Daily FNArena News - International

Both UBS and GaveKal are signalling the possibility of the Japanese stock market finding some strength.

Danske Bank suggests the Chinese Government intends to tighten monetary policy further via additional rate hikes, while a currency revaluation cannot be ruled out.

Having underperformed global markets over the past two years the Japanese market offers value but GaveKal cautions against taking an aggressive position as there are few catalysts to drive prices.

China is encouraging its banks to take stakes in foreign institutions, while over in Africa China’s resource interests grow.

It looked like Japan was about to drag itself out of a decade of deflation, but no more. The Aussie gets a green light.

Today’s economic data again surprised to the upside. Expect another Chinese interest rate hike, soon.

Danske Bank suggests market speculation of a revaluation of the Chinese currency is justified as such a move makes sense, even though it is unlikely to occur in the short-term.

ANZ Bank expects last week’s move by the PBOC to lift bank reserve requirements will be followed by an increase in official interest rates.

Asian equity markets have run strongly since the credit crisis in August but GaveKal and Credit Suisse see scope for further gains before any bursting of the bubble.

China’s economic growth is slowing, Credit Suisse maintains, and not accelerating as suggested by others. But it is a good thing as it will make growth sustainable.