Wednesday, June 19, 7:22 AM
China's GDP growth forecast is cut to 7.4% by HSBC for both 2013 and 2014 from 8.2% and 8.4% previously. HSBC's view is now south of consensus as chief economist Qu Hongbin says reform measures - positive in the long-term - will actually be harmful to growth in the more immediate future. Shanghai (FXI, CAF) continues to slide, falling another 0.75% overnight.
1 Comment[Global & FX]
Tuesday, June 18, 8:54 AM
"The biggest contrarian play in the market today is assets linked to China (FXI, CAF)," says Michael Hartnett, summarizing BAML's latest Fund Manager Survey, which shows money flowing out of commodities (DBC) and emerging markets (EEM, DEM, VWO). Where's the money going? The eurozone and the U.S. Where it's not going is fixed-income (AGG, BND) - 50% of managers say they're now underweight bonds as opposed to 38% last month.
Comment!
Friday, June 7, 4:08 AMAsian markets fall as investors position themselves for weak U.S. payroll figures today and for Chinese economic data over the weekend. Japanese shares (NKY) enjoy another roller coaster day but end a mere -0.2%, while the dollar-yen is -0.4% as the Japanese currency continues to strengthen. In China, stocks (FXI, CAF) drop for a seventh day in a row amid fears about economic growth and tightening liquidity, while Hong Kong's (EWH) fall of -1.3% puts it in and around correction territory. India +0.5%.
1 Comment[Global & FX, Top Stories, On the Move]
Thursday, June 6, 7:38 AM
China (FXI, CAF) fell 1.3% overnight, its 6th consecutive decline - the worst losing streak in a year. Among the decliners was China Vanke (CVEKY.PK), sliding 2.9% as its chairman warned of a property (TAO) bubble in the country. "If the bubbles are not controlled, the result will be catastrophic."
Comment![Global & FX]
Sunday, June 2, 9:56 PM
China's HSBC PMI for May falls a bit more than the "flash" read tipped off 10 days ago, coming in at 49.2 from 50.4 (flash came in at 49.6). The downward revision "suggests a marginal weakening of activities toward the end of May, thanks to deteriorating domestic demand conditions," says HSBC. "Beijing needs to boost domestic demand." Reaction is muted: Shanghai (FXI, CAF) +0.2% and Hong Kong (EWH) +0.6% in early trade. The aussie (FXA) knee-jerks down a few pips, but is +0.4% on the session at $0.9618.
1 Comment[Breaking News]
Thursday, May 23, 3:17 AMChina PMI shrinks for the first time in seven months, dropping to 49.6 from 50.4 in April, missing expectations. HSBC, who collect the data, didn't mince words in an appeal to Beijing: "The cooling manufacturing activities in May reflected slower domestic demand and ongoing external headwinds. A sequential slowdown is likely in the middle of Q2, casting downside risk to China's fragile growth recovery. Moreover, the further signs of labor market slackness call for more policy support. Beijing still has fiscal ammunition to do so." ETFs: FXI, GXC, PGJ, YAO, FCHI, PEK, CAF, YXI, XPP, FXP, MCHI, YINN, YANG, TCHI, CHXF; BONDS: RMB, DSUM, CHLC, CNY, CYB, FXCH1 Comment[Global & FX]
Friday, May 17, 7:16 AM
Shanghai (FXI, CAF) completes its biggest week in 4 months, up 1.4% overnight as the government slashes red tape for certain investment projects. A total of 117 "approval items" - including gas fields, airports, and paper pulp - can now move forward without getting an "Ok" from Beijing.
Comment![Global & FX]
Tuesday, May 14, 10:42 AM
"Contrarians should start buying emerging markets (EEM, DEM, VWO) and think about global energy (XLE) and material companies (XLB) and commodities (DBC)," says BAML's John Bilton, noting a "marked uptick" in concern about China (FXI, CAF) in his firm's latest fund manger survey. One-in-four now consider a Chinese hard landing as the biggest risk to their investment. Where respondents are not fearful? Japan (EWJ, DXJ). (previous)
4 Comments[Global & FX, Commodities]
Tuesday, May 14, 7:39 AM
China's Q2 GDP growth forecast is cut to 7.8% from 8% at JPMorgan, which also reduces its full-year estimate to 7.6% from 7.8%. There's no indication the government's policy stance will be shifted quickly to support near-term growth, says the bank. Slash rates? Can't do it, says a state economist, thanks to an already abundant pool of global liquidity. Shanghai (FXI, CAF) fell 1.1% overnight.
1 Comment[Global & FX]
Monday, May 13, 7:11 AM
With new property curbs taking effect, China's home sales transaction value fell 13% in April. The fall, however, is from a very high level as the same metric though the first 4 months of 2013 is up 65% from a year ago. Shanghai (FXI, CAF) fell 0.2% overnight. The China Real Estate ETF (TAO) +37.5% Y/Y.
Comment![Global & FX]
Tuesday, May 7, 10:16 PM
What global slowdown? Chinese April exports rose 14.7% Y/Y vs. 8.6% expected. Imports gained 16.8% vs. 11.6% expected. The trade surplus clocked in at $18.16B. Bloomberg's Adam Johnson: "Imports AND exports better than forecast; 18 hours ago German factory orders better and U.S. job postings up ... Connect the dots." Shanghai (FXI, CAF) +0.7%, Hong Kong (EWH) +0.8%.
6 Comments[Global & FX]
Monday, April 29, 8:00 AM
Chinese industrial company profit growth slowed to 5.3% Y/Y in March, down from a 17.2% pace in the year's first two months. For the quarter as a whole, profits rose 12.1% - roughly inline with sales, meaning flat margins. "With problems of overcapacity and the sluggish global picture, it doesn't bode well," says RBS' chief China economist Louis Kuijs. Shanghai (FXI, CAF) closed overnight.
2 Comments[Global & FX]
Monday, April 22, 11:08 PM
China's flash HSBC PMI for April slides to 50.5, missing expectations by a full point and against March's read of 51.6. "New export orders contracted after a temporary rebound in March, suggesting external demand for China's exporters remain weak," says HSBC. "Weaker overall demand has also started to weigh on employment in the manufacturing sector." Shanghai (FXI, CAF) is off 1.5 in early trade. Hong Kong (EWH) -0.9%.
6 Comments[Global & FX]
Monday, April 22, 4:35 PM
Jim Chanos isn't backing off, laying out his bearish case on China in a new presentation entitled, China: The Edifice Complex. The arguments aren't new to anyone who's been following along: Property bubble, diminishing returns on the capital investment boom, and massive corruption at both the government and corporate levels. Priced in? China A Shares (CAF) fell years ago and they haven't gotten up.
4 Comments[Global & FX]
Friday, April 19, 9:18 AM
Shanghai posted its biggest gain in a month, +2.1% as regulators look to lure more money into stocks, mulling plans to allow A shares to be added to well-known international indexes, including the MSCI Emerging Markets Index (EEM, VWO). FXI +2.9%, Morgan Stanley China A Share Fund (CAF) +5% premarket.
1 Comment[Global & FX, On the Move]