Friday, July 2, 2010

20100702 1027 Local & Global Economic News.

Malaysia: Export growth likely to slow down in May
Malaysia’s robust export growth so far this year is likely to slow in May following Europe's austerity measures and weaker demand from China. Exports could grow by 25.75%, according to a poll of economists, down from April's 26.6%. Imports are forecast to grow by an average of 32.19% while the trade balance could average 10.41%. (BT)

China: Manufacturing slows for second month, PMI shows
China’s manufacturing growth slowed more than economists forecast in June, adding to signs that the world’s fastest-growing major economy is cooling. The government’s Purchasing Managers’ Index declined for a second month, falling to 52.1 from 53.9 in May. The median forecast in a Bloomberg News survey of 12 economists was 53.2. (Bloomberg)

US: Construction spending in US falls for first time in 3 months
Construction spending in the US fell in May for the first time in three months as homebuilders cut back and work on factories and transportation structures decreased. The 0.2% drop was less than forecast and brought spending down to USD841.9bn, Commerce Department figures showed. The government revised the April increase down to 2.3%, less than previously estimated. (Bloomberg)

US: Manufacturing, claims point to slowdown
Reports on US manufacturing, employment and home sales pointed to slower growth in the second half of the year, just as government spending to stimulate the economy begins to wane. The Institute for Supply Management’s manufacturing gauge fell more than forecast to 56.2 last month from 59.7 in May. A reading greater than 50 points to expansion. (Bloomberg)

Growth worries undermine stocks, commodities
LONDON, July 1 (Reuters) - World stocks fell to three-week lows and commodity prices sagged after data showing China's rapid growth was losing steam added to worries about the strength of the global economic recovery.
"There's a bit of relief in the market that some of the worries about funding concerns in Europe may be overdone," said Nick Stamenkovic, strategist at RIA Capital Markets.

China economy cools as tightening bites; markets swoon
BEIJING, July 1 (Reuters) - The pace of Chinese manufacturing growth slowed in June as government steps to cool the property market and curb bank lending combined with a faltering global recovery to dampen sentiment.
Two indexes based on polls of purchasing executives released on Thursday fell, but they showed an expected moderation in the world's third-largest economy and not the precipitous drop that some investors have feared: both gauges remained above the threshold of 50 that demarcates expansion from contraction.

Japan business mood best in 2 yrs, outlook murky
TOKYO, July 1 (Reuters) - Big Japanese manufacturers turned optimistic for the first time in two years in the April-June quarter and forecast a rise in capital spending plans in a sign that a slow economic recovery is taking hold.
The Bank of Japan tankan of more than 11,000 companies also showed optimism among big manufacturers would grow further in the current quarter, although analysts said the report may not have accounted fully for a sharp drop in Japanese stocks between April and June and a rally in the yen to a two-month high against the dollar.

Moody's puts Spain top rating on review for cut
MADRID/NEW YORK, June 30 (Reuters) - Moody's Investors Service said on Wednesday it is reviewing Spain's ratings and may lower them by as much as two levels due to sliding growth expectations and mounting fiscal challenges.
The rating's agency, the only major agency that still maintains a top rating for Spain, said it was conducting a three-month review of the country's Aaa local and foreign currency government bond ratings.

China may use export taxes to cull own industries
CHENGDU, China, July 1 (Reuters) - China, which helped its heavy industry survive the financial crisis by lowering barriers to exports, is now considering hitting the same exports with a tax to discourage rampant production that uses too much energy.
Fan Jianping, a top government analyst, said China is likely to impose export taxes on steel and base metals and their products in the next five years and classify them as industries serving domestic consumption. The goal would be to limit production capacity and to cut energy use and carbon emissions.

LME stocks show demand, but summer downturn seen
LONDON, June 30 (Reuters) - London Metal Exchange stocks are falling while the share earmarked for delivery is rising, but these signs of strong demand for metals are having little impact on price as the market looks to a downturn ahead, analysts said.
The drop in overall inventories and rise in cancelled warrants -- material earmarked for delivery -- have long been factored into prices, analysts said on Wednesday.

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