China Growth Slows.
During recent talks on economic
conditions, Premier Wen Jiabao said China’s economic growth had started to
stabilize and witnessed positive changes with the economy running well in Q-3.
The country has made “stabilizing
growth” a top priority this year amid the economy’s downward pressure. The
government has quickened the process of export tax rebates for enterprises as
one of the measures to stabilize trade. It has also approved a raft of
investment projects to shore up growth.
The central bank has twice cut
the reserve requirement ratio for banks and lowered benchmark interest rates
this year.
Wall St Falls
Google Inc (NASDAQ:GOOG) reported
earnings today that were below estimates reflecting what the real global
economy looks like, forget QE3 and the manipulation of Wall St, things are not
good in Economic terms.
Google shares halted on NASDAQ
after slide, last down 9 percent.
Google Inc reported net revenue
of $11.3 billion for the third quarter, below Wall Street’s expectations.
The surprise announcement, which
had been expected after the market close, helped send its shares down 9 percent
to $688.
As Economist Shayne Heffernan of
www.livetradingnews.com said before this weeks trading, in addition to last
weeks note, we can add the issue of lower corporate earnings in the USA, while
QE3 mania lifted markets close five-year highs in September, reality is kicking
in and U.S. stock market investors are shifting their focus back to corporate
expectations, and that’s going to be unpleasant.
Westports
Westports Malaysia Sdn Bhd is
looking to raise as much as US$500mil (RM1.52bil) in an initial public offering
(IPO) in the second quarter of 2013, two sources with direct knowledge of the
plan said.
The funds raised from the IPO
will help Westports expand Port Klang, which has reported double-digit growth
in container handling over the last five years.
Westports, which counts Hutchison
Port Holdings and Malaysia’s state investor Khazanah Nasional Bhd as
shareholders, is launching an IPO at a time when privatisation schemes and
economic growth have cemented the country’s position as Asia’s top destination
for initial share sales.
“Although the roles of bankers
are not confirmed yet, Malayan Banking Bhd will likely lead the deal,” said one
of the sources yesterday, declining to be identified as the matter was still
private.
Credit Suisse Group AG and
Goldman Sachs Group Inc would also help arrange the sale, said the second
source.
Westports officials were not
immediately available to comment.
The IPO would follow the planned
US$1bil offering for independent power producer Malakoff Corp Bhd, 51%-owned by
MMC Corp Bhd, in the first quarter of next year.
The founders of Malaysia’s
AirAsia Bhd, Tan Sri Tony Fernandes and Datuk Kamarudin Meranun, are also set to
kick off an IPO spree in 2013 with three listings worth more than US$500mil.
Malaysia accounted for US$7.9bil
of the US$30.03bil worth of new listings in the Asia-Pacific region this year,
according to Thomson Reuters data.
By comparison, IPOs in Hong Kong
have raised US$1.81bil and those in Singapore US$3.44bil.
Headed by G. Gnanalingam,
Malaysia’s 24th-richest man according to Forbes, Westports helped move Port
Klang a notch higher to the 13th spot in the world port traffic league last
year, according to the Westports website.
CIMB Thai
CIMB Thai Group recorded a
consolidated net profit of 1.4 billion baht (about RM140 million) for the nine
months of this year.
President/chief executive officer
of CIMB Thai, Subhak Siwaraksa, said the figure represented an increase of
565.1 million baht (about RM56.5 million), or 66 per cent, from third quarter
of last year.
“This was mainly due to the
shared gains from Thai Asset Management Corp (TAMC) and a gain on sale of
investment in a CIMB Thai bank’s subsidiary,” he said, based on unaudited
consolidated financial results for the nine months ended Sept 30, 2012.
He said on a year-on-year basis,
consolidated income for CIMB Thai Group increased by 1.7 billion baht (about
RM170 million), or 38.1 per cent, from third quarter of last year to 6.4
billion baht (about RM640 million).
In a statement, he said, the
higher operating income was mainly due to higher net interest income, net fee
and service income, gains on trading and foreign exchange transactions and
other operating income.
On net interest income, a
year-on-year increase of 249.8 million baht (about RM24.9 million), or 7.1 per
cent, was recorded, largely underlined by loan expansion.
Subhak said net fee and service
income increased by 116.8 million baht (about RM11.6 million), or 25.5 per
cent, mainly due to the increase in corporate finance and mutual fund fees.
He said there was an increase of
1.4 billion baht in non-interest and fee income, which amounted to a
year-on-year increase of 205.4 per cent.
This was largely arose from the
shared gains from TAMC and gain on sale of investment in a CIMB Thai bank’s
subsidiary, he said.
