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
- U.S. Stock Futures Edge Up to Start the Week — Prospects for new stimulus bill, tensions with China and the pace of new coronavirus infections are weighing on the stock market.
- Marriott Swings to Loss, Cites Demand Recovery From Covid-19 Lows — The hotel company says 91% of world-wide hotels have reopened, with Greater China leading the recovery.
- Hong Kong’s Security Law Explained — An explanation of why Beijing decided to bypass Hong Kong’s legislature and impose new national-security legislation on the city.
- China Imposes Sanctions on 11 Americans Over Hong Kong — China said it would impose sanctions on 11 U.S. citizens, including Republican Sens. Ted Cruz and Marco Rubio, in retaliation for similar measures by Washington against Hong Kong and mainland Chinese officials on Friday.
- Coronavirus Pandemic Fuels China’s Self-Driving Cars — Autonomous-vehicle road testing has skidded to a halt in the U.S. amid the Covid-19 pandemic. But China’s startups have pushed ahead by more than doubling the number of self-driving car projects, with a boost from the country’s 5G network.
- Tech, Financial Firms Eye Ways to Save TikTok’s U.S. Operations From Ban — Several investment and technology firms are exploring a potential deal for the U.S. operations of TikTok, which is facing a Trump administration ban, but each would have to surmount hurdles at least as high as the Chinese platform’s main suitor, Microsoft.
- Iron Ore’s Price Rally Defies Coronavirus-Induced Recession — Global steel output has fallen during the pandemic, but China’s steps to boost its economy have buoyed local production and with it demand for iron ore.
- Twitter, TikTok Have Held Preliminary Talks About Possible Combination — Twitter has had preliminary talks about a potential combination with TikTok, the popular video-sharing app that the Trump administration has declared a national-security threat due to its Chinese ownership, according to people familiar with the matter.
- Qualcomm Lobbies U.S. to Sell Chips for Huawei 5G Phones — Wading into the technology battle between Washington and Beijing, the smartphone chip maker warns of potentially losing billions of dollars in sales because of export limits.
- U.S. Sanctions Chinese Officials Over Hong Kong Policy—Including Carrie Lam — The U.S. has levied sanctions on a host of senior Chinese officials over Beijing’s Hong Kong policy, including the region’s Beijing-appointed chief executive, Carrie Lam.
- Russia Working to Damage Joe Biden’s White House Bid, U.S. Intelligence Agencies Say — In a public report, a senior counterintelligence official said that China prefers President Trump to lose and that Iran aims to undermine U.S. democracy.
- New Chapter in U.S.-China Ties Marked by Confrontation — The Trump administration’s cascade of actions taken against Beijing represent a new chapter in U.S.-China relations, one marked by increasing confrontation and few efforts to de-escalate the tensions.
- Security Concerns, Anger Over Coronavirus Fuel Trump Moves Against Chinese Apps — President’s concern over national security risks from Chinese social-media companies has been amplified by frustration over the coronavirus and the challenges it poses to his reelection bid, culminating in two executive orders, White House aides and outside advisers say.
- The NBA’s Moral Failure in China — Quick to take up the banner of ‘social justice’ in the U.S., the league turned a blind eye to abuse and neglect at its training academies in Xinjiang.
The Financial Times
- Activists pile in to Next Digital stock following Jimmy Lai’s arrest — Shares in company owned by pro-democracy Hong Kong tycoon jump as much as 344%.
- China’s military takes centre stage in Covid-19 vaccine race — PLA soldiers receive CanSino inoculation as coronavirus accelerates ‘military-civil fusion’.
- Luxshare rises as China’s homegrown iPhone manufacturer — Chinese company poised to reap benefits as Apple localises its supply chain.
- Chinese rating agencies in record boost of local government vehicles — Bond issuers are upgraded as analysts warn of potential wave of defaults.
- US health secretary’s Taiwan trip is sign of strategic shift — Visit highlights island’s growing importance in clash between Washington and Beijing.
- China cleans up in Latin America as US flounders over coronavirus — Beijing’s ‘mask diplomacy’ will boost trade and investment in traditional American zone of influence.
- Chinese smartphone maker Realme takes on emerging Asian markets — Two-year-old brand cracked the world’s top 10 handsets with cheap and relatively high-spec devices.
- Tencent crackdown poses threat to US champions from Apple to Nike — WeChat ban would hurt China but also hit businesses that rely on platform’s popularity.
