Good Morning. Welcome to The Wire’s daily news roundup. Each day, our staff gathers the top China business, finance, and economics headlines from a selection of the world’s leading news organizations.
The Wall Street Journal
- A Chinese Video-Streaming Tie-Up Would Be a Drama Worth Watching — China’s overcrowded video-streaming industry has long been ripe for consolidation.
- One Government Bond Market the Rally Didn’t Reach — There are a number of good reasons to expect the Chinese government bond market to provide returns in the long term and diversification in the short term.
The Financial Times
- Yum China seeks banks for potential Hong Kong secondary offering — New York-listed fast-food group would be latest Chinese company to pursue listing in city
- Pandemic and EU’s neglect tighten bonds with China — Belgrade is key to Chinese regional plans and Brussels’ Covid-19 policy has helped
The New York Times
- As Coronavirus Returns to Beijing, Schools Shut and Flights Are Halted — China’s capital imposed a partial lockdown as a new outbreak raised fears of a broader contagion.
- China Is Collecting DNA From Tens of Millions of Men and Boys, Using U.S. Gear — Even children are pressed into giving blood samples to build a sweeping genetic database that will add to Beijing’s growing surveillance capabilities, raising questions about abuse and privacy.
Caixin
- In Depth: The Billion-Dollar Plan to Replenish Smaller Chinese Banks’ Capital — Policymakers are planning to allow local governments to invest about 200 billion yuan to help risky lenders buckling under too much bad debt
- Ant Financial Takes Step Toward Getting Into Credit Ratings — Alibaba’s fintech affiliate registers new subsidiary with China’s central bank
- Hong Kong Could Attract $550 Billion in Great Listing Migration — Increasingly hostile American environment pushes mainland China companies to consider following NetEase and JD.com as HKEx scrambles to roll out welcome mat
- Mercedes Closes the Hood on Original China ‘Experience Center’ — Luxury-car maker says profits were never the main focus for its first ‘Mercedes me’ China outlet, as it prepares to hand over the concept domestically to a third-party operator
- Trending in China: Cities Attract Livestreaming Celebrities and Influencers with Lucrative Benefits — Pitching products via livestreaming platforms has taken off in China in recent years. The market for livestreamed e-commerce grew to 433.8 billion yuan ($61 billion) in 2019, according to a report by China Consumers Association. Its rapid growth was further fueled by the coronavirus pandemic, as people tuned in to livestreams while stuck at home.
- China’s State Grid Pledges $3.5 Billion Investment in Digital Infrastructure This Year — The State Grid, China’s biggest electricity distributor, has announced plans to invest 24.7 billion yuan ($3.5 billion) in digital infrastructure in 2020 amid efforts to revitalize the economy with investment in “new infrastructure” that supports tech-based projects.
South China Morning Post
- Hong Kong Disneyland to reopen on muted note without parade, contact with mascots not allowed — Hong Kong Disneyland will return on a muted note on Thursday with its popular parade suspended, fewer visitors and guests not allowed to come into close contact with beloved mascots amid the coronavirus pandemic.
- Coronavirus: China’s freeze on imported salmon stirs concern about wider impact on European food trade — Seafood traders in China are bracing for a “psychological blow to consumption” and the possibility of wider disruption to imported proteins after Beijing halted shipments of European salmon amid fears it may be the source of a new coronavirus outbreak.
- China-US tensions pose biggest risk to Chinese economy in the second half of 2020, analysts say — Despite a new outbreak of coronavirus infections forcing authorities to lockdown swathes of Beijing and raising concerns about a second wave of infections throughout China, the deteriorating US-China relationship is now the biggest threat to the Chinese economy, analysts have said.
- China’s Huawei extends UK ad campaign to sway public opinion ahead of 5G security review — Huawei Technologies said it will extend its UK advertising campaign until at least July to try to preserve its role in the country’s 5G network roll out, arguing that it meets the stated requirements for higher security standards, a more resilient network, and more diversified supply chain.
- Coronavirus prompts top-level call for China’s markets to modernise — China’s disciplinary watchdog has called for an overhaul of wholesale food markets to bring them up to modern standards after a coronavirus outbreak led to a return of restrictions in the capital Beijing on Wednesday.
