Asia - Economic Data & News 01 (Jun 08 - Jun 16)

Re: Asia - Economic Data & News

Postby kennynah » Sun Nov 02, 2008 1:50 pm

millionairemind wrote:
It used to be that we searched for economic icebergs in Asia. Now we are on the lookout for Icelands.

Last month, Iceland became the first developed economy to seek aid from the International Monetary Fund since 1976. The country needed a $2.1 billion bailout after investors realized it wasn't running an economy, but a hedge fund.



cant even handle a 2.1 billion problem...iceland should not even be classified as a developed country...lesser than a 3rd world country status perhaps..

i cannot think of any asian country that has reserve lesser than 2.1 billion... do u ?
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Re: Asia - Economic Data & News

Postby winston » Wed Nov 12, 2008 10:55 pm

Asian Emerging Markets are Attractive, Morgan Says (Update1) By Chen Shiyin

Nov. 12 (Bloomberg) -- Asian emerging-market equities have become more attractive as governments intervened to support economic growth and oil prices slumped, Morgan Stanley said.

The brokerage is recommending investors buy more Asian technology and financial stocks at the expense of energy and commodity producers in Latin America and emerging Europe. Morgan Stanley favors stocks in South Korea, Taiwan and China, whose government announced this week a 4 trillion yuan ($586 billion) package to bolster expansion.

“Asia is already showing it’s more able to engage in self help,” said Jonathan Garner, the brokerage’s London-based head of emerging market strategy, in a Bloomberg Television interview in Singapore. “You are not getting the same aggressive countercyclical policies” in the Middle East, Africa and Latin America.

The MSCI Asian Emerging Market Index has lost 56 percent this year on concern the global economic slowdown will hurt profits among the region’s companies. That about matches the main MSCI Emerging Market Index’s 55 percent slump and surpasses a 45 percent tumble in the MSCI Asia Pacific Index.

Asian stocks rallied on Nov. 10 after China, whose economy is the biggest contributor to global growth, said it will increase infrastructure spending, tax deductions and farming subsidies. The package is equivalent to almost a fifth of the nation’s gross domestic product.

‘Solid’ Ground for Recovery

China’s CSI 300 Index has dropped 66 percent this year, the biggest decline in Asia and the eighth-worst performer among the 89 global stock benchmarks tracked by Bloomberg.

“The ground for recovery in China is definitely much, much more solid than in any other part of the world,” Morgan Stanley’s China strategist Jerry Lou told reporters in Singapore today. “Right now the stock market has landed already. We will be looking for early recovery signs to turn more bullish.”

Taiwan’s central bank this week also lowered its benchmark interest rate for the fourth time in two months, while South Korea last week slashed borrowing costs for the third time in four weeks. Brazil, Russia, India and China, the so-called BRIC nations, plan coordinated measures to increase trade and capital flows between their economies, Russian Finance Minister Alexei Kudrin said at the weekend.

The region’s central bankers may have room to further reduce rates with the decline in crude-oil prices, Morgan Stanley’s Asian strategist Malcolm Wood said.

Oil futures fell yesterday to the lowest since March 2007 and prices have tumbled 60 percent since reaching a record $147.27 on July 11.

Not As Severe

“Central banks in Asia have room to aggressively cut rates further,” Wood estimated. “They’ve already given us a good 100 basis points and they’ll give us another good 100 basis points over the next three to four months.”

The slump in Asian stocks has also made valuations more attractive. The MSCI Asia-Pacific Index’s price-to-earnings ratio on a trailing basis fell to a low this year of 8.9 times on Oct. 27, down from 17.7 times at the start of 2008.

Earnings will probably decline by a “high single digit” in Asia next year, compared with investors’ assumption of a drop of at least 40 percent, Wood said.

