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
- Global Stocks Waver While China Rally Powers Ahead — International stocks mostly edged lower while mainland Chinese shares extended a winning streak for a seventh consecutive day.
- Chinese Tech Firms Get Trading Boost From Hong Kong Listings — Hong Kong is becoming an active center for trading stock in some of China’s largest technology groups, bolstering the case for more secondary listings of U.S.-listed Chinese companies.
- The Other Chinese Property Debt to Worry About — Chinese property developer Tahoe Group failed to pay bondholders this week. It’s worth keeping an eye on what happens to its other creditors—Chinese buyers of unbuilt homes.
- Colleges Brace for Sharp Drop in Foreign Students, Especially From China — U.S. colleges are bracing for a devastating drop in international students this fall, especially ones from China, where many U.S.-bound students are now postponing plans—and even rethinking the value of an American degree.
- Cosco Strikes Blockchain Pact for Ocean Cargo With Alibaba, Ant — China’s state-run container line Cosco Shipping Holdings Ltd. will work with Alibaba and Ant, the e-commerce giant’s financial technology affiliate, on using blockchain technology to track goods across seaborne supply chains.
The Financial Times
- US imposes visa restrictions on Chinese officials over Tibet — Move follows similar efforts by Trump administration over Xinjiang and HK policies.
- China scales back meat imports over virus concerns — Restrictions against processing plants in US, Europe, Brazil, and Canada to push up food prices.
- Border clash prompts Indian industry to seek China alternatives — Companies cultivate local suppliers as authorities signal plans to reduce economic ties.
- Hong Kong’s bourse reaps benefits of China homecomings — Shares have hit a record despite deepening political turmoil.
The New York Times
- White House Warns Against Chinese Investment, Citing Risk of Further Sanctions — Economic and security officials warned a federal fund against putting retirement savings in China at “a time of mounting uncertainty” for the relationship.
- State Department Bars Chinese Officials Who Restrict Access to Tibet — Secretary of State Mike Pompeo said international access to Tibet was a matter of regional and environmental security. He did not say how many Chinese officials were being blocked from the U.S.
- Internet Powers Collide in Hong Kong — Tech giants suspend handing over information to Hong Kong, setting up a collision with China.
Caixin
- In Depth: Inside the Illicit Business Running Up China’s Credit Card Debt — ‘Cash-out services’ allow individuals and businesses to tap their credit cards for cash loans by disguising the transactions as purchases that never take place.
- Haidilao Expected to Report $143 Million 1st Half Net Loss — Chinese hotpot chain’s revenue fell 20% amid pandemic shutdowns across China as effort to compensate by jacking up prices fizzled amid online boycott.
- Sequoia China Leads Nearly $100m Round in Storytelling App Kuaidian — Kuaidian, a Chinese storytelling mobile app that offers an immersive experience through dialogue-based, text-message reading format, has closed nearly $100 million in a Series C round of financing led by Sequoia Capital China.
- Cornell to Let Stranded Chinese Students Attend Local Colleges — Cornell University has said Chinese students unable to attend college this year due to coronavirus restrictions will be able to study at designated universities in China.
- Medical Robot Maker Finds Elixir in STAR Board’s Market Reforms — It may still be losing money, but Chinese investors are still seeing plenty of potential in a specialist maker of robots that assist in bone surgery.
South China Morning Post
- Hong Kong steps in to weaken the local dollar, as hot money inflows defy doomsday talk of capital flight after China’s security law — Hong Kong’s monetary authority sold HK$15.31 billion of local dollars on Monday and Tuesday to weaken the currency and bring it back within its trading band. Hong Kong’s de facto central bank had to intervene 24 times this year, spending up to HK$72.94 billion to maintain the dollar’s trading band.
- China’s car sales still showing signs of growth as world’s largest market recovers from coronavirus impact — China’s car sales continued to recover in June, the China Passenger Car Association said on Wednesday.
- China’s interest in trans-Pacific trade deal met with scepticism by those who helped negotiate it — A series of high profile officials in Beijing have recently voiced openness about China joining a trans-Pacific trade pact abandoned by the United States in one of the first acts of Donald Trump’s presidency.
- Coronavirus: sign-ups lag for Hong Kong’s restaurant discount campaign, while fears mount social-distancing rules could tighten again — Fewer Hong Kong restaurants than expected have so far signed up for a discount campaign intended to boost a sector slammed by the Covid-19 pandemic, now in its third wave in the city.
- China power firms suspend publication of coal data, frustrating analysis of industrial production — The publication of daily coal consumption data from China’s main power companies, which is widely used by economists to gauge industrial output and broad economic activity, has been suspended after the electricity providers stopped reporting their numbers.
