News and Research Update

November 24, 2009, 12:00 AM - Data Source: UBS Wealth Management Research

Research in focus:

UBS research focus: infrastructure investments – trends to build on

In the wake of the financial crisis, infrastructure spending worldwide is set to boom. In the new UBS research focus report, "Infrastructure: a strong foundation," Wealth Management Research (WMR) highlights the variety of attractive infrastructure-related investment opportunities that stand to benefit from this spending surge.

Daily Market News:

Economic News

USA: Existing home sales uptrend still intact (November 23, 2009, 9:01 PM)
Existing home sales rose by more than expected 10.1% m/m to 6.1mn annualized units in Oct. The improvement was recorded for both single and multi-family units. Months of supply fell from 8 to 7, which is in line with the long-term average. Other housing statistics have shown less strength recently.

Taiwan: Export orders return to positive growth (November 23, 2009, 3:52 PM)
Orders reached a 12-month high and grew 4.4% y/y in October as demand from China and ASEAN countries increased 19.6% y/y and 16.3% y/y, respectively. Order amount was only 1.4% shy of the pre-crisis level as demand improved. We expect this recovery in order growth to extend into the coming months.

Taiwan: Industrial production growth continues (November 23, 2009, 3:51 PM)
Industrial production reached a 14-month high as manufacturing activity increased due to improving exports. Industrial production grew 6.6% y/y and 0.5% m/m in October as demand for the island's chemical and IT products increased. We expect industrial production to show continuous improvement.

Thailand: Faster-than-expected recovery in 3Q (November 23, 2009, 3:50 PM)
Thailand's economy contracted 2.8% y/y in 3Q after a 4.9% decline in 2Q, although better-than-expected. This is mainly due to improvement in private consumption, manufacturing output and exports. We expect domestic demand and manufacturing output to continue to support growth in the coming quarters.

Malaysia: Another strong quarter of GDP growth (November 23, 2009, 8:20 AM)
Malaysia's economy contracted 1.2% y/y in 3Q after a 3.9% decline in 2Q, this translates into 9.4% growth over the quarter. Growth was better than expected due to robust government spending (+10.9% y/y) and strong consumer spending (+6.3%). We expect growth to continue its momentum further into 4Q.

Singapore: CPI continues to drop (November 23, 2009, 8:19 AM)
Roughly in-line with our expectations, consumer prices fell 0.8% y/y in October after a drop of 0.4% in September. After seasonal adjustments the price level rose 0.3% over the month. We expect CPI inflation to turn positive in December and to accelerate quickly to above 2% in April 2010.

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Equity Markets EU

Daily European Equity Market Comment (November 23, 2009, 3:42 PM)
On Monday, European stocks advanced on speculation that economic recovery is strengthening, supported by data that showed region's services and manufacturing industries expanded in November. The DJ STOXX 600 index was up led by Basic Resources, as mining stocks BHP Billiton and Rio Tinto gained on higher metal prices. The index has surged 60% since its lows in March this year as governments' across the globe initiated stimulus programs to revive growth.

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Equity Markets Asia

Daily Asia-Pacific Market Comment (November 23, 2009, 11:26 AM)
On Monday, most Asian markets began the week on a positive note. Hong Kong and Singapore markets were among the best performers. We recently launched an Investment Theme on Singapore tourism as we expect a strong rebound in the sector, driven by an expected recovery in Asia's consumption power. We believe the expected completion of two new integrated resorts, which will house Singapore's first casinos and a Universal Studios theme park, and the makeover of three other tourist districts would further enhance the city-state's attractiveness, in our view. Please refer to our paper for more information and recommendations.

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Forex Markets

USD: Bullard's comments weaken the dollar (November 23, 2009, 4:37 PM)
The US dollar weakened against the majors after St.Louis Fed President Bullard said he was in favour of extending the Fed's MBS program that expires in March. Another factor in this weakening was an increase in risk appetite. We expect the weakening trend of USD to continue further.

CHF: Further rise of SNB's FX reserves (November 23, 2009, 3:51 PM)
According to the latest SNB Monthly Statistical Bulletin the SNB's FX reserves rose from 82 to 90 bln CHF in November. Since the start of the intervention, in March 09, the reserves have increased by 94%! We expect the SNB to continue to prevent a sharp rise of the CHF against the EUR.

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