and eastern European indices saw small losses. Currencies continued to rise against the dollar, with the Turkish lira gaining 1.3 per cent in response to news that the central bank may cut its lending rate.

In Russia, analysts said that the sacking of the mayor of Moscow, Yuri Luzhkov, could shake up the real estate sector. The former mayor’s wife, widely seen as Russia’s richest woman, is active in the sector. Read more

One positive outcome of Russia’s devastating 2008- 2009 economic meltdown has been the development of a local bond market, which, following a decline in inflation and interest rates, has given Russian corporates an affordable alternative to borrowing from international banks.

Prior to the crisis, the only sources of long term credit were foreign banks, unless one was prepared to pay interest rates of 20 per cent plus. The result was a massive build up of foreign corporate debt, which had to be unwound after markets collapsed. Long moribund after the 1998 crash, a roubles bond market has now taken off again, and the terms are becoming more and more attractive to Russian companies. Read more

By Timothy Ash, head of emerging markets research, Royal Bank of Scotland

Most investors in emerging markets had a pretty good end to 2009, thanks to quantitative easing policies adopted by developed countries. The party spilled into 2010 – and, although the need for a mega clean-up operation (fiscal austerity) became clear, the Fed has come along with a reworked version of quantitative easingRead more

Billionaires behind bars are still a rarity, but China’s Huang Guangyu is the best example since Russian oligarch Mikhail Khodorkovsky. Unlike Khodorkovsky, Huang was not his country’s richest man when he was put in jail back in May. But he is still a redoubtable figure. A recent internet poll found that most Chinese people thought that he would prevail in a battle for control of Gome, China’s second-largest retailer, which he founded.

A new Hurun Report, China’s rich list, published on Wednesday ranks him as the China’s 21st richest person, with net wealth of $3.5bn; that’s down just four places from last year. Moreover, as a Lex note explains, Huang has managed to block some – if not all – of Gome’s management’s attempts to sideline him. Next move? Lex says Gome’s chairman may now have to go.

Watching a recent Bollywood remake of the Hollywood Stepmom original, one might be forgiven for wondering why plastic tubs seem to feature as much as the celebrities who star in it. The reason for pervasive product placement in the film has to do with a new concept in India’s advertising world that is gaining traction: 360-degree marketing.

Not only are advertisers now visible on the big screen, they are benefiting from their own film release-associated adverts. Welcome to the new India where more competition for consumers means advertisements are featuring more prominently in the daily lives of Indians. Read more

Asian stock markets were mixed on Wednesday, in spite of new data showing that Chinese manufacturing grew quicker than expected in September. The MSCI Asia ex Japan index slipped from a two-year high, and India’s Sensex fell below the 20,000 level.

Ahead of a vote by the US House of Representatives on China’s currency policy, the renminbi rose to its highest level against the dollar since 1993. Other currencies also strengthened, with the Indian rupee now having its best month since May 2009. Read more

Ousmène Mandeng, Head of Public Sector Investment Advisory at Ashmore Investment Management

The on-going spat between the US and China over the value of the renminbi, together with the recent foreign exchange market intervention by the Bank of Japan, serve as a reminder that the dollar is bound for further weakness. Read more

* Russian prosecutors to probe Moscow corruption

* Indian court orders close of Vedanta smelter

* US House set to approve China currency bill

* North Korea’s ‘first’ family readies for succession

* India begins most complex ID effort ever

* Chinese cinema chains ready to cash in on movie boom Read more

Another day and another data bit suggesting that China is managing its exit from the global crisis without either soaring into the economic stratosphere or crashing down to earth.

HSBC’s China purchasing managers’ index rose this month (September) for the fifth month in a row, pointing, as the bank says, “to a moderate improvement in Chinese manufacturing sector operating conditions”.  With so much doubt circulating around the global economy, the outlookfor China cannot be certain but looks more stable than a few months ago. Read more

Soon after China’s recent move towards internationalising its currency, Malaysia’s central bank bought renminbi-denominated bonds for its reserves . The move prompted speculation that this would set off a domino effect among China’s trade partners in Asia.

Now that Thailand’s central bank has opened a representative office in China, could Bangkok be next to add  renminbi-denominated bonds to its foreign reserve mix? Read more

From the FT,

From elsewhere,

New Delhi sparked a flurry of enthusiasm among foreign retail giants in July, when the country’s Department of Industrial Policy and Promotion released a “discussion paper” arguing that India would reap a wide range of benefits if it dared to open the tightly regulated retail business to foreign direct investment.

That idea – that foreign retail giants like Tesco, Carrefour, and Walmart – should be set up shop, or lots of shops, in India has been a near total taboo in a country where petty shop-keepers and traders constitute a vast, powerful political constituency. Read more

Considering coffee’s historic role in their country’s development, it’s not too surprising that Brazilians have developed a potent appetite for the drink.

Now, economic growth, changing tastes and the expansion of the middle classes mean that Brazil – already the world’s largest producer of coffee – is expected to soon overtake the US to become the world’s largest consumer. Read more

China’s annual iron ore conference in Dalian is a reminder of how fractious the industry can be. The conference was once the first chance for Chinese steel mills – the world’s largest consumers of iron ore – to begin backroom negotiations on annual contract prices with foreign ore miners.

But that system collapsed in 2008 when Chinese mills walked away from their annual contracts. In their place came quarterly contracts, but the system is still nascent and mixed views on its sustainability were on full display in Dalian. Any change to the system would be felt by the global steel industry. Read more

* UK brand to sweeten Bright Food image

* North Korea’s ‘first’ family readies for succession

* Chinese cinema chains ready to cash in on movie boom

* Asia’s TV makers jostle to realise 3D vision

* S Africa targets Sasol, Arcelor in bid to break apartheid-era cartels Read more

Automakers are pinning their hopes on China, the world’s biggest car market. But there’s a growing hurdle: China’s own-brand cars.

Of every ten vehicles sold in China, only four currently bear a Chinese logo. But the number will rise to five or six by 2015, says the head of the Guangzhou Automobile, the Chinese joint venture partner of Honda and Toyota. And his company is now preparing to launch its first own-brand car, the Trumpchi. Read more