“The market seems to be assuming something cataclysmic for Asia,” Wood told reporters. “We think it’s bad, but nothing as severe as that.”
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Re: Asia - Economic Data & News

Postby winston » Sat Nov 15, 2008 11:09 am

Asia's Emerging-Economy Exports May Slump 20%, Nomura Says By Michael Dwyer

Nov. 14 (Bloomberg) -- Exports from Asia's developing economies may decline 20 percent over the next year as a deepening global slowdown hurts demand for the region's products, Nomura International (HK) Ltd. said.

``In September 2008, aggregate exports for Asia ex-Japan grew by 21 percent year-on-year,'' Robert Subbaraman, an economist at Nomura in Hong Kong, wrote in a report yesterday. ``In 12 months time, we would not be surprised if the number is about the same, but with a negative sign in front of it.''

Exports from Asia's emerging economies have held up until recently, as shipments to other destinations made up for weaker sales to the U.S. That's changing as the economic downturn becomes ``global and synchronized,'' and a slump in commodity prices erodes incomes in oil-producing nations, Subbaraman said.

China's exports grew at the slowest pace in four months in October, with overseas shipments rising 19.2 percent from a year earlier, after increasing 21.5 percent in September.

South Korea's overseas sales, which account for more than half of gross domestic product, increased 10 percent in October from a year earlier. That was the weakest pace in 13 months.

Taiwan's exports fell by the most in more than three years last month on weaker demand from China, the island's biggest market. Shipments dropped 8.3 percent from a year earlier, compared with a 1.6 percent decline in September.

Asia's developing economies are almost twice as reliant on exports as the rest of the world, with 60 percent of their overseas sales ultimately destined for the U.S., Europe and Japan. Growth in the region is cooling as a global slump hits demand for made-in-Asia laptops, mobile phones and televisions.

``The downturn is deepening,'' Subbaraman said. ``We expect Asia ex-Japan to be hit hard by this global financial crisis and the impending recession.''
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Re: Asia - Economic Data & News

Postby helios » Sat Nov 29, 2008 9:30 am

China - China's Zhejiang province and Singapore have agreed to collaborate on infrastructure, port and logistics, business process outsourcing and environmental services.

Singapore's transport minister Raymond Lim and Zhejiang's vice governor Zhong Shan signed the agreement at the fifth meeting of the Singapore-Zhejiang Economic and Trade Council (SZETC) in Hangzhou last week.

Lim said Singapore companies doing business in Zhejiang, including Acendas, CapitaLand, Hyflux and YCH Logistics, will contribute to the province's continued growth.

The agreement also outlined plans for Meishan Island of Ningbo City to become a first-class bonded port.

Singapore is Zhejiang's 11th largest trading partner. Bilateral trade between the two reached US$2.04 billion in 2007.


San's comment: YCH is not listed ... SME-sized.
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Re: Asia - Economic Data & News

Postby winston » Sun Dec 21, 2008 9:27 am

20081216 Macquarie Asia strategy - Five unlikely events for 2009

Event

We speculate on five unlikely, but not inconceivable, macro events for 2009.

Outlook

A large part of investing is about forecasting, so investors tend to focus most on what is likely to happen. But it is also worthwhile spending time thinking about events that are unlikely, both because doing so helps to make a more informed judgement about the balance of risks to any base case, and because these are events that, by definition, are likely to yield high returns.

We performed this same exercise this time last year and, quite amazingly, of the five events we chose, two have occurred and another two have occurred in part. The events we chose and the results are shown in the table opposite.

Our five events for next year are:

Asian equities fall steadily all year. While there is considerable disagreement about the precise timing, nearly all analysts and investors (including ourselves) expect Asian equities to stage some form of recovery some time next year. But given the magnitude of the economic challenges, and the fact that this bear market has been relatively short by historical standards, this is far from guaranteed.

China grows at 8% or more next year. Just like it was fashionable last year to believe that China's structural drivers were so powerful that growth could never drop below 8%, this year sell-side analysts have been tripping over themselves to have the lowest possible forecast for Chinese growth for 2009. Growth north of 8% would now be a major surprise. But with some tentative signs of improvement in the property market and an aggressive policy response from Beijing working its way through the system, 8% growth for next year is still possible.

