Thursday, 5 August 2021

Poof! Plus More Supply Chain Problems.

Baltic Dry Index. 3318 +37   Brent Crude 70.57

Spot Gold 1811

Coronavirus Cases 02/04/20 World 1,000,000

Deaths 53,100

Coronavirus Cases 05/08/21 World 201,008,826

Deaths 4,270,245

I do not think it is an exaggeration to say history is largely a history of inflation, usually inflations engineered by governments for the gain of governments.

Friedrich August von Hayek.

Within hours of posting yesterday’s LIR update, yesterday’s top story of piracy and other attacks on shipping in the Gulf of Oman went poof and the story quickly fell apart.  Cui bono?

Iran had decried the reports as suspicious, hinting at a false story orchestrated for some unstated anti-Iran purpose. A Gulf of Tonkin incident perhaps set off prematurely?

By noon UK time, the UK Maritime Agency plus others, were fast rewriting the script.  So that’ll be no new war, for now.

In the central bankster fuelled stock casinos, another wobble in the US casinos and another pause in Asia. Europe’s casinos will likely track US casinos, while keeping a close watch on China’s verbal attack on Chinese gaming stocks. Is official action to follow?

Asia-Pacific stocks mixed; Chinese online gaming stocks come under spotlight again

SINGAPORE — Shares in Asia-Pacific were mixed in Thursday morning trade. Investors monitored Hong Kong-listed shares of firms related to the Chinese video game sector after China’s state media once again took aim at the industry.

In Thursday morning trade, shares of Tencent in Hong Kong slipped 0.18% while Netease dropped more than 3%.

The Securities Times, a publication under the Chinese Communist Party’s official newspaper People’s Daily, published an article on Thursday arguing that gaming firms should not have preferential tax measures that were introduced to encourage the development of the domestic software sector — as the gaming industry is more developed now.

It said that gaming should share the same tax policies as other industries, and warned that the industry should be “mentally prepared for this.”

Shares of Tencent and Netease tanked earlier this week after Chinese state media branded online gaming “opium” in an article that was deleted a few hours after publication and later republished with a new headline and a removal of the reference to the word.

Hong Kong’s broader Hang Seng index edged 0.36% higher.

The Shanghai composite in mainland China rose 0.11% while the Shenzhen component shed 0.219%.

Japan’s Nikkei 225 gained 0.34% while the Topix index advanced 0.26%. South Korea’s Kospi stood little changed.

In Australia, the S&P/ASX 200 rose 0.22%. Australia recorded a trade surplus of around 10.5 billion Australian dollars (about $7.75 billion) in July, according to data released by the country’s Bureau of Statistics on Thursday. That was above forecasts for a 10.45 billion Australian dollar trade surplus, according to a Reuters poll.

MSCI’s broadest index of Asia-Pacific shares outside Japan traded 0.2% higher.

The Covid situation in China may have weighed on investor sentiment regionally. Daily infections have bene rising again in the country as the delta variant spreads across China, with authorities imposing mass testing and widespread travel restrictions in some areas.

Elsewhere, South Korean news agency Yonhap News reported Thursday that the toughest restrictions in the greater Seoul area are “highly likely to be extended again” as cases remain persistently high.

Overnight stateside, the Dow dropped 323.73 points to 34,792.67 while the S&P 500 slipped 0.46% to 4,402.66. The Nasdaq Composite outperformed as it rose 0.13% to 14,780.53.

The moves on Wall Street came after jobs data from payroll processing firm ADP came in well below expectations. The ADP private payroll survey showed a gain of 330,000 jobs for July, well below the consensus estimate of 653,000. The more closely watched Labor Department nonfarm payrolls release is set to be out on Friday.

More

https://www.cnbc.com/2021/08/05/asia-markets-us-economy-australia-trade-currencies-oil.html

In other Asian news, Covid variant Delta is starting to drag on factory production adding to supply chain problems, while weather problems are now also adding to shipping delays. Buy now for Christmas while stocks last.

Southeast Asia's factory powerhouses hit by vaccination woes, Delta

August 4, 2021 5:54 AM  By Orathai Sriring, Liz Lee

BANGKOK/KUALA LUMPUR (Reuters) - Fresh outbreaks of the Delta coronavirus variant in Southeast Asia have crippled its factory sector, disrupting global supplies of goods such as rubber gloves, semiconductors and SUVs and threatening the $3 trillion region’s recovery.

A series of factory surveys this week showed business activity across most Southeast Asian economies fell sharply in July, a contrast to more resilient manufacturing economies in Northeast Asia and the West, where business growth has slowed but remained in expansion.

The economic disruptions in Southeast Asia caused by the virus have been made worse by slow progress in vaccinations in the region of 600 million people. Governments have struggled to secure doses and have imposed costly lockdowns that have left many factories without workers.

The setbacks threaten the growth of one of the world’s more resilient emerging market blocs, which has withstood various global crises in recent decades thanks to broad robust economic reforms and its proximity to China.

HSBC economists warn the low inoculation rates in Indonesia, Vietnam, the Philippines and Thailand, as well as the uncertain efficacy of their vaccines, put their economies at risk.

“This means that populations in these countries could remain vulnerable not only to the current outbreak, but any future mutations that may develop,” HSBC said. “Touch-and-go restrictions are likely to continue, weighing on the near-term growth outlook.”

For Southeast Asia’s manufacturers, which are competitive largely because of low-cost labour and access to raw materials, the impact of new outbreaks on labour supply has been a major production bottleneck.

In Thailand, Asia’s fourth-largest auto exporter and a production base for major global car brands, Toyota Motor Corp suspended production at three of its plants in July in July due to parts shortages caused by the pandemic.

More

https://www.reuters.com/article/health-coronavirus-southeastasia-economy/southeast-asias-factory-powerhouses-hit-by-vaccination-woes-delta-idUSL4N2PA0XZ

China Typhoons Pose Latest Supply-Chain Threat as Ports Shut

By Ann Koh

Updated on 5 August 2021, 04:12 BST

Yantian port stops container drop-offs due to typhoon alert

·         Further disruptions likely as more extreme weather is expected

 

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