Hong Kong’s stock market reached an historic turnover high of HKD 122 billion yesterday. The Hang Seng index was also pushed up to 21,897 during intraday trading, and closed at 21684 yesterday, up 0.5% from the prior day. China’s expansion of the Qualified Domestic Institutional Investors (QDII) scheme, which allows domestic investment fund companies and securities companies to raise capital and invest in overseas markets, is believed to have fuelled the rally for equity.
Hungary’s economy minister says government will not scrap the 15% trading band of the forint vis-à-vis the euro. There had been speculation after the economy minister, Janos Koka, gave an interview in which he claimed that the intervention band might be conflicting with the inflation targeting policy of the National Bank of Hungary. Analysts maintain that the main concern of the monetary authorities is that a removal of the band would lead to an appreciation of the forint, damaging the country’s competitiveness.
Thailand’s Election Commission and Prime Minister Surayud yesterday said that general elections will probably be held in late November, and definitely before 2008. As the largest party, the Democratic Party is likely to lead a coalition government in 2008 and is generally friendly to free-market policies. Analysts also expect that despite weak demand, the Bank of Thailand will not cut the policy rate to below 3% this year from the current rate of 3.5%.
Russia’s net banking profit declined by 36.4% month on month to $996.1 million in April. The advance of investment in securities also slowed to 1.2% in April compared to 13% in March. The same trend was seen in March for loans to corporates and individuals. The interbank lending declined by 11.4% month on month. and client deposits grew by only 2.4% in April compared to 8.4% month on month in March.