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South China Morning Post
8 hours ago
- Business
- South China Morning Post
Why critics of the Hong Kong dollar peg are getting it wrong
In financial markets, the Hong Kong dollar is known as a 'widow-maker', a ruinous trade that inflicts painful losses on successive generations of investors. While betting against Japanese government bonds has been the most notorious widow-maker trade, challenges to Hong Kong's currency peg to the US dollar date back to the 1997-98 Asian financial crisis and continue to attract speculators even though the trade has yet to pay off. As recently as May 5, the Hong Kong dollar – which has been pegged to its US counterpart since 1983 and confined to a narrow trading band of HK$7.75-7.85 to US$1 since 2005 – threatened to break through the strong end of the band, as a result of a sharp fall in the US dollar amid concerns about the perceived safe haven status of US assets. This forced the Hong Kong Monetary Authority (HKMA), the city's de facto central bank, to intervene aggressively by selling the local currency, unleashing a torrent of liquidity. Coupled with a surge in inflows into Hong Kong's buoyant stock market , this drove down interbank rates. By the end of May, the one-month Hibor – which serves as a benchmark rate for most residential mortgage loans – had fallen to 0.5 per cent, down from 4 per cent at the end of April. However, the sharp divergence in borrowing costs between Hong Kong and the United States has caused the local currency to weaken dramatically , leaving it perilously close to the weak end of the band. This has fuelled demand for 'carry trades', whereby investors borrow the Hong Kong dollar to buy the US dollar and pocket the interest rate differential. If the HKMA steps in again, this time to defend the weak end of the band, it will drain liquidity from the local market and push up borrowing costs. A renewed surge in Hibor threatens, in the face of a weak economy in desperate need of a sustained period of loose financial conditions. For speculators and critics of the peg, this shows that the disconnect between a US-led monetary policy cycle and a mainland China-driven economic cycle has become untenable.
Yahoo
10 hours ago
- Business
- Yahoo
While individual investors own 28% of Raffles Medical Group Ltd (SGX:BSL), private companies are its largest shareholders with 42% ownership
The considerable ownership by private companies in Raffles Medical Group indicates that they collectively have a greater say in management and business strategy A total of 2 investors have a majority stake in the company with 52% ownership Insiders own 15% of Raffles Medical Group We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. Every investor in Raffles Medical Group Ltd (SGX:BSL) should be aware of the most powerful shareholder groups. With 42% stake, private companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn). Individual investors, on the other hand, account for 28% of the company's stockholders. In the chart below, we zoom in on the different ownership groups of Raffles Medical Group. See our latest analysis for Raffles Medical Group Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. Raffles Medical Group already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Raffles Medical Group, (below). Of course, keep in mind that there are other factors to consider, too. We note that hedge funds don't have a meaningful investment in Raffles Medical Group. Raffles Medical Holdings Pte. Ltd. is currently the largest shareholder, with 39% of shares outstanding. In comparison, the second and third largest shareholders hold about 14% and 7.8% of the stock. Choon Yong Loo, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer. After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions. While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future. While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO. I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions. Our most recent data indicates that insiders own a reasonable proportion of Raffles Medical Group Ltd. Insiders own S$274m worth of shares in the S$1.8b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently. The general public-- including retail investors -- own 28% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run. It seems that Private Companies own 42%, of the Raffles Medical Group stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company. It's always worth thinking about the different groups who own shares in a company. But to understand Raffles Medical Group better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Raffles Medical Group . If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Bloomberg
12 hours ago
- Business
- Bloomberg
Japan's Stocks Still Under Shadow of BOJ Unwinding Bond Holdings
The Bank of Japan is fine-tuning its pullback from the bond market but this mustn't obscure the fact that quantitative tightening is well underway and likely to cause instability in some stocks. The potential impact of quantitative tightening may cast a shadow on the Nikkei 225 Stock Average's chances of climbing further after hitting four-month highs this week. The blue-chip index is skewed toward growth stocks such as Fast Retailing Co., which owns the Uniqlo casual clothing chain, and chip-related firms Advantest Corp. and Tokyo Electron Ltd.
