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
- Jack Ma’s Ant Group Plans Dual IPOs in Shanghai, Hong Kong, Bypassing New York — Ant Group, the Chinese technology and financial-services giant that owns popular mobile-payments network Alipay, said it is planning initial public offerings in Hong Kong and Shanghai, bypassing New York as it seeks to accelerate its growth in China and abroad.
- Tesla Is a Hit in China but That Doesn’t Mean Chinese EV Stocks Are a Buy — Chinese EV stocks are surging—but demand for clean-energy vehicles isn’t.
- Bringing the Factories Home — Any new industrial policy has to make the U.S. less vulnerable to Chinese suppliers.
- A Trump Retreat From Korea? — A good way to look weak on China and help Biden get to his right on national security.
- The Iran-China Axis — A demonstration that regional authoritarian powers don’t tend to stay in their region.
- Chinese Regulators Take Over Nine Financial Institutions, Citing Risks — Chinese financial regulators took over nine financial institutions they said broke rules and added risk to a financial system facing increasing headwinds from the coronavirus pandemic.
- As Huawei Retreats in Europe, Ericsson Expands in China — Washington’s war on Huawei eventually seems bound to help the Chinese giant’s leading Western rival, Ericsson. But it hasn’t yet, leaving the Swedish company dependent for 5G-equipment sales on—of all places—China.
The Financial Times
- Mexico’s pick to run WTO vows to ease US-China trade tensions — Jesús Seade’s experience for top job includes locking horns with Washington over North American pact.
- Brave Hong Kongers deserve better from investors — UN should also be doing more to protect human rights.
- Europe and US can still compete with Chinese tech — The first step should be easy: create a transatlantic technology detente.
- Vanguard venture with Ant Group lures 200,000 Chinese clients — Pennsylvania-based asset manager plans to multiply customers by offering low-cost financial advice.
The New York Times
- China Is Using Uighur Labor to Produce Face Masks — A Times video investigation identified Chinese companies using a contentious labor program for Uighurs to satisfy demand for P.P.E., some of which ended up in the United States and other countries.
- China Is Dismantling the Empire of a Vanished Tycoon — Three years after Xiao Jianhua was snatched from a luxury hotel in Hong Kong, Beijing is making it clear that his style of freewheeling finance is a thing of the past.
Caixin
- China Moves to Unify Fragmented $15.4 Trillion Bond Market — ‘Connect’ mechanism will link market infrastructure to provide a one-stop shop.
- China Banking Watchdog to Levy Biggest Banking Fines in Years — Two banks will each be fined more than 100 million yuan in a sign CBIRC is getting tough on rule breakers.
- Bank of Beijing Banned From Bond Underwriting for Kangde Xin Link — Six-month suspension imposed by industry self-regulatory group is punishment for bank’s role in helping a chronic defaulter sell short-term notes.
- In Depth: Will China’s Bull Market Be Short-Lived? — Bubble debate comes to a boil as equity markets return to levels not seen since the 2015 crash, fueled by ample liquidity, increased margin trading and recovery for long-undervalued sectors.
- UBS, JPMorgan Fuel Biggest Chinese Battery-Maker’s $2.8 Billion Fundraiser — Nine investors stump up winning bids for CATL, which will plow the proceeds into R&D and capacity expansion.
- Apple Supplier TSMC Invited by Japan to Build Joint Chip Plant: Report — Japan is looking to invite Apple supplier Taiwan Semiconductor Manufacturing Co. Ltd. (TSMC) and other global chipmakers to build an advanced manufacturing plant alongside domestic chip equipment suppliers in the hope of capitalizing on their technologies to bolster its chip industry, according to a report by Yomiuri Daily on Sunday.
- Alibaba-Backed AutoX Wins Permit to Test Fully Driverless Car in California — AutoX has obtained a permit from the California Department of Motor Vehicles (DMV) to test a self-driving vehicle without a human driver behind the wheel, becoming the first Chinese company to receive such a driverless testing permit in the U.S. state.
South China Morning Post
- Taipei threatens permit payback after Taiwan officials forced to leave Hong Kong over one-China principle — Taiwanese authorities may not renew work permits for Hong Kong officials on the island in retaliation for a similar treatment by the Hong Kong government, amid souring relations following the introduction of a national security law in Hong Kong which targets both Hong Kong and Taiwanese groups and people.
- China’s cinemas reopen as Covid-19 rules are eased – but distancing applies and popcorn is banned — Cinemas in most areas of China were reopening from Monday after being closed for nearly six months because of the coronavirus, as various measures were relaxed with the domestic outbreak largely under control.