- Hong Kong’s gig economy in media spotlight as freelancers, casual workers struggle amid protests, coronavirus — Media interest in Hong Kong’s struggling gig economy has intensified over the past 12 months, as freelancers and casual workers lost jobs amid the disruptions caused by anti-government protests and the coronavirus pandemic, according to a new study.
- Hong Kong protests and coronavirus see Prada, Tissot make way for cheap phone store on world’s most expensive shopping street — For years it was the world’s most expensive shopping street, overshadowing anything Paris or London had to offer, its pavements brimming with shoppers hunting for Prada bags, Chanel perfumes and Blancpain watches.
Bloomberg
- China’s Carbon Dioxide Emissions Expand Fastest Since 2011 — China’s carbon dioxide emissions from fossil fuels grew by 319 million tons last year, or 3.4%, the most since 2011, according to data from BP Plc’s annual Statistical Review of World Energy.
- China’s New Movies Shine Patriotic Light on Covid-19 Battle — China’s filmmakers are making movies about the coronavirus pandemic, seeking to cast a positive light on the government’s battle to contain the outbreak after criticism of their slow response at the start of the crisis.
- China Wants Banks to Cap Their Profit Gains to Single Digits — China’s financial regulators are asking banks to keep profit growth below 10% this year as they direct the nation’s lenders to support an economy facing its worst slump in four decades, according to people familiar with the matter.
- Tencent Buying iQiyi Smells a Lot Like Uber’s China-Exit Deal — A ride-hailing merger didn’t kill the competition in China. The same could happen with content streaming.
- China’s Tumbling Bond Market Needs a Big Liquidity Injection — Investors in China’s tumbling sovereign bonds are counting on Beijing to unleash more cash into the financial system.
- Carlyle Wary of China Deals as It Braces for Tepid Recovery — Carlyle Group, which has $3.25 billion invested in China, is wary of new deals in Asia’s largest economy as it primes its portfolio companies for a tepid recovery in a world still reeling from the coronavirus.
- China’s Sichuan Trust Is Latest to Miss Payments in Trust Market — Sichuan Trust Co Ltd. has missed payments on trust products, in a further sign of growing risk in the $3 trillion Chinese market for alternative funding for companies unable to access regular bank loans.
- Street Vendors Won’t Save China’s Economy — A new push to welcome informal workers back onto the streets will create more problems than it solves.
- EU Seeks to Counter Chinese Trade Threat With M&A Curbs — The European Union suggested a raft of measures to protect its industries from the potential threat of takeovers by companies bankrolled by China and other foreign powers.
- HSBC’s Guyett Defends China Stance, With Clients Seeking Answers — A top HSBC Holdings Plc executive sought to reassure clients and staff after the bank’s controversial support of China’s proposed security law in Hong Kong, saying that the escalating political rhetoric won’t diminish the appeal of the two markets.
- Oil Declines on Signs of Rising U.S. Stockpiles, Covid Rebound — Oil fell as concerns about a second wave of coronavirus cases in China and signs of rising U.S. stockpiles weighed on the market.
- UBS Drops From Chinese LGBTQ Dating App Blued IPO: ECM Watch — UBS Bank AG is no longer working on the U.S. initial public offering of the owner of Blued, China’s biggest LGBTQ dating app, after gauging the market, joining a number of other banks in curbing work on some U.S. listings by Chinese firms.
- China Inc. Leaving U.S. Market at Fastest Pace Since 2015 — Chinese companies are ditching their U.S. listings at the fastest pace since 2015 as they grapple with rising tensions between Beijing and Washington.
- Sinopharm Jumps Most in 5 Years on Coronavirus Vaccine Data — Sinopharm Group Co. surged by the most since April 2015 on Wednesday to help lead a rally among Chinese health-care names, as the trial results for a Covid-19 vaccine candidate rekindled investors’ enthusiasm for the sector.
- Billionaire Seazen Founder Wang Convicted of Child Molestation — Wang Zhenhua, the billionaire founder of Chinese developer Seazen Group Ltd., was found guilty of child molestation and sentenced to five years in prison.
- Goldman Is a Believer in Huawei Supplier SMIC’s Growth Story — Analysts are split over the future of SMIC, a semiconductor foundry that supplies the tech giant. So far, the believers are winning.
- HSBC Resuscitates Plan to Cut 35,000 Jobs to Boost Growth — HSBC Holdings Plc has restarted cutting as many as 35,000 jobs, three months after the coronavirus outbreak forced it to pause a long-awaited overhaul to boost profitability.