- China vows to ban US officials who ‘act abominably’ over Tibet — China’s foreign ministry said on Wednesday it would respond to a US travel ban on officials accused of limiting access to Tibet with similar curbs.
- Alibaba Cloud expands global reach via two new international partnerships — Alibaba Cloud, the data backbone of Chinese e-commerce giant Alibaba Group, is expanding its global footprint via partnerships with international companies, including internet connection and data centre company Equinix and wide area network (WAN) company Aryaka.
Bloomberg
- VC Fund Backing Firms Worth $206 Billion Eyes China Startups — David Chao, a venture capitalist who has been on the ground floor of Asian companies worth a combined $206 billion, has raised money for a new fund with a China focus, a sign that rising U.S.-China tensions aren’t turning off foreign investors.
- Signal Tops Hong Kong Downloads After Fears of China Law Deepen — Signal has become the most-downloaded app in Hong Kong after Beijing imposed a sweeping national security law on the city that stirred fears of curbs on civil liberties.
- U.S.’s War on Huawei Begins to Turn After Rough Year for Europe — Huawei Technologies Co. has gone from a crucial component of U.K. and French mobile networks to potential outcast, after resistance and compromises began to give way to a relentless White House campaign.
- HSBC Slumps as U.S. Weighs Moves to Punish Hong Kong Banks — HSBC Holdings Plc, which draws more than two-thirds of its pretax income from Hong Kong, slumped as advisers to U.S. President Donald Trump discussed a potential move to punish banks in the city and destabilize the currency peg to the dollar.
- China’s Digital Yuan Gets First Big Test Via Tech Giant Didi — Ride-hailing giant Didi Chuxing is testing China’s digital cash as a payment method on its platform, in what could be one of the first real-world applications of the electronic version of the yuan.
- China Industrial Firms Face Refinancing Risks as Debt Wall Looms — Refinancing pressure is mounting at China’s industrial firms following unprecedented pandemic-induced shocks to the sector and a dearth of bond issuance in the past three months.
- U.S. Options to Break Hong Kong Peg Impractical, Economists Say — The threat of U.S. action to undermine Hong Kong’s longstanding U.S. dollar peg is highly unlikely to become reality given the practical difficulties of pursing such a path and the damage it would do to U.S. interests, economists say.
- China to Sell More Pork From Reserves to Stem a Rally in Prices — China will sell more frozen pork from state reserves as it seeks to contain rallying prices after the top consumer of the meat halted imports from dozens of overseas producers.
- The Virus Has Trapped $111 Billion of Luxury Spending in China — Jeff Meng, a 25-year-old watch lover from a well-heeled Guangdong family, had 160,000 yuan ($22,800) burning a hole in his pocket. He could not find the Rolex Daytona watch he wanted, dubbed “panda” for its black-and-white face, anywhere in China.
- Britain’s Nuclear Future Uncertain as Relations With China Fray — Britain’s fraying relationship with China has the potential to undo a decade of mixed efforts to keep nuclear power flowing as an aging generation of plants drop out of service.
- What the Hong Kong Dollar Peg Is and Why It Matters: QuickTake — Pegged to the U.S. dollar since 1983, the Hong Kong dollar is usually a dull currency. Except when it isn’t. Heightened tension between the U.S. and China over the city’s autonomy has focused attention on it yet again.
- China’s Makeshift Stakes Won’t Be Enough to Save Small Banks — Beijing knows that small lenders are getting crushed. The latest move to prop them up seems as makeshift as the rest.
- How Hong Kong Sanctions Could Threaten Wall Street: QuickTake — Citigroup Inc., JPMorgan Chase & Co., HSBC Holdings Plc and their peers face a threat to their massive expansion plans in China from a U.S. move that would sanction Chinese and Hong Kong officials involved in imposing a national security law on the former British colony. Wall Street and their European rival’s push for Chinese riches could be further imperiled should China retaliate.
- Wray Says China Hacking, Pressure Put Americans ‘Over a Barrel’ — The Chinese government uses an extensive array of tactics to steal U.S. trade secrets and influence U.S. politics, FBI Director Christopher Wray said.
Reuters
- China coerces hundreds of Chinese-born critics in U.S. to return home, FBI chief says — The head of the FBI said on Tuesday Chinese President Xi Jinping was spearheading a program aimed at strong-arming Chinese-born people in the United States deemed as threats to Beijing to return home – even threatening their families.
- China hires Morgan Stanley, Goldman Sachs to advise on pipeline asset transfers: sources — Top Chinese energy firms have mandated investment banks Morgan Stanley and Goldman Sachs to act as advisers for multi-billion dollar deals transferring oil and gas pipeline assets into a national energy infrastructure giant, four sources said.
- Tesla China sold 14,954 Model 3 vehicles in June, up 35% on the month — U.S. electric vehicle maker Tesla Inc sold 14,954 Shanghai-made Model 3 vehicles in China in June, up 35% month-on-month, according to the China Passenger Car Association (CPCA).
