Asian stocks decline for seventh day

**Nova Advisors analysis:  recent stock plunge coupled with continuing weak exports provide opportunities for longer-term negotiations with Asia-based suppliers.  Reducing risk for both parties include discussion around lower costs for minimum order quantities, increased spot buys of product, and possible partnership in tooling and streamlining operations.

Asian stocks outside Japan dropped, with the regional gauge on course for the longest losing streak in almost five months, amid global economic growth concerns.

The MSCI Asia Pacific excluding Japan Index slid 0.3% to 406.11 as of 4:10pm in Hong Kong, the lowest level since April 8. A report Wednesday showed US companies hired fewer workers last month than estimated, signaling employment gains may have slowed and adding to anxiety over growth. The data came ahead of Friday’s monthly government payrolls report on US jobs. Hong Kong property developers sank after Goldman Sachs Group Inc. forecast a slide in home prices. Equity markets in Japan, South Korea, Thailand, and Indonesia are closed for holidays.

“The overall sentiment is disbelief,” Michael McCarthy, chief market strategist at CMC Markets Asia Pacific Ltd., said by phone. “Investors are struggling to reconcile valuations with the risks. It’s going to remain a difficult environment.”

Global equities have fallen to their lowest level in almost a month amid concern over weak company earnings and lackluster data on manufacturing and employment. Federal Reserve Bank chiefs of Atlanta and San Francisco have highlighted the prospect of an interest-rate increase next month, with Friday’s US payrolls data seen as key to investors’ assessment of the next moves in monetary policy.

Gold Allure

Stan Druckenmiller, the billionaire investor with one of the best long-term track records in money management, said the bull market in stocks has “exhausted itself” and that gold is his largest currency allocation. He averaged annual returns of 30% from 1986 through 2010 at his Duquesne Capital Management.

Hong Kong’s Hang Seng Index lost 0.4% and the Hang Seng China Enterprises Index of mainland firms listed in the city fell 0.8 percent amid concern a pick up in economic growth is faltering. A private index of China’s services industry fell to 51.8 in April from 52.2 in March, Caixin Media and Markit Economics said on Thursday.

New World Development Co. led a slump for developers after Goldman Sachs downgraded Hong Kong property stocks, predicting a 20% drop in home prices. The Shanghai Composite Index climbed 0.2%.

NAB Gains

Australia’s S&P/ASX 200 Index rose 0.2%. National Australia Bank Ltd climbed 2% in Sydney after posting a 6.5% increase in first-half cash profit as it bucked a trend among Australia’s largest lenders by decreasing bad-debt charges and as margins improved for the first time since 2011.

Philip Lowe will replace Glenn Stevens as governor of the Reserve Bank of Australia for a seven-year term on Sept 18. Lowe inherits the post with diminished interest rate ammunition after the central bank eased policy to a record low to cushion the end of a mining investment boom and combat disinflation.

Crown Resorts Ltd, the gaming company of James Packer, rose 4.9%% in Sydney after selling $800 million worth of shares in its Macau venture, raising speculation the billionaire is increasing his firepower for a potential purchase of Australian casino assets. The sale was at a 6 percent premium, Deutsche Bank analyst Mark Wilson wrote in a report.

New Zealand’s S&P/NZX 50 Index added 0.8%%. Singapore’s Straits Times Index fell 0.6%. Taiwan’s Taiex index dropped 0.2%. The Philippine Composite Index retreated 1.2% before Monday’s presidential elections. The FTSE Bursa Malaysia KLCI Index dropped 0.7%. Futures on the S&P 500 Index gained 0.4% after the underlying gauge fell 0.6% Wednesday.

 

Reference:  Bangkok Post and Bloomberg, May 5, 2016

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About thomasdinnocenzi

Thomas D’Innocenzi is a highly accomplished, results-focused international consultant with extensive experience in global sourcing and business development worldwide to meet evolving business needs. Tom has proven ability in implementing and managing profitable global marketing and sourcing operations. He has extensive experience in international business development to accommodate rapid growth. Skilled in building top-performing teams, bench-marking performance, and developing organizations to improve efficiency, productivity, and profitability. Experienced transition leader and change agent. Tom founded Nova Advisors with the mission of providing expert Global Business Development consulting services for companies seeking to expand their market share as an independent consultant. Tom has a network of experts and advisors throughout the Asia-Pacific region and North America. His expertise includes business development, global sourcing, manufacturing, commodities, logistics, QA/QC, FDA, regulatory compliance, sustainability, and supply chain optimization. Tom is experienced in the medical device, apparel, consumer goods and technology services verticals helping companies advance their global sourcing capabilities and develop new markets through a local and sustained approach. Located in SE Asia and the United States, Tom expands market reach to drive sales. His global sourcing strategy includes directly negotiating with commodity suppliers, supply chain networks and distributors for optimal terms based on his expertise and first-hand knowledge of the players. Contact Tom to use his consulting service to increase your global market and make global sourcing profitable for you in the Asia Pacific Region and the United States. http://www.NovaAdvisors.com thomas@NovaAdvisors.com USA Direct: +1.904.479.3600 SINGAPORE: +65.6818.6396 THAILAND: +662.207.9269
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