There seems to be have been a small uptick in risk appetite this week towards emerging market funds, with equities in favour among investors.
Emerging-market equity funds took in $1.9bn in the week to Wednesday, while those targeting bonds attracted $172m, according to investment banks citing EPFR, the research company. Read more
Pension funds that once limited themselves to putting the odd toe into emerging markets are starting to get used to the water.
But few have taken as much trouble in charting these sometimes unpredictable seas as the Ontario Teachers’ Pension Plan which likes to pick a small range of EM investments and bet big. Read more
China hosts the world’s biggest yearly mass migration during Lunar Year/Spring Festival celebrations, but the pushing and shoving involved with returning home doesn’t stop there. The travel rush is also spilling to Europe, where beleaguered economies are hoping to benefit from the bonanza.
Paris is rolling out the red carpet for Chinese tourists as soon as they touch down on French soil. Read more
The United Arab Emirates has become the latest country with which China has signed a currency swap agreement, worth 35bn yuan ($5.5bn), aimed at promoting bilateral trade and that could boost the renminbi’s role in the Middle East.
The agreement will be effective for three years, Reuters reports, and was announced by the People’s Bank of China (PBOC) during Chinese premier Wen Jiabao’s regional tour amid efforts to secure key energy supplies. Read more
The old adage of China using the same word for crisis and opportunity may seem particularly apt when looking at the eurozone. Chinese companies are eager to use Europe’s debt woes to boost their clout in the world’s biggest single market.
That’s the view of PricewaterhouseCoopers which plays down any China growth concerns and the effects of Europe’s economic slowdown. Not only have Chinese companies snapped up well-known brands at bargain prices and acquired cutting-edge technological skills, but are increasingly pinning their growth strategies on overseas markets. Read more
For all the hoopla surrounding Myanmar as the new Wild West following its half-century of isolation, a truly frontier market is its banking sector – ATMs became available just two months ago. But one bank has picked up the challenge.
Standard Chartered, the British bank, was the first lender to openly express interest in returning to Myanmar, having been the first foreign bank to set up shop in 1862 when the country was a British colony. Read more
The purchase by China’s state-owned Shandong Heavy Industry Group of Italian luxury yacht builder Ferretti Yachts conjures up images of Chinese glitterati sunbathing on gleaming white vessels and the blossoming of an eastern riviera.
China’s luxury market is booming, with Rolls-Royce reporting record sales and Western fashion designers opening flagship stores across the country. Yet in spite of this obvious appetite for bling, analysts say durable luxury goods are considered sound investments for the wealthy in China, many of whom are young entrepreneurs. Read more
Asian stocks were broadly up on Tuesday as speculators bet China and India would loosen monetary policy to fight slowing domestic demand.
Shanghai’s SSE index surged 2.7 per cent after weaker than expected trade figures prompted hopes of government action. Hong Kong’s benchmark Hang Seng index closed the day up 0.7 per cent, South Korea’s Kospi jumped 1.5 per cent and Taiwan’s benchmark index closed up 1.2 per cent. India’s Sensex closed up 2.3 per cent. Read more
Some investors are eyeing Polkomtel’s announcement last week to sell €900m of junk debt as a modest signal that central and eastern Europe can build up its domestic bond markets and attract more investors seeking high-yield returns.
The size of the deal — the first high-yield or junk issue in Europe in more than two months — has even boosted hopes among some emerging market investors that bond issues can perhaps fill some of the gap that will be left by western banks as they reduce exposure to CEE. Read more
Far be it from beyondbrics to encourage schadenfreude among EM investors. But it’s hard not to notice the difference in fortunes between Mexico and its one-time colonial masters in Spain shown by purchasing managers’ indices published on Tuesday and Wednesday. Read more
It may not be as sensational as hurling a shoe at a statesman but Indonesians are turning to their favorite footwear as a symbol of simmering frustration against the country’s corrupt elite.
The peaceful protesters are tapping widespread unease about standards of public behaviour in the country. But the extent of corruption – and an acceptance in the investor community that Indonesia cannot advance quickly without it – suggests their struggle will be a hard one. Read more
While European debt capital markets have struggled this year, investor appetite remains healthy, to say the least, in Asia.
Bolstering a recent report that China has clinched the top spot as the number one venue for initial public offerings, new data show corporate bond volume in greater Asia (excluding Japan) hit a record high this year. Read more
Abu Dhabi has again rescued struggling developer Aldar Properties with a massive US-style bailout, as a collapse in the real estate market erodes the emirate’s cultural ambitions in the Gulf.
The government has announced it will buy some prized assets from Aldar for Dh16.8bn ($4.57bn) – the second bailout this year for the developer behind Ferrari World, the world’s biggest indoor theme park. That would put government spending on the developer this year to Dh36bn. Read more
Italy’s coffee roasters are turning to emerging markets as demand there is set to overtake developed markets in the next few years. This has yielded an interesting and potentially lucrative phenomenon – beans supplied by producers like Brazil are finding their way back home.
“It’s like selling ice to the Eskimos but it’s working,” Andrea Illy (pictured), CEO of illycaffè, the family-owned Italian coffee maker, told beyondbrics. Read more
Egypt is still struggling with the consequences of the uprising that toppled president Hosni Mubarak. The early hopes of the those who joined in the Arab Spring have not been fulfilled in a country wracked by political tensions and growing fears about its economic stability. Read more
By all measures – Ghana, with its gold and oil wealth, stable government, and double digit growth, can be considered an African success story.
However, as an FT Special Report on Thursday pointed out, the country also faces its share of challenges. Heavily potholed roads and containers stacked high in tightly-packed Tema port attest to Ghana’s difficulties in handling break-neck growth. And in spite of the boom, that growth has not translated into job creation nor development such as education. Read more