https://www.scmp.com/rss/317892/feed Nick Edwards is a financial journalist with 25 years' experience in international real-time news, video-on-demand TV and print. Most of his career has been spent covering Asia's growing influence on the global economy, investment markets, international business and financial policymaking. en https://assets.i-scmp.com/static/img/icons/scmp-meta-1200x630.png https://www.scmp.com Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen. Here’s a summary of market action today, with analyst views:  Shanghai finishes... https://www.scmp.com/business/companies/article/1857721/china-markets-live-shenzhen-shares-end-poorly-shanghai-trims?utm_source=rss_feed https://www.scmp.com/business/companies/article/1857721/china-markets-live-shenzhen-shares-end-poorly-shanghai-trims?utm_source=rss_feed Sun, 13 Sep 2015 23:30:30 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen. Here’s a summary of market action Friday and yesterday, with... https://www.scmp.com/business/companies/article/1857153/china-markets-live-shanghai-and-shenzhen-shares-finish-minimally?utm_source=rss_feed https://www.scmp.com/business/companies/article/1857153/china-markets-live-shanghai-and-shenzhen-shares-finish-minimally?utm_source=rss_feed Fri, 11 Sep 2015 00:15:15 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen. Here’s a summary of market action Thursday, with analyst views:  Shanghai and... https://www.scmp.com/business/companies/article/1856863/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed https://www.scmp.com/business/companies/article/1856863/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed Thu, 10 Sep 2015 00:00:30 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen. Here’s a summary of market action Wednesday, with analyst views:  Shanghai and... https://www.scmp.com/business/companies/article/1856555/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed https://www.scmp.com/business/companies/article/1856555/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed Wed, 09 Sep 2015 00:00:30 +0000 A record US$93.6 billion fall in China’s foreign exchange reserves to US$3.56 trillion in the same month that the yuan was devalued and another US$1 trillion was wiped off the face value of mainland stock prices has led many to the conclusion that capital is fleeing the country as fast as it can. While money may well be flowing out of China, capital outflow and capital flight are two very different things. Especially in the mainland context where capital controls remain very firmly in place,... https://www.scmp.com/business/money/article/1856318/chinas-falling-fx-reserves-do-not-prove-case-capital-flight?utm_source=rss_feed https://www.scmp.com/business/money/article/1856318/chinas-falling-fx-reserves-do-not-prove-case-capital-flight?utm_source=rss_feed Tue, 08 Sep 2015 09:20:37 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen. Here’s a summary of market action Monday and today, with... https://www.scmp.com/business/companies/article/1856190/china-markets-live-shanghai-and-shenzhen-shares-finish-strong?utm_source=rss_feed https://www.scmp.com/business/companies/article/1856190/china-markets-live-shanghai-and-shenzhen-shares-finish-strong?utm_source=rss_feed Tue, 08 Sep 2015 00:00:15 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen. Here’s a summary of market action Friday and today, with... https://www.scmp.com/business/companies/article/1855900/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed https://www.scmp.com/business/companies/article/1855900/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed Mon, 07 Sep 2015 00:00:00 +0000 Some 25 US-listed mainland firms have had privatisation offers so far this year, with 22 of them announced before the end of June as the Shanghai and Shenzhen stock markets were imploding. The phenomenon has been driven by a significant underperformance of US-listed mainland firms, versus their A-share listed peers. Nowhere is this pattern more striking than in the technology and internet arena. While the buyout trend has lifted the price of mainland stocks listed in the US, they remain far... https://www.scmp.com/business/money/article/1855414/chart-day-china-tech-valuations-still-full-stretch?utm_source=rss_feed https://www.scmp.com/business/money/article/1855414/chart-day-china-tech-valuations-still-full-stretch?utm_source=rss_feed Fri, 04 Sep 2015 14:42:03 +0000 New data showing a surge in the debt run up by regional and local governments (RLGs) in the