Market Wrap by Decoder – 27 Nov 13

• KR –

o Korea manufacturer’s confidence for Dec fell to 78 from 83 in Nov.
o The government may ask the BOK to lower interest rate as part of the measures to boost the local economy. This is due to the low inflation rate, @ 1.5% Vs the government’s target of 2.5%. A broker blamed the high property prices/unique housing rental system that sucked up all the excess cash, leaving Koreans having little left to spur the economy.

• HK/CN – Foreign banks play waiting game amid opening moves. China will lower the barrier of entry for foreign financial services providers, said Zhou XiaoChun on Tuesday. He mentioned that he will allow more foreigners to enter the financial services market and ensure a level playing field for them. The move is aimed at fostering market competition to improve the quality of domestic players. A trial program will also be implemented in the SH FTZ, he said. Although Zhou wants to step up efforts to open the financial services sector, most foreign banks and insurers don’t really believe that they will be able to enjoy the same benefits as the local players, at least in the short term, said observers. – http://www.ejinsight.com

• Stocks climbed steadily throughout the day only to be sold down in the final mins of trading due to the semi annual rebalancing. T/O was just 5% above 2 weeks average amid the rebalancing ahead of the thanks giving holidays in the US. On the macro side, consumer confidence missed estimates (71.2) and fell to just 70.4 in Nov while the new building permits surged 6.2% MoM in Oct (highest lvl in 5 yrs). In addition, US home prices logged a small gain of 0.7% in Sept, smallest monthly gain since Feb. On the commodities side, oil fell for the 3rd day, ahead of projections that a government report tomorrow might show that US crude inventories rose for a 10th week while gold got sold off slightly after previous day’s gain. Some interesting flows might continue this morning after yesterday’s MSCI rebalancing but other than that, T/O are expected to be subdued today.

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