Markets Archives - Page 462 of 782

Next-Generation Vietnamese are Taking Over the VCP

The Vietnamese Communist Party (VCP) is preparing a new slate of leaders to replace the old guard who are retiring at the 12th National Congress in 2016. Public attention has been drawn to the rise of young ‘princelings’ — the children of current or former leaders in communist authoritarian regimes like Vietnam and China — to local executive positions and bodies.

The ability of these princelings to deliver on a broad range of governance issues, beyond just high levels of economic growth, will determine the durability of the current regime.

India Election Upheaval Leads Emerging Markets News

1) The ruling party in India, the BJP, was defeated in the Bihar state assembly elections; 2) Brazilian markets have gotten excited about the prospects of a change of the country’s Finance Minister; 3) The MSCI went through with its decision to include several Chinese ADRs into its index; 4) China doubled the margin requirement for stock purchases after markets closed Friday; 5) Mexico’s central bank sounded somewhat less hawkish in its minutes

Leveling Australia’s Superannuation Playing Field

The taxation of superannuation has been the cause of much consternation. Much of the difficulty is the result of the slow drift of superannuation from the moorings of its original purpose.

In introducing the superannuation guarantee in 1992, the Keating government was pursuing an ideal firmly centred on the ordinary person of ordinary means. The hope was to extend superannuation to the entire workforce as a means of ensuring working people were not wholly dependent on the state in funding their retirement.

China Sees Lower Growth, Higher Stock Prices

Despite indicators of a continually cooling macroeconomic environment, Chinese stocks continue higher, even as disinflation and weak factory activity signal continued weakness.

Saving Malaysia from Itself

Malaysia is currently in crisis; the ringgit seems to be on an inexorable downhill slide, ethnic tensions have deteriorated from an uncomfortable simmer to an open flame, and both the government and opposition coalitions are unravelling. Malaysian politics and society have hit rough patches before. The dominant United Malays National Organisation (UMNO) party fractures about once a decade, opposition parties fall in and out of love like teenagers, and cyclical economic downturns summon forth the usual host of scapegoats and bogeys.

Low Commodity Prices Threaten the Congo

Many African countries have in recent years, shown phenomenal economic growth. However, recent developments on global markets – including the drop in prices of commodities such as oil, copper, and cobalt – have raised questions about the sustainability of Africa’s economic growth.

The instability of global market has lowered investors’ confidence, and led to questions about the health of the global market. There is a feeling of uncertainty and fears of financial global crises, especially due to a slowdown in China’s economy.

ISM Data Shows Services Leaving Manufacturing in the Dust

The October employment data convinced many that a Fed hike in December is a strong probability. On top of the strongest average hourly earnings in several years, the US reported a record increase in September consumer credit. Earlier last week, the US reported the stronger than expected October auto sales. It was the second month in excess of 18 mln vehicles at an annualized rate. This happened two other times since 1990.

A Dark Cloud Still Hangs Over Emerging Markets

EM starts the week off on softer footing, as Friday’s jobs report supports the notion of December Fed lift-off. USD/ZAR is making new all-time highs, and we expect most of EM to revisit the lows from August and September as the lift-off approaches. Barring a disastrous November jobs report, we believe a rate hike will happen on December 16. As such, we remain negative on EM near-term.

India’s BJP not Feeling the Love in Bihar Election

As the Hindi saying goes: If you live in the water, do not make an enemy of the crocodile.

The ruling party in India, the BJP, was defeated in the Bihar state assembly elections. The party came out with 59 seats out of 243, down 35 seats from the previous elections and considerably worse than expected. Many were looking at the Bihar elections as a referendum of sorts on Modi’s first 17 months in power.

Finance Dominates U.S. GDP Growth

Finance and insurance is seeing the largest increases in its contribution to America’s GDP, largely due to more Federal Reserve banks and use of credit in America and in foreign markets.

Finance and insurance saw a 12.4% increase in its value as a contribution to GDP in the second quarter of 2015 after falling 3.8% in the first quarter. The Bureau of Economic Analysis attributed the growth to “an increase in Federal Reserve banks, credit intermediation, and related activities.”