Year opens on positive note, but ECM activity seen as thin

There was a strong tone in Asian stock markets yesterday when Hong Kong and Singapore kicked off trading in 2012 thanks to a positive purchasing managers index in China that caused some enthusiasm among investors. But the 2.4% gain in the Hang Seng Index and the 1.6% rise in the FTSE Straits Times benchmark were logged amid thin volumes and hence didn’t display a huge amount of conviction.

That said, bankers hope that a few more days of gains could trigger some modest block trade activity or follow-on share sales to break up what is otherwise expected to be a very quiet month in the equity capital markets. From a...