DAILY MARKET UPDATES 8th August 2008

Far East to expand hotel chain in Malaysia: report
Hong Kong's Far East Consortium International Ltd is keen to invest further in Malaysia and is in talks with four parties to expand its hotel chain in the country. The group is looking to purchase existing buildings or those partly completed. Far East owns and operates the Dorsett Regency in Kuala Lumpur and the Grand Dorsett Labuan. It also owns the Subang Sheraton and manages the Dorsett Penang. Far East sees potential in Kuching and Kota Kinabalu, and are looking at Kuala Lumpur.

The Business Times, P11



Marina Bay Sands rises out of sight to stay on track
The lay of the land may still look relatively flat over the Marina Bay Sands site but the integrated resort will open on time. That is because almost 40% of the development is underground and progressing well. Of the three hotel towers, one has been built to the eighth storey with the other two already four storeys high. The three hotel towers will have around 2,500 rooms. So far, about 280,000 sq ft of the shopping mall - which is around 800,000 sq ft -has been leased. Average rents for units leased are currently at about $50 psf per month. Marina Bays Sands has employed about 300 people.

- The Business Times, P2 – also see The Straits Times, B2




Property behind 14% rise in F&N Q3 profit
Development property was the key bottom line driver for Fraser & Neave (F&N), which reported a 14% rise in net profit after exceptionals to $110.3 million for its third quarter ended June 30, 2008. Properties benefited from healthy margins from previously launched residential projects, as well as higher rental and occupancy rates, said F&N. Property development contributed 60% of the group's net profit before exceptionals.

- The Business Times, P6




Economic growth may remain weak for some time: Tharman
Finance Minister Tharman Shanmugaratnam cautioned that the country's economic growth is likely to remain weak for some time. He also said that these are challenging times, with growth slowing down around the world, and Singapore should be prepared for weakness in its own economy for several quarters. He expects inflation to ease towards the end of the year. Mr Tharman said the Singapore economy is still fundamentally competitive.

- The Business Times, P10




More financial turmoil to come
The ripple effect of the US subprime crisis to Singapore and other regional economies could soon come clear. Unemployment in the US is rising while tighter lending conditions mean less money in the hands of American consumers, the chief driver of the world economy with their demand for goods. That is already showing up in China and India where their economies look to be slowing. Asia's fate rests largely on how the West comes out of the crisis. Action Economics in Singapore said that Asian economies will slow but, for the moment, they are unlikely to see a sharp contraction.
Writer: Bryan Lee, Economics Correspondent

The Straits Times, B2


Indians seen buying £15b of UK homes over 10-year period
Indians may invest as much as £15 billion (S$40.48 billion) buying UK homes over 10 years as the number of millionaires in the South Asian nation more than triples, Jones Lang LaSalle (JLL) Inc said. Indians may acquire as many as 30,000 homes in the UK. Homes in the UK are becoming increasingly attractive as residential property prices are expected to drop 12% this year and 7% in 2009. Prices may gain 8-9% a year from 2010 to 2013, said JLL. The nation recorded the fastest growth in millionaires last year. The number of Indians with financial assets of more than US$1 million is likely to grow to 400,000 from the current 123,000, with total wealth of US$1.7 trillion. Their investments in the UK may be limited by India's US$200,000-a-year ceiling on capital outflows for resident Indians.

- The Business Times, P13



Jakarta to 'anchor' inflation expectation
Indonesia's central bank said it is taking 'unpopular' monetary-policy actions to achieve its main target of reducing inflation expectations. Consumer prices in Indonesia jumped 11.9% in August from a year earlier, after gaining 11.03% in the previous month. The central bank is forecasting inflation this year of between 11.5% and 12.5%. Indonesia's US$365 billion economy is expected to expand as much as 6.2% this year.

- The Business Times, P11




Sluggish domestic sector, inflation hit S Korean economy
South Korea's economy is weakening as consumer spending growth slows and higher fuel costs stoke inflation, the finance ministry said. The economy grew 4.8% last quarter, the weakest annual pace since the start of 2007 and consumer prices jumped 5.9% last month from a year ago. Retail spending climbed at the slowest pace in six months in June.

- The Business Times, P12



Beijing revises forex rules to better regulate fund flows
China has updated key foreign exchange rules, hoping to boost monitoring of fund flows and stem growth in its massive foreign exchange reserves. The rules allow foreign companies to issue securities in China. According to the revised rules, domestic companies will be allowed to keep their foreign exchange income abroad. The revisions of the rules also impose tougher punishment on people who violate regulations on cross-border transfers and conversion of foreign exchange funds. Illegal conversion could trigger penalties of up to 100% of the funds, according to the revised rules, which take effect immediately. The revisions will assist China in tackling the country's swelling foreign exchange reserves.


- The Business Times, P13

¯ ST Index change 2,834.71 (-52.07)
SIBOR (3 mths): 1.00000 (S$)
SWAP (3 mths): 1.06250 (S$)