GLOBAL MARKETS UPDATE 23/3

Global Markets Update for March 23, 2011:

                                                                                                         

• Newzealand’s current-account deficit as a share of the economy in Q4 last year was near the smallest in a decade at 2.3% of GDP, amid rising milk, meat and lumber exports, and reinsurance payments after a magnitude-7 quake struck the South Island city of Christchurch in September.

• In Japan, Sony Corp shut five more plants and Toyota Motor Corp extended production halts, 11 days after an earthquake and tsunami brought scores of Japanese factories to a standstill. Sony suspended some work in the central and southern regions until March 31 because of trouble getting supplies after power outages.

• US Home Prices in January fell 0.3% , according to the Federal Housing Agency's monthly home price index. Prices nationwide fell 3.9% in the 12 months ended in January.

• Japan is considering setting up a reconstruction agency to oversee earthquake repairs, while data showed the central bank pumped record liquidity into lenders, as the nation grappled with its worst disaster since World War II.

• Dallas Federal Reserve Bank President Richard Fisher says in an interview that he's likely to be among the first Fed officials to press for tighter monetary policy when the time comes, warning that inflationary pressures are building.

• UK CPI inflation rose to 4.4% YoY in February, to record the highest level in more than two years, due to higher gas bills & record fuel prices. Core CPI, which excludes energy, food, alcohol and tobacco, was the highest on record at 3.4%.

• Indian stock markets rose for the first time in four trading sessions yesterday. Markets opened in positive territory tracking firm regional peers. Reports that Japan was making progress in tackling the threat of radiation leak from its Daiichi nuclear power plant further supported market sentiment. Gains were led by realty & auto stocks.

• Overnight, the US markets erased a 3-day winning streak as oil prices continued to rise amid West Asian tensions & concern grew that Europe won’t find an immediate solution to its debt crisis. The indices ended lower after trading in a narrow range for most of the session.

• Today, Asian markets fell for the first time in four days as Japanese companies announced production halts & earthquakes struck near the Fukushima nuclear plant that was crippled after a March 11 temblor & tsunami. Japan’s Nikkei 225 Stock Average fell for the first time in three days, losing 1.6%, having surged 7.2% in the previous two days. Indian equity benchmarks were quiet in opening trade despite spike in crude oil prices, tracking mixed global cues. It seems that markets have discounted rising oil prices due to tensions in Middle East & North Africa.