- Why is Silicon Valley so chilled about the cold war with China? — The Nasdaq has minted new records even as the Trump administration broadens its assault on Chinese tech.
The New York Times
- Hong Kong Arrests Jimmy Lai, Media Mogul, Under National Security Law — The pro-democracy figure is the most high-profile person detained under the sweeping legislation imposed by Beijing on the semiautonomous territory.
- Trump Wants U.S. to Get Cut of Any TikTok Deal. No One Knows How That’d Work. — The president has repeatedly called for a big payment to the Treasury Department if a Chinese company sells the app to Microsoft, but there is no provision in the law for that.
- Trump’s Orders on WeChat and TikTok Are Uncertain. That May Be the Point. — The restrictions on the two Chinese-owned apps followed a familiar model for other policy announcements on China from the Trump administration.
- Is TikTok More of a Parenting Problem Than a Security Threat? — Even as the White House moves against the Chinese social media app, the intelligence agencies do not see it as a major issue along the lines of Huawei.
Caixin
- China’s Consumer Inflation Edges Up Amid Faster-Rising Food Prices — Pork prices rose at a faster clip in July as demand increased and supply was tight due to flooding-related transportation issues.
- Five Major Chinese Banks Clarify Rumors of Pay Cuts — Some financial SOEs are planning 5% pay cuts amid salary reform, Caixin has learned.
- Sunac Joins Trend of Developers Spinning Off Property Management Units — China’s fourth-largest property developer by sales announces plan to list Sunac Service in Hong Kong.
- International Flights Bring Rash of New Infections to Shanghai — China’s commercial capital reported 18 new Covid-19 cases on Sunday, a high not seen since April 11 when 51 infected people arrived in the city.
- China’s Swelling Oil Refining Capacity Adds to Industry Excess — Capacity will likely increase to 1 billion tons by 2025 from 860 million tons in 2019, even as profits plummet.
- Cover Story: TikTok’s Ticking Clock in Trump Faceoff — President’s threat of a ban on ByteDance’s short-video app stokes fears across American political spectrum of Chinese hacking and spying while giving rivals an opportunity.
- China Relaxes High Definition Mapping Regulations To Power Self-Driving Cars — China’s natural resources ministry and state secrets protection administration have released updated rules on state secrets protection in surveying and mapping.
- Huawei Says Supply of Flagship Chipsets to End Under U.S. Sanctions — High-end Mate40 handsets debuting this fall will be the last featuring the Chinese tech giant’s Kirin 9000 processor as TSMC stops making the chips.
- Electric-Car Maker XPeng Files for U.S. IPO — Chinese electric-car maker XPeng Inc. has filed for a U.S. IPO, about a week after hometown rival Li Auto made a strong debut in the U.S. amid strong investor interest in green car firms.
South China Morning Post
- National security law: Hong Kong’s financial institutions gripped by anxiety over United States sanctions — Hong Kong’s financial institutions, from banks and fund managers to brokerages and insurance companies, have been gripped by anxiety and uncertainty since the United States slapped sanctions on key local and mainland Chinese officials over the imposition of the city’s national security law.
- Hongkongers turn to remote Sai Kung islands to relax, raising safety concerns and fears of endangering rare landscape — Nestled in the pristine waters of Hong Kong’s eastern tip are a group of remote islands which have become a magnet for people eager for fresh air and a respite from the Covid-19 pandemic.
- China’s push to boost local chip industry could backfire by creating excess capacity — The Chinese government last week published a long list of incentives to encourage domestic semiconductor development and production, including a maximum 10-year tax holiday for some manufacturers.
- Hong Kong should reform tax code to spur entrepreneurship amid slumps and help city catch up with regional rivals — Hong Kong’s government, owner of one of the world’s largest currency reserves, should consider amending its tax code to let companies transfer losses among units, so that it can maintain the financial centre’s competitiveness with regional rivals, an advisory body said.
- Apple suppliers’ shares plunge in Hong Kong, China as Trump’s WeChat ban is seen pummelling iPhone shipments — Apple suppliers in Hong Kong and China declined on Monday, after analysts predicted Donald Trump’s ban on WeChat could lead to a sharp drop in iPhone shipments, as the American technology giant may have to remove the popular app from its App Store.
- ‘China sympathisers’: a new Red Scare stalks Australian businesses — What Helen Sawczak doesn’t know about doing business with China isn’t worth knowing.