mainland is worrying ratings agency Moody's. "The credit-negative rise in debt leaves RLGs more exposed to the effects of China's slowing economy and the related weakening in revenues, against the backdrop of falling land sales," is the typically clinical way the agency describes it in a new report. Less clinically, RLG debt surged by more than a third between June 2013 and December 2014, the two official... https://www.scmp.com/business/money/article/1855100/chart-day-chinas-debt-woes-worsen?utm_source=rss_feed https://www.scmp.com/business/money/article/1855100/chart-day-chinas-debt-woes-worsen?utm_source=rss_feed Thu, 03 Sep 2015 13:45:15 +0000 China cannot possibly deliver the stability it craves for its equity markets, but that does not necessarily threaten the trajectory of the country's economic reforms or its credit ratings, Fitch's sovereign ratings chief told the South China Morning Post. "It may be beyond the reach of policymakers to control equity markets. It's as simple as that," James McCormack, global head of sovereign and supranational ratings, said in an interview on the sidelines of a conference in Hong Kong. "They are... https://www.scmp.com/business/china-business/article/1854742/china-credit-ratings-unharmed-market-volatility-fitch-says?utm_source=rss_feed https://www.scmp.com/business/china-business/article/1854742/china-credit-ratings-unharmed-market-volatility-fitch-says?utm_source=rss_feed Wed, 02 Sep 2015 11:26:06 +0000 Flick through the presentation slides Tidjane Thiam and his team ran through with investors when the newly installed Credit Suisse chief executive unveiled second-quarter earnings and it quickly becomes apparent why his first trip two weeks later is to Asia - it is his golden goose and he makes no bones about it. "What I've made my name in and what I believe in is global wealth creation in emerging markets," Thiam told the South China Morning Post. "I used to sell insurance, so selling wealth... https://www.scmp.com/business/companies/article/1853479/why-asia-matters-so-much-new-boss-credit-suisse?utm_source=rss_feed https://www.scmp.com/business/companies/article/1853479/why-asia-matters-so-much-new-boss-credit-suisse?utm_source=rss_feed Fri, 28 Aug 2015 11:45:45 +0000 China's stock market volatility does not pose a major risk to Australia's economy or undermine a landmark free-trade deal struck with Beijing that remains on target to be ratified by Canberra before the end of the year, Australian Minister for Trade and Investment Andrew Robb said yesterday. "People have been saying now for months - major commentators - that there will be a correction in China. Well now there's a correction and everyone's flapping around as though the world has stopped," Robb... https://www.scmp.com/news/china/diplomacy-defence/article/1852919/australia-confident-trade-china-despite-market-woes?utm_source=rss_feed https://www.scmp.com/news/china/diplomacy-defence/article/1852919/australia-confident-trade-china-despite-market-woes?utm_source=rss_feed Wed, 26 Aug 2015 18:38:55 +0000 Beijing cut interest rates and eased bank lending limits yesterday in a bid to stop panic selling in mainland stock markets that smashed them to eight-month lows, even as equities elsewhere in the world began to recover from the previous day's rout which investors termed "China's Black Monday". The move came as Premier Li Keqiang said there was no basis for continued depreciation of the yuan. He added that the yuan would "stay at a reasonable and balanced level". China stock index futures traded... https://www.scmp.com/news/china/economy/article/1852454/china-cuts-interest-rates-fifth-time-november-new-effort-boost?utm_source=rss_feed https://www.scmp.com/news/china/economy/article/1852454/china-cuts-interest-rates-fifth-time-november-new-effort-boost?utm_source=rss_feed Tue, 25 Aug 2015 10:30:15 +0000 SCMP Group, publisher of the South China Morning Post, reported net profits of HK$208.7 million for the first six months of the year, with valuation gains on investment properties and a partial asset sale boosting earnings from normal operations, the company said in a filing to the Hong Kong stock exchange. Profits excluding these gains were a more muted HK$28.3 million versus HK$48.2 million in the same period a year ago, as a lacklustre Hong Kong economy weighed down by weak retail spending -... https://www.scmp.com/business/companies/article/1852269/scmp-h1-profits-exceptional-gains-eyes-digital-strategy-offset?utm_source=rss_feed