The Star Online: Business
The Star Online: Business |
- Ruben’s link with cagers
- China February CPI up 3.2% on year as food prices jump
- Dow record not necessarily a buy signal
| Posted: 08 Mar 2013 10:43 PM PST THREE years ago, Westports Malaysia CEO Ruben Gnanalingam developed an affinity for basketball when he was invited to co-own private hoops club KL Dragons. In an interview at a recent game, the 39-year-old talks about the satisfaction he derives from it. "All sports are interesting but I've grown to see how interesting basketball is. I'd compare it to, say football, which is an exciting game but far fewer goals are scored. In fact, some games flash by without goals by either team. Basketball matches make a riveting watch," he says. The basketball scene in Malaysia is young, but the KL Dragons is making considerable headway at regional games, coming in third or fourth against neighbouring teams from Singapore, Indonesia, Vietnam, Thailand and the Philippines. "It will take time to inch to the top as the other teams are getting better too," Gnanalingam says. In school, his athletic prowess was better seen in strength-based activities such as the discus throw and shot put. In secondary school, he dabbled in softball but after four years of losing to the other teams, he decided to manage the team instead. "There were good players on the team and I think I was crippling their progress by playing," recalls Gnanalingam, whose easy going conversation is timed with self-deprecating humour. That year under his leadership, they won their first game in years. As a consequence, he unexpectedly found his niche in sports. Besides, with sports injuries that would develop in his ankles and knees over the years, team management stands as the best way for him to get involved. Shortly after Gnanalingam took over the KL Dragons with longtime friends Datuk Wira Dani Daim and Datuk Robin Tan in 2010, the partners were invited to the Global Sports Summit in Aspen, US, where they rubbed shoulders with industry giants in America and Europe such as the Chicago Bulls, Dallas Cowboys, the Denver Browns Baseball Club and Arsenal. "I was surprised by the invitation. I didn't think that people, let alone these big players, knew about us," he says. Management strategies There, he learned key management strategies such as seating with regards to pricing, promotion and sponsorship. World leaders such as Arsenal's Stan Kroenke showed Gnanalingam what it took to draw people to their games. He recalls their first year as club owners as the hardest but the initial steep learning curve proved integral to their development. "I learned the hard way as I didn't understand the game so well before. I was under the impression that height was everything," he admits. "Soon, the budding owners hired reliable managers to handle the day-to-day running of the club," says Gnanalingam, who is most involved during the start of the season when new players are picked and direction for the period set. "It doesn't get in the way of me running Westports at all," he says. In the company of Western gamers, the 39-year-old sensed their keeness on the Asian market. "We are still establishing ourselves. Hopefully we can form an alliance with a Western club. For us, we can tap into their espertise and established fan base," he says. "Inversely, they would appreciate the strong viewership here in Asia. We have a wide, wide market for them." In retrospect, Gnanalingam did right when he started attending management courses young. He was barely done with tertiary studies when his father, prominent businessman Tan Sri G. Gnanalingam, pointed his son to a two-week Harvard management course here in KL. Gnanalingam roped a peer in with him and together, they pored over case studies every day with high level executives for whom the course catered to. "We tried our best to appear as young working adults," he recalls, amused "and did our best to apply ourselves. Our inexperience quickly showed, but the corporate guys were very supportive of us. "I don't have a very strong interest in a particular business. I really just want to run them successfully and I'm glad to never have been forced into any of them. The most important take home for me is to always be adaptable to market changes, global key trends and to always be practical." Gnanalingam also co-owns a football club, the Queens Park Rangers, which he manages with Tan Sri Tony Fernandes. |
| China February CPI up 3.2% on year as food prices jump Posted: 08 Mar 2013 08:12 PM PST BEIJING: China's annual inflation jumped to a 10-month high in February as holiday spending for the Lunar New Year drove food prices sharply higher, data from the National Bureau of Statistics (NBS) showed on Saturday. China's consumer price index rose 3.2 percent in February versus a year ago, ahead of market expectations in the benchmark Reuters poll of a rise of 3.0 percent, with food prices leaping 6.0 percent on a year ago - a nine-month high. The month-on-month rise in CPI was also ahead of consensus, with the 1.1 percent increase the strongest monthly gain since January 2012's rise of 1.5 percent. Economists polled by Reuters had expected a 0.8 percent rise. The sharp rise in food prices underlined that seasonal distortions caused by the timing of Lunar New Year festivities - which were in February this year and in January in 2012 - were key drivers of the headline annual rise in prices. "Going into March, with the Lunar New Year impact fading and weather turning better, all conditions become favorable for food production and transportation and March CPI is expected to ease from February," Yu Qiumei, a senior NBS statistician, said in a statement accompanying the data. Policymakers are already braced for higher prices this year versus last. Inflation is likely to hit 3.5 percent in 2013, according to targets announced at the opening of China's annual legislative meeting on Tuesday. Inflation in 2012 was 2.6 percent. The 2013 projection, however, is 50 basis points below the 4 percent inflation that had been factored into the government's 2012 economic forecasts, suggesting that inflation is seen to be relatively well-contained - either by existing policy settings or the relative slackness in the world's second-biggest economy. China's GDP grew at