Sands China falls most since turn of year Sands China’s share price dipped to a seven-month low in Hong Kong yesterday. It was reaction to the Macau unit of casino operator Las Vegas Sands Corp. recording a 40 percent year-on-year fall in net income for the second quarter, to US$160.5 million (1.28 billion patacas). The company said it was mainly due to one-off costs and an unlucky quarter in baccarat. Page 2
GDP Rocketing growth ‘too long’: economist I
nflation remains at a worrying level, and slower growth in gross domestic product might help prevent the market overheating. That’s a view of local economist Albano Martins. Fellow economic scientist José de Sales Marques, head of the Institute of European Studies, estimates expansion for this year at 10 percent to 13 percent. That’s more than the Monetary Authority of Macau’s projected “high-singledigit” growth mentioned in a report earlier this week. “It certainly won’t be a high-two-digit growth, like the University of Macau economists predicted,” added Mr Martins The territory’s yearly inflation rate has remained above six percent year-on-year in the past few
months. The government says mainly “domestic forces” have driven the territory’s inflation, with housing and food expenses accounting for more than half of it. “In addition, inflation begins causing strong pressures, namely on home rents,” stated Mr Martins. “Skyrocketing growth should be temporary but in Macau it has extended for too long.” In the first quarter the economy grew at an annual rate of 18.4 percent. Mr Sales Marques said Macau’s growth will “depend on what happens on the Chinese market” and he expects the growth rate to be a bit more than ten percent because of the “possibility of China reacting with a further stimulus programme”.
I SSN 2226-8294
HANG SENG INDEX 18960
18910
More on page 3
18860
Draft’s wind of change for legal industry
18810
July 26
Rules on setting up law firms should be ready this year – 17 years after they were first proposed. Macau currently has a system whereby all lawyers are technically in single practise but often share offices and often act collaboratively as if they were partners. An industry argument against regulating for law partnerships is that it would allow big foreign firms to move into the market.
HSI - Movers Name
%Day
LI & FUNG LTD
3.75
CHINA OVERSEAS
2.94
CHINA UNICOM HON
2.37
COSCO PAC LTD
2.11
‘No build no pay’ fix for pre-sold flats
CITIC PACIFIC
1.13
BANK OF COMMUN-H
-1.02
HONG KONG EXCHNG
-1.28
CHINA PETROLEU-H
-1.33
A legislator says the government should consider a ‘no build no pay’ system in the real estate market. It would they say protect consumers from developers that pre-sell flats then stall on the building work – while still demanding monthly payments from the customers. Kwan Tsui Hang said a mandatory property registration system would not be strong enough to deter cowboys.
HENDERSON LAND D
-1.72
SANDS CHINA LTD
-4.94
Page 2
Source: Bloomberg
Page 5
New Macau wants to double dismissal compensation Workers dismissed without cause should be able to get twice as much compensation as at present, say three pan-democrat legislators. They want a vote in the Legislative Assembly over the heads of the Executive Council to increase the payout to 28,000 patacas (US$3,500) from 14,000 patacas currently. Compensation levels haven’t been revised since 1998 but residents’ median monthly income has gone up 120 percent.
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News where it matters
Page 7 www.macaubusinessdaily.com
Year I - Number 85 Friday July 27, 2012 Editor-in-chief: Tiago Azevedo Deputy editor-in-chief: José I. Duarte MOP 6.00
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business daily July 27, 2012
macau
Sands China stock slips to seven-month low Net income falls 40 pct in Q2 on exceptionals; boss says still outperforming market Associate Editor
S
ands China’s net income for the second quarter dropped 40 percent from a year earlier to US$160.5 million (1.28 billion patacas), according to a filing with the Hong Kong Stock Exchange yesterday. The gaming operator said the decrease in net income was mainly due to several unusual factors. One was a US$100.8 million non-cash impairment loss on preparatory work for Cotai Lots 7 & 8 – pieces of land the Macau government decided in December 2010 to “not approve” for use by Sands. The company finally dropped legal claim to the land in May. Another drag on net income was one-off opening costs for Sands Cotai Central, which had its first phase launch on April 11. Preopening expenses increased to US$43.5 million in the second quarter of 2012, compared to US$18.2 million a year earlier. A third factor was bad luck for the
house. VIP players won a greater percentage of rolling chip play from the company’s Sands Macao and Venetian Macao casinos while engaging in the notoriously volatile local table game of choice, baccarat, than they did in the same quarter a year earlier, said the company. At Sands Macao, rolling chip win was down 0.40 percent and at The Venetian Macao down 0.78 percent. But during an earnings conference call, Sheldon Adelson, chairman and chief executive of the parent firm Las Vegas Sands Corp., mounted a robust defence of company performance, pointing out that globally until Q2 2012, LVS had experienced 11 consecutive quarters of growth.
Stock falls Sands China said its total net revenues for the second quarter of 2012 rose 22.3 percent year-
Comparative evolution: Las Vegas Sands (1928 HK) and Hang Seng Index Year-to-date (values re-based to January 3, 2012) 145
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on-year to US$1.48 billion on a U.S. GAAP [generally accepted accounting principles] basis. Mr Adelson added it was the first time since 2008 the gaming operator had outperformed the overall Macau market growth rate in VIP table gaming, mass-market table play and slot machines. “Our overall market share of gross gaming revenue in Macau also increased to 17.7 percent in the second quarter of 2012 compared to 16.0 percent in the second quarter of 2011,” he said. Sands China’s share price closed yesterday at HK$21.15, down 4.94 percent on the day, on the second quarter results – its lowest level in seven months. The local unit’s stock has fallen 30 percent from its peak, due to investor concerns about China’s shortterm macroeconomic outlook, the slowdown in the VIP gambling market and some disappointment in the initial performance of Sands Cotai Central’s phase one opening. J.P. Morgan said in a note yesterday: “While we expect near-term share price weakness on earnings downgrades, in the medium term Sands continues to stand out for its mass market focus (the segment which continues to deliver sturdy growth), earnings growth ahead of its peers (the only operator adding capacity before 2015), strong cash flow and dividend yield (six percent in financial year 2013).” Wells Fargo in New York said LVS’s Macau and Singapore results missed the bottom of consensus by three
percent and 12 percent respectively. “Normalised total Macau EBITDA of US$436 million (our estimate) missed our Street-low US$441 million. Normalised Singapore EBITDA of US$374 million was well below the US$400 million expected by investors, and declined four percent year-on-year.”
KEY POINTS Sands China Q2 net income falls 40 pct – mainly on oneoff costs Net revenues for Q2 up 22.3 pct y-on-y to US$1.48 billion Sands China stock dips to 7-month low in Hong Kong trading Until Q2 2012, LVS globally had 11 consecutive quarters of growth – chairman ‘Mistake’ made in massmarket games mix for Sands Cotai Central opening
Sands Macao – profitable since 2005
LVS share price downturn chance for buy back ‘Mistake’ made with ‘underperforming’ Sands Cotai Central start
T
he fall in Las Vegas Sands’ stock price may be an opportunity for the strongly cash flow positive company to buy back shares, said the chairman Sheldon Adelson yesterday. “…I think I’m going to have a call with the members of the board to see if we could put aside some money to buy back some shares at these prices,” said Mr Adelson during the second quarter earnings conference call. But he added that the focus might remain with dividends. LVS approved its third consecutive quarterly dividend of
US$0.25 per share on Tuesday. Although the company had US$9.4 billion in outstanding debt globally as of June 30, it also held approximately US$3.5 billion of cash and cash equivalents as of the same date said Kenneth Kay, the chief financial officer. Mr Adelson confirmed that Sands Cotai Central will not get a full allocation of 200 new tables for its phase two opening and will have to move some tables from other properties. He didn’t say how many. “We’ll need to take tables from elsewhere to get up to 200 tables for
SCC phase two,” he told analysts. “On September 20 [the opening], we will not have all of those 400 [for the whole property], but we will be getting them throughout the rest of the year,” he added. Rob Goldstein, president of global gaming operations, admitted to analysts that the company’s latest Macau resort had not so far performed as well as hoped, and that there had been a “mistake” made on the massmarket games mix. “Sands Cotai is underperforming in the mass table side and doing pretty well in the VIP side,” he stated.
Later he added: “…the shortcoming in Sands Cotai is in a mass and premium mass [market], which is the sweet spot of that property’s fiscal ability. I think once we figure it out, we can get our space right. We also – let’s face it – didn’t put enough slot ETG [electronic table games] product on the floor. Let’s not kid ourselves. It was a mistake not to do that. We had 800 positions right now that are outproducing all other properties. So we’ve got to get more slot ETG positions. That comes together in the fall,” he stated. A.E.
July 27, 2012 business daily | 3
MACAU
Economists praise growth slowdown Economists believe slower growth might reduce the risk of the economy overheating Xi Chen
xi@macaubusinessdaily.com
T
he Monetary Authority of Macau projected this week that gross domestic product would grow at a “high-single-digit” rate this year, echoing the forecast that Secretary for the Economy and Finance Francis Tam Pak Yuen made earlier this month. Economist José de Sales Marques, however, told Business Daily that his forecast of economic growth this year was 10 percent to 13 percent. Another economist, Albano Martins, said: “Earlier this year I said a high-one-digit growth was the pessimistic forecast. But I still think low-two-digit growth is possible. It certainly won’t be a high-twodigit growth, like the University of Macau economists predicted.” Mr Marques said growth would
depend on what happened in the mainland and he expected it to be a bit more than 10 percent because of the possibility of the mainland taking further steps to stimulate its own economy. The mainland economy was running the risk of overheating last year, when it grew by nearly 10 percent and inflation was 6 percent. Its annual growth slowed to a 7.6 percent in the second quarter, the slowest in three years, and annual inflation slowed to below 3 percent last month. Mr Martins said mainland stimulus measures “are aimed at reviving the domestic economy by boosting consumption”. He said such measures “will have an impact in Macau, but a small one”.
Mr Martins said that with gaming revenue growth here slowing, the economy would slow, too. “The gambling industry is the engine of Macau’s economy and it has become noticeable that the economy usually grows at about half the rate casinos are growing at.” Mr Marques said: “Even at a lower rate, the territory still has healthy growth, and it is better for the economy in the long term not to overheat”. Mr Martins said: “Fast economic growth leads to high inflation and shortages of human resources and available land. Inflation remains at a worrying level, where the economic gains are quickly spent due to higher prices.” The annual rate of consumer price
inflation rate has remained above 6 percent for months. The Monetary Authority said this week that inflation was due mainly to “domestic forces”, with housing and food accounting for more than half the inflation rate. Mr Martins said: “Inflation begins causing strong pressures, namely on home rents. Skyrocketing growth should be temporary, but in Macau it has extended for too long.” In the first quarter the economy grew at an annual rate of 18.4 percent. “We must move to a more moderate growth, around 6 percent to 7 percent, which would still allow for new jobs to take up the youth joining the labour market,” Mr Martins said. with V.Q
Fitch lowers Macau revenue outlook twice in two months Forecast reduced to 10 pct to 12 pct for whole of 2012
F
itch Ratings says it expects low to single digit growth in Macau gaming revenues for the remainder of 2012. The company revised its Macau gaming revenue growth forecast for the whole of the year to 10-12 percent from 15 percent. Fitch, a global provider of credit opinions, research and data, said the revision marked: “…our more cautious view with respect to the near-term impact of the slowdown in China,” adding “Our updated forecast implies low-to-mid singledigit market revenue growth for the
rest of 2012.” Up to June Macau was expanding by 20 percent yearon-year, but the slowdown appears to have become a trend since May. Analysts point out there is a strong positive correlation between the mainland’s economic growth and that of the Macau gambling market. Around 60 percent of visitors in the first half of the year came from the People’s Republic according to Macau government data. The agency was slightly more upbeat on China’s prospects for 2013, revising GDP expectations to 8.2 percent from eight percent
Typhoon Vicente contributed to ‘sluggish’ July – Fitch Ratings
in expectation of “a modest policy stimulus” for the second half of 2012. Fitch added it was “comfortable” with Macau’s medium term “supplydemand fundamentals”. It is however Fitch’s second downward revision for Macau’s prospects in fewer than two months. On June 8, the revenue growth estimate was reduced to 15 percent from 20 percent. Macau gaming grew 42 percent year-on-year in 2011 and 58 percent in 2010. “We expect July to also reflect a sluggish trend, possibly in the low-single digit range,” said the
ratings firm. Fitch added current trading conditions could make life harder for some VIP junkets – the middlemen that supply the players that contribute around 70 percent of the city’s casino revenue. “Junket operators might find it increasingly challenging to access credit as conditions tighten in China, but this has not proved a problem for larger junket operators yet. However, it could potentially have an adverse effect on smaller, less well-capitalised junkets,” it added. A.E.