- Microsoft says commitment to Chinese users remains unchanged after updating terms of service — An update from Microsoft at the beginning of this month to its terms of service sparked online speculation in China that it could be preparing to pull out of the country amid rising tech tensions between Beijing and Washington – but the US tech giant has now stepped in to quash the gossip.
- These Chinese autonomous vehicle start-ups are keeping their eye on the driverless road — In the auto industry, the dream of high-level automation free from human intervention is as strong as ever. The concept dates back eight decades to when American industrial designer Norman Bel Geddes demonstrated an electric vehicle manipulated by electromagnetic fields created by placing electronic circuits along a roadway at the 1939 World’s Fair.
- Chinese consumers grapple with ‘flying pigs and rocketing eggs’ as supply disruptions send food inflation soaring — When it comes to buying food for daily meals, Chinese consumers are increasingly being forced to swallow unaffordable prices for two staple products – so-called flying pigs and rocketing eggs.
- Tencent-backed real estate platform Beike aims to raise US$2 billion in New York IPO even as US tightens noose around WeChat — KE Holdings, a Chinese online property platform backed by Tencent Holdings and SoftBank Group, is looking to raise about US$2 billion in a US initial public offering (IPO).
- US-China trade war: Beijing will honour phase one deal by opening financial sector wider, its central bank chief says — China will continue to implement its part of the phase one trade deal with the United States and will fulfil financial opening-up pledges despite worsening bilateral relations between the world’s two largest economies.
- US sanctions bite as Huawei admits ‘big loss’ as supply of high-end Kirin smartphone chips to run out soon — Huawei Technologies’ reign as the world’s No 1 smartphone vendor may be short lived, as the head of its consumer business unit publicly admitted that the company may not be able to ship handsets with its high-end Kirin chips after this year owing to US trade sanctions.
- China inflation rose 2.7 per cent in July, driven by higher food costs — China’s inflation rate rose 2.7 per cent in July, up from the 2.5 per cent gain in June, data released on Monday showed.
Bloomberg
- Inequality Gap Widens in China After Flood Waters Diverted: Green Insight — When the government diverts flood waters to rural areas, it devastates a region.
- China Resumes Tourist Visas to Macau, Lifting Recovery Hopes — China will resume issuing tourist visas for visitors to Macau, paving the way for the mass return of Chinese punters to the world’s largest gaming hub after months of losses.
- China July Consumer Inflation Picks Up Amid Flood Disruption — China consumer inflation accelerated and factory price deflation eased in July, as the nation’s economy continued to recover from the coronavirus crisis amid disruption from regional flooding.
- China Seeks to Drop Rating Requirement for Some Bond Issuers — China’s securities regulator has proposed removing a requirement for bond issuers on the nation’s stock exchange markets to seek credit ratings, in the latest move to make it easier for firms to sell debt.
- U.S. Health Chief Meets Taiwan’s Leader, Fueling China Tensions — On the most senior visit by an American official in more than four decades, Health and Human Services Secretary Alex Azar hailed Taiwan’s democracy and praised President Tsai Ing-wen’s response to the pandemic in comments likely to stoke tensions with China.
- China May Score Its Biggest 5G Win at Home — Even if the U.S. blunts Huawei overseas, China’s domestic 5G network could give it a lock on the factories of the future.
- Chinese Hotpot Ingredients Supplier Guoquan Is Said to Weigh IPO — Chinese hotpot ingredients supplier Guoquan is weighing an initial public offering as soon as next year, according to people with knowledge of the matter.
- Hong Kong Bankers Move to Suspend Accounts on U.S. Sanctions — Banks operating in Hong Kong are stepping up scrutiny of their customers and at least one U.S. bank is moving to suspend accounts to avoid running afoul of U.S. sanctions slapped on city officials, putting them at risk of violating the controversial security law imposed by China.
- Tencent Shares Lose $66 Billion in 2-Day Rout on WeChat Ban — Tencent Holdings Ltd. added to Friday’s sharp decline to start the week, putting the stock’s two-day loss of market value at $66 billion following America’s move to ban residents from doing business with the company’s WeChat app.
- New Oriental Is Said to Pick Banks for Hong Kong Second Listing — Chinese private school operator New Oriental Education & Technology Group Inc. has chosen three banks for a planned second listing in Hong Kong that could raise at least $1 billion, according to people familiar with the matter.
