Asian stocks up on solid US corporate results

Bullish trend prevailed at the Asian stock markets on Thursday.
Share prices jumped up after the news of increased industrial profits.
Morgan Stanley Asia Pacific Index rose by 1.4 percent while Japanese Nikkei Index rose by 1.9 percent. Shanghai Composite Index increased by 1 percent while Hong Kongs Hang Seng rose by 1.5 percent.US dollar has hit a 15 year record low in exchange of Japanese yen

KSE witnesses mixed trend

Karachi Stock Exchange has witnessed mixed trend on Monday.
Bears ruled Japan while Hong Kong and Korea remained up.
Morgan Stanley Asia Pacific Index gained 0.51 percent while Japans Nikkei Index 0.3 percent. Topix lost 0.8 percent.
Hang Seng hit 10-month high as it gained 1.4 percent.

morgan stanley

The Morgan Stanley building is seen in New York, Tuesday, April 20, 2010. Morgan Stanley said Wednesday, April 20, its first-quarter profit of $1.41 billion on strong results from its trading operations. The investment bank easily topped analysts’ expectations.

NEW YORK—Morgan Stanley said Wednesday its first-quarter profit surged to $1.41 billion on strong results from its trading operations. The investment bank easily topped analysts’ expectations.
Morgan Stanley said its earnings, which compare with a loss of $578 million a year ago, also came on a jump in its retail brokerage business. That’s a sign that individual investors might be getting more comfortable with returning to the stock market.

The investment bank, which was criticized last year for being too conservative as markets recovered, said it had $4.1 billion in sales and trading revenue, almost triple the $1.4 billion of a year earlier. Other banks with large trading operations, including JPMorgan Chase & Co. and Goldman Sachs Group Inc., also used trading profits to beat earnings’ forecasts.
The company’s stock rose $1.37, or 4.5 percent, to $31.82 in midday trading.

Banks have been profiting from continuing low interest rates that allow them to borrow money cheaply and put it into higher-yielding investments such as stocks.

Ruth Porat, the bank’s chief financial officer, said during a conference call with analysts that Morgan Stanley expects interest rates to remain low, which will help drive business in the coming quarters.

Euro extends gains; stocks firm

SYDNEY: The euro rallied further on Monday from 10-month lows, buoyed by a burst of short-covering as the quarter draws to an end, while Chinese shares hit two-month highs as investors bought large cap stocks like banks.

The euro bounced to as high as $1.3530 in early trade, up 0.8 percent from Friday, as traders continued to unwind bets against the currency after euro zone policymakers agreed on Thursday to create a safety net for debt-laden Greece.

But the euro is still set for its worse quarter since the height of the financial crisis in September 2008 as worries about Greece weighed on the currency and riskier assets such as stocks and commodities.

Asian stocks outside of Japan have recorded a mere 1 percent rise so far this year, calming after a 72 percent jump in 2009, but market watchers see a stronger second quarter if the region”s economic recovery remains robust and corporate profits pick up.

The MSCI Asia Pacific index ex Japan was 0.5 percent higher by late morning.

Japan”s Nikkei fell 0.5 percent to 10,939 as investors took profits after the benchmark hit an 18-month high last week, but has still gained around 3 percent so far this year.

“At this point, we”re predicting that some 80 percent of companies are likely to see improved profits, and some analysts are even more optimistic,” said Nagayuki Yamagishi, a strategist at Mitsubishi UFJ Securities.

“This optimism will really start showing up in the market at the end of April, when Japanese earnings move into high gear, and in the next quarter the Nikkei may well rise as far as 12,000.”

If the Nikkei manages to overcome resistance at 11,310, the 38.2 percent Fibonacci retracement of its 2007-2008 plunge, then the outlook may be as bright as suggested by the MACD and Ichimoku charts. Shanghai”s Composite Index rose more than 2 percent to as high as 3,127, above its key 125-day moving average, as investors bought shares of banks and other heavyweights ahead of the launch of the country”s first stock index futures on April 16.

The euro pared gains to $1.3441 by late morning, but has still lost about 6 percent against the dollar so far in the quarter as worries about Greece and other weaker euro zone members raised questions about the short- and long-term sustainability of the single currency.

While some market watchers thought the latest bounce may have wings, the latest data from the Commodity Futures Trading Commission suggested the euro has yet to win over many sceptics.

Net short positions had jumped over 1.5 times to nearly 75,000 in the week ending March 23, data had showed.

The dollar index against major currencies slipped 0.2 percent.

Elsewhere, oil prices CLc1 were a touch firmer, helped by a weaker U.S. dollar, which also lifted gold prices to a two-week high.

All eyes this week will be on the U.S. non-farm payrolls data on Friday. The consensus is for a gain of 190,000 jobs in March, the second month of job growth since the recession started in December 2007, and the largest increase since March of that year.