As at Sept 30, total gross loans
stood at 127 billion baht (about RM12.7 billion), marking an increase of 6.2
per cent from end-December 2011 and it was largely underlined by retail
portfolio expansion.
Temasek
Singapore, one of Asia’s most
robust economies, is taking notice of the Philippines’ recent economic gains
and is looking to expand its investments in the Philippines, according to the
Department of Foreign Affairs.
A DFA statement said that
Singapore Foreign Minister K Shanmugam took note of the country’s rosy economic
performance in a meeting with Foreign Affairs Secretary Albert del Rosario, during
the latter’s official visit to the city state on October 11.
“The Philippines has been a quiet
economic story,” the DFA quoted Shanmugam as saying during the meeting.
The Singaporean foreign minister
called the Philippines’ economic achievements “fairly impressive” and that
Singaporean businessmen have started to take notice.
“He admitted that some
Singaporean investors experienced ups and downs in the country in the past, but
added that more are likely to come in once they see the Philippines on a steady
path,” the DFA said in a statement.
Singapore is the country’s
fifth-biggest investor, with some $357.74 million worth of investments into the
Philippines in 2011.
The city state is the
Philippines’ fourth-largest trading partner, with total trade volume amounting
to $9.17 billion. This accounts for 8.5 percent of the country’s total
international trade.
Del Rosario credited the
country’s economic performance, rated one of the best in Asia this year, to the
Aquino administration’s campaign for good governance, a reform initiative seen
as the key in improving investor confidence and easing business transactions in
general.
“I come with head held high,
proud of what is happening in my country,” Del Rosario told his Singaporean
counterpart.
The officials also talked about
moving bilateral air talks forward to further expand people traffic both ways
to boost both business and tourism ties, the DFA said.
There are already 167 weekly
flights connecting the Philippines and Singapore. Singapore tourist arrivals in
the Philippines have also increased by almost 50 percent between 2007 and 2011,
the DFA said.
The two diplomats also discussed
the establishment of a bilateral mechanism for regular discussions on areas of
cooperation.
Del Rosario also paid a courtesy
call on acting Prime Minister Teo Chee Hean, the DFA said.
Bank Danamon Indonesia
Bank Danamon Indonesia, the
country’s sixth largest lender by assets, had its profits rise more than 20
percent in the first nine months of this year from the same period last year.
This is due to Indonesia’s strong loan demand.
The company’s net income rose 22
percent to Rp 2.99 trillion ($311 million) in January to September this year
from Rp 2.45 trillion in the same period last year.
Danamon and Bank Tabungan
Pensiunan Nasional are part of only a few Indonesian companies that have
started to report their third quarter financial results. Other Indonesian
lenders such as Bank Mandiri and Bank Central Asia are due to report theirs in
the coming weeks.
The rise in net income at
Danamon, was “supported by loan growth in the mass market, small and
medium-sized companies and wholesale segments,” the lender said in the
statement.
Henry Ho, president director of
Bank Danamon, said that Indonesia’s loan growth and banking system remains
strong and was not affected by the impact of the global financial and European
debt crisis.
“Indonesia’s economy remains
relatively immune to the effects of the EU crisis, which has shown its adverse
impact to the global economy,” he said.
“The resilience of the Indonesian
economy allows for a conducive environment for the banking industry,
particularly for Danamon, which has maintained the positive performance
throughout the last nine months,” Henry added in the statement released in
Jakarta.
Outstanding loans at Danamon rose
16 percent to Rp 113 trillion at the end of Sept. this year from Rp 97 trillion
last year.
Lenders including Danamon, have benefited
from rising loan demand in Indonesia amidst low borrowing costs. Bank
Indonesia, the central bank, has kept its benchmark rate at a record low of
5.75 percent this month. They forecast lending by the country’s 119 commercial
banks to grow 24 percent this year.
The government forecasts that the
economy will expand by 6.5 percent this year, the same pace it recorded last
year.
Bank Danamon has been an
acquisition target by Singapore’s Temasek Holdings.
DBS Group Holdings announced in
April that it planned to acquire a 67.4 percent stake of Danamon from Temasek
Holdings, Singapore’s sovereign wealth fund. DBS would pay Rp 7,000 per share
for the stake via a stock swap that would result in Temasek owning 40 percent
of DBS’s enlarged capital, up from 29 percent currently but is still waiting
for approval from Bank Indonesia and the Monetary Authority of Singapore.
Yehey! Corp
Shares of Yehey! Corp. surged by
170 percent on the Internet solution firm’s stock trading debut Thursday,
lifted by rosy prospects for digital marketing and the upbeat global markets.
Within the next five years,
Yehey! can hit the P100-million sales mark as a growing number of companies
allot a bigger chunk of their advertising budget to the digital space, Edmundo
Bunyi Jr., president of parent firm Vantage Equities, said in a briefing.
