Ukraine crisis, China's 1st bond default provide external direction

Published Fri, Mar 7, 2014 · 10:00 PM
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THE main external developments of the week just past were Russia's military occupation of the Crimean peninsula, which elevated tensions with Ukraine and brought the US into the frame, and a large bond default in China, the first of its kind.

Internally, there were also a few notable developments: a continued rise in commodity stocks, possibly thanks to rumours that the Noble Group could enter into a large, lucrative deal involving its agriculture business, unusual volatility in the banks, especially DBS, continued play on water-treatment stocks such as HanKore, Memtech and United Envirotech, and construction firm Lian Beng's purchase of a 5 per cent stake in dormitory builder Centurion Corp.

After an early sell-off, markets stabilised towards the end of the week, suggesting that investors believe that neither the Ukrainian crisis nor the bond default in China will have a lasting impact and that the negative fallout from both would probably be well-contained.

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