https://www.scmp.com/business/companies/article/1852269/scmp-h1-profits-exceptional-gains-eyes-digital-strategy-offset?utm_source=rss_feed Mon, 24 Aug 2015 17:00:00 +0000 A common question investors are asking about Beijing's recent policy support efforts is "why have they not worked?" The rebound engineered in 2009 is etched in many minds. Economists at UBS point out that policy support today is designed to be just that - support, not stimulus. And that is because many of the policy challenges Beijing faces today have their origins in the actions taken in 2008, including the massive run-up in leverage. "Back then, China's overall and government debt levels were... https://www.scmp.com/business/money/article/1850312/chart-day-why-chinas-economic-stimulus-isnt-working?utm_source=rss_feed https://www.scmp.com/business/money/article/1850312/chart-day-why-chinas-economic-stimulus-isnt-working?utm_source=rss_feed Mon, 17 Aug 2015 15:30:00 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen.   4:11pm: Hong Kong stocks were able to recover some of their lost ground in... https://www.scmp.com/news/china/economy/article/1850092/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed https://www.scmp.com/news/china/economy/article/1850092/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed Mon, 17 Aug 2015 00:00:30 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen.   4:07pm: The Hang Seng Index closes at 23,991.03, down 0.12 per cent or 27.77... https://www.scmp.com/news/china/economy/article/1849407/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed https://www.scmp.com/news/china/economy/article/1849407/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed Thu, 13 Aug 2015 23:45:15 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen.   4:10pm: The Hang Seng Index stays within a 300-point trading band for the day,... https://www.scmp.com/news/china/economy/article/1849121/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed https://www.scmp.com/news/china/economy/article/1849121/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed Wed, 12 Aug 2015 23:45:30 +0000 Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity. Investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen.   4:08pm: The Hang Seng Index stays below 24,000, closing on 23,916.02, down... https://www.scmp.com/news/china/economy/article/1848818/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed https://www.scmp.com/news/china/economy/article/1848818/china-markets-live-early-calls-price-forecasts-and-analyst-views?utm_source=rss_feed Tue, 11 Aug 2015 23:45:45 +0000 China owes its stock market boom and bust to the one thing that is crushing the competitiveness of every part of the world's second biggest economy - debt. The nation's debt mountain is widely estimated to top 250 per cent of gross domestic product, roughly equivalent to US$26 trillion, and is unlikely to peak before 2018. Its rate of growth since the start of the global financial crisis in 2007 has been exceeded only by the euro zone countries that have required international bailouts to stave... https://www.scmp.com/business/markets/article/1843775/us26-trillion-debt-problem-crushing-competitiveness-china?utm_source=rss_feed https://www.scmp.com/business/markets/article/1843775/us26-trillion-debt-problem-crushing-competitiveness-china?utm_source=rss_feed Sun, 26 Jul 2015 07:30:30 +0000 In the 45 years that Jim Rothenberg spent as an investor with one of the world’s most consistent fund management firms, there was one key constant – periods of intense volatility and major market gyrations. Speaking to the South China Morning Post just as mainland equity markets were engulfed in their worst volatility storm in seven years, the chairman of the US$1.4 trillion Capital Group of Companies took a typically long-term view of developments and remained focused on the key thing that has... https://www.scmp.com/business/markets/article/1842800/china-stock-volatility-argues-more-market-reforms-capitals?utm_source=rss_feed https://www.scmp.com/business/markets/article/1842800/china-stock-volatility-argues-more-market-reforms-capitals?utm_source=rss_feed Wed, 22 Jul 2015 09:15:15 +0000 The mainland’s US$3.9 trillion stock market unwind could be barely halfway through, with a key price-to-earnings ratio still running at roughly twice the level analysts say is fair value and some US$600 billion worth of margin debt and collateral pledges left to clear. Opaque off-balance-sheet lending has left money managers