Banks outperform. It is now an accepted market truth that NPLs will rise and potentially rise quite sharply next year. As Asia's economies grind to a halt (or worse) unemployment will rise and corporate bankruptcies will intensify, causing banks to underperform. But with debt levels low, interest rates being cut aggressively, and Asia's banks in fundamentally good shape, this is a far from certain outcome.

India outperforms China. While there is currently no shortage of bears on China, very few investors expect India to perform any better next year. Excessive valuations, naively optimistic earnings estimates, and a domestic economy that is decelerating rapidly are the standard investor concerns about India. But in recent months valuations have improved dramatically, earnings estimates have been slashed and the policy response has been surprisingly aggressive.

The US is the strongest economy in the G7 next year. An improvement in residential construction activity may not be far off and if the consumer spending/saving adjustment is less severe than many (including ourselves) currently expect, there is the potential for the US economy to return to growth as early as 2Q09.
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Re: Asia - Economic Data & News

Postby millionairemind » Mon Dec 22, 2008 8:34 am

Published December 22, 2008

Equities '09 rebound shortlived: Macquarie
Although driven by export growth and fiscal stimulus, growth will still stall

By CHEW XIANG

EQUITY markets in Asia are expected to start recovering from Q2 next year but the bounce is likely to be shortlived, according to Macquarie Research chief strategist Tim Rocks.

Still going strong: 'DBS Group will benefit from access to cheaper funding sources, compared with its peers, as we see intensifying competition for deposits, particularly fixed deposits', says Macquarie analyst Soong Tuck Yin
In his outlook report for 2009, Mr Rocks said the expected rebound, driven by export growth and fiscal stimulus, should peter out by the end of the year.

'Fiscal stimulus does not turn out to be enough to spark a sustainable recovery, and growth falls again once the money works through the system,' he said. 'More fiscal stimulus is needed to provide another boost to the economy, and this eventually does lead to a real recovery during the course of 2010.'

'Taiwan, Korea and Thailand tend to be the best-performing markets when equity markets bounce, and we would expect this to be repeated from 2Q09. Before this time, we would be positioned in China, Hong Kong and Singapore,' Mr Rocks said.

For Singapore, Macquarie analyst Soong Tuck Yin in the same report said he was overweight on the country as it is trading at 9.6 times forward FY09 earnings. Companies that will emerge stronger from the downturn were DBS Group, CapitaLand and Wilmar, he said, while telcos and media will be the most resilient.

'DBS Group will benefit from its access to cheaper funding sources, compared with its peers, as we see intensifying competition for deposits, particularly fixed deposits,' Mr Soong said. And as foreign banks start cutting back lending after problems at their head office, 'we believe DBS has the best opportunity to take market share, given their excess funding position in the S$.'

DBS also has the smallest exposure to SMEs of the three local banks and this is likely to help reduce non-performing loans, he noted.

Wilmar, too, is seen growing strongly, given its strength in palm processing and merchandising, Mr Soong said, while lower commodity prices will reduce working capital requirements and gearing levels, he said.

For CapitaLand, Mr Soong said its asset divestment strategy - which has seen the property giant sell $9 billion of assets and invested less than half of it in the past two years - has worked well.

'The group has a high cash position of $4.2 billion and we believe CapitaLand is in a very healthy position to consider tactical acquisitions and investments,' he said.

Other top picks were Singapore Press Holdings, which owns this newspaper, and SingTel.

On a macro level, 'the focus will be the 2009 budget,' said Mr Soong. 'We expect it to be expansionary, with likely cash handouts to help low income families and business cost savings measures such as lower property taxes and waivers of stamp duties.

