pacific

 
 

AirAsia goes A321neo to boost load factor, expansion

KUALA LUMPUR, Oct 20 — AirAsia will start receiving its Airbus A321neo from the end of 2019, which would enable it to further improve efficiency and boost capacity to routes such as Singapore where the slots have been maxed out, chief executive…


Thailand says ‘good feeling’ over China-backed RCEP

BANGKOK, Oct 18 — Thailand has a “good feeling” that a China-backed free trade pact for countries with nearly half the world’s population will be agreed this year after years of delay, a Thai official said today. Negotiators for the…


Global shares slip on weak China growth, dollar suffers weekly mauling

LONDON, Oct 18 — World stocks slipped after China posted its weakest growth rate in nearly three decades today, while the dollar was set for its worst week in almost four months having been pummelled by pound and euro Brexit rallies. China’s…


Higher growth forecast in tandem with Malaysia's GDP projection

KUALA LUMPUR, Oct 18 — The forecast improvement in global economic growth to 3.4 per cent next year from three per cent this year is in tandem with the country’s higher projected gross domestic product (GDP) expansion of 4.8 per cent from 4.7…


Oil ebbs as China’s slowest GDP growth in almost 3 decades stokes demand fears

SEOUL: Oil prices slid on Friday on jitters over demand from China after the world’s largest oil importer recorded its weakest quarter of economic growth in nearly three decades, dragged down by a trade dispute with the United States.

Global benchmark Brent crude oil futures fell by 21 cents, 0.4%, to $59.70 a barrel by 0646 GMT.

U.S. West Texas Intermediate (WTI) crude futures edged down by 4 cents, or 0.1%, to $53.89 per barrel.

In the third quarter, China’s gross domestic product (GDP) growth slowed to 6% year-on-year, its weakest pace in 27-1/2 years and below expectations, dogged by soft factory production amid ongoing trade tensions with United States and sluggish domestic demand.

“The (China) GDP print has weighed on short-term sentiment and we have seen regional stock markets and oil contracts edge lower because of that,“ said Jeffrey Halley, senior market analyst for Asia Pacific at brokerage OANDA.

Crude demand growth tends to track economic growth trends, but Halley said China’s need for oil would not recede any time soon.

Underlining that view, Chinese official data released on Friday showed robust refinery throughput in September, rising 9.4% from a year earlier to 56.49 million tonnes, on increases from new refineries and some independent refiners resuming operations after maintenance.

“There’s a lot of demand pessimism already priced into the oil markets … China GDP (growth) was not negative enough (below 6%) to alter the positive effects for the trade talks,“ said Stephen Innes, Asia Pacific market strategist at AxiCorp.

U.S. and Chinese trade negotiators are working on nailing down a Phase 1 trade deal text for their presidents to sign next month, U.S. Treasury Secretary Steven Mnuchin said on Wednesday.

Adding to the downward pressure, U.S. crude oil stockpiles surged last week by 9.3 million barrels as refinery output dropped to a two-year low, while gasoline and distillate fuel inventories decreased, the Energy Information Administration said on Thursday.

Elsewhere, the joint technical committee monitoring a global deal to cut output between the Organization of the Petroleum Exporting Countries (OPEC) and partners, including Russia, found compliance with cuts for September stood at 236%, according to four OPEC sources.

“Concerns about softer growth in the demand for oil and doubts about OPEC’s ability to rebalance the market on the current production cut rate will be key drags on prices in the near term,“ ANZ Research said in a note.

OPEC and its allies have agreed to limit their oil production by 1.2 million barrels per day (bpd) until March 2020.

OPEC lowered its 2019 global oil demand growth forecast to 0.98 million bpd, while leaving its 2020 demand growth estimate unchanged at 1.08 million bpd, according to OPEC’s latest monthly report. -Reuters


Cathay Pacific shelves US dollar bond plans amid Hong Kong unrest

SINGAPORE: Cathay Pacific Airways Ltd has shelved plans for its first U.S. dollar debt deal in 23 years, the airline said on Friday, after sources told Reuters that global investors had baulked at the pricing due to civil unrest in Hong Kong.

The airline, the biggest corporate casualty of widespread anti-government protests in the Asian financial hub, on Friday lowered its second-half profit expectations, citing “incredibly challenging” conditions in its home market.

Cathay had started meeting investors in Hong Kong and Singapore on Sept. 24 after it mandated four banks to explore carrying out a U.S. dollar denominated bond, according to a term sheet issued at the time, seen by Reuters.

It would have been the first U.S. dollar debt deal for Cathay since 1996 and had been touted as a landmark transaction for the airline given all of its debt is denominated in Hong Kong dollars.

The issuance was to be unrated, and two sources with knowledge of the matter said that Cathay was willing to pay 200 basis points over the U.S. Treasuries rate to secure three-year or five-year funding, with the size and term of the placement dependent on demand.

However, investors demanded a higher price of at least 300 basis points over U.S. Treasuries, which made the deal more expensive for Cathay, said the sources, who were not authorised to speak publicly about the matter.