and financial analysts groping for reliable figures on which to base estimates of further downside risk, even as mainland stock markets enter a second week of relative calm... https://www.scmp.com/business/markets/article/1841816/leverage-overhang-leaves-mainland-china-stocks-exposed-fresh-falls?utm_source=rss_feed https://www.scmp.com/business/markets/article/1841816/leverage-overhang-leaves-mainland-china-stocks-exposed-fresh-falls?utm_source=rss_feed Mon, 20 Jul 2015 10:34:42 +0000 China's bid to play a bigger role in the management of the global financial system has been in train since it helped draw up the rules that created the International Monetary Fund in 1944, according to a report published today by OMFIF, the network linking central banks and sovereign wealth funds around the world. The report throws new light on the original discussions that set voting power quotas at the IMF and China's key role in them, striking many parallels with Beijing's current efforts to... https://www.scmp.com/news/china/economy/article/1841385/chinas-imf-ambitions-revealed-new-archive-report?utm_source=rss_feed https://www.scmp.com/news/china/economy/article/1841385/chinas-imf-ambitions-revealed-new-archive-report?utm_source=rss_feed Sun, 19 Jul 2015 20:15:45 +0000 Clement Kwok King Man has had a busy 12 months. In that time, the Hongkong and Shanghai Hotels chief executive has opened a new Peninsula hotel in Paris, signed a €300 million (HK$2.55 billion) deal to develop one in Istanbul and submitted a planning application for a landmark site in London. That is a breakneck pace for an executive charged with the stewardship of a 150-year-old hotel brand that positions itself as being as much a builder of history as it is a purveyor of some of the planet's... https://www.scmp.com/business/companies/article/1840955/how-peninsula-hotels-make-profits-past?utm_source=rss_feed https://www.scmp.com/business/companies/article/1840955/how-peninsula-hotels-make-profits-past?utm_source=rss_feed Fri, 17 Jul 2015 14:00:45 +0000 The fall in Chinese stock prices has pushed Hong Kong-listed mainland firms back into the Credit Suisse "Cheapest Four" trading basket. Being overweight, the components of the Cheapest Four basket have outperformed the MSCI Asia Ex-Japan Index by 1.9 per cent in the year to date. The Expensive Four basket, meanwhile, has underperformed the index by 1.3 per cent. The model has been running since 2000 and the cheapest four have outperformed 87 per cent of the time over 12 months. The cheapest four... https://www.scmp.com/business/article/1839930/chart-day-china-falls-drag-hong-kong-stocks-back-among-asias-cheapest?utm_source=rss_feed https://www.scmp.com/business/article/1839930/chart-day-china-falls-drag-hong-kong-stocks-back-among-asias-cheapest?utm_source=rss_feed Wed, 15 Jul 2015 13:45:45 +0000 Four weeks after the start of the deepest rout in Chinese shares in seven years that has delivered a US$3 trillion-plus discount to previously quoted prices, just 24 of the 2,723 stocks that make up the Shanghai and Shenzhen benchmark stock indices are worth buying. That is at least according to new research from BNP Paribas Asia-Pacific equity strategist Manishi Raychaudhuri, who has screened the universe of available shares and filtered them by various criteria including price resilience,... https://www.scmp.com/business/companies/article/1838600/after-us3-trillion-crash-discount-bnp-says-just-24-china-stocks?utm_source=rss_feed https://www.scmp.com/business/companies/article/1838600/after-us3-trillion-crash-discount-bnp-says-just-24-china-stocks?utm_source=rss_feed Tue, 14 Jul 2015 04:30:45 +0000 Returning stability to China's equity markets dwarfs the resources so far publicly declared available to deliver it, raising the inevitable question of what more is left to come - and from where? The country's 120 billion yuan stock market stabilisation fund, paid for by the country's 21 biggest brokerages, is a fraction of the capitalisation of the country's 48 trillion yuan equity markets and less than 10 per cent of the 1.4 trillion yuan in outstanding margin finance. While the People's Bank... https://www.scmp.com/business/markets/article/1838185/cost-market-stability-and-how-pay-it?utm_source=rss_feed https://www.scmp.com/business/markets/article/1838185/cost-market-stability-and-how-pay-it?utm_source=rss_feed Sun, 12 Jul 2015 14:15:15 +0000 China’s 48 trillion yuan (HK$60 trillion) stock market starts the week at a critical juncture with