- China’s Henan to hike utility fees for polluting steel, cement firms — China’s central province of Henan will from Aug. 1 hike water and electricity fees for cement and steel producers that have failed to meet ultra-low emission standards, the provincial environment regulator said on Wednesday.
- Credit Suisse aims for 100% of securities venture in China growth plan — Credit Suisse wants to raise its China securities joint venture stake to 100% and increase its market share after getting the regulatory green light to take a majority holding, the head of its Asia business said.
- Chinese factories to face headwinds in next phase of post-lockdown recovery — Orders for infrastructure materials and equipment have helped industrial output recover faster in China than most places emerging from COVID-19 lockdowns, but further expansion will be hard to attain without stronger broad-based demand and exports.
- Breakingviews – This Chinese stock pop has firmer fundamentals — China’s latest stock pop mixes the bitter with the sweet. Indexes have spiked to levels not seen since 2015, and leverage is rising, adding to fears of a crash. Weakness in shadow banking and property are pushing speculative funds into shares, but the rally is also underpinned by reforms accelerating a shift into equities.
- Stocks, oil slip but Chinese stocks rally a sixth day — Investor caution over renewed coronavirus-related lockdowns buoyed the dollar and snapped a five-day rally in most world equity markets on Tuesday, but was not enough to halt a hot streak in Chinese stocks.
- Ericsson says not sourcing products from China’s Panda Electronics — Ericsson is not sourcing products from Panda Electronics Group, one of the companies named by the United States as potentially controlled by the Chinese military, the Swedish telecom gear maker said on Tuesday.
Xinhua
- China’s real estate financing warms up in June — China’s real estate financing has seen great expansion last month, while pressure still exists in the second half of this year, analysts said.
- China’s central bank skips reverse repos for 8th straight trading day — The People’s Bank of China (PBOC), the country’s central bank, skipped open market operations via reverse repos for the eighth consecutive trading day on Wednesday.
- Xinjiang’s electricity transmission increases by 53.9 pct in H1 — Northwest China’s Xinjiang Uygur Autonomous Region transmitted 43.9 billion kWh of electricity in the first half of 2020, up 53.9 percent year on year, according to the State Grid’s Xinjiang branch.
- 5G empowers oil, gas production in NW China’s Taklimakan Desert — A 5G base station that recently began operation in the heart of Taklimakan Desert is expected to help in the construction of an intelligent oilfield in the desert.
- China Merchants Securities sees rising profits in June — China Merchants Securities Co., Ltd., a major Chinese securities firm, on Wednesday reported rising net profits in June.
- BYD new-energy vehicle sales slump in H1 — China’s leading new-energy vehicle (NEV) manufacturer BYD saw its NEV sales tumble in the first half of 2020, company data showed.
- China’s local gov’ts issue bonds worth 3.49 trln yuan by end-June — China’s local governments have issued around 3.49 trillion yuan (about 496.5 billion U.S. dollars) worth of bonds in the first half of this year, official data showed Wednesday.
- China’s agricultural product wholesale prices edge up — The wholesale prices of China’s agricultural products registered a slight uptick Wednesday, according to a report from the Ministry of Agriculture and Rural Affairs.
Other Publications
- Forbes: Could The Indian Navy Strangle China’s Lifeline In The Malacca Strait? — India has enjoyed one area of strategic advantage over China for many years. Chinese industry relies on shipping routes which move goods and oil through the Malacca Strait between Malaysia and Indonesia. This narrow waterway is a perfect choke point. India’s natural position in the Indian Ocean, with basing capabilities in the Andaman and Nicobar Islands at the mouth of the strait, would allow its Navy to cut it off in the event of a crisis or war. But increasingly China may be able to, quite literally, get around this.
- Foreign Affairs: Is Taiwan the Next Hong Kong? — Unless the United States demonstrates the resolve and ability to resist Chinese coercion and aggression, China’s leaders may eventually conclude that the risks and the costs of future military action against Taiwan are low—or at least tolerable.
- The Atlantic: A Nationalist’s Guide to Stepping Back From the Brink — Indian Prime Minister Narendra Modi demonstrates how to de-escalate a conflict while also saving face.
- POLITICO: How US restrictions drove Deutsche Telekom and Huawei closer together — Global telecoms giant Deutsche Telekom strengthened its strategic partnership with Huawei last year despite growing defiance toward the dominant Chinese 5G vendor, documents reviewed by POLITICO show.
- POLITICO: The hole in the Trump administration’s emerging anti-Huawei strategy — Software-based wireless technology can overcome China’s edge in 5G hardware, top U.S. officials hope. But the White House may need to nudge the chipmakers first.