its slowest rate in 13 years in 2012. ECONOMY STABILISING An economic recovery that started in the fourth quarter last year is viewed by analysts as a mild one engineered to ensure stability during the first year of a new government headed by Xi Jinping and Li Keqiang, who are in the final formal stages of taking over from outgoing President Hu Jintao and Premier Wen Jiabao. That is due to be completed by March 17. "This pickup should have enough momentum to buoy growth for at least the first half of 2013, which will allow China's new leaders to take office against a more optimistic backdrop of rising business confidence," Andrew Batson, research director at consultancy GK Dragonomics wrote in a note to clients. Producer price data reflected the still mild nature of the recovery, with prices at China's factory gates falling 1.6 percent in February from the year before, compared with a 1.6 percent drop in January. Month-on-month, factory gate prices rose 0.2 percent in a sign that pricing in China's industrial sector is stabilizing as a recovery in the world's No.2 economy gathers pace. A better sense of broad recovery momentum should come later on Saturday when data for industrial output, fixed asset investment and retail sales is published. Chinese trade data on Friday underlined the uneven path of the recovery, as exports soared past forecasts to jump by a fifth in February from a year ago, while imports were surprisingly weak, falling at their fastest pace in 13 months. - Reuters |
| Dow record not necessarily a buy signal Posted: 08 Mar 2013 08:10 PM PST NEW YORK: The Dow's run to record highs in the stock market's rally this year may not mean it's time for investors to go on a buying spree. Instead, many financial advisers are telling clients to go easy, whether they're just getting back into stocks or seeking to add to equity positions. Questions over how much higher the market can go have kept caution in play, with some technical indicators suggesting the market is overbought. But the case for investing in stocks is strong, they said, particularly given signs of more strength in the economy, especially Friday's jobs report, which showed a much higher-than-expected 236,000 workers added to the payrolls in February. "We're telling clients to take a more defensive approach to the market right now," said Frank Fantozzi, chief executive of Planned Financial Services, an independent wealth manager in Cleveland. Yet stocks remain a better choice than other asset classes, he said. "If I had to pick a category, I'd still be looking at equities," Fantozzi said. "We still think the market is going to post positive gains for the year." On Tuesday, the Dow Jones industrial average <.dji> broke through levels not seen since 2007 and continued to mark new record highs the rest of the week. The Dow is now up 9.9 percent since December 31. The broader Standard & Poor's 500 <.spx> on Friday ended less than 1 percent away from its record close of 1,565.15, which it reached on October 9, 2007. The S&P 500 is up 8.8 percent since the end of 2012. Valuations remain relatively attractive. The S&P 500's forward 12-month price-to-earnings ratio, a commonly used measure to value stocks, is at 13.8 percent, still below its historic average P/E of 14.8 percent, based on data going back to 1968, Thomson Reuters data showed. CAUTION VS APPETITE Other experts gave similar advice, saying investors should proceed, but with caution. "We still have some speed bumps ahead of us," said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. "We don't see any urgency to jump in." U.S. spending cuts loom as Washington debates the path of fiscal policy, while the euro-zone crisis is far from resolved. U.S. economic growth has also been slow. Another reason for caution: U.S. earnings growth - one of the biggest drivers of the market - is slowing. Estimates for first-quarter S&P 500 earnings are now at 1.4 percent, down from a 4.3 percent forecast from January 1, Thomson Reuters data showed. "I try to tell people that although it's a great run, there will probably be some pullback, and we'll see it start to taper off into the summer," said Rodd Newhouse, a Dallas-based financial adviser with Wells Fargo Advisors. Investor interest in the market is high, analysts have noted. TD Ameritrade Investor Movement Index, which is designed to measure investor sentiment based on data on positions and trading activity, rose to 5.14 in February from 4.71 in January, and is high relative to historic ranges. Stock funds attracted $7.14 billion in the week ended March 6, data from EPFR Global showed on Friday, well above the previous week's cash gains of $1.2 billion. Appetite for U.S. stocks largely accounted for the inflows. "Every call that I took this week was (clients asking) 'Why?' They want to know why this market is trading here ... they want to be involved," said Leslie Ferrone, an Oak Brook, Illinois-based financial adviser affiliated with Concert Wealth Management. TIME FOR A BREAK? Some argue it may be time to take a break from buying. Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont, said his computer models show the market is "extended," including regression slopes and other indicators that look at how far the market has come and how fast. "The key here is just don't make a big mistake," Mendelsohn said. He said he's been reducing his exposure to stocks in recent weeks, reversing a more bullish stance. "I'm going to err on the caution side here." Other advice on how to manage the current trend is to shop for bargains while selling stocks with sharp gains. "We're still riding the wave, but taking profits in some of the higher flyers that have done really well and buying some of the areas that are down for the year and hitting new lows," said Alan Lancz, president of Alan B. Lancz & Associates Inc., an investment advisory firm in Toledo, Ohio. "We're still finding some bargains," Lancz said. Fantozzi said he still expects large-cap growth industries to do well, including manufacturing and technology. But he said he would avoid defense companies because of the potential for government spending cuts in that area. "If there's a pullback, we're not looking at a major pullback," Fantozzi said. - Reuters |
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