investors far from clear on the direction that Beijing’s recent policy pronouncements are supposed to be pointing them towards. A market stability fund with barely enough capital to cover an hour’s worth of trade, a raft of administrative curbs on share sales and police raids on futures traders whose hedging tools are cornerstones of standard capital market risk controls are among the signs to many... https://www.scmp.com/business/markets/article/1837383/beijings-policy-missteps-leave-market-signals-far-clear?utm_source=rss_feed https://www.scmp.com/business/markets/article/1837383/beijings-policy-missteps-leave-market-signals-far-clear?utm_source=rss_feed Sun, 12 Jul 2015 10:30:00 +0000 The drop in the mainland equity market strikes a sombre tone, particularly in terms of the potential downside risks it poses to the economic growth in emerging markets. Analysts at Bank of America Merrill Lynch have run the numbers and found that not only has the world's second-largest economy been weighing on regional growth, but the drag has increased in 2014-15. The chart shows growth in emerging markets averaged across nine economies - Brazil, India, Indonesia, South Korea, Mexico, Poland,... https://www.scmp.com/business/article/1836618/chart-day-chinas-downward-drag-growth?utm_source=rss_feed https://www.scmp.com/business/article/1836618/chart-day-chinas-downward-drag-growth?utm_source=rss_feed Fri, 10 Jul 2015 14:30:45 +0000 Welcome to SCMP.com's live coverage of China's stock markets. One of the most volatile trading weeks in Hong Kong and mainland stocks draws to a close with investors still not yet convinced that the weeks-long rout in equities is completely over. We'll bring you updates as they happen on key price levels, the biggest fallers and gainers and other important trading data, as well as breaking news and expert opinion on significant developments.   4:15pm: The Hong Kong market was driven by... https://www.scmp.com/business/markets/article/1835587/china-markets-live-mainland-and-hong-kong-stocks-settle-higher?utm_source=rss_feed https://www.scmp.com/business/markets/article/1835587/china-markets-live-mainland-and-hong-kong-stocks-settle-higher?utm_source=rss_feed Fri, 10 Jul 2015 00:30:15 +0000 Structural shifts in international trade flows and industrial activity have likely turned China into the single biggest threat to global economic stability. Twin reports within 24 hours of each other from two of the world's biggest financial institutions - banking giant HSBC and global money manager Standard Life Investments - point to the mainland as their common denominator of risk to world economic well-being. "A hard landing in China would obviously be a large negative shock for the global... https://www.scmp.com/business/global-economy/article/1835483/global-growth-threat-posed-chinas-structural-economic-shift?utm_source=rss_feed https://www.scmp.com/business/global-economy/article/1835483/global-growth-threat-posed-chinas-structural-economic-shift?utm_source=rss_feed Thu, 09 Jul 2015 14:30:45 +0000 Asia's economic challenges might just be getting tougher if an extended export malaise is any guide. "Without a revival in shipments, it is difficult to foresee a pickup in growth more broadly," HSBC's economists write in a new note to clients highlighting a big shift in export patterns. Asia ex-Japan shipments to the European Union and the US are rising fast, but those to China are sinking at their quickest since the global financial crisis. "That's a worrying finding: if the slowdown in China... https://www.scmp.com/business/money/article/1835472/chart-day-whats-happening-asian-exports?utm_source=rss_feed https://www.scmp.com/business/money/article/1835472/chart-day-whats-happening-asian-exports?utm_source=rss_feed Thu, 09 Jul 2015 14:00:00 +0000 Good afternoon, and welcome to SCMP.com's live coverage of China's stock market chaos. China's market rebounded to finish higher while Hong Kong finished strongly as the weeks-long rout in equities seems to slow down for now.  As before, we'll be bringing you updates as they happen on price levels, the biggest fallers and gainers and other key trading data, as well as breaking news and expert opinion on key developments.   