03/01/2017 Asia Business Report

Now on BBC News, all the latest business news live from Singapore.

The bell for 2017. Where should you put your money this year, and will

economists or fortunetellers have the upper hand on predictions? And

remember when the latest technology looked a little like this? We take a

look back at 50 years of the world's biggest Consumer Electronics Show.

Hello, and welcome to Asia Business Report. 2016 was a mixed year for

the global economy, and for the markets as well. The Dow Jones is at

record highs, approaching 20,000, and the US dollar is very strong.

The British pound on the other hand took a beating after the country

voted in a referendum to leave the EU. Now, in this region it was the

Chinese markets that actually ended up underperforming in 2016, while

Thailand's stock exchange was the standout, closing at around 20%

higher despite economic uncertainty there. Now, most markets are

reopening for the new year today. So what should we expect, and where

should we put our money in 2017? Earlier I spoke to Mike McCarthy of

CMC Markets in Sydney and asked whether we will see the US rally

this year. Certainly in the short term that seems likely and ahead of

the inauguration in January it looks like markets are likely take a

positive trajectory. They have been very cautious although we saw some

enthusiasm and buying toward the year end. Last day of trading was a

bit of a visit for most markets and that restrained positioning gives us

confidence that we will hold ground or go ahead in the short term.

Longer term, potential for policy changes in the US are of concern, we

are expecting extreme volatility this year. Do you think that

volatility will extend it to this region as well? Rather unusually we

saw markets like Thailand and Indonesia performing well. Will they

continue to do so? It seems quite likely, in particular Indonesia

where we have seen narrowing account deficits and improvements in

interest-rate environment. It seems the settings are right for further

gains for the sharemarket. There is less participation in the Thai

market, but nonetheless coming from a very modest base after many years

of political uncertainty, and there is once again potential for further

gains. They might not be the regions again this year but there is no

reason to think they will give up their gains -- might not lead the

region again. And another market with strong international

participation is the Chinese market, we saw them going gangbusters in

25th team but that wasn't the case in 2016. It wasn't, and there was a

bit of a diverges from the steadying we saw in the overall economy

against what was a weak performance from the sharemarket but as many

pundits will point out the economy is not the markets and the markets

it are not the economy. Over the long-term we expect the two to move

in rhythm. So we see some catch up on Chinese markets, as investors on

the ground in China recognise that they have been underperforming, and

that there might be a case for higher share prices in China itself.

That is the view of the markets in the year ahead. What of global

economic events? After all the surprises of 2016, Asia business

correspondent has been trying to find out who might have the best

predictions. It is that time of year when many Asians head to the temples

to pray for good luck and figure out what is in store in the year ahead.

Neither financial forecasters nor fortunetellers accurately predicted

what happened in 2016, so if everyone is guessing, who is to say

what is going to happen in 2017? Well, this area is filled with

fortunetellers and numerology, and I am here to meet one of them. Master

Alex. As well as an economist at a private bank, I will be talking to.

The US and China, what kind of relationship will these countries

have in 2017? It will be interesting to say the least, you are talking

about the two largest economies in the world. You are talking about

China, who is ascending in terms of looking to play a larger role in

global politics, and global trade. So how it will play out really all

depends on how Mr Trump is going to deal with some of his contentious

campaign pledges, especially targeting towards China. As you

know, next year is a fire Rooster. From the fire risk you will have a

lot of problems that are going on. That means you will find that this

will give a lot of problems, which means to say that there will still

be hiccups between the US and China. So I think Trump has to put in a lot

of effort to make it work. What about the biggest driver of growth,

though? What are they going to be next year? Looks like maybe next

year the driver will be the recovery in consumer demand, on the back of

recovery and jobs. That could translate into investment recovery,

perhaps with a later lag towards the end of the year. Five years is 1.0,

1.3, 1.5, 1.6, 1.7. So next year is the last year of the five-year

cycle. So on the first half you will see things still on a downside,

before it picks up. What are the big surprise in 2017? The risk will be

one we are mindful of, coming from popular push back against

antiestablishment itself. The Rooster is never a good year, to be

very frank with you. There are a lot of troubles between families,

between companies, even between couples. Well, that doesn't bode

particularly well for any of us. I think it is time for me to get my

fortune taken for the many 17. Take it away, Master Alex. -- 2017. In

other business news, for the first time in more than half a century,

Sweden's is selling car of the year was not a model by the country's

owned Volvo Rand, instead it was the VW golf. The last time this happened

was years ago, when the Beetle was the top-selling car. The Swedish car

manufacturer is owned by a Chinese automaker. China's 63,000,000-dollar

football player Oscar arrived to cheering fans in Shanghai as he

starts playing in the Chinese Super League. Chinese football clubs have

been paying record fees to lure top talent to China. The former

Manchester United player Carlos Teves recently signed with a rival

club in a deal worth $86 million, making Carlos Teves the highest paid

footballer in the world. In the Consumer Electronics Show, getting

under way in Las Vegas later this week, we will be sure to see a whole

number of new mobile devices, gaming consoles and lots of other gadgets

being unveiled. It is an annual fixed for most major tech companies

and it is now in its 50th year, would you believe -- annual fixture.

It is a different show that it was when it all started back in 1967.

Enriching the lives of Orion, education and entertainment at a

very, very reasonable price -- enriching the lives of everyone. It

is phenomenal. It is absolutely show.

It is an event called the National Association of music merchants, the

NAMM show, and we attended the consumer electronics portion, and

the guy who hired me said that is really unacceptable, and he

convinced the board of this non-profit trade association that

they should launch the show, and they did in 1967 in New York, called

the Consumer Electronics Show. It was successful, at its launch it had

70,000 people and 100,000 square feet and it generated a lot of news.

There were only really three main products, TVs, radios and

photographs. -- phonographs. I do believe that the human touch,

the live experience of being with a real person, is something that will

not be replaced in 50 years. And as long as we will take honeymoons with

our loved ones, live, there will be opportunities for business events

like CES where you actually physically are with other people and

get to know them on a personal basis. And you can catch more of our

CES coverage online. A very quick look at the markets now. Amongst

those that have opened here in Asia we can see that the All Ordinaries

over in Australia, that has been doing pretty well. It is pretty much

taking its cues from European markets, which mostly rose on Monday

after stronger GDP data from the likes of Italy. Speaking of GDP

data, I should tell you a little bit about Singapore because it has come

out with its annualised GDP at 3.7% forecast, while GDP on the quarter

rose 91% so that may give the markets here a little bit of

positivity. That is it for this edition of Asia Business Report.

Thank you for watching. The top stories this hour: Turkish

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