'The most draconian measure may be lowering the employer's CPF contribution from the current 14.5 per cent to, say, 10 per cent. This was done twice - in 1999 and 2001 - when the economic situation was weak,' he said.
"If a speculator is correct half of the time, he is hitting a good average. Even being right 3 or 4 times out of 10 should yield a person a fortune if he has the sense to cut his losses quickly on the ventures where he has been wrong" - Bernard Baruch

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Re: Asia - Economic Data & News

Postby millionairemind » Tue Dec 30, 2008 4:48 pm

Published December 30, 2008

Asian stocks showing signs of bottoming out
Investors betting on region, with its low debt, high savings


(HONG KONG) From healing credit markets to big government stimulus spending, evidence is mounting that the historic 2008 sell-off may be fading into the history books.

While few market players are bold enough to say that the worst is over for Asian stocks, which have lost about half of their value this year - a record in at least 20 years, the telltale signs that several markets may have bottomed out are becoming clearer.

Credit markets, which tend to lead equities both up and down, kept recovering even as stocks pulled back at year-end.

Narrowing spreads on US interest rate swaps, an important gauge of financial system health, are another encouraging sign.

South Korea's severe dollar funding shortage for domestic banks - one of the key pressure points in Asia - has started to relent just as the won has bounced and Seoul stocks have led the rally in regional shares.

Central banks have slashed rates like never before, with the world's two largest economies now with short-term rates at virtually zero. Governments are lining up massive spending packages, which are expected to start reviving growth some time next year.

And global investors, who fled the region amid a worldwide retreat from risk set off by the meltdown of the US housing credit market, are coming back.



Data from fund tracker EPFR Global showed Asian shares outside of Japan attracting cash in five straight weeks through last Wednesday, lifting currencies such as the won, which hit a two-month high, and the Philippine peso .

'Once recognition of a bottom in global equities spreads and the markets regain their composure, the momentum of the rally in Japan and other Asian equities is likely to build,' said Yutaka Yoshino, an equity analyst at Nikko Citigroup in Tokyo.

In another encouraging sign, market volatility has come off its historic peaks, though economists warn that rapidly changing economic conditions mean more stomach-churning market swings for investors.

'Market volatility will decline periodically, but economic uncertainty is higher than ever. Just as volatility remained high for a number of years during the early 1930s, it may take some time to durably decline this time around,' said economists at Societe Generale.

Investors seem willing to bet that Asia, with its low debt, high household and public savings and limited exposure to the toxic US mortgage debt at the heart of the current crisis, will ride out the slump better than the rest of the world.

Most Asian governments, especially China, have deeper pockets than their US and European peers and can do more to encourage households to spend more and save less, providing some cushion to the collapse in exports.

Reflecting this optimism, Asia-Pacific shares outside of Japan gained 23 per cent since most markets hit bottom in late November, outpacing the 18 per cent rise in the MSCI World index and US S&P 500.

The gains come against the backdrop of some of the bleakest economic data in decades and the question is whether markets have already fully accounted for the hit to company earnings from the economic downturn and damage to currencies from low interest rates.

Many analysts seem to believe that this is the case and point to investors' composure in the face of the latest grim statistics.

Japan's Nikkei average rose nearly 2 per cent last week despite data showing both exports and industrial output plunging in November at the fastest pace on record. The yen, which tends to closely track stocks and move in the opposite direction, posted its biggest weekly loss in seven weeks.

Most analysts expect a market recovery next year though they say that the first half will be tough, with companies publishing their results and revised outlooks while fiscal spending is still waiting to kick in.

Equity analysts at Merrill Lynch say that the slide in the MSCI Asia-Pacific index has already accounted for the expected deterioration in earnings and slow turnaround.

They expect the index to hold above its all-time low of 194, hit last month, and to climb as high as 350 next year. -- Reuters
"If a speculator is correct half of the time, he is hitting a good average. Even being right 3 or 4 times out of 10 should yield a person a fortune if he has the sense to cut his losses quickly on the ventures where he has been wrong" - Bernard Baruch

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Re: Asia - Economic Data & News

Postby millionairemind » Wed Jan 07, 2009 8:43 am

Published January 7, 2009

Asian stocks may soar 43% this year
Valuations becoming more attractive, sentiment positive: DBS report


By GENEVIEVE CUA

ASIAN equity could be in for a substantial 43 per cent bounce over the next 12 months, thanks to attractive valuations, says DBS regional equity strategist Joanne Goh in a report.


