Wednesday, August 26, 2009

China’s Sovereign wealth fund to increase overseas investment

Thu, Aug 27 2009, 00:28 GMT

According to a report over Reuters, the Chinese Investment Corporation, which manages about USD$200 billion of China's foreign reserves, will increase it's overseas investment by as much as 10-fold this year, as it sees the global economy recovering.

Australia Q2 Capex +3.3% Vs -5.0% expected

Thu, Aug 27 2009, 01:40 GMT

Capital expenditure in the second quarter in Australia was much bigger than anticipated. The government stimulus program and recovering international sentiment were the main causes of the resurgence. The AUD/USD has popped up 10 pips on the data.

CORRECT: Asian Shares Mostly Lower; Mkts Running Out Of Steam

Thu, Aug 27 2009, 01:49 GMT

CORRECT: Asian Shares Mostly Lower; Mkts Running Out Of Steam

("=Asian Shares Mostly Lower; Markets Running Out Of Steam," published at 0107 GMT misspelled the name of Mizuho Securities' senior technical analyst. A corrected version of the full story follows.)

By Matthew Allen


SINGAPORE (Dow Jones)--Asian stock markets were mostly lower Thursday, succumbing to some profit-taking after Wall Street's limp showing, though losses weren't too severe as positive economic data from the U.S. bolstered sentiment.

The Dow Jones Industrial Average inched higher to close up 0.04% after new home sales data and durable goods orders for July beat expectations.

Analysts said Wall Street's tepid reaction to the positive data showed that the markets' recent uptrend may be running out of steam.

"Signals from Wall Street are somewhat negative, because the market wasn't lifted by better-than-expected economic data," said Mizuho Securities senior technical analyst Yutaka Miura. "The U.S. market may be facing stronger resistance now," he added.

"It's good to see improving signs of U.S. housing markets, but they are not data that can ignite new hopes, but numbers that just confirmed previous expectations for the economic recovery," said Jung Seung-jae at Mirae Asset Securities in Seoul.

Japan's Nikkei was down 1.5%, Australia's S&P/ASX 20 was 0.6% lower, while South Korea's Kospi Composite lost 0.6%. New Zealand's NZX-50 was flat. DJIA futures were 19 points lower in screen trade.

Australian stocks were lower, on the back of Wednesday weakness in materials, industrial and financial stocks in the U.S. Resources stocks were accounting for nearly half the fall of Sydney's benchmark index.

As Australia's exports of raw materials such as iron ore are highly leveraged to Chinese demand, there was some concerns about Wednesday's comments from China's State Council that it will tighten the approval process for investment projects in traditional industries, in response to overcapacity.

Mining giants Rio Tinto and BHP Billiton were down 2.7% and 1.4%, respectively. Westpac bank was down 0.1% and National Australia Bank was up 0.1%.

In Japan, shipping, steel, and trading house stocks were particularly weak after leading the market's rally Wednesday.

JFE Holdings was down 1.4%. Nippon Yusen was down 1.5%. Mitsui O.S.K. Lines was 1.4% lower and Mitsui & Co. was down 2.0%.

The South Korean market was following Wall Street's lead and taking a break, with profit being booked in tech names and banks. "The Kospi is taking a breather, in line with the U.S. markets, which took a rest overnight," said Lee Kyung-soo at Taurus Investment & Securities. However, the market was expected to move in tandem with Chinese stocks later in the day, as has been the recent trading trend.

Shinhan Financial was down 1.8%. Samsung Electronics was 0.8% lower and Hyundai Motor was down 1.0% after recording historic highs earlier this week.

In New Zealand, stocks were trading on mixed earnings cues.

Chemicals maker Nuplex Industries surged 12% as investors cheered the company's fiscal year results.

Air New Zealand was down 2.4% after it posted sharply lower full-year net profits. The carrier's Chairman John Palmer said the airline market remains turbulent and while demand was stabilizing, margins remained under significant pressure.

Foreign exchange markets were shying away from the risk-sensitive euro as the Japanese stock market weakened. The single unit was at $1.4232, compared with $1.4245 late in New York Wednesday, it was buying Y133.72 compared with Y134.09. The dollar was buying Y93.90 from Y94.13.

Though higher-yielding currencies like the euro usually benefit from strong U.S. data, the dollar gained against the single currency in New York Wednesday after reports showed sales of new single-family homes in July increased by 9.6%, well above projections for a 1.6% gain.

"We stress again that it's still too early to say that the negative correlation between U.S. stocks and the dollar is over, but we think more and more days like Tuesday and Wednesday will be seen in the months ahead," said Brown Brothers Harriman in a note.

