• Tag Archives Hong Kong
  • Gold Market Morning: June-21-2017: Gold still stabilizing below $1,250

    Gold Today – New York closed at $1,243.50 yesterday after closing at $1,251.5 yesterday. London opened at $1,246.00 today.
    Overall the dollar was slightly stronger against global currencies, early today. Before London’s opening:
    – The $: was slightly stronger at $1.1145 after yesterday’s $1.1155: 1.
    – The Dollar index was stronger at 97.66 after yesterday’s 97.57.
    – The Yen was stronger at 111.14 after yesterday’s 111.39:$1.
    – The Yuan was slightly weaker at 6.8264 after yesterday’s 6.8258: $1.
    – The Pound Sterling was weaker at $1.2627 after yesterday’s $1.2659: 1.
    Yuan Gold Fix
    Despite the central Bank in Hong Kong statement of yesterday that it wanted a stable exchange rate to the dollar, the Yuan has weakened a little in the last two days. This does not mean the policy has changed, just as it will not be a fixed exchange rate.
    What is becoming clear is that Shanghai’s pricing power over the gold price is being proved this week and last, as it has been leading the way both ways.

    This post was published at GoldSeek on 21 June 2017.


  • Hong Kong Warns: Its Housing Bubble is a ‘Dangerous Situation’

    The HK financial system is ‘very strong’ and ‘can withstand an adjustment in the property market.’
    The Hong Kong dollar is pegged to the US dollar. Hong Kong’s monetary policy is follows the Fed’s monetary policy. The Fed has embarked on a tightening cycle, raising rates four times so far. The Hong Kong Monetary Authority has followed each time. Last week, it raised its policy rate by 25 basis points to 1.5%. This will have consequences for the most expensive and ludicrously inflated housing bubble in the world.
    ‘We have to warn our people about the dangerous situation of the property market at the moment,’ Hong Kong Financial Secretary Paul Chan told Bloomberg TV.
    ‘No one can tell how deep the adjustment will be or what is the appropriate level of adjustment because it is market force,’ he said. ‘It is not up to the government to dictate, but I think it is important for people to recognize it is risky.’
    But he doesn’t expect a repeat of what happened when Hong Kong’s prior housing bubble imploded during the Asian Financial Crisis.

    This post was published at Wolf Street on Jun 20, 2017.


  • Gold and Silver Market Morning: June 19 2017 – Gold stabilizing around $1,250!

    Gold Today – New York closed at $1,256.50 Friday after closing at$1,254.60 Thursday. London opened at $1,250.20 today.
    Overall the dollar was slightly weaker against global currencies, early today. Before London’s opening:
    – The $: was slightly weaker at $1.1188 after Friday’s $1.1174: 1.
    – The Dollar index was slightly weaker at 97.24 after Friday’s97.34.
    – The Yen was stronger at 111.18 after Friday’s 111.31:$1.
    – The Yuan was almost unchanged at 6.8154 after yesterday’s6.8152: $1.
    – The Pound Sterling was stronger at $1.2780 after yesterday’s $1.2774: 1.
    Yuan Gold Fix
    New York closed at almost the same level as Shanghai did on Friday. This morning see Shanghai $3 higher, but London ahead of its open was trying to pull the price down a few dollars to $1,250, trying to guess the opening mood in London.
    Hong Kong’s central bank has stated that it prefers a stable exchange rate against the dollar. It is not independent of Shanghai and, judging by today’s exchange rate the People’s Bank of China agrees as we see the Yuan virtually unchanged today. This will allow us to see more clearly the differences between the Shanghai gold Exchange prices and London and New York.

    This post was published at GoldSeek on 19 June 2017.


  • Demand For Hong Kong Micro Apartments Surges As Buyers “Downgrade Expectations”

    The surge in Hong Kong housing costs has lifted home prices well beyond the bounds of affordability for most local families and young professionals, leading to long lines at housing sales that were sometimes oversubscribed by as much as 15x. But while home prices have risen for every type of home, Bloomberg notes that the intensifying demand for micro-apartments – some of which are as small as 128 square feet (about the size of a garden shed) – has caused prices for this segment of the housing market to climb more quickly than normal-sized homes. Why? Because they’re practically all Chinese buyers can afford.
    ‘The pool of buyers for small flats is getting bigger and bigger because people have to downgrade their expectations of the size of flats they can live in,’ said Nicole Wong, regional head of property research at CLSA Ltd. in Hong Kong. One 161 square foot micro apartment sold by property giant Henderson Land Development Co. was bought for just under $500,000. For that amount, buyers would be better off sleeping in their cars. Specifically, a Tesla Model X, which, as Bloomberg notes, is about 160 square feet, the same size of the above-mentioned apartment. Bizarrely, this is one instance where a Tesla Model X might be considered a bargain: They start at $150,000 in Hong Kong.

