Wednesday, February 23, 2011

20110223 0920 Global Economic Related News.

China: Wages undermine bond investors as inflation accelerates
China, the biggest brake on global inflation for two decades, is embracing wage increases that threaten to erode retailers’ margins and demand for bonds. Premier Wen Jiabao convenes the annual National People’s Congress March 5, where delegates will approve a five-year plan designed to elevate the role of domestic demand. Part of that strategy is endorsing higher pay, with all 31 Chinese provinces and regions likely to boost their minimum wages in 2011 for the second consecutive year, according to Credit Suisse Group AG.(Bloomberg)

Japan: Moody’s ignored as local investors snap up bonds
Japanese investors ignored another warning by a ratings company about the nation’s ballooning debt, buying bonds and sending yields back toward the level before the nation’s credit ranking was cut just a month ago. Government bond futures climbed the most in two months even after Moody’s Investors Service cut its outlook on the country’s credit rating, while costs increased to insure Japanese bonds against default. The divergence in market moves highlights a gap in perceptions between locals, who own about 95% of outstanding government notes, and overseas investors.(Bloomberg)

EU: Merkel says EU weighing extension of Greek aid program
German Chancellor Angela Merkel signaled that European Union leaders may be ready to renegotiate the terms of Greece’s bailout as part of a broader package to shore up confidence in the euro. The comments by Merkel, the leader of Europe’s biggest economy, are the first indication the EU may respond to calls to ease bailout conditions for indebted countries.(Bloomberg)

US: Confidence increases to three-year high
Confidence among US consumers rose in February to a three-year high exceeding forecasts as more Americans predicted the economy and their incomes will grow. The Conference Board’s sentiment index increased to 70.4, the highest level since February 2008, from 64.8 the prior month, according to figures today from the New York-based private research group. Another report showed home values dropped by the most in a year.(Bloomberg)

US: Home prices in 20 cities fall 2.4% from year earlier
Residential real-estate prices dropped in the 12 months to December by the most in a year, a sign the US housing market is struggling even as the rest of the economy recovers. The S&P/Case-Shiller index of home values in 20 cities fell 2.4%, the biggest year-over-year decrease since December 2009, the group said today in New York. The median forecast of economists surveyed by Bloomberg News projected a 2.3% decrease.(Bloomberg)

20110223 0919 Malaysia Corporate Related News.

Moammar Gaddafi clings to power in Libya, protests continue
Moammar Gaddafi on Tuesday defiantly rejected opposition demands that he give up power, vowing that he would never leave the North African nation he has ruled for more than four decades and would die a "martyr". He spoke after leaders of a popular revolt seized control in some areas of Libya and top officials resigned to protest attacks by security forces that have killed more than 230 civilians. (The Washington Post)

Global unrest puts US stock market in a dive
The US stock market plummeted Tuesday in its biggest drop of the year as escalating tensions in the Middle East and North Africa sent oil prices soaring. The Dow tumbled 178.46 points, or 1.4%, to 12212.79. The S&P index fell 27.57, or 2.1%, to 1315.44. (The Wall Street Journal)

TM & Celcom Axiata collaborate on fixed and mobile convergence solutions
TM signed a MoU with Celcom Axiata for collaboration in providing complete fixed and mobile solutions to Malaysian consumers. TM group CEO Datuk Seri Zamzamzairani Mohd Isa said the MoU encompasses several areas of collaboration, specifically High Speed Broadband (HSBB) services, which comprise HSBB Access and HSBB Transmission. (Bernama) Please see accompanying report Total vehicle sales up 8.0% in January Total vehicle sales in January increased 8.0% to 54,696 units from 50,622 units recorded last year, said the Malaysian Automotive Association. Of the total, passenger vehicle sales rose 7.9% to 49,589 units, amid the rush delivery for Chinese New Year compared with 45,973 units sold in the same month last year. (Bernama)

Malaysia's first solar power plant
TNB has completed the pre-qualification tender process for Malaysia's first solar power plant to be located in Putrajaya. The utility will “very soon” call for tenders for the project that is estimated to cost some RM60m, according to TNB president and CEO Datuk Seri Che Khalib Mohamad Noh. (StarBiz)

MAHB a step closer to venturing into China
MAHB has reached another milestone in its quest to enter China with the signing of a joint cooperation agreement (JCA) with Nagamas Enterprise Hong Kong Ltd. The JCA will allow MAHB to help Nagamas Enterprise, a unit of Malaysia's Nagamas International, develop and expand a small airport in Yongzhou City in Hunan province. (BT)

2010 tourist arrivals hit record 24.6m
Tourist arrivals to Malaysia reached a new high of 24.6m last year, or 3.9% more, the highest ever for the sixth straight year. Tourism receipts rose by 5.8% to stand at RM56.5bn for 2010. In 2009, arrivals were recorded at 23.6m. (BT)

20110223 0914 Global Market Related News.

ECB policymakers ratchet up inflation warnings
HONG KONG/FRANKFURT, Feb 21 (Reuters) - ECB policymakers sent a fresh round of inflation warnings on Monday, as euro-zone data showed the region's economic recovery remained robust and likely to keep upward pressure on prices.
ECB policymakers have sounded increasingly aggressive on inflation this year since it topped the bank's target of just under two percent.

