Monday, March 29, 2010

Market News for this week


§ US consumer sentiment ended unchanged in March from February. The final March reading for the surveys' overall index on consumer sentiment was 73.6, the same as February's, but slightly above the 73 forecast by analysts polled by Reuters. (Source: BT Online)

§ The US economy expanded at 5.6 per cent in the fourth quarter, the government said on Friday, revising downward an earlier estimate of 5.9 per cent gross domestic product growth. (Source: BT Online)

§ President Barack Obama's administration on Friday announced new plans to help up to four million US homeowners. The measures will tap into US$50 billion worth of funding already set aside to help the housing sector. The administration has already spent hundreds of billions of dollars trying to stabilise the housing market and reduce foreclosures. (Source: BT Online)


§ Singapore's factory output came in better than expected for a third straight month in February, surging 19.1 per cent year on year as global electronics demand strengthened further. On a seasonally adjusted basis, February's industrial production grew 5.9 per cent from January, the Economic Development Board said yesterday. (Source: BT Online)

§ Visitor arrivals to Singapore jumped 24.2 per cent year-on-year to 857,000 last month, the highest ever recorded in the month of February. Visitor days came in at 3.3 million days, up 16.3 per cent compared to the corresponding month in 2009. (Source: BT Online)

§ Leasing market for non-landed homes showed signs of recovery in the final quarter of 2009. Median rents saw their first quarter-on-quarter growth of 0.5 per cent following five quarters of continued decline from a peak in Q2 2008. The monthly median rent in Q4 2009 was $3.02 per sq ft. Occupancy rates also jumped, achieving 94.5 per cent in Q4 2009. (Source: BT Online)

Greater China Region

· An adviser to the People's Bank of China, Fan Gang, says the mainland could adopt a more flexible exchange rate policy once the global economy is back on a sure footing. In an opinion piece, Mr Fan warned that a revaluation of the yuan would not by itself resolve economic problems in the US such as high unemployment and a massive trade deficit. He said China 's politicians have a domestic agenda just like the Americans. The key element of that agenda is to maintain employment growth. (Source: PBOC)

· A residential site in Tung Chung will become the first site to be auctioned in the coming financial year. A developer triggered the sale by agreeing to submit a minimum bid of almost HK$2.9 billion. The size of the site is 26,200 square metres. The auction will take place in mid-May. It follows successful auctions of sites in Tai Po. (Sources: RTHK)

· Authorities revealed that the growth of new loans supplied by commercial banks remained relatively rapid in March. The new loans supplied by Industrial and Commercial Bank of China, Agricultural Bank, Bank of China, Construction Bank had reached nearly 2,000 billion yuan in the first two weeks of March, which is slightly higher than the same period of last month. - The new loans supplied by the whole banking sector are estimated at about 800 billion to 1 trillion yuan in March. Taking into account the quarter-end performance evaluation of commercial banks and strong corporate credit demand, the impulse of banks to lend is still evident in March.(Source: China Security News)

· On 25 March, the governor of Central bank Zhou Xiaochuan said when attending annual meeting of Inter-American Development Bank, that some of the special incentives can be gradually faded out only if convinced of the economic recovery. The necessary conditions for implementing exit policies also include "make certain that W-shaped economic recovery won’t appear, that is slowdown in economic growth again after experiencing a rebound." - Taking a gradual implementation of exit policies is easier to communicate and can be understood easily by market participants. (Source: PBOC)

· The deputy director of National Development and Reform Commission Xu Xianping revealed that the relevant departments were coming up with a guidance to speed up the development of Yangtze River shipping, aiming at fostering regional economy of Yangtze River as new economic growth of Shanghai shipping economy to drive the economic development of inland rivers. -On A-share market, the listed companies related to transport of Yangtze River area include such 4 port corporations as Shanghai Port Group, Chongqing Gangjiu,Wuhu Port, Hong Kong, Nanjing Port, and Chang Jiang Shipping Group Phoenix whose business focuses on water transport on Yangtze River.(Source: NDRC)

· ICBC announced its intention to issue convertible bonds of not more than 25 billion yuan in A-share market to supplement the capital funds. After this financing, ICBC's capital adequacy ratio will be 12% or more, indicating that in principle it will no longer seek new financing through capital market in the next three years. - Re-financing is needed to further improve capital structure, raise capital quality, and to meet credit needs. However, now ICBC's capital adequacy ratio is still better than the national average, so the specific time of issuing the bonds is still to be selected.(Source: ICBC)


· Foreign investors remained net buyers of Thai shares for a 24th consecutive session worth Bt1,007b last Fri. (Source: Bisnews)

· The Finance Ministry is ready to raise Thailand’s GDP growth forecast for 2010 to at least 4% from a previous estimate of at least 3.5% but the figures were still below actual fundamentals as ongoing political chaos would drag growth down below 5%, a source at the ministry said. (Source: Post Today)

· Thai political update: (1) The government and core leaders of the United Front for Democracy against Dictatorship (UDD) will hold a second round of talks in a bid to defuse political tensions today after failure thrash out their differences over conditions leading to a house dissolution yesterday as the red shirts put forward a timeframe of 15 days for PM Abhisit Vejjajiva to dissolve the parliament; and (2) a series of explosions hit Bangkok with the latest bomb exploding near a residence of former PM and veteran politician Banharn Silapa-archa at Soi Charan Sanitwong 57 Sunday night. (Source: Krungthep Turakij)

· PM Abhisit Vejjajiva may decide to impose the International Security Act (ISA) in the resort town of Hua Hin to maintain law and order during the Mekong River Commission (MRC) Summit to be held from Apr 2-5, 2010. (Source: Bisnews)

· Finance Minister Korn Chatikavanji sent a signal of interest rate increases once the political situation returned to normal and the economy recovered. He also saw hot money flowing into stock markets but cited that the ongoing baht’s strength did not erode Thailand ’s export competitiveness as the currency appreciation was in line with currencies of its regional competitors. (Source: Krungthep Turakij)

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