    This post was published at Zero Hedge on Jun 16, 2017.


  • FANG Stocks Slammed After Goldman Warns Of “Valuation Air-Pocket”

    Update: FANG Stocks are getting hammered today.
    The fascination with the influence of a handful of giant tech stocks on the overall markets continued overnight, when one day after Bank of America found that the tech sector is now the “most overweight it has ever been“, surpassing even the record clustering into tech during the dot com bubble, Goldman issued a report looking at the outsized influence of the five tech stocks in question which it dubs FAAMG – Facebook, Amazon, Apple, Microsoft and Alphabet, which have collectively added a total of $600 bn of market cap this year, “or the equivalent GDP of Hong Kong and South Africa combined.”
    This is also the group of names which we reported last month is what virtually every brand name hedge fund purchased in the first quarter based on 13F filings, as active managers abandoned “value” names and factors and rushed into “momentum” and “growth.”

    This post was published at Zero Hedge on Jun 9, 2017.


  • China’s gold imports seen jumping 50% as haven demand booms

    China, the world’s biggest gold market, may boost imports through Hong Kong by about half this year as local investors seek to protect their wealth from currency risks, a slowing property market, and volatile stocks, according to the Chinese Gold & Silver Exchange Society.
    Mainland China is set to import about 1,000 metric tons from the territory in 2017, said Haywood Cheung, president of the century-old exchange in Hong Kong which trades physical gold and silver. That compares with net purchases of 647 tons last year and would be the biggest since 2013, data from the Hong Kong Census and Statistics Department compiled by Bloomberg show.
    Demand is rising on concerns over property, share and bond markets and the outlook for the yuan, amid a government drive to reduce leverage in the financial system. Local consumption was up 15 percent in the first quarter, with sales of bars for investment climbing more than 60 percent and dwarfing a 1.4 percent rise in jewelry buying, according to data from the China Gold Association. China also imports gold from Switzerland.

    This post was published at bloomberg


  • Carson Block Triggers A Small Panic In Hong Kong After Teasing His Latest Short

    Short-seller Carson Block triggered a small panic in Hong Kong on Tuesday after he told Bloomberg that he had identified a new short play listed in the former British colony.
    His comments triggered a flurry of speculation in the city’s $4.6 trillion equity market, Bloomberg reported. The Hang Seng Composite Index dipped shortly after Block appeared on Bloomberg. Shares of Tongda Group Holdings Ltd., Man Wah Holdings Ltd. and Sunny Optical Technology Group Co. tumbled on concerns that they could be in Block’s crosshairs. For his part, Block said he will reveal his latest short at the Sohn Hong Kong conference on Wednesday.

    This post was published at Zero Hedge on Jun 6, 2017.


  • Hong Kong needs around-the-clock gold trading

    The HKEX has presented proposals for two new gold futures products, to be launched as early as July, which would trade 16 hours a day. But brokers say that might prove too short.
    “The gold market trades around the clock. This is why our customers are trading at CME Group (Chicago Mercantile Exchange) in the United States, which trades 23 hours a day,” said Alfred Yeung Ping-kwan, founding chairman of Glory Sky Group, which trades gold and stocks for investors in Hong Kong.
    HKEX this month said it would start offering two new gold futures contracts — one in U.S. dollars the other in yuan — with physical delivery.

    This post was published at South China Morning Post


  • Beware the Muni Bond Bubble

    Municipal Bonds are in trouble in Europe as well as the United States. The local level cannot print money, nor are they ever capable of managing their economies. The general view is when short, just raise taxes. Everything comes to an end and we are looking at the end of a Muni-Bond Bubble. The strongest possible recommendation is get out before it is too late. Sure, not every municipality or state/province is in trouble – YET! Once the muni bond bubble bursts, there will be a contagion so even the ones that are not yet insolvent will tip over.
    In the States, sell California and New England. The higher the tax rate, the deeper their debt will fall. Connecticut, for example, is hopeless as is New Jersey, New York, and just about all New England States. I was flying home from Hong Kong and upon landing in Newark, the next leg was back to Florida. I sat next to a woman from Connecticut who was going to visit her brother. She had a 1950s house 1600 square feet with taxes over $8,000 and could no longer afford to stay there for retirement. She was leaving as most people these days in what I call the Great Migration.