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business daily July 27, 2012
macau Brought to you by
HOSPITALITY Asian arrivals dip The tourist arrival statistics from last month confirm a few trends and raise a few questions. Macau welcomed 3.4 percent fewer visitors last month than a year before, mainly because we had fewer tourists from Asia – even though we had 1.8 percent more from the mainland, the source of more than half of the city’s visitors. There were fewer visitors from about half the countries that the statistics treat separately, most were countries in Asia.
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Pressure grows for doctors’ insurance Legislators want to make professional liability insurance for physicians mandatory, so do doctors – if somebody else pays for it
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Vítor Quintã
vitorquinta@macaubusinessdaily.com
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Singaporeans stayed away in greater numbers than any other Asian nationality, the number of visitors dropping by more than one-third. The number of visitors from other important Asian markets – India, Taiwan, Malaysia and Indonesia – fell by between 10 percent and 25 percent. These falls all confirm what appears to be a trend established in the first half of this year. Does this mean the competition is beginning to poach our visitors? Aside from South Korea, the table clearly shows that the depth of the falls in numbers of visitors from each country last month was greater than the depth of the falls in the first half as a whole. That is, last month’s figures may point to a steep, downward trend. But we should keep all this in proportion. About 85 percent of Macau’s tourist arrivals came from the mainland and Hong Kong last month. Add the visitors from Taiwan, and Greater China as a whole was the source of 90 percent of all arrivals. Only four other countries were each the source of more than 1 percent of all visitors: Japan, Malaysia, Korea and the Philippines – and even then, none was the source of much more than 1 percent. J.I.D.
embers of the Legislative Assembly have called for the government to make professional liability insurance for doctors and clinics compulsory, and to set up a compensation fund for the victims of medical malpractice. In view of a public clamour for medical malpractice legislation,
which the government has been thinking about since 2002, the assembly’s third standing committee has been looking into the issue. The committee’s report says the government should consider “a mandatory insurance system for healthcare professionals and entities that provide healthcare services”.
The president of the Association of Macau Portuguese-speaking Physicians, surgeon Rui Furtado, praised the committee’s suggestion. Mr Furtado told Business Daily the professional liability insurance premiums should be paid by the employers of healthcare professionals. The committee’s report calls for further study of the feasibility of “a special public fund and a compensation system for medical errors without fault” – a system that it claims is also in place in France and Belgium. But it says the study would have to be “scientific” and take into account “the benefits and evils of this system”. Mr Furtado is wary of the proposal, saying he knows of no such system anywhere. “As far as I know, usually hospitals take responsibility for their professionals and take up insurance for that,” he said. He said erring physicians and others could always be held criminally liable, if their errors warranted it. The government has told the assembly it will begin drafting a medical malpractice bill in the fourth quarter. Mr Furtado says the legislation is pointless. He said the Civil Code already covered liability for medical errors, and that a specific law “will only create more confusion”. Last year, Macau Lawyers Association head Jorge Neto Valente said that a medical malpractice law was “unnecessary”. The committee report says the law as it stands “has proven to be insufficient” for dealing with medical errors.
Taipa transportation hub close to kick off Construction of the hub’s first phase will begin in August and be ready by 2014 Xi Chen
xi@macaubusinessdaily.com
A
central transportation hub The schedule means that the first in Taipa, located on Estrada phase of the hub will be in operation Governador Albano de Oliveira, right before the Light Rapid Transit is at the last stage of preparation before system starts operating, which is projected to be in early 2015. starting construction next month. The project, composed of two The hub, located right opposite the phases, will integrate different Macau Jockey Club, will include an public transportation systems and underground parking space that provide a place for people to switch can accommodate 59 tour buses, between the Light Rapid Transit, a ground-level bus terminal and passenger pickup area, as well as bus and taxi. Ao Ieong Iong, a senior technician an upper level community centre and pedestrian at the Transpassage with portation Infragreen areas. structure Office, The hub, once said that phase finished, is exone of the projpected to sigect will take nificantly shortmore than two en travel time, years and is escost of the first phase improve public timated to cost space and ease 428 million paof Taipa’s central the traffic envitacas (US$53.6 transportation hub ronment in the million).
MOP428 m
area, the government said. After the project is done, the number of parking spaces will jump by 30 percent, the area used for public and green spaces will more than double and the area for all-weather bus stops will almost triple. There is no schedule for the second phase yet as it will depend on the progress of the first, Chow Wai Tak, a technical consultant from the Transportation Infrastructure Office said. He also added that the government does not exclude the possibility that there might be a public tender again for the second phase. Top Builders International Company Ltd, part of the construction group that built Sands Macao hotel-casino, Macau Cultural Centre and Macau Museum, won the public tender for the first phase.
July 27, 2012 business daily | 5
MACAU
InBrief Half city reaps savings top-up The government is set to put at least 2.3 billion patacas (US$288 million) into central savings system accounts this year. It says around 308,000 applicants have so far qualified to receive a 6,000 pataca top-up. About 96,000 applicants did not qualify but have the right to an appeal. Permanent residents aged 22 or older that were in the city for more than six months last year are eligible.
Brick-by-brick payments for homes proposed HK$10m reward for Ng assailants Former New Century Hotel shareholder Ng Wai is offering a HK$10-million (US$1.25 million) reward to anyone providing information leading to the arrest of his assailants, according to an advertisement in the Chineselanguage Macau Daily News. Six people set upon Mr Ng in the hotel last month. He says the attack was planned by someone who knew where to find him, had switched off the hotel’s surveillance cameras and distracted its security staff.
Cemetery affair probe complete The investigation of the cemetery affair involving Secretary for Administration and Justice Florinda Chan is complete, and the Public Prosecutions Office has come up with a suspect, according to legislator Au Kam San. Mr Au told reporters on Wednesday that prosecutors could not reveal if or when charges would be laid. The Public Prosecutions Office began its investigation on the strength of a report from the Commission against Corruption.
Tunnel boss says cave-in harmless The project manager for the builder of the tunnel to Hengqin island, Xu Xiao Chen, has insisted that a cavein at the construction site last week injured nobody. The government says the contractor – CCCC Fourth Harbor Engineering Co Ltd, an arm of state-owned China Communications Construction Co Ltd – has submitted a report on safety at the site.
Legislators say the government’s proposals for a law on sales of uncompleted homes are insufficient Tony Lai
tony.lai@macaubusinessdaily.com
M
embers of the Legislative Assembly have urged the government to legislate to link a buyer’s payments for a new home to the progress the developer makes in building it. Kwan Tsui Hang, who chairs the assembly’s second standing committee, told reporters after a meeting with government officials yesterday that members want more than a mandatory registration system to protect homebuyers. The government has proposed to make it compulsory to register the sale of an uncompleted home within 30 days, failing which the developer would be fined. Ms Kwan said the government thought this was enough to protect buyers, but that most legislators thought otherwise. Her committee thinks the government’s proposal would be no use if a developer stops construction but demands payment from buyers.
“Some propose that the law should allow buyers to decide how much they should pay to the developer in advance, in accordance with the project progress,” Ms Kwan said. “The developer can only get full payment after they have completed the building. This can help ensure the company finishes the property on time.” Some legislators have suggested that a developer be allowed to spend the money it gets from buyers only on construction. Ms Kwan said the government had agreed to consider the assembly’s opinions but had warned that there were “great difficulties” in making such provisions, which might conflict with other rules and regulations. The committee said the government could also take it upon itself to enforce payment clauses in contracts of sale. Ms Kwan said her colleagues
also thought the government would allow developers to start selling homes at too early a stage of construction. The government is proposing to allow the Land, Public Works and Transport Bureau to give developers permission to begin selling homes only once the foundations and basement of the building are finished. Ms Kwan said some governments allowed sales only after one-third of a building was complete. Macau would consider permitting sales only at a later stage of construction. She said the assembly and the government agreed that a law on the sale of uncompleted homes should be passed as soon as possible. The law would aim to protect buyers when developers run into financial trouble or turn out to be fraudsters. There is no schedule for the legislation to pass into law.
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business daily July 27, 2012
macau
Commission created to draw up law firm rules
Brought to you by
Testing relationship Forecasting Macau’s growth is notoriously tricky. The nature of the economy – small, open, dependent on gambling and tourism – inevitably makes forecasts difficult. Many important variables are affected by decisions over which the local agents have little control. The economy’s main sectors are sensitive to external economic forces, social changes and political imponderables. It is, however, clear that there must be a relationship between the evolution of gambling revenues – the city’s main economic activity and greatest source of income – and the evolution of gross domestic product or GDP. Many assume this is a straightforward relationship. There is also a perception that revenue from gambling will not stop growing; that the sky is truly the limit. The figures for both the changes in gambling revenue and GDP over the past six years show that the reality is not so orderly.
Gambling revenue and GDP Homologous growth rates
Expect to see guidelines governing the establishment of law firms drafted this year
% 80
60
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2006 Q1 2006 Q2 2006 Q3 2006 Q4 2007 Q1 2007 Q2 2007 Q3 2007 Q4 2008 Q1 2008 Q2 2008 Q3 2008 Q4 2009 Q1 2009 Q2 2009 Q3 2009 Q4 2010 Q1 2010 Q2 2010 Q3 2010 Q4 2011 Q1 2011 Q2 2011 Q3 2011 Q4 2012 Q1
0
Gambling
New rules for the establishment of law firms will probably be voted in October
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Vítor Quintã
GDP
vitorquinta@macaubusinessdaily.com
The graph debunks the assertion that gambling revenues can only increase. The size and annual growth of gambling revenues has surprised many – measured by a simple average it has increased by 35 percent – but growth has varied wildly and is extremely sensitive to external financial conditions. Monthly growth in gaming revenues ranges between minus 12.7 percent and 76.5 percent. GDP has extreme values of minus 9.4 percent and 38.8 percent. The similar patterns in the graph point towards a correlation between the two, but it also suggests that the relationship, albeit strong, is more complex than commonly thought. J.I.D.
Rules on the establishment of law firms should be ready this year, with the Macau Lawyers Association creating a commission of nine lawyers to draft them. Litigation expert Álvaro Rodrigues told Business Daily the commission would meet for the first time next week. He said the commission would use draft rules put forward in the 1990s as a starting point and that new proposals should be ready in September. “The commission is composed by highly regarded practitioners and it is expected to produce a proposal that will suit the needs and interests of all lawyers and of the community in general,” Gonçalo Mendes da Maia, a partner at law firm MdME, told Business Daily. The association will regroup, probably in October, to vote on
the proposals. But the head of the association, Jorge Neto Valente, said there are different opinions on the path the draft should follow. “For those who believe law practice is not a business, they think law firms must have only lawyers as associates, that its civil liability must be unlimited and that advertising must not be allowed,” he told Business Daily. The city has had unofficial law firms for some time but they are constituted like commercial companies, which has resulted in lawyers being associates in two different firms or firms having people other than lawyers as associates. “That is due to the ignorance of some public services, particularly the notary at IPIM [Macau Trade and Investment Promotion Institute], which accept firms with illegal purposes,” he bemoaned. The rules give firms three months to fall in line, otherwise they will be considered defunct.
