China’s Xiaomi embarks on Apple’s road not taken 13 Mar 2024 The $48 bln handset-maker said it will deliver its first electric car just weeks after the iPhone-maker scrapped its decade-long effort. CEO Lei Jun faces overcapacity and slowing growth at home. Still, deep pockets and a software edge will help Xiaomi navigate brutal price wars.
China can afford to holster monetary bazooka 11 Mar 2024 Consumer prices rose 0.7% in February, the most in nearly a year but far below Beijing’s 3% target. Still, the central bank's piecemeal easing is starting to add up. Expected US rate cuts will make it easier for China to stimulate the economy and avoid a deflationary doom loop.
Nickel rout is energy-transition warning for West 8 Mar 2024 Prices of the battery metal have halved in a year, leaving many mines unprofitable or mothballed. Indonesia’s China-backed industry now dominates. Piecemeal aid and a green premium push are unlikely to alter that. Absent smart planning, copper and lithium are vulnerable, too.
JD gives China bargain hunters glimmer of hope 7 Mar 2024 The $36 bln retailer improved quarterly sales and profitability and is boosting dividends and buybacks. It's nothing spectacular, but JD's beaten-down shares rallied 16%. Amid geopolitics, China's economic woes and rock-bottom valuations, getting back to basics can pay off.
China’s new tastes will spit out more than Apple 6 Mar 2024 The iPhone maker is losing share in the People’s Republic to domestic champion Huawei. American companies in the giant market face both weakening demand and a move to homegrown brands. Chinese consumers’ shifting attitudes suggest the woes will worsen.
China Vanke looks too favoured to fail 6 Mar 2024 Investors are dumping the $14 bln developer’s bonds and stock on reports it wants to extend its debt. The firm says it can repay $630 mln due next week. And crucially, it has the effective backing of the Shenzhen government. Letting Vanke go under would send markets into a panic.
China’s economic managers have half a plan 5 Mar 2024 Beijing has kept last year's targets of 5% GDP growth and 3% inflation for 2024. Yet the economy has deteriorated, making them much harder to hit without stimulus. Plans to issue $139 bln of special bonds this year look promising, but details will be key to boosting confidence.
China’s financial clout will be hard to reverse 4 Mar 2024 Exports from the People’s Republic upended the world economy. Its $4.3 trln hoard of foreign assets is doing the same for global finance. As with trade, winding back the clock will not work. Multilateral problems require multilateral solutions.
Baidu may be the world’s most unloved AI stock 29 Feb 2024 China's $36 bln search-engine operator lags leaders like Microsoft but is making progress on its answer to ChatGPT. Yet the stock plunged 8% despite decent results and it now trades below 10 times forward earnings. Blame a rout in Chinese equities and overly high expectations.
Geely’s $7 bln Lotus deal breaks speed limit 28 Feb 2024 The Chinese automaker has listed the storied brand in the US via a SPAC at a racy valuation. That's hard to justify with electric-car sales growth slowing. A plan to take advantage of lower-cost manufacturing in Wuhan has also aged poorly as concerns mount over Chinese exports.
Shenzhen offers glimpse of China’s housing future 28 Feb 2024 The tech hub’s plan to put 60% of its 18 mln residents in subsidised homes answers President Xi Jinping’s call for a “new development model” prioritising affordability. The state is reclaiming a lead role in the property market of the world’s second-largest economy, at huge cost.
Shein’s IPO backup plans can unravel 27 Feb 2024 The fast-fashion retailer is eyeing London, Singapore and Hong Kong as its US listing hits a snag, per Bloomberg. Those venues might allow the profitable firm's backers to cash out faster. But recent New York debuts show Plan A still outshines the rest.
Ant puts its talent for disruption back on display 26 Feb 2024 The Jack Ma-founded fintech firm has outbid Citadel for Credit Suisse's investment-banking unit in China, Bloomberg reports. A deal makes little sense but would signal the payments-to-lending group is back in good standing with Beijing. A smaller Ant can still surprise.
Macau’s casino comeback underwhelms 23 Feb 2024 Chinese tourists are shunning pricey overseas trips for destinations closer to home. That helped MGM, Wynn and peers lure an impressive 170,000 daily punters over the Spring Festival. Yet, those stocks have lagged Trip.com and other travel bets. Blame debt and a cloudier outlook.
HSBC’s yawning discount is too harsh 21 Feb 2024 The $155 bln lender took a big impairment on its stake in China’s BoCom bank. That aside, shareholder returns have been consistently strong and look set to remain so. The successful push into Asia beyond Hong Kong suggests boss Noel Quinn is riding geopolitical waves well, too.
Alibaba is the ultimate contrarian China bet 21 Feb 2024 The $188 bln e-commerce group was once emblematic of the country’s growth and tech innovation. But over-expansion, regulatory crackdowns, and slowing consumption are forcing CEO Eddie Wu to perform a hard reset. Winning back investors requires Beijing to correct course too.
JD is logical winner of odd UK retail bidding war 19 Feb 2024 The $37 bln Chinese e-tailer is mulling an offer for Britain’s Currys, also the subject of interest from Elliott Advisors. A feeding frenzy for a sub-$1 bln UK asset with an unproven turnaround story sounds weird. But JD.com’s need to expand overseas is a strong motivation.
China offers more New Year red flags than packets 19 Feb 2024 A record number of Chinese travelled for the holiday, trips were up 19% from 2019, but they spent less per journey. Overseas travel remains subdued. Consumer tastes are changing but the low confidence fuelling deflation is evident. On that front, there is limited festival cheer.
Nickel aid is too little, too late 19 Feb 2024 Miners of the electric vehicle battery metal will get royalty relief and help from Aussie taxpayers. It's unlikely to reverse decisions by First Quantum, IGO, and Wyloo to mothball projects after prices crashed. Developing critical minerals requires a robust long-term strategy.
Xi can wait out the Anywhere-But-China trade 8 Feb 2024 Removing the chair of the securities regulator offers a scalp for the market crash as domestic and foreign investors dump stocks and claw at other destinations. Confidence is flagging, but the Chinese leader's best option may be to let benchmarks find a bottom first.