Market Gazer Hong Kong - Japan - Germany - UK - North America

market review : global Bank of America Corp. recorded 3Q net loss of

$7.3 billion or 77 cents per share, worse than
the losses incurred a year ago which
Nikkei 225 Average closed up at 9,539.45 or
amounted to $1 billion or 26 cents per share.
0.4% higher on Tuesday as the positive impact
Consensus saw the earnings at 18 cents per
from better-than-expected earnings from
share initially. As if the pressure coming from
Citigroup boosted the market sentiment in
earnings was not enough, the company also
Japan. USDJPY still stuck at the low but
under pressure from Federal Reserve Bank of
managed to hold above ¥80.88 recent low.
New York to repurchase billions of dollars in
Chinese shares climbed 1.6% to finish at
home loans backing mortgage securities
3,000.85, helped by the upgrade from
issued by Countrywide Financial which was
UNDERWEIGHT to NEUTRAL at JP Morgan
bought by Bank of America in 2008. The
Chase & Co. and also Citigroup Inc. The
securities worth over $47 billion. Bank of
government’s decision to reduce quotas for
America tumbled 4.38% to $11.80.
rare earth exports by up to 30% in H1 next
year also boosted stocks. In Hong Kong, Hang
Johnson & Johnson
Seng index jumped 1.25% to close the day at
reported a net income of
23,763.70 or up 294.35 points.
$3.42 billion or $1.23 per
share against last year’s
China’s surprise rate
$3.35 billion of net
increase has rattled
both European and income or $1.20 per share. Revenue however,
declined 0.7% to $14.98 billion as product
North American
recalls (Tylenol, Benadryl, and Motrin) and
markets as the
slower sales of medical devices hurt sales. The
People’s Bank of China (PBOC) stepped up its
market had expected revenue at $15.24
efforts to control inflation in China. Borrowing
billion and earnings of $1.15 per share. For
costs have been raised from 5.31% to 5.56%
2010 forecast, the company saw earnings in
(1-year lending rate) and the deposit rate has
between $4.70 to $4.80 per share while sales
been raised to 2.5% from 2.25%. The
are seen to be flat at $62 billion.
questions now are: “Why now?” and “How far
would the rate hike carried out by the PBOC?”
Sales at Yahoo were flat in 3Q at $1.12 billion
Also: “How would the change impact the
compared to last year’s
Chinese economy?”
$1.13 billion. Net income
German DAX tumbled 25.94 points or 0.4% to however, was up to $396.1
million or 29 cents per
end at 6,490.69, FTSE 100 fell to 5,703.89 or
share, up from $186.1
38.63 points (-0.67%), and the Dow Jones
Industrials shed 165.07 points (-1.48%) to million or 13 cents per share. Earlier,
consensus saw earnings of 15 cents per share
finish at 10,978.60. Tech-dominated Nasdaq
with revenue at $1.13 billion. For its 4Q
ended at 2,436.95 and S&P 500 settled at
1,165.90. The negative impact from the rate outlook, Yahoo saw net revenue in between
$1.1 billion and $1.2 billion, slightly lower
hike is expected to spill over to the Asian
than the consensus of $1.26 billion. Yahoo
markets on Wednesday.
ended down 2.73% on normal session but

