1) Wednesday’s unexpected decision by Dubai World, the Gulf emirate’s largest state-owned conglomerate, to impose a six-month debt standstill has foreign creditors up in arms. Earlier this month, Dubai’s ruler Sheikh Mohammed Bin Rashid Al Maktoum publicly pledged his support for the group and its obligations.
The consequences of the standstill, and possible eventual default, are far-ranging. The repayment of Dubai World’s $4bn Nakheel bond was seen as a litmus test for the emirate’s ability to deal with the $80bn owed by the sovereign and its state-controlled companies. The emirate’s willingness to do this is now in doubt, especially as only an hour earlier it raised $5bn from two state-controlled banks in Abu Dhabi. This was only half what had been expected, but followed $10bn of earlier support from the kingdom’s richer neighbor.
For more, go here.
2) Vietnam announced a 5 percent devaluation of its tightly controlled currency Wednesday, succumbing to pressure for a weaker dong as foreign reserves dwindle.
It was the third devaluation of the dong in less than two years and suggests Vietnam's large trade deficit is making it difficult for officials to keep the currency stable.
For more, go here.
A few Malaysian construction companies have construction projects in Dubai and property development & construction projects in Vietnam. The above development may impact their bottom-line. We have seen some of these stocks being sold off yesterday & today. Gamuda broke below its uptrend line at RM3.00 yesterday (see Chart 1) & IJM broke its uptrend line support at RM4.50 today.
Chart 1: Gamuda's daily chart as at Nov 26, 2009_4.45pm (Source: Quickcharts)
Chart 2: IJM's daily chart as at Nov 25, 2009 (Source: Tradesignum)
No comments:
Post a Comment