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China's Economy to Cool Further in Third Quarter

This is a transcript of top stories presented by China's CCTV Business Channel as produced by CNBC Asia Pacific.

Hello to our viewers all over China.

You're watching “Asia Market Daily”, co-produced by CCTV Business Channel and CNBC, first in business worldwide.

I am Saijal Patel and here are the top stories across Asia today.

China's economy is expected to cool further this quarter, as fiscal stimulus starts to fade and the re-stocking cycle draws to a close.

The country's domestic product is forecasted to grow at a slower pace of 9.2 percent in the third quarter from 10.3 percent in the quarter before.

That's according to the State Information Centre — a Chinese think tank.

The centre had previously forecast full-year growth of 9.5 percent, which would be close to the average for the past 30 years.

The forecast is in line with private-sector projections.

(SOT) Tai Hui, Regional Head of Economic Research, SE Asia, Standard Chartered Bank:

“Monetary policies going to be held pretty steady. We’re not expecting any more rate hikes to come, there's suggestion that you know, maybe there'll be mild monetary tightening, but we tend to disagree. Of course, on the Renminbi side, we expect the currency to appreciate extremely gradually against the US dollar."

And to keep the economy chugging along in the longer term, there are also other areas of concerns that Beijing needs to work on.

(SOT) Luca Silipo, Chief Economist, Natixis:

“One is the continuing developing of Western and Central China, which is of course a very, very long process. And the other one is how to skew income distribution in a way that doesn't hamper consumption, but China is an objective in consumption over GDP, which is more than 40%, they are 33% now, which is the lowest among all the big countries in the world. To do that, they need to have an income distribution that is more equal, and income distribution right now is going exactly the opposite way, so it's more and more unequal.”

We take a look now at how financial markets have performed in the region today.

Asian stocks had opened flat following in the footsteps of U.S. markets where stocks fell, dragging the Standard and Poors down from a 10-week high.

Some analysts say the pull back on Wall's street is temporary.

But further down the road, the outlook for US markets may worsen.

(SOT) Khiem Do, Head of Asian Multi-Asset, Baring Asset Management:

Perhaps the slowdown in the economy may actually impact on the top line sales growth of companies in the US. So it's possible that the number of positive surprises will be reduced somewhat in the next two quarters of US companies reporting. But this quarter is still very strong, because we have had inventory rebuilding.”

At the end of trading day, Japan led the losers with its benchmark Nikkei 225 closing lower by more than 2 percent.

The yen's strength, reaching an 8th month high against the dollar weighed on blue chip exporters and automaker, Suzuki slumps despite a strong quarterly profit, hurt by its cautious full year guidance.

Meantime, South Korea's KOSPI also finished lower 0.07 percent.

Hyundai Motor lost ground despite posting strong U.S. sales in July.

A bright spot though, is Daewoo Engineering and Construction. Its shares gained on reports its creditor KDB may acquire the builder on its own.

In Australia, the S&P ASX 200 was down by almost 6 tenths of a percent.

AXA Asia Pacific slid after booking a 19 percent fall in first-half net profit.

In Greater China, Airline Cathay Pacific logs a record first-half net profit, sending its shares higher on the Hang Seng.

It was a mixed day of trade for Shanghai and Shenzhen indices but investment managers still keen on the Chinese markets.

(SOT) Kirk West, Executive Director, International Distribution, Principal Global Investors:

"In china, we are seeing policies go to more of a neutral start, so we see that as a positive. And in particular, I think you're going to start to see positive improvements in the construction sector both residential and infrastructure, of course that will be good for the materials stocks. So I think just to move from a more tightening stance to a more neutral stance is very much a positive for Chinese stocks.”

Dollar is at multi-month lows against the euro.

And the weaker dollar is proving a positive for oil and gold.

In energy markets, oil prices rose to new three-month high overnight above $82, but retreated in Asian trade.

The markets will be closely watching the inventory data from the U.S. Government later this evening expecting a drawdown due to storm disruptions.

Meanwhile, investors have been coming back to the gold market to invest in the safe haven asset. Prices of gold held around $1,160 last week, some analysts now looking for a test of $1,200.

Another key driver, China's making it easier to trade in gold is taking steps to liberalize its gold market.

Banks will be allowed to import and export more gold.

Moving on to soft commodities, wheat futures retreated form a 22-month high. The pullback suggests the bull run in wheat may be nearing an endgame.

Others are expecting prices to gain further with Russia cutting it's grain crop forecast because of the worst drought in well over a century. And said export restrictions may be necessary.

(SOT) Mathew Kaleel, Co-Founder & Portfolio Manager, H3 Global Advisors:

“When you get a supply shock like this, it is something that continues for some time, it is very bullish for the price. And unfortunately, it has an impact on inflation, so this could be a very significant event, and what we're seeing on the demand side is China and India consuming more and more wheat, and you have impacts like this on the supply side, it can be quite a significant drought of process going forward.”

And finally, Research in Motion has taken the wraps off its highly anticipated Blackberry Torch, which it hopes will woo consumers away from Apple's iPhone and other rivals.

Is it the iPhone killer everyone said it would be?

CNBC's Brian Shactman checks it out.

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This is the new blackberry torch and it does has a slide, so you get that classic BlackBerry keypad, and fully-integrated touchscreen and all the apps that everybody seems to want. Well this clearly seems to be a savo at Apple's iPhone. Of course, Research in Motion (RIM) wants to keep its enterprise market which is 15 million users worldwide, but as the iPhone is available more businesses, of course RIM wants to protect that, keep its users and expand their consumer space. We’ll see what happens. It’s got a new operating system, reportedly a better web browser, which is key.

I asked the co-CEO of RIM what's the situation about the UAE, and the problems of security in the Middle East, he basically said, you know what, we worked for years to try to make this as secure as possible, and that most likely will not change. in terms of availability, it will be available August 12th in North America, for $200 for 2 years service contract, but no word yet on when it will be available outside of North America and in Asia.

This is Brian Schactman reporting from New York City, Back to you.

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Well, that wraps up today's business highlights.

I'm Saijal Patel from CNBC.

Thanks for watching.

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