MOST NOTEWORTHY:

• Thomas Weisel started Chico's FAS (NYSE: CHS) with a Market Weight rating and $26 target citing near-term mix pressure, lower margin potential and lower square footage growth.

• Thomas Weisel also initiated shares of Cache, Inc (NASDAQ: CACH) with an Overweight rating and $21 target, citing a significant sales opportunity driven by new categories and demographics.

• AG Edwards believes the risk/reward for JP Morgan & Chase Co (NYSE: JPM) is balanced, assuming coverage with a Hold rating.

• Lehman resumed coverage of National City Corp (NYSE: NCC) with an Overweight rating and $41 target...

• Montgomery & Co initiated SiRF Technology Holdings Inc (NASDAQ: SIRF) with a Buy rating and $32 target.

• Merriman initiated shares of Aware, Inc (NASDAQ: AWRE) with a Buy rating.

• Xinhua Finance Media Ltd (NASDAQ: XFML) was started with a Buy rating at W.R. Hambrecht.

• Matrix USA initiated shares of Florida East Coast Industries Inc (NYSE: FLA) with a Strong Sell rating.

Analyst initiations 5-01-07: CACH, CHS, JPM and SIRF originally appeared on BloggingStocks on Tue, 01 May 2007 11:19:00 EST. Please see our terms for use of feeds.

By the end of 2006, the Chinese financial market is supposed to be opened to foreign banks. Don't you believe it. Despite spending $23 billion dollars for stakes in Chinese banks, foreign companies own 2% of Chinese banking assets. Brian Bremner and Dexter Roberts have examined the regulations applying to foreign ownership and control in the Chinese financial sector. Their article, "How Beijing is Keeping Banks at Bay," (Business Week 2 October 2006), asserts that the Chinese government is willing to allow foreign entry into its financial sector only to the degree necessary to assure minimal compliance with its WTO agreement. Foreign entites can open only 1 branch per year, with a $50 million minimum in operating capital. Foreign entities are limited to a maximum of 25% ownership in a Chinese bank. This insures that foreign entities have no effective control over any Chinese banking strategy and/or operations. The banking sector is not independent enough from the Chinese government.

Against this protectionist backdrop, Industrial & Commercial Bank of China (ICBC) is beginning to sell what might turn out to be the world's largest IPO. ICBC officials and underwriters are in Hong Kong this week negotiating the placement of $3.5 billion worth of demand. The initial round of IPO shres is expected to raise $19 bliion according to Kate Linebaugh. "Chinese IPO Gets Star Investors." The largest investment entity will be China Life group, buying $847 million. Kuwait Investment Authority has subscribed for $719 million.

In a disturbing and related piece of information, the Chinese government recently passed a law prohibiting foreign financial information companies from selling data directly to Chinese banks. Only Xinhua, a Chinese publishing company, can distribute financial information in China. The government tries to reduce foreign involvement in the financial sector, bars access to independent thiid-party information, and investors still line up to buy this stock? Just how desparate are people to make a buck in China? Are they desparate enough to leave thier common sense out of the equation?

Chinese banking sector originally appeared on BloggingStocks on Tue, 26 Sep 2006 13:09:00 EST. Please see our terms for use of feeds.