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  • Apple has begun designing face shields to protect health care workers during pandemic, Tim Cook says

    Apple is designing and producing face shields to protect health care workers in the United States throughout the coronavirus pandemic, CEO Tim Cook said in a video posted on Twitter on Sunday.The tech giant is also increasing the number of face masks it’s donating to 20 million, double the amount it had previously committed to providing.The first of Apple’s newly developed face shields were delivered to Kaiser Permanente hospital facilities located in California’s Santa Clara Valley this past…

    Posted: by South China Morning Post

  • City’s new plan to lure investment

    Shanghai has rolled out an innovative investment promotion platform for investors designed to help them make the right choices in the city.The platform (http://investment.sheitc.sh.gov.cn/) was created by the Shanghai Commission of Economy and Informatization, along with several other government authorities, industrial parks and business complexes.The platform is like an investment encyclopedia of Shanghai and a merger of all industry resources, the commission said in announcing the move.“Unlike commercial counterparts whose ranking was based on bidding, this investment promotion platform, built and operated by the government, provides objective information,” said Wang Dong, director of the Shanghai Investment Promotion Service Center.

    Posted: by Shanghai Daily

  • Coronavirus pandemic likely to permanently change dining habits of Asian consumers, Nielsen study says

    Asian consumers are unlikely to go back to their old habits of frequently dining out, and will instead prefer takeaways and eating at home once life goes back to normal after the Covid-19 pandemic, according to a study.“Consumer across Asia have signalled their eating habits may change permanently once the world moves beyond the impact of the novel coronavirus,” an online survey by market researcher Nielsen found. Over 6,000 respondents in 11 markets – China, Hong Kong, Taiwan, Japan, South…

    Posted: by South China Morning Post

  • Hong Kong and Shenzhen firms join global effort to meet demand for coronavirus test kits

    As demand for Covid-19 test kits surges globally, three diagnostic companies in Hong Kong and neighbouring Shenzhen sprang into action to help contain the worst public health crisis in a generation.“We are seeing huge demand for our extraction kits, with order requests in the range of 10,000 to 100,000 units,” Ricky Chiu Yin-to, the chairman of Hong Kong-based Phase Scientific International, said in an interview. “We will be delivering [the kits] in the next couple of weeks.”The company last…

    Posted: by South China Morning Post

  • How the pandemic is hitting the reset button on the world economy and international cooperation

    Last September, business leaders and academics across Europe and the US began calling for a reset: the need for businesses to act more sustainably, to treat their stakeholders more equitably, and global warming seriously. They were focusing on ESG – “environmental, social and governance” – factors.Six months later, as an unforeseen global pandemic sweeps grimly across the globe, the calls for a reset have become more urgent than ever. But the reset is also being redefined. And the global…

    Posted: by South China Morning Post

  • Luckin Coffee apologizes over faked sales figures

    LUCKIN Coffee, China’s biggest rival to Starbucks, apologized yesterday after it revealed a top executive may have faked 2.2 billion yuan (US$310 million) worth of sales in 2019.

    The company’s former chief operating officer Liu Jian and several of his staff have been suspended pending an internal investigation, it said in a US Securities and Exchange Commission filing last week.

    “The company retains the right to take legal measures against those suspected to be involved. It will not shield them or be lenient,” Luckin Coffee said in a statement on Weibo yesterday.

    Luckin Coffee added that its stores would remain open as usual, and acknowledged that it relied on the support of its customers.

    The company said in its filing that fabricated sales extended from the second to the fourth quarter last year, making up almost half of its estimated 2019 revenue of US$732 million.

    Luckin Coffee has not released its fourth-quarter results. After the bombshell on Thursday, shares in the NASDAQ-listed firm plunged over 70 percent to close at 6.4 dollars apiece.

    China’s securities regulator said it pays close attention to and strongly condemns accounting fraud.

    A listed company, no matter where it is listed, must strictly abide by the laws and norms of the relevant market and perform its obligation of information disclosure truthfully, accurately and completely, the China Securities Regulatory Commission said in an online statement.

    The CSRC will resolutely crack down on securities fraud and effectively protect the rights and interests of investors, it said.

    Launched in 2017, the Chinese coffee chain made a remarkable debut on Wall Street in May 2019, raising US$561 million during its IPO. Shares soared more than 50 percent during initial trading.

    The start-up had aimed to dethrone Starbucks in China by pursuing an aggressive growth strategy, enticing customers with an app-based purchasing model which prioritized takeaway and deliveries, and generous mobile coupons.

    By the end of 2019, the Xiamen-based chain’s 4,500 outlets on the Chinese mainland had already surpassed Starbucks’ 4,300 stores.

    Posted: by Shanghai Daily

  • PBOC cuts RRR in bid to stimulate economy

    CHINA’S central bank on Friday announced a decision to cut the reserve requirement ratio for small and medium-sized banks by 100 basis points in its latest effort to bolster the real economy amid the novel coronavirus outbreak.