Other U.S. job data on Wednesday and Thursday could give clues on the non-farm number. Many markets around the world will be closed on the Good Friday holiday.

Oil range of $70-80 possible for 10 yrs: OPEC

CANCUN: Oil prices could stay in the $70-80 range over the next decade, according to a report by OPEC released ahead of a major oil conference this week which reiterated demand forecasts made last year.

In a paper written ahead of the International Energy Forum this week, OPEC said the price assumption is based on the perception of marginal supply costs over the medium to long term and stressed that it did not reflect or imply “any projection of whether such a price path is likely or desirable.”

“For the next decade, nominal prices are assumed to stay in the $70 to $80 a barrel range, while longer term they are assumed to remain in the $70 to $100 a barrel range,” the paper said.

The paper added the assumption reflects the perception that prices which are too low limit spending on oil exploration and production, while prices which are too high have a negative impact on the global economy and demand growth.

Ministers from top oil producing and consuming countries, as well as major energy executives are gathering for the biannual IEF at the Mexican resort of Cancun.

Both sides endorse, or at least do not reject, what Saudi Arabia this month called the “beautiful” price of oil, which has traded between $70-80 a barrel for much of this year.

Last week, BP Chief Executive Tony Hayward said an oil price of below $60-$70 a barrel would stop new investments to develop new energy supplies.

Oil prices surged to near $150 a barrel in July 2008, hitting developed economies already under pressure from the global recession. Prices fell to below $33 in December 2008 as the price rise battered fuel demand in the United States and other large consuming nations.

The price spike also prompted some consumers to seek ways to cut back on oil demand through increased use of alternative fuels.

In the paper, OPEC reiterated its long term view that global oil consumption would reach 106 million barrels per day by 2030, compared to today”s total demand of around 85 million bpd.

On Friday in New York, West Texas Intermediate crude oil closed at $80.00 per barrel, down 53 cents.

Proposals for OGDCL bonds due in cabinet next week

ISLAMABAD: The proposals from world’s top investment groups along with the market assessment for issuance of Oil and Gas Development Company Limited (OGDCL)’s bonds, would be tabled in the Cabinet in next few weeks, Geo News reported Monday.

These proposals will be tabled before the Cabinet Committee on Privatisation (CCoP) in the upcoming meeting next week, in accordance with the Privatisation Commission (PC) Ordinance 2000 under section 25.

The PC board in its meeting on March 18, 2010 attended by the representatives of Ministries of Finance and Petroleum and Natural Resources approved to obtain proposals and detailed market assessment for submission to CCoP to proceed further. Citibank, J P Morgan, Nomura Investment Inc; UK, Barclays Bank, Morgan Stanley, Goldman Sachs, Credit Suisse, Merrill lynch and others had also made presentations before the PC board including their top management through electronic mode. All these financial institutions have been asked for their respective proposals and reports. A summary in this regard has been sent to the prime minister.

The PC intends to appoint a book-running consortium for divestment of equity of OGDCL via a $500 million exchangeable bond with an upside option of $100 million with no sovereign resource. The groups have been asked to submit their separate sealed technical and financial proposals free of cost, indicating their relevant experience, competence of team, work plan, methodology and presentations with hard underwriting and coupon services.

The OGDCL bonds activity will build a diversified and high quality international investor base and would also improve standing of domestic capital markets through increased foreign institutional investors and foreign direct investment flows.

On March 25, 2010, the top management of OGDCL held a meeting with the minister for privatisation and expressed their full support for the completion of the transaction, which would help OGDCL to speed up their exploration activity. The minister assured the management to take forward the transaction on fast-track basis keeping in view the keen interest being shown by the market players.

Chesapeake Energy

Chesapeake Energy : One analyst said Morgan Stanley cut its classification Chesapeake Energy Corp. Monday, saying it is on track to achieve growth in production, but there are a few “company – a specific catalyst” that could move the share price.

In a research note to clients, and reduce the level of analyst Stephen Richardson Chesapeake to “equal weight” from “overweight.”

Chesapeake are on track to increase production by 8 percent to 10 percent this year, he said.

“The company is directed to high natural gas sector and the large stone 6 plays remain the main drivers of growth (Chesapeake) to move forward,” said Richardson.

“We still see the top of the current levels, but the risks and offered a more balanced today,” he said.

Chesapeake shares fell 22 cents to close at $ 25.42.

Bullish Trend in Asian Stock Markets

Bullish Trend in Asian Stock Markets, Renewed optimism over an improving global economic picture helped most Asian shares rise Thursday following a boost by strong Australian jobs data. Morgan Stanley Asia Pacific Index reached the level of 126 points in Tokyo. Investment in financial companies was witnessed. The Japan’s Nikkei-225 index climbed to 1.1 percent whereas S &P Australia also rose 0.4 percent. Lift in Shanghai Composite Index by 4 percent was also observed.

