Market Gazer Hong Kong - Japan - Germany - UK - North America
market review : global growth will be at moderate pace in Hong
Global stocks
ended mostly
down, with Nikkei
225 ended lower
at 9,566.32 or
down 0.37%, Hang Seng Index gained
45.12 points to end at 22,047.71, the
European shares plummeted a FTSE and
DAX fell 0.44% and 1.08%, respectively,
and the Dow fell 21.72 points to
10,739.31. The tech stocks retreated to
2,334.55, while the S&P 500 ended at
1,134.28. Fingers were pointing at the
interpretation of the FOMC’s decision
earlier that the Fed’s monetary stimulus
will mean that the Fed will print more
money and flush them to the system.
Fed’s statement that it is ready to take
steps to support growth was also
interpreted as the sign that the economic
outlook at the moment remains gloomy.
Countering the complaints from its
European and American counterparts,
China said that its trade surplus were not
caused by yuan value but rather, the
surplus were driven by the investment
and savings structure in China. Chinese
PM Wen Jiabao said that China did not
pursue a trade surplus intentionally. Wen
will meet with Obama at the United
Nations General Assembly in New York on
Thursday.
Following the Fed’s stance to keep
interest rates steady at 0.5%, Hong Kong
Monetary Authority also kept its base
rate at 0.5%. The HKMA also said that
22 September 2010
Kong throughout the end of the year,
boosting the local stock market. The boost
faded near the closing as Hong Kong
investors readied for a holiday on
Thursday.
On the economic data front, Eurozone
industrial new orders slowed to 11.2%
year-on-year from 22.7% in July. Month-
on-month, July’s new orders slipped 2.4%
after gaining 2.4% in previous month.
Meanwhile, the consumer confidence
stayed at -11 in September, below the
expected -10.
Bank of England’s MPC
minutes showed the 8
members of the Committee
were in favor of holding the
rates steady while Andrew Sentence
again, favored for increasing the rates.
US data was thin with only house price
index for July featured. The month-on-
month index fell 0.5% in July, worse than
the expected 0.2% decline and the 0.3%
fall in June.
Nissan Motor and Renault
SA announced their plan to
jointly develop platforms
for a minimum of 10 models. The
collaboration will reduce parts
procurement costs for midsize autos by
30%, saving a few hundred billion yen
annually. About 70 key components
would be standardized as a part of the
plan. Nissan ended at ¥702 on
Wednesday, down 1.54%.
E-mail: market.techspeak@gmail.com
Page 1
 Market Gazer
Toyota Motor offered $1.29 billion in
bonds backed by auto loans. The biggest
part worth $347.1 million to mature in 1.9
years, with a yield of 18 basis points.
Toyota fell to ¥3,040, or 0.98%.
Cheung Kong
Holdings will sell its
apartments in Hong
Kong’s Ma On Shan district with the price
ranging from HK$4.87 million and HK$9.1
million per unit. The sales will commence
at the beginning of October and will
involve 108 units from a total of 1,143
units being developed. The price per
square foot has been set at HK$6,438,
below the consensus price. The shares
finished at HK$112 after gaining 2.56%.
China Overseas Land was downgraded to
NEUTRAL from OVERWEIGHT by HSBC,
sending the shares to HK$17.36 by the of
the day, or down 0.46%.
Hong Kong Exchanges &
Clearing (HKEX) was
boosted by the news that
AIG has gained approval for
an IPO of its AIA worth US$ 10 billion to
US$15 billion. This will be the second
biggest IPO in the world. HKEX settled at
HK$142.50, up 1.4%.
Daimler AG was reportedly offered a bid
for Fiat Industrial SpA, the Fiat’s truck and
tractor unit. La Repubblica, which
reported the news did not specify the
sources of the information. Daimler
however, denied the news. On another
22 September 2010
Hong Kong - Japan - Germany - UK - North America
news, the company said that it would
start selling loans worth 7 billion euros to
refinance its debt. Daimler sliped 1.72% to
€44.85.
Volkswagen planned a new
engine plant in Mexico
which would have a
capacity of 330,000 units.
The investment will cost the company
$550 million, according to VW’s Otto
Lindner. At the closing time, VW hovered
at €80.37, 1.63% lower than Tuesday’s
close.
Rolls-Royce Plc. announced that it will
supply Trent 700 engines to Deutsche
Lufthansa AG and Swiss Airbus. The deal
won worth $560 million. The shares
however, shed 2.04% to 576.50 pence.
Prudential’s unit Prudential