- Hong Kong women’s pursuit of career goals more important than ever amid coronavirus — As the coronavirus outbreak continues into its sixth month in Hong Kong, upending work and home lives, the pursuit of career goals has become even more challenging for women.
- Coronavirus: Hong Kong unemployment rate rises to 6.2 per cent, highest in more than 15 years — Hong Kong’s unemployment rate has climbed to its highest level in more than 15 years, hitting 6.2 per cent, while a fresh wave of coronavirus infections could plunge the embattled economy further into recession.
- US Autonomy Act unlikely to undermine Hong Kong dollar peg in short-run, but poses long-term risk, analysts say — US President Donald Trump’s decision to take action against Beijing over its imposition of a new security law on Hong Kong is unlikely to undermine the city’s dollar peg system or its role as a financial hub in the short term, but escalating conflict between the US and China raises questions about the long-term outlook, according to analysts.
- Hong Kong textile giant Esquel, supplier of Nike and Hilfiger, suspends operations at spinning mill as new coronavirus cases spark lockdown of Xinjiang’s capital — Esquel, one of the world’s largest cotton shirt makers, says it will close a mill in Urumqi as the city of 3.5 million people in western China shuts down amid the return of coronavirus.
- Belt and Road Initiative debt: how big is it and what’s next? — Chinese investments in developing countries have raised questions about whether such projects can ever generate enough money to pay off the debt. Beijing will participate in the G20’s Debt Service Suspension Initiative, which offers relief for 77 developing nations’ debt repayments this year – on a case-by-case basis.
- Australia beef exports ‘rescued’ after China ban by demand from US, South Korea — A slump in US beef production in May as a result of the coronavirus pandemic has “rescued” Australian beef exports hurt by a Chinese ban on four of its abattoirs, export data shows, though new demand is unlikely to last long term.
- China keeps loan rate steady for third straight month with ‘inaction not surprising’ as economy improves — China kept its benchmark lending rate steady for the third straight month on Monday, matching market expectations, amid signs that the world’s second-largest economy is recovering from the shock coronavirus pandemic.
Bloomberg
- Nestle Said to Narrow Bidders for Yinlu Foods Unit in China — Nestle SA has narrowed the list of bidders for its Chinese unit Yinlu Foods Group, which could fetch at least $400 million, according to people with knowledge of the matter.
- China’s Cooling Oil Demand Has Asian Physical Prices Sliding — The price of physical oil barrels traded in Asia has slipped after Chinese demand cooled following a record purchasing spree.
- OPEC Has New Competitor as China Ships Oil From Swelling Storage — Some oil from China’s swelling storage tanks is finding its way back into the international market as traders jump at the opportunity to source cheap crude for resale to regional refiners.
- Ant Group Is Said to Pick Banks for $10 Billion Hong Kong IPO — Ant Group, the parent of China’s largest mobile payment company, has picked China International Capital Corp., Citigroup Inc., JPMorgan Chase & Co. and Morgan Stanley for its Hong Kong initial public offering, according to people familiar with the matter.
- China Hedge Fund Tapping Quant Demand Eyes $1 Billion in Assets — A Chinese hedge fund using artificial intelligence to invest in the nation’s stock market expects to exceed $1 billion in assets on growing demand for quantitative investment strategies.
- Japan Starts Paying Firms to Cut Reliance on Chinese Factories — Japan’s government will start subsidizing some companies to invest in factories in Japan and South-East Asia as part of efforts to reduce reliance on manufacturing in China.
- Xpeng Raises $500 Million Even as China EV Market Sputters — Electric-vehicle maker Xpeng Motors raised about $500 million from a group of venture investors, showing Chinese startups with promising car models can attract funding even as the industry’s sales slump.
- BlackRock Shifts Money From China in Wake of Stocks Rally — The world’s biggest money manager is joining a wave of global investors taking profits in Chinese equities after a historic rally, and plans to shift some of the funds to emerging markets that are in a more nascent stage of recovery.
- China’s Chipmaker Mania Grows Alongside U.S. Tensions — Chinese chipmakers have surged in the past year, boosted by Beijing’s support for self-sufficiency in semiconductors and as adoption of 5G and artificial intelligence prove resilient amid the pandemic. There’s no sign that rally is about to slow even as their stocks looks increasingly expensive.
- Hong Kong Shutdown Weighs on Property Developer Stocks, Casinos — Hong Kong stocks fluctuated after a record number of new coronavirus cases in the city prompted the government to extend social-distancing measures.
- Standard Chartered to Add 1,600 Staff at New China Bank Center — Standard Chartered Plc plans to add more than 1,600 staff over the next three years at a new center in southern China as the nation aims to transform the coastal region near Hong Kong into a high-tech hub to rival California’s Silicon Valley.
