Monday, May 2, 2016

US factories chug on, Asia lags behind; Biggest earnings drop for ANZ since 2008; Leicester, 5,000-to-1 long shots, win Premier League

1 US factories chug on, Asia lags behind (Khaleej Times) US manufacturing activity rose for a second straight month in April but at a slightly slower pace, as new orders and production fell. The Institute for Supply Management said its index of national factory activity slipped to 50.8 last month from a reading of 51.8 in March. A reading above 50 indicates expansion in the manufacturing sector. A gauge of orders received by factories fell 2.5 points to 55.8 per cent.

Manufacturing, which accounts for about 12 per cent of the US economy, has been hurt by weak export growth stemming from a strong dollar and soft global demand. Economic growth slowed to a 0.5 per cent annualised rate in the first quarter. Given a fairly robust labor market, which is expected to boost sluggish consumer spending, economists expect gross domestic product growth to rebound in the second quarter.

Asian factories, meanwhile, barely grew in April and those in the eurozone did little better despite heavy discounting, setting a sluggish tone for the global economy in the second quarter. Japanese manufacturing activity shrank last month at the fastest pace in more than three years as major earthquakes disrupted production, while the former bright spot of India sank to a four-month trough and growth in China was all but flat.

The eurozone reading edged up only marginally, painting a more subdued picture of an economy that grew an encouraging 0.6 per cent between January and March. So far, the massive ECB stimulus and weaker euro has yet to feed through to eurozone factories which operated only marginally faster in April.


2 Biggest earnings drop for ANZ since 2008 (Straits Times) Australia's No 4 lender, ANZ Banking Group, has posted its biggest half-yearly decline in cash profit since 2008 and slashed dividends for the first time in seven years on rising corporate defaults triggered by a mining downturn.

The result marks the end of six years of record profits for ANZ and comes a day after No 3 lender Westpac Banking Corp missed earnings forecasts, confirming the negative trend for Australian banks as they battle the commodities downturn and tougher capital requirements.

The big earnings drop at ANZ, the only major Australian bank with a large presence in Asia, also comes in an election year when banking sector misconduct is a hot issue following a series of scandals including insurance fraud and rate rigging.

ANZ, which is shrinking its low-returning Asian business, cut its institutional banking staff by 4,056 in the 12 months to March 31 and reduced loans by A$14 billion, the lender said. While bad debt charges are rising, Australia's major banks have small exposures to mining and mining-related services and their total loan losses are near record lows.


3 Leicester, 5000-to-1 long shots, win Premier League (Barney Ronay in The Guardian) For the past three months Leicester City’s gloriously bold progress towards a first English top-flight title has unfurled like a slow breaking wave. A draw against Manchester United on Sunday afternoon left Claudio Ranieri’s collection of offcuts and rising talents a step closer.

Tottenham’s failure to beat Chelsea on Monday night was the final nudge. The wave has finally broken on a Premier League title some are already calling the most unlikely sporting victory of all time.

The fairytale-ish aspects of this are well rehearsed. At the start of the season Leicester were 5,000-1 with bookmakers to win the league, a wager taken up by only 12 William Hill punters, among them the 39-year-old Leicester carpenter Leigh Herbert whose fiver, offered up in faith not hope, has now raked in £25,000. Three months into the season, with Leicester already haring away at the top of the table, they were still 1,000-1 to win it. Still a freak, a blip, a hilarious blue-shirted glitch.

And yet the most striking aspect of the season’s endgame has been the beautifully controlled way Leicester have closed things out. It is only in the last few weeks that the realisation has dawned Leicester haven’t just been edging this – they’ve been running away with it, already out there on the victory lap of honour, ambling round the bases, high-fiving the bench, ball safely dispatched above the bleachers.

This is a club whose previous highest league position was a runners-up spot in 1929, who have been relegated or promoted 22 times in all. Too small to stay up, too big to stay down. In 2002 they nearly went out of business altogether but were rescued by a consortium led in part by their ex-player Gary Lineker. Two seasons ago they were fighting their way up out of the second tier. In February last year they were bottom of the Premier League and on their way down before a stunning late rally under Nigel Pearson, who was abruptly sacked.

And now from nowhere we have this, a season that has quite literally morphed into a Hollywood script. There have been surprising champions before. In the past 55 years Nottingham Forest and Ipswich Town have won the title the season after being promoted. That was then, though.

In the violently stratified air of modern-day Big Football, a triumph like this seemed not just remote but impossible. The website Sporting Intelligence has calculated Manchester United have spent more on new players in the two-year reign of their current manager than the new champions have in their entire 132-year existence. There is no back route to the summit. The world has shifted. Some things simply can’t happen anymore. This has.

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