If the association approves a proposal, it will be sent to the government to be made law. Mr Rodrigues said the government should have the proposals this year. João Nuno Riquito, an expert on commercial, business and corporate law, says law firms should have limited liability, stressing that the professional liability insurance with a minimum of 2 million patacas (US$250,000) is “no longer adequate”. But Mr Valente warned that allowing law firms to have limited liability would create “unfair competition” with private practices. The draft says the names of law firms must include the names of some or all of the partners and must not be ‘invented names’ or acronyms But many of the big law firms that have already been established here de facto but not de jure use acronyms. “It’s a serious questions because some people think allowing a law firm to call itself ‘Number One’ is advertising,” Mr Valente said.
Weather Beijing 29/24o C Changchun 27/21o C
Harbin 27/18o C
Xian 34/24o C Shanghai 34/28o C Chengdu 28/24o C Kunming 25/17o C Haikou 33/25o C Sanya 30/24o C
Guangzhou 29/24o C
MACAU (23 July-28 July) Day
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Shenzhen 33/26o C
ASIA (today)
Hong Kong 31/27o C
Manila
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30/24o C
33/25o C
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Macau 27/23o C
Bangkok
SEOUL
K. lumpur
34/26o C
SINGAPORE
33/24o C
33/24o C
taipei
31/26o C
July 27, 2012 business daily | 7
MACAU
Push for double ceiling in unfair dismissal cases Pan-democrat lawmakers want greater compensation for workers fired unfairly Tony Lai
tony.lai@macaubusinessdaily.com
T
he trio of New Macau Association legislators have submitted a revision to the labour relations law that increases compensation for workers dismissed unfairly. The proposal doubles the maximum salary used to calculate compensation to 28,000 patacas (US$3,500) from 14,000 patacas. The current amount has remained unchanged since 1998. “Owing to the economic growth in recent years, we propose this necessary, conservative adjustment,” Member of the Legislative Assembly Ng Kuok Cheong told a press conference yesterday. The legislators said the increased compensation ceiling was based on the rise in median monthly income from about 5,000 patacas in 1998 to 11,000 patacas today. Mr Ng said the proposal stopped short of a greater increase in the ceiling to give the public and businesses time to accept the change. He said if the ceiling did not change, current compensation payouts would
be on par with the earnings of about 65 percent of the workforce. When the ceiling was introduced, the figure was 90 percent. The proposal would also removes the provision capping payouts at 12-times the ceiling. Mr Ng said the current framework was unreasonable, allowing a worker at the same company for more than 20 years to be paid the same compensation as another with just 10 years on the job. Legislators Lam Heong San and Lee Chong Cheng have raised concerns over the issue earlier this year. Mr Ng said the trio’s proposed revision to the law did not need to pass through the Executive Council or with the chief executive’s approval since it was not related to “public finances” or “government policies”. The labour law says compensation can be adjusted “in accordance with the economic conditions”, he said. Previously, every proposal presented by a legislator has been rejected by the Legislative Assembly. Legislator Au Kam San said the
proposal was submitted on Thursday. Assembly president Lau Cheoc Va will determine if the proposal should be discussed in the chamber.
Photo by Manuel Cardoso
Rising bank loans for real estate
T
he latest statistics from the Monetary Authority of Macau show that new approvals of residential mortgage loans and commercial real estate loans rose significantly in May. Macau banks approved 4 billion patacas (US$500 million) worth of residential mortgage loans in May, a rise of 42.4 percent compared to April. Loans to residents increased by 48.3 percent. Loans issued to nonresidents declined by about 23 percent. Of the home mortgage loans issued, 95.5 percent were issued to residents. Residential mortgage loans using uncompleted units as collateral also rose 61.7 percent month to month to 154.5 million patacas. Commercial real estate loans in-
creased by 31.3 percent to 2 billion patacas in May, with 97 percent granted to residents, according to the Monetary Authority. By the end of May, the outstanding value of residential mortgage loans was 81 billion patacas while the loan value for commercial real estate loans was 62.9 billion patacas. The Monetary Authority report said the delinquency ratio dropped to 0.07 percent for residential mortgage loans and remained unchanged at 0.09 percent for commercial real estate loans. An earlier Business Daily report warned that bank loans might be too concentrated on properties, with real estate loans accounting for more than 80 percent of all domestic lending. X.C.
Mr Au said he was “very confident” with proposal would come before the assembly before the end of current session.
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business daily July 27, 2012
Greater china
Solar firms warn of trade war Group files china anti-dumping case in Europe
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hina’s solar firms warned of a trade war yesterday, calling on the Chinese government to respond with all means to an anti-dumping complaint filed by European competitors that they said could be a fatal blow. Ratcheting up the stakes in ongoing disputes within the industry, companies led by Germany’s SolarWorld AG on Wednesday asked the European Union to inves-
tigate claims that Chinese firms had been selling their products below market value in Europe – the world’s biggest solar market. The so-called EU ProSun group filed the anti-dumping complaint in Brussels after a similar request in the U.S. led to duties being imposed on solar imports from the Asian country. The initiative has 25 members including companies from Italy and Spain, and
Germany’s Sovello GmbH, EU ProSun President Milan Nitzschke said yesterday. “A majority of the European solar industry backs the complaint,” Mr Nitzschke said. “Chinese companies are offering their products below manufacturing costs despite their own massive losses.” The filing highlights tensions with China over its aid for wind and solar companies, which are grabbing
US$35.8 billion Value of China’s solar exports to the EU in 2011
market share from European rivals that once dominated the industry. The competition has slashed margins across the industry, cutting solar panel price in half last year and tipping more than a dozen companies into bankruptcy. “If the EU were to follow the precedent of the U.S. and launch an anti-dumping investigation on Chinese solar products, the Chinese solar industry would suffer a fatal blow,” Yingli
China stocks fall to lowest level in two y Property developers hit by speculation, govt to maintain curbs
dropped 0.5 percent to 2,126 at the close, erasing a 0.5 percent gain. The CSI 300 Index lost 0.5 percent to 2,347.49. The Shanghai index has fallen 14 percent from this year’s high on March 2 amid concern the economic slowdown is deepening. The gauge is valued at 9.5 times estimated profit, compared with the average of 17.5 since Bloomberg began compiling the data in 2006. Thirty-day volatility in the Shanghai Composite was at 14.2 yesterday, compared with this year’s average of 17.9. About 4.9 billion shares changed hands in the gauge yesterday, the lowest level since January 16.
Property ‘fine-tuning’
Vanke Co., China’s biggest listed property developer, dropped 2.1 percent yesterday
C
hina’s stocks fell to the lowest level since March 2009 as property developers were hit by an official media warning that local governments must not challenge Beijing on its restrictions on the sector, which overshadowed a State Council plan to develop the nation’s central provinces. China Vanke Co and Poly Real Estate Group Co paced declines
among developers after the official Xinhua News Agency said China must prevent local governments from weakening real-estate controls. Hunan Valin Steel Co, part-owned by the world’s biggest mill ArcelorMittal, surged to a onemonth high as the China News Service said Hunan province’s Changsha city unveiled an 829.2 billion yuan (US$130 billion)
investment plan. “Market sentiment is pretty weak and it will take a while for investors to reverse their pessimistic expectations about the economy,” said Wang Weijun, a strategist at Zheshang Securities Co in Shanghai. “We’ll probably see more stimulus packages from the government going forward.” The Shanghai Composite Index
A gauge of property stocks in the Shanghai Composite fell 1.6 percent yesterday to its lowest close since April 11. Vanke, the nation’s biggest listed property developer, dropped 2.1 percent to 8.91 yuan. Poly Real Estate, the second largest, slid 3.9 percent to 10.72 yuan. China Merchants Property Development Co. retreated 2.8 percent to 22.36 yuan. China must prevent local government “fine tuning” of property policies from leading to a weakening of controls on the real estate market, according to commentary from Xinhua on Wednesday. Finetuning policies that compromise the central government’s macro control “bottom line” on the real estate
July 27, 2012 business daily | 9
greater china Europe accounted for 74 percent of global solar installations last year
analysis
China PMI improves, commodity demand to lag
Clyde Russell Reuters market analyst
I Solar’s chief strategy officer, Wang Yiyu said. “The investigation would also trigger a whole-scale trade war between China and the EU, which would cause huge losses to both parties,” he said at a briefing by four major Chinese solar firms – Yingli, SunTech, Trina and Canadian Solar. Western solar companies have been at odds with their Chinese counterparts for years, alleging they receive lavish
credit lines to offer modules at cheaper prices, while European players struggle to refinance. Trade action in Europe could prompt China to return fire by taking similar measures against western solar companies. “We call on the Chinese government to take all necessary and resolute measures to protect the legitimate interests of the Chinese solar industry,” Mr
years market must be stopped, it said. Daiwa Securities Co said China’s property curbs are unlikely to be strengthened. The government will continue a balancing role to encourage end-user demand while suppressing investment, speculation, Daiwa analysts wrote in note. Chinese publicly traded companies are required to release first-half earnings results in July and August. Of the 885 companies in the Shanghai Composite, the 30 that reported second-quarter earnings had an average 25 percent profit decline, according to data compiled by Bloomberg. Profit rose 2.8 percent in the first quarter, the data showed. The statistics bureau is due to release June profits for industrial companies today. Profits fell 2.4 percent in the first five months this year, according to the bureau. Hunan Valin, based in southern Hunan province, surged 9.9 percent to 2.56 yuan, the highest close since June 20. Hunan Fazhan Industrial Co. jumped 10 percent to 8.92 yuan. Hunan Investment Group Co. advanced 2.7 percent to 4.97 yuan. The central region, which includes Hunan province, is of strategic importance in the nation’s development and the government will stimulate the potential for domestic demand in the central region and further explore its development, the State Council said in a statement on Wednesday after the market closed. Bloomberg
Wang said. Close to 60 percent of China’s solar exports, worth US$35.8 billion, were shipped to the EU in 2011, the four Chinese companies said. Europe accounted for 74 percent of global solar installations in 2011, according to industry association EPIA. The European Commission has 45 days to decide if it will start an investigation. Bloomberg/Reuters
Hong Kong Hong Kong stocks rose for the first time in three days yesterday. The Hang Seng Index advanced 0.1 percent to 18,892.79 at the close of trading in Hong Kong, reversing earlier losses of as much as 0.5 percent. About five companies climbed for every four that fell on the 49-member gauge. The Hang Seng China Enterprises Index of mainland companies lost 0.1 percent to 9,210.92. “Investors generally want to be optimistic,” said Marco Li, Hong Kong-based portfolio manager at Manulife Asset Management. “The major focus is earnings, if you can get some large weights saying the outlook is improving, that will turn the market higher.”
Taiwan Taiwan stocks ended 0.12 percent lower yesterday, erasing gains in early trading, with AU Optronics Corp shedding 4.74 percent after posting a worse-than-expected loss last quarter and warning of the worst-ever times for the flat-panel industry. The main TAIEX index fell 8.44 points to 6,970.69, after opening up 0.48 percent. The cement sub-index was the biggest loser, down 2.46 percent. Electronics shares were flat, with Hon Hai falling 1.71 percent. TSMC however jumped 2.28 percent. Rival UMC rose 0.83 percent after reporting earnings the previous day. Banking shares rose 0.56 percent.
t is perhaps a reflection of the parlous state of the global economy that what is essentially a negative reading on China’s industrial strength is taken by the market as a positive signal. The HSBC Flash Purchasing Managers’ Index remained below the 50-level in July, indicating activity in the world’s largest manufacturer contracted for a ninth straight month. But the fact that the index climbed to 49.5, its highest level in five months and close to the magic 50 level, is being taken as a sign that China may have turned the corner and better times are ahead. Look at the components of the flash PMI and there are both encouraging and worrying signs, pretty much what you would expect when an economy is bouncing along the bottom phase of the cycle. The output sub-index rose to 51.2, its highest since October last year, and both new orders and new export orders improved. The big worry was the employment index, which fell further below 50 to its lowest since March 2009. However, this may be the best sign of a turning point for Chinese manufacturing since it was after March 2009 that both the HSBC and official PMIs really started accelerating after the 2008 global financial crisis and industrial output started to grow strongly. So, if China is at the bottom of its economic cycle and is poised for better things from the fourth quarter onwards, does this mean its appetite for commodities will pick up again? The answer is ultimately yes, since strong economic growth will increase demand for industrial metals and crude oil.