Yuan convertibility may quicken - PBOC official
HONG KONG, Feb 22 (Reuters) - The pace of the yuan's convertibility may accelerate as global demand grows for trade settlement in the Chinese currency, a Chinese central bank official said.
"If you look at the history and the progress of international use of our renminbi (yuan), you find that sometimes demand grows very quickly," said Xing Yujing, deputy director general of the monetary policy department of the People's Bank of China.

PRECIOUS-Gold eases from 7-wk peak, Middle East in focus
LONDON, Feb 22 (Reuters) - Gold fell on Tuesday following six days of gains, as a rising dollar outweighed safe-haven demand arising from violence in the Middle East, and silver was set for its largest slide in a month.
Deadly protests in Libya pushed oil prices to 2-1/2 year highs, fanning fears of inflation and undermining investor confidence in the global economic outlook.

FOREX-Euro down, 'safe-haven' FX rallies on Libya
LONDON, Feb 22 (Reuters) - The euro fell on Tuesday while the dollar rallied broadly after escalating political tension in Libya prompted selling in higher-yielding assets for the safety of the U.S. currency and also the Swiss franc.
The New Zealand dollar hit a near two-month low against its U.S. counterpart on speculation that the economic damage caused by an earthquake which rocked the country's second biggest city may increase the chance of an interest rate cut.

Oil surge prompts stock sell-off, dollar rally
LONDON, Feb 22 (Reuters) - World stocks fell nearly 1 percent as revolt in Libya drove oil prices sharply higher, prompting fears of disruption to global economic growth.
"Investors are scaling down on exposure across the board," said Richard Falkenhall, currency strategist at SEB in Stockholm. "Libya is the first major oil exporting country to be affected ... if this spreads to other oil exporting countries, it will not be a good sign."

20110223 0913 Soy Oil & Palm Oil Related News.

CBOT soybean products end sharply lower, tracking limit-down soybeans, on worries about Mideast unrest and global commodity demand. Soybeans and other commodities tumbled amid growing violence in the region, which propelled crude futures and fueled worries about commodity demand. March CBOT soyoil down 4.4% to 53.99c/pound while March soymeal slid 4.3% to $346.50/short ton. Both contracts fell to their lowest level in two months. (Source: CME)

Palm up on bullish commodity markets, but slow demand weighs
KUALA LUMPUR, Feb 22 (Reuters) - Malaysian palm oil rose 0.4 percent with traders taking positions on Libyan unrest that boosted most commodity markets, but the upside was capped by concerns of slower demand.
"Investors are fed up with the high palm oil prices, which are now a $60 premium over soyoil. It could slow down overseas demand, especially if riots in the Middle East continue," said a trader in Kuala Lumpur.

Indonesia to keep Feb export tax for palm, cocoa steady
JAKARTA, Feb 22 (Reuters) - Indonesia may keep its palm oil and cocoa bean export tax for March unchanged from February at 25 percent and 10 percent respectively, a source at the industry ministry said on Tuesday.
The base export price for crude palm oil (CPO), which is used to calculate export tax, may be set at $1,222 a tonne, up from $1,194 a tonne in February, the source said.

Patchy rain shores up Argentine soy-weather expert
BUENOS AIRES, Feb 21 (Reuters) - Scattered rains in Argentina have helped shore up the country's 2010/11 soy outlook, despite earlier dryness caused by the La Nina weather phenomenon, a specialist in crop weather said on Monday.
Argentina is the world's No. 1 exporter of soyoil and soymeal and its No. 3 soybean supplier.

Brazil soy harvest to get break from rain
SAO PAULO, Feb 21 (Reuters) - Rains that have been blanketing Brazil's grain belt are breaking up over the main harvesting regions in the south and center-west this week, local forecaster Somar said on Monday.
Brazil's is heading for a bumper soy harvest that is beginning to spread and should peak in March and April. Analysts have been raising forecasts and are seeing the current crop surpassing the record 69 million tonne crop of 2009/10.

Pakistan unlikely to cut vegoil import duties, flat demand seen
KUALA LUMPUR, Feb 22 (Reuters) - Pakistan, the world's No.4 vegetable oil buyer, will not cut import duties on palm oil and soyoil despite escalating food costs as the government needs to grow revenues, a key industry official said on Tuesday.
Higher prices of vegetable oils and the government's reluctance to lower tariffs will keep 2011 imports flat at 1.93 million tonnes from a year ago said Ikram Chaudhary, Secretary of the Pakistan Edible Oil Refiners Association.

Palm oil output to jump nearly 25 pct in 2011 -Bakrie Sumatera
JAKARTA, Feb 22 (Reuters) - Palm oil output at Bakrie Sumatera  will jump by nearly 25 percent this year, while its plantation estates will expand by an additional 5,000 hectares, the company said on Tuesday.
The strong production rise is due to some plantations coming into peak yield, Ambono Janurianto, president director at the planter, told Reuters on Tuesday, while acreage will increase from the company's own landbank.