- Asia Tech-Shares Selloff Seen as Buy Opportunity for Some Funds — Friday’s attack by President Donald Trump on WeChat may have pushed many investors to offload Asia’s technology shares. But for some, the selloff has presented a good buying opportunity.
- Hong Kong Crisis Deals $7.7 Billion Blow to Property Tycoons — CK Asset, Wharf, Sun Hung Kai have all been affected, and prime office rents may drop 15% to 20% in 2020, an analyst says.
- China’s Aiko Solar Will Spend $2.87B to Build Plants in Zhejiang — Shanghai Aiko Solar Energy Co. will invest 20 billion yuan ($2.87 billion) to build photovoltaic cell manufacturing plants in Zhejiang province, according to an agreement between the company and the local government.
- China’s Government Could Thwart Rise of Chinese Tech Companies — The government’s actions could deny Chinese companies the benefits of competing globally.
- TikTok to Sue Trump Administration as Soon as Tuesday, NPR Says — TikTok plans to file a federal lawsuit as soon as Tuesday to challenge President Donald Trump’s executive order banning the video-sharing service from the U.S. as unconstitutional, National Public Radio reported.
- China Securities Regulator Sends New Proposal on U.S. Audits — China’s securities regulator said it has sent U.S. authorities a fresh proposal about co-auditing Chinese firms, days after Washington moved to tighten rules for stock listings from the Asian nation.
- Trump’s TikTok, WeChat Ban Is Facebook, Google’s Problem, Too — The president’s move to outlaw the Chinese apps may invite retaliation and have negative ramifications for companies such as Apple and Facebook.
- China Dominates Bid for Africa’s Largest Dam in New Pact — Chinese and Spanish developers that want to build Africa’s biggest hydropower plant in the Democratic Republic of Congo agreed to form a single consortium in an accord the country says is a key step to realizing the plan.
- China to Expand Policy Support for Exporters, Xinhua Says — China’s Ministry of Commerce will expand policy support for exporters as the global environment in the second half remains challenging for such companies, Xinhua reported.
- SoftBank-Backed Beike Seeks About $2 Billion in U.S. IPO — KE Holdings Inc., a Chinese online property platform backed by Tencent Holdings Ltd. and SoftBank Group Corp., is looking to raise about $2 billion in a U.S. initial public offering.
- China and Argentina Resume Joint Venture for Space Exploration — China and Argentina have resumed plans to work together on outer space exploration in a sign of the Asian nation’s growing influence in the administration of President Alberto Fernandez.
Reuters
- Shares edge up as positive China industrial data outweighs trade jitters — Share markets rose on Monday as stronger industrial activity in China offered signs it was recovering from the coronavirus pandemic that outweighed jitters over U.S.-Sino trade tensions.
- Huawei to stop making flagship chipsets as U.S. pressure bites, Chinese media say — (This Aug 8 story corrects second graf which erroneously stated Yu made remarks at the launch of new P40 device.)
- Explainer: Microsoft’s TikTok bid spotlights Windows maker’s history with China — Microsoft Corp has emerged as the most likely buyer of the U.S. operations of TikTok, the popular Chinese short-video app that U.S. President Donald Trump is preparing to effectively ban on national security grounds.
- ByteDance takes step toward entering online stock broking in Hong Kong — Beijing-based ByteDance, the owner of global short video hit TikTok, is taking steps to move into the online stock brokerage and wealth management business in Hong Kong, trademark registration documents show.
- China ex-regulator warns on bank funding risk as NCD issues boom — The former head of China’s securities regulator has raised concern about banks addressing funding shortages by ramping up issues of short-term interbank debt instruments that have in the past attracted regulatory scrutiny.
- China bank failure fires quiet warning shot — Beijing will let Baoshang Bank go under in the first such insolvency since 2001 – a quiet warning shot fired at Chinese financial markets. The liquidation of the municipal lender, used as a piggy bank by an insurer, will raise borrowing costs for small peers and possibly push more of them to the brink. With the economy still wobbling, it’s a risky time to cleanse the system.
- Fuelled by Volvo, China’s Geely seeks launchpad to enter auto giant orbit — Chinese carmaker Geely plans to use a platform developed with input from Volvo to build new models in Malaysia for its partly owned Proton brand, a strategy that shows how it aims to accelerate its push to become China’s first global auto giant.