The big picture But the cautionary note is that this may take some time to actually show up in figures because of what was unusually strong imports in the first half. Crude oil imports gained 11 percent in the first half of this year over the same period in 2011, a jump at odds with an economy where the growth rate was slowing. However, the data also show that about 625,000 barrels per day (bpd) went into storage, most likely as the Chinese took precautions against a loss of Iranian supplies and a potentially tight oil market. That the oil market remains well supplied and able to cope with the loss of about 1.2 million bpd of Iranian exports means the Chinese may be less inclined to store as much in the second half, meaning any growth in imports will have to be led by actual demand. Implied demand, which is calculated by taking refinery runs
and net fuel imports, rose a paltry 0.5 percent in June from a year earlier, and at 9.041 million bpd was below the 12-month moving average of 9.324 million bpd. The International Energy Agency expects China’s oil product demand to rise 3.9 percent to 9.758 million bpd, which means the second half would have see implied demand reach close to 10 million bpd, which seems a hard ask even if the economy regains momentum. Similar dynamics are at work with iron ore and copper, which both saw strong import growth in the first half. For iron ore, where imports gained 9.7 percent from the first half of 2011, the story was one of traders buying cargoes in anticipation of rising steel demand, which didn’t quite materialise.
Look at the components of the flash PMI and there are both encouraging and worrying signs, pretty much what you would expect when an economy is bouncing along the bottom phase of the cycle
This means there is likely an overhang of the steel-making ingredient in the market that will take a few months to work through. Again, assuming the Chinese authorities stimulus measures lead to sustainable growth, the iron ore picture may brighten by the end of the year. In copper, imports were also strong, most likely as inventories got shifted to bonded warehouses in Shanghai from London Metals Exchange facilities. Like iron ore and crude, imports are likely to have run ahead of actual demand, meaning even an improving economy will take some time to make inroads into stockpiles.
10 |
business daily July 27, 2012
asia
South Korea economic growth cools InBrief As investment dipped and exports sector Japan eyes US$13b was hurt by the eurozone debt crisis for growth strategy The Japanese government plans to set aside US$13 billion in next year’s budget to promote its growth strategy, while keeping new borrowing and general spending unchanged from this year, the Nikkei business daily reported yesterday. The government aims to allocate about 1 trillion yen (US$12.8 billion) in the budget for the year starting next April to drive its revitalisation plan, with a focus on medicine, energy, the environment and agriculture.
Nintendo advances after narrowing loss Nintendo Co, the world’s largest maker of video-game machines, rose the most in a month in Osaka trading after the company narrowed its first-quarter loss on lower advertisement costs. The shares rose as much as 3.3 percent, the biggest intraday gain since June 21, to 8,420 yen (US$107.6). They ended at 8,410 yen, up 3.2 percent. That cut the Kyoto-based company’s year-todate loss to 21 percent. Nintendo narrowed the net loss to 17.2 billion yen (US$220 million) in the three months ended June 30 from 25.5 billion yen a year earlier.
S
outh Korea’s economy grew at the slowest pace in almost three years as Europe’s debt crisis curbs export growth in Asia and prompts policy makers from Japan to Thailand to consider further easing. Gross domestic product expanded 2.4 percent in the three months through June from a year earlier, the Bank of Korea said yesterday. That compares with the median 2.5 percent estimate of 15 economists surveyed by Bloomberg News. From the previous quarter, growth was 0.4 percent. Central bank officials in Japan and Thailand indicated on Wednesday that they are ready to ease monetary policy if necessary as Spain’s borrowing costs rise and Greece risks exiting from the euro. HSBC Holdings Plc forecasts that South Korea will cut interest rates further this quarter after Governor Kim Choong Soo said that Asia’s fourth-largest economy is losing steam faster than expected. Details provided yesterday showed the economy would have shrunk by half a percent if imports did not fall
in the second quarter indicating the growth rate of 0.4 percent was little more than a statistical illusion. Imports fell 1.7 percent in the second quarter from the preceding three months, the second-worst since the 20082009 global crisis, as companies cut down investment with the eurozone’s debt crisis continuing and growth elsewhere easing. “The big tide from Europe is engulfing Asia and leaving many policy makers helpless,” said Lee Sang Jae, a senior economist at Hyundai Securities Co in Seoul. “The worst may not be over yet.” Asian stocks advanced for the first day in five after a drop in U.S. new home sales fuelled speculation the Federal Reserve may take new steps to spur growth. South Korea’s benchmark Kospi Index rose 0.7 percent.
Long recovery The world economy “has been on a bumpy road and we will see more bumps ahead,” Kim Young Bae, a Bank of Korea director- general
Nomura set to name Nagai as CEO As firm cedes top bond deal ranking amid leak scandal Takahiko Hyuga
told reporters in Seoul yesterday after GDP figures were released. “But I hope and believe that the second half will be better as Europe is muddling through.” The Bank of Korea lowered its main rate a quarter percentage point to 3 percent on July 12, the first reduction since February 2009, as it joined a global stimulus push from Europe to China. The following day, the central bank pared its 2012 growth forecast to 3 percent from 3.5 percent, the
2.4 % GDP growth in the three months through June second cut this year. “Considering exports account for about half of our economy, how can we stay immune to changes in the international landscape and the European crisis?” Bank of Korea Governor Kim said on Wednesday. Economic support measures including
plus for Nomura shares as the company explores ways to reshape itself,” said Kouichi Niwa, a Tokyo-based analyst at SMBC Nikko Securities Inc. “Still, what Nomura needs the most now is to retrieve market trust and boost earnings power.” Once the world’s biggest securities firm with a market value of US$76 billion in 1987, Tokyo-based Nomura has now slumped to a capitalisation of US$12.3 billion, about one-fourth that of Goldman Sachs Group Inc.
Domestic operations
Hyundai Q2 profit up 10 percent South Korea’s Hyundai Motor posted a 10 percent rise in quarterly net profit, meeting market forecasts, as it produced strong global sales in the face of sluggish markets in Europe and China. Hyundai, the world’s fifth-biggest car maker along with affiliate Kia Motors, reported yesterday a 2.55 trillion won (US$2.22 billion) net profit for the April to June quarter. That was up from a 2.31 trillion won net profit a year ago and up from 2.45 trillion won in the first quarter.
NZ Central Bank holds rates New Zealand’s central bank held its official cash rate (OCR) at a record low for an 11th consecutive meeting yesterday and gave no hint of any rush to alter its interest rates projection. The Reserve Bank of New Zealand (RBNZ) left the benchmark rate at 2.5 percent, where it has been since March last year, pointing to growing risk in the eurozone, tame inflation offset by earthquake rebuilding prospects. “It remains appropriate for the OCR to be held at 2.5 percent,” RBNZ Governor Alan Bollard said.
N
omura Holdings Inc. plans to name Koji Nagai, president of its domestic brokerage, as chief executive officer to succeed Kenichi Watanabe amid an insidertrading scandal, two people with knowledge of the matter said. Mr Watanabe and chief operating officer Takumi Shibata, both 59, stepped down to take responsibility for incidents in which employees leaked information about clients’ share sales to traders, two people said earlier yesterday, asking to remain anonymous before an announcement. Japan’s largest brokerage yesterday
reported first-quarter profit fell 89 percent to 1.9 billion yen (US$24.3 million). The shares rose as investors bet the biggest management shakeup in 15 years may placate clients and regulators after a CEO pay cut and penalising junior executives for the leaks failed to stem the backlash, costing Nomura its top spot managing bond sales. Mr Watanabe and Mr Shibata, architects of the purchase of Lehman Brothers Holdings Inc.’s European and Asian assets, also presided over an 83 percent slump in the stock. Mr Watanabe’s resignation “would be a
Nomura also surrendered its spot as Japan’s No. 1 bond underwriter
Koji Nagai tipped to replace Kenichi Watanabe as Nomura’s chief executive
Qantas in Emirates tie-up talks Deal could be code-sharing or revenue sharing – report
S
truggling Qantas Airways Ltd is moving closer to an alliance with Dubai’s flagship carrier Emirates, a newspaper reported yesterday, sending the Australian airline’s shares surging more than 9 percent. Any tie-up could help Qantas’ lossmaking international division by giving it access to greater numbers of passengers from Emirates’ hub in the Middle East as well as cutting
aircraft and other costs. A final form of the deal could vary from a straightforward code-share arrangement to a more global revenuesharing deal, the Australian Financial Review (AFR) reported, citing unidentified sources. There was no mention of a capital alliance. Qantas said in a statement it was in talks with number of airlines, including Emirates, about potential alliances but
said it would not give further details. “Strengthening alliance partnerships is one of the four pillars of the Qantas Group’s five-year strategy.” “A tie-up with someone like Emirates would give a bit more clarity to the international strategy,” said David Liu, head of research at ATI Asset Management, which sold Qantas shares after a loss warning in June. “The business is very challenged on a
July 27, 2012 business daily | 11
asia Canon falls most in three years As camera maker cuts full-year profit forecast
South Korean economy losing steam faster than expected
assistance for small businesses and low-income earners announced on June 28 have yet to stem a slide in confidence. Consumer sentiment dropped to the lowest level in five months in July, the Bank of Korea said yesterday. “There are increasing risks that the
expected recovery will be later or weaker than currently assumed,” Ma Tieying, an economist with DBS Bank Ltd in Singapore, said in a note before yesterday’s release. Analysts said that given the global economic situation, the Korean economy may take a long
Japan’s largest brokerage reported first-quarter profit fell by 89 percent to US$24.3 million
this month after the nation’s biggest brokerage lost business in the wake of the information leaking scandal. The firm, which underwrote the most Japanese debt in 2011, ranked No. 3 this year with 1.27 trillion yen in sales
excluding self-led deals, according to data compiled by Bloomberg. It trailed Mitsubishi UFJ Morgan Stanley Securities Co.’s 1.35 trillion yen through yesterday and Mizuho Financial Group Inc.’s 1.34 trillion
stand-alone basis and they need to get a tie-up, so the sooner that’s done, the sooner people get some sort of certainty with regards to how they are going to reduce losses in the international division,” he added.
Hub carriers are increasingly joining hands with so-called “end-of-line” carriers like Qantas. Abu Dhabi’s Etihad Airways, recently doubled its stake in Qantas rival Virgin Australia to 10 percent. Qantas shares ended 9.6 percent higher at A$1.09 in Australian trading. They slumped to an all-time low of A$0.96 last month after the company warned of mounting losses from its international operations. Credit ratings agency Moody’s added to pressure on the airline, saying in a statement that sustainable and profitable international business was a major factor for the airline’s ability to maintain an investment-grade rating over time. “A scenario involving a major tie-up
time to recover. “This is not just Korea’s problem. So it’s hard to say when exactly Korea’s economy will pick up,” said Yum Sang Hoon of SK Securities. “It remains to be seen how the European problems are addressed.” Reuters/Bloomberg
yen, the data show. Mr Nagai, 53, replaced Watanabe on April 1 as president of Nomura Securities Co. in an effort to reduce the CEO’s domestic role and revitalise operations abroad. Mr Nagai had been deputy president of the domestic unit. Nomura climbed 5.7 percent to close at 259 yen (US$3.3) in Tokyo before the earnings were announced, while the benchmark Topix Index rose 1.2 percent. The profit for the three months ended June 30 beat the 1.6 billion yen median estimate of nine analysts Bloomberg News surveyed by phone and e-mail. Chief financial officer Junko Nakagawa apologized for the company’s involvement in leaking insider information to traders while speaking to reporters in Tokyo yesterday. Under Mr Watanabe, the company posted a record 708 billion yen loss in the year ended March 2009, oversaw the exodus of former Lehman Brothers bankers, sold new shares twice to boost capital, and cut dividends. The stock’s more than 80 percent drop since he took the post in April 2008 compares with a 41 percent decline in the Topix.
