(Bloomberg) — A share-price surge in Japan’s trading houses triggered by Warren Buffett’s $6 billion investment is already fading, due to a lack of fresh catalysts and a downturn in commodity markets.

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Shares of two of the five “sogo shosha” — as the commodity-centric Japanese conglomerates are called — are now trading at or below levels before Buffett’s Berkshire Hathaway Inc. announced its stake purchase. The August announcement, among the largest-ever investments by Buffett in Japan, not only sparked a rally in stocks, but also boosted overall investor interest in the trading companies.

The failure of share prices to sustain the higher levels despite Buffett’s vote of confidence highlights the challenges faced by the shosha as the coronavirus pandemic erodes demand for commodities. It also speaks to the challenges for a Japanese equity market heavily weighted toward so-called value shares, with the benchmark Topix Index on track to lag the MSCI AC World ex-Japan Index for a fifth straight year in 2020.



chart, line chart: Japan's shosha are losing much of their Buffett-led gains


© Bloomberg
Japan’s shosha are losing much of their Buffett-led gains

Berkshire announced on the last day of August that it had bought stakes of about 5% in each of Itochu Corp., Marubeni Corp., Mitsubishi Corp., Mitsui & Co. and Sumitomo Corp. That saw shares of all five firms jumping, with Sumitomo gaining more than 9% on the day.

As of Tuesday, Itochu and Sumitomo have given up all or most of their gains since the announcement. Only Mitsubishi remains substantially higher — with a 7.8% gain since, versus a 2.6% advance in the Topix index in that period.

“The Buffett purchase gave investors a chance to review the shosha stock prices, but since then, they’ve been sold as sentiment wasn’t as strong as hoped for,” said Yoshihiro Okumura, a general manager at Chibagin Asset Management.

Adds latest prices, analyst comments

JOHANNESBURG, Oct 12 (Reuters)South Africa’s rand firmed slightly on Monday, clinging to the previous week’s gains spurred by hopes for the conclusion a stimulus package in the United States.

At 1500 GMT the rand ZAR=D3 was 0.14% firmer at 16.4750 per dollar compared to an close of 16.4975 on Friday in New York.

The expectations of stimulus in the world’s largest economy have provided a welcome boost for the rand by weakening the dollar .DXY and boosting appetite for risk-sensitive currencies.

Traders, however, warned that the cheer was thinning. On Friday, President Donald Trump offered a $1.8 trillion coronavirus relief package in talks with House Speaker Nancy Pelosi – moving closer to Pelosi’s $2.2 trillion proposal.

A holiday in the United States kept volumes thin and traders cautious of any big bets.

Locally, anticipation ahead of Thursday’s address in parliament by President Cyril Ramaphosa, in which he has promised to outline the government’s economic recovery plan, has also kept trading on the cautious side.

Treasury is set to publish its medium term budget (MTBPS) in two weeks time.

“The rand continues to average around R16.50/$ this quarter, in line with our forecasts, and will be subject to volatility, with risks around the MTBPS, Moody’s, S&P and Fitch country reviews and global financial market sentiment,” said Annabel Bishop of Investec.

Bonds firmed, with the yield on the benchmark 2030 paper ZAR2030= down 6 basis points to 9.435%.

In the equities market, the Johannesburg All Shares index .JALSH closed 0.67% firmer at 55,552 points while the Top-40 index .JTOPI climbed 0.74% to 51,158 points.

Leading the gainers was troubled retailer Steinhoff SNHJ.J, which continued to rise after it said on Friday discussions about a $1

This means that many car insurance customers can make tweaks to their policies without fee or risk of suffering any heavy losses.Experts at uSwitch have urged customers that it could be worth going to firms to waive these fees and make changes which could reduce costs.

They specifically highlight how road users can update their mileage details to reduce their perceived road risk and therefore lower charges.

They warn that if your car is due for renewal, it is worth recalculating mileage based on how much you have driven in 2020.

This is expected to be wildly different from the mileage predictions submitted at the start of last year before the lockdown was considered.

This is especially the case for road users who may have been forced to work from home for long periods and give up a long daily commute.

