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from Breakingviews:

Alibaba film deal adds to China internet frenzy

By Robyn Mak
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Alibaba’s latest deal shows the extent of investors’ frenzy for China’s internet. The e-commerce giant announced on March 11 it had agreed to buy 60 percent of Hong-Kong listed ChinaVision for $804 million. The film group’s market value promptly soared to almost $5 billion. Star-struck investors are too easily excited.

ChinaVision is issuing new stock to Alibaba at 50 Hong Kong cents per share, a 22 percent discount to its closing price before the announcement, valuing the existing film production and distribution group at around $1.3 billion. Yet ChinaVision shares, which had already risen before the deal, promptly tripled in value.

Investors seem to be excited about having Alibaba as a major shareholder, but details are missing. ChinaVision’s core business is film production and rights distribution, and the company’s mobile video operation accounted for just 1 percent of total revenue in the first half of 2013.

from Global Investing:

No more “emerging markets” please

The crisis currently roiling the developing world has revived a debate in some circles about the very validity of the "emerging markets" concept. Used since the early 1980s as a convenient moniker grouping countries that were thought to be less developed -- financially or infrastructure-wise or due to the size or liquidity of their financial markets -- the widely varying performances of different countries during the turmoil has served to underscore the differences rather than similarities between them.  An analyst who traveled recently between several Latin American countries summed it up by writing that he had passed through three international airports during his trip but had not had a stamp in his passport that said "emerging market".

Like this analyst, many reckon the day has come when fund managers, index providers and investors must stop and consider  if it makes sense to bucket wildly disparate countries together.  After all what does Venezuela, with its anti-market policies and 50 percent annual inflation, have in common with Chile, a free market economy with a high degree of transparency  and investor-friendliness?

from Counterparties:

MORNING BID – Copper, China and currencies

Markets start on the back foot this morning, with weakness overseas - and particularly in emerging markets - feeding through to a bit of strain on U.S. futures and a bit of flight to quality to the U.S. bond market.

The outlook for China once again comes into play, with the most recent fears being more corporate defaults in the world's second-largest economy and the way in which copper imports are used in China as collateral to raise funds. So it's all nicely intertwined here and has had a detrimental effect on both China's stocks, stocks in various exchanges around the world, and of course the price of copper, which was down 5 percent in Shanghai.

from Breakingviews:

Chinese remedy offers little salve for Bill Ackman

By John Foley

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

William Ackman is now tilting at pyramids in China. In the latest phase of the uppity investor’s year-long battle against Herbalife, he argued on Tuesday that the nutritional supplements and diet pill maker violated local laws that ban certain multilevel marketing strategies. The Pershing Square Capital founder raises some good questions. For all the effort, though, it’s hard to see how China will help confirm his ultra-bearish thesis.

from Breakingviews:

Credit chains are China’s weakest link

By John Foley

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

China’s debts are troubling – and not just because they’re alarmingly big. An equally worrying threat to the country’s prosperity is the complexity of those debts. That’s the trouble with China’s lengthening “credit chains”.

from Breakingviews:

China internet duo join forces against common foe

By Peter Thal Larsen and Robyn Mak 

The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

Two of China’s internet companies are joining forces against their common foe: Alibaba. Tencent is injecting its also-ran e-commerce units and $215 million in cash into JD.com for a 15 percent pre-IPO stake in the online retailer. More importantly, the two will collaborate on mobile commerce. Both have the same objective: erode Alibaba’s dominant market share.

from Photographers' Blog:

Making it as a masseuse

Zhengzhou, China
By Jason Lee

I have to admit that I’m a massage addict. I’m hooked on the magical, relaxing effects that massage has, especially after a tiring day of shooting pictures that leaves many of my muscles sore.

My love for the art and my sense of curiosity brought me to the Chinese city of Zhengzhou to photograph the training center of a leading massage company – Huaxia Liangtse.

from Breakingviews:

Search for China’s “Bear Stearns moment” is flawed

By Peter Thal Larsen

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Once again, investors are facing warnings about China’s “Bear Stearns moment”. The country’s possible first domestic bond default has prompted comparisons with the sequence of events that led to the bailout of the Wall Street firm. The parallels between China’s predicament and the crisis of 2008 may be tempting, but are flawed. If the analogy has any use, it’s as a reminder of which mistakes to avoid.

from Breakingviews:

Deadly assault brings new kind of risk to China

By John Foley

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The shocking knife attack that left at least 33 dead in Kunming railway station brings a new kind of risk to China. Investors’ belief in the relative stability of the People’s Republic has allowed it to weather political purges and border disputes without upsetting asset prices or capital flows. But rising ethnic tension could lead to a damaging recalculation at a fragile time.

from Breakingviews:

Macau casino stocks are priced for perfection

By Ethan Bilby

The author is a Reuters Breakingviews columnist.  The opinions expressed are his own.

Macau’s casino stocks are priced for perfection. A building boom will expand capacity in China’s gambling enclave. But to justify their valuations, gaming operators not only need to attract more punters but encourage them to spend more at the tables. Any slowdown or increased competition could test excited multiples.

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