4:11pm: Investment and asset management firm China Everbright has... https://www.scmp.com/business/markets/article/1834517/volatile-china-stocks-close-higher-hong-kong-ends-sharply?utm_source=rss_feed https://www.scmp.com/business/markets/article/1834517/volatile-china-stocks-close-higher-hong-kong-ends-sharply?utm_source=rss_feed Thu, 09 Jul 2015 00:45:45 +0000 Mainland stocks in free fall despite a series of government policy interventions has many investors figuring it to be a sign of an impending financing catastrophe for the corporate sector. Not according to data crunched by analysts at HSBC. Stock market wealth is less than 15 per cent of household assets on the mainland and equity issuance is less than 5 per cent of total financing in the economy this year. Equity financing in the year to May stood at 290 billion yuan (HK$367 billion), just 4... https://www.scmp.com/business/money/article/1834263/chart-day-chinas-falling-stocks-herald-easier-credit-companies?utm_source=rss_feed https://www.scmp.com/business/money/article/1834263/chart-day-chinas-falling-stocks-herald-easier-credit-companies?utm_source=rss_feed Tue, 07 Jul 2015 12:45:00 +0000 The trigger for the spectacular sell-off from the speculative frenzy that drove mainland stock markets to seven-year highs is broadly being pinned on China’s 90 million mom and pop retail investors. Popularly painted as margin-funded, leveraged-up drivers of 80 per cent of typical daily turnover, they are an easy target given the surge in official margin financing to 2.3 trillion yuan (HK$2.87 trillion) in June, just as markets peaked, crested and began to fall. The reality of the exposure of... https://www.scmp.com/business/markets/article/1833389/chinas-margin-trading-binge-more-do-state-owned-enterprises-mom-and?utm_source=rss_feed https://www.scmp.com/business/markets/article/1833389/chinas-margin-trading-binge-more-do-state-owned-enterprises-mom-and?utm_source=rss_feed Mon, 06 Jul 2015 09:15:45 +0000 Restoring battered investor confidence is the cornerstone of Beijing's sweeping response to a US$2.8 trillion domestic stock market rout that could yet set off a systemic crisis and derail reforms to transform the country's economic model. The brevity of a relief rally at the start of trade and a mixed close shows investors are yet to be convinced by the slew of measures announced after a weekend meeting of the State Council, China's cabinet, chaired by Premier Li Keqiang . "Senior policymakers... https://www.scmp.com/news/china/money-wealth/article/1833325/investors-still-not-convinced-beijings-bid-end-us28-trillion?utm_source=rss_feed https://www.scmp.com/news/china/money-wealth/article/1833325/investors-still-not-convinced-beijings-bid-end-us28-trillion?utm_source=rss_feed Mon, 06 Jul 2015 05:00:15 +0000 The best guide to mainland share performance over the past decade has been Beijing's monetary policy settings. Tight policy caps upside, while loose policy lifts prices. That relationship broke down at the tail end of last year and is troubling equity analysts at Bank of America Merrill Lynch as by their measure, Beijing policy settings are their tightest in a decade despite recent interest rate cuts. If the relationship between policy and prices reasserts itself, a collapse in share prices... https://www.scmp.com/business/money/article/1831268/chart-day-china-shares-may-still-have-long-way-fall?utm_source=rss_feed https://www.scmp.com/business/money/article/1831268/chart-day-china-shares-may-still-have-long-way-fall?utm_source=rss_feed Wed, 01 Jul 2015 13:00:30 +0000 Investors pondering why Beijing's weekend interest rate cuts did not trigger a sustained rally for mainland shares yesterday can of course point to the rise in risk aversion sparked by the deepening Greek crisis. More mundanely, it may simply be that after four policy moves since November, the law of diminishing returns is being exerted on A shares. Analysts at Bank of America Merrill Lynch point out that each easing since November has delivered a smaller boost to sentiment than preceding ones.... https://www.scmp.com/business/article/1829239/chart-day-beijing-sees-diminishing-policy-returns-shares?utm_source=rss_feed https://www.scmp.com/business/article/1829239/chart-day-beijing-sees-diminishing-policy-returns-shares?utm_source=rss_feed Mon, 29 Jun 2015 13:45:30 +0000 Hong Kong capital markets broke records across the board in the first half of the year, according to exclusive preliminary data that reveals a surge in equity, bond and merger activity that sets the city's financial sector on course for a bumper 12 months. Equity and equity-linked capital raisings soared more than threefold in the second quarter from the first to bring the first-half total to US$52.2 billion - the strongest six-month period