Issue link: https://maltatoday.uberflip.com/i/582103
maltatoday, WEDNESDAY, 7 OCTOBER 2015 11 Business Today www.creditinfo.com.mt info@creditinfo.com.mt Tel: 2131 2344 Your Local Partner for Credit Risk Management Solutions Supporting you all the way YOUR FIRST CLICK OF THE DAY www.maltatoday.com.mt Markets largely positive in Asia Markets in Asia were largely in positive territory on Tuesday fol- lowing a strong fi nish on Wall Street. Investors continue to see last week's US jobs figures as a sign the US Federal Reserve will not raise its rates until December at the earliest. In Japan, the benchmark Nikkei 225 index closed up 1% to 18,186.10. Investor sentiment was also buoyed in the region after a free trade deal was stuck between 12 Pacific Rim countries, the biggest in decades. The US-led Trans-Pacific Partnership (TPP) cuts trade tariffs and sets common standards in member countries including Japan and the US. Australia's S&P/ASX 200 benchmark closed 0.33% higher at 5,167.4. Investors mostly shrugged off news that Australia's trade deficit rose unexpectedly in August to 3.09bn Australian dollars ($2.18bn; £1.44bn) against forecasts for a deficit of A$2.55bn. The Reserve Bank of Australia (RBA) decided to keep its benchmark lending rate at an all-time low of 2% on Tuesday, but analysts said they would be looking for any hints of a December move when the minutes of the bank's meeting are released later this week. However, market analyst Evan Lucas said: "We think the [bank's] statement will be even duller than the rates release [today] as the RBA will not want to give anything away. "However, there is no escaping the fact that the market is building a case for a December cut, with the interbank market now pricing in a 60% chance that Australia will get a 25-basis-point cut [as a] Christmas bonus on 1 December." In Hong Kong, the benchmark Hang Seng index closed down 0.1% to 21,831.62 after being up more than 1% in early trade. The index was dragged down by shares of China Resources Enterprise, which fell 3.1%. Stock markets in mainland China remain closed for the Golden Week holiday. In South Korea, the Kospi index closed up 0.63% at 1,990.65. Turnover in selected services up 6.1% over second quarter last year In the second quarter, working-day adjusted turnover in selected serv- ices activities increased by 6.1 per cent over the corresponding period of 2014. Provisional seasonally ad- justed services turnover increased by 4.8 per cent. When compared to the second quarter of 2014, working-day adjusted turnover went up by 6.1 per cent. Turnover increased in all sectors, namely professional, scientific and technical activities (29.4 per cent), real estate activities (19.9 per cent), accommodation and food service activities (9.1 per cent), information and communication (7.7 per cent), administrative and support service activities (6.7 per cent), transportation and storage (5.5 per cent), motor trade (4.7 per cent), retail trade (3.2 per cent) and wholesale trade (2.8 per cent). Employment, gross wages and salaries and hours worked increased by 0.8, 3.0 and 1.2 per cent respectively over the comparative quarter of 2014. When compared to the previous quarter, seasonally adjusted turnover in the second quarter of 2015 increased by 4.8 per cent (Table 2). Increases were registered in information and communication (11.6 per cent), real estate activities (11.1 per cent), wholesale trade (7.5 per cent), professional, scientific and technical activities (7.2 per cent), administrative and support service activities (6.0 per cent), accommodation and food service activities (4.9 per cent), transportation and storage (2.7 per cent) and retail trade (1.6 per cent). A decrease of 3.8 per cent was registered in the motor trade sector. Seasonally adjusted employment, gross wages and salaries and hours worked increased by 0.4, 0.3 and 0.4 per cent respectively over the previous quarter. Volatility here to stay, is global economy strong enough for an interest rate hike? US stocks have been performing rather well over the past few trad- ing sessions, rallying despite a dis- appointing Jobs Report on Friday, and extending gains on Monday, with the S&P 500 posting on of the longest winning streak since the be- ginning of the year. Although the past few days have provided equity markets with some needed relief, investors continue to weight con- cerns over the real strength of the global economy and its ability to continue to grow over the next 12 to 18 months. This morning, unexpectedly disappointing economic data released by Germany prompted investors to take a pause after yesterday's rally, as traders pondered whether capitalize recent profits into cash, or remain invested in the market. The data released today showed that even Germany, Europe's largest economy and economic engine of the Eurozone, is exposed to a potential global slowdown led by widespread commodity weakness and a struggling Chinese economy. The disappointing German Factory Order data, which unexpectedly declined in August, is the second cold shower, after last Friday Jobs numbers, for optimistic investors who were hoping to ride an upward trend while waiting for the next pivotal FOMC's meeting scheduled in December. With economic data releases coming in weaker than anticipated, markets are expected to remain volatile, as some analysts and money managers do not see markets exiting the recent correction any time soon. This view is, shared by prominent fund managers and bond trading pioneer Bill Gross, who as recently as last week, stated that in his opinion US equities are likely to lose another 10%, unequivocally entering a bear market, dragged down by disappointing economic data and flat-lining earnings, which will be penalized by a global slowdown and a strong dollar. Mining, energy and commodities names are supporting the idea that market volatility is here to stay, as stocks in these sectors seems to have been riding a roller-coaster, with the S&P 500 Energy Sector Index plunging 93 points, losing close to 18% in August, despite rebounding in September, adding 51 points and closing yesterday 11.8% up from the lowest closing recorded on August 25th. An emblematic example of the current volatile environment can be found in Glencore Plc, one of the world's largest commodities conglomerate, whose stock price, although plunging over 28.5% Monday last week, following a broker's negative report, paired almost all losses throughout the week, and yesterday closed 18.29% higher. While long term value investors are likely to find interesting opportunities at attractive valuations, investors looking to capitalize on sizable price swings should exercise extra cautiousness, as stock markets recently appear to have been behaving as a casino's roulette. This article was issued by Paolo Zonno, Trader/Analyst at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri & Co. Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this newspaper.