READ MORE: Car insurance customers can ‘cut the costs’ of a policy today

“So if you want to recalculate your mileage, it could be worth giving them a call to waiver the amendment fee.
“If you have a record of your mileage from the last time you applied for cover, you could use this to calculate the difference used this year.

“If you don’t, you can always sum up how far you’ve travelled each day on average to get a rough estimation.”

MoneySavingExpert Martin Lewis has previously urged road users to take advantage of the sudden cut in cancellation and amendment fees to their advantage.

He revealed it was a great time for customers to shop around and switch for a new agreement as drivers would not be liable for costs.

Switching mid-agreement would result in heavy cancellation costs but under current measures, drivers can swap completely free of charge.

He has urged drivers to switch policies regularly to

* Bank lending rises 6.4% in September vs 6.7% in August

* Major banks’ lending slows as big firms pay back loans

* Smaller borrowers continue to rely heavily on lending

(Adds details, quotes from BOJ briefing)

By Chris Gallagher and Leika Kihara

TOKYO, Oct 12 – Japanese bank lending rose at a slower
annual pace in September than the previous month as corporate
funding strains caused by the pandemic eased mainly among big
borrowers, central bank data showed on Monday.

But lending by regional banks remained high as smaller firms
continued to borrow heavily to meet immediate funding needs, the
data showed, underscoring the lingering economic pain brought by
the health crisis.

“Big companies that had borrowed huge amounts of funds as a
precaution around spring are now paying back some of the loans
due to easing uncertainty over the pandemic,” a BOJ official
told a briefing.

“But that’s not to say conditions have improved. There are
gaps among industries on how much their profits have recovered.”

Total bank lending rose 6.4% in September from the same
month a year earlier, slower than a 6.7% gain in August, to a
record 573.7 trillion yen ($5.43 trillion), Bank of Japan data
showed.

The pace of lending by major banks slowed to 7.3% in
September from 8.0% in August.

Lending by regional banks rose 5.3%, roughly unchanged from
the previous month’s 5.4% increase. Those by “shinkin” credit
associations, which lend mostly to small firms in regional areas
of Japan, rose 7.8%, the fastest pace on record, the data
showed.

Bank deposits rose 9.0% in September from a year earlier,
the biggest increase on record, as households held back on
spending and instead saved government pay-outs aimed at
cushioning the blow from the pandemic, the official said.

($1 = 105.6300 yen)

(Reporting

(Bloomberg) — Hong Kong’s boom in initial public offerings is set to be prolonged as companies given a boost by the pandemic outbreak follow China’s technology giants in selling shares, the bourse’s head of listings said.



a person sitting on a bench in front of a body of water: Views of Hong Kong as China Law to Establish 'Red Lines' for the City, Adviser Says


© Bloomberg
Views of Hong Kong as China Law to Establish ‘Red Lines’ for the City, Adviser Says

Companies from the technology and biotechnology sectors could continue to fill the IPO pipeline in the near future as Covid-19 has boosted investments in research and development, Hong Kong Exchanges & Clearing Ltd.’s Head of Listing Bonnie Chan said in an interview on Friday.

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“We thought 2020 would be a disappointment, but it has turned out to be a busy year,” Chan, 50, said. “I believe the IPO rush will continue.”

Hong Kong this year has seen a rush of listings from Chinese companies including JD.com Inc. and Netease Inc., which are selling shares in the city to supplement New York listings amid growing tension between the U.S. and China. It’s now soon set to welcome Jack Ma’s fintech giant Ant Group, which is said to plan a $35 billion dual listing in Hong Kong and Shanghai.

Listings in Hong Kong have jumped 33% this year to HK$220 billion ($28.4 billion). In turn, the exchange’s shares have surged 47% so far in 2020.

The bourse anticipates that listings of companies in the retail and consumer industries will also return once the pandemic subsides, said Chan, who leads a team of more than 260 people to approve listings.

Ant, China’s biggest payments company, is waiting for a hearing with the Hong Kong stock exchange on approval for its listing, which was expected to have happened last week. It now faces added uncertainty stemming from a debate in Washington over restrictions on the payments behemoth.

Ant’s