In 2011, sales amounted to P34
million, which the company targets to exceed by 8 percent this year.
Although it listed by way of
introduction, or without an initial public offering, 33 percent of Yehey! is
now owned by the public.
Yehey! listed 278 million common
shares on the second board of the Philippine Stock Exchange at an initial price
of P1 per share, the same as the par value. Shares sizzled on the firm’s
listing day, hitting as high as P4.50 in intra-day trade before closing at
P2.70 per share. About P58.7 million worth of Yehey! shares changed hands on
the local bourse.
“Yehey! investors are establishing
what they think is a fair price,” said PNB Securities deputy chief Manny
Lisbona. “It also helps that overseas news is positive—such as China’s gross
domestic product growth falling within forecasts and positive US housing data.”
“We see a good future for the
business, especially coming from zero. There’s a bright future for it,” said
Wilson Sy, a director at Vantage.
Internet penetration rate in the
Philippines is estimated at about 33 percent, up from only 10-17 percent in
2004.
Sy, a stock market veteran, said
Yehey!’s strong debut could also be attributed to the bullish market sentiment
globally. With the global monetary easing bandwagon, he said “there’s so much
money going around.”
The local Internet firm is also
debuting at a time that the technology sector was making a strong comeback in
the global markets, long after the bursting of the dotcom bubble in early
2000s. Among the world’s most valuable companies now are technology firms such
as Apple and Microsoft.
Asked whether Vantage was keeping
Yehey! for the long haul or eventually getting a new investor, Sy said: “We’re
open to synergies. Digital marketing is just a small component of the big
advertising industry. We’re open to JVs (joint ventures) with big
marketing/advertising companies in the world.”
Of the P100-billion total
marketing budget spent on media, only 0.2 percent goes to digital marketing at
present, suggesting a huge room for growth, especially as some big regional
companies now set aside as much as 30 percent of their advertising budget for
the digital space.
About 80 percent of Yehey!’s
business comes from digital marketing while the rest comes from other media and
advertising services. For instance, Yehey! and SM have a tie-up in “proximity”
marketing that blasts brand campaigns to mall-goers over SM’s free WiFi in its
shopping malls.
Yesterday in Asia
Shanghai rose 1.24
percent, or 26.07 points, to 2,131.69 while Hong Kong added 0.48 percent, or
102.07 points, to 21,518.71.
Tokyo closed 2 percent
higher, adding 176.31 points to 8,982.86 as a weakening yen boosted exporters,
while Sydney gained 0.69 percent, adding 31.2 points to 4,559.4 and Seoul
advanced 0.20 percent, or 3.97 points, to 1,959.12.
China said its economy grew 7.4
percent in the third quarter to the end of September, easing for a seventh
straight quarter and underscoring its weakest performance since the global
financial crisis.
However, the figure matched
expectations, while other economic data pointed to a possible bottoming out of
the economy, which has been severely hit this year by troubles in its key
export markets of Europe and the United States.
Singapore closed up
0.48 percent, or 14.69 points, at 3,060.36.
Singapore Airlines gained 1.32
percent to Sg$10.75 and Jardine Cycle and Carriage added 2.03 percent to
Sg$52.23.
Taipei was flat, edging
1.01 points higher to 7,465.41.
Taiwan Semiconductor
Manufacturing Co. added 0.80 percent to Tw$88.1 while Hong Hai Precision was
0.11 percent higher at Tw$87.5.
Manila closed flat, dipping
2.44 points to 5,435.94.
Wellington closed 0.93
percent higher, adding 36.77 points to 4,001.95.
Telecom rose 0.8 percent to
NZ$2.46 and Fisher & Paykel Appliances gained 2.4 percent to NZ$1.27, while
Fletcher Building surged 3.27 percent to NZ$7.59.
Kuala Lumpur added 0.29
percent, or 4.75 points, to 1,665.42.
Hong Leong Bank rose 1.6 percent
to 14.20 ringgit while PPB Group added 2.1 percent to 12.46 ringgit. Malayan Banking
fell 1.8 percent to 9.11 ringgit.
Jakarta rose 0.45 percent,
or 19.44 points, to 4,356.97.
Hero supermarket rose 17.5
percent to 4,025 rupiah, car maker Astra added 3.1 percent to 8,200 rupiah and
Bank Rakyat Indonesia gained 1.3 percent to 7,800 rupiah.
Bangkok finished 0.76
percent higher, adding 9.93 points to 1,311.21.
Mumbai rose 0.97 percent,
or 181.16 points, to 18,791.93.
Tata Power rose 3.13 percent to
106.95 rupees while the largest commercial bank State Bank of India rose 2.8
percent to 2,276.65.
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