- TikTok Loosens Grip on Political Speech for Black Lives Matter — The hit app has previously attempted to downplay political content.
- Global Energy Demand Growth Was Slowing Before Covid-19, Says BP — Growth in energy demand was declining even before the coronavirus pandemic spread globally, keeping consumers under lockdown and sending prices to record lows, BP Plc said Wednesday.
- UBS Wealth Sees Potential 20% Gains for Asia Stocks Through 2021 — UBS Group AG’s private-banking arm expects Asian stocks to rise with gains potentially exceeding more than 20% by the end of next year, as companies and economies gradually recover from the impact of the pandemic.
- JD.Com Said to Draw Bids at Premium in Gray Market Trading — Institutional investors are bidding for JD.com’s Hong Kong shares before this week’s debut at slightly more than the listing price.
Reuters
- China to step up monetary easing to support economy: cabinet — China will step up monetary easing and keep liquidity “reasonably ample”, the state cabinet said in a meeting chaired by premier Li Keqiang on Wednesday, as it looks to support the economy and help small and medium-sized firms.
- China’s CPIC boosts IPO market with $1.8 billion London listing — Shares in China Pacific Insurance Co (CPIC) rose on their London debut on Wednesday after the company completed the largest fund raising on the London Stock Exchange in three years, sparking hopes of a revival in the market for initial public offerings.
- New U.S. Huawei rule targets standards, security concerns remain: Ross — A new U.S. rule regarding China’s Huawei Technologies Co Ltd is a needed “clarification” to help develop standards, U.S. Commerce Secretary Wilbur Ross said on Wednesday, adding that security concerns remain over the telecoms equipment maker.
- China’s meat importers fret about delays as port runs virus tests — China’s meat importers fear clearing delays and a hit to demand after one of the country’s major ports began requiring coronavirus tests for all meat and seafood containers to prevent contamination.
- Harvard professor pleads not guilty in U.S. to lying about China ties — A Harvard University professor pleaded not guilty on Tuesday to charges that he lied to U.S. authorities about his ties to a China-run recruitment program and funding he received from the Chinese government for research.
- China keen to seek benefits from pandemic, distressed U.S. assets: report — U.S. lawmakers and policymakers should be wary of China’s moves to target vulnerable U.S. assets and expand its market share in the wake of the global economic crisis triggered by the novel coronavirus, according to a study prepared for a U.S. trade group and released on Tuesday.
- Barrick Gold sells majority stake in China’s Shandong for $210 million — Canadian gold producer Barrick Gold said on Tuesday it sold a partial stake in Shandong Gold Mining Co for $210 million, profiting off a rise in share price of the Chinese gold miner.
Xinhua
- Factbox: China’s progress on economic resumption — As efforts to contain COVID-19 continue, China is steadily reviving its economy. The following facts and figures indicate how the country is forging ahead in the economic sphere.
- China to accelerate non-performing loans settlement — Chinese authorities have said they will accelerate the settlement of non-performing loans (NPLs) in the second half of the year, while analysts are calling for attention to small and medium-sized housing companies and companies dependent on foreign demand.
- China launches crackdown on online copyright infringement — Chinese authorities launched a nationwide campaign to crack down on online copyright infringement and piracy.
- China’s power generation grows faster in June — China’s electricity generation is rising at a faster pace after a significant increase in May, buoyed by growing demand, the State Grid Corporation of China (SGCC) said on Wednesday.
- China sees boom in live-streaming industry — China has seen fast growth in its live-streaming industry over the past years, data showed.
- Shanghai’s exports grow 2.3 pct in Jan.-May period — Shanghai’s exports grew by 2.3 percent year on year over the first five months in 2020 to reach 530 billion yuan (about 74.7 billion U.S. dollars), the Shanghai Customs said Wednesday.
- INVISTA breaks ground on chemical plant in Shanghai — INVISTA Nylon Chemicals (China) Co., Ltd. held a groundbreaking ceremony in Shanghai Tuesday to officially mark the start of construction on its 400,000-tonne per year adiponitrile (ADN) plant at the Shanghai Chemical Industry Park.
- Chinese shares close higher Wednesday — Chinese stocks closed higher on Wednesday, with the benchmark Shanghai Composite Index up 0.14 percent to end at 2,935.87 points.
