German Chancellor Angela Merkel said Europe is in one of its deepest
crises, and while the path to a solution is “arduous,” the euro region will
emerge stronger.
She hosts French President
Francois Hollande as the leaders of Europe’s two biggest economies seek common
ground on Greece and the wider debt crisis. Greece’s prime minister, Antonis
Samaras, will follow Hollande to Berlin tomorrow and travel on to Paris on Aug.
25.
Stocks extended declines after
the European Union said it is focused on its aid program for Spain’s banks and
hasn’t received a request for a full bailout from the euro-area nation.
Earlier, German Finance Minister Wolfgang Schaeuble said that allowing Greece
more time to meet its debt obligations would not solve the country’s problems
and would increase costs for creditors.
Purchases of new U.S. homes rose
more than projected in July. Sales climbed 3.6 percent to a 372,000 annual
pace, compared with the median estimate of 365,000. A separate report showed
the number of applications for unemployment benefits climbed last week to a
one-month high, showing little progress in the labor market. Jobless claims
rose for a second week to reach 372,000. The median forecast called for
365,000.
A Chinese report today indicated
that manufacturing will contract at a faster pace in August, signaling the
country’s economy needs more stimulus to secure a rebound in growth. The
preliminary reading for a purchasing managers’ index for China was 47.8. If
confirmed, it would be the weakest level since November and the 10th month that
the reading has stayed below 50, the longest run in the index’s eight-year
history.
Thailand
Top five most active values were
as follows;
INTUCH stood at 69.50 baht, up
1.00 baht (1.46%)
ADVANC (XD) stood at 217.00 baht,
up 8.00 baht (3.83%)
PTT stood at 334.00 baht, down
5.00 baht (1.47%)
PTTEP stood at 150.00 baht, down
2.00 baht (1.32%)
THCOM stood at 18.20 baht, up
0.60 baht (3.41%)
Mr Kittiratt acknowledged that
his pledge earlier this year that exports would grow 15% this year was a “white
lie”. On Tuesday, the government officially cut its export target for 2012 to
9% growth.
The target is still higher than
forecast by many economists _ the national planning agency, the National
Economic and Social Development Board (NESDB), this week cut its export growth
forecast for the year to 7.3% from 15.1%.
Mr Kittiratt said export targets
represented “working goals” aimed at encouraging related parties to put their
best efforts forward.
But the admission that the
targets were known to be unrealistic from the start was criticised from some
quarters.
Korn Chatikavanij, a deputy
leader of the opposition Democrat Party, said he was incredulous to hear a
finance minister stating that intentionally deceiving the public was
acceptable.
“I cannot believe that such
statements [by Mr Kittiratt] will result in stronger confidence in the
economy,” said Mr Korn, who served as finance minister under the Abhisit
Vejjajiva government.
“Quite the contrary. This can
only cause confidence to decline.”
Mr Korn said exporters and
economists have long dismissed the possibility of 15% export growth this year,
given the weak state of the global economy and the impact on the domestic
supply chain from last year’s floods.
He noted that some forecasts have
exports growing by as little as 3% this year. For the first half of the year,
exports contracted by 2% from the same period last year.
“Personally, I cannot envision
any circumstance where the finance minister may lie to the public,” Mr Korn
said.
Singapore
The consumer price index rose 4
percent from a year earlier, the Department of Statistics said in a statement
today. The median estimate of 18 economists in a Bloomberg News survey was for
a 4.5 percent increase, after a 5.3 percent pace reported earlier for June. The
July core inflation rate was 2.4 percent.
Singapore trimmed its prediction
for 2012 expansion this month and said the island’s growth outlook “remains
cautious,” increasing pressure on the Monetary Authority of Singapore to join
central banks from China to the Philippines in adding stimulus. The island has
allowed the currency to strengthen to counter inflation and forecasts
consumer-price gains will average 4 percent to 4.5 percent this year.
“Ultimately, the balance of risk
has tilted toward growth and there is increasingly more scope for monetary
policy accommodation,” Irvin Seah, a Singapore-based economist at DBS Group
Holdings Ltd., said before the report. “Underlying inflationary pressure in the
economy is expected to remain high. If policy is aimed at targeting inflation,
growth will slow further.”
Malaysia
KLCI index lost 0.64 points or
0.04% on Thursday. The Finance Index increased 0.07% to 14859.14 points, the
Properties Index dropped 0.22% to 1059.23 points and the Plantation Index down
0.13% to 8649.31 points. The market traded within a range of 4.71 points
between an intra-day high of 1655.24 and a low of 1650.53 during the session.
Actively traded stocks include
INGENS-WA, INGENS, NEXTNAT, JCY, GPRO, MPAY, UTOPIA, MPAY-WA, MAYBANK and
ASUPREM. Trading volume decreased to 1192.71 mil shares worth RM1303.02 mil as
compared to Wednesday’s 1353.10 mil shares worth RM1622.63 mil.
Leading Movers were CIMB (+4 sen
to RM7.85), IOICORP (+2 sen to RM5.12), ARMADA (+10 sen to RM3.78), BAT (+48
sen to RM62.98) and TM (+2 sen to RM5.99). Lagging Movers were DIGI (-3 sen to
RM4.88), PETCHEM (-5 sen to RM6.50), PETDAG (-32 sen to RM22.68), PBBANK (-2
sen to RM14.38) and PPB (-10 sen to RM14.20). Market breadth was negative with
305 gainers as compared to 419 losers.
Indonesia
Leading Indonesian business
figure Chatib Basri says that investment in the country will grow 30 percent
next year from an estimated Rp 300 trillion ($31.6 billion) this year, as the
country’s middle class continues to attract corporate interest.