    This post was published at Armstrong Economics on May 30, 2017.


  • Greek, Italian Risks Weigh On European, Global Markets; Oil, Gold Slide

    Tuesday’s session started off on the back foot, with the Euro first sliding on Draghi’s dovish comments before Europarliament on Monday where he signaled no imminent change to ECB’s forward guidance coupled with a Bild report late on Monday according to which Greece was prepared to forego its next debt payment if not relief is offered by creditors, pushing European stocks lower as much as -0.6%. However the initial weakness reversed after Greece’s Tzanakopoulos denied the Bild report, sending the Euro and European bank stocks higher from session lows. S&P futures are fractionally lower, down 3 points to 2,410.
    Elsewhere, the Japanese yen rallied after strong retail sales data while US Treasuries ground higher after returning from a long weekend largely unchanged; Australian government bonds extend recent gains as 10-year yield falls as much as four basis points to 2.37%. Asian stock markets and were modestly lower; Nikkei closed unchanged despite a stronger yen. China and Hong Kong remained closed for holidays while WTI crude was little changed.
    Despite the rebound, the Stoxx Europe 600 Index declined a fourth day as data showed that contrary to expectations of a record print, euro-area economic confidence fell for the first time this year, and as Draghi’s dovish comments to the European Parliament weighed on banking shares. As discussed yesterday, Italian bonds edged lower as traders digest the prospect of an earlier-than-expected election.

    This post was published at Zero Hedge on May 30, 2017.


  • Hong Kong’s Housing Market Has Become “A Sea Of Madness” Central Bank Warns

    A HK new home sale site queues with over thousand of buyers.
    Last time this happened in 1997. pic.twitter.com/DHtH897ga9
    — Simon Ting (@simonting) May 26, 2017

    What a difference 16 months makes.
    It was in February of 2016 when, looking at the latest trends in the Hong Kong housing market, we wrote that in January [2016] Hong Kong home prices tumbled the most since July 2013, and after a 12 year upcycle, prices were now down 10% from the recent peak just four months prior…
    … while the local Centaline Property Agency estimated that total Hong Kong property transactions at the start of 2016 were on track to register the worst month on record.
    Fast forward to today when that particular blip is long forgotten, swept away by the record credit injection unleashed by China in the interim, which has spilled over into the Hong Kong’s housing market where instead of concerns about a bubble bursting, the locals are preoccupied with chasing the latest, and biggest yet, housing bubble to form in Hong Kong, as crowds of people line up in hope of being the winning bidder for one of several properties for sales, some of which are oversubscribed as much as 15x.

    This post was published at Zero Hedge on May 29, 2017.


  • Markets Wrap: Stocks Flat In Quiet Session With US, UK And China Closed For Holiday

    U. S. markets are closed for the Memorial Day holiday, and with UK and Chinese markets also closed for various holidays, it has been a quiet start to the week, with S&P futures essentially unchanged, trading at 2,415, up 0.06%, a new all time high.
    European stocks opened marginally lower in quiet trading but have since erased the dip to trade little changed, while shares in British Airways owner IAG dipped in early Spanish trading as the airline pushed to recover from a massive technology failure that disrupted hundreds of flights. The Stoxx Europe 600 Index was flat at 391.24, down 0.03%. Italian assets underperformed after Renzi comments on early elections, with banks selling off and bund/BTP spread widening. BTP futures have extended their slide in thin liquidity, with the 10y yield now higher by 7bps fueled by Renzi comments and supply concession. The Italian FTSE MIB fell 2% with traders citing rising risks that the euro zone’s third largest economy could head to early elections in the autumn. “The latest news out of Italy seems to suggest that a new electoral law is indeed in the making,” LC Macro Advisers’ founder Lorenzo Codogno says. “The four major parties appear to converge towards the so-called German system, i.e. a purely proportional system with a 5 percent entry threshold.”
    In Asia, South Korea’s Kospi fell for the first time in seven sessions, slipping from an all time high. North Korea tested another missile although the launch had little impact on risk assets. Australian bonds pared opening gains and slip into negative after sluggish 20-year auction; 10-year yield rises two basis points; ASX 200 down. Nikkei little changed; Chinese developers surge in Hong Kong. Chinese developers lifted the Hang Seng Index, with China Evergrande Group surging to a record in Hong Kong. Bunds have meandered through the session with a speech from the ECB president Mario Draghi at 2:00pm BST in focus, but volumes are also especially light.

    This post was published at Zero Hedge on May 29, 2017.


