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Interactive Investor – The retreat of two high-profile activist funds from Japan underscores the difficulties such funds face in squeezing value from their investments and raises worries about lax corporate governance in the world’s second-biggest economy.
The Children’s Investment Fund (TCI) and Steel Partners have been scaling back since last year, joining a growing pool of foreign funds reducing exposure to Japan.
The departure also points to rising frustration among foreign funds that managers are not interested in maximising value, while domestic shareholders, often through complex cross-holdings, want to maintain the status quo.
Alibaba News Channel – Investors generally put aside recent worries about the world economy and banking industry woes on Thursday, sending global stocks higher and reversing safety flows into the Japanese yen.
Mixed earnings plagued European markets, however, with Credit Suisse posting better-than-expected profits and engineering group ABB missing forecasts and giving a cautious outlook.
Euro zone purchasing managers provided the latest "green shoots" data to suggest some economic recovery. They signalled stabilisation in their sectors but also record job losses.
Reuters – World stocks steadied on Friday but were still on track for a sixth consecutive week of gains, while the euro fell on worries about the region’s prospects.
MSCI‘s main world stock index was flat despite modest gains in Europe and a rebound in Japan. But the index was up 1.6 percent on the week, gaining around 28 percent since a March 9 low.
U.S. financial services firmState Street said evidence was building that big investors were buying into the rally, particularly in U.S. and emerging market stocks.
Forbes – The cost of protecting Japanese government debt against default has risen sharply as political uncertainty and worries about the nation’s fiscal position grew after data this week highlighted the depth of recession in the world’s second-biggest economy.
But traders say the market is quite illiquid and dominated by foreign investors such as hedge funds.
Japanese players do not believe the government would default on its debt and seldom buy protection for their holdings of Japanese sovereign bonds.