Cathay’s term sheet had said the transaction would be reliant on market conditions. A Cathay spokesman on Friday said the Hong Kong dollar private placement market was providing more funding opportunities and a debt issuance in that market was completed last month. “We will continue to monitor the U.S. dollar bond market in future,“ he said in a statement.

Dealogic data showed that Cathay raised $102 million in October and $64 million in May through Hong Kong dollar denominated deals.

The airline has only carried out 12 bond transactions in the past decade and all were priced in Hong Kong dollars.

Cathay had mandated Bank of America Merrill Lynch, BNP Paribas, Deutsche Bank and HSBC to work on the shelved U.S. dollar bond deal. – Reuters


Asian stocks track Brexit deal cheer but China caution prevails

SHANGHAI, Oct 18 — Asian stocks edged higher today, tracking the global lift in sentiment after the UK and the European Union struck a long-awaited Brexit deal, but concern about the Chinese economy is likely to cap gains with data expected to…


China says hopes to reach phased trade pact with US as early as possible

BEIJING, Oct 17 — China’s commerce ministry said today that China hoped to reach a phased agreement with the United States over trade as early as possible, and make progress on cancelling tariffs on each others’ goods. A phased agreement would…


Asian shares pause after 5-day rally, Brexit in focus

TOKYO/SYDNEY: Asian stocks barely moved on Thursday as soft U.S. retail sales data raised fears about the health of the world’s largest economy, sucking the steam out of a five-session rally, while hopes of a Brexit deal kept sterling volatile.

South Korean, Australian and New Zealand indexes were all in negative territory. Chinese shares were mostly flat while Japan’s Nikkei ticked up and U.S. stock futures were barely changed.

That left MSCI’s broadest index of Asia-Pacific shares outside Japan slightly higher with gains largely led by Hong Kong’s Hang Seng index.

The S&P 500 shed 0.20% on Wednesday after data showed U.S. retail sales contracted in September for the first time in seven months, in a potential sign that manufacturing-led weakness could be spreading to the broader economy.

“It looks like the trade war has claimed yet another victim, in addition to diminished business confidence and reduced investment spending, as consumers are starting to chicken out,“ said Chris Rupkey, chief financial economist at MUFG Union Bank.

Given U.S. consumption has been one of few remaining bright spots in the global economy, the data fanned worries the Sino-U.S. trade war would tip the world into recession.

U.S. Treasury Secretary Steven Mnuchin said on Wednesday that U.S. and Chinese trade negotiators were working on nailing down a Phase 1 trade deal text for their presidents to sign next month.

But he also said there were no plans for another high-level meeting on the trade deal outlined last week.

“While the U.S. suspended a hike in tariffs, it hasn’t gone as far as scrapping the tariffs altogether, so it is hard to expect a quick pick-up in the economy,“ said Yoshinori Shigemi, global market strategist at JPMorgan Asset Management.

Not for the faint-hearted

Losses in equities were somewhat offset by a solid start to the earnings season, though that is partly because investors have already marked down their expectations substantially. Earnings for S&P 500 companies are forecast to show a decline of 3% for the quarter, according to Refinitiv data.

Bank of America shares rose 2.0% following its quarterly results. Netflix rose 9.9% in after-hours trade after its earnings beat Wall Street estimates.

In the currency market, soft U.S. retail sales took the shine out of the dollar.

The dollar index was last at 98.005, having touched its lowest since Aug. 27 on Wednesday.

Against the yen, it was a flat at 108.73 after peaking at 108.90 on Tuesday.

The euro stood at $1.1074, near a one-month high of $1.1085 hit in U.S. trade on Wednesday.

Sterling traded at $1.2821, having risen to as high as $1.2877 on Wednesday, its loftiest since mid-May.

The pound has risen more than 5% in the past five sessions on hopes the United Kingdom and the European Union can strike a fresh deal in an EU leaders’ summit on Thursday and Friday.

Investors have welcomed optimistic comments from key officials in the last few days. British culture minister Nicky Morgan said late on Wednesday there is a good chance of a deal.

Still, many doubts remained, not the least of which is if British Prime Minister Boris Johnson can ensure his government and factious parliament approve the plan.

“Trading the British pound intra-day at the moment is not for the faint-hearted with deep pockets required,“ said Jeffrey Halley, senior market analyst at OANDA.

“The street clearly wants to take GBP higher on any Brexit hope, but traders should be aware that the pullback will be equally as ugly if progress stalls or collapses yet again.”

In commodities, oil prices slipped after industry data showed a larger-than-expected build-up in U.S. crude stocks, adding to concerns that demand for oil around the world may weaken amid further signs of a global economic slowdown.

Brent crude futures fell 0.47% to $59.14 a barrel while U.S. West Texas Intermediate (WTI) crude lost 0.7% to $52.98.

Spot gold was slightly weaker at $1,488.31 an ounce. -Reuters


Trump says likely won’t sign China trade deal until he meets with Xi

WASHINGTON, Oct 17 — US President Donald Trump yesterday said he likely would not sign any trade deal with China until he meets with Chinese President Xi Jinping at the upcoming Apec Forum in Chile. Trump, speaking to reporters at the White House,…