Daily Archives: February 16, 2011

China raises hopes, fears in LatAm

February 16, 2011 10:11 pm by Naomi Mapstone
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A freight-carrying ship sails under the Centenario bridge at the Pedro Miguel locks entrance in the Panama CanalFear and loathing about Chinese investors playing in America’s “backyard” stepped up a notch this week with the FT’s scoop on a Chinese proposal to build a railway across Colombia to rival the Panama Canal.

China’s rampant appetite for Latin America’s natural resources contributed to the region’s buoyancy throughout global economic recession and to the relatively new stability in countries such as Peru.

Its desire for coal in particular presents an opportunity to Colombia, which even before this year’s catastrophic floods had targeted infrastructure as a key obstacle to ongoing growth. Continue reading »

Tags: , Posted in Colombia |

Americas markets wrap: Bovespa up on easing inflation, crude prices

February 16, 2011 9:56 pm by Shannon Bond
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Bovespa stock chartLatin American stocks followed global markets higher Wednesday as slower Brazilian economic growth eased inflation fears and crude prices boosted oil companies.

In Brazil, the Bovespa gained 1.9 per cent, the most in two weeks, as financial shares rose. Banco Santander Brasil and Bando do Brasil both added 3.4 per cent, while Redecard, the credit card processor surged 4.8 per cent and rival Cielo advanced 3.1 per cent after Morgan Stanley raised their ratings from underweight to equal weight. Petrobras, the state-controlled oil group, put on 1.3 per cent and OGX added 4.6 per cent as crude prices rose on Middle East tensions. Continue reading »

Posted in Global, LatAm |

Venezuela’s inflation innovations

February 16, 2011 8:56 pm by Benedict Mander
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Venezuelan bolivars and US dollarsMilton Friedman’s famous assertion that “inflation is always and everywhere a monetary phenomenon” carries a lot of weight with most economists these days. Not so in Venezuela, though.

When trying to tackle the country’s dizzying inflation rate – about five times higher than the average in Latin America, a part of the world notorious for its high inflation – the government is nothing if not innovative. Continue reading »

Tags: Posted in Venezuela |

What next for Egyptian business?

February 16, 2011 7:06 pm by Andrew England
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If business people hoped life would return to normal after the upheaval of Egypt’s dramatic revolution, they have had a rude shock.

Sure, the thousands of protesters in Tahrir Square have gone home; shops have reopened and the capital’s traffic is reassuringly chaotic once more. Ignore the tanks and armoured personnel carriers, and the sprawling city of 15m does have an air of normalcy.

Yet a worrying trend has erupted that is threatening attempts to revive an economy paralysed during the 18-day uprising: a wave of unrest by workers who see the dramatic changes in Egypt as an opportunity to improve their lot. Continue reading »

Posted in Egypt |

Heineken: enough bottle in EMs?

February 16, 2011 6:43 pm by Alexandra Stevenson
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Despite a big Mexican deal last year, Dutch-based Heineken remains less of a global company than some of its leading competitors.

As Wednesday’s 2010 numbers revealed, sales from recently-acquired Femsa, the Mexican beer distributor, helped drive a 41 per cent jump in 2010 profits before interest and tax. But sales in western Europe were still a full 47 per cent of the company’s total €16.6bn revenue.

So, in the view of some analysts, Heineken is moving in the right direction, but with less than half its sales in EMs, it still has some way to go. SAB Miller is on 80 per cent. Continue reading »

Tags: , Posted in Global |

CEE markets wrap: equities, currencies gain

February 16, 2011 6:23 pm by Ranjit Lall
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Central and eastern European stocks rose on Wednesday, as oil prices rose and confidence in the strength of the global recovery increased. CEE currencies rose sharply against the dollar, with the Polish zloty leading the rally.

“The CEE equities rally is being driven by global factors,” Neil Shearing, economist at Capital Economics, told beyondbrics. “Russia is benefiting from higher oil prices. Other big markets are riding a wave of improved global risk appetite.” Continue reading »

Posted in Europe, Global |

Russia up; Brazil and Thailand down

February 16, 2011 3:46 pm by Jonathan Wheatley
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Investors love Russia these days while Thailand and Brazil – until recently the darling of many fund managers – are suddenly out of favour.

Those are among the conclusions of Bank of Amercia Merrill Lynch’s latest monthly survey of fund managers, as beyondbrics reported earlier on Wednesday.

What’s going on? Well, BofAML asks thousands of managers what they’re doing, not why. But a few answers suggest themselves.

