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
- Hong Kong Market Accentuates the Positive After New Security Law — Investors have overcome initial discomfort at China’s tightening grip on the city, focusing instead on how the law could curb unrest and encourage an influx of mainland money.
- Foreign Home Buying Dries Up, Easing the Way for Domestic Buyers — Foreign buying of U.S. homes was a driving factor in markets from California to Florida, helping prices reach new highs. Now, the pandemic, reduced travel and immigration restrictions are further undermining already weakening international demand.
- Hong Kong Security Law Means It’s No Longer Business as Usual — The breadth of the law and rapidly deteriorating relations between China and the West raise the prospect that international businesses or their employees could eventually become targets.
- U.S. Warns Businesses Over Supply Chains Tied to Rights Violations in China — The administration said companies face legal risks for involvement with entities in China blamed for human-rights abuses, including the mass detention of Uighur Muslims.
The Financial Times
- British Steel’s Chinese owner in last-ditch push to buy French factory — Jingye’s bid for plant at risk due to unease over Chinese presence in European industry.
- Australia plans to offer safe haven to Hong Kong residents — Canberra considers UK’s ‘Five Eyes’ request after Beijing imposes security law on territory.
The New York Times
- As China Strengthens Grip on Hong Kong, Taiwan Sees a Threat — The sweeping new security law in Hong Kong has further eroded what little support there was in Taiwan for unifying with the mainland.
Caixin
- Chinese Insurers Now Can Trade Treasury Bond Futures, but for Hedging Only — Insurance and banking regulator issues new rules clearing the way for the top investors in longer-term treasury bonds to use futures contracts for better risk management.
- TikTok Owner Predicts Over $6 Billion in Losses From India Apps Ban, Sources Say — ByteDance expects veto over national security claims to cost it more than all the other companies affected.
- Luckin Coffee Probe Confirms Scope of Financial Reporting Fraud — Independent internal investigation’s findings lead to six more firings as board calls special meeting to consider ousting founder and Chairman Lu Zhengyao.
- Pinduoduo Founder Steps Down as CEO, Reduces Ownership — Colin Huang Zheng will continue as chairman and retain overwhelming control after donating nearly $14 billion of his company shares.
- Meituan Eyes Robot-Enabled Deliveries with $14 Million Investment in PuduTech — The use of robots for “contactless” meal and drug deliveries in some Chinese hospitals during the Covid-19 outbreak has not only surprised the general public, but also attracted the attention of investors betting on a future when machines can take on many jobs previously done by humans.
- Sina Weibo to Issue $750 Million in Bonds — Sina Weibo, a Twitter-like social media platform in China, is issuing $750 million in bonds, becoming the latest Chinese internet major to take advantage of positive sentiment to raise big funds from international investors this year.
South China Morning Post
- JD.com’s fintech arm prepares for IPO in Shanghai’s Star Market — JD Digits, the financial technology arm of e-commerce giant JD.
- China firmly opposes Britain’s offer of residency rights to Hongkongers and warns of ‘corresponding measures’ — China has warned it may take “corresponding measures” following the British government’s offer of residency rights and a path to citizenship to millions of Hongkongers after Beijing imposed a harsh national security law on the former British colony.
- Shanghai’s quest to be global financial centre gains impetus from Hong Kong troubles but big obstacles remain — China’s decades-old quest to make Shanghai an international financial hub has gained a bit of momentum as Washington mulls tightening China’s access to US capital markets and the future of Hong Kong is clouded by Beijing’s imposition of a national security law.
- Weaves ‘made from hair of China’s Xinjiang camp detainees’ seized on arrival in US — Authorities in New York on Wednesday seized a shipment of weaves and other beauty accessories suspected to be made from human hair taken from people locked in an internment camp in China’s far west Xinjiang region.
