Bloomberg Japan Business Confidence Rebounds; Demand for Services Rises

June 22 (Bloomberg) -- Japanese manufacturers became less pessimistic this quarter and demand for services rose in April amid signs the country’s worst postwar recession is easing.

Sentiment was minus 13.2 points this quarter compared with minus 66 three months earlier, a joint survey by the Cabinet Office and Finance Ministry showed today. The tertiary index, a gauge of money spent on phone calls, power and transportation, climbed 2.2 percent from March, the Trade Ministry said.

The Nikkei 225 Stock Average has climbed 39 percent since dropping to a 26-year low on March 10, buoyed by speculation $2.2 trillion in stimulus spending by governments worldwide will rekindle overseas demand for Japanese products. Tax breaks and shopping incentives introduced by Prime Minister Taro Aso have helped lift consumer confidence to a 14-month high.

“There’s a recovery on the way for Japan,” said Jan Lambregts, head of Asian research at Rabobank International in Hong Kong. “There’s a lot of stimulus there and that will help, but not all of the growth is coming back.”

The yen traded at 96.12 per dollar as of 8:55 a.m. in Tokyo from 96.08 before the reports were published. A negative reading on business confidence means pessimists outnumber optimists.

Easing pessimism among Japan’s manufacturers has much to do with the outlook for China, where $586 billion in government spending on construction projects and consumer incentives is feeding demand for Japan’s heavy equipment, cars and materials. The World Bank last week raised its growth forecast for China to 7.2 percent from a March estimate of 6.5 percent.

Stimulus Fillip

Japanese companies are already benefiting. Nissan Motor Co.’s sales to China rose 37 percent in April from a year earlier. About two-thirds of the cars the company sells in China are eligible for a government subsidy that halves the sales tax on vehicles with smaller engines.

Japan’s own stimulus measures -- 25 trillion yen ($260 billion) pledged since October -- have started to take hold. Sales of electronics are by up 18 percent since the government last month introduced a program to encourage consumers to buy eco-friendly products, according to Tokyo-based researcher Gfk Marketing Service Japan Ltd.

Industrial production rose at the fastest pace in 56 years in April as companies replenished stockpiles they managed to run down during the worst of the export collapse. The rebound in output prompted the Bank of Japan and the government to raise their assessments of the economy in the past two months.

Smaller Economy

Still, two quarters of record contractions in gross domestic product have shrunk the economy down to its 2003 size. Exports and production have fallen by more than a third from last year’s levels.

That’s putting pressure on managers to cut jobs and forcing companies to slash investment, spending that would normally trickle down to the smaller business that make up 70 percent of the economy. A survey published this month by the Nikkei newspaper showed companies, saddled with equipment they no longer need, plan to cut capital spending by an unprecedented 15.9 percent this business year.

“Consumer spending will probably stay relatively solid in coming months, supported by stimulus measures,” said Masamichi Adachi, a senior economist at JPMorgan Chase & Co. in Tokyo. “But it’s highly likely to weaken as the wage and labor market deteriorate further.”

The unemployment rate rose to a five-year high of 5 percent in April and economists surveyed by Bloomberg expect it to climb to a record 5.8 percent next year. About two work seekers are competing for a single spot, the most severe job shortage on record.

Today’s business confidence report offers a hint of the results likely in the Bank of Japan’s Tankan survey due July 1. That report, the nation’s most closely watched gauge of corporate confidence, will show sentiment among large manufacturers improving from March’s record low, according to economists surveyed.

To contact the reporters on this story: Jason Clenfield in Tokyo at jclenfield@bloomberg.net ; Toru Fujioka in Tokyo at tfujioka1@bloomberg.net

Bloomberg Bumi Resources Seeks Approval on Asset Pledge: Week Ahead

June 22 (Bloomberg) -- PT Bumi Resources, Asia’s largest power-station coal exporter, will seek approval from shareholders to pledge assets to get loans.

Investors at the June 26 meeting will decide whether to use assets, including shares in units, inventory and escrow accounts, as collateral for “current or future” financing, the company said in a June 5 filing to the Indonesia Stock Exchange.

Bumi owns majority stakes in two coal miners, which account for about a quarter of the output of Indonesia, the world’s biggest exporter of thermal coal. The shareholder meeting was initially scheduled to take place in February.

Bumi in January announced three transactions valued at 6.12 trillion rupiah ($586 million). The company has said it would seek to renegotiate the price of one of the acquisitions after Indonesia’s market regulator said it was paying more than the
value of the company.