  • GOLD’S DAYS OF GLORY BEGINNING AS DOLLAR’S ARE ENDING

    Since the 2011 tops, precious metals investors have had their patience severely tested. Six years later, silver is down 66% from the $50 peak and gold 35% off the $1,920 peak. We mustn’t forget off course that these metals started this century at $280 and $5 respectively. But that is no consolation for the investors who got in near the highs. The best time to buy an asset is when it is unloved and undervalued like gold and silver were in the early 2000s. What few investors realise is that the current levels of gold and silver, when real inflation is taken into account, are very similar to where the metals were in 2000-2. Thus gold at $1,265 and silver at $17 is an absolute bargain and unlikely to remain at these levels for long.
    Why are asset markets booming and gold static?
    As the precious metals have corrected for six years, many markets have boomed. Money printing and credit creation can do wonders to asset markets. Since 2009, stocks in the US for example have trebled and many other asset classes such as property have appreciated substantially. Global debt since 2006 is up by 75% or $100 trillion and short term and long term rates in the Western world re down from 5-6% to anywhere from negative to around 2%. This has fuelled stocks and property but so far had limited effect on gold and silver.
    It was the sub-prime mortgage market that started the 2006-9 crisis. Since then, there are property bubbles in many parts of the world. Canada, Australia, UK, Scandinavia, Hong Kong and China all have property markets which are likely to crash in the next few years together with the US one which is still a bubble.

    This post was published at GoldSwitzerland on May 26, 2017.


  • RBC Explains What The Hell Is Going On: “Prudent” Fed & Chinese Intervention

    A “prudent” Fed (and China’s “National Team”) have spurred a risk-on rally, as RBC’s head of cross-asset strategy Charlie McElligott notes the market’s ‘Pavolovian’ response to Fed’s ‘dovish hints’ contained within the Minutes – despite simultaneously staying ‘on message’ with hiking / tapering commentary – prompts a “QE of old” response: stocks and Treasuries bid, while the USD faded.
    China further perpetuates the ‘risk rally’ via apparent market interventions:
    1. Intervention in FX markets to strengthen the Yuan overnight, with speculation of a number of Chinese banks selling Dollars in the onshore market overnight which drove the Yuan higher.
    2. Chinese ‘National Team’ stock market inventions as well, with sharp-turns higher off of an initially weaker equities opening and again-weaker industrial metals. Major reversals off lows saw nearly all domestic markets close at highs (Shanghai Prop +2.8%), while Hong Kong’s Hang Seng closed at highs since July 2015, with Chinese real estate developers leading.
    Initial (and expected) ‘sell the news’ on the snoozer OPEC outcome, as they extend the output cut 9 months per expectations – which disappointed the ‘bullish surprise’ camp which anticipated more OPEC-‘gaming’ of the market, thinking it was possible for a deeper-cut in conjunction with the consensus extension.

    This post was published at Zero Hedge on May 25, 2017.


  • From West to East: Asia Gobbling Up Gold as US Exports Surge

    Gold exports from the US nearly doubled in the first two months of 2017 compared to last year. Where is all of this gold going? Most of it is heading east.
    Total US gold exports in the first two months of 2017 totaled 101 tons. That compares with 56.5 metric tons in 2016. Nearly two-thirds of the gold flowing out of the US ended up in Asia. China and Hong Kong imported 51 tons of US gold, and India gobbled up another 10.8 tons. Switzerland was the leading non-Asian purchaser of US gold, importing 28 tons. England imported 5.6 tons of US gold, and the UAE took in 3.3 tons. The remaining US gold exports went to countries such as Germany, Canada, and Mexico.
    To put things into perspective, gold exports to China, Hong Kong, and India doubled in the first two months of 2017 compared to the same period the previous year.

    This post was published at Schiffgold on MAY 11, 2017.


  • LME to introduce gold and silver trading on July 10

    London Metal Exchange, a subsidiary of Hong Kong Exchanges and Clearing, will launch gold and silver spot and futures trading in London on July 10 in a bid to capture the increasing demand for trading of precious metals in London, the exchange said today.
    The LME gold and silver product will launch at a time when HKEX is planning to introduce gold futures in the third quarter of this year should it secure approval from the Securities and Futures Commission. The trading in the two markets, however, would remain separate, and there will be no cross trading.
    “The HKEX and the LME gold products would be traded in different markets and different time zone,” said Kate Eded, LME head of precious metals who was speaking at a workshop in Hong Kong on Monday.
    The gold and silver contracts to be launched at the LME would be traded in U.S. dollar, which will include spot trading and trading of future contracts with a maturity of up to five years.