- Schroders buys control of Hong Kong’s property manager Pamfleet, in a vote of confidence amid city’s frayed nerves — Schroders, the 216-year old UK-based multinational asset manager, has bought control of a Hong Kong real estate investment manager, in a vote of confidence of the city’s role as a regional hub for financial and professional management services, even as it finds itself caught in the escalating rivalry between the US and China.
- China’s tech tycoons flood Hong Kong with US$20 billion of stock listings — China’s technology tycoons are flooding Hong Kong’s stock exchange with US$20 billion worth of new listings, reinforcing the city’s position as a major financial hub in Asia.
- China cracks down on ‘themed towns’ in a bid to stop local governments wasting coronavirus stimulus funds — Local Chinese governments will no longer be able to build the extravagant and controversial “themed towns” that popped up around the country after Beijing’s post-global financial crisis infrastructure splurge, the country’s state planner has announced.
- Senator Marco Rubio seeks to ban Chinese firms from US capital markets — A top senator is preparing a bill to ban Chinese companies from US capital markets if they engage in spying, human rights abuse or support China’s military, threatening a financial blow as tensions mount over Covid-19 and Beijing’s crackdown on Hong Kong.
- American firms’ move into China over past 20 years threatens US ability to lead and compete: report — The United States’ ability to be an industrial competitor and long-term tech leader might be eroded by the expansion of its multinational firms into China over the past two decades, a US congressional committee said.
- Work begins on Nigeria’s China-funded US$2.8 billion gas pipeline — Nigeria has started construction of a US$2.8 billion Chinese-funded pipeline that will boost energy supply in a country dogged by power shortages, despite being Africa’s largest oil and natural gas producer.
Bloomberg
- China Vehicle Sales Rise for Third Month as Pandemic Eases — Vehicle sales advanced for a third straight month in China, signaling that an economic rebound is gathering pace as the coronavirus pandemic gradually abates in the country.
- China’s Corporate Bond Defaults Unveil Hidden Blind Spots — China’s policy makers have been walking a tightrope between countering the economic damage caused by the Covid-19 crisis and fueling another debt bubble from the latest spending spree.
- Hong Kong Stocks Greet New Law With Gains, Backed by Mainland — Stocks in Hong Kong rose on their first trading day since new national security laws were imposed on the city, amid signs mainland Chinese buying was behind some of the gains.
- How a Chinese Firm Jumped to the Front of the Virus Vaccine Race — When a group of Chinese scientists gathered over barbecue and beer in a Toronto backyard a decade ago, talk drifted to their homeland’s vaccines, which had long lagged the developed world on quality and safety. Four of them decided to act.They left top positions at global pharmaceutical companies in Canada to set up a biotechnology firm half a world away in Tianjin, China, hoping to produce vaccines on par with Western countries.
- China Beauty Firm Said to Pick Goldman, Morgan Stanley for IPO — The Chinese company behind the fast-growing Perfect Diary cosmetics brand has picked Goldman Sachs Group Inc. and Morgan Stanley to prepare for a potential initial public offering, according to people familiar with the matter.
- China Inches Closer to Merging Top Brokers in Industry Shakeup — China is speeding up the process of potentially merging its two biggest investment banks, in a move that would create a $82 billion powerhouse and may spark a wave of consolidation among the country’s more than 130 brokers.
- China is Not the Middle East’s High Roller — Beijing gets far more credit than it is due for investments in the region.
- India’s Ban Gives China Tech Giants the Flipside of Protectionism — Protectionism cleared the way for mainland upstarts to grow into giants. Now, they’re finding overseas markets closing against them.
- Evergrande’s 101% Rally May Slow After $410 Million Buyback — Real estate mogul Hui Ka Yan’s vast wealth has soared by $13.2 billion since late March, thanks in part to a wave of stock buybacks that sparked a 101% gain for his Chinese property firm. The billionaire is now running low on fuel to propel the shares higher.
Reuters
- U.S. House bill targets banks amid fears over China law for Hong Kong — The U.S. House of Representatives passed legislation on Wednesday that would penalize banks doing business with Chinese officials who implement Beijing’s draconian new national security law imposed on the former British colony of Hong Kong.
