SINGAPORE : Asian equities rose on Wednesday and the dollar wobbled as weak U.S. labour data bolstered bets that the Federal Reserve was likely done with its interest rate hikes, while beaten-down China stocks rose for a third straight day.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.86 per cent to a two-week top and is on a three-day winning streak. The index though is down 6 per cent in August and set for its worst monthly performance since February.

Japan’s Nikkei was up 0.5 per cent, while the Australia’s S&P/ASX 200 index rose 0.64 per cent.

China shares have gained this week following the announcement of measures to lift investor confidence, including halving the stock trading stamp duty, loosening margin loan rules, and putting the brakes on new listings.
In early trading, the blue-chip CSI 300 Index was 0.3 per cent higher, while Hong Kong’s Hang Seng Index rose 0.75 per cent.

Analysts though see a need for more action from Chinese authorities to sustain the rally.
“It will take more resolute policy measures and a sustainable recovery in earnings in order for the rally to last,” Carlos Casanova, senior economist for Asia at UBP, said. Investors’ focus will be on PMI data from China later this week that will highlight the state of the economy.

Overnight, Wall Street ended sharply higher, while Treasury yields slid to three-week lows after data showed U.S. job openings dropped to the lowest level in nearly 2-1/2 years in July, signalling easing labour market pressures.

“‘Bad news is good news,’ as
the data supported bets for a sooner end of the Fed’s hiking cycle despite the recent hawkish rhetoric of Fed Chair Powell,” Tina Teng, markets analyst at CMC Markets, said in a note.

With the Fed highlighting that the interest rate path will be heavily dependent on data, traders are tweaking their bets based on the latest indicators. Source: Reuters

As Cambodia and India move closer to finalizing a bilateral free trade agreement, residents of both nations can anticipate the introduction of direct flight routes by early next year.

This development aligns with the remarkable growth in diplomatic relations between the two countries in recent times, as highlighted by the Cambodian Ambassador to India, Kuong Koy. He also expressed optimism that direct flights would commence in early 2024.

When this plan becomes a reality, Cambodia stands to benefit significantly, with increased tourism, expanded trade opportunities, and heightened investment prospects, akin to the positive outcomes seen with direct flights between India and other ASEAN member nations.

Given India’s status as a nation with over 1 billion people, countries worldwide, especially ASEAN member states, have actively been seeking a share of India’s lucrative tourism market.

According to Thailand’s Ministry of Tourism and Sports, nearly 990,000 Indians visited Thailand in 2022, second only to Malaysia.

Initial data for the first five months of 2023 places India among the top sources of visitors to Thailand, with more than 600,000 Indian tourists arriving in Thailand up to May. The TAT anticipates welcoming 2 million Indian visitors this year.Source: Laotian Times

HONG KONG: Just how cash-strapped embattled Country Garden Holdings is will be the focus when China’s largest private property developer is due to report its first-half results on Wednesday.

The liquidity stress in the company became public this month after it missed two dollar coupon payments and sought to extend an onshore private bond repayment, deepening contagion fears in China’s struggling property sector, and the wider economy.

Country Garden’s total liabilities stood at about $194 billion at the end of 2022. It has already flagged a net loss of up to 55 billion yuan ($7.55 billion) in the first six months, a staggering slide from the 6.7 billion yuan loss it posted in the second half of 2022 and from the net profit of 1.9 billion yuan it posted a year earlier.

Like its peers, the company, which was China’s largest property developer by sales volumes until this year, has been hurt by a drop in margins as property sales and the value of the homes themselves plummeted in China’s slowing economy. Lower sales, coupled with tighter access to fresh funding in recent years, worsened its cash squeeze.

An analyst with a foreign investment bank said investors were looking for details on short-term debt and new bank loans to better understand Country Garden’s cashflow.

Because most of its funds are locked up in the escrow accounts of project contractors to ensure the delivery of homes over the next two years, there is little cash left for repaying debt at the group level, a company official said.

About 60 per cent of the company’s total onshore bonds mature over the remaining months of the year, and if the company is able to extend its repayment deadlines, it could be able to improve its operations and cashflow, the official added. They declined to be named because they were not authorised to speak to media.

JP Morgan has estimated it would cost about 316 billion yuan to finish all the company’s projects under construction, including both

sold and unsold flats.

Country Garden declined to comment ahead of its earnings. The company will also not hold meetings with analysts and the media after the earnings announcement, the first time it skips these conferences in many years.

Source: Reuters