Canon Inc., the world’s largest camera maker, plunged the most in more than 13 years in Tokyo trading after cutting its full-year profit forecast because of a stronger yen and expectations for weaker global growth. The shares declined as much as 14 percent to 2,308 yen (US$29.5), the biggest intraday drop since October 9, 1998. It ended 7.8 percent down at 2,470 yen, a 40-month low. The Nikkei gained 0.9 percent to close at 8,443.10. Canon shares have declined 28 percent this year. Net income may total 250 billion yen (US$3.2 billion) in 2012, the Tokyo-based company said on Wednesday, paring its April projection of 290 billion yen because of expectations for weaker growth in the U.S., Europe and China. Chief financial officer Toshizo Tanaka cited a stronger yen and lower sales estimates for compact cameras and laser printers as the main reasons for forecasting a smaller profit. “Even as the worsening macro economy and a stronger yen were expected to damage Canon’s earnings, an intensifying competition in laser printers was unexpected,” Tetsuya Wadaki, an analyst at Nomura Securities Co, said in a report yesterday. A new mirrorless camera model, which Canon unveiled July 23, not improving sales estimates also was a surprise, he said.
2700 2650 2600 2550 2500 2450 2400 2350 2300
with a Middle East or Southeast Asian based, hub carrier could alleviate some of the strategic disadvantages that Qantas faces as an end-of-line carrier,” it said. AFR said if a deal is reached, Qantas will route many of its international flights through Dubai rather than Singapore, and will rely on its new partner to ferry customers to some European destinations, as well as the Middle East and parts of Africa. Qantas would also pull out of its Frankfurt base, leaving London as its only port in mainland Europe, with the proposed deal likely to see an end to Qantas’s existing relationship with British Airways, it said.
Mr Wadaki cut his price target for the stock 8 percent to 3,779 yen. Hisashi Moriyama, an analyst at JPMorgan Chase & Co, reduced his price estimate for the stock 12 percent to 2,200 yen, while Goldman Sachs analyst Toshiya Hari lowered his target price 3 percent to 3,600 yen. Sales at the office-equipment division, Canon’s biggest, may drop 5.2 percent to 1.8 trillion yen this year, the company said, abandoning an earlier forecast for 1.1 percent growth. Imaging-systems sales may rise at a 17 percent pace, slower than the 20 percent it previously forecast. The target for compact-camera sales this year was lowered to 21 million units from the 22 million forecast earlier, according to the statement. The company kept the sales target for single-lens reflex cameras, used by professionals, unchanged at 9.2 million units. Canon’s revised profit forecast lagged behind the 289.6 billion-yen average estimate of 20 analysts, according to data compiled by Bloomberg. The company also reported secondquarter net income of 51.7 billion yen, also missing analyst estimates for 67.6 billion yen.
Reuters
Bloomberg
Bloomberg
12 |
business daily July 27, 2012
MARKETS Hang SENG INDEX NAME
NAME
PRICE
Day %
VOLUME
CHINA UNICOM HON
11.24
2.367942
66747614
CITIC PACIFIC
10.74
1.129944
2028911
PRICE
Day %
VOLUME
AIA GROUP LTD
26.8
0.5628518
15873912
ALUMINUM CORP-H
3.03
-0.3289474
7984468
BANK OF CHINA-H
2.85
0.7067138
163026854
BANK OF COMMUN-H
4.83
-1.02459
13932100
BANK EAST ASIA
25.85
-0.5769231
BELLE INTERNATIO
13.04
0.1536098
BOC HONG KONG HO
23.15
-0.4301075
6915443
HANG LUNG PROPER
CATHAY PAC AIR
12.68
0.7949126
2026800
HANG SENG BK
CHEUNG KONG
98.1
0
2574803
HENDERSON LAND D
CHINA COAL ENE-H
6.43
-0.7716049
15787639
CHINA CONST BA-H
CLP HLDGS LTD
NAME
PRICE
Day %
59.3
0.08438819
2484594
SANDS CHINA LTD
21.15
-4.94382
40033049
SINO LAND CO
12.42
0.1612903
6187403
94
-0.265252
3102001
89.3
0.3370787
962166
-0.8896797
3020007
POWER ASSETS HOL
VOLUME
65
0.231303
2433650
CNOOC LTD
14.82
0.270636
47194111
1242356
COSCO PAC LTD
10.16
2.110553
3432028
SWIRE PACIFIC-A
4913972
ESPRIT HLDGS
8.97
0.7865169
6166853
TENCENT HOLDINGS
222.8
25.5
-0.1956947
2871438
TINGYI HLDG CO
19.02
0.1052632
3988111
105.4
-0.5660377
1017785
WANT WANT CHINA
9.18
0.6578947
7708782
42.75
-1.724138
3946636
WHARF HLDG
42.8
1.062574
2949167
70
0.07147963
4146368
HONG KG CHINA GS
17.52
-0.2277904
4262985
HONG KONG EXCHNG
100.3
-1.279528
4413500
HSBC HLDGS PLC
62.5
0.4016064
14103607
HENGAN INTL
4.84
-0.8196721
192655806
CHINA LIFE INS-H
20.85
0
18520043
CHINA MERCHANT
22.8
0.2197802
2978304
CHINA MOBILE
87.75
0.6307339
12824664
HUTCHISON WHAMPO
66.8
-0.7429421
5144565
CHINA OVERSEAS
17.48
2.944641
41559918
IND & COMM BK-H
4.13
-0.4819277
163084932
SUN HUNG KAI PRO
MOVERS
27
20
2 19080
INDEX 18892.79
CHINA PETROLEU-H
6.67
-1.331361
86209186
LI & FUNG LTD
14.38
3.751804
21798282
HIGH
19078.31
CHINA RES ENTERP
19.14
-0.1043841
3032421
MTR CORP
26.45
-0.1886792
968572
LOW
18744.98
CHINA RES LAND
14.86
0.8141113
9831566
NEW WORLD DEV
9.52
0.1051525
8650753
CHINA RES POWER
15.96
0.3773585
7711938
52W (H) 22808.33
PETROCHINA CO-H
9.38
0.7518797
50502812
CHINA SHENHUA-H
27.45
1.104972
11160239
PING AN INSURA-H
58.8
-0.7594937
8385848
(L) 16170.35
18740
24-Jul
26-Jul
Hang SENG CHINA ENTErPRISE INDEX NAME
NAME
PRICE
DAY %
VOLUME
24.95
0.2008032
13109042
YANZHOU COAL-H
CHINA PETROLEU-H
6.67
-1.331361
86209186
ZIJIN MINING-H
7984468
CHINA RAIL CN-H
6.95
0.1440922
13364664
ZOOMLION HEAVY-H
7208091
CHINA RAIL GR-H
3.36
-2.040816
21848884
ZTE CORP-H
CHINA SHENHUA-H
27.45
1.104972
11160239
PRICE
DAY %
VOLUME
AGRICULTURAL-H
2.99
-0.3333333
40845121
CHINA PACIFIC-H
AIR CHINA LTD-H
5.41
3.244275
16658108
ALUMINUM CORP-H
3.03
-0.3289474
ANHUI CONCH-H
19.3
0
BANK OF CHINA-H
2.85
0.7067138
163026854
4.83
-1.02459
13932100
CHINA TELECOM-H
3.91
-0.7614213
69294152
12.98
-1.666667
1912969
DONGFENG MOTOR-H
10.2
1.190476
11147211
CHINA CITIC BK-H
3.65
-1.084011
15818935
GUANGZHOU AUTO-H
5.48
-1.083032
2084210
CHINA COAL ENE-H
6.43
-0.7716049
15787639
HUANENG POWER-H
5.51
0.5474453
23512166
CHINA COM CONS-H
6.72
-0.2967359
11028530
IND & COMM BK-H
4.13
-0.4819277
163084932
CHINA CONST BA-H
4.84
-0.8196721
192655806
JIANGXI COPPER-H
16.66
0.969697
4896145
BANK OF COMMUN-H BYD CO LTD-H
CHINA COSCO HO-H CHINA LIFE INS-H CHINA LONGYUAN-H CHINA MERCH BK-H
3.25
-0.3067485
5622384
PETROCHINA CO-H
9.38
0.7518797
50502812
20.85
0
18520043
PICC PROPERTY &
8.48
2.045728
17448028
4.7
1.075269
1960009
PING AN INSURA-H
58.8
-0.7594937
8385848
13.58
-0.8759124
11814433
SHANDONG WEIG-H
8.39
0.7202881
4263534
CHINA MINSHENG-H
6.72
0.5988024
18536530
SINOPHARM-H
20.45
-0.2439024
753303
CHINA NATL BDG-H
7.12
-0.6973501
31142244
TSINGTAO BREW-H
44
-2.113459
2339985
CHINA OILFIELD-H
11.8
1.724138
2708747
WEICHAI POWER-H
21.45
-2.277904
2138776
NAME
MOVERS
15
PRICE
DAY %
11.04
-0.5405405
7936182
2.34
2.183406
32994823
8.4
2.564103
41403824
10.26
-0.7736944
8424853
22
VOLUME
3 9300
INDEX 9210.92 HIGH
9297.1
LOW
9128.49
52W (H) 12651.92 (L) 8058.58
9120
24-Jul
26-Jul
Shanghai Shenzhen CSI 300 NAME
PRICE
DAY %
VOLUME
PRICE
DAY %
VOLUME
AGRICULTURAL-A
2.45
0
24477789
DAQIN RAILWAY -A
6
-0.4975124
21168565
AIR CHINA LTD-A
5.92
-2.47117
9967400
DATANG INTL PO-A
5.02
-1.375246
4912881
ALUMINUM CORP-A
6.01
0
7301774
DONGFANG ELECT-A
15.88
-3.523694
12412348
14.21
-0.698812
7540777
EVERBRIG SEC -A
13.45
0
ANHUI CONCH-A
NAME
NAME
PRICE
DAY %
VOLUME
12.8
1.506741
16309912
SANY HEAVY INDUS
11.59
-0.3439381
16146154
SHANDONG GOLD-MI
32.68
1.585328
7894449
7842587
SHANG PHARM -A
11.21
2.749771
23782159
SAIC MOTOR-A
BANK OF BEIJIN-A
7.32
0.2739726
7469654
GD MIDEA HOLDING
9.44
-0.1058201
18923429
SHANG PUDONG-A
7.4
-0.1349528
30350495
BANK OF CHINA-A
2.69
0
7396142
GD POWER DEVEL-A
2.67
-1.476015
31930026
SHANGHAI ELECT-A
4.25
-0.9324009
1969646
BANK OF COMMUN-A
4.18
0.7228916
27518657
GF SECURITIES-A
14.98
-1.252472
17156582
SHANXI LU'AN -A
20.41
1.039604
6549238
BANK OF NINGBO-A
9.74
-0.408998
7833523
GREE ELECTRIC
21.21
-0.5625879
8034771
SHANXI XINGHUA-A
35.48
-4.314995
6598946
BAOSHAN IRON & S
4.16
1.216545
19743666
GUANGHUI ENERG-A
13.08
-0.6079027
6591528
SHANXI XISHAN-A
14.58
-0.6811989
9373186
16.59
0.3629764
6924903
SHENZ DVLP BK-A
14.65
0.06830601
7290309
41470576
SHENZEN OVERSE-A
5.85
-4.5677
66728694
BYD CO LTD -A CHINA CITIC BK-A
15.3
-6.134969
10994836
GUIZHOU PANJIA-A
3.8
0.5291005
8097240
HAITONG SECURI-A
9.6
-2.040816
HANGZHOU HIKVI-A
28.61
2.178571
4645257
SUNING APPLIAN-A
6.41
-3.609023
103285440
2.6
1.167315
18343504
TSINGTAO BREW-A
35.96
0.6718925
1046898
HENAN SHUAN-A
61.88
-2.551181
1541666
WEICHAI POWER-A
22.83
-2.101201
7950075
HONG YUAN SEC-A
18.18
-0.219539
21894251
WULIANGYE YIBIN
35.33
0.08498584
23216212 9786045
CHINA CNR CORP-A
3.66
-0.5434783
15363587
CHINA COAL ENE-A
7.48
0.1338688
4816544
CHINA CONST BA-A
3.87
0
12254926
CHINA COSCO HO-A
4.38
-0.9049774
8455788
HEBEI IRON-A
CHINA CSSC HOL-A
22.06
-1.911961
3019013
HUATAI SECURIT-A
9.87
-6.267806
23883940
YANGQUAN COAL -A
15.15
0.464191
CHINA EAST AIR-A
4.11
-0.7246377
7992761
HUAXIA BANK CO
8.37
-0.238379
14958882
YANTAI CHANGYU-A
61.42
0.1467471
855567
CHINA EVERBRIG-A
2.71
0.3703704
14289259
IND & COMM BK-A
3.67
0
15717093
YANTAI WANHUA-A
12.98
-2.771536
7837998
19.49
-1.06599
12384164
