Macquarie is listing new HSI warrants expiring January 2013 this morning.

Macquarie’s HSI warrants

Looming automatic cuts unnerve investors
After election week in the US, investors turned their attention to the spending cuts and tax increases of more than USD600 billion, which will automatically take place on 1 January 2013 if the Republicans and the Democrats are unable to settle on an alternate plan. This so called ‘fiscal cliff’ threatens to send the US economy into a recession during the first half of 2013, thus investors were fixated on budget negotiations between the US Congress and President Barack Obama.

Boehner gives hope
With concerns that the world’s biggest economy might not be able to avoid the fiscal cliff, the S&P fell 1.4% last week, ending in the red for the second week. The Dow Jones closed 1.8% lower, sliding for the fourth week. This is the gauge's longest losing streak since August 2011. However last Friday, investors found reason to cheer about when House Speaker John Boehner sparked optimism in the markets when he signalled that budget talks with President Obama were “constructive”. Boehner said that he offered a “framework” including new revenue to reduct the US budget deficit while Treasure Secretary Timothy F. Geithner said that he is optimistic that a deal on averting the ‘fiscal cliff’ can be worked out within these few weeks.

IMF unconvinced with Greece
In Europe, Eurozone finance ministers are meeting for the second time this week on Monday, 12 November in an attempt to re-engineer the current bailout plan. In addition, the finance ministers decided to give Greece some breathing space by pushing back its debt reduction target by two years to 2022. This was met with resistance by International Monetary Fund Managing Director Christine Lagarde who took issue with it, raising questions over whether the IMF will continue to keep financing Greece.

Largarde has cut short her visit to Southeast Asia in order to return to Europe for a meeting with the finance ministers on 20 November in Brussels. She said she will find the IMF’s credibility in the talks, signalling a potential clash with euro finance chiefs over the sustainability of Greek debt.

New Chinese President
Last week, China announced a new leadership after ending their week’s long Congress meeting. Xi Jinping will be replacing Hu Jintao as head of the Communist Party while Li Keqiang took over Wen Jiabao as Premier.

Singapore's MTI expects less than 3% growth next year
In Singapore, GDP growth is expected to hit between 1% to 3% in 2013, according to the Ministry of Trade and Industry (MTI). MTI said that the global economy is expected to remain sluggish next year and although Asia’s domestic demand is expected to be resilient, overall growth is likely to be moderate, given the weak external demand. Specific to Singapore, the MTI mentioned that externally-oriented sectors such as the electronics manufacturing are likely to remain subdued. However, growth in domestic clusters such as transport engineering and construction is likely to provide the support for the economy next year.

Key Macro Data this week
Below are the dates for key macro data to be released this week.

Mon 19 Nov: US existing home sales
Tues 20 Nov: Eurozone finance ministers meet
Wed 21 Nov: US consumer confidence sentiments
Thu 22 Nov: Eurozone PMI, consumer confidence sentiments, China PMI
Fri 23 Nov: Singapore CPI