Wednesday, May 22nd, 2019


Greece’s Marxist minister is back with a message for Europe

IOANNINA (Greece), May 22 — He caused a stir with unorthodox tactics at the peak of Greece’s debt crisis four years ago, sees politics as a job that stinks but still needs doing, and says the European Union needs fixing. Yanis Varoufakis, the…

Greece’s Marxist minister is back with a message for Europe

IOANNINA (Greece), May 22 — He caused a stir with unorthodox tactics at the peak of Greece’s debt crisis four years ago, sees politics as a job that stinks but still needs doing, and says the European Union needs fixing. Yanis Varoufakis, the…

Never mind the profit fall, M&S says, focus on the changes

LONDON, May 22 — Marks & Spencer asked to be judged on how fast it is changing as much as its financial results today, as the British clothing and food retailer reported a third straight drop in annual profits. The 135-year-old mainstay of…

EU sees no compliance issues in Google shopping, rivals disagree

BRUSSELS, May 22 — Europe’s antitrust chief said today she did not see any problems with the way Google was complying with her order to boost competition in online shopping, brushing aside complaints from some of the US company’s rivals. Hit…

US stocks dip, Qualcomm takes a beating

NEW YORK, May 22 — Wall Street stocks dipped early today amid lingering unease over the US-China trade conflict and as chip maker Qualcomm took a beating after a court ruled it violated antitrust law. About 15 minutes into trading, all three major…

China’s big three airlines seek 737 MAX payouts from Boeing, say reports

SHANGHAI, May 22 — China’s three biggest airlines have filed claims seeking compensation from Boeing over the grounding and delayed delivery of 737 MAX 8 aircraft following two deadly crashes, Chinese state media reported today. The reports in…

Europe’s bank supervisors want Carige closed if no buyer found, say sources

FRANKFURT, May 22 — European bank supervisors think Italy’s long-struggling Banca Carige should be closed if it can’t find a buyer, contrary to Rome’s plan for a state rescue, four sources close to the matter said. Carige’s case, the…

Now, China surveillance tech firm Hikvision on US blacklist radar

SHANGHAI: The US administration is considering Huawei-like sanctions on Chinese video surveillance firm Hikvision, media reports show, deepening worries that trade friction between the world’s top two economies could be further inflamed.

The restrictions would limit Hikvision’s ability to buy US technology and American companies may have to obtain government approval to supply components to the Chinese firm, The New York Times reported on Tuesday.

The United States stuck Huawei Technologies on a trade blacklist last week, effectively banning US firms from doing business with the world’s largest telecom network gear maker, in a major escalation in the trade war.

The US has accused Huawei of activities contrary to national security, a charge Huawei denies. However, this week the Trump administration granted the firm a licence to buy US goods until Aug 19 to minimise disruption for customers.

Huawei says it can ensure a steady components supply chain without US help. A Hikvision executive echoed the sentiment.

“Even if the US stops selling them to us we can remedy this through other suppliers,” a Hikvision executive said on condition of anonymity given the sensitivity of the matter.

“The chips Hikvision uses are very commercial and most of the suppliers are actually in China,” she said, but added the company had not been informed of any possible US blacklisting.

The White House did not respond to a request for comment.

Bloomberg, citing people familiar with the matter, reported the US government was deliberating whether to add Hikvision, security equipment maker Zhejiang Dahua Technology and several other unidentified firms to a blacklist.

A Dahua investment department employee declined to comment.

Hikvision, with a market value of more than US$37 billion (RM155 billion), calls itself the world’s largest video surveillance gear maker. Its products are used in public places in China, from Beijing to Xinjiang. Headquartered in high-tech Hangzhou, one of China’s richest cities, it sells close-circuit TV products, traffic and thermal cameras, and unmanned aerial vehicles.

China’s Foreign Ministry today urged the US to provide a fair environment for Chinese firms, in the wake of reports Hikvision could be blacklisted.

“Recently we have repeatedly expressed China’s position of opposing the United States’ abuse of national power to wilfully smear and suppress other countries’ companies, including Chinese companies,” ministry spokesman Lu Kang said at a briefing.

China requires its companies to abide by international norms when investing abroad, but “at the same time we always demand that other countries give Chinese enterprises fair and non-discriminatory treatment”, he added.

Shares in Shenzhen-listed Hikvision, 42% held by state-owned firms, opened 10% lower today. It later pared losses to end 5.54% lower at 26.07 yuan. Dahua plunged 5.91% to 12.74 yuan.

Local semiconductor sector downgraded on heightened US-China tech dispute

PETALING JAYA: TA Securities has downgraded the local semiconductor sector to “underweight” after the escalation in trade tensions between the US and China over the weekend.

“While we are maintaining our forecasts for local companies under our coverage (Inari, MPI, Unisem, and Elsoft) until we obtain further guidance from management in the upcoming results season, we have lowered valuations in view of the increasingly negative sentiment on the sector and correspondingly, downgrade our stance to underweight,” said TA Securities in a research note.

“We have recommendation of ‘buy’ on Inari Amertron Bhd (TP: RM1.80) and ‘sell’ on Malaysian Pacific Industries Bhd (MPI) (TP: RM8.90, downgraded from ‘hold’), Unisem (M) Bhd (TP: RM2.15) and Elsoft Research Bhd (TP:75 sen).”

Local semiconductor stocks took a beating on Tuesday after the US Commerce Department added Huawei to its “Entity List”, which is a trade blacklist that bars anyone on it from buying parts and components from US companies without the government’s approval first.

Shares of Inari fell the most by 6.7% to RM1.40 on Tuesday, followed by Frontken and MPI, which shed 5.6% and 4.2% to RM1.34 and RM9.10, respectively.

TA Securities expects the latest development to be short-term negative to the global semiconductor sector as its effects cascade through the supply chain.

“That said, we also view that it may not be entirely negative as we believe a fall in demand for Huawei smartphones, the world’s second largest smartphone maker, would be largely offset by consumers opting or switching to non-Chinese brands like Samsung and Apple, albeit the latter is susceptible to heightened boycott movements in China”.

TA Securities opined that semiconductor players outside of China are potential beneficiaries of any plans by manufacturers hit by the trade spat to reroute orders or readjust supply chains, albeit the impact may not be immediate and clear cut especially with prospects of a full blown trade war emanating recessionary fears.

Meanwhile, HLIB Research said the trade restriction will equally hurt US companies which increasingly rely on China market for growth and profitability.

“Apple may see limited benefit due to iPhones’ high price points and potential nationalistic retaliation by the Chinese, who are still a significant market for Apple (16% of Apple sales in 1H19).”

“Samsung is likely to have the upper hand in this dispute thanks to its wide spectrum of products and end-to-end in-house capability. Hence, the spillover effects towards non-Korean suppliers are usually hardly felt.”

While maintaining a “neutral” call on the technology sector, HLIB Research said the latest development has created more doubts in the already dull global semiconductor sales and capital spending projections.

“We also take this opportunity to downgrade Frontken to ‘hold’ from ‘buy’ with unchanged target price of RM1.55.”

The US Commerce Department added Huawei to its “Entity List” last week. – AFPPIX

UK chip designer ARM complying with new US rules on Huawei

LONDON, May 22 — British-based chip designer ARM said today it was complying with a move by the United States to block China’s Huawei from accessing US technology. Huawei, in common with Apple and chipmakers like Qualcomm, uses ARM blueprints to…