INDUSTRIAL BAN-A
11.9
-0.3350084
19812950
YANZHOU COAL-A
18.45
-0.05417118
1955795
CHINA MERCH BK-A
9.59
0.1043841
29695836
INNER MONG BAO-A
38.75
0.2846791
23946812
YUNNAN BAIYAO-A
60.56
-1.094235
1259938
CHINA MERCHANT-A
11.38
-0.8710801
6546736
INNER MONG YIL-A
19.13
-1.391753
10177264
ZHONGJIN GOLD
21.18
1.097852
7463516
CHINA MERCHANT-A
22.36
-2.782609
7769772
INNER MONGOLIA-A
5.13
6.431535
103007830
ZIJIN MINING-A
3.73
1.084011
35634128
9.16
0.5488474
25169749
11.34
0.7104796
11924049
CHINA LIFE INS-A
CHINA MINSHENG-A
5.77
-0.5172414
52589900
JIANGSU HENGRU-A
29.92
-1.643655
2607627
ZOOMLION HEAVY-A
CHINA NATIONAL-A
5.84
-1.351351
13826739
JIANGSU YANGHE-A
143.6
-1.939361
1397452
ZTE CORP-A
CHINA OILFIELD-A
17.1
-2.564103
4878437
JIANGXI COPPER-A
21.62
0.2318034
4583288
CHINA PACIFIC-A
22.89
0.9259259
16680221
JINDUICHENG -A
12.31
-1.283079
5423695
6.07
0.3305785
13595350
JIZHONG ENERGY-A
14.43
0.2779708
9643153
15.3
-2.298851
13272831
250.44
-1.999609
2341879
CHINA PETROLEU-A CHINA RAILWAY-A
4.78
-0.6237006
15689706
KANGMEI PHARMA-A
CHINA RAILWAY-A
2.61
-1.509434
19254898
KWEICHOW MOUTA-A
CHINA SHENHUA-A
21.66
-0.09225092
6629480
LUZHOU LAOJIAO-A
40.68
-0.02457606
5118318
29363597
METALLURGICAL-A
2.29
0
7939704
MOVERS
97
180
23 2390
INDEX 2347.488
CHINA SHIPBUIL-A
4.85
-0.2057613
CHINA SOUTHERN-A
4.34
-1.363636
16085300
NINGBO PORT CO-A
2.49
-0.4
8267159
CHINA STATE -A
3.18
0
40735758
PANGANG GROUP -A
3.76
1.347709
83463247
HIGH
2384.73
CHINA UNITED-A
3.7
-0.2695418
84041829
PETROCHINA CO-A
8.82
-0.5636979
6609089
LOW
2353.22
CHINA VANKE CO-A
8.91
-2.087912
54631095
PING AN INSURA-A
44.7
0
16492337
CHINA YANGTZE-A
6.48
0.1545595
5991870
POLY REAL ESTA-A
10.72
-3.856502
68032183
CITIC SECURITI-A
12.22
0.1639344
44057710
QINGDAO HAIER-A
10.88
-0.5484461
5478302
CSR CORP LTD -A
4.19
-2.102804
20857838
QINGHAI SALT-A
35.42
-1.199442
9215495
52W (H) 3002.691 (L) 2254.567
2340
24-Jul
26-Jul
FTSE TAIWAN 50 INDEX NAME
PRICE DAY %
Volume
PRICE DAY %
Volume
ACER INC
29.5 -0.5059022
13907119
NAME FORMOSA PLASTIC
78.9 -0.1265823
5425405
TAIWAN MOBILE CO
97.4
1.458333
FOXCONN TECHNOLO
98.1
-2.38806
7864373
TPK HOLDING CO L
403
-1.104294
4689473
-1.215278
17562145
TSMC
80.6
1.896334
40984054
ADVANCED SEMICON
27.05
-2.34657
23744561
ASIA CEMENT CORP
33.65
1.355422
2856455
FUBON FINANCIAL
28.45
ASUSTEK COMPUTER
283.5
0
6094057
HON HAI PRECISIO
85.3
-1.954023
31909070
AU OPTRONICS COR
11.9
0.4219409
34335405
HOTAI MOTOR CO
181
0.2770083
374100
NAME
PRICE DAY %
UNI-PRESIDENT
45.45
-0.87241
6214870
12.55
-1.568627
66087428
39.15
-1.633166
19702822
12.7
1.195219
12754473
47.95 -0.7246377
4148969
CATCHER TECH
180.5
1.120448
14127338
HTC CORP
430
1.775148
8979263
WISTRON CORP
28.65
0.5263158
11610480
HUA NAN FINANCIA
15.8
0.3174603
6824711
YUANTA FINANCIAL
CHANG HWA BANK
15.2 -0.6535948
9301996
LARGAN PRECISION
564
1.438849
1833160
YULON MOTOR CO
CHENG SHIN RUBBE
71.6
2426669
LITE-ON TECHNOLO
34
-1.449275
8395640
CHIMEI INNOLUX C
21084961
MEDIATEK INC
256.5
1.383399
4567683
6.96
-1.276596
54967646
MEGA FINANCIAL H
19.95
-2.682927
41224858
28
0
15320577
NAN YA PLASTICS
55.6
-1.59292
7268424
16.25
-3.560831
63006271
PRESIDENT CHAIN
155 -0.3215434
91.4
0.109529
6055804
QUANTA COMPUTER
77.9
0.1285347
COMPAL ELECTRON
31.4
0.6410256
5773797
SILICONWARE PREC
30.1
-2.272727
7381841
DELTA ELECT INC
83.3
-5.340909
13438269
SINOPAC FINANCIA
9.59 -0.1041667
10323142
30.95 -0.8012821
7067959
SYNNEX TECH INTL
67.8
0.1477105
2257128
1.917404
3663018
TAIWAN CEMENT
32.7 -0.6079027
6782289
16.45 -0.9036145
13515186
CHINA DEVELOPMEN CHINA STEEL CORP CHINATRUST FINAN CHUNGHWA TELECOM
FAR EASTERN NEW FAR EASTONE TELE FIRST FINANCIAL
12.05 -0.8230453
69.1
TAIWAN COOPERATI
FORMOSA CHEM & F
78.6
0.3831418
5065157
TAIWAN FERTILIZE
FORMOSA PETROCHE
83.4
1.090909
1372719
TAIWAN GLASS IND
17.25
938447 14415132
0.2906977
4092613
66.7 -0.7440476
2629106
27.65
0.3629764
928247
5130604
UNITED MICROELEC
CATHAY FINANCIAL
0.4207574
Volume
MOVERS
23
25
2 4800
INDEX 4743.14 HIGH
4794.76
LOW
4741.66
52W (H) 5960.61 (L) 4643.05
4740
24-Jul
26-Jul
July 27, 2012 business daily | 13
MARKETS GAMING STOCKS - DAILY PERFORMANCE (Hong Kong Stock Exchange) galaxy entertainMent
Max 17.62
average 17.380
Melco crown entertainMent
Min 16.98
last 17.54
17.7 17.6 17.5 17.4 17.3 17.2 17.1 17.0 16.9
sanDs china ltD
MgM china holDings 24.60
10.3 24.55
Max 24.55
average 24.55
Min 24.55
last 24.55
Min 20.8
last 21.15
20.8
PRICE
10.0
15.2
15.0
13.6 13.5
14.8
13.4 13.3 Max 13.74
average 13.552
DAY %
YTD %
(H) 52W
(L) 52W
WTI CRUDE FUTURE Sep12
88.15
-0.921658986
-10.84252048
110.8699951
77.69999695
BRENT CRUDE FUTR Sep12
103.59
-0.756849971
-1.267632482
124.1999969
88.90999603
GASOLINE RBOB FUT Aug12
278.54
-0.268538079
3.662076665
326.7099857
243.0099964
GAS OIL FUT (ICE) Sep12
893.25
0.789844852
-0.611961057
1046.5
798.5
3.05
-0.651465798
-6.898656899
4.728000164
2.174999952
NATURAL GAS FUTR Aug12 HEATING OIL FUTR Aug12
282.69
-0.601265823
-0.590779618
332.949996
250.8399963
Gold Spot $/Oz
1602.8
0.6247
2.4212
1921.18
1522.75
Silver Spot $/Oz
27.3025
0.6729
-1.9131
44.2175
26.085
Platinum Spot $/Oz
1399.8
0.2291
0.3801
1915.75
1339.25
Palladium Spot $/Oz
565.02
-0.2753
-13.5394
848.37
537.54
LME ALUMINUM 3MO ($)
1870
0.053504548
-7.425742574
2675.25
1832.25
LME COPPER 3MO ($)
7446
0.390993663
-2.026315789
9905
6635
LME ZINC
1801
0.222593211
-2.384823848
2539.5
1718.5
15875
0.793650794
-15.15232496
25195
15450
15.55
-0.096370061
3.459747172
18
13.95499992
783.75
-0.539340102
33.68869936
800
499
3MO ($)
LME NICKEL 3MO ($) AGRICULTURE ROUGH RICE (CBOT) Sep12 Dec12
WHEAT FUTURE(CBT) Sep12
Min 13.32
14.6
last 13.42
Max 15.1
average 14.758
last 14.78
Min 14.64
PRICE MAJORS
ASIA PACIFIC
CROSSES
AUD GBP CHF EUR JPY MOP HKD CNY INR THB SGD TWD PHP IDR AUDJPY EURCHF EURGBP EURCNY EURMOP EURJPY HKDMOP
MACAU RELATED STOCKS (L) 52W
3.25
1.88
2220677
150.0999908
CROWN LTD
8.33
0.3614458
2.966624
9.29
7.45
636369
26.03999901
19.23999977
AMAX HOLDINGS LT
0.062
-3.125
-28.73563
0.119
0.055
1830000
102.25
64.61000061
BOC HONG KONG HO
23.15
-0.4301075
25.81522
24.45
14.24
6915443
CENTURY LEGEND
0.234
0
1.739129
0.35
0.204
0
3
0
7.142859
3.95
2.3
0
CHINA OVERSEAS
17.48
2.944641
34.66873
19.16
9.99
41559918
CHINESE ESTATES
8.98
0
-28.16
13.68
8.3
59269
CHOW TAI FOOK JE
8.5
-2.522936
-38.93678
15.16
8.4
11230000
EMPEROR ENTERTAI
1.38
1.470588
24.32432
1.84
0.97
710000
FUTURE BRIGHT
1.03
5.102041
145.2381
1.09
0.3
3312000
COFFEE 'C' FUTURE Sep12
176.6
0.170164492
-24.61045891
288.8500061
SUGAR #11 (WORLD) Oct12
23.12
-1.909206619
1.270258432
COTTON NO.2 FUTR Dec12
70
0.704934542
-20.30965392
NAME
PRICE
CHEUK NANG HLDGS
World Stock MarketS - Indices (H) 52W
(L) 52W
DOW JONES INDUS. AVG
US
12676.05
0.4654713
3.752716
13338.66016
10404.49
NASDAQ COMPOSITE INDEX
US
2854.24
-0.3056245
9.561449
3134.17
2298.89
FTSE 100 INDEX
GB
5484.36
-0.2538957
-1.577809
5989.07
4791.01
DAX INDEX
GE
6340.79
-1.025986
7.50108
7382.8
4965.8
NIKKEI 225
JN
8443.1
0.9227937
-0.1448787
10255.15
8135.79
17.54
-2.771619
23.17416
24.95
8.69
26068245
105.4
-0.5660377
14.37873
124.3
84.4
1017785
HOPEWELL HLDGS
21.9
-1.351351
10.2719
24.903
18.56
958200
HSBC HLDGS PLC
62.5
0.4016064
5.932203
78.6
56
14103607
HUTCHISON TELE H
3.74
0
25.08361
3.86
2.53
3344000
LUK FOOK HLDGS I
17.42
4.939759
-35.71956
46.15
14.7
3533380
MELCO INTL DEVEL
5.22
-2.06379
-9.532062
10.76
4.3
2444000
MGM CHINA HOLDIN
10.1
-3.441683
5.294395
17.183
7.6
6899320
18892.79
0.08189718
2.486648
22808.33
16170.35
CSI 300 INDEX
CH
2347.488
-0.5336677
0.07443674
3002.691
2254.567
TAIWAN TAIEX INDEX
TA
6970.69
-0.120932
-1.433668
8819.929688
6609.11
MIDLAND HOLDINGS
KOSPI INDEX
SK
1782.47
0.7437928
-2.369999
2174.73
1644.11
NEPTUNE GROUP
S&P/ASX 200 INDEX
AU
4147.733
0.5767775
2.247529
4582.7
3765.9
ID
4004.776
0.09840436
4.782426
4234.734
3217.951
MA
1623.91
-0.6837544
6.087296
1647.94
1310.53
NZX ALL INDEX
NZ
777.987
0.7951027
6.602726
806.015
PHILIPPINES ALL SHARE IX
PH
3434.22
-0.06140272
12.78078
HSBC Dragon 300 Index Singapor
SI
573.94
-0.26
15.64
TH
HO CHI MINH STOCK INDEX
VN
Laos Composite Index
LO
1172.92
-1.320859
14.39552
414.8
0.4577269
1003.33
-0.8880591
VOLUME CRNCY
HANG SENG BK
HK
FTSE Bursa Malaysia KLCI
DAY % YTD %
GALAXY ENTERTAIN
HANG SENG INDEX
STOCK EXCH OF THAI INDEX
0.9388 1.5235 0.7071 1.2043 75.35 7.9823 7.7526 6.2769 44.0125 29.68 1.1999 28.773 41.57 8458 72.057 1.00749 0.77553 7.7018 9.6245 94.12 1.0288
(H) 52W
606.75 1115.75
YTD %
(L) 52W
1.1076 1.6618 0.9972 1.4549 84.18 8.0449 7.8113 6.4474 57.3275 32 1.3199 30.716 44.35 9662 88.637 1.24736 0.88861 9.2878 11.6793 114.18 1.0311
8.181816
947.25 1691.5
DAY %
(H) 52W
1.0971 -0.2123 -5.252 -6.4193 -1.5363 0.1214 0.1315 -1.3957 -5.3003 -0.4104 3.2407 0.5446 4.0095 -4.567 -2.7055 1.3198 6.573 5.0428 6.8351 5.1932 0.0097
-6.299213
27.039544 31.88706664
PRICE
YTD %
0.3695 0.0581 -0.1212 -0.1317 0.1792 0.0063 0.0052 0.0689 0.2231 0.0316 0.1911 0.2258 -0.0356 0.0526 -0.1886 0.0058 0.188 -0.0788 0.1579 0.3061 0
2.38
-1.300858013 -1.686784277
COUNTRY
DAY %
1.0321 1.551 0.9901 1.2129 78.11 7.9899 7.7572 6.3841 56.035 31.68 1.2559 30.115 42.15 9503 80.613 1.20094 0.78199 7.7437 9.6897 94.74 1.03
ARISTOCRAT LEISU
891.5 1588.25
SOYBEAN FUTURE Nov12