on record, according to data provider Thomson Reuters -... https://www.scmp.com/business/markets/article/1828511/hong-kong-regains-ipo-crown-deal-frenzy-sets-new-records-first-half?utm_source=rss_feed https://www.scmp.com/business/markets/article/1828511/hong-kong-regains-ipo-crown-deal-frenzy-sets-new-records-first-half?utm_source=rss_feed Sun, 28 Jun 2015 10:45:15 +0000 Beijing’s move to scrap the loan-deposit ratio lending cap on banks may be the clearest sign yet of how hard it is becoming for the government to ease monetary conditions given conflicting economic policy priorities. The government is trying to manage what economists call the “impossible trinity” – capital account opening, exchange rate stability and monetary policy autonomy. Alex Wolf, emerging market economist at fund manager Standard Life Investments describes it more colourfully as “the... https://www.scmp.com/business/markets/article/1826354/why-chinas-currency-key-resolving-its-economic-policy-trilemma?utm_source=rss_feed https://www.scmp.com/business/markets/article/1826354/why-chinas-currency-key-resolving-its-economic-policy-trilemma?utm_source=rss_feed Thu, 25 Jun 2015 04:30:15 +0000 The clamour for monetary easing on the mainland has intensified in the wake of last week's stock market falls in Shanghai and Shenzhen. The latest HSBC China Monetary Conditions Indicator shows a marginal improvement in absolute terms compared with April, aided by a slight weakening of the real effective exchange rate and an improvement in the growth of money supply. "This is the first sign that monetary conditions may be bottoming out," HSBC economists write in a note to clients. But "more... https://www.scmp.com/business/money/article/1826261/chart-day-easier-money-china-not-easy-enough?utm_source=rss_feed https://www.scmp.com/business/money/article/1826261/chart-day-easier-money-china-not-easy-enough?utm_source=rss_feed Wed, 24 Jun 2015 15:30:00 +0000 Global sourcing giant Li & Fung has signed its first mainland joint venture to develop own-brand product lines in a move that will help drive the firm's strategic shift towards supplying Asian consumers, group chairman William Fung told the South China Morning Post. "We've always said that as the economic centre of gravity moves towards Asia we will be putting more emphasis on developing the Asian market as not just a place to source from, but to sell to," Fung told the Post in a phone interview... https://www.scmp.com/business/china-business/article/1825292/supply-chain-giant-li-fung-signs-deal-build-store-brands?utm_source=rss_feed https://www.scmp.com/business/china-business/article/1825292/supply-chain-giant-li-fung-signs-deal-build-store-brands?utm_source=rss_feed Tue, 23 Jun 2015 13:00:45 +0000 Booming shadow banking growth has pushed China to the outer limits of its ability to service debt and keep its economy functioning smoothly, though spillover risks from a bursting of the credit bubble are containable, experts said on Monday. With total leverage in the Chinese economy now topping 280 per cent of gross domestic product, it was clear that credit quality was deteriorating, Primavera Capital Group founder and chairman Fred Hu told delegates at a Fung Global Institute forum. "It is... https://www.scmp.com/business/banking-finance/article/1818703/shadow-banking-boom-pushes-china-edge-debt-sustainability?utm_source=rss_feed https://www.scmp.com/business/banking-finance/article/1818703/shadow-banking-boom-pushes-china-edge-debt-sustainability?utm_source=rss_feed Mon, 08 Jun 2015 11:30:33 +0000 An estimated US$2.7 trillion push into real estate by the world's major central banks, sovereign wealth funds and state pension funds has raised the risk of inflating a dangerous global property bubble, a new report on public sector institutional investments warns. "Asset price bubbles have been building up in sections of the capital markets as a result of central banks' quantitative easing, particularly in Europe. These risks may now be spreading to real estate and infrastructure investment,"... https://www.scmp.com/business/markets/article/1806229/sovereign-wealth-funds-risk-inflating-global-property-bubble?utm_source=rss_feed https://www.scmp.com/business/markets/article/1806229/sovereign-wealth-funds-risk-inflating-global-property-bubble?utm_source=rss_feed Thu, 21 May 2015 13:46:09 +0000 Mainland first quarter balance of payments data signals capital flight accelerating, with net hot money outflows - the sum of non-foreign direct