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Bullish Trend in Asian Stock Markets was first posted on January 14, 2010 at 7:43 pm.

Ctrl BG: A Shortcut to Financial News 10/24

Is it just me, or is it not even news anymore that there was a huge drop/rally in the market on a given day? Now that we’ve broken all the records in the last century, it’s hard to be fazed by big swings in the market. I think my next threshold is if (or is it when?) the Dow hits the 7000s.

But anyway, the global market went on another roller coaster ride this week, ending with a big drop on Friday. Asia in particular took a big hit. On the Hong Kong stock exchange, HSBC, the darling of all stocks there, fell by 10% to $88, a 4 year low. I personally could not remember HSBC being below $100…. ever. People are shocked and heartbroken. I don’t blame them. The HSBC stock to HK investors is like how Louis Vuittons is to Japanese women- everyone owns at least one or aspires to own one. To see the value of such an entrenched brand go down must be a very traumatizing experience indeed. Who knew that Morgan Stanley slashing the price by 25%, would have such a profound effect?

Back to the rest of the world, developed and emerging markets alike are hit due to slumping currencies and higher financing cost. ING is is latest “big gun” to be bailed out with a $13.5 billion Dutch government injection. And countries such as Iceland, Pakistan and Turkey are in talks with the IMF for help.

In the US, experts have placed the blame on hedge fund of funds. Since investors can pull money out of hedge fund of funds anytime they want i.e. now, this has in turn put pressure on hedge funds to pull out of the market and thus the crazy selling and shorting to cover losses. The mounting layoffs *yikes!* (Goldman announced they were cutting back 10% of their workforce-less than I expected!), speculations about whether we’re in a recession or not (do we really need anymore proof?), Greenspan admitting to be “partially wrong” and bad company earnings report coming out didn’t help. Oh and PNC just announced that they were taking over National City for $5.2 billion (backed by tax payers). This is the next big bank takeover since Wachovia two weeks ago. Investors are now waiting to see if the Fed will further lower interest rates next Wednesday and whether the US economy is indeed in a recession with the GDP data coming out next Thursday.

It’s not a completely gloomy outlook though. Asian countries, following Europe, are starting to form their own $80 billion emergency fund- better safe than sorry. The US are working on another stimulating package and a plan to bailout individual home owners, so then they can get better termed loans. Call me a selfish hypocrite, but while I’m all for bailing out banks because it affects me, I’m not sure how I feel about bailing out individuals. Makes me think, “if I knew the government was going to bail them out, maybe I should’ve gone and bought a house I clearly cannot afford too!” Logically though, I know helping them would help the economy as a whole, since foreclosure is one of the biggest issues. Guess I’ll get around to the idea.

On a side note, did you know that the $250 billion capital injection into banks last week is not part of the $700 billion package? I wasn’t sure myself until this week. How come they need approval for $700 billion and not $250 billion? $250 billion is still a LOT of money.

( This post is from an independent writer. The opinions and views expressed herein are those of the author and are not endorsed by trendpk.Com.)

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Ctrl BG: A Shortcut to Financial News 10/24 was first posted on October 25, 2008 at 11:10 am.

Oil rises above $80 amid stock market surge

SINGAPORE: Oil prices rose above $80 a barrel Friday in Asia as crude investors eyed a surge in global stock markets. Benchmark crude for December delivery was up 47 cents to $80.09 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange

SINGAPORE: Oil prices rose above $80 a barrel Friday in Asia as crude investors eyed a surge in global stock markets.

Benchmark crude for December delivery was up 47 cents to $80.09 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 78 cents to settle at $79.62 on Thursday.

Oil traders often look to stock markets for a sense of overall investor sentiment, and the Dow Jones industrial average rose 2.1 percent Thursday on better-than -expected jobless claims numbers and positive forecasts by Cisco Systems Inc. All major Asia indexes were also up in early Friday trading.

Crude investors are also watching signs in recent weeks of a drop in U.S. oil supplies, which increased sharply this year as demand shrank. Some analysts forecast higher oil prices next year as the economy strengthens and demand recovers.

“We expect fundamentals to improve as oil demand growth resumes,” Morgan Stanley said in a report. “Until the oil market tightens, oil will be dragged in the wake of other risky asset price moves.”

Morgan Stanley said it expects oil to average $85 a barrel next year.

Crude has crisscrossed the $80 level for the last few weeks as investors mull weak U.S. consumer demand and a volatile dollar.

In other Nymex trading, heating oil rose 1.16 cents to $2.07 a gallon. Gasoline for December delivery gained 0.99 cent to $2.00 a gallon. Natural gas for December delivery fell 1 cent to $4.78 per 1,000 cubic feet.

In London, Brent crude for December delivery rose 66 cents to $78.65 on the ICE Futures exchange.