Monday, July 22nd, 2019

 

BA pilots vote for strike action, says UK pilot union

LONDON, July 22 — British Airways pilots have overwhelmingly voted for strike action, pilot union BALPA said today, in a dispute over pay that could disrupt the peak summer holiday season of the British flag carrier. The British Airline Pilots…


Bayer sells Dr Scholl’s for US$585m

FRANKFURT, July 22 — German chemicals and pharmaceuticals giant Bayer said Monday that it had agreed to sell over-the-counter foot care brand Dr Scholl’s to US-based Yellow Wood Partners. The Boston private equity firm will pay US$585 million…


Wall Street gains as earnings season gathers steam

NEW YORK, July 22 — US stocks rose today, lifted by technology companies, as investors eyed fresh US-China trade developments during a busy week of corporate earnings with results from marquee names including Facebook and Amazon on tap….


Equifax to pay up to US$700m over data breach

WASHINGTON, July 22 — US credit monitoring agency Equifax agreed to pay up to US$700 million (RM2.88 billion) in a settlement stemming from a data breach that affected nearly 150 million customers, regulators said today. The biggest-ever penalty…


Trump demands rate cut, seizing on Fed official’s own words

WASHINGTON, July 22 — US President Donald Trump today used a Federal Reserve official’s own words to amplify his continual demands for lower interest rates. The latest in Trump’s daily attacks on the Fed turns up the temperature for the…


Gobind: Govt eyes propelling local tech firms to become multinationals through GAIN programme

KUALA LUMPUR, July 22 — The government is committed to supporting local technology companies to become multinational corporations through the Global Acceleration and Innovation Network (GAIN) programme administered by the Malaysia Digital Economy…


More US firms to set up shop in Malaysia amid shift in supply chain: Business council regional head

KUALA LUMPUR: Malaysia can expect more US firms to establish their presence here amid the ongoing US-China trade war.

“The shift of supply chain has been going on for some time and the trade war has just accelerated that shift,” US-Asean Business Council senior vice-president and regional managing director Michael W Michalak told a press conference at “The Potential of Industry 4.0 for Malaysian SMEs” workshop today.

Big US firms are expediting efforts to move more of their supply chains from China to neighbouring countries, including Malaysia, in light of Trump administration tariffs.

“The movement (of US firms) into Malaysia has been quite big,” International Trade and Industry Minister Datuk Darell Leiking said, adding that it is of importance to Malaysia that the country is able to provide what these investors expect, including an enhanced Industry 4.0 environment and conducive regulatory framework.

However, US Ambassador to Malaysia Kamala Shirin Lakhdhir opined that the Sino-US trade war is not the single factor for the shift of US firms to Malaysia, pointing out that the decisions to invest in Malaysia are based on a range of factors. For example, some of the US firms have decided to use Malaysia as a platform for their Asean or Asia-Pacific businesses.

“Some of them may be looking at what’s happening in the global economy, some maybe specific to Malaysia in terms of talent, infrastructure or connectivity. Each individual firm has a range of reasons why they are moving and where they may be expanding and not a single factor related to tariffs,” said Lakhdhir.

Meanwhile, Darell highlighted that there is a big disparity in the country in terms of the readiness for Industry 4.0.

As at June 30, 2019, 475 applications from small and medium enterprises (SMEs) for readiness assessment of Industy 4.0 were received. The breakdown of application by states are Selangor (205 applications), Johor (59), Penang (57), Perak (32), Kedah (25), Sarawak (22), Malacca (18), Negri Sembilan (18), Federal Territory (13), Kelantan (7), Sabah (7), Terengganu (7) and Pahang (5). Of these, 59 of them have been shortlisted.

“While the government wants to assist your readiness for Industry 4.0, the interest is not so much there for some parts of our states. We need to find out why are they not interested or not moving up the value chain to be ready for Industry 4.0,” said Darell.

He encouraged more collaboration between international cooperation and local SMEs to maximise the potential of Industry 4.0 and called upon SMEs to embrace new technologies and develop strategies that will enable them to transform and continuously remain competitive.

The workshop demonstrated the commitment of US multinational corporations in supporting the Malaysia National Policy on Industry 4.0 or more widely known as Industry4WRD, especially in strengthening SMEs and driving their digital transformation.


More US firms to set up shop in Malaysia amid shift in supply chain: Business council regional head

KUALA LUMPUR: Malaysia can expect more US firms to establish their presence here amid the ongoing US-China trade war.

“The shift of supply chain has been going on for some time and the trade war has just accelerated that shift,” US-Asean Business Council senior vice-president and regional managing director Michael W Michalak told a press conference at “The Potential of Industry 4.0 for Malaysian SMEs” workshop today.

Big US firms are expediting efforts to move more of their supply chains from China to neighbouring countries, including Malaysia, in light of Trump administration tariffs.

“The movement (of US firms) into Malaysia has been quite big,” International Trade and Industry Minister Datuk Darell Leiking said, adding that it is of importance to Malaysia that the country is able to provide what these investors expect, including an enhanced Industry 4.0 environment and conducive regulatory framework.