investment flows plus the central bank's "errors and omissions" account - at 9.25 per cent of GDP, a whopping US$840 billion. It is the US$80.2 billion errors account that has BNP Paribas economist Richard Iley most concerned. "On an annualised basis, unrecorded flows are running at a record 3.5 per cent of GDP," Iley said. Record outflows are hardly a... https://www.scmp.com/business/money/article/1795877/chart-day-china-hot-money-outflows-hit-record-pace?utm_source=rss_feed https://www.scmp.com/business/money/article/1795877/chart-day-china-hot-money-outflows-hit-record-pace?utm_source=rss_feed Wed, 13 May 2015 13:45:45 +0000 Rogue trader Nick Leeson says the surge in trading volume and rapid pace of regulatory change around the Shanghai-Hong Kong stock connect have created conditions ripe for market manipulation. The trader who famously broke Barings Bank in 1995 by making unauthorised bets on the futures markets in Singapore said the explosive pace of change had likely created a mismatch in available information to stock market dealers and regulators. "Wherever you've got change or a need to consolidate... https://www.scmp.com/business/article/1793903/nick-leeson-warns-hong-kong-shanghai-stock-connects-rogue-trading-risks?utm_source=rss_feed https://www.scmp.com/business/article/1793903/nick-leeson-warns-hong-kong-shanghai-stock-connects-rogue-trading-risks?utm_source=rss_feed Mon, 11 May 2015 15:45:00 +0000 Precious metals prices have largely moved sideways since the Federal Reserve's March rate-setting meeting that by all accounts should have been the spark that lit a fire under the market - particularly for gold. Broad dollar weakness over the last two months would usually have translated into support for gold. The crucial variable holding this relationship back is a change in inflation expectations, which have risen more slowly than US Treasury bond yields. This has caused real yields to push... https://www.scmp.com/business/money/article/1793602/chart-day-real-yield-rise-real-drag-gold?utm_source=rss_feed https://www.scmp.com/business/money/article/1793602/chart-day-real-yield-rise-real-drag-gold?utm_source=rss_feed Mon, 11 May 2015 12:45:00 +0000 Andrea Orcel wants to build the world's best investment bank at UBS. The firm's Asian operation might just be the place where he has a model for how he does it. Orcel is the president of UBS' investment bank, the unit at the heart of the Swiss banking group's global financial crisis problems and the one that analysts had largely written off as being ripe for closure or divestment as part of the "Accelerate" restructuring plan launched by the group to get its house in order in late... https://www.scmp.com/business/banking-finance/article/1792259/asian-operations-drive-ubs-investment-banking-growth?utm_source=rss_feed https://www.scmp.com/business/banking-finance/article/1792259/asian-operations-drive-ubs-investment-banking-growth?utm_source=rss_feed Sun, 10 May 2015 13:17:39 +0000 The technical outlook for the Shanghai share market remains positive, although the expansion in the proprietary selling pressure index from analysts at Lowry Research is worth monitoring. It is fast approaching its February peak and a sustained break above it would extend the upward trend and suggest the market could be subject to increased volatility in the weeks ahead. Short-term indicators suggest the current pullback has more room to run, which means investors waiting for a buying... https://www.scmp.com/business/money/article/1790157/chart-day-short-term-signals-dominate-shanghai?utm_source=rss_feed https://www.scmp.com/business/money/article/1790157/chart-day-short-term-signals-dominate-shanghai?utm_source=rss_feed Fri, 08 May 2015 14:00:15 +0000 Choppiness in mainland equities has much to do with the way international institutional investors are positioning for the likely inclusion later this year of A shares in MSCI stock indices. There are huge implications for fund flows if next month's review by MSCI does add an initial expected US$110 billion of mainland market capitalisation to the global fund benchmarks. Goldman Sachs forecasts an average of US$17 billion of net annual buying of mainland shares over the next decade. Recalibrating... https://www.scmp.com/business/money/article/1787769/chart-day-what-msci-might-mean-share-fund-flows?utm_source=rss_feed https://www.scmp.com/business/money/article/1787769/chart-day-what-msci-might-mean-share-fund-flows?utm_source=rss_feed Wed, 06 May 2015 13:45:15 +0000