Asian markets rise on Greece deal

HONG KONG: Asian markets rose in early trade Tuesday after the eurozone and the IMF agreed to unlock 43.7 billion euros ($56 billion) in loans to Greece and grant significant debt relief for decades to come.

Tokyo shares rose 0.38 per cent by the break, Hong Kong was up 0.25 per cent and Sydney gained 0.68 per cent.

Seoul opened flat but Shanghai was down 0.76 per cent on concerns over the strength of recovery in the domestic economy.

The Eurogroup of currency partners penned the Greek deal at its third late-night meeting in two weeks, agreeing to release, in December, the funds after months in which Greece was starved of bailout financing.

Greece, struggling to stay afloat despite a series of unpopular austerity measures, has been waiting impatiently for an injection of international loans for several weeks to avoid defaulting on its upcoming debt repayments.

Greece's public creditors agreed to take measures to bring down the country's debt-to-GDP ratio from an estimated 144 per cent to 124 per cent within eight years, in exchange for the bailout funds.

Finance ministers, the IMF and the European Central Bank said the money would be paid in four instalments from December 13 through until the end of March.

Greek Prime Minister Antonis Samaras said the agreement represented a fresh start for his beleaguered country.

"Everything has gone well," Samaras told local media in Athens. "All Greeks have fought (for this decision) and tomorrow is a new day for every Greek person."

ECB President Mario Draghi said: "The decision will certainly reduce the uncertainty and strengthen confidence in Europe and in Greece."

US markets were feeble in the first session after a slow Thanksgiving holiday week, with the jury still out over how strong the crucial Black Friday holiday sales were for retailers.

The Dow Jones Industrial Average finished down 42.31 points (0.33 per cent) at 12,967.37.

The broad-market S&P 500 lost 2.86 (0.20 per cent) at 1,406.29, while the Nasdaq Composite rose 9.93 (0.33 per cent) to 2,976.78.

On currency markets the euro was stronger in Asian trade as investors breathed a sigh of relief over the deal for Greece.

The 17-nation currency bought $1.2980 and 106.46 yen in Tokyo morning trade after briefly topping $1.30 for the first time in about a month.

That was up from $1.2971 and 106.38 yen in New York trade late Monday, although the euro eased slightly after the Greece announcement.

The dollar was flat at 82 yen.

On oil markets, New York's main contract, West Texas Intermediate (WTI) for January delivery, bounced 30 cents to $88.04 a barrel and Brent North Sea crude, also for January, jumped 29 cents to $111.21.

Gold was at $1,749.50 at 0310 GMT compared with $1,734.47 late Monday.

S'pore's 2013 pay rises to be mostly flat after inflation: Study

ANY pay increases reaped by local professionals next year could largely be eroded by inflation - an outcome that would put Singapore bottom in the region for real wage rises.

Local companies plan to give their employees a 4.5 per cent salary rise next year, according to a study by global human resources consultancy ECA International, but the International Monetary Fund (IMF) expects inflation here to be 4.3 per cent.

This means real incomes - a measurement of purchasing power taken by adjusting wages for inflation - will rise a paltry 0.2 per cent.

"This continues the pattern already seen this year whereby employees in Singapore have, on average, experienced no increase in real terms," said ECA in a statement.

This year, companies gave staff an average pay rise of 4.5 per cent. With the IMF's inflation figure, also of 4.5 per cent, it means workers are no better off.

The fact that wage rises will be similar for two years reflects continued uncertainty among companies about their financial performance, said Mr Lee Quane, regional director for Asia at ECA.

He added that Singapore's real wage situation "contrasts dramatically" with other developed economies in the region.

Salary increases in Australia were 4 per cent this year - less than here - but lower inflation means staff Down Under enjoyed a 2 per cent rise in real income.

Salary rises for the Asia-Pacific region next year are forecast to be 6.2 per cent. With inflation expected to run at 3.5 per cent, real wages for the region are expected to rise 2.7 per cent.

In terms of expected real wage rises next year, Singapore places bottom on a list of 14 regional economies that include Australia, Japan, Hong Kong and Malaysia.

Hong Kong's wage rise is expected to be 4.5 per cent next year. With inflation at 3 per cent, real wages will rise 1.5 per cent.

The study of white-collar wages surveyed 322 companies around the world, including 140 here, from sectors such as logistics, manufacturing, banking and retail.

Mr Quane said from 2007 to this year, Singapore wages rose by 20 per cent, but real income was up only 0.4 per cent in the period.

United Overseas Bank economist Francis Tan told The Straits Times: "Inflation is going to remain stubborn for next year, and real wages will remain flat."