    The RRR cuts will be implemented in two phases, with the first of 50 basis-point reductions expected on April 15.

    The second, also 50 basis points, will be effective on May 15, said the People’s Bank of China.

    The reduction in the cash that lenders must hold as reserves is expected to unleash around 400 billion yuan (US$56.3 billion) of long-term capital into the market, the PBOC said.

    The cuts are expected to inject liquidity into around 4,000 small and medium-sized lenders including rural cooperatives, rural commercial banks and city commercial banks operating only within provincial administrative areas, adding sources of stable financing for the country’s small and medium-sized enterprises.

    Better use of capital

    After the cuts, the RRR for the country’s small and medium-sized lenders will be slashed to 6 percent, a relatively low level compared with the ratio in other developing countries and past rates in China.

    The PBOC will also cut the interest rate on excess reserves for financial institutions from 0.72 percent to 0.35 percent from tomorrow, the first cut since 2008.

    The move will push banks to enhance their capital use efficiency and help them better serve the real economy, especially SMEs.

    Friday’s decision marked the third RRR cuts the central bank has announced this year to shore up the economy, which was under significant downward pressure as a result of the novel coronavirus disease.

    The previous cuts, announced on January 1 and March 13, released a total of 1.35 trillion yuan of liquidity into the market.

    The high frequency of RRR cuts marked continued government efforts in counter-cyclical adjustments, while at the same time reflecting the urgency in driving economic recovery amid epidemic control, said Wen Bin, chief researcher with China Minsheng Bank, in a research note.

    China has been resorting to a package of monetary and fiscal policies to support the country’s SMEs, which were hardest hit by COVID-19.

    Posted: by Shanghai Daily

  • Resilient Shanghai stocks: a safe haven?