Base metals were slightly higher in early Asian trade after pulling back on the London Metal Exchange on Wednesday. The market was well supported as sentiment was improving along with economic data, though reports China State Council was seeing overcapacity and "blind investment" in some industries was adding some caution.

LME three-month copper was up $16 at $6,307 per ton after closing $19 lower in London. Three month aluminum was up $5 at $1,872 per ton.

Spot gold was down $1.85 at $943.65 per troy ounce. The October Nymex crude oil futures contract was 33 cents lower at $71.10 per barrel.

-Matthew Allen, Dow Jones Newswires; +65-6415-4140;

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DATA SNAP: Philippines 2Q GDP +1.5% On Yr; Mkt Expected +0.3%

Thu, Aug 27 2009, 02:24 GMT

DATA SNAP: Philippines 2Q GDP +1.5% On Yr; Mkt Expected +0.3%

MANILA (Dow Jones)--The Philippine economy rebounded in the second quarter after a contraction in the first quarter, dodging recession on the back of stronger consumer spending and the continued resilience of the services and farm sectors.

The National Statistical Coordination Board said Thursday gross domestic product in the April-June quarter rose 1.5% on year, slower than the 4.2% expansion in the same quarter last year but quicker than the revised 0.6% growth in the first quarter.

Second quarter GDP rose 2.4% from the first quarter, when domestic output contracted a revised 2.1% from the fourth quarter.

The Philippine economy's performance in the second quarter mirrors the improvement around the region, where rates of contractions in most countries hit hard by the global credit crisis last year have decelerated.

The government projected second quarter GDP within a range of a 0.1% contraction and a 0.9% growth. The median forecast of 11 economists polled by Dow Jones Newswires, meantime, placed second quarter growth at 0.3% on year and 1.2% on quarter.

In the six months to June, GDP was up 1.0% on year, still within the government's full-year target of growth between 0.8% and 1.8%.

The services sector grew 3.1% on year in the second quarter while the farm sector's output in the April-June period rose 0.3% on year, offsetting the 0.3% on year contraction in industries.

Also in the second quarter, consumer spending rose 2.2% on year after growth slowed to 0.8% in the first quarter. Government spending increased 9.1% on year in the second quarter due to pump-priming activities.

-By Rhea Sandique-Carlos and Cris Larano, Dow Jones Newswires; 632-848-5051;

Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: You can use this link on the day this article is published and the following day.

(END) Dow Jones Newswires

Sterling still consolidating

Thu, Aug 27 2009, 02:27 GMT (Buenos Aires) – GBP/USD Current Price: 1.6230. Consolidating under the daily ascendant trend line broken past Wednesday indicators point for some upside correction in the next hours, thus general bias remains strongly bearish in the pair.

Bigger time frames also seem exhausted to the downside, thus 1.6275 resistance level will likely hold and made pair retreat. “Under 1.6200, further upside movements will be deny for current session, and pair likely to retest the 1.6160 area,” said Valeria Bednarik, collaborator at

Support levels: 1.6200 1.6160 1.6110. Resistance levels: 1.6275 1.6310 1.6350.

GBP/USD (Aug 27 at 03:41 GMT)

1.6216/19 (-0.08%)

H 1.6245 L 1.6208

[?]Trend Index[?]OB/OS Index
Slightly BullishNeutral
Data updated on Aug 27 at 03:30 (15-minute timeframe)

[ View GBP/USD technical studies ]

EUR/USD Current Price: 1.4238

Thu, Aug 27 2009, 01:18 GMT (Buenos Aires) – EUR/USD Current Price: 1.4238. Rebound from 1.4200 yesterday’s low, has been halted at the strong static resistance level at 1.4250, and pair is slowly regaining the downside.

Capped by 200 EMA in the hourly, and with 20 SMA with a nice bearish slope that also favor the downside, current candle opened under a small ascendant channel forming a continuation figure.

Nikkei 225 open down 0.7% at 10,570.78, as optimism continues fading. “Watch for a confirmation under 1.4200 that would signal further midterm falls,” said Valeria Bednarik, collaborator at

Support levels: 1.4200 1.4160 1.4120. Resistance levels 1.4250 1.4280 1.4315.

AUD continues to recover intraday

Thu, Aug 27 2009, 02:37 GMT

The AUD/USD fell to a low of .8240 earlier but a combination of decent economic data and short term bears booking profits, succeeded in limiting losses and the pair has now popped back up towards it's opening level. The AUD is also making some modest gains against the NZD after nearly 15 consecutive days of losses. Most players feel that an AUD/NZD rate below 1.20 is probably hard to sustain in the current economic climate and the pair will now try and post consecutive daily lows at 1.2120.

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