The United States and Canada today (Friday) joined other Group of Seven (G-7) nations to intervene as a means of weakening the Japanese yen in an effort to help Japan deal with last week's catastrophic earthquake and tsunami. This G-7 intervention is a substantial development, although there are precious few details, since none of the […]
With a magnitude of 9.0, the March 11 earthquake in Japan was the worst in that country's 300-year history and was the fifth-worst the world has ever seen.
That trembler, coupled with the devastating tsunami that followed, ignited a flurry of fears and caused a two-day sell-off that sent Japanese stocks down 17%. The sell-off wiped out more than $650 billion in shareholder wealth.
Money Morning Chief Investment Strategist Keith Fitz-Gerald has spent almost every summer for the past two decades at his family home in Kyoto – which is why he knows Japan in a way that few other U.S. traders could ever hope to.
As part of Money Morning's continued coverage of the disaster in Japan, Fitz-Gerald is sharing those insights with readers. Here are the highlights of a question-and-answer session we held with Fitz-Gerald late yesterday ( Thursday).
Japan's earthquake-ignited nuclear crisis got even worse early today (Wednesday), igniting major losses in stock markets around the world as analysts came to terms with both the spiraling costs of the disaster and the spinoff effects that continue to surface. The official death toll approached 4,200, with thousands more still missing, NHK World/Radio Japan International […]
Despite market volatility and a shaky economic recovery, the global initial public offering (IPO) market for 2010 is on track to hit a record high – and 2011 is poised to continue the hot streak.
A study by accounting group Ernst & Young yesterday (Wednesday) showed that funds raised through global IPOs are expected to surpass $300 billion in 2010, topping the 2007 record of $295 billion. IPOs in the first 11 months of the year collected $255.3 billion in 1,199 deals.
"New IPO filings continue to increase around the world and a large backlog has built up as companies await greater macroeconomic stability," said Gregory Ericksen, Ernst & Young's global vice chair for strategic growth markets. "We expect the current IPO momentum to continue its upward trend in 2011."
Asia was a great place to invest this year.
While some individual Latin American markets have outpaced their Asian counterparts, the fact is that the 10.9% return of the overall MSCI Asia Index outdistanced the 10.3% return of the "Americas" region.
Investors can expect more of the same in the New Year. The fact is that the Asian region – including Australia and New Zealand – was a profit powerhouse in 2010. And Asia's prospects for 2011 are even brighter:
- It's where a great majority of the world's growth is taking place.
- And it's where investors can reap their biggest profits – if they pick the right investments in the best Asian markets.
Thailand last week joined the crush of Asian countries rushing to acquire a stake in Canada's giant oil sands projects when its PTT Exploration & Production Public Co. Ltd. (OTC ADR: PEXNY) agreed to buy 40% of Statoil ASA's (NYSE ADR: STO) Canadian oil sands project for $2.3 billion.
PTTEP, the exploration and production unit of state-owned PTT PCL, is making Thailand's first foray into Canada's oil sands, the largest source of crude oil outside the Middle East.
Norway's Statoil will keep majority ownership and remain the primary operator in the Kai Kos Dehseh project in northern Alberta, which it bought in 2007, according to the deal announced on Tuesday.
The United States – and Wall Street – is surrendering its mantle as the global center for intial public stock offerings (IPOs).
In fact, unprecedented demand for IPOs in Asia has reduced the U.S. share of the global IPO market to an all-time low.
With another $10 billion in IPO deals expected to be completed by the end of this year, the total amount raised worldwide for all of 2010 will approach $145 billion.
With $76 billion raised – including $22.1 billion from Agricultural Bank of China Ltd., alone – China topped the field by raising the most money of any single country.
No U.S. company raised more than $700 million.
This says a lot about the respective outlooks for the two countries' economies. And it also tells us a great deal about how we should be investing our money.
Let me explain.
China for months has blocked shipments of rare earth metals intended for Japan in retaliation for a regional dispute. Now, China appears to have expanded its rare earth embargo to include Western countries – a move that has U.S. and European authorities scrambling to formulate a backup plan.
Rare earth metals are essential to the production of high-tech devices like computers, display screens, smart bombs, and hybrid-car batteries. And despite their name, rare earth metals aren't particularly rare. However, they are difficult to produce and many rare earth production companies have moved their operations to China to capitalize on cheaper extraction costs and the nation's commitment to growing its alternative energy sector.
China, which has one-third of the world's rare earth deposits, accounted for 97% of global production last year. Of course, the near-total monopoly China wields over the sector wasn't a major concern until just a few months ago when the country cut its production and export quotas.
Singapore Exchange Ltd. (SGX) announced yesterday (Monday) it agreed to buy Australia's main stock exchange, ASX Ltd., for $8.3 billion. The deal came about because both countries seek strength against growing Asian market competition, and Singapore strives to be a more sophisticated global financial center.
In a cash and stock deal, Singapore's stock market operator is offering A$48 (U.S. $47.11) for each ASX share, consisting of A$22 in cash and 3.743 SGX shares per ASX share. The offer is at a 37% premium to what ASX shares traded on Friday.
"The combination of ASX and SGX, offering innovative new products and services to the market, will allow customers to maximize future opportunities, where Asia Pacific takes center stage globally as the source for capital, wealth creation and trading opportunities," SGX Chief Executive Officer Magnus Bocker said in a joint statement.