- China’s Chalco shuts down 10% of its alumina capacity — Aluminum Corp of China Ltd, known as Chalco, said on Thursday it would implement “flexible production”, a phrase used to refer to output cuts, at three alumina production lines accounting for about 10% of its total capacity.
- Apple supplier Foxconn, others hit as India holds up imports from China: sources — India’s additional scrutiny of imports from China has disrupted operations at plants owned by Apple supplier Foxconn in southern India, three sources told Reuters, and other foreign firms are also facing delays as tensions between the two countries build.
- Faraday Future’s Chinese founder completes personal bankruptcy process — Jia Yueting, founder of Leshi Internet and electric vehicle (EV) maker Faraday Future, said on Thursday his personal bankruptcy process is complete and that a trust would be established to compensate Leshi shareholders.
- China’s CNPC targets 50% slash in methane emission intensity by 2025 — China National Petroleum Corp (CNPC), the country’s biggest oil and gas producer, plans to deepen its cut on methane emissions and set a more ambitious pledge than its previous commitment to the Oil and Gas Climate Initiative (OGCI).
- Exclusive: U.S. delays American diplomats’ return to China amid concerns over coronavirus testing, quarantine — The United States has postponed flights for dozens of American diplomats who had planned to return to China later this month, after failing to reach agreement with Beijing over issues including COVID-19 testing and quarantine.
- U.S. Commerce official resigns, viewed as moderating voice on China export issues — A senior U.S. Commerce Department official involved in export policy has resigned, a spokesman said on Wednesday, marking the departure of a moderating voice in the Trump administration about export restrictions on Huawei and other Chinese companies.
Xinhua
- China takes new approach to replenish capital for small, medium banks — China will allow special local government bonds to appropriately support small and medium-sized banks in replenishing capital, in the latest move to strengthen financial support for enterprises.
- Shanghai’s beef imports register strong rise in Jan-May — A total of 394,000 tonnes of beef were imported via Shanghai Customs in the first five months of this year, up 51.8 percent from the same period last year, data from the customs authorities showed.
- Chinese firms see improving business climate in Q2 — Chinese firms reported an improving business climate in the second quarter of the year, a central bank survey showed Thursday.
Other Publications
- The Next Web: Inside China’s plan to lead the world in AI — China announced in 2017 its ambition to become the world leader in artificial intelligence (AI) by 2030. While the US still leads in absolute terms, China appears to be making more rapid progress than either the US or the EU, and central and local government spending on AI in China is estimated to be in the tens of billions of dollars.
- CNN: China is storing an epic amount of oil at sea. Here’s why — China bought so much foreign oil at dirt-cheap prices this spring that a massive traffic jam of tankers has formed at sea waiting to offload crude. As of June 29, China – the world’s second-largest consumer of oil after the United States – had amassed 73 million barrels of oil on 59 different ships floating at sea off the country’s northern coast, according to ClipperData, which tracks waterborne flows of crude oil in real-time. For context, that is three-quarters of the demand for the entire planet.
- Variety: China’s FIRST Film Festival Set to Run in Late July — The FIRST International Film Festival this week announced that it will occur with in-person screenings from July 26 to August 3 in China’s Qinghai province — implying that cinemas will be open in at least parts of the country by the end of the month. This would make it among the first festivals in the world to occur since the novel coronavirus, and one of few that has not had to cancel or change its originally planned dates.
- Yahoo Sports: U.S. Senator sends letter to Adam Silver questioning NBA relationship with China — The NBA’s relationship with China — which dates back to the 1980s — is in as bad a spot as it has been in decades following a Tweet by Rockets GM Daryl Morey last fall supporting the protestors in Hong Kong. NBA games have not been shown on state television in China all season following that. Heading into the height of an election season, Sen. Marsha Blackburn, a Republican from Tennessee, has decided to try to make the NBA’s relationship with China a political football.