JAKARTA COMPOSITE INDEX
last 10.1
CURRENCY EXCHANGE RATES
NAME
NAME
Min 10.04
13.7
Commodities
CORN FUTURE
average 10.151
13.8
21.0
METALS
Max 10.4
wynn Macau ltD
21.2
ENERGY
24.50
sJM holDings ltD 21.4
average 21.068
10.2 10.1
21.6
Max 21.7
10.4
4.2
2.439024
6.220286
5.217
2.887
2540000
0.168
0
51.35135
0.205
0.08
25590000
NEW WORLD DEV
9.52
0.1051525
52.07667
10.96
6.13
8650753
SANDS CHINA LTD
21.15
-4.94382
-3.64465
33.05
14.9
40033049
SHUN HO RESOURCE
1.13
0
13
1.32
0.82
0
SHUN TAK HOLDING
2.67
0.3759398
4.332402
4.668
2.241
1765750
700.441
SJM HOLDINGS LTD
13.42
-3.453237
7.312473
20.711
10.079
13223600
3527.48
2695.06
SMARTONE TELECOM
16.76
4.358655
24.70238
18.5
9.8
2154491
na
na
WYNN MACAU LTD
14.8
-3.014417
-24.10256
27.48
14.62
7688450
ASIA ENTERTAINME
3.15
-1.253918
-46.42857
10.8692
3.14
80229
BALLY TECHNOLOGI
43.42
-3.596803
9.757327
49.32
24.74
1523671
BOC HONG KONG HO
3.05
-0.6514658
27.23244
3.15
1.81
17000
GALAXY ENTERTAIN
2.33
0
24.59893
3.24
1.08
4905
INTL GAME TECH
11.76
-19.94554
-31.62791
19.15
11.53
30413626
JONES LANG LASAL
65.06
-0.2300261
6.203072
92.77
46.01
368415
LAS VEGAS SANDS
37.51
-2.292264
-12.21624
62.09
36.08
21778614
MELCO CROWN-ADR
9.48
1.227977
-1.4553
16.15
7.05
4325181
MGM CHINA HOLDIN
1.47
0
23.3539
2.2131
1.0025
500
MGM RESORTS INTE
9.2
-2.12766
-11.79291
16.05
7.4
10408806 591027
1247.72
843.69
17.99175
492.44
332.28
11.54804
1075.53
876.33
Shanghai Shenzhen Composite index is listing the biggest companies by market capitalization. All data supplied by Bloomberg unless otherwise indicated.
SHUFFLE MASTER
15.14
-0.8513425
29.18088
18.77
7.35
SJM HOLDINGS LTD
1.78
-3.783784
10.72593
2.6037
1.2624
500
WYNN RESORTS LTD
92.79
-0.2258065
-16.01955
158.1477
91.58
1725870
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business daily July 27, 2012
Opinion Bungled bank bailout leaves behind righteous anger (Part II) Neil M. Barofsky
Former special inspector for the Troubled Asset Relief Program and senior fellow at New York University’s School of Law
More rescues More important, the financial markets continue to bet that the government will once again come to the big banks’ rescue. Creditors still give the largest banks more favourable terms than their smaller counterparts – a direct subsidy to those that are already deemed too big to fail, and an incentive for others to try to join the club. Similarly, the major banks are given better credit ratings based on the assumption that they will be bailed out. As a result, the market distortions that flow from the presumption of bailout may have gotten worse. By failing to alter this presumption, Dodd-Frank may have inadvertently sowed the seeds for the next financial crisis. Although there have been calls to break up the biggest banks, the Financial Stability Oversight Council has still taken no significant action to limit their size or power, and has only just begun to make noises about bringing nonbank financial institutions (such as American International Group Inc.) under its jurisdiction. Even basic steps such as creating and implementing the new rules have lagged, with two-thirds of Dodd-Frank’s rulemaking deadlines blown by May 1, 2012. And in some instances, the regulators have taken a step backward. For example, one of the best protections against future bailouts is to ensure that banks have thick capital cushions that can absorb potential losses. Although Dodd-Frank called for higher capital levels to be set by the regulators for the largest banks, they still haven’t formally done so. Worse, the Federal Reserve authorised 15 of the 19 largest bank holding companies to drain their capital through cash payouts in the form of dividends to their shareholders and share repurchases. These actions benefit the banks’ senior executives, who own large amounts of stock, and increase the risk to the taxpayer that the banks will once again have to be bailed out.
Diluted rules The banks have also been gaming and watering down the rules and regulations. One of the best examples is with respect to the Volcker rule, which is supposed to prohibit banks from making risky proprietary bets that could lead to large losses and eventual bailouts. The final version contained a number of carve-outs and exceptions that created large potential loopholes. For example, in April 2012, Bloomberg News reported that JPMorgan Chase had moved some of its soon-to-be banned
trading operations overseas into its London-based Treasury unit, branding a multi-hundred-billion-dollar trading position in synthetic credit derivatives as a “hedge”. Legitimate hedging was one of the hard-fought exemptions to the Volcker rule won by the banks, intended to permit them to minimise risk to the system by allowing them to offset specific risks from positions that may remain in their portfolios. But as the New York Times and Bloomberg reported, JPMorgan’s supposed Treasury “hedges” appeared profitdriven and were so large that they moved markets. After the articles warned that JPMorgan’s positions were potentially destabilising and were probably difficult to unwind without “causing a dislocation in the markets,” the bank’s chief executive officer, Jamie Dimon, claimed such concerns were little more than a “tempest in a teapot.” JPMorgan recently disclosed that the trade had cost it at least US$5.8 billion. Hopefully the incident will help embolden regulators to better use Dodd-Frank’s tools to clamp down on risk taking. To date, however, the response has been more accommodating. As Geithner told Congress in March 2012 when confronted with arguments similar to those made by the banks: “We’re going to look at all the concerns expressed by these rules,” he said. “It is my view that we have the capacity to address those concerns.” Words like these presumably led one of the Volcker rule’s authors, Senator Carl Levin, a Michigan Democrat, to warn that some at “Treasury are willing to weaken the law”. Indeed, words like Geithner’s, when accompanied
by actions such as the Fed’s in Internal Revenue Service rules. authorisation of the largest banks Treasury’s focus on TARP’s finanto release capital, send what should cial costs, of course, detracts from be a clear message. We may be in its significant nonfinancial costs, indanger of quickly returning to the cluding the worsening of “too big to pre-crisis status quo of inadequately fail” and the lost opportunity to help capitalised struggling homebanks that owners. But a take outsized separate cost – risks while the loss of many being coddled Americans’ faith Only with this by their overin their governaccommodating appropriate and justified ment – may still regulators. A yield a major rage can we hope for repeat of the benefit. financial crisis The missteps by the type of reform that would soon be Treasury have upon us. produced a valuwill one day break our TARP’s Losses able byproduct: As the elec- system free from the the widespread tion approachanger that may es, Treasury’s corrupting grasp of the contain the only triumphant hope for meand e c l a r a t i o n s megabanks ingful reform. of mission acAmericans complished should lose faith for TARP have in their governpicked up steam, focusing largely ment. They should deplore the capon the reduction in expected losses. tured politicians and regulators who While it is good news that the pro- distributed tax dollars to the banks gramme’s losses will be far less than without insisting that they be accountoriginally anticipated, the numbers able. The American people should be that Treasury has been publishing revolted by a financial system that reare incomplete. For example, Trea- wards failure and protects those who sury continues to offset expected drove it to the point of collapse and TARP losses by declaring the more will undoubtedly do so again. than 500 million shares of stock that Only with this appropriate and the New York Fed received in return justified rage can we hope for the for a pre-TARP bailout of AIG (AIG) type of reform that will one day break as part of “Treasury’s investment.” our system free from the corrupting Similarly, Treasury’s projections don’t grasp of the megabanks. include, or make reference to, the poBloomberg View tentially enormous losses in future tax revenue from AIG, Citigroup Inc. (C), (For editorial reasons, this article was General Motors Co., and others that published in two parts. The first was Treasury exempted through a change published in yesterday’s edition.)
editorial council Paulo A. Azevedo, Tiago Azevedo, Duncan Davidson, Emanuel Graça, Cris Jiang Founder & Publisher Paulo A. Azevedo | pazevedo@macaubusinessdaily.com Editor-in-Chief Tiago Azevedo DEputy Editor-in-Chief José I. Duarte Newsdesk Vitor Quintã (Chief Reporter) Tony Lai, Xi Chen Creative Director José Manuel Cardoso Designer Janne Louhikari Contributors Frederico Rato, Pereira Coutinho, Ricardo Siu, Rose N. Lai, Zen Udani Photography Carmo Correia, John Si, Manuel Cardoso Assistant to the publisher Laurentina da Silva | ltinas@macaubusinessdaily.com office manager Elsa Vong | elsav@macaubusinessdaily.com Agencies Bloomberg, Reuters, AFP, Xinhua, Lusa, Project Syndicate Printed in Macau by Welfare Ltd.
