Pimco’s Total Return Bond Fund Suffers $7.5 Billion Outflow in July

"According to an article published today in the Wall Street Journal Pimco's Total Return Fund suffered a $7.5 billion net outflow last month, according to data from fund tracker Morningstar Inc.

It is the third straight monthly outflow for the fund, on the heels of nearly $10 billion in redemptions in June. Clients have made redemptions of $15.6 billion from Gross’s fund in 2013 through July.

Gross’s fund produced some gains in July after a quarterly loss during the second quarter. But the July outflow signaled continued investor anxiety over rising bond yields and falling prices.

The fund is still a laggard this year, hurt by a record quarterly loss of 3.6% between April and June. The fund was down 3.08% in 2013 through Thursday, compared to a loss of 2.84% on the benchmark index, according to Morningstar.

Fears that the Federal Reserve will soon cut back bond purchases have sent funds out of fixed-income assets over the past few months. The benchmark 10-year Treasury yield has risen about 1% since the start of May"

The benchmark 10-year Treasury yield has risen about 1 percentage point since the start of May.

Toyota profit soars in Q2

"Toyota said Friday net profit soared 93.6% to a record 562.19 billion yen for the three months to June, and said it was on track to produce over 10 million vehicles worldwide this year.

The world’s biggest automaker has ramped up its bid to tap emerging markets while key U.S. demand has also been on the upswing, helping Toyota to book ever-increasing profits over the last year.

The Camry and Corolla maker tripled its net profit in the past fiscal year with a slump in the yen helping Japanese manufacturers’ bottom line.

On Friday, Toyota said it also saw its European market decline in the quarter as Asian sales slipped.

But North America helped make up the shortfall along with strong demand in emerging markets in Central and South America as well as Africa, it added.

Toyota said it earned 562.19 billion yen in the quarter on sales of 6.25 trillion yen, which were up 13.7% from a year earlier.

Profit “increased due to the impact of foreign exchange rates and our global efforts for profit improvement, through cost reduction activities,” Managing Officer Takuo Sasaki said in a statement.

Looking forward, Toyota said it expected to pump out a record 10.12 million vehicles this calendar year, after it overtook General Motors in 2012 to regain the title of world’s biggest automaker"

Source: JapanToday

Nikkei 225 index clsed 2.82% higher

Tokyo stocks surged 3.29% Friday on the back of a firmer dollar, upbeat earnings results and a strong lead from Wall Street.

The benchmark Nikkei 225 index closed up 460.39 points at 14,466.16, while the Topix index of all first-section shares gained 2.82%, or 32.78 points, to 1,196.17.

The dollar bought to 99.60 yen in Asian afternoon trade, compared with 99.52 yen late in New York and 98.63 yen in Tokyo earlier Thursday.

The euro bought $1.3209 and 131.56 yen against $1.3208 and 131.45 yen in US trade.

The Nikkei will likely continue to advance as uncertainties surrounding global economies have waned and expectations for better earnings for Japanese exporters mount on the back of a stronger dollar.

Big-hitters SoftBank and Sharp also helped drive the index higher after impressing with their first-quarter earnings released earlier this week.

SoftBank’s net profit more than doubled for the three months to June, while Sharp managed to reduce its loss in the same period thanks to the weaker yen and cost-cutting.

China relax controls on life insurance interest rates

 China's insurance industry regulator said Friday that it will relax controls on interest rates for standard life insurance products, marking the country's latest effort to deepen market-oriented reforms in its financial system.

The 2.5-percent upper limit on pre-determined interest rates of standard life insurance products will be removed starting Aug. 5, according to a notice posted by China Insurance Regulatory Commission (CIR) on its website.

The measure represents China's freshest effort in interest rate liberalization, following the central bank's key move on July 19 to loosen its grip on bank lending rates.

Under Friday's new regulation, insurance companies can set their own rates in line with prudent principles, but for risk prevention purposes, a new cap of no more than 3.5 percent will be applied for the statutory reserve requirement assessment ratio of standard life insurance products.

Official CIRC data show that the assets of China's insurance industry totaled 7.88 trillion yuan (1.27 trillion U.S. dollars) at the end of June, up 7.2 percent from the level at the beginning of 2013

he rigid 2.5-percent cap, made valid since 1999, has resulted in severe homogeneity in life insurance products, according to Tuo Guozhu, professor of insurance at Capital University of Economics and Business.

The proportion of standard life insurance products in China's total life insurance business declined from 44 percent in 2002 to 9.2 percent in 2012, "a result of consumers' voting with their feet," said Tuo.

Source: Xinhua

A closer look to US unemployment data of July

Total nonfarm payroll employment increased by162,000 in July,and the unemploymen rate edged down to 7.4 percent the U.S. Bureau of Labor Statistics repor         Employment rose in

retail trade, food services and drinking places, financial activities,           and wholesale trade.

Household Survey Data

Both the number of unemployed persons, at 11.5 million, and the unemployment     rate at 7.4 percent,


edged down in July. Over the year, these measures were down by 1.2 million and   0.8 percentage
point, respectively.

In July, the number of long-term unemployed (those jobless for 27 weeks or more) was little
changed at 4.2 million. These individuals accounted for 37.0 percent of the      unemployed. The number of long-term unemployed has declined by 921,000 over the past year.
. 
The number of persons employed part time for economic reasons (sometimes referred to as involuntary
part-time workers) was essentially unchanged at 8.2 million in July. These individuals were working
part time because their hours had been cut back or because they were unable to   find a full-time job.
 
In July, 2.4 million persons were marginally attached to the labor force, little changed from a
year earlier. (The data are not seasonally adjusted.) These individuals were not in the labor
force, wanted and were available for work, and had looked for a job sometime in  the prior 12
months. They were not counted as unemployed because they had not searched for    work   in the 4 weeks
preceding the survey.

Among the marginally attached, there were 988,000 discouraged workers in July, up by 136,000 from
a year earlier. (The data are not seasonally adjusted.) Discouraged workers are  persons not
currently looking for work because they believe no jobs are available for them.  The remaining
1.4 million persons marginally attached to the labor force in July had not searched for work for
reasons such as school attendance or family responsibilities.