    This post was published at South China Morning Post


  • Hong Kong exchange tries gold futures again, with physical delivery this time

    Hong Kong Exchanges and Clearing will undertake in the third quarter its third attempt to launch a gold futures contract after two previous failures, but traders have mixed views on its chances for success.
    HKEX, which operates the local stock and futures markets, on Monday will kick off promotional efforts for a range of workshops and seminar for brokers, investors and media as part of its plan to launch two new gold futures contracts – one in US dollars and one in yuan – with physical delivery.
    This will be the third attempt by the local bourse to launch a gold futures contract. The exact launch date will be subject to regulatory approval by the Securities and Futures Commission, HKEX said on Friday. It also said its London’s subsidiary London Metal Exchange will launch a gold futures contract in July.
    The last attempt by HKEX to launch a gold futures contract was during the financial crisis in October 2008, but it was scrapped in March 2015 after little interest and no turnover at all for the whole of 2014.

    This post was published at South China Morning Post


  • Swiss gold imports: anomalous suppliers — Lawrie Williams

    We commented yesterday on the March Swiss gold export figures which confirmed India as the largest recipient of the gold from the Swiss refineries, which dominate global independent gold refining. Hong Kong and China were the two other major recipients, while overall the Middle East and South and East Asia accounted for almost 88% of total Swiss gold exports, emphasising the continuing flow of gold from West to East. (See: March Swiss gold exports show India no.1 again).
    As Switzerland produces no gold of its own, but specialises in re-refining LBMA good delivery gold bars and scrap gold into the metric and small sizes in demand in the East, it has to be a major gold importer to keep the refineries’ production going, as well as to supply its own investment demand and it is particularly interesting to review the sources of this gold for re-refining and exporting.
    The biggest source of Swiss gold imports is usually the U.K., which is not surprising as London has traditionally been at the centre of the global gold trade, but some of the other sources of gold for the Swiss refineries are a little more unexpected. After London the three biggest sources of imported gold are Hong Kong, the UAE (primarily Dubai), and the USA. The latter is not surprising at all as it is the world’s fourth largest producer of new mined gold, but the UAE and Hong Kong have to be considered as highly anomalous sources as they both produce little or no gold of their own, but are traditionally gold traders. Next in line comes Thailand – again usually a gold importer rather than exporter. Most of the remainder of the source nations for the Swiss gold imports are indeed gold producers as would be expected.

    This post was published at Sharps Pixley


  • Meanwhile In Hong Kong…

    The Hong Kong Dollar has plunged to its weakest level against the dollar (to which it is pegged) since February 2016, even as the Hang Seng surges higher. As HKD nears 7.80, triggering likely HKMA intervention, we wonder whether we will see a replay of last year’s liquidity-driven stock market slump.
    In January last year, the HKMA stepped in to defend the currency from weakening too much. As SCMP reports, this came after the Hong Kong dollar fell to an eight-and-a half year low to 7.8924 per US dollar amid worries over capital outflows after US interest rates were lifted in December 2015. The result was a sharp fall in the Hong Kong stock market.
    The Hong Kong dollar then entered a period of relative stability, before rebounding in the second half of 2016 as the euro and pound retreated against the US dollar. Fast forward to today and we find that the situation is once again changed. Major global currencies are rising against the US dollar. Hong Kong, which did not follow the Fed’s tightening moves in December and March, finds itself particularly vulnerable.

    This post was published at Zero Hedge on May 4, 2017.


  • Trump Keeps His Pledge on Tax Reform

    A lot of emails are coming in asking if I have been advising Trump on the taxes since this is similar to the plan I proposed when I testified before Congress. The answer is no. If they took the tax proposals we had worked on with members of Congress back in the Nineties, who knows. They are on file and have been endorsed by many different tax reform advocates.
    I have not spoken with anyone in the White House regarding taxes. I testified why the corporate tax rate must be cut to 15% before the House Ways & Means Committee. The answer is very simple. Corporations will be taxed in their home country unless they pay some tax where they are domiciled overseas. Our headquarters back then was in Hong Kong. Everyone was there because of a 15% corporate tax rate. I testified if the USA lowered the corporate tax rate to 15%, then the USA would become the tax-haven and corporations would move to the States. This is a no brainer and was based on the fact that we did in fact advise multinational corporations – not just theory. I knew what they would do and would have advised them to move accordingly.

    This post was published at Armstrong Economics on Apr 27, 2017.