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For those with the nerve, Hong Kong has provided superior returns on equity investment over the past years. But China plays, with their increased weighting in the index, are re-writing the equation. By Pauline Loong, Joy Lee and Robert Law.

The jumbo transactions involving PCCW and China Mobile made last year unique for Asian M&A. Deals like that don't come along very often. But even if they don't this year, that should not mean a disappointing 2001 for the region – all the trends point towards continued consolidation. By Chris Wright.

Last year, the Australian stock market stood firm – no longer are the country's leading indices vulnerable to the vicissitudes of global commodity prices. Australia is now a broad-based services economy and the market is host to a diverse range of innovative, well-managed companies with a deserved reputation for their focus on shareholder value. Mark B Johnson reports.

Ian Macfarlane is not given to alarmist statements, and despite concerns about the US economy he continues to forecast healthy growth. The governor of the Reserve Bank of Australia explains policy to Chris Wright.

Thanks to US Federal Reserve chairman Alan Greenspan, the Latin debt capital markets have had a strong year so far, with more than $10.5bn of issuance compared with $9.6bn for the same period in 2000 - despite the clouds gathering over Argentina. Danielle Robinson reports.

Finova Group is the name of the day as the $6 billion bailout proposal by Leucadia National Corp. and Berkshire Hathaway has sparked a flurry of trades and pushed prices up to the mid-80s. Things could get even more interesting as one trader said he is not ready to count out the bid for control by General Electric Capital Corp. and Goldman Sachs. In other distressed trading news, A $10 million piece of Warnaco traded at 43.

BNP Paribas, Credit Suisse First Boston, Morgan Stanley Dean Witter and Schroder Salomon Smith Barney reportedly riled up the euro swaps market last week as they prepared for a USD7-8 billion France Telecom bond issue they are lead managing. Some USD3 billion (notional) traded in the euro swaps market last week as the lead managers positioned themselves for France Telecom potentially wishing to hedge and proprietary traders attempted to front run the positions, according to a trader.

Five-year protection on DaimlerChrysler widened 20 basis points last week to 145 basis points/155bps as traders prepared for today's release of the company's results. John McEvoy, co-founder of creditex in New York, said demand for credit protection on the name spiked last week. He estimated at least twice as much protection in the name traded as in an average week, with demand originating with bank prop traders and bond holders hedging their positions.

European credit derivatives traders were advising their colleagues at German banks to take it on the chin as the financial crisis in Turkey unfolded last week. German banks, including Deutsche Bank, Commerzbank and Dresdner Bank, are believed to have huge basis risk on commercial loans they have extended to Turkish banks, which they have imperfectly hedged by purchasing credit default protection on Turkish sovereigns. "Sit on it and pray," said a trader at a U.S. bank in London. He noted that if the Turkish banks default without an accompanying sovereign credit event, the German banks could be left with substantial losses. Officials at the three banks declined comment.

Paul Croft, chief operating officer of global markets, Japan at Deutsche Bank in Tokyo, has resigned. Croft said he is stepping down to support his wife's business interests in California. He declined to comment on who would be replacing him, but noted that he would remain at the bank for a while to ensure a smooth transition for his successor.