As of Monday, I become the Opening Bell Editor at DealBreaker, a Wall Street financial blog. The Opening Bell
column is the first on the site every morning, summarizing the
overnight news from Asia and Europe, and looking forward towards
relevant market news in the day ahead.
On Saturday, I published an Opening Bell (Weekend Edition) here at The Global Perspective. Opening Bell Asia is the second "dress rehearsal" for the official column at DealBreaker tomorrow morning. That will appear at around 7 am EST, so make sure you check by the site for it! As for yesterday's, the following column is somewhat abridged (5 links): tomorrow at DealBreaker there will be a fuller, more rounded view of the global markets.
OPENING BELL ASIA: 10.05.08
Taiwan Regulator Says AIG's Units Have Sound Fundamentals (Dow Jones Newswires via CNN Money)
The AIG saga continues, this time in Taipei. AIG has three money management divisions in Taiwan: AIG Investment, AIG Securities Investment & Trust, and AIG Wealth Management Services Taiwan. For the moment, officials say they are fairly satisfied with what they see in that trinity. All too often, little news items such as this one go overlooked by investors, who are suddenly amazed by a headline five months later that reads something like: "AIG Taiwan's operations show $7.5 billion in fourth-quarter gains in Chinese mainland life insurance sales." It may be worth paying attention here: since the elections early this year, Taiwan has played an increasingly significant role in the life of the Chinese consumer and investor. Added to that, Taiwanese financials are in reasonable shape. Of course, this may just be typical guanxi backscratching -- but it's also the classic sort of spot news that eventually has short-sellers in a goliath like AIG squeezed hard on the way out.
Ping An abandons Fortis deal (Finance Asia)
Why does it feel like the insurance names are going to be dominating the space in all the end-of-day market wraps today? Apparently Ping An, China's second largest insurer, has "scuppered" an agreement to buy 50% of Fortis for $3.3 billion. According to Ping An, the agreement to terminate the contract -- agreed in March -- was "mutual ... given current turbulent market circumstances." That's a bit hard to believe: much more likely, Ping An threw its weight around with the help of some key Chinese policymakers, who essentially said to Fortis and its European politico equivalents: "Trash this deal or face the consequences of a hostile shareholder." (Ping An means "Peace" in Chinese). Even JP Morgan, who arranged the deal, reckons it pays off to Ping An's favor. Curiously however, JP Morgan also expects Ping An to go fishing around for foreign assets to bolster its international presence soon ... AIG's latest fire-sale, perhaps?
China says new tests show milk free from melamine (AP)
China's food safety regulators must be thanking their lucky stars that the global banking fallout came when it did, since this story has gone largely unnoticed as a result. After 54,000 infants were infected with toxic doses of melamine, China's officials are saying that the latest tests of 129 batches of baby milk powder and 212 batches of other sorts of milk substitutes, are safe. Well ... believe it when you see it: especially since Hong Kong's considerably more reliable food safety squad reported on Sunday that two kinds of Cadbury's bars were infected with higher-than-allowed doses of the chemical. If this continues after the headlines of the financial crisis dies down, expect some heavy scattergun selling activity across shares of Asian food producers.
Top Lots Shunned in Post-Lehman Art Sale at Sotheby's Hong Kong (Bloomberg)
This story is hardly surprising: after all, if people aren't buying banks right now, they're unlikely to be paying millions of dollars for Indonesian sketches of superheroes. However, it says something interesting about the amount of money actually swirling around in Asia right now -- namely, that it's probably not as abundant as we all first thought. With sales of $11.6 million, and the highest lot going for just HK$6.6. million ($849,000), 20 percent of lots remained unsold. The article quotes a buyer saying that people can't "justify" paying high sums for art right now ... the other possibility is that people just don't have that kind of cash on hand right now.
Dubai aims to top its own world's tallest tower (International Herald Tribune)
Just when everyone is scaling back, Dubai is building a new tower soaring two-thirds of a mile. Depending on your preferred frame of reference, that's three Chrysler Buildings, or more than ten football fields. Apparently, in Dubai "demand outstrips supply" according to Chris O'Donnell, the project's chief executive. The project is expected to take 10 years to complete, but still, it's hard to imagine that in a world of falling oil prices, a global credit crunch, and a hemorrhaging international real estate market that there would be the kind of funds on hand to prop up such a project. Either way, the announcement of the new tower will be a plus for scrap commodities!
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