EQUITY UPDATE: 2 AUGUST 2012

ASIA

China’s Manufacturing PMI data declined to 50.1 in July vs 50.2 in June. Expectations came in at 50.30 but the data showed that there could be more room for rate cuts by the central bank to prop up the slowing economy. In related news, the HSBC PMI for China rose to 49.3 in July from 48.2 in June. (Bloomberg)

South Korea’s exports for July declined 8.8 percent on a y/y basis, steeper than the 3.6 percent declined forecasted. The effects of the euro crisis weighed heavily o nthe South Korean economy to affect trade and orders. In related news, the HSBC Markit PMI data for the manufacturing sector also declined to 47.20 in July vs 49.38 in June. The disappointing data points out to the central bank’s meet on 9 August where a rate cut could be expected. Inflation declined to 1.5 percent in July on a y.y basis vs exp. Rise of 2 percent. (Reuters)

China’s new home price index rose 0.3 percent in June on a m/m basis to RMB 8717 (USD 1369) a sq. meter based on observations from a 100 cities, its biggest rise since June 2011. Home price rise would alert the government which had placed several restrictions to prevent rampant price rise leading to a property bubble. Home sales rose 41 percent in June to RMB 531.3 b (USD 83 b) over May. (Bloomberg)

Indonesia’s CPI data for July rose to 4.56 percent on a y/y basis vs 4.53 percent in June. Expectations came in at a gain of 4.59 percent. Food price rise contributed to the rise in inflation, prompting for a rate cut by the central bank. Inspite of trade data revealing lower data, Bank Indonesia could resort to rate cuts to prop up the economy. In related news, exports declined 16.4 percent in June while imports rose 10.7 percent leading to a trade deficit of USD 1.32 b. (Bloomberg)

Lenovo Group Ltd – Co. will tie up with data storage device maker EMC Corp. to resell machines made by EMC and to boost storage equipment sales. The co. aims to target various corporate and SME’s giving EMC an access to the Chinese markets. Lenovo would hold a 51 percent stake in the joint operations. (Bloomberg)

INDIA

FII’s made gross purchases of INR 2014.83cr and sales of 1,573.38cr. DIIl’s made gross purchases of INR 813.64cr and gross sales of INR 986.61cr. (Business Standard)

According to Morgan Stanley research, India will continue face stagflation-type situation for few more months. The report cited loose government fiscal policies and rise in rural wage growth without a equivalent increase in productivity growth. (Economic Times)

India’s infrastructure sector output grew at 3.6 per cent in June vs. previous 4.0. The infrastructure output for eight sectors – coal, crude oil, oil refinery, natural gas, steel, cement, electricity and fertiliser – grew at 3.6 per cent in the April-June vs. previous 5.2 percent a year ago. (Economic Times/PTI)

State Bank of India – Co. slashed lending rated on car and home loans by up to 0.5 per cent. (Deccan Chronicles)

PVR Cinemas – Co. sold 10 per cent stake to private equity firm L Capital Asia for INR 108cr. (Economic Times/PTI)

Tulip Telecom – Co, won INR 87.23cr order from UIDAI. The project has a duration of three years and is extendable further. (Economic Times/PTI)

INDIAN EARNINGS

GlasoSmithKline Consumer Healthcare Ltd – Co. reported 2Q12 net profit at INR 106cr vs. previous 2Q11 at INR 82.46cr. Net sales at INR 729.73cr vs. previous INR 653.38cr. (Financial Express)

Ceat – Co. reported 1Q12-13 net profit at INR 29.01cr vs. previous 1Q11-12 net loss at INR 41.05cr. Total income from operations at INR 1,232.45cr vs. previous INR 1,114.37cr. (Business Standard/PTI)

EUROPE

Italian Manufacturing PMI data came in at 44.3 for July vs exp of 44.2 vs prev. data at 44.60. The data which came above expectations would not offer much respite to the nation which is affected by the crisis in the euro region. (Trading Economics)

U.K Factory output declined to 45.4 in July vs exp. 48.4 as exports declined vs 48.4 in June to suggest the deppening impact of the recession in the country and the euro area. (Bloomberg)

Vedanta – Fitch raised co.’s outlook to ‘positive’ from ‘stable’, affirming its Long-Term Foreign Currency Issuer Default Rating (FC IDR) at ‘BB+’. The rating agency also affirmed co.’s senior unsecured debt rating at ‘BB’. (MoneyControl)

NORTH AMERICA

The Fed held interest rates at 0.25 per cent versus estimated 0.25 per cent versus previous 0.25 per cent and is likely to maintain low levels for the federal funds rate at least through late 2014. In its monetary policy statement, it said that the US economic recovery had lost some momentum for the year. However no new monetary stimulus was offered, Fed to continue through the end of the year its program to extend the average maturity of its holdings of securities as announced in June. It also maintained its existing policy of reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities. (Reuters/FED)

The Institute of Supply Management’s index of manufacturing declined to 49.8 in July vs 49.7 in June vs expectations of 50.2 on lower orders leading to slight contraction in the data. Rising taxes, lower spending by the government, the ongoing eurozone crisis have weighed in on demand leading to lower out. New orders rose very marginally to 48 from 47.8 in June. Production index came in marginally higher at 51.3 vs 51 in June. (Bloomberg)

The U.S Dept of Treasury plans on introducing floating rate notes by the next year and also mulls on introducing negative interest rate bids. The Treasury is to auction USD 32 b of 3 yr notes, USD 24 b of 10 yr notes and USD 16 b of 30 yr bonds between August 7-9. (Bloomberg)

U.S ADP provided Nonfarm payrolls for July saw additions of 163k hirings vs a revised 172k hirings in June which suggested that the job market was staging a slight recovery in the year. Expectations came in at 120k hirings. The data would spur consumer spending which accounts for 70 percent of U.S’s GDP. Bigge co.’s employing more than 500 workers hired 23k workers while mid sized firms hired 67k positions while smaller firms added 73k workers.(Bloomberg)

Bain Capital Partners LLC – Co. will purchase a 40 percent stake in Genpact Ltd from General Atlantic LLC and Oak Hill Capital Partners. The stake purchase is expected to be at around USD 1.6 b. (Bloomberg)

Facebook Inc – Co. saw its share price decline to almost 4 percent in trade, taking the declines to the fourth consecutive session on concerns about its growth amid its second quarter results. Shares trade at USD 21.13 a share, a price which touched record lows from its IPO price of USD 38 a share. (Bloomberg)

 

 

 



Categories: General News

Tags: , , , , , , , , , , , , , , , , , , , , , , ,

Leave a Reply

Please log in using one of these methods to post your comment:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: