21-01-2019

ECONOMY & BUSINESS
BANGLADESHTODAY 10
THE
SUnDAy, JAnUARy 20, 2019
On 20th January 2019 State Minister of Water Resource Jahid Faruk and Deputy minister AKM
Enamul Haque Shamim visited Goranchatrari Pump House aiming to make Dhaka city free
from Flood and Water logging.
Photo: Courtesy
European stock markets
surge on China-US trade
breakthrough hopes
Stock markets across the
globe powered higher
Friday, buoyed by hopes of a
breakthrough in efforts to
defuse a US-China trade
war.
European and Asian
indices bounced back
strongly after the Wall Street
Journal (WSJ) reported that
the US was considering
lifting tariffs on China as
officials look to hammer out
a trade deal.
In the late New York
morning, the Dow Jones
was also up, having already
gained on Thursday on the
report which helped the
market recover from a
wobble triggered by news
that the US was carrying out
a criminal probe into
Chinese tech giant Huawei.
"Global markets are
enjoying an overwhelmingly
bullish end to the week, with
hopes of a potential
breakthrough in US-China
trade talks helping drive
optimism," said Joshua
Mahony, senior market
analyst at traders IG.
The dollar also firmed.
The WSJ reported that US
Treasury Secretary Steven
Mnuchin had raised the idea
with US Trade
When bear turns
to bull on China
property market
Over the course of the last,
booming decade, it would
have been hard not to be
bullish about Chinese
property shares. However,
with changing conditions in
the market, the bears are
firmly in control, and most
agree that the next 12 months
are going to be tough for
China property stockholders.
As one of the very few voices
of caution in the last decade of
the China property market,
BNP Paribas managing
director and regional head of
research Lee Wee-liat
arguably missed the biggest
boom on the planet. Now,
once again counter to current
wisdom, he is optimistic about
the next 12 months.
In a report this week, Lee
made a big call to buy into
Chinese property stocks
because he sees a potential
upside of at least 60%,
including dividends. This is
because he believes that
property prices will remain
steady, or only fall as little as
5% as the supply of housing
decreases faster than demand.
More importantly, leading
private developers such as
China Evergrande, Sunac,
R&F and Agile Group, have
continued to improve
themselves financially by
deleveraging and speeding up
the sales of units for which
they did not pay top dollar.
Since 2007, Lee has been
notoriously bearish on the
property market, first with
Nomura and later with
Samsung Securities.
Representative Robert
Lighthizer of removing some
or all levies on Beijing in
return for structural
reforms.
It said the move was part
of a bid to reassure markets
and bolster the odds of a
bigger trade deal, ending a
months-long saga that is
beginning to impact
economies around the
world, particularly China.
However, the Treasury
Department told AFP that
no formal recommendation
had been made by either
Mnuchin or Lighthizer in the
talks, which were "nowhere
near completion".
"The US government has
said that there have been no
formal talks to scale back
tariffs, but the market saw
the half glass full as the
reports signal that
concessions are in the
works," said Alfonso
Esparza, senior market
analyst at OANDA.
However, there was
scepticism among some
analysts, with the two sides
still far apart on a number of
issues, particularly
regarding intellectual
property.
On currency markets the
pound edged lower, giving
up earlier gains seen as
dealers bet that Britain
would not leave the
European Union without a
deal.
After her grand Brexit plan
was soundly rebuffed by
MPs this week, British
Prime Minister Theresa May
has called cross-party talks
to put together a "Plan B" by
Monday.
If that does not work, there
is a growing expectation that
the March 29 exit deadline
will be pushed back to give
May more time to reach
another deal or possibly call
another referendum.
Oil prices meanwhile rose
on the China-US tariffs
report and after OPEC said it
had cut output in December
before a new agreement to
limit supply took effect.
Both main contracts are
up around a fifth since the
end of December, thanks to
an agreement to cut output
by OPEC and other key
producers including
Russia.
That followed almost three
months of losses that wiped
around 40 percent off prices
amid concerns supply was
running ahead of demand.
Lebanon foreign
minister urges
Arab League to
readmit Syria
Lebanon's foreign minister
on Friday called for the Arab
League to readmit Syria ahead
of a regional economic
summit in Beirut, more than
seven years after it suspended
Damascus' membership.
"Syria is the most notable
absentee at our conference,
and we feel the weight of its
absence," Gibran Bassil said.
"Syria should be among
us… without us having to wait
for a permission for it to
return," he added at a meeting
with other ministers from
Arab League nations.
The Arab League
suspended Syria in November
2011, as the death toll rose in
the regime's brutal repression
of anti-government protests.
But in recent years,
President Bashar al-Assad's
forces have gained the
military upper hand against
rebels and jihadists, and
efforts to bring his
government back into the
Arab fold appear underway.
In December, Sudan's
President Omar al-Bashir
made the first visit by any
Arab leader to the Syrian
capital since 2011, and the
United Arab Emirates
reopened its embassy in
Damascus after closing it in
2012.
On Thursday, the head of
the Arab League, Ahmed Abul
Gheit, said member states
have not reached a consensus
on Syria's return to the 22-
member bloc.
Philippines' richest
man Henry Sy
dead at 94
Henry Sy managed to
build a multi-billion dollar
business empire after
opening his first shoe store
in downtown Manila in
1956.
Henry Sy had a net worth
of $19 billion as of Friday,
according to Forbes.com
Sy helped create mall
culture in the Philippines
The Philippines'
wealthiest man Henry Sy,
who rose from being a
penniless Chinese
immigrant to leading a
multi-billion dollar business
empire, died on Saturday,
his conglomerate has
announced.
The 94-year-old, from the
Chinese city of Xiamen,
made his fortune with a
Philippine shopping center
conglomerate that has put
up some of the largest malls
in the world.
However his holdings also
included banks, hotels and
real estate in the
Philippines, as well as
shopping centers in China.
He had a net worth of $19
billion as of Friday,
according to Forbes.com.
Forbes said he was the
52nd richest person in the
world last year, beating out
bold name tycoons like Elon
Musk, Rupert Murdoch and
George Soros.
"Henry Sy ... passed away
peacefully in his sleep early
Saturday morning. There
are no further details at the
moment," his SM group
said in a statement.
Sy put up his first shoe
store in downtown Manila
in 1956, a business which
later grew into a diversified
empire.
He stepped down as
chairman of his holding
firm in 2017, assuming the
title of "chairman emeritus"
and leaving trusted allies as
well as his children in
charge of his empire.
It was a long journey for a
man who came to the
Philippines as a boy to work
in his immigrant father's
variety store.
"Our store was so small it
had no back or second floor,
we just slept on the counter
late at night after the store
was closed," he told the
Philippine Star newspaper
in 2006.
After their shop was
destroyed during World
War II, Sy's father returned
to China but Henry chose to
stay in the Philippines.
He got a commerce
degree from a Manila
university and started
selling shoes in a shop
which would later grow into
a chain named "ShoeMart."
By 1972, his shops had
branched out into selling all
manner of goods,
prompting the name to be
changed to SM Department
Store.
But it was in 1985 that Sy
made history when he
opened his first "Supermall"
in Manila.
Spanning over 424,000
square meters (4.6 million
square feet), the mall
included dozens of stores,
numerous cinemas,
restaurants, banks and
other attractions that made
it a one-stop shop for
millions of Filipinos.
This was just the start, as
more of Sy's mammoth
malls popped up across the
country, some even
containing ice skating rinks,
a rarity in the tropical
country.
Sy helped create mall
culture in the Philippines,
where steamy temperatures
and the regular threat of
torrential downpours can
make outdoor shopping
uncomfortable.
Sy's holding company, SM
Investments Corp. opened
its first mall in China in
2001 and has been
expanding there as well.
US stocks rise
for 4th straight
day on trade
deal hopes
Wall Street stocks rose for
the fourth straight session
Friday, closing out a strong
week on optimism over US-
China trade talks, despite
sharp drops in Netflix and
Tesla Motors.
The Dow Jones Industrial
Average climbed 1.4 percent
to 24,706.35. The blue-chip
index has risen more than 13
percent since December 24.
The broad-based S&P 500
gained 1.3 percent to 2,670.71,
while the tech-rich Nasdaq
Composite Index advanced
1.0 percent to 7,157.23.
The closes marked the
fourth straight weekly gains
for the Dow and S&P and the
third for the Nasdaq.
Analysts said the gains
reflected a continuation of the
optimism following a report
on Thursday that the United
States was considering lifting
tariffs on China as a step to
win a broader trade
agreement. After a bruising
December, US stocks have
been in rally mode in early
2019 amid optimism on trade
and relief at Federal Reserve
commentary suggesting a
cautious approach to further
interest rate hikes.
There's "definitely rising
optimism" of a trade deal, said
LBBW's Karl Haeling.
"There are kind of smoke
signals and when there is
smoke there is fire," Haeling
said. "It seems that Trump
sees the weakening of the
economy and the shutdown
situation.
A daylong Training Workshop on 'Internal Control & Compliance Risk Management in
Branches' arranged by Al-Arafah Islami Bank Training & Research Institute was held at Hotel
Peninsula Chattogram on Saturday. Vice Chairman of the Bank Md. Abdus Salam inaugurated
the workshop as Chief Guest. Deputy Managing Director Mohammed Zubair Wafa presided
over the ceremony. Among others Principal of the Institute and Executive Vice President Md.
Abdur Rahim Duary, Senior Vice President Aktar Kamal and Senir Vice President & Zonal Head
of AIBL Chattogram Zone Mohammad Azam were present in the occasion. Selected officials of
AIBL Chattogram Zone participated in the workshop.
Photo: Courtesy
Warm weather
slows US
industrial output
in December
Unseasonably warm
weather in December held
down Americans' use of gas
and electricity, weighing on
US industrial production for
the month, the Federal
Reserve reported Friday.
But otherwise the industrial
sector hummed along at the
close of 2018, with
manufacturing hitting a 10-
month high while oil and gas
drilling also rose.
Economists have warned
that US manufacturing may
have peaked but December's
numbers, which are subject to
revision, suggested a
slowdown may not have
begun yet.
The Fed's industrial
production index rose 0.3
percent, a tenth of a point
slower than November but
faster than the 0.2 percent
economists had been
expecting.
Manufacturing output
jumped 1.1 percent, the
biggest gain since February,
driven higher by the key auto
sector, which accelerated by
4.7 percent. Mining activity -
mainly oil and gas drilling -
was up 1.5 percent, which
helped offset the sharp 6.3
percent decline utilities.
Production in 2018 rose
four percent compared to the
prior year, while
manufacturing posted a 3.2
percent increase.
Global stocks surge
on China-US trade
breakthrough hopes
Stock markets across the
globe powered higher
Friday, buoyed by hopes of
a breakthrough in efforts to
defuse a US-China trade
war.
European and Asian
indices bounced back
strongly on Thursday after
The Wall Street Journal
reported Washington was
considering lifting tariffs on
China as officials look to
hammer out a trade deal.
Wall Street joined the
party later Friday, with
major indices rising one
percent or more to close out
the fourth day in a row of
gains. The Dow has risen
more than 13 percent since
December 24.
Bloomberg also reported
Friday that Beijing had
offered to eliminate its
soaring trade surplus with
the United States in five
years.
"Global markets are
enjoying
an
overwhelmingly bullish
end to the week, with hopes
of a potential breakthrough
in US-China trade talks
helping drive optimism,"
said Joshua Mahony,
senior market analyst at
traders IG.
There's "definitely rising
Beijing hopes to boost
domestic consumption
amid trade war
Hebei province believes
that launching a two-anda-half-day
weekend will
help boost local
consumption
Beijing has pinned hopes
on creative measures from
provincial governments to
boost regional economies
amidst the ongoing trade
war with the United States.
To stimulate domestic
consumption, Beijing
encouraged longer
operating hours in urban
areas including shopping
malls, supermarkets and
convenience stores while
in neighboring Hebei
province, the authorities
are studying the
possibility of introducing a
four-and-a-half-day
working week.
In a directive published
online, Hebei province has
proposed a two-and-ahalf-day
weekend that is
devised to increase
consumption during 2019
and 2020 by encouraging
employers to adopt more
flexible working hours and
encourage leave on nonpublic
holidays.
optimism" of a trade deal,
said LBBW's Karl Haeling.
"There are kind of smoke
signals and when there is
smoke there is fire,"
Haeling said. "It seems that
Trump sees the weakening
of the economy and the
shutdown situation. He
seems to be doing
something to get a win
here."
However, there was also
skepticism among some
analysts, with the two sides
still far apart on a number
of issues, particularly
regarding intellectual
property.
On currency markets the
pound edged lower, giving
up earlier gains seen as
dealers bet that Britain
would not leave the
European Union without a
deal.
After her grand Brexit
plan was soundly rebuffed
by MPs this week, British
Prime Minister Theresa
May has called cross-party
talks to put together a "Plan
B" by Monday.
If that does not work,
there is a growing
expectation that the March
29 exit deadline will be
pushed back to give May
more time to reach another
Some ideas arising in
different municipalities
are nothing if not creative.
For example, the
provincial Guangdong
government is to launch a
10 billion yuan (US$1.48
billion) project that will
train 50,000 chefs in the
preparation of Cantonese
cuisine by 2022.
This comes as part of a
project kicked off by the
Guangdong government
in 2018. The new scheme
involved setting new
standards in Cantonese
cuisine, including ratings
and recognition for
restaurants and
employers that will
facilitate the employment
and
increase
e n t r e p r e n e u r i a l
opportunities for 300,000
workers employed in the
food industry.
State planners last week
announced their intention
to roll out a new set of
incentives to encourage a
billion Chinese consumers
to buy more items such as
cars and home appliances.
This is seen as an effort to
deal or possibly call another
referendum.
Oil prices meanwhile rose
on the China-US tariffs
report and after OPEC
said it had cut output in
December before a new
agreement to limit supply
took effect.
Both main contracts are
up around a fifth since the
end of December, thanks to
an agreement to cut output
by OPEC and other key
producers including
Russia.
That followed almost
three months of losses that
wiped around 40 percent
off prices amid concerns
supply was running ahead
of demand.
Shares of US companies
with significant China
operations gained,
including Dow member
Boeing, Caterpillar and
Nike.
But Tesla Motors dived 13
percent after the electric car
maker announced plans to
cut seven percent of its
workforce and forecast lean
profits.
Netflix fell 4.0 percent as
its profits topped analyst
expectations but analysts
worried that subscriber
growth was slowing.
fend off an economic
downturn in times of
falling stock markets and a
Sino-American trade war.
The state-owned
People's Daily supported
Hebei's proposal, stating
that "one cannot work well
if he does not know how to
rest well. Whether
encouraging off-peak
holidays or flexible
working hours, or the 2½day
weekend, they should
follow public opinion and
ultimately provide for
better work."
H o w e v e r ,
commentators on the
Internet are worried that
the longer weekend
benefits only civil servants
because many companies
do not even guarantee two
weekly holidays. They
hope public services will
not be affected by this new
policy.
Whatever the argument,
it is clear that Beijing is
determined to stimulate
consumption, one way or
another, as a first line of
defense against a slowing
economy.