Barefoot Investor: November 2013

Asian stocks rose, with the benchmark regional index climbing for the first time in four days, as the yen weakened against the dollar, boosting the earnings outlook for Japanese exporters.

Glorious Property Holdings Ltd. soared by a record 33 percent in Hong Kong after Chinese billionaire Zhang Zhirong offered as much as HK$4.57 billion ($589 million) to take the real-estate developer private.

The MSCI Asia Pacific Index  0.5 percent to 141.74 as of 11:26 a.m. in Hong Kong, with seven of the 10 industry groups on the gauge climbing. The measure advanced 9 percent this year through yesterday as investors bet the Federal Reserve will continue monthly bond buying into 2014. It is up 0.1 percent this week.

The MCSI Asia Pacific Index  traded at 13.8 times estimated earnings, compared with 16.2 on the S&P 500 and 15.1 for the Stoxx Europe 600 Index.

Regional Gauges

Japan’s Topix index advanced 0.8 percent as the yen declined to 101.22 per dollar, weakening past 101 for the first time since July. The Nikkei 225 Stock Average rose 1.2 percent. Bank of Japan Governor Haruhiko Kuroda said in parliament today in Tokyo that the yen isn’t “excessively weak.” The central bank yesterday maintained its unprecedented monetary policy.(Bloomberg)


KUALA LUMPUR: Headline inflation will be higher in October, led by the hike in fuel prices, said economists.

The consumer price index is expected to rise by an average 2.72 per cent year-on-year.

The Statistics Department will be releasing the data today.

HSBC Bank said base year effects, arising from the 10-11 per cent hike in subsidised fuel prices in September, will likely keep the reading on October CPI at 2.6 per cent, which will still place it within Bank Negara Malaysia's comfort range.

Excluding food and fuel prices, core inflation is also set to remain stable at 1.3 per cent year-on-year.Irvin Seah of DBS Bank said the recent spike in inflation is largely policy-driven.

The government cut both RON 95 petrol and diesel subsidies by RM0.20 per litre. This raised the pump prices for RON95 petrol to RM2.10/litre and diesel to RM2/litre, up from RM1.90 and RM1.80, respectively.

"While that will save about RM3.3 billion per year for the government, the inflationary effect has been manifested in the headline inflation number."

Seah said the days of strong growth and low inflation are coming to an end.

He said there is also little justification for Bank Negara to start tightening monetary policy as the growth momentum is already slowing on easing domestic demand, while the inflationary impact of policy changes will be transient.(Business Times)


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