What market meltdown? Mexico pulls off $1bn century bond
Amid what are unquestionably difficult times, Mexico successfully placed a $1bn reopening of a 100-year bond on international markets on Wednesday.
“Despite the recent volatility in international markets, the federal government has shown its capacity to obtain very long-term financing at attractive cost levels and with a wide range of investors,” the folks from the finance ministry ministry said in a statement. Continue reading »
[Brics and mortar]: Brazil’s slums recycle
Beyondbrics kicks off the second of our mid-year specials with brics and mortar. We’ll be looking at everything from toxic counter tops in China, exploding manholes in Brazil, and missing bricks on the side walks of Moscow, to why Muslims are reconsidering the high-rise life.
Andrew Downie starts the series with his piece on a program to introduce recycling into Rio de Janiero’s infamous favelas below the break. Continue reading »
Brazil: market plunge could provide breathing space on inflation
It remains a mystery just how far south Brazil’s Bovespa index will go. Already the worst performer among the world’s major markets with a fall of about 30 per cent this year, Latin America’s largest bourse was volatile again on Wednesday, declining in the morning before recovering in the early afternoon.
But while the future fortunes of the Bovespa may be anyone’s guess, what no longer seems uncertain is the extent to which Brazil’s central bank will need to tighten the benchmark Selic interest rate this year to quell what was looking like a resurgent inflation rate. In light of the past week’s events, the tightening cycle seems to have come to a sudden halt. Continue reading »
US-Latin America: winds of change?
Some people have fairies at the bottom of the garden; some have Chinese investors. While the United States was busy looking inwards (and towards the Middle East) waves of Chinese investors have entered Latin America - strengthening the idea that the US has neglected its so-called “backyard.”
But for Arturo Valenzuela, Hillary Clinton’s man on Latin America, US President Barack Obama can afford the “luxury” of not paying too much attention to Latin America because things are going relatively well in the region. “It wouldn’t be a positive thing for the US President to talk constantly about Latin America, to think constantly about Latin America, to interfere constantly in Latin America. Those are things of the past,” he tells beyondbrics. Continue reading »
Indian consumer stocks: time to buy?
There are a lot of reasons to be bearish on India at the moment. The country’s stock market is among the world’s worst performers year to date. Inflation is stubbornly stuck at 9 per cent. Growth has been revised downwards to 8.2 per cent even as the central bank continues to hike interest rates at an unprecedented pace.
Yet none of this appears to have put off Emerging Global Advisors, the US-based asset management firm, from taking a punt on Asia’s third largest economy. In fact the group has just launched a a fund focusing on India consumer stocks as a play on the country’s galloping domestic consumption. Continue reading »
South Africa: more data disappoints
For South African businessmen seeking to see more momentum as their country has sluggishly recovered from the economic crisis, the past couple of months would have done little to boost their mood with a wave of strikes and a series of disappointing data. So perhaps it is little surprise that business confidence in Africa’s largest economy fell in July to its lowest point in 14 months.
According to the South African Chamber of Commerce and Industry, the confidence index dipped to 99 from 102.4 in June. Continue reading »
[snap] EM equities: here we go again
So much for the relief rally. Asian stocks rose on Wednesday, European ones followed suit… and then it was all over, at least for now.
Shares in Budapest were down 6.8 per cent at 16:15 BST. Warsaw’s WIG20 index was off 7.2 per cent. Confidence evaporated as soon as markets opened in New York and Wednesday’s whiff of confidence – generated by the Fed’s decision late on Tuesday to leave interest rates low until 2013 – faded away.
Real Madrid scores in China, but will sports fans open their wallets?
Real Madrid returned from its pre-season tour of China on Monday with a 100 per cent winning record, 13 goals under its belt and plans to build the largest football academy in Asia.
The world’s most famous football club will partner with Chinese Super League team, Guangzhou Evergrande, to set up the academy that will enrol up to 10,000 12-13 year-olds in Guangdong province, as Real looks to expand its presence in the far east.
But can Real beat away its rivals and succeed in turning China into a money spinner? Continue reading »
Hollywood: more is less for Chinese consumers
When Transformers: Dark of the Moon entered production in late 2009, marketing executives saw opening before them a new frontier for product placement. Why not cram a truly American plot with Chinese products? OK, so the film has nothing to do with China. But surely Chinese consumers were ready to see their favourite brands on the big screen? And wasn’t Hollywood ready for the likes of Meters/bonwe, a Chinese clothing brand which Shia LaBeouf’s character sports at the start of the film?
Well, that was the thinking. But some vocal Chinese film-goers aren’t buying it. Continue reading »
Indonesia: tools for volatility warchest
Indonesia has earmarked $12bn for a new stabilization fund that will enable authorities to buy up government debt and use surplus cash to cool markets during times of volatility in southeast-Asia’s largest economy.
“This is for when the market hiccups”, Rahmat Waluyanto, the government’s top debt manager, told beyondbrics. “We can do a (bond) buy back.” Such confidence is indicative of a growing regional economy, but is it warranted? Continue reading »
New York headlines
* China’s first aircraft carrier takes to the sea
* Thailand pushes ahead with populist policies
* China’s trade surplus surges to $31.5bn
* Australia’s Westfield expands into Brazil
* Brazilian banker to set up private $1bn fund Continue reading »
The ‘Made in China’ myth – it’s all American
After another whopping monthly trade surplus, the global imbalance drum is beating loudly again. The bigger China’s surplus, so the logic goes, the more lop-sided the economic relationship with the US. So ‘Buy American’, say some, to stop money being sucked out of America and funneled into Chinese coffers (which is then, ironically, funneled back into US Treasuries).
But is the surplus really the best measure of the effects of ‘Made in China’ goods on the US economy? Perhaps not. Continue reading »
Further reading: rent-a-hacker
Wednesday’s top picks from the beyondbrics team: why all that falters is not gold when it comes to gold miners; what China should do with the hoards of dollars in its currency reserves; and the threat of North Korean hackers. Continue reading »
China’s tech-savvy dinosaurs – the PLA app now available on your iPhone
If you are tech-savvy and interested in Chinese military affairs, chances are that you learned of the sea trial of the country’s first aircraft carrier, the Varyag, on your iPhone this morning.
Just in time for Wednesday’s big moment, China’s ministry of defence launched an app in the iPhone app store last Sunday. The app would help users “understand the military hot topics of the day,” said the ministry. Continue reading »
Immense challenges now face the downgraded US and the eurozone, as it tries to keep its currency alive. Luckily, however, there are other important global players and economic drivers – most importantly China, and its worries about inflation, writes Jim O’Neill, chairman of Goldman Sachs Asset Management. Continue reading »
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