Financial Inc. planned to buy
two Japanese insurers from
AIG: AIG Star Life Insurance Co. and AIG
Edison Life Insurance Co. Both companies
will worth $4 billion to $5 billion, and the
plan is part of AIG’s program to repay its
bailout which cost the government $182.3
billion. Prudential was at 614.50 pence at
the end of Wednesday’s session.
Disappointment over Adobe’s forecast
over revenue savaged the stock as it
plunged 19% to end at $26.67. Various
houses downgraded Adobe on
Wednesday, with Credit Suisse now puts
Adobe at NEUTRAL, down from
OUTPERFORM with target at $32.50,
lower than prior $39. Deceleration in
E-mail: market.techspeak@gmail.com
Page 2
 Market Gazer Hong Kong - Japan - Germany - UK - North America
revenue and lack of catalysts in the near-
term were the factors behind the
downgrade. FBR Capital also revised its
rating on Adobe, putting it at MARKET
PERFORM from OUTPERFORM.
ThinkEquity reduced Adobe’s price
targetto $30 from $43 while lowered its
rating to HOLD from BUY. Bank of
America/Merrill and UBS both also
downgraded Adobe to NEUTRAL from
BUY. UBS cited reduced growth, lack of
catalysts and potential for more
compression. Price target was lowered to
$30 from $45. Going further, UBS also
recommended Oracle instead of Adobe.
RW Baird was also brought Adobe to
NEUTRAL from OUTPERFORM.
Microsoft’s 2.2% decline
was triggered by its below-
than-expected dividend
amount to be paid which worth $5.5
billion. Analysts pointed that the giant
software maker will have to be clear on
how the company will use the surplus
cash that it holds. Microsoft ended at
$24.61.
Deutsche Bank downgraded Goldman
Sachs’ 3Q EPS estimate to $1.95 from $3
but kept the BUY rating on the stock.
Weak 3Q earnings would be due to poor
trading conditions and “soft investment
banking”. Goldman tumbled 2.2% on the
downgrade, sending it to end at $148.07.
Starbucks ended down 0.88% at $25.93
on Wednesday. The company said that
soaring price of green coffee and also
rising commodity costs may lead to
22 September 2010
increases in the prices of
some of its products in
some certain markets.
The company will also
continue to promote its
products through the My
Starbucks Rewards
program which has started in January. On
its earnings outlook, the forecast
announced last July was reaffirmed. EPS
for fiscal 2011 is expected to be at $1.36
to $1.41 per share. The forecast already
factored in the rise in commodity costs.
AMD’s earnings estimates were lowered
by Gleacher & Co. to $0.71 from $1.01 for
fiscal 2011. Despite the downgrade,
Gleacher’s forecast is still above the
consensus estimate of $0.56. AMD was
kept at BUY, but the price target has been
lowered from $16 to $12. AMD was up
1.44% to end at $6.26. Other than AMD,
Gleacher also maintained Google at
NEUTRAL. Google ended at $516.00 or up
0.49%.
American Express was
started at POSITIVE with
price target set at $53 by
Susquehanna. Amex inched higher by
0.02% to $42.79.
market preview : global
Hong Kong and China will be closed on
Thursday. While Hong Kong will resume
trading on Friday, China will be back on
next Monday.
E-mail: market.techspeak@gmail.com
Page 3
 Market Gazer Hong Kong - Japan - Germany - UK - North America

Today’s data coming from US will include

jobless claims, existing home sales, and
leading indicators. Claims are expected to
stay at 450k, existing home sales are seen
rising to 4.1 million from 3.83 million, or
up 7.1% from a steep fall of 27.2% in July,
while leading indicators are seen to
advance 0.1% in August, the same pace as
July’s.

European data will cover Purchasing

Manager Index for manufacturing and
services, which will be released in France,
Germany, and Eurozone. The September
PMI for manufacturing are seen at 55.0,
57.6 and 54.5 for France, Germany and
Eurozone, respectively. All below prior
month’s readings. Service sector PMIs are
seen at 60, 57.2, and 55.5 for France,
Germany, and Eurozone, respectively.
Eurozone’s Composite PMI is seen lower
at 55.7 from 56.2.

Disclaimer: This report is provided for information purposes

only. It is not an offer to sell or to buy any securities. This
report has been prepared based on sources believed to be
reliable, but there is no assurance or guarantee regarding its
completeness & and accuracy. The author accepts no
responsibility or liability arising from any use of the report.

E-mail: market.techspeak@gmail.com
22 September 2010 Page 4