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July 27, 2012 business daily | 15
OPINION Business
wires Leading reports from Asia’s best business newspapers
Economic Times
Europe’s immigration challenge Peter Sutherland
Cecilia Malmstrom
Twenty-seven years after setting up a manufacturing base in India, Yamaha Motor Company will export sports bikes to Japan from India, in what is a first in the history of Indian industry. India Yamaha Motor, the subsidiary of the Japanese two-wheeler company, will be exporting its first shipment of 300 deluxe motorcycles R15, a 150cc sports bike manufactured at its plant in Surajpur. The idea is to test the product in Japan; if the response is good, the company may even begin exports of another motorcycle, FZ, to its home market.
Jakarta Globe The Indonesian government has decided to remove its 5 percent import tax on soybeans in response to a tempe and tofu sellers’ strike across a number of Indonesian cities to protest soaring soybean prices. Coordinating Minister for the Economy Hatta Rajasa announced the decision after a meeting on the issue at his office in Jakarta. He said the tariff’s removal would be temporary, until soybean prices returned to normal. Indonesia consumes 2.2 million tons of soybeans per year, but the country is only able to produce 700,000 tons per year.
Japan Times Tokyo Electric Power Co. will begin accepting claims in September for lumpsum compensation for psychological distress, unemployment and damage to nonfarm businesses caused by the meltdowns at its power plant in Fukushima Prefecture, the utility said. The announcement follows the government’s release of detailed compensation standards. Tepco will pay 100,000 yen (US$1,280) per month to each victim for psychological suffering. Five years’ worth of compensation will be paid to victims in the most contaminated of the three evacuation zones around the nuclear plant, where residents are barred from returning for at least five years.at least three years old and is well established. That’s equivalent to P3,140 per hectare.
Chairman of Goldman Sachs International and the London School of Economics, and a UN Special Representative for Migration and Development
EU Commissioner for Home Affairs and former Sweden’s Minister for Europe
E
urope faces an immigration predicament. Mainstream politicians, held hostage by xenophobic parties, adopt anti-immigrant rhetoric to win over fearful publics, while the foreign-born are increasingly marginalised in schools, cities, and at the workplace. Yet, despite high unemployment across much of the continent, too many employers lack the workers they need. Engineers, doctors, and nurses are in short supply; so, too, are farmhands and health aides. And Europe can never have enough entrepreneurs, whose ideas drive economies and create jobs. The prevailing scepticism about immigration is not wholly unfounded. Many communities are genuinely polarised, which makes Europeans understandably anxious. But to place the blame for this on immigrants is wrong, and exacerbates the problem. We are all at fault. By not taking responsibility,
knowledging the nature and composition of the societies in which we already live. It is ironic – and dangerous – that Europe’s anti-immigrant sentiment is peaking just when global structural changes are fundamentally shifting migration flows. The most important transformation is the emergence of new poles of attraction. Entrepreneurs, migrants with PhDs, and those simply with a desire to improve their lives are flocking to places like Brazil, South Africa, Indonesia, Mexico, China, and India. In the coming decade, most of the growth in migration will take place in the global south. The West is no longer the Promised Land, placing at risk Europe’s ability to compete globally. The aging of Europe’s population is historically unprecedented. The number of workers will decline precipitously, and could shrink by almost one-third by mid-century, with immense consequences for Europe’s social model,
Europe’s anti-immigrant sentiment is peaking just when global structural changes are fundamentally shifting migration flows we allowed immigration to become the scapegoat for a host of other, unrelated problems. The enduring insecurity caused by the global economic crisis, Europe’s existential political debates, and the rise of emerging powers is too often expressed in reactions against migrants. Not only is this unjust, but it distracts us from crafting solutions to the real problems. European countries must finally and honestly acknowledge that, like the United States, Canada, and Australia, they are lands of immigrants. The percentage of foreignborn residents in several European countries – including Spain, the United Kingdom, Germany, the Netherlands, and Greece – is similar to that in the U.S.
Integration needed Yet, despite this, we do not make the necessary investments to integrate newcomers into our schools and workplaces. Nor have we done enough to reshape our public institutions to be inclusive and responsive to our diverse societies. The issue is not how many new immigrants are accepted into the European Union, but ac-
the vitality of its cities, its ability to innovate and compete, and for relations among generations as the old become heavily reliant on the young. And, while history suggests that countries that welcome newcomers’ energy and vibrancy compete best internationally, Europe is taking the opposite tack by tightening its borders. But all is not lost. Europe got itself into this situation through a combination of inaction and short-sighted policymaking. This leaves considerable room for improvement. In fact, there are rays of hope in certain corners of Europe. Consider Sweden, which has transformed its immigration policy by allowing employers to identify the immigrant workers whom they need (the policy has built-in safeguards to give preference to Swedish and EU citizens). In more rational times, these reforms would be the envy of Europe, especially given the relative resilience of Sweden’s economy. They certainly have caught the attention of Australia and Canada, which aim to emulate them. There have also been innovations in integrating immigrants. Some initiatives, albeit modest, encourage
those with immigrant backgrounds to apply for publicsector jobs in police forces, fire departments, media, and elsewhere. Such measures also respond to the urgent need for public institutions that look like the populations they serve.
Looking forward There are many other tools to advance integration. We understand well the importance of early childhood education, and what kinds of programmes can bridge the gap between immigrant and native children. We know as well the importance of finding a job in the integration process. We know how to recognise immigrants’ skills better, and how to provide the right kind of vocational training. We know how to ward off discrimination in hiring. But, while we know what to do, we now need to muster the political will to do it. The good news is that, if we get integration right, we will be far more likely to bring publics along on more open immigration policies. Equally important is international cooperation on migration. Last year, during the
Arab revolutions, the EU missed a historic opportunity to begin weaving together the two sides of the Mediterranean. It failed to open its doors to young students, entrepreneurs, and other North Africans. Today, the EU is making a more serious effort to engage its southern neighbourhood. Among the potential opportunities are free-trade agreements, an easing of visa requirements for university students, temporary work programmes, and incentives to attract entrepreneurs. No country is an island when it comes to migration, and none can address it alone. We have a long way to go, probably in a climate that will not turn favourable to immigration for many years. How much progress we can make will hinge on our ability to break through the myths about migration. Migration is changing in fundamental ways, and we must continue to push ourselves to devise systems and approaches that respond to new realities. If we succeed, human mobility can become one of the great assets of the twenty-first century. © Project Syndicate
16 |
business daily July 27, 2012
CLOSING Bo Xilai wife charged with murder
North West must pay more
Gu Kailai, Bo Xilai wife, was charged with poisoning a British businessman in a killing that led to the downfall of one of China’s most powerful politicians. Ms Gu, once a well-known lawyer, was charged with “intentional homicide” in Neil Heywood’s death. An orderly in the family home, Zhang Xiaojun, was also charged. “The facts are clear and the evidence is firm and adequate,” Xinhua said. The prosecution pushes forward the Party’s case against Mr Bo, whose ouster was the most serious upheaval in the country’s top ranks since 1989.
North West Express Ltd has paid a penalty of 70,000 patacas (US$8,750) and overdue rents of more than HK$4 million to the Tuen Mun pier for the last two months, said the Macau Maritime Administration. But North West still has to pay this month’s rent before it can use the Hong Kong pier said the authorities after meeting with the company yesterday. The administration stressed the ferry firm’s services can only be resumed after settling its financial problems and after its vessels pass safety checks.
Draghi vows fight for euro Sends strong signal that ECB will act
E
uropean Central Bank President Mario Draghi pledged yesterday to do whatever was necessary to protect the eurozone from collapse, including acting to lower unreasonably high government borrowing costs. “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro. And believe me, it will be enough,” he told an investment conference in London. “To the extent that the size of the sovereign premia (borrowing costs) hamper the functioning of the monetary policy transmission channels, they come within our mandate.” The comments are Mr Draghi’s boldest to date and suggest the ECB is ready to row back into the debt crisis to defend Italy and Spain whose borrowing costs have spiralled to unsustainable levels. The euro jumped while German bond futures, typically favoured by risk adverse investors, turned negative in response. The ECB has kept its sovereign bond-buying programme moth-
balled for months and internal opposition to reviving it is stiff so focus will turn to what else the ECB could do. Economists think it could be forced to buy bonds again, or alternatively, support struggling euro zone countries via the back door. On Wednesday, ECB policymaker Ewald Nowotny broke ranks with his colleagues, saying that giving Europe’s permanent rescue fund a banking licence so that it could drawn on central bank funds had merits. Mr Draghi and others have previously rejected that option. Alternatively, the bank could act as the Federal Reserve and Bank of England have, and opt for straight quantitative easing – moneyprinting by another name.
Welcome statement “The comments about high government bond yields disrupting ECB monetary policy transmission are interesting, in so far as they hint at a possible attempt to circumvent
Mario Draghi says the central bank will act to save the euro
the restrictions on outright government bond purchases,” said Marc Ostwald, Strategist at Monument Securities. “Of course it remains to be see whether Herr Weidmann, Herr Asmussen, Frau Merkel and Herr Schaeuble would agree with his assessment,” he said, referring to the senior members of the German government and its representatives at the ECB. Mr Draghi said at the weekend that the ECB had “no taboos” over what it could or could not do. His fears
about the failing transmission of monetary policy chime with similar warnings from Bank of France head Christian Noyer in recent weeks. French Finance Minister Pierre Moscovici said Mr Draghi’s remarks on government bond yields were “very positive”. Mr Draghi added that the ECB did not want to do things that should be done by governments. He refused to speculate on the chance of a country leaving the euro but said that the single currency was “irreversible”. Reuters
Asian nuclear expansion on track Growth most seen in China, India, Korea and Russia
S
trong expansion of nuclear power as a carbon-free energy source in Asia is expected to press ahead despite the Fukushima accident in Japan that soured sentiment in some countries, a benchmark report said yesterday. An earthquake and tsunami crippled the Fukushima plant in February 2011, leading to the closure of Japan’s 50 reactors and spurring Germany to pledge to close all of its nuclear reactors by 2022. Nuclear energy had been gaining momentum as an energy source for nations seeking to reduce harmful carbon emissions, but the Japanese accident caused second thoughts in some countries. World nuclear capacity is, however, expected to grow by 44 percent to 99 percent by 2035, according
to a biennial report from the United Nations nuclear body and the Organization for Economic Cooperation and Development. This was little changed from the range of growth of 37 percent to 110 percent in the edition two years ago of the report on uranium resources, production and demand, known as the “Red Book.” “We see it as a speed bump,” said Gary Dyck, head of nuclear fuel cycle and materials at the International Atomic Energy Agency, referring to the long-term impact of the Fukushima accident on the global nuclear industry. “We still expect huge growth in China.” Nuclear capacity is due to expand in East Asia by 125 percent to 185 percent by 2035, the report said. The strongest growth is
Nuclear capacity is due to expand in East Asia by 125 percent to 185 percent by 2035
expected in China, India, South Korea and Russia. This low end of the range does not include any prospect that Japan ends up banning nuclear energy, said one of the authors of the report, Robert Vance, an official with the
OECD Nuclear Energy Agency. Japan has restarted two of its reactors, but this has energised a growing anti-nuclear movement that attracted 100,000 people at a protest this month. Reuters