Yahoo
13 hours ago
- Business
- Yahoo
Why Tom Lee says the odds favor a stock-market rally after the Fed decision
Happy Fed Day to all who observe, and at least one widely followed analyst says there's potential for market fireworks despite the 98.8% probability (according to futures markets) the central bank won't move interest rates. That analyst is none other than Tom Lee, the head of research at Fundstrat Global Advisors, whose enthusiasm for stocks generally extends to any day ending with the letter 'Y.' 'I'm at my wit's end': My niece paid off her husband's credit card but fell behind on her taxes. How can I help her? 'I prepaid our mom's rent for a year': My sister is a millionaire and never helps our mother. How do I cut her out of her will? Israel-Iran clash delivers a fresh shock to investors. History suggests this is the move to make. I'm 51, earn $129K and have $165K in my 401(k). Can I afford to retire when my husband, 59, draws Social Security at 62? Why Tom Lee says the odds favor a stock-market rally after the Fed decision Lee, like most everyone, isn't expecting the Fed to cut interest rates later on Wednesday. But he does make a notable case for why the market may react positively. 'We believe the Fed will acknowledge that inflation is undershooting their expectations. Recall the Fed has argued that tariff uncertainty causes them to be on hold. But incoming inflation has been soft,' says Lee. The consumer price index rose a scant 0.1% on a monthly basis in May. Import prices were flat. A real-time measure of import prices, updated through data last week, also has shown little pass through from tariffs to end prices. Market-based measures have fallen to the lowest level in a year, he adds. 'So we think Fed will have to acknowledge this. And we know there is a lot of partisan bias in the inflation consumer surveys,' says Lee. 'So markets likely realize Fed will have to relent eventually and return to a dovish bias.' Lee expects the stock market to return to all-tim highs (the S&P 500 was only 3% away anyway) — he said bitcoin is a leading indicator and the cryptocurrency achievved a record last week. He still has a 6,600 target for the S&P 500 by year end. Stock-market futures ES00 NQ00 were flipping between small gains and losses after an 0.8% retreat for the S&P 500 SPX on Tuesday. Oil CL00 edged higher. Key asset performance Last 5d 1m YTD 1y S&P 500 5982.72 -0.93% 0.71% 1.72% 9.03% Nasdaq Composite 19,521.09 -0.98% 1.98% 1.09% 9.29% 10-year Treasury 4.382 -4.50 -22.30 -19.40 15.50 Gold 3396.8 0.62% 2.42% 28.70% 44.90% Oil 72.63 6.34% 18.41% 1.06% -10.09% Data: MarketWatch. Treasury yields change expressed in basis points Need to Know starts early and is updated until the opening bell, but to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern. At pixel time, the U.S. military still has not joined Israel's fight with Iran, which continued into Wednesday. Iran's supreme leader said the country would not surrender, replying to U.S. President Donald Trump's demand on Tuesday. The Fed decision — and importantly, the dot plot of interest-rate projections — is coming at 2 p.m. Eastern, with Fed Chair Jerome Powell's press conference at 2:30 p.m. Morgan Stanley's economists say they still expecting the dot plot to forecast two rate cuts this year. Weekly jobless claims dipped by 5,000 to 245,000, while housing starts tumbled 9.8% in May to an annual rate of 1.26 million. The Senate passed the stablecoin bill, which creates a regulatory framework for cryptocurrency tokens, and now goes to the House. Goldman ditches ban on SPACs as blank-check firms stage comeback. Jamie Dimon wants workers in the office. So why is he letting JPMorgan's European chief work remotely? The bigger picture from Bulgaria joining the euro Data on the U.S. economy is clearly deteriorating, says Neil Dutta, head of economic research at Renaissance Macro. This chart plots the decline in building material sales, which at a seasonally adjusted annual rate have tumbled 7.7% over the last six months. 'Recall that building material store sales represent an intermediate product that ultimately affects residential investment,' he says. Besides the retail sales report, Dutta also noted the New York Fed's service sector index points on ongoing contraction, industrial production fell for the second time in three months and home builder confidence fell to the lowest level since 2022. Here were the top stock-market tickers on MarketWatch as of 6 a.m. Eastern. Ticker Security name TSLA Tesla NVDA Nvidia GME GameStop PLTR Palantir Technologies AMD Advanced Micro Devices AAPL Apple TSM Taiwan Semiconductor Manufacturing AMZN MLGO MicroAlgo CRCL Circle Internet Group An Italian museum had a crystal-covered chair on display, and the inevitable happened. An 80-year old man tried driving down the famous Spanish Steps in Rome, and it didn't go well. This elderly dog, however, had more success taking on a wild bear. For more market updates plus actionable trade ideas for stocks, options and crypto, . I'm 75 and have a reverse mortgage. Should I pay it off with my $200K savings — and live off Social Security instead? 20 companies in the S&P 500 whose investors have gained the greatest rewards from stock buybacks Israel-Iran conflict poses three challenges for stocks that could slam market by up to 20%, warns RBC 'I'm 68 and my 401(k) has dwindled to $82,000': My husband committed financial infidelity and has $50,000 in credit-card debt. What now? 'It might be another Apple or Microsoft': My wife invested $100K in one stock and it exploded 1,500%. Do we sell?
Yahoo
15 hours ago
- Business
- Yahoo
China's Biggest Soy Sauce Maker Rises in Hong Kong Trading Debut
Foshan Haitian Flavouring & Food Co., China's biggest soy sauce maker, rose 3.3% on its Hong Kong trading debut on Thursday. That's after its HK$10.1 billion ($1.3 billion) stock offering drew strong demand from investors. Bloomberg's Manuel Baigorri reports. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
