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CSCI Morning News Circular - 20180525

1. Macro News

• Fed Minutes: Most Officials Expect Rate Hikes Again Soon. According to the Fed minutes in May, officials judged that the economic outlook is strong, while most of them agreed that it will soon be appropriate for the FOMC to take another step in further rate hikes if the resilient prospect remains.   [AAStocks]        
• Singapore Posts Solid Growth to Start 2018 Amid Global Risks. Singapore’s economy remained on solid footing in the first quarter, with the government expressing more certainty of a steady pace in 2018 as global trade risks and tightening financial conditions allow for a patient monetary policy.  [Bloomberg]   
• China Plans Tariff Cut on Wide Range of Consumer Goods. China is planning to reduce import duties on consumer goods ranging from food to cosmetics. The tariff cuts, which would be effective as early as July 1, would apply to significantly more product lines than a similar reduction on around 200 items announced last year.  [Bloomberg]  

1. Industry News

• S. Starts Probe to Consider Tariffs on Car, Truck Imports. President Donald Trump’s administration has started an investigation into whether car and truck imports threaten national security, a move that could lead to new U.S. tariffs on foreign vehicles.  [Bloomberg]    
• Bank of Korea Stands Pat After Disappointing Economic Data. The Bank of Korea left its benchmark interest rate unchanged in a unanimous decision on Thursday after recent weakness in economic data raised concerns about the outlook. The decision to hold the seven-day repurchase rate at 15% since a hike in Nov was forecast by all 18 analysts surveyed by Bloomberg.  [Bloomberg]     
• MSCI's A-share move set to boost capital market structure. The steady progress in the MSCI's inclusion of Chinese A-shares is expected to bring in more long-term institutional investors, and improve the market structure and investment practices of the nation's stock markets, experts said.  [China Daily]    
• Corporate News
• Buffett-Backed BYD to Build Brazil Monorail, Biggest Win Abroad. BYD Co. won its biggest overseas order for monorail systems in an affirmation of efforts by the Chinese electric-vehicle maker to revive profit growth. The company signed a 2.5bn Brazilian real ($689mn) order this week to build a light transit system in Salvador, Brazil.  [Bloomberg]    
• Geely’s Korean Parnter Mando Seeks Bounty in China’s EV Startups. South Korean auto-parts maker Mando Corp, which supplies to Chinese EV startups including Byton, is expecting sales in China to grow 10% annually in the next few years. The JV partner of Geely Group is also looking to increase supplies to Changan Automobile Group and Great Wall Motor Co.  [Bloomberg]    
• Lenovo chief says US and China need each other, globalisation won’t reverse course. The head of Lenovo Group said that despite trade tensions between the US and China, the world’s two biggest economies need each other as globalisation pushes forward.  [SCMP]   
• Lenovo's revenue beats estimates as PC arm shows signs of life. The world’s second-largest PC vendor reported a 69% plunge in net income to US$33mn in the three months ended March as it grappled with rising expenses. Sales however jumped 11% to $10.6bn, surpassing the $9.8bn projected and marking its first double-digit percentage increase since late 2015.  [SCMP]   
• China’s short-video app Douyin accuses Tencent of being anti-competitive. China's short-video platform Douyin said on Wednesday it is considering legal action against internet giant Tencent Holdings, accusing the latter of using “its dominant market position to eliminate competition”.  [SCMP]   
• Chinese airline takes delivery of first Boeing 737 MAX aircraft. Chinese Xiamen Airlines has taken the delivery of the first 737 MAX passenger plane, also the 200th Boeing jet received by the Chinese carrier, US top aircraft manufacturer Boeing Co said Wednesday.  [China Daily]    
• Tencent developing voice-interactive WeChat. Tencent Holdings Ltd is developing a voice-interaction based WeChat which it hopes can be applied to internet-connected cars. Company Chairman Pony Ma revealed the development at the Tencent Cloud Summit 2018 in Guangzhou on Wednesday.  [China Daily]    
• JiaYi plans to buy more UK childcare center. JiaYi Education is planning to open British-style preschools in China and acquire more childcare centers in the United Kingdom, following its recent purchase of Devonshire-based nursery group Bambinos, a company associate said.  [China Daily]    
• Kingsoft profit falls 50pc to $145mn. Software and internet service company Kingsoft Corporation (3888) saw its net profit for the first quarter ended March fell by 50.35 percent year-on-year, to 118.4 million yuan (HK$145.5 million). No dividend was declared.  [The Standard]    
• Sinopec Corp Said To Lift US Crude Imports to Record High. Sinopec Corp. will raise crude oil imports from the US to record high, forming part of Chinese measures in narrowing trade deficit with the US. A trade company under SINOPEC CORP purchased 16mn barrels of US crude oil for June delivery, equivalent to 533,000 barrels per day.  [AAStocks]     
• Baidu, Alibaba, NetEase To Hopefully Return to A-share Mkt by CDRs Next Month. Baidu, Alibaba and NetEase will become the first batch of technology companies returning to A-share market, Mainland media Qianjiang Evening News reported. In addition, Alibaba, Xiaomi and JD are neatly preparing for issuance of Chinese Depositary Receipts (CDRs) in order to return to A-share market.   [AAStocks]    
• ZTE Controlling Shareholder Buys 2.038M H Shares. ZTE announced that the controlling shareholder ZTE Holdings acquired a total of 2.038mn H shares in the Company through Shenzhen-Hong Kong Stock Connect during the period from 24 May 2017 to 15 June 2017, representing approx.. 0.049% of the total number of shares in the Company.  [AAStocks]     
• Sina Said to Mull 2nd Listing in HK; May Come True in 4Q. Sina Corp, listed on NASDAQ, is considering a second listing in Hong Kong, which may come true in the fourth quarter of this year, Reuters cited sources.  [AAStocks]    
• Production, Sales of Metal To Be Severely Impacted if US Not Lift Sanctions by 23 Oct. Rusal announced that unless sanctions are lifted or a new license is granted by Office of Foreign Assets Control of the Dept. of the Treasury of the U.S. to the Company, int’l financial institutions are likely to discontinue operations with the Group after 23 Oct 2018, the company’s production of metal and the sales will be severely impacted.  [AAStocks]    
• Ping An Subsidiary Sells Stakes in NEW Higher Education for $540mn. According to market sources, Ping An’s Adance Vision plans to sell 80 million shares in New Higher Education for cashing in up to $560 million.  [AAStocks]    
• Xinyi Glass Buys Back Shares at Nearly $16.4567 million. Xinyi Glass announced that it had repurchased 1.458 million shares at $16.4567 million on 23 May at $11.16-11.4 per share.  [AAStocks]