China fund’s US$30bil injection

Sovereign wealth fund received new funding in 2011

BEIJING: China's US$410bil sovereign wealth fund China Investment Corp (CIC) received US$30bil in new funding last year, a top executive said, declining to say if the additional money would pay for asset purchases in crisis-hit Europe.

Jesse Wang, an executive vice president at CIC, said the fund considered risk and rewards when buying assets and this modus operandi applied to Europe.

Sources told Reuters in December that CIC could get as much as US$50bil in new money to help it move quickly in overseas purchases.

“Where there are financial assets with low valuations and reasonable returns, all risks considered, we will buy,” Wang said yesterday on the sidelines of a meeting preceding China's annual parliament session starting yesterday.

“Just because Europe has its problems does not mean we will change our method of assessment.”

Cash-rich China with its US$3.2 trillion foreign exchange reserves, the world's largest, has been a port of call for fiscally troubled European nations looking for new investment in their government bonds.

But like other nations, China has not publicly stumped up more money in Europe's anti-crisis bailout fund due to a belief that the euro bloc must put up more of its own cash before it seeks help from others. - Reuters

From EU to China

Stocks Fall for Second Day on China Concerns

Stocks (MXWD) fell for a second day and the yen strengthened after China announced its lowest economic growth target since 2004 and European services and manufacturing output was revised lower. Italian 10-year bonds snapped a six- day rally and commodities declined.
The MSCI All-Country World Index (MXWD) dropped 0.4 percent at 10:50 a.m. in London. Standard & Poor’s 500 Index futures slipped 0.6 percent. The yen strengthened against all 16 of its most-traded peers, while China’s yuan touched a four-week low. The yield on the 10-year Italian bond advanced three basis points to 4.94 percent and the cost of insuring against default on European government debt climbed to the highest in six weeks. Copper slid 1 percent and natural gas fell 2.9 percent.

China cut the nation’s economic growth target to 7.5 percent from an 8 percent goal in place since 2005, according to Premier Wen Jiabao’s speech at the National People’s Congress today. European services and manufacturing output shrank in February more than earlier estimated, Markit Economics said, before a report that may show U.S. factory orders fell for the first time in three months. Greece’s private creditors decide this week whether to sign off on the country’s debt.

“It’s a much more challenging market to be bullish in,” said Andrew Pease, the Sydney-based chief investment strategist for the Asia-Pacific region at Russell Investment Group, which manages about $150 billion. “While the risk of financial Armageddon in Europe is gone, Europe is still going to have a large recession.”

Salzgitter Slides
The Stoxx Europe 600 Index sank 0.7 percent. Salzgitter AG dropped 5.6 percent, the most since November, as the German steelmaker said it’s “impossible” to give detailed earnings forecasts. BP Plc rose 1.7 percent after Europe’s second-biggest oil company reached a $7.8 billion settlement with businesses and individuals over the 2010 Deepwater Horizon oil rig disaster.

The retreat in S&P 500 futures indicated the U.S. gauge will fall for a second day. A report at 10 a.m. New York time may show orders to U.S. factories fell 1.5 percent in January, according to a Bloomberg survey of economists.
The extra yield, or spread, that investors demand to hold Italian 10-year bonds instead of benchmark German bunds increased three basis points, while the Spanish-German spread widened five basis points.
The Markit iTraxx SovX Western Europe Index of credit- default swaps on 15 governments rose four basis points to 349, the highest since Jan. 18.

Yen Strengthens
The yen climbed 0.8 percent against the euro and advanced 0.7 percent versus the dollar. The euro weakened less than 0.1 percent to $1.3196, sliding for the fourth straight day.

The S&P GSCI gauge of 24 commodities dropped 0.5, led by declines in natural gas, lead and zinc. Cotton jumped the daily maximum allowed of 4 cents a pound, or 4.5 percent, after India halted exports. The U.S. is the biggest cotton exporter, followed by India.
The MSCI Emerging Markets Index (MXEF) fell 1.1 percent after closing at a seven-month high last week. The yuan declined 0.1 percent to 6.3067 per dollar and earlier touched 6.3076, the weakest level since Feb. 7, according to the China Foreign Exchange Trade System. The Hang Seng China Enterprises Index (HSCEI) slid 2.3 percent.

The Taiex index retreated 1.4 percent after Taiwanese technology companies reported slumping sales. The BSE India Sensitive Index fell 1.6 percent before the results of state elections tomorrow that may be crucial in determining the future of the ruling Congress Party’s economic agenda. The Micex Index (MICEX) gained 0.7 percent after Vladimir Putin won a presidential election.

chinaman lousy punya la,,, have to work as assembly eworker turun temurun, thats their value onli comunist no die oso no use vermin s#@& head

Is not chinaman lousy. They are actually very hardworking, strong will, willing to learn, and not scared of harsh life in the hope of better life for their family sake.

It is the administration and the politicians is still trying to change but because they used to the communism style for so many donkey years that it may take decades to completely turn to a balance capitalist and care for human rights country. I will not be surprised that our children or grandchildren time China can be like a free capitalist country like US but for the human rights it will take longer time as the majority ppl need to be out of poverty and then the government will pay more attention to human rights issues as other countries will expect China to do so as well as its own citizens.