- Ayala’s Energy Unit Eyes 140-Megawatt Peak Solar Farm in India — AC Energy Inc. is making its first major investment in India by developing the $68 million Sitara solar plant through a joint venture with UPC Renewables China Holdings Ltd.
- China’s Small Lenders Are Filling Up on Riskiest Bank Debt — China’s cash-strapped small lenders are expanding their pile of the riskiest kind of bank debt to shore up their capital levels, bracing against an economic slowdown and rising loan defaults.
- China Integrates Trading of $14 Trillion Local Bond Markets — China took a further step in integrating its fragmented bond markets, a move which analysts say could reduce complexity and attract foreign investors.
- China Probes Brokerages for Low-Price Bids in Bond Underwriting — Several Chinese securities brokerages including Guotai Junan Securities Co. were under investigation of an industry association for allegedly making unusually low bids to underwrite CNNC Financial Leasing Co.’s bonds.
- China’s TikTok Halts Plans for Global Base in U.K., Times Says — TikTok suspended talks to build a global headquarters in the U.K., and Communist Party officials in Beijing have warned British companies doing business in China they’re set to face retaliation over the government’s decision to stop working with Huawei Technologies Co., the Sunday Times reported.
- Thailand Forges New Path for Food Exports to China Amid Pandemic — Thailand is turning to a less-traveled path to bypass supply-chain roadblocks and deliver perishables to China, its biggest customer in Asia.
- Trump Campaign Urges Supporters to Back TikTok Ban in Online Ads — Donald Trump’s presidential campaign is paying for ads on Facebook Inc.’s social media platforms urging supporters to sign a petition banning Bytedance Ltd.’s TikTok, as the White House ramps up rhetoric to restrict the video app in the U.S.
- China’s Cosmetics Brands Gain Patriotic Allure Amid Covid — The country’s cosmetic makers are challenging foreign rivals, helped by patriotic buying and a shift to online commerce.
- Hong Kong’s Yawning Wealth Gap Grows Wider Amid Pandemic — Hong Kong is emerging as a case study of how the coronavirus pandemic is affecting vulnerable members of society, as tens of thousands have been thrown out of work with little social safety net to support them in one of the world’s most unequal and expensive cities.
Reuters
- Starbucks expands Chinese order services to multiple Alibaba apps — Chinese Starbucks customers can order the coffee chain’s drinks on Alibaba’s Taobao marketplace and mobile map apps, Reuters checks showed, in a sign the two companies may be expanding a partnership signed in 2018.
- Johnson says Britain will be tough with China over new Hong Kong security law — Britain will on Monday suspend its extradition treaty with Hong Kong in an escalation of its dispute with China over its introduction of a national security law for the former British colony, newspapers reported.
- UK will announce changes to extradition arrangements with China, says PM Johnson — Britain is to announce changes to its extradition arrangements with China and Hong Kong on Monday, Prime Minister Boris Johnson said, citing concerns over new national security laws imposed on the former British colony by Beijing.
- Cinemas in China begin to reopen after six-month coronavirus closure — Some cinemas in Chinese cities from Shanghai to Chengdu reopened on Monday after a six-month closure, raising hope that the world’s second largest movie market can start to recover from painful losses during the coronavirus pandemic.
- BP puts crude oil traders on leave pending investigations into China dealings — BP has put four traders responsible for Chinese crude oil sales on temporary leave as it conducts internal investigations into trades with Singapore’s Hontop Energy, four sources familiar with the matter said.
- Tomorrow Group-linked shares tumble after China seizes affiliated financial firms — Shares in three companies with connections to troubled Chinese conglomerate Tomorrow Holdings Co Ltd slumped on Monday after regulators seized control of nine firms affiliated with the group.
- Breakingviews – Huawei might starve overseas before it sells — Founder Ren Zhengfei has mulled divesting intellectual property, but overseas buyers for that, or for handset or network units, are few. Nor will Beijing permit a sale that looks like defeat.
- UK’s Raab says clear Uighurs in China suffered human rights abuses — British Foreign Secretary Dominic Raab said on Sunday it was clear the Uighur minority in China had suffered abuses of their human rights.
- China to connect interbank and exchange bond markets – central bank — China will connect its interbank and exchange bond markets, the People’s Bank of China said on Sunday, a move aimed at unifying segregated bond markets and facilitating monetary policy transmission and macro economic management.
- China raises equity investment cap for insurers to 45% — China’s banking and insurance regulator said it was raising the cap on how much the country’s insurers can invest in equity assets, an effort trying to bring more long-term funds into the capital market.
- China regulator encourages brokerages, mutual funds to merge, media says — China’s top securities regulator is encouraging mergers and acquisitions among brokerages and mutual fund houses, the state-run China Securities Journal reported on Saturday.
