Daily Archives: Jun 1, 2012

At first glance, Brazil’s GDP data on Friday just seemed a bit weird.

Industry, which has long been viewed as the economy’s weak spot, jumped 1.7 per cent in the first quarter from the previous three months. While that may not seem like much for a supposedly ‘booming’ BRIC, it was rather miraculous given that overall GDP rose only 0.2 per cent. Read more

Need further proof that Mexico’s star is rising among foreign investors?

Consider this: the country this week braved the choppy global market to pull off a Y80bn ($1bn) issue of “samurai” bonds, or yen-denominated debt, in Japan.

The sale is significant on a number of levels. Not only did Mexico raise a good sum of money, but it did so without having to offer any collateral (an indication of Mexico’s improving credit quality). The fact that the buyers were predominantly Japanese also underscores the growing perception of Mexico as a safer investment thesis thanks to its improving fundamentals and export-led growth engine. Read more

What are Argentines to think when the government tells them to save in pesos, not in dollars (which bitter experience of economic crisis has taught them can be a safer bet) – and then one prominent figure turns round and admits that he saves in dollars himself and has no intention of selling until the unofficial exchange rate drops? Read more

By Nicholas Watson of bne

In yet another example of foreign investment finding its way into Russia’s promising ecommerce market, a group of private equity firms tells bne it has struck a deal to invest $45m to take a minority stake in B2B-Center, Russia’s largest online procurement player.

Private equity investors are particularly looking to the new generation of companies serving Russia’s promising online consumer and business-to-business markets, many of which have either become or are set to become Europe’s largest over the next few years. Read more

A big disappointment from Brazil’s statistics agency on Friday: GDP growth came in far below expectations in the first quarter at 0.8 per cent year on year and just 0.2 per cent over the previous quarter.

The figures will set alarm bells ringing in Brasília, where the government has been doing all it can to kick start the flagging economy. Read more

Just when you thought last year’s Arctic debacle between Rosneft, BP and AAR was a distant memory, something happens that throws all the cards into the air all again.

BP’s announcement that it will pursue the sale of its half of TNK-BP suggests we are gearing up for a whole new game of chicken between BP and AAR. And it’s unclear whether AAR will end up the winner this time. Read more

The tide that turned last week is still running out. Investors once again withdrew money from EM bond and equity funds in the week to Wednesday as the twin spectres of crisis in the eurozone and a sharper than expected slowdown in China continued to stalk the markets.

EM bond funds had outflows equal to 0.41 per cent of assets under management or $465m in the sample universe tracked by EPFR, the Boston-based fund flow watcher. EM equity funds had outflows of 0.19 per cent of AUM, or $1.15bn. Read more

* BP to pursue sale of stake in Russian arm

* China’s factory output weakens

* Emerging Stocks Extend Monthly Rout On China, India Data

* Crude oil prices slide below $100 Read more

In Friday’s story picks, BB hits the road: we follow Putin on his trips abroad; see a stimulus on the road to Chinese happiness; are stopped by a dam in Chile, slow down, then hit a wall in India, and confront another one in China. And looking above, we see a dark IPO cloud in Asia and a threatening cyberjet in China. Read more

After a very rough day for the Indian economy, which, it was revealed on Thursday, grew just 5.3 per cent in the quarter ending in March, Friday showed a glimmer of hope. Manufacturing in the subcontinent in May continued to grow at a steady pace, despite slowing slightly from the previous month. Read more

The warning signs have been coming out of China for a while now. After last month’s rather worrying data, the latest PMI figures won’t help. China’s official purchasing managers’ index for manufacturing fell to 50.4 in May, its lowest in five months. April was 53.3.

And the pain now seems to be hitting the bigger, state-backed companies, who have, up until now, seemed better insulated. Read more

Is the sky the limit for China’s foreign exchange reserves? Apparently not. After years of exponential growth, the towering pile of Chinese reserves may finally be close to hitting the ceiling.

Nomura has called the top: $3.68tn at the end of 2014, up from a mere $150bn at the start of 2000. China’s reserves will then start to decline, albeit gradually, in 2015.  Read more

* China’s factory output weakens

* Russian ruble falls to 2009 crisis levels

* Lazard hires former Brazilian central banker Read more

Is the retreat by mainland Chinese buyers to be blamed for a 32 per cent drop in total sales at Christie’s spring auctions in Hong Kong, which concluded on May 30?

No, says the auction house’s Asian chairman. It’s the sellers. The reserve prices for some items were set too high on the vendors’ insistence, says François Curiel, President of Christie’s Asia. This may well have been the case for Wednesday’s sale of imperial Chinese ceramics and works of art, where over a third of the lots were left unsold. Read more

It ain’t about any (alleged) bribery. It’s about the boxes. That’s the word from Walmart, the big box retail behemoth, on why it’s slowing down new store openings in China, where it’s been struggling.

As allegations of bribery in Mexico hang over its annual meeting on Friday, a top Walmart executive said it was cooling expansion in China to make sure it could find plain old box-shaped stores, which shoppers like, and no geometrical oddities. Read more

Ivan Ramalho does not think the government of Brazil is becoming more protectionist.

But the head of Abece, Brazil’s industry group representing international trading companies, says there are some sectors that are becoming more protectionist and some of them have the government’s ear.

“There is an intent that exists today, not in industry as a whole, but in some specific sectors towards more protection,” he said. “They want, of course, more protection and with more protection, prices will increase.” Read more