Other Publications
- TechCrunch: ByteDance to shut down Vigo apps — Chinese internet giant ByteDance has announced plans to discontinue two of its apps in India, its biggest overseas market, and urged users to move to TikTok.
- Science: Fifty-four scientists have lost their jobs as a result of NIH probe into foreign ties — Some 54 scientists have resigned or been fired as a result of an ongoing investigation by the National Institutes of Health into the failure of NIH grantees to disclose financial ties to foreign governments. In 93% of those cases, the hidden funding came from a Chinese institution.
- AG Web: Here’s the Motive Behind China’s Recent Big Buys of Soybeans — Monday’s market news started off with a bang, as USDA confirmed more reports of China buying U.S. soybeans. USDA reported private exporters bought 390,000 metric tons of soybeans for delivery in the 2020/2021 marketing year. As China ramps up its purchases from the U.S., China may be buying out of necessity, instead of buying to live up to its Phase One trade promises. “They are driven right now primarily by a fear; fear of shortages,” says Arlan Suderman.
- Forbes: China Is $8 Trillion Away From Eclipsing Trump’s Economy — Admittedly, it’s become a cliché to compare this or that shock to how the Soviet Union’s 1957 satellite launch rocked America. But economist Richard Duncan has a point that Beijing’s aggressive investments in 5G and other technologies, with President Donald Trump focused on bringing back coal, is its own “national emergency.”
- McKinsey: Leading the battle against climate change: Actions for China — According to McKinsey’s analysis, if emissions continue to rise at the current rate, the threats of extreme heat and lethal heat waves could affect 10 to 45 million people by 2030, particularly in East China. The average share of outdoor working hours lost each year to extreme heat and humidity would increase from 4.0 percent today to as much as 6.5 percent in 2030 and 9.0 percent in 2050—equivalent to $1 trillion to 1.5 trillion in GDP at risk in an average year by 2050. The kind of heavy precipitation that was a once-in-50-years event in 1980 is expected to be two to three times more likely in 2030 and three to six times more likely in 2050 (Exhibit 1).
- Forbes: Asian Perspectives On The Post-Covid-19 World — Five members of the Forbes Asia Panel of Economic Commentators shared their insights from a broad range of interconnected perspectives on how the world may have been changed by Covid-19. The perspectives covered include undimmed prospects for emerging markets, Asia’s successful strategic responses, the emergence of stronger China-centric supply chains, government interventions in Japan, and Hong Kong’s abiding strategic importance. Together, they form a surprisingly positive take on the post-Covid-19 future.
- CNN: Pentagon warns China is exploiting the coronavirus pandemic to wage ‘economic warfare’ on the US — But even as the Defense Department works to improve supply security, procurement experts warn that the Pentagon may not have the visibility required to vet or help protect smaller companies down the chain. They say the job is only getting harder as the pandemic has broadened the definition of national security interests to include medical supplies. And they point to at least one Chinese-owned company that asked to bid on a Pentagon contract.
- Jing Daily: Will European Luxury Collapse Without Chinese tourists? — With wealthy shoppers from Asia and the Middle East absent, the European luxury industry is hanging on by a thread. According to Reuters, global tourists from China, Russia, and the Middle East make up between 35-55 percent of revenues in Europe, depending on the brand.
- Jing Daily: Can Fashion in China Get Woke? — Brands must start researching and investing in the “woke” activities that drive today’s youth fashion scene in China. By addressing current issues, brands can resonate so strongly with young Chinese consumers that they’ll create long-term attachments. And despite the country’s political limits, some issues are relatively safe to address. They include sustainability, women’s bodies, and inclusivity.
- AP News: China delays launch to complete GPS-like Beidou network — Citing technical reasons, China has delayed the launch of the final satellite to complete its Beidou Navigation Satellite System constellation that emulates the U.S. Global Positioning System. The official Xinhua News Agency said Tuesday’s mission aboard a Long March-3 rocket from the southwestern satellite launch base of Xicheng was scrubbed after pre-launch checks discovered “product technical problems.”
- Marketplace: China’s big savers weather pandemic uncertainty — So how can a person who didn’t get paid a regular salary for four months afford a last-minute beach vacation? Part of the answer is that service workers like Zhang are often provided dorm rooms by their employers. He does not pay rent in pricey Shanghai. The latest available data on savings in China comes from 2016. It shows the average household put away 36% of disposable income, compared to just 7% in the U.S.