- Foreign ministers of China, Russia oppose “U.S. unilateralism” in phone call: Xinhua — The foreign ministers of China and Russia held a telephone conversation on Friday, in which they opposed “U.S. unilateralism”, China’s state news agency Xinhua reported.
- U.S. sanctions four China-based individuals, firm over fentanyl — The United States on Friday announced sanctions against four China-based individuals and one company run by alleged Chinese drug kingpin Fujing Zheng for links to trafficking in fentanyl.
Xinhua
- ICBC sees steady DFI underwriting business growth in H1 — The Industrial and Commercial Bank of China (ICBC), the country’s biggest commercial lender, saw its business of debt financing instruments (DFI) underwriting expand steadily in the first six months amid efforts to support COVID-19 prevention and control.
- Index shows China new growth drivers thrive — New development drivers are increasingly underpinning China’s growth, with the internet-based industries adding to economic vitality, an index showed.
- New regulation to ensure timely payments to SMEs, improve business environment: officials — China’s State Council has recently released a regulation on ensuring timely payments to small and medium-sized enterprises (SMEs), which will help improve the business environment, officials said.
- CDB issues 705-bln-yuan loans to energy, transport sectors in H1 — China Development Bank (CDB), one of the country’s major policy banks, said it had issued loans to the tune of 705.3 billion yuan (about 100.7 billion U.S. dollars) in the first half of the year to support the country’s energy and transport sectors.
- China Development Bank offers financing support to Greater Bay Area — The China Development Bank (CDB), one of the country’s major policy banks, provided 200.2 billion yuan (about 28.61 billion U.S. dollars) in financial support to the Guangdong-Hong Kong-Macao Greater Bay Area in the first half of 2020.
- Digital coupons benefit over 10 mln small businesses across China: report — A digital coupon initiative, launched by Alipay on July 1, has attracted the participation of over 10 million small and micro-businesses across China, the platform said in a report.
- Sci-tech firms raise 200 bln yuan on STAR market — China’s Nasdaq-style sci-tech innovation board, also known as the STAR market, saw a rapid expansion of listed companies in scientific and technological sectors including semiconductors and intelligent manufacturing, Economic Information Daily reported Monday.
- China invests heavily to quicken hog production recovery — China’s top economic planner has allocated 4.55 billion yuan (649.6 million U.S. dollars) from the central budget to help pig farms improve facilities, and accelerate the recovery of the country’s hog production.
- China’s cargo transport back to normal growth — China’s cargo transport industry reported faster growth in June with business activities recovering to normal levels, industry data showed.
- Hainan’s actual use of foreign investment doubles in H1 — Driven by the policy of a free trade port, the actual use of foreign investment in China’s southern island province of Hainan continues to grow rapidly, statistics show.
- China’s Hunan sees rising foreign trade in H1 — Central China’s Hunan Province saw its foreign trade rise 13.4 percent year on year to over 208 billion yuan (about 29.7 billion U.S. dollars) in the first half of this year, local customs said Friday.
- New Zealand dairy giant Fonterra to further investment in China — New Zealand dairy giant Fonterra Co-operative Group is looking forward to its business prospect in China as the company is to further its investment in the country, said its chief executive Miles Hurrell on Monday at the sixth China Business Summit in Auckland.
- China Life Insurance reports premium income growth in H1 — China Life Insurance Co., one of the country’s biggest insurers, posted premium income growth in the first half of 2020.
- China’s SOEs help ease company burden by cutting fees of 120 bln yuan in H1 — China’s centrally-administered state-owned enterprises (SOEs) have cut prices and fees in the first half of the year, thus helping ease operational cost for the virus-hit economy by over 120 billion yuan (about 17.14 billion U.S. dollars), according to the country’s state-asset regulator.
Other Publications
- Axios: Hawley to squeeze corporate America on forced labor — Sen. Josh Hawley (R-Mo.) tells Axios he’ll introduce legislation this week requiring companies with business overseas to certify that their supply chains are free of forced labor — and he’s especially concerned about China.
- Business Insider: China’s Hunger For Crude Is Waning — As the coronavirus epidemic brought the world’s second-largest economy to a near-halt during the early part of the year, Chinese crude importers engaged in a massive buying spree, but now the Chinese bounty appears to be evaporating, and the bulls have been put on high alert by the weakening of a key oil price catalyst.
- Forbes: Broadway Marketers Fear TikTok Ban — If the government chooses to block TikTok in the United States, then it would close one of the most effective avenues for Broadway shows to reach new audiences. “TikTok is fantastic for theatre,” commented Jim Glaub.