- ‘Like gold’: Canadian canola prices spike as shippers find back door to China — Canadian canola prices have soared to the highest in nearly two years, despite a diplomatic dispute between Ottawa and Beijing, as exporters find roundabout ways to reach top oilseed buyer China.
- Trump advisers urge delisting of U.S.-listed Chinese firms that fail to meet audit standards — China on Saturday called for frank dialogue and closer cooperation in reaction to news that Trump administration officials had urged the U.S. president to delist Chinese companies that trade on U.S. exchanges and fail to meet its auditing requirements by January 2022.
- HK markets watchdog says it does not think sanctions will affect financial firms — Hong Kong’s markets watchdog is not aware of any aspect of U.S. sanctions imposed on Hong Kong officials that will affect how financial firms carry on their normal operations in the city, a spokesman said on Saturday.
- Tencent-backed Chinese realty company KE Holdings eyes $2 billion U.S. IPO — KE Holdings Inc, a China-based real estate services provider backed by Tencent , said on Friday it will aim to raise up to $2 billion in its U.S. initial public offering.
Xinhua
- Chinese shares close higher Monday — Chinese stocks closed higher Monday, with the benchmark Shanghai Composite Index up 0.75 percent at 3,379.25 points.
- Chinese real estate giant KE Holdings to make NYSE debut — KE Holdings Inc., a leading real estate services provider in China, has filed for an initial public offering (IPO) on the U.S. stock market.
- China’s consumer inflation rises to 2.7 pct in July — China’s consumer inflation accelerated for the second straight month in July on the back of higher food prices, official data showed Monday.
- China’s central bank injects 10 bln yuan into market — China’s central bank Friday pumped cash into the banking system via reverse repos to maintain liquidity.
- China’s warehouse storage sector continued recovery in July — China’s warehouse storage sector continued to edge up in July amid gradual recovery in market demand, industry data showed.
- China’s textile companies see lower revenues in H1 — China’s major textile companies reported lower revenues and profits in the first half of this year, official data showed.
- NW China’s Gansu exports olive oil to ROK — A total of 1.2 tonnes of olive oil produced in northwest China’s Gansu Province was exported to the Republic of Korea (ROK), local customs said Sunday.
- China’s used car sales rise in June — China’s used car sales climbed 4.41 percent month on month in June, according to a report by the China Automobile Dealers Association.
- Great Wall Motor car production, sales up in July — Great Wall Motor Co. Ltd., China’s largest sport utility vehicle (SUV) and pickup manufacturer, on Sunday reported rise in production and sales in July.
- Property giant Evergrande reports rising sales in July — China Evergrande Group, one of the leading developers in China, reported surging sales last month, the company said in a statement.
- Chinese real estate giant KE Holdings to make NYSE debut — KE Holdings Inc., a leading real estate services provider in China, has filed for an initial public offering (IPO) on the U.S. stock market.
- China’s rare earth price index up — The China Rare Earth Price Index went up 0.82 percent from the previous working day to 1,262.44 points Monday.
- China’s interbank treasury bond index closes higher — China’s interbank treasury bond index in net price closed 0.01 percent higher at 985.14 points Monday, according to the China Foreign Exchange Trade System.
- Tianjin Bulk Freight Index up 1.19 pct — The China Tianjin Bulk Freight Index (TBI), an indicator of northern China’s international bulk freight rates, stood at 835.07 points Monday, up 1.19 percent compared with the previous working day.
Other Publications
- Forbes: Plummeting Renewable Energy, Battery Prices Mean China Could Hit 62% Clean Power And Cut Costs 11% By 2030 — China is the world’s largest greenhouse gas emitter, and is building the most power plants of any country in the world, making its decarbonization paramount to preventing dangerous climate change. But the costs of wind, solar, and energy storage have fallen so fast that building clean power is now cheaper than building fossil fuels – a lot cheaper.
- Forbes: China Cancer Diagnostics Firm Genetron’s Revenue Gains After IPO — Shares in Genetron Holdings ended last week lower after the Beijing-headquartered cancer diagnostics and monitoring company posted its first earnings report following a U.S. IPO that raised $235 million in June.
- Nikkei Asian Review: VW extends China market lead with new low-cost brand Jetta — While most carmakers are struggling to get consumers into showrooms and opening their wallets amid worries from the coronavirus pandemic, Germany’s Volkswagen has managed in recent months to extend its lead as China’s top auto seller.
