Daily Archives: Feb 17, 2012

After what was looking like a so so fourth quarter corporate reporting season, the week has ended on a more optimistic note in Brazil on a mix of good company financial results and improving macro-economic fundamentals.

Latin America’s largest cosmetics company, Natura, led the way, beating forecasts with a 33 per cent increase in net profit to R$290.7m in the three months to end-December compared with a year earlier. Analysts surveyed by Bloomberg had predicted R$255.3m. Read more

Discussion on emerging market growth usually centres on how factors such as inflation, industrial production or even corruption can affect the economies of these countries.

However, a report released this week offers a timely reminder at how malnutrition, an obvious symptom of poverty, is eroding the economic prospects of developing nations, from India and Bangladesh to Peru and Nigeria, which are only just recovering after the fall-out of the financial crisisRead more

Photo: Bloomberg

What a week it has been for Grupo Elektra, the electrical-goods retailer and low-income bank controlled by Mexican billionaire Ricardo Salinas Pliego.

Just a couple of days after the company announced the acquisition of Advance America, a leading US lender, it reported a huge leap in fourth-quarter profits on Friday. Net income came in at about 11.1bn pesos compared with 2.4bn pesos during the same quarter a year before. Read more

You have to wonder what’s going on at the Brazilian Football Confederation, the body that runs the game in the land of Pelé.

Ricardo Teixeira, the confederation’s head, has named former striking star Bebeto to the committee charged with organizing the 2014 World Cup. Bebeto will line up alongside another former World Cup winner, RonaldoRead more

While the eurozone sputters into a recession, Poland’s economy continues to do well: industrial production numbers released today show an annual increase of 9 per cent in January.

“Polish industry is still strong,” writes Malgorzata Starczewska-Krzysztoszek, chief economist with Lewiatan, the Polish employers confederation. She notes that the decent numbers came in despite a strong January 2010. Read more

It was a hollow victory. Nursultan Nazarbayev, Kazakhstan’s authoritarian president, must have savoured the moment on Thursday when London’s High Court sentenced Mukhtar Ablyazov, the former chairman of Kazakhstan’s BTA bank, to 22 months in jail.

But putting Ablyazov behind bars – or trying to: he failed to show up in court – will do nothing to get back the missing billions that the tycoon allegedly misappropriated from the bank. Read more

To say it’s been a turbulent period for Impala Platinum (IMP:JNB), the world’s second largest platinum producer, would be stating the obvious.

Extreme price volatility for platinum,  currency fluctuations, and controversial plans by the Zimbabwe government to have local investors take control of the country’s mines, including Impala’s Zimplats.

And on top of all this, the South African group has been dealing with an acrimonious month-long strike at its biggest mine at Rustenburg,  – a sometimes-violent dispute that cost Implats around 60,000 ounces of production and R1.2bn in revenue.  Some tough challenges for long-serving CEO David Brown who is leaving in June – and, in all likelihood for his successor. Read more

This week, India’s Reliance Industries received some good news and delivered some bad.

On Friday, Bloomberg reported that RIL and its British partner, BP, had received government approval to develop a natural gas discovery, the R1 deposit, in the Krishna Godavari basin in the Bay of Bengal. But it was small consolation for the week’s earlier news. Read more

By Frederic Neumann of HSBC

Investors’ eyes are still locked on Greece. But some sort of Greek deal is already in the price in the markets. What isn’t, however, and what now presents a big risk, is oil.

Geopolitics and plenty of liquidity have quietly driven the price of Brent to $120 a barrel. This is where it starts to hurt. Even in Asia. Read more

Are you a fund manager looking for new business opportunities? Perhaps it’s time to look to Latin America.

State Street, a Boston-based fund manager and service provider, has identified the region as “a strategic marketplace for money management”. Recent expansion of pension funds, sovereign wealth funds and mutual funds makes it make it “particularly attractive to asset managers looking to sell products or for places to invest, as well as for financial service providers”. Read more

Last week we reported record inflows into emerging market bond funds – so a slowdown was always going to be likely.

But while fixed income inflows did indeed decline in the week to Wednesday, they still look solid, at $637m in the sample universe monitored by EPFR, the Boston-based fund tracker. And with investors increasingly hopeful of a decisive resolution to the eurozone crisis, Royal Bank of Scotland reckons the good news will keep on coming. Read more

* China says not yet formally invited to Syria meeting

* Sudan and South Sudan agree to start drawing border

* Argentina’s capital flight slowed from record pace on Fernandez controls

* Athens faces tough bail-out terms Read more

By Gregory Chin of York University, Canada

The announcement of Robert Zoellick’s departure as World Bank president has triggered another round of debate on the selection of the next head of a major Bretton Woods institution. Demands are growing to break the 65-year old tradition of automatically selecting an American the next head of the World Bank. There are other clear alternatives. Read more

Brazil is a star of emerging markets but its fundamentals raise serious questions. John Authers, Long View columnist, and Jonathan Wheatley, deputy emerging markets editor, discuss whether Brazil is a good investment.

Najib Razak, PM of MalaysiaMalaysia’s growth last quarter beat expectations, and the outlook for 2012 looks pretty solid too.

But with some reforms running into the sand, corruption scandals grabbing headlines, elections looming,  and the general gloom enveloping export-driven nations, Malaysia risks backsliding in its attempts to make sure its middle-income economy doesn’t stall. Read more

Friday’s picks from the beyondbrics team: China’s rocketing demand for gold betrays fears about the sustainability of its economic miracle; while its most popular social network is threatened by competition, says Lex; why Pakistan’s democratic politicians should confront Islamists who have only limited electoral support; and Indonesia’s resilient, resurgent economy.
 Read more

South Korean chipmakers headed by Samsung Electronics could be forgiven for rubbing their hands with glee at the sight of the financial troubles at their Japanese rival Elpida Memory.

With Elpida’s survival in doubt, shares of Samsung hit a record high of Won1.18m on heavy foreign buying on Friday while second-ranked Hynix Semiconductor was trading at Won28,850, near a nine-month high. But what might be good news for the producers won’t be welcome for their customers. Read more

When Haier said that it was setting up a regional headquarters in Japan, it did not make big news headlines.

But the Chinese white goods maker’s move indicates just how far it has advanced on its path towards globalisation, and that it is expanding its foothold in more demanding developed markets. Read more

China’s Minmetals Resources (MMR) has finally achieved its ambition of getting into Africa, with the completion on Friday of its C$1.3 bn ($1.3 bn) bid for Anvil Mining and its interest in the Kinsevere copper project in the the Democratic Republic of Congo (DRC).

But the Chinese state-run group and its western boss (CEO Andrew Michelmore,  pictured) remain on the lookout for more overseas acquisitions and have plenty of funds for the right deals. Anvil is a modest buy compared to the $6.6bn Minmetals put on the table last year in a failed attempt to take over Canada’s Equinox Resources. Read more

Has Taiwan’s economy turned the corner? There are many who would say not yet. Export orders, which are forward-looking, remain anaemic, and economists expect January industrial output numbers to also be weak because of Chinese New Year.

But Wai Ho Leong, economist at Barclays Capital, argues that there is cause for optimism. Read more