    Shanghai stocks, led by health care-related shares, have weathered the COVID-19 pandemic better than expected — a performance largely credited to the government’s rapid response to the outbreak.To be sure, there have been hiccups. The benchmark Shanghai Composite Index, which covers both Class A and B shares, posted a 4.5 percent decline for March, though it gained almost 1 percent in the last five trading days of the month.By comparison, New York’s Dow Jones Index tumbled 13.7 percent in March, the Nikkei in Japan fell 10.5 percent, and Hong Kong’s Hang Seng slid 9.7 percent.Even in China, the Shanghai markets outperformed sister bourses. The Shenzhen Component Index lost 9.3 percent in March, and the Nasdaq-style ChiNext Composite Index retreated 9.6 percent. Year to date, the Shanghai index has dropped only 9.1 percent, compared with declines of between 20 percent and 30 percent in US, Japanese, German and French stock markets. So are Shanghai’s Class A shares the global “safe haven” that some have touted?“Whether A-shares can continue to be relatively independent of overseas markets in the future and truly become a safe haven for foreign investors depends on the performance of China’s economic fundamentals,” said Zhu Qibing, chief macro-economist at BOC International China.China has been lauded for its quick and effective anti-epidemic response. Economic measures have been implemented to provide ample wiggle room for policymaking, Zhu said, and the economy has greater scope to maneuver in dealing with external shocks. “All these decisions highlight the resilience of the country’s economic growth and can help unleash the potential of A-shares,” he added.It comes as no surprise that Chinese companies involved in health-care industries have fared the best during the coronavirus crisis. As a sector, they are up 18.1 percent this year. Zhejiang Orient Gene Biotech Co surged 212 percent on Shanghai’s STAR Market this year, while Shenzhen-listed Intco Medical Technology Co soared 170 percent.Trailing not far behind are companies related to farming, forestry, animal husbandry and fishing — up by nearly 13 percent. Heilongjiang Agriculture Co jumped by 57.7 percent, and New Hope Liuhe Co, an animal feed company, advanced 56 percent. Not all sectors have been so fortunate. With travel restricted, the sub-index for aviation stocks has plummeted 21.6 percent since the beginning of the year. Juneyao Airlines Co has fallen 34.4 percent, while Air China shares declined 30.8 percent. Insurers, including China Pacific Insurance Group Co and China Life Insurance Co, have slumped 20.5 percent as a group. The banking sector, including PingAn Bank and Bank of Ningbo, has lost about 16 percent.On an individual company basis, the best two performing stocks this year are Starpower Semiconductor and Fuzhou Rockchip Electronics Co, up 903 percent and 493.8 percent, respectively. The worst performing duo are Jiangsu Boxin Investing & Holdings Co and Beijing Xinwei Technology Group, which was the subject of negative press stories last year. Many individual investors, already stung by the lifestyle changes wrought by the virus, are wary about investing in stocks.Zhu Yao, 47, said he sold half his stock portfolio and transferred his assets to more stable investments like gold and bonds. Min Yazhou, a 29-year-old entrepreneur, isn’t quite so pessimistic. He said there are buying opportunities amid the crisis, particularly in undervalued stocks with development potential, such as companies related to new infrastructure.Yang Liu, an analyst with Minsheng Securities, said the short-term effects of COVID-19 have boosted demand for household necessities and home entertainment, while hitting offline retailers and manufacturing.She predicted infrastructure development companies may benefit in coming months from government policy support, while industrial chain globalization and export-oriented industries are likely to suffer.Yang cited the case of consumer electronics and semiconductors, sectors related to industrial chain globalization. Companies in that realm face risks of upstream supply chain shortages and weak global demand in the next two quarters, she said.CITIC Securities is predicting that the A-share market will likely bottom out this month.“China had led other countries in controlling the epidemic, and China’s economic activity is likely to take the lead in the recovery, with growth mainly driven by domestic demand,” said Qin Peijing, chief strategist of CITIC Securities.“Chinese stocks and fixed-income assets,” he noted, “will become more attractive relative to assets of developed countries and will be the first choice in the process of global capital reallocation.”Market rally?Qin said A-shares could kick-start a market rally in the second quarter, with government fiscal stimulus as a catalyst. Technology leaders in realms such as 5G phones, cloud computing and Internet data will remain a major investment theme for the rest of the year, he added.What stocks to buy? Qin said he particularly likes companies that benefit from domestic-driven demand and companies that don’t rely heavily on either overseas revenue or upstream material supply chains. Even amid the coronavirus pandemic, the Shanghai stock markets have been welcoming new listings. Initial public offerings hit a new peak in the first quarter, when 34 companies raised an aggregate US$9.8 billion on Shanghai’s main board and new STAR Market, according to data from the Shanghai Stock Exchange. That surpassed new listings on New York’s Nasdaq, where 17 companies raised US$5.13 billion in first-quarter IPOs, according to Refinitiv, a global provider of financial markets data and infrastructure.“I’m not surprised,” said Zhu Ning, associate dean of the Shanghai Advanced Institute of Finance. “There are a huge number of startups in China, and Chinese companies are increasingly inclined to list on domestic markets that have higher valuations.”The strong performance of the IPO market this year is partly due to the 30.7-billion-yuan (US$4.32 billion) January share sale by Beijing-Shanghai High Speed Railway, the biggest first-quarter deal globally.Most of the 34 IPOs in the first quarter were related to technology companies and industrial firms, followed by the medical sector. All 34 are now trading above their initial offer prices.EY, a multinational professional services firm, said it expects the IPO market in China to flourish, underpinned by the recent implementation of the new Securities Law and reforms to the ChiNext market. New listings can now proceed via a registration system without undue regulatory controls that formerly choked the process.“COVID-19 has created business opportunities that are likely to continue once the outbreak is under control, particularly in the health-care sector,” said Ringo Choi, EY’s Asia-Pacific leader for IPOs.Terence Ho, EY’s China IPO leader, said he is “cautiously optimistic” about the economy and IPO prospects for the rest of 2020.”“The Chinese government has already rolled out timely policies to help companies, with more economic stimulus on the way,” he said. “These efforts should help once the outbreak is controlled.”

    Posted: by Shanghai Daily

  • Steady growth on economy into 2018

    CHINA’S manufacturing activity edged down in December, official data showed yesterday, but largely maintained momentum despite curbs on heavy industry aimed at taming the country’s chronic air pollution.

    The manufacturing purchasing managers’ index (PMI), a gauge of factory conditions, stood at 51.6 last month, the National Bureau of Statistics said, compared to 51.8 in November.

    Anything above 50 is considered growth, while under 50 points to contraction.

    China has curbed activity in heavy industries in the northeast to reduce surplus capacity and the heavy smog that typically blankets the region in late autumn and winter.

    The index in December is on par with the annual average, still pointing to a strong resilience in China’s growth, according to NBS senior statistician Zhao Qinghe.

    Sub-indexes for production and new orders came in at 54 and 53.4, respectively. However, the sub-index of raw material inventory stood at 48 in December, down 0.4 percentage points from November, indicating continuously decreasing raw material inventory in the manufacturing sector.

    China’s manufacturing PMI has been in positive territory for 17 months in a row.

    The data also showed that the country’s non-manufacturing sector expanded faster in December, with non-manufacturing PMI at 55 in December, up from 54.8 in November.

    The service sector continued steady growth, with business activity index standing at 53.4 in December.

    “Early indicators for December show China’s economy pushing into 2018 with growth steady, if unspectacular,” said Tom Orlik, Bloomberg chief Asia economist, as “the official purchasing managers’ indexes show the manufacturing sector slowing slightly and non-manufacturing sector picking up.”

    “Growth remains remarkably robust, underpinned by resurgent global demand, stimulus-boosted infrastructure spending, and a deleveraging program that remains more honored in the breach than the observance.”

    Posted: by Shanghai Daily

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