E-mail: market.techspeak@gmail.com
19 October2010 Page 1
 Market Gazer Hong Kong - Japan - Germany - UK - North America
gained 1.03% at $15.65 in the extended hours
session.
Coca-Cola booked 3Q net profit of $2.06 bln
or 88 cents per share, better than last year 3Q
profit of $1.9 billion or 81 cents per share.
Excluding items, profit was at 92 cents, better
than the expected 89 cents. In addition, $2
billion worth of shares will be repurchased,
higher than the $1.5 billion stated earlier.
Eurasia and Africa contributed growth of 12%,
while North American sales were up 2%,
reversing last year’s decline of 2%. Sales rose
to $8.43 billion, with global sales up 5%,
reversing 4% drop last year. China and Japan
contributed 12% and 11% growth in volume,
respectively.
Goldman Sachs scored
net profit of $2.98 per
share in 3Q, beating
estimates of $2.29 per
share as net income
decline to $1.9 billion.
GS’s revenue from FICC (fixed-income,
currencies and commodities) declined 14%
from 2Q and fell 37% from last year to $3.77
billion, but the amount beat rivals JP Morgan,
Bank of America and Citigroup. Equities-
trading revenue advanced 53% from 2Q to
$1.86 billion, beating analyst’s expectation at
Hintz of $1.33 billion. Revenue from advisory
unit rose to $496 million from $472 million
(Q2) and from $325 million (Q309), revenue
from debt underwriting also up to $335
million from $223 million (Q2) and equity
underwriting revenue was at $288 million, up
from $222 million (2Q).
Volkswagen’s plan to merge with Porsche may
have to wait longer as the companies must
deal with U.S. lawsuits and German tax issues
first. The merger was initially scheduled for
19 October2010
next year, but now the merger date will have
to wait until both problems have been solved.
Wal-Mart was
reportedly planning to
sell bonds worth $5
billion. According to
Fitch Ratings which assigned an AA rating to
the bonds, the company will sell 3-year, 5-
year, 10-year, and 30-year bonds.
China Shenhua Energy Co. reported
September coal output of 19 million tons,
9.8% higher than the same month a year ago.
Coal sales in September were up 6.8% in
September (y/y) to 25.2 million tons, with 0.9
million tons were shipped overseas.
economic data
On the economic front, German ZEW Survey
on economic sentiment showed that
sentiment fell from -4.3 to -7.2 in October.
The market expected a drop to -7.0. On
current situation, the index jumped from 59.9
to 72.6, exceeding the expected reading of
64.0.
U.S. data on Tuesday featured building
permits which fell 5.6% in September after an
increase by 2.1% in August, while housing
starts unexpectedly held on the positive side
at +0.3% against the market expectation of a
fall by 3%.
In HK, unemployment rate during 3Q was at
4.2%, higher than the expected 4.1%. Strong
jobs growth was offset by the expansion in
the labor force.
upgrades & downgrades 
Apple Inc. has been downgraded to
SECTOR PERFORM from OUTPERFORM at
E-mail: market.techspeak@gmail.com
Page 2
 Market Gazer Hong Kong - Japan - Germany - UK - North America
Scotia Capital on the back of falling gross
margins. At Argus, Apple’s target has been
raised to $375 from $300 while
maintaining a BUY rating. Canaccord rated
Apple at BUY, raised 2011 estimates to
$18.44/$89.3 bln from $18.31/$83.3 bln
while 2012 is expected at $21.06/$103.1
bln up from $21.03/$95.6 bln. RBC raised
Apple’s target from $350 to $365 and
maintained it at OUTPERFORM. Sterne
Agee raised Apple’s target to $350 from
$320 and kept its rating at BUY. Citigroup
raised Apple’s price target to $390 from
$350 and put Apple at BUY. DB said that
gross margin concern has been
overblown, while JP Morgan expected
near-term pressure on Apple.
Intel Corp. has been downgraded to
MARKET PERFORM from OUTPERFORM at
First Global. Intel also said to be spending
$6 billion to $8 billion on manufacturing
technology.
AMD has been maintained at NEUTRAL at
UBS, with price target set at $7.25. Solid
expense controls were the factor behind
the assessment.
Walt Disney has been kept at HOLD at
Citigroup, with price target raised from
$37.00 to $39.99.
Citigroup sets Google’s price target at
$725 through 2011 as more positive
fundamental trends are expected to be
seen. The stock has been assigned a BUY
rating. Meanwhile, Goldman Sachs raised
Google’s price target from $625 to $700.
GS kept the stock at BUY while revising
the EPS estimates to $29.59 (2010),
$34.09 (2011) and $38.54 (2012).
McDonalds was put on PERFORM at
Oppenheimer, with weaker dollar seen
benefiting the company.
General Electric was set at BUY with price
target at $19 on the back of lower tax rate
and improvement in aerospace demand.
19 October2010
Credit Suisse cut GE’s 2011 EPS estimates
to $1.32 but raised 2010 EPS estimate to
$1.32. At OUTPERFORM, GE is expected
to hit $22.00 by CS.
IBM’s price target has been raised by JP
Morgan to $150 while maintaining the
OVERWEIGHT rating.
Pfizer’s price target raised to $20.00 by
Goldman Sachs with rating reiterated at
BUY as the company is seen growing
through more acquisitions.
Wal-Mart’s EPS estimates have been
lowered with price target set at $63. The
stock was kept at BUY.
CLP Holdings Ltd. reported a 16% increase
in revenue during the first 9 months 2010
compared to the same period a year
earlier. Revenue amounted to HK$43.50
billion, up from 2009’s HK$37.62 billion.
3Q dividend was proposed at HK$0.52,
unchanged from last year.
Nintendo Co. gained nearly 1% to ¥21,030
following its placement at OVERWEIGHT
by JP Morgan yesterday. 3DS handheld
game player is expected to boost the
stock later on, sending the shares to the
target of ¥27,000.
BOCI raised China Shenhua’s price target
to HK$39.54 as the forecast of domestic
thermal coal price has been raised by 9%
for 2010 and 14% for 2011.
Hutchison’s target has been raised by
Credit Suisse to HK$100 from HK$72.
Citic Pacific has been raised to BUY from
SELL by Citigroup, with price target raised
to HK$24.00 from HK$15.90.
Sino Land’s price target has been raised
from HK$16.80 to HK$20.06 at Daiwa.
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
Page 3