Bullish propsects: China (above) and India have the the highest GDP growth forecasts for 2009 among 46 countries and rank ahead of the US in earnings growth

Separately, State Street Global Markets' Investor Confidence Index for December shows that while confidence among North American investors fell sharply from November, institutional investors in Asia bucked the trend. For the latter, confidence rose from 82.2 to 86.1.

European investors were slightly less pessimistic than North American investors, but their confidence still fell to 67.4 from 72.5 in November.

The index measures investor confidence quantitatively by analysing actual buying and selling patterns of institutional investors.

In a report, DBS Group Research's Ms Goh says that the firm's valuation model suggests a positive 12-month forward returns of close to 43 per cent for Asian stocks. This, along with oversold markets, should support Asia markets in the near term.

'Asian markets could take a breather from a freefall as valuations become more attractive . . . The rally should be driven by positive sentiment arising from optimism that aggressive public spending and interest rate cuts would alleviate recession woes.'

Based on DBS's analysis, markets were sold down to 2002 levels, which suggests forced selling, believed to be deleveraging by global financial institutions.

Still, uncertainty remains over the deteriorating labour markets and 'uneven' effects of the fiscal stimulus. Ms Goh says that markets could re-test the lows seen in October 2008 due to uncertainty related to the impact of deleveraging of the US financial sector. '. . . We recommend investors to exercise caution in this brief market rally upon the narrowing of valuation gaps,' she says.

Fund flows may also not resume in force. 'Asia markets will need to offer more attractive growth and valuations than the rest of the world in order to attract fund flows into the region.'

China and India, she says, have the the highest GDP growth forecasts for 2009 among 46 countries and rank ahead of the US in earnings growth. 'Asia valuations, however cheap by its own historical standards and cheaper than the US, are still more expensive than the 8.6 times median of 46 countries.'

She has an overweight recommendation for Singapore, China and Hong Kong on a short-term rebound as well as the flexibility of the countries to handle the economic crisis with policy responses. She has an underweight call on Malaysia, India, Indonesia, Taiwan and Thailand.

Meanwhile, Citi Investment Research says that US$580 million of redemptions from Asian funds in the last two weeks of 2008 took total net outflows for the year to US$19.6 billion, citing EPFR Global data. The outflows suggest that one-fifth of the new money invested in Asian funds in 2006 was redeemed.

Of the US$580 million of outflows, 46 per cent was due to China fund redemptions. Outflows also resumed out of global emerging market and international equity funds. Total net redemptions from the latter two categories came to US$1.1 billion in the last week of December, compared to net inflows of US$4.1 billion in the previous week.

EPFR has reported that cash holdings of Asian funds were lowered by 73 basis points on a month-on-month basis to 3.8 per cent in November. Citi believes that this is 'far too low' compared to 6 per cent in the 2001 downturn. Asian funds remain overweight Singapore and Hong Kong/China.
"If a speculator is correct half of the time, he is hitting a good average. Even being right 3 or 4 times out of 10 should yield a person a fortune if he has the sense to cut his losses quickly on the ventures where he has been wrong" - Bernard Baruch

Disclaimer - The author may at times own some of the stocks mentioned in this forum. All discussions are NOT to be construed as buy/sell recommendations. Readers are advised to do their own research and analysis.
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Re: Asia - Economic Data & News

Postby winston » Wed Jan 07, 2009 8:52 am

Wonder what was their prediction last year ?
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Re: Asia - Economic Data & News

Postby kennynah » Wed Jan 07, 2009 2:11 pm

In a report, DBS Group Research's Ms Goh says that the firm's valuation model suggests a positive 12-month forward returns of close to 43 per cent for Asian stocks. This, along with oversold markets, should support Asia markets in the near term.

very optimistic ...i like....but we must be careful about what others say... hear is good...keep in mind...
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