However, US Ambassador to Malaysia Kamala Shirin Lakhdhir opined that the Sino-US trade war is not the single factor for the shift of US firms to Malaysia, pointing out that the decisions to invest in Malaysia are based on a range of factors. For example, some of the US firms have decided to use Malaysia as a platform for their Asean or Asia-Pacific businesses.

“Some of them may be looking at what’s happening in the global economy, some maybe specific to Malaysia in terms of talent, infrastructure or connectivity. Each individual firm has a range of reasons why they are moving and where they may be expanding and not a single factor related to tariffs,” said Lakhdhir.

Meanwhile, Darell highlighted that there is a big disparity in the country in terms of the readiness for Industry 4.0.

As at June 30, 2019, 475 applications from small and medium enterprises (SMEs) for readiness assessment of Industy 4.0 were received. The breakdown of application by states are Selangor (205 applications), Johor (59), Penang (57), Perak (32), Kedah (25), Sarawak (22), Malacca (18), Negri Sembilan (18), Federal Territory (13), Kelantan (7), Sabah (7), Terengganu (7) and Pahang (5). Of these, 59 of them have been shortlisted.

“While the government wants to assist your readiness for Industry 4.0, the interest is not so much there for some parts of our states. We need to find out why are they not interested or not moving up the value chain to be ready for Industry 4.0,” said Darell.

He encouraged more collaboration between international cooperation and local SMEs to maximise the potential of Industry 4.0 and called upon SMEs to embrace new technologies and develop strategies that will enable them to transform and continuously remain competitive.

The workshop demonstrated the commitment of US multinational corporations in supporting the Malaysia National Policy on Industry 4.0 or more widely known as Industry4WRD, especially in strengthening SMEs and driving their digital transformation.


Frenzied trading as China’s Nasdaq-style board makes stellar debut

SHANGHAI: Trading on China’s new Nasdaq-style board for home-grown tech firms hit fever pitch today, with shares up as much as 520% in a wild debut that more than doubled the board’s combined market capitalisation and beat veteran investors’ expectations.

Sixteen of the first batch of 25 companies – ranging from chipmakers to healthcare firms – increased their already frothy initial public offering (IPO) prices by 136% on the STAR Market, operated by the Shanghai Stock Exchange (SSE).

The raucous first day of trade tripped the exchange’s circuit breakers that are designed to calm frenzied activity. The weakest performer leapt 84.22%. In total, the day saw the creation of around 305 billion yuan (RM182 billion) in new market capitalisation on top of an initial market cap of around 225 billion yuan, according to Reuters’ calculations.

“The price gains are crazier than we expected,” said Stephen Huang, vice-president of Shanghai See Truth Investment Management. “These are good companies, but valuations are too high. Buying them now makes no sense.”

Modelled after Nasdaq, and complete with a US-style IPO system, STAR may be China’s boldest attempt at capital market reforms yet. It is also seen driven by Beijing’s ambition to become technologically self-reliant as a prolonged trade war with Washington catches Chinese tech firms in the crossfire.

Trading in Anji Microelectronics Technology (Shanghai) Co Ltd, a semiconductor firm, was briefly halted twice as the company’s shares hit two circuit breakers – first after rising 30%, then after climbing 60% from the market open.

The mechanisms did little to keep Anji shares in check as they soared as much as 520% from their IPO price in the morning session. Anji shares ended the day up 400.2% from their IPO price, the day’s biggest gain, giving the company a valuation of nearly 242 times 2018 earnings.

Suzhou Harmontronics Automation Technology Co Ltd, in contrast, triggered its circuit breaker in the opposite direction, falling 30% from the market open in early trade before rebounding. But by the market close, the company’s shares were still 94.61% higher than their IPO price.

Wild share price swings, partly the result of loose trading rules, had been widely expected. IPOs had been oversubscribed by an average of about 1,700 times among retail investors.

The STAR Market sets no limits on share prices during the first five days of a company’s trading. That compares with a cap of 44% on debut on other boards in China.

In subsequent trading sessions, stocks on the new tech board will be allowed to rise or fall a maximum 20% in a day, double the 10% daily limit on other boards.

Regulators last week cautioned individual investors against “blindly” buying STAR Market stocks, but said big fluctuations were normal.

Looser trading rules were aimed at “giving market players adequate freedom in the game, accelerating the formation of equilibrium prices, and boosting price-setting efficiency”, the SSE said in a statement on Friday.

The SSE added that it was normal to see big swings in newly listed tech shares, as such companies typically have uncertain prospects, and are difficult to evaluate.

The exchange cited big fluctuations in IPOs shares on Nasdaq and the Hong Kong stock exchange, in particular singling out recently listed electric car firm Nio Inc and Chinese start-up Luckin Coffee.

SSE said that an index tracking the STAR Market would be launched on the 11th trading day following the debut of the 30th company on the board.

Investor focus on the STAR Market in the short term could weigh on the main board in terms of liquidity and attention, said Zhu Junchun, chief analyst with Lianxun Securities.

That effect was clear today, with the benchmark Shanghai Composite Index falling 1.27%, and the blue-chip CSI300 index ending 0.69% lower.

