Market Gazer Hong Kong - Japan - Germany - UK - North America
Market Focus
Friday was G20’s day as the market eagerly
watched how the summit would decide what
to do with the current tensions on
international trade and foreign exchange
policies on its members. The meeting ended
with a joint statement that a more market-
based exchange rate system is needed, and
also the members would avoid competitive
devaluation of currencies. A statement that
rather open to various interpretations and
could both trigger more interventions from
central banks but also could lead to the
otherwise, leading to more speculative trades
to put pressure on the USDJPY, for example.
In addition, outside the communiqué,
Germany criticized U.S. on its attempt to solve
problems by adding more liquidity, and also
refused to take the blame on German’s
surplus current account. U.S.’s Tim Geithner’s
proposal to limit both deficit and surplus by
4% stretch was deemed unrealistic by Japan
and it would hardly make a progress at all.
Market Overview
Nikkei 225 Average, S&P 500 and Nasdaq
ended positive on Friday, while Hang Seng
Index, Shanghai, both FTSE 100 and DAX as
well as Dow Jones Industrials were in the red
as the market gyrated ahead of the G20’s
decisions. Nikkei 225 was up 50.23 points or
0.54% to 9,426.71, while S&P and Nasdaq
ended at 1,183.08 and 2,479.39, respectively.
Hang Seng Index and Shanghai SE lost 0.56%
and 0.28%, respectively, while FTSE 100
finished at 5,741.37 or down 0.29% and DAX
fell 0.08% to 6,605.84. Dow Jones index also
slipped 14.01 points or 0.13% to 11,132.60.
Economic Data
Not much economic data were released on
Friday: China’s unemployment rate dropped
to 4.1% in September from 4.2% in June,
while Hong Kong’s Composite CPI gained 2.6%
22 October2010
in September, slower than the forecast rise of
3.0%, which was the same as August’s rise. In
German, Ifo business climate index rose to
107.6 in October, better than both the
consensus of 106.5 and prior release of 106.8.
Current assessment index also improved from
109.7 to 110.2, also above the consensus of
110. Expectations index edged higher to 105.1
after 103.9 reading in September. The market
had expected the expectations index to have
fallen to 102.9 in September.
Corporate News
 Volkswagen saw a jump in
net income from €655
million last year to €4
billion during the first nine
months this year.
Consensus was at €2.8 billion. Outlook for
4Q was said to be ‘not as good’ as the
recent results. VW closed at €96.76, up
3.2%. YTD operating profit rose from €1.5
billion to €4.8 billion. Sales improved 39%
in China alone to 1.48 million units.
 Hewlett-Packard unveiled Slate 500, a
$799-tablet powered with Windows 7 OS.
The product was said to be a PC with a
tablet form. Another tablet is scheduled
for release next year and it would be
using webOS which had been acquired by
H-P from Palm earlier this year.
 General Electric will buy Clarient, a cancer
diagnostics company for $587 million.
 Daimler AG saw 120,000 units to be sold
in China this year, up from the consensus
of 100k.
 Google’s case on
Google Street View
may be re-opened
by UK officials to decide whether the
service violated data protection laws.
 Wal-Mart is planning to sell digital book
reader from Kobo Inc. starting on
weekend.
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 Market Gazer Hong Kong - Japan - Germany - UK - North America
 Hutchison Whampoa raised $2 billion
after issuing perpetual notes priced at par
with 6% yield. Sale aimed to strengthen
capital base.
 Foxconn planned to invest $2 billion on a
new plant in southwestern Chengdu,
China.
 Sinopec fell 2.4% following the news of a
blast at its Gaoqiao refinery in Shanghai
which injured seven of its workers
yesterday. The shares ended at HK$7.21.
 Vodafone Group Plc. may have to pay
$2.5 billion Rupees regarding its tax
liability on its purchase of Indian
Hutchison Whampoa mobile-unit.
Upgrades & Downgrades
 HK Exchanges & Clearing: P/T @ HK$221
vs. HK$145 (P) (Goldman Sachs)
 Swire Pacific: P/T @ HK$132 vs.
HK$102.40 (P), BUY from HOLD (Citi)
 Hutchison Whampoa: P/T @ HK$90 vs.
