Repatriated cash revs up Taiwan’s economic engine 14 Aug 2019 President Tsai Ing-wen wants companies that left for mainland China and beyond to return, bringing with them some of the $350 bln already invested overseas. Fallout from a U.S.-China trade war means that is achievable; labour, land and other reforms can make the impact last.
U.S.-China trade war hinges on farmers, not Apple 13 Aug 2019 The Trump administration is delaying import tariffs on some electronics, giving the iPhone maker and the S&P 500 a boost. That’s down to business lobbying and a little pragmatism. But the president wants to boost American agriculture. Until China helps, investors can’t rest easy.
New boss must change HSBC ethos without losing it 13 Aug 2019 Chair Mark Tucker wants a CEO to reverse what he sees as the $149 bln bank’s underperformance. Shifting culture at a lender with 230,000 staff won't be easy. But with Tucker and new Finance Director Ewen Stevenson already outsiders, picking a HSBC alumnus may be the best move.
Moutai investors channel their inner Carl Icahn 13 Aug 2019 Scrappy shareholders challenged the $180 bln Chinese distiller, echoing the U.S. activist’s tilts at titans such as Apple. State-backed Kweichow Moutai will sidestep a vote and cap related-party deals. There’s more work to be done, however, on Beijing-linked corporate governance.
Hong Kong businesses pick an ill-timed ESG fight 13 Aug 2019 A stock exchange plan to increase disclosure on green issues and governance has met resistance from local firms, wary of extra costs. The city already lags the likes of Singapore on such reporting; protests are hardly adding to its appeal. A corporate victory would be pyrrhic.
Aramco stocks Reliance’s war chest for disruption 12 Aug 2019 Mukesh Ambani says the Saudi giant will buy 20% of his oil-to-chemicals unit at a healthy $75 bln valuation. The billionaire is adding cheap broadband to a revolutionary telecoms offering, and aims to reinvent Indian retail too. The Aramco sale hints at how far he'll go to win.
HSBC can use some lobbying flair in China 12 Aug 2019 The bank’s Greater China head has left, days after the abrupt exit of group CEO John Flint. Shake-ups happen. This one, though, comes as the lender faces heat in Beijing over its cooperation in U.S. probes into Huawei. New bosses will need diplomatic nous for a tricky task ahead.
Cathay Pacific yields to its Beijing co-pilot 12 Aug 2019 The Hong Kong carrier will allow Chinese authorities to vet staff flying to and over the mainland, as anti-government protests heat up at home. “Overly radical" employees will be kept away. Local roots and links leave Cathay and parent Swire vulnerable, and with limited options.
Goldman’s top brass become hostages in 1MDB fight 9 Aug 2019 Malaysia has filed criminal charges against current and former star bankers, including international boss Richard Gnodde. It’s a cunning way to ramp up pressure on the Wall Street firm for a mega settlement. Goldman could end up paying three times to end the sovereign scandal.
Fickle nickel sends out false value signal 9 Aug 2019 The metal is at its priciest since 2018 having surged 50% this year, more than other key battery materials. The spike, though, rests on misplaced optimism on Chinese growth, and speculation that an Indonesian ban could curtail supply. Producers like Vale can hold off celebrating.
JD deserves to be in trade-war tech discount bin 9 Aug 2019 Chinese new-age stocks have turned volatile. Loss-making JD, the $40 bln Alibaba-rival, has lost up to one fifth its value since July. The retailer’s focus on sales of big-ticket items make it especially vulnerable to slowing growth and trade tensions. Rivals look more nimble.
J.C. Flowers’ Japan sale marks timely end of era 9 Aug 2019 The U.S. firm, once called a “vulture” by local press, is selling most of its stake in Shinsei Bank after 19 years. With Japanese lenders staggering, cashing out now of what has overall been a lucrative deal makes sense. Foreign funds owe Flowers for giving them a better name.
Viewsroom: Vicious trade cycle traps U.S., China 8 Aug 2019 The White House’s decision to brand Beijing a currency manipulator is the latest move in a conflict riven by miscommunication, unrealistic expectations and no obvious way out. Plus: Why the LSE is paying $27 bln for Refinitiv, and which of the data firm’s owners comes out on top.
Donald Trump can weaken the dollar, at a price 8 Aug 2019 The U.S. President complains about the effect of a strong greenback but what can he do? Intervening in the currency markets may have little effect, but there are alternatives depending on his tolerance for unpleasant consequences. The most helpful move would be to end trade wars.
China’s currency slide could be hard to brake 8 Aug 2019 Tension with Washington has pushed the yuan past 7 per dollar. Beijing needs to keep depreciation modest, but a weakening economy makes that complicated. A sharp fall could weaken already tepid import demand, while cheap exports would sting regional trade partners like Japan.
Hong Kong protesters strike market nerves at last 8 Aug 2019 Blockades and walkouts roiled the city this week. Investors have begun to show signs of anxiety: the benchmark index has given up 2019 gains, though other troubles have hardly helped. Beijing may not mind if protests squeeze business. There will be more disruption to price in.
Masa could do with more Buffett at SoftBank 7 Aug 2019 Quarterly net profit rose 259% on a big stake sale, but operating income fell. More stable cashflows at Masayoshi Son’s group barely cover loan interest. SoftBank is likened to Berkshire Hathaway, which has steadier income from duller companies. That may be worth emulating.
Hong Kong protests cloud Cathay Pacific’s skies 7 Aug 2019 The $5 bln airline delivered decent earnings and expects a better performance in the second part of the year. It won’t look so rosy, though, if anti-China clashes continue and prompt flyers to pick other hubs. Worse, Cathay’s ties to Air China are unlikely to provide shelter.
Kirin’s Japanese makeover is only half pretty 7 Aug 2019 The Japanese brewer is buying 30% of cosmetics and kale juice maker Fancl for $1.2 bln. Diversifying away from booze makes sense; rivals are doing it too. But paying a multiple of almost 40 times earnings, over twice the buyer’s own, for a minority stake is not a good look.
Australia’s largest bank deserves reality discount 7 Aug 2019 CBA reported a disappointing 5% drop in full-year earnings and dashed hopes for a special dividend. That reflects slower growth and higher costs Down Under. Yet the $95 bln lender still trades at roughly twice its book value. A correction is underway, and overdue.