Asia-Pacific

Man U investors can always vote with their feet

20 Sep 2011

The soccer club may list in Singapore with “stapled” securities that could entrench the Glazer family’s control. But though new investors may not get the voting power they’d like, that can be reflected in the price. If the idea sounds too tricksy, would-be backers can say no.

China’s taste for European loans leaves it exposed

20 Sep 2011

Borrowers tapping cheap dollars to beat tight credit at home have racked up $333 billion in foreign loans, as much as 60 percent from European banks. If Europe’s crisis forces those banks to turn tail, it could jeopardise a small, but important source of cheap liquidity.

China’s IPO delays could worsen capital crunch

20 Sep 2011

Two heavy equipment makers, Sany and XCMG, delayed plans to raise a combined $5 billion. That suggests another door closing for Chinese companies hit by slowing demand and tighter credit at home. For those facing cash shortages, weak global capital markets may be the last straw.

Mongolia’s bounty hunters must out-tough Genghis

16 Sep 2011

The windswept, agrarian Central Asian country might make global investors very rich if plans to develop its plentiful mineral wealth come off. But the land of Genghis Khan is still pretty wild. John Foley takes a look across the steppes at the opportunities and dangers.

Japan’s new funding plan is hopeful, yet remedial

16 Sep 2011

The new government’s plans to finance rebuilding by hiking taxes and selling stakes in companies like Japan Tobacco are welcome. But details of how the revenue will be raised are worryingly vague. Given the political hurdles ahead, Japan can’t afford to re-learn old lessons.

Ackman’s gamble on Hong Kong unlikely to pay

16 Sep 2011

The activist fund manager is betting Hong Kong will re-peg its currency higher against the dollar. That may make sense given divergent economies, but could hurt the city’s competitiveness and do little to combat inflation. Bets like Ackman’s only encourage authorities to dig in.

Euro-mess exposes Asia’s hot money soft spots

15 Sep 2011

A stampede for safety has sent many of Asia’s currencies diving and the cost of insuring its debt soaring. The retreat says less about Asia’s financial health than Europe’s. It’s a reminder that hot money is most dangerous not when it pours in, but when it pulls out.

China’s friendly blackmail of EU may do the trick

14 Sep 2011

Beijing has implied it will buy euro zone bonds if it is granted coveted “market economy” status. The balance of power is in China’s favour so there may be a temptation to say yes. But China isn’t a market economy. The better solution is for Europe to get its house in order.

China has too many graduates, not enough workers

13 Sep 2011

Supply of college graduates in China far exceeds demand. Blue collar workers are much less plentiful. Beijing is right to invest in human capital but university expansion has caused distortions in the job market. It needs to work on the imbalances created.

Jingdong IPO tests U.S. appetite for China stocks

8 Sep 2011

The Amazon lookalike, unknown outside China, hopes to raise up to $5 billion in a U.S. listing. Jingdong’s scale and growth speed are exciting. But rising doubts about Chinese Internet darlings will test demand. It is a bold bet in a tough market.

China’s hidden debt undermines its sermons

8 Sep 2011

The government’s stated debt is just 15 percent of GDP. But a gaping pension hole and heavy borrowing by state-backed entities could leave Beijing on the hook for debts closer to 130 percent of GDP. That makes China’s preaching over profligate American ways ring a bit hollow.

Stated numbers don’t tell China’s inflation story

8 Sep 2011

Consumer prices rose 6 percent in August, official statistics are likely to say. But like most Chinese data, that’s a guide not a fact. For savers, inflation probably feels higher. Depositors and politicians are worried. Investors cannot afford to be complacent.

Asian bonds offer new-style refuge in market panic

5 Sep 2011

If markets swoon anew, as negative economic signals suggests they might, Asian bonds and CDS both stand to gain ground. In the past, the two have moved in opposite directions. Their altered relationship offers a handy storm shelter for investors while it persists.

China small-stock boom puts big banks in the cold

2 Sep 2011

The likes of CICC and Goldman Sachs have dropped off China’s IPO league tables. A shift to second-tier stock markets favours nimbler and smaller underwriters. With Shenzhen’s boards raising twice what the main Shanghai exchange did this year, the big guys must adjust.

Japan’s LCD bailout puts state in reformist role

1 Sep 2011

Its big manufacturers have long placed job security over profits. So Tokyo has devised a face-saving way for Hitachi, Sony and Toshiba to spin off their ailing LCD units. A state-funded joint venture subsidizes R&D - and the social cost of consolidation that companies fear most.

Shadow banking in China needs restraint

1 Sep 2011

Banks in China may be lending hand over fist, but they’re not alone. Companies, ill-understood trusts and even individuals have pushed credit growth to more than double Beijing’s official target. Reining in this lending will be painful but it would be worse to let it run riot.

China’s new M&A rules may hurt its Internet stars

31 Aug 2011

A freshened regulatory framework adds clarity to the way China treats stock listings and takeovers. But mainland Internet firms which raise money overseas may have to change if they want to be listed at home, or even to secure their domestic operating licenses.

CCB sale underlines BofA’s slow road to recovery

30 Aug 2011

Offloading some $8 bln of the Chinese bank’s shares is a double boost to capital. Along with Buffett’s investment and future earnings, it should help put BofA back on track. But none offers a quick fix. Economic and mortgage woes will leave shareholders dangling for some time.

Temasek’s smart CCB trade may have strategic costs

30 Aug 2011

Singapore’s state investment fund is buying shares in China Construction Bank from Bank of America - at a valuation 21 pct below where it dumped the stock last month. That has financial logic. But it may look too clever for Beijing, and hurt Temasek’s access to deals in China.

South Korean equities offer bargains for optimists

30 Aug 2011

Its stocks dived 21 percent this month as leveraged bets soured. Now they look cheap. Big names such as Samsung Electronics trade below 10 times projected earnings. High debt will keep things volatile, but investors sanguine about global growth may want to revisit Seoul.