Offshore squeeze sets back China’s yuan goals 13 Jan 2016 The central bank has sucked renminbi out of Hong Kong, sending overnight interest rates soaring. The show of force helps stabilise the short-term exchange rate. But it delays the gradual shift to a less controlled currency, and will force officials to tighten capital controls.
Wanda builds an empire Hollywood can only dream of 13 Jan 2016 China’s richest man is buying a U.S. studio for $3.5 bln. His Dalian Wanda group and rivals like Alibaba Pictures are investing in all sorts of film businesses. Such vertical integration - banned in the United States - shows the allure of one of China’s fastest-growing sectors.
China’s troubles catch Japan off-guard 12 Jan 2016 Japan is highly sensitive to its larger neighbour’s economic health. Market turmoil is also strengthening the yen, threatening profit and prices. This could hardly come at a worse time: policymakers already battling deflation and stagnation have few levers left to pull.
Smartphones battle web giants for China payments 12 Jan 2016 Apple and Samsung are joining the fight for mobile wallets in the People’s Republic. The smartphone makers have teamed up with state-owned UnionPay to take on dominant web groups Alibaba and Tencent. UnionPay’s card network and technology may give the new alliance an edge.
U.S. jobs bring gorging market bears up short 8 Jan 2016 Strong employment gains in December support the Fed’s planned gradual rate hikes. The global New Year stock slide stalled, too. Chinese markets stabilized, and investors relished the 292,000 American jobs added last month. The outlook may be murky, but it’s not all bad.
China’s new economy most vulnerable to stock slide 8 Jan 2016 Recent market jitters have dragged valuations for Shanghai-listed groups below their 10-year average. But the Shenzhen bourse, which is dominated by private sector firms, remains relatively expensive. A loss of confidence by retail investors risks choking more vibrant groups.
China proves fast learner of painful market lesson 7 Jan 2016 It ditched a stock-market circuit breaker days after its introduction. Quite right: the mechanism did more to stir concern about pent-up selling pressures than to calm markets. The speed with which China made this volte-face bodes well for its integration into global markets.
China’s FX fall is a new market blight 7 Jan 2016 The yuan’s fall is a new ingredient in a cocktail of concerns that includes slowing growth in emerging economies, lower oil prices and geopolitical tensions. Copycat Asian currency moves would unleash a new wave of disinflation which central bankers are ill-equipped to battle.
China market confusion has investors fearing worst 7 Jan 2016 The tumbling yuan may be a sign the People’s Republic sees currency devaluation as a solution to its economic woes. Or maybe planners are struggling to adapt to more liberal markets. Suspended stocks heighten the sense of chaos. For the rest of the world, the signs are ominous.
Apple’s Asia suppliers have bigger challenge ahead 7 Jan 2016 Reports of coming output cuts have hit shares in several of Apple’s component makers. Erratic sales are to be expected with the iPhone. The real test will be adapting to a more uncertain era where smartphones are no longer the main growth driver.
New World’s new $2.8 bln buyout looks a lot safer 6 Jan 2016 Hong Kong property tycoon Cheng Yu-tung is trying again to buy out his China unit. At up to $2.8 bln, the new offer is worth more than before. It also avoids the archaic rules that killed his 2014 bid. The city’s moguls appear ever-more determined to clean up their houses.
Wanda’s Hollywood ambitions show legendary savvy 5 Jan 2016 The Chinese entertainment group is adding the U.S. studio behind “Jurassic World” to a portfolio that includes a Spanish soccer team and Ironman races. Buying Legendary Entertainment should help fill seats in its cinemas globally – and perhaps even bolster China’s soft power.
China’s new year market volatility is overdue 4 Jan 2016 Falling shares triggered new “circuit breakers” on their first day of operation. The yuan is at its weakest since April 2011. Growing signs of an economic slowdown are feeding the jitters. But the turmoil is also a delayed reaction to previous flawed efforts to prop up markets.
Hong Kong filings get weirder as times get tougher 31 Dec 2015 Companies ended the year reporting stolen accounts, puzzling share sales and a raid by gangsters. UK-style disclosure applied to China’s frontier capitalism has long yielded eyebrow-raising revelations. China’s slowdown is likely to bring ever more strangeness to the surface.
U.S. chipmaker etches path for Chinese suitors 30 Dec 2015 Beijing is encouraging local semiconductor companies to buy foreign rivals. The threat of American lawmakers intervening is real, but CFIUS also has approved multiple deals. Fairchild is using these trends to its advantage in a $2.4 bln sale. It could become a popular playbook.
Deutsche Bank beats sensible retreat from China 29 Dec 2015 The German lender is selling a $3.8 bln holding in retail bank Hua Xia to a local insurer. Like rivals before it, Deutsche is crystallizing a solid return – while admitting that minority stakes on the mainland are of little use. Capital ratios also get a welcome boost.
China index: Economy suffers winter blues 29 Dec 2015 Our index climbed a little higher in November, but underlying data gave little cause for cheer. Exports and rail freight volumes tumbled, investment in residential property suffered the steepest fall since Breakingviews records began in 2008, and pollution hit a 13-month high.
Global smartphone brands face mass extinction 23 Dec 2015 The industry’s growth has slipped below 10 pct for the first time. Apple and Samsung’s high-end phones are taking most of the spoils while upstarts like China’s Xiaomi pick up first-time buyers. Loss-making brands like HTC and Sony may be forced to conclude the game is over.
China will stop ignoring Facebook’s friend request 22 Dec 2015 The People’s Republic has blocked access to the $300 bln social network since 2009. Boss Mark Zuckerberg is eager to leap the Great Firewall. LinkedIn and Apple have shown China’s censors that foreign groups can play by local rules. Finding a local partner should seal the deal.
Chinese corruption drive may thin out M&A bidders 21 Dec 2015 Fosun’s decision to drop its bid for private bank BHF Kleinwort Benson may be unrelated to the brief disappearance of its boss. But corporate predators from China account for 7 pct of global cross-border takeovers. A crackdown on graft could lead to less competition for deals.