Re: Asia Warnings
Very quite weekend in terms of any type of announcements, Asia related or not.
Notice there weren't any numbers posted in the first clip below. So I really don't know how significant this news is.
The second article is not a warning in particular, but talks about 2Q earnings in relationship to Asia economic problems so I thought I would post it. Lot's of subjects are covered in it that we have discussed.
MikeM(From Florida)
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SINGAPORE, June 13 (Reuters) - Siemens Matsushita Components Pte Ltd, so far relatively unaffected by the Asian economic crisis, expects its business to be hit by the recent plunge in the yen, a senior official said on Saturday. ''So far our business has not been affected, but we fear it will be affected because our main competitors are Japanese,'' Klaus Ziegler, president.Ziegler had earlier told reporters at a news conference that the fall in the yen was likely to have a negative effect on demand for the company's products in Asia in the short term.
At the same time, the weaker yen would increase the competitiveness of the company's Japanese rivals, he said..On Friday, the yen fell to 144.74 against the dollar, the weakest level since August 1990.Siemens Matsushita is 50:50 joint venture by Siemens AG and Matsushita Electric Industrial Co Ltd in the field of passive components.
Ziegler said in the interview that the company was revising its growth forecast for the Asian region compared to six months ago. ''Our forecast was at least to grow, in the field of passive components, between 20-25 percent,'' he said.
''But it could easily be that we reduce this prospective growth rate to 10-12 percent,'' he added, although he said the revised growth predictions would only become clearer at the company's upcoming budget announcement.
Asia made up 15-20 percent of Siemens Matsushita's business, he said, but he did not expect this percentage to increase at least in the next two years in light of the economic problems. ''I hope that the share remains stable, but it's definitely not going to grow as much as I thought originally,'' he said. ''I had expected that in 1999 the share to be 20-22 percent, but now due to what is happening here, I'm afraid that the share will not grow or will grow relatively little compared to what we thought it would grow a year ago,'' he added.
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WALL ST WEEK AHEAD- Asia quakes, Wall Street aches
NEW YORK, June 12 (Reuters) - Asian economies are quaking and Wall Street is feeling the aftershocks. Investors will likely remain skittish this week amid fears a recession in Japan will spread to other Asian economies and slash U.S. corporate earnings. Those worries are dimming the short-term outlook for the stock market.
''All eyes will continue to be on Japan and the rest of Asia to see how their currencies are holding up, if they are at all, and if they are taking any action to stem this rout,'' said Guy Truicko, portfolio manager at Unity Management.
The yen slid to its lowest level against the dollar in nearly eight years last week, sending Asian shares reeling. The deterioration prompted stern advice from the U.S. government that Tokyo take bold action to stimulate its economy and address mounting problems in the banking sector.
The market will also nervously await more company profit warnings, particularly from the technology sector which has fallen harder and faster than the rest of the market lately. ''The market will be in a period of consolidation as investors adjust to single-digit earnings growth,'' said Alan Skrainka, chief market strategist at Edward Jones.
First Call, a firm which tracks earnings estimates, last week ratcheted down its second-quarter profit growth forecasts for Standard & Poor's 500 companies to 4.9 percent versus the year-ago period. One week earlier, the forecast had been for 5.3 percent growth.
However, a number of analysts said expectations for the second half of the year remain overly optimistic and will be reevaluated in the coming weeks. ''Expectations for the second half are looking like more of a pipe dream,'' said Truicko, adding that price-to-earnings ratios would have to fall to reflect this.
More bad news, either out of Asia or from second-quarter company pre-announcements, could be the catalyst for a breakdown to 8,400 or 8,500, market watchers said. ''The market will take its cue from Asia. It needs to get direction regarding earnings, not just for this quarter but for second half and that is what is going to drive the market,'' said Arun Kumar, senior U.S. equities strategist at Lehman Brothers.
He said domestic economic data will attract little attention. The May Consumer Price Index, due out on Tuesday, will not be of much concern with inflation worries fading and Asia expected to put a drag on U.S. growth.
However international trade data for April on Thursday will be of more interest than usual because it will reflect one of the more significant direct effects of Asia on the U.S. economy.
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