Dual-listed China Railway Signal & Communications Corp Ltd clearly illustrated the gap in investor enthusiasm. Its STAR Market shares more than doubled from their IPO price, even as its Hong Kong shares dropped 11.7% following worse-than-expected preliminary results.

Huang at Shanghai See Truth suggested rational investors wait on the sidelines and observe the market for a month, before making purchasing decisions.

Some investors, nevertheless, hailed the debut of the board that Beijing hopes will propel investment in the sector and help the country innovate and compete globally.

Yang Tingwu, vice general manager of Tongheng Investment, a hedge fund house in Fujian province, said he viewed 80% of listed companies as “cannon fodder”, but the chance of the remaining 20% producing China’s next Tencent or Huawei made the market turmoil worth it.

“The STAR Market opens a new chapter for China’s stock market. Toast to the Chinese dream in our capital markets!” he said.


Frenzied trading as China’s Nasdaq-style board makes stellar debut

SHANGHAI: Trading on China’s new Nasdaq-style board for home-grown tech firms hit fever pitch today, with shares up as much as 520% in a wild debut that more than doubled the board’s combined market capitalisation and beat veteran investors’ expectations.

Sixteen of the first batch of 25 companies – ranging from chipmakers to healthcare firms – increased their already frothy initial public offering (IPO) prices by 136% on the STAR Market, operated by the Shanghai Stock Exchange (SSE).

The raucous first day of trade tripped the exchange’s circuit breakers that are designed to calm frenzied activity. The weakest performer leapt 84.22%. In total, the day saw the creation of around 305 billion yuan (RM182 billion) in new market capitalisation on top of an initial market cap of around 225 billion yuan, according to Reuters’ calculations.

“The price gains are crazier than we expected,” said Stephen Huang, vice-president of Shanghai See Truth Investment Management. “These are good companies, but valuations are too high. Buying them now makes no sense.”

Modelled after Nasdaq, and complete with a US-style IPO system, STAR may be China’s boldest attempt at capital market reforms yet. It is also seen driven by Beijing’s ambition to become technologically self-reliant as a prolonged trade war with Washington catches Chinese tech firms in the crossfire.

Trading in Anji Microelectronics Technology (Shanghai) Co Ltd, a semiconductor firm, was briefly halted twice as the company’s shares hit two circuit breakers – first after rising 30%, then after climbing 60% from the market open.

The mechanisms did little to keep Anji shares in check as they soared as much as 520% from their IPO price in the morning session. Anji shares ended the day up 400.2% from their IPO price, the day’s biggest gain, giving the company a valuation of nearly 242 times 2018 earnings.

Suzhou Harmontronics Automation Technology Co Ltd, in contrast, triggered its circuit breaker in the opposite direction, falling 30% from the market open in early trade before rebounding. But by the market close, the company’s shares were still 94.61% higher than their IPO price.

Wild share price swings, partly the result of loose trading rules, had been widely expected. IPOs had been oversubscribed by an average of about 1,700 times among retail investors.

The STAR Market sets no limits on share prices during the first five days of a company’s trading. That compares with a cap of 44% on debut on other boards in China.

In subsequent trading sessions, stocks on the new tech board will be allowed to rise or fall a maximum 20% in a day, double the 10% daily limit on other boards.

Regulators last week cautioned individual investors against “blindly” buying STAR Market stocks, but said big fluctuations were normal.

Looser trading rules were aimed at “giving market players adequate freedom in the game, accelerating the formation of equilibrium prices, and boosting price-setting efficiency”, the SSE said in a statement on Friday.

The SSE added that it was normal to see big swings in newly listed tech shares, as such companies typically have uncertain prospects, and are difficult to evaluate.

The exchange cited big fluctuations in IPOs shares on Nasdaq and the Hong Kong stock exchange, in particular singling out recently listed electric car firm Nio Inc and Chinese start-up Luckin Coffee.

SSE said that an index tracking the STAR Market would be launched on the 11th trading day following the debut of the 30th company on the board.

Investor focus on the STAR Market in the short term could weigh on the main board in terms of liquidity and attention, said Zhu Junchun, chief analyst with Lianxun Securities.

That effect was clear today, with the benchmark Shanghai Composite Index falling 1.27%, and the blue-chip CSI300 index ending 0.69% lower.

Dual-listed China Railway Signal & Communications Corp Ltd clearly illustrated the gap in investor enthusiasm. Its STAR Market shares more than doubled from their IPO price, even as its Hong Kong shares dropped 11.7% following worse-than-expected preliminary results.

Huang at Shanghai See Truth suggested rational investors wait on the sidelines and observe the market for a month, before making purchasing decisions.

Some investors, nevertheless, hailed the debut of the board that Beijing hopes will propel investment in the sector and help the country innovate and compete globally.

Yang Tingwu, vice general manager of Tongheng Investment, a hedge fund house in Fujian province, said he viewed 80% of listed companies as “cannon fodder”, but the chance of the remaining 20% producing China’s next Tencent or Huawei made the market turmoil worth it.

“The STAR Market opens a new chapter for China’s stock market. Toast to the Chinese dream in our capital markets!” he said.