Friday 3 August 2012

Chinese and Australian PMI


China, Australia Service Industries Falter
China's service sector lost some momentum and Australian service industries contracted further in July, data released Friday showed, the latest signal of stress in Asia-Pacific economies.


WSJ,
3 August, 2012

The news followed data Wednesday showing a broad deterioration in Asia's export-dependent manufacturing sector, which has faced heavy pressure from a faltering U.S. recovery and a downturn in the euro zone's crisis-hit economy. The soft readings in domestic-oriented services industries add to expectations that policy makers in Asia will take more steps to shore up growth.

China's official non-manufacturing Purchasing Managers Index fell to 55.6 in July from 56.7 in June, as Chinese government measures to rein in property prices took hold. The gauge covers the real estate sector, among others including retail, aviation and software.

The reading came in lower than some private estimates, and two days after China's manufacturing PMI fell to 50.1 from 50.2 in June.

For both manufacturing and services PMIs, a reading above 50 indicates that the sector is expanding while below 50 shows contraction.

"China's economic situation has reached a stalemate. No significant improvements were seen in July," said Citi economist Ding Shuang.

A separate PMI measure of China's services sector compiled by HSBC HBC -0.48% rose to 53.1 from 52.3 in June.

HSBC co-head of Asian economic research Frederic Neumann said the Chinese services PMI data shows China's economy is stabilizing, and is much less worrying than this week's lackluster manufacturing data.

The official 55.6 reading shows the economy is still expanding at a healthy pace, but underlines that Beijing should continue to support it including with measures to spur construction, given the bleak external picture, he said.

"Domestic demand is certainly carrying the load, and will have to for quite some time," said Neumann.

In Australia, the Australian Industry Group-Commonwealth Bank Performance of Services Index fell to 46.5 in July from 48.8 in June. The parts of the country's economy not directly tied to its booming mining sector continue to struggle, as a strong Australian dollar continues to take its toll, Neumann said.


BHP writes down US shale assets by $US2.8b
BHP boss gives up bonus after $3b write-down

ABC,
3 August, 2012

BHP Billiton's chief executive will forgo his annual bonus after announcing shale gas and nickel write-downs totalling $3.15 billion.

The company is taking a $2.71 billion hit on the value of its Fayetteville shale gas fields in the US acquired from Chesapeake Energy only 18 months ago, in February 2011.

Since then, the price of gas in the US has roughly halved, and BHP has shifted its drilling to focus on liquid rich shale fields, with the price of oil remaining much stronger than natural gas.

For article GO HERE




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