Continue reading »

Tags: , , , Posted in Global |

Russia’s car market: reflected glory?

February 16, 2011 3:33 pm by John Reed
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Russia has over the last four years offered world automakers a bare-knuckle ride through boom and bust. A new study likens the country’s car market to a rollercoaster – but then claims that it is now “firmly back on track”.

According to Boston Consulting Group, Russia will have replaced Germany as Europe’s largest market for cars and vans by 2018 and be the world’s sixth-largest car market by 2020, up from tenth place now.

But hang on a minute – haven’t we heard this one before? Continue reading »

Tags: , Posted in Russia |

Going Tanzanian with Barrick

February 16, 2011 3:07 pm by beyondbrics
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By Barney Jopson and Christopher Thompson

African Barrick Gold, as its name says loud and clear, is a punt on the yellow metal. But the UK-listed miner, which doubled its annual pre-tax profit last year, is also the only way of getting real exposure to Tanzania via the London stock market.

All the company’s production and exploration assets are located in the east African country and gold has helped its economy to grow at an average of 6.8 per cent a year over the past decade. Continue reading »

Tags: , Posted in Tanzania |
From ft energy source blog February 16, 2011

The story of Gazprom is the story of interdependence. The Russian energy giant, benefiting from monopoly control of natural gas exports, is one of the central pillars of the state.

Last year, the Kremlin depended on this single company for 15 per cent of its tax revenues. Gazprom, in turn, depended on gas sales to Europe for most of its export earnings, which totalled $72.4bn last year, while supplies to the world beyond the former Soviet Union accounted for $52.8bn. Continue reading »

Posted in Russia |

India: FDI, what FDI?

February 16, 2011 2:08 pm by James Lamont
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Indian commuter railway in Mumbai - the system needs investment and foreign technologyCometh the hour, cometh the committee. A stock response to a crisis in India is to call together a committee and order up a report.

In the case of a dramatic drop in foreign direct investment into what is a huge emerging market, the report cannot come soon enough to understand better a sudden reversal in fortunes.

The rapid decline in FDI is alarming. Foreign companies seem keen to sell things to India’s 1.2bn people but they are less enthusiastic about putting capital into businesses in India. Continue reading »

Tags: Posted in India |

Poland: borrowing less, paying more

February 16, 2011 12:15 pm by Jan Cienski
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With reduced borrowing needs and one of Europe’s best-performing economies, Poland expects to have little trouble selling its sovereign debt this year. But it will come at a cost. “The era of cheap debt is ending,” Dominik Radziwill, deputy finance minister, tells beyondbrics.

Borrowing costs are expected to rise this year, thanks to an increase in inflation, which surprised on the upside in January by coming in at an annual rate of 3.8 per cent. The central bank has already increased its benchmark rate by a quarter point from its previous record low of 3.5 per cent, and further hikes are expected later this year. Continue reading »

Tags: , Posted in Poland |

New York headlines

February 16, 2011 12:13 pm by beyondbrics
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* Singh moves to end Indian deadlock

* China and Russia sell US Treasuries

* India seen as least preferred among Asia Pacific markets

* Ukrainian growth ‘better than expected’

* Huawei in challenge to US Continue reading »

Posted in Global |

Asia markets wrap: Shanghai leads rally

February 16, 2011 12:12 pm by Ranjit Lall
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Shanghai led gains for Asian stocks on Wednesday, on speculation that industrial companies will not be hit hard by the government’s tightening measures – and may even benefit from the side effects. Asian currencies were relatively flat against the dollar.

“Industrial companies [in China] are expected to benefit from investments being diverted from the property sector,” said Tu Jun, a strategist at Shanghai Securities. “These companies are also more immune to inflationary pressure.” Continue reading »

Posted in Asia, Global |

PE unfazed by China property “bubble”

February 16, 2011 11:09 am by Henny Sender
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While the brokers churn out research fretting about a possible slowdown in China’s property market as a result of inflationary pressures and tighter monetary policy, their fears hadn’t infected most participants at the PERE (private equity real estate) Forum in Hong Kong February 15 and February 16.

Indeed the mood was positively optimistic. Most attendees confessed to being surprised by just how resilient the real estate market has been in the face of policies from Beijing to damp down both demand and prices. For example, only 2 per cent of the participants thronging the meeting room at the Four Seasons hotel thought restrictions on bank lending posed any risk at all to the property story in China. Continue reading »

Tags: , , Posted in China |
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