HK$65 (P), BUY (Bank of America)
 China Mobile: P/T @ HK$94 vs. HK$93 (P),
BUY (Goldman Sachs)
 New World Development: P/T @
HK$22.20 vs. HK$21.00 (P) (UBS)
 eBay: P/T @ $27, EPS @ $1.64 (2010) &
$1.81 (2011), EQUAL WEIGHT (Barclays
Plc.)
 H-P: P/T @ $65, Strong 10% YoY growth,
BUY (Citigroup)
 Texas Instruments: NEUTRAL from BUY
(Susquehanna)
 American Express: P/T @52,
OVERWEIGHT (Morgan Stanley)
 McDonald’s: P/T @86, Accelerating sales
growth, BUY (UBS AG)
 Amazon.com: BUY from AVERAGE (Caris)
22 October2010
Week Ahead
Economic Data
25/10
 U.S. - Existing home sales 4.3 million
(September) vs. 4.13 (P)
 U.S. – Existing home sales (MoM): +4.1%
(September) vs. +7.6% (P)
26/10
 Germany – GfK Consumer Confidence: 5.1
(November) vs. 4.9 (P)
 U.K. – GDP Annual (QoQ): +0.4% (3Q) vs.
+1.2% (P)
 U.K. – GDP Annual (YoY): +2.4% (3Q) vs.
+1.7% (P)
 U.S. – Case-Shiller (MoM): +2.2% (August)
vs. +3.2% (P)
 U.S. – Consumer confidence index: 49.5
(October) vs. 48.5 (P)
27/10
 Germany – Harmonized CPI (MoM): 0.1%
(October) vs. -0.2% (P)
 Germany – Harmonized CPI (YoY): +1.3%
(October) vs. +1.3% (P)
 U.S. – Durables Orders (MoM): +2.0%
(September) vs. -1.5% (P)
 U.S. – Durables Ex-Transports (MoM):
+0.5% (September) vs. +1.7% (P)
 U.S. – New Home Sales: 300 million
(September) vs. 288 million (P)
 U.S. – New Home Sales (MoM): +4.2%
(September) vs. +0.0% (P)
28/10
 Japan – Retail Trade (MoM): -0.5%
(September) vs. +1.4% (P)
 Japan – Retail Trade (YoY): +3.2%
(September) vs. +4.3% (P)
 Japan – Bank of Japan Rate Decision
 U.K. – Nationwide House Prices (MoM): -
0.3% (October) vs. +0.1% (P)
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 Market Gazer
 U.K. – Nationwide House Prices (YoY):
+2.3% (October) vs. +3.1% (P)
 Germany – Unemployment change: -30K
(October) vs. -40K (P)
 Germany – Unemployment rate: 7.4%
(October) vs. 7.5% (P)
 U.K. – CBI Sales: 35 (October) vs. 49 (P)
 U.S. – Jobless Claims: 455k (Oct 23) vs.
452k (P)
29/10
 U.K. – GfK Consumer Confidence Survey: -
22 (October) vs. -20 (P)
 Japan – Household spending (YoY): +0.8%
(September) vs. +1.7% (P)
 Japan – Jobless rate: 5.1% (September) vs.
5.1% (P)
 Japan – Industrial production (MoM): -
0.6% (September) vs. -0.5% (P)
 U.S. – GDP Annual (QoQ): +2.0% (3Q) vs.
+1.7% (prel.)
 U.S. – Personal consumption (QoQ):
+2.4% (3Q) vs. +2.2% (prel.)
 U.S. – U. Michigan Confidence Index:
+68.0 (October) vs. 67.9 (September)
Earnings Releases
25/10
 China Shenhua Energy Co. Ltd. – 12:00
AM [3Q 2010]
26/10
 Ford Motor Co. –
7:00 AM, 0.37 (F) vs.
0.26 (P) [3Q 2010]
 Nippon Steel Corp. –
11:00 PM [2Q 2011]
27/10
 Bank of China – 12:00 AM [3Q 2010]
 BOC Hong Kong Holdings Ltd. – 12:00 AM
[3Q 2010]
22 October2010
Hong Kong - Japan - Germany - UK - North America
 Canon Inc. – 2:00 AM [3Q 2010]
 Deutsche Bank AG – BMO, 0.93
(F), [3Q 2010]
 Kyocera Corp. – 11:00 PM [2Q
2011]
 Procter & Gamble, Co. – BMO, $1 (F) vs.
$1.06 (P) [1Q 2011]
 TDK Corp. – 11:00 PM [2Q 2011]
 Volkswagen AG – 6:00 AM [3Q 2010]
28/10
 3M Co. – 12:00 PM, $1.51 (F) vs. 1.37 (P)
[3Q 2010]
 Advantest Corp. – 2:00 AM [2Q 2011]
 BASF SE – 1:00 AM [3Q 2010]
 Bayer AG – 1:30 AM [3Q 2010]
 China Life Insurance Co. Ltd. – AMC [3Q
2010]
 China Telecom Corp. – 12:00 AM [3Q
2010]
 Daimler AG – 5:00 AM [3Q 2010]
 Exxon Mobil Corp – 12:00 PM, $1.39 (F)
vs. $0.98 (P) [3Q 2010]
 ICBC – 12:00 AM [3Q 2010]
 Microsoft Corp. – AMC,
$0.55 (F) vs. $0.40 (P)
[1Q 2011]
 Motorola Inc. – 7:00 AM,
$0.11 (F) vs. $0.02 (P) [3Q 2010]
 Nintendo Ltd. – 3:00 AM [2Q 2011]
 Sumitomo Metal Industries Ltd. – 1:00 AM
[2Q 2011]
29/10
 China Construction Bank – 12:00 AM [3Q
2010]
 China Cosco Holdings Co. Ltd. – 12:00 AM
[3Q 2010]
 China Petroleum & Chemical
Co. – 12:00 AM [3Q 2010]
 Merck & Co. Inc. – 12:00 PM, 0.82 (F) vs.
0.90 (P) [3Q 2010]
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 Market Gazer Hong Kong - Japan - Germany - UK - North America

 Mitsubishi Estate Ltd. – 12:00 AM [2Q

2011]
 Tokyo Electron Device Ltd. – 3:00 AM [2Q
2011]

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.

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22 October2010 Page 4