Chatib, chairman of the
government-backed Investment Coordinating Board (BKPM), said that Indonesia
would benefit from both “push” and “pull” factors in its efforts to achieve its
investment target of Rp 390 trillion in 2013.
“Even though the world economy,
in Europe in particular, is still unstable, we can benefit from a number of
factors that will enable us to achieve the investment target in 2013,” Chatib
said in Jakarta on Tuesday.
Among the push factors — those
from abroad — is the fact that Japan, Indonesia’s largest foreign investor, is
grappling with the yen’s surge against the US dollar, which is driving up the
costs of production in the North Asian nation.
As a result, Chatib said,
Japanese companies are looking to locate production facilities overseas.
“Indonesia is the fifth-largest
destination country for Japan, so many Japanese companies consider Indonesia a
potential market and a potential country for investment. If the appreciation of
yen continues, it will cause high production costs and many Japanese companies
will invest in Indonesia next year,” said Chatib, who was installed as the
chairman of the agency in June.
Among pull factors — those within
Indonesia — is the country’s burgeoning middle class, which is proving a
tempting market for foreign companies.
Philippines
The government posted a budget
deficit of P39.2 billion in July as expenses and revenues continued to grow by
a double-digit pace year-on-year.
According to the Bureau of
Treasury, this brought the deficit in the first seven months to P73.7
billion—about two-fifths of the P183.3 billion that the government intended to
spend on top of the budget in the first nine months.
Also, the seven-month deficit was
68.7 percent more than the P43.7 billion recorded in the same period of 2011.
From January to July, expenses reached P958 billion—71 percent of the program
for the first three quarters. Still, the figure was 15.1 percent higher
year-on-year.
Budget Secretary Florencio B.
Abad yesterday said disbursements were “definitely gaining momentum.” “We can
expect the continued acceleration of government spending in the coming months,
bolstered by increased activity in project implementation among departments and
agencies,” Abad said.
He said infrastructure spending
for January to July increased by over 60 percent year-on-year, while
maintenance and other operating expenditures rose by more than 30
percent.Revenue in the first seven months totaled P884.2 billion—76 percent of
the goal for the period but 12.1 percent higher than that of a year ago.In July
alone, expenditures reached P162.6 billion. It was 21.8 percent higher than the
P133.4 billion of the same month last year. Revenue also reached P123.3
billion, an increase of 15.3 percent from P107 billion.
Finance Secretary Cesar V.
Purisima said July was the fifth month this year that the Bureau of Internal
Revenue posted double-digit year-on-year gains for monthly collections, while
it is the Bureau of Customs’ fourth month. From January to July, the BIR
contributed P604.7 billion—76 percent of the nine-month target. It was also
13.7 percent higher year-on-year. The BoC chipped in P167.8 billion. It was 65
percent of the target, but 12 percent better than last year’s collection.
In Asia Yesterday
Tokyo closed up 0.51
percent, adding 46.38 points, to 9,178.12, as the yen remained firm against the
dollar, while Seoul finished 0.38 percent higher, or 7.35 points up, at
1,942.54.
Sydney rose 0.17 percent,
or 7.7 points, to close at 4,383.7, Hong Kong finished 1.23 percent, or 244.46
points, higher and Shanghai closed up 0.25 percent, adding 5.36 points, to
2,113.07
Dealers said Chinese shares were
affected positively by HSBC’s announcement that China’s manufacturing activity
weakened to a nine-month low in August. They suggested the data may force
Beijing into beefing up economic stimulus efforts.
The preliminary reading of the
HSBC purchasing managers’ index (PMI), which gauges manufacturing activity, hit
47.8 this month, the lowest since last November, the British banking giant said
in a statement.
Taipei edged up 0.11
percent, or 8.59 points, to 7,505.17.
Taiwan Semiconductor
Manufacturing Co. was 0.36 percent higher at Tw$82.7 while Hon Hai Precision
gained 1.16 percent at Tw$87.1.
Wellington rose 0.14
percent or 24.97 points to 3,658.38.
Fletcher Building was up 0.8
percent at NZ$6.37 after sharp losses Wednesday on poor annual earnings while
Telecom Corp., which reports Friday, fell 0.7 percent to NZ$2.755.
Manila closed 0.98 percent
higher, or 50.69 points, to 5,202.84.
Metropolitan Bank and Trust Co.
rose 3.10 percent to 93 pesos while BDO Unibank gained 0.67 percent to 59.75
pesos.
Singapore closed up
0.23 percent, or 6.90 points, to 3,056.37.
Olam International fell 1.46
percent to Sg$2.03 while DBS Group gained 0.48 percent to Sg$14.65.
Jakarta ended up 0.05
percent, or 2.15 points, at 4,162.66.
Aneka Tambang rose 2.44 percent
to 1,260 rupiah, Indosat gained 1.87 percent to 5,450 rupiah, while Astra
International lost 2.74 percent to 7,100 rupiah.
Bangkok added 0.28 percent
or 3.50 points to close at 1,237.64.
Supermarket MAKRO gained 5.22
percent to 363 baht, while PTT lost 1.47 percent to 334 baht.
Kuala Lumpur ended flat,
losing 0.64 points or 0.04 percent, to close at 1,651.61.
Plantation giant Sime Darby shed
0.10 percent to 9.79 ringgit, while telecommunications provider DiGi.com fell
0.61 percent to 4.88. Telekom Malaysia gained 0.34 percent to 5.99 ringgit.
Mumbai’s ended up 0.02
percent higher or 3.36 points at 17,850.22.
Reliance Industries, the
country’s largest private firm, fell 1.6 percent to 794.8 rupees, while
software outsourcer Infosys rose 1.73 percent to 2,471.5 rupees.
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