In the June 26 meeting, shareholders will also vote on the dividend distribution from 2008 earnings and changes in board of commissioners.


For Related News and Information:
Stories on Bumi Resources: BUMI IJ CN
Most-read Indonesian stories this week: MNI INDO 1W

[BRIGHT INFO] "Just a Note"

Good day to you.

The DJAI fell 0.19 %. But the S&P added 0.31 % and the Nasdaq rose 1.09 %. DJIA Loses 3 % for the week.

Major Southeast Asian stock markets rose on Friday as index heavyweights attracted bargain hunters, with Singapore ending a six-day fall and Thai stocks up after interest rate comments from the Bank of Thailand.

Markets in the region tracked improving sentiment elsewhere in Asia as U.S. factory and jobs data provided more evidence that the global economy was starting to recover from its deep recession.

Recent sell-offs in Southeast Asian stocks had led to cheaply valued shares but investors were still looking for fresh reasons to buy. A U.S. Federal Reserve policy meeting next week may provide such a trigger, with signals on the economy.

The Indonesian index JCI was up 2 % on Friday, ending a 6.8 % fall over the previous four days, pushed up by a 4 % surge in Astra International and a 7.5 % gain in top lender Bank Mandiri.

Crude oil for July delivery fell $1.82, or 2.6 percent, to $69.55 a barrel on Friday on speculation that supplies of the motor fuel will climb as refineries bolster output and imports gain. Coal on Newcastle Port tumbled 7.74% from last week to $70.81. Tin fell 0.8 % to $14,825 a ton, while nickel rose 1.3 % to $15,200 a ton. Malaysian palm oil futures ended softer on Friday for the third consecutive day, touching a new 10-week intraday low.

Nothing changes on our fundamental economic but we must watch political situation carefully. Rupiah movement was one of trigger on our market. After surged at 10600 on Friday Morning rupiah pull back and strengthen to 10300.

My Top Pick is still same, TLKM, ANTM, INCO, TINS, BUMI, BNBR, and DEWA. Start Looking for BBRI, UNTR and PGAS as government wants 90% dividend from net profit. Especially on TINS, I think TINS will be very attractive this week with around 6% dividend yield.

“Do we need to rest here? Do we need to pull back? Or can it continue? "


[Personal Opinion ]
=====================================================================================
DISCLAIMER: This report is issued by [BRIGHT INFO]. Although the contents of this document may represent the opinion of [BRIGHT INFO]. We cannot guarantee its accuracy and completeness.

Reuters Soros says worst of global crisis is "behind us"

WARSAW (Reuters) - The worst of the global economic crisis is over, multi-billionaire financier George Soros told Polish news channel TVN24 on Sunday urging the creation of international regulations to oversee global markets.

"Decidedly the worst (of the crisis) is already behind us," said Soros, a 78-year-old Hungarian-born American with Jewish roots.

He did not elaborate but went on to stress the uniqueness of the current economic turmoil.

"This is not like previous crises but marks the end of an era. The system to date had been based on the false assumption that markets can independently regain their equilibrium and that the system is self-correcting," he explained.

He also said the regulation in the economy should be aimed at controlling market bubbles.

"We need international regulations to retain international markets. This won't be easy...If we won't be able to do this... than globalization, as we now know it, will fall apart," he said.

To deal with the current crisis he said "the state must step in, give guarantees to financial institutions and increase government spending," adding that he supported anti-crisis measures undertaken by the U.S. administration.

Since that could create a risk of hyperinflation he said the state must diminish its role once the credit system is restored. more...

Reuters S and P, Nasdaq gain on Microsoft; stocks slip for week

NEW YORK (Reuters) - The S&P 500 and Nasdaq rose on Friday as positive broker comments on Microsoft boosted technology shares, but the major averages lost ground for the week for the first time in five weeks.

After a sharp three-month rally, indexes eased this week as investors increasingly questioned if stocks are due for a correction. Worries that the economic recovery could be tepid have dented optimism that has driven the S&P 500 up as much as 40 percent from March's 12-year low.

"We've had the survival bounce and the end of the month-after-month declines in economic data," said Bucky Hellwig, senior vice president at Morgan Asset Management, in Birmingham, Alabama.

The Dow Jones industrial average .DJI fell 15.87 points, or 0.19 percent, to 8,539.73. But the Standard & Poor's 500 Index .SPX added 2.86 points, or 0.31 percent, to 921.23. And the Nasdaq Composite Index .IXIC rose 19.75 points, or 1.09 percent, to 1,827.47.

DOW LOSES 3 PERCENT FOR THE WEEK more...