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CSCI Morning News Circular - 20181123

1. Macro News     

• Italian Budget Rejected Again; EU Warns of Sanctions. Italy's draft budget plan was once again rejected by the EU for breaching terms of the Eurozone. The country will need to submit a revised plan and set up relevant schedule in two weeks; otherwise, the EU will officially launch sanction procedure on Italy.  [AAStocks]  
• Singapore Sees Slower 2019 Growth as Key Export Markets Weaken. Trade-reliant Singapore is bracing for slower economic growth next year as demand in key markets in Asia weakens. Growth is seen easing to 1.5% to 3.5% in 2019 from a projected range of 3% to 3.5% in 2018, the Ministry of Trade and Industry said in a statement.  [Bloomberg] 
• Japan’s Inflation Stalls at 1% as Risks to Price Gains Gather. Slow but steady improvement in Japan’s core inflation gauge has come to a halt as a host of forces gather that could see price gains begin to slow. Consumer prices excluding fresh food rose 1 percent in October from a year earlier, as expected by economists.  [Bloomberg]     

1. Industry News   

• China Said to Eye Steel Mega-Deal as Baowu Chief Joins Rival. China has named the former chairman of Baoshan Iron & Steel Co. as president of rival Ansteel Group Corp., signaling its intention to merge the two parent companies and create a steel giant that would top ArcelorMittal as the world’s largest producer.  [Bloomberg] 
• China Proposes to Limit Use of Trading Halts to Curb Abuses. China is seeking to reduce the period of time listed companies can suspend their shares, citing abuses by companies that halt trading during volatile markets. Trading halts for restructuring will be limited to 10 days,according to proposals from the Shanghai and Shenzhen stock exchanges.  [Bloomberg] 
• Yuan Debt in the Bag for Philippines as Xi-Duterte Ties Grow. The Philippines plans to return to the Panda bond market next year with a potential 6-billion-yuan ($860 million) offer, after its 1.46-billion-yuan maiden sale in March, Finance Secretary Carlos Dominguez said in a statement. [Bloomberg] 
• Corporate News
• Meituan Dianping losses widen in first earnings after Hong Kong IPO. Meituan Dianping, operator of the world’s largest on-demand food delivery service, reported a 97.2 per cent jump in revenue in the quarter ended September 30, as losses widened because of higher operating expenses.  [SCMP] 
• Cheung Kong Infrastructure faces tough sell in plan to spin-off some assets in London listing. Cheung Kong Infrastructure Holdings faces an uphill battle in its drive to sell stakes in some European infrastructure assets through a spin-off to be listed in London, according to analysts.  [SCMP] 
• China Eastern plans to buy stakes of Juneyao Airlines. China Eastern Airlines has announced it will purchase no more than 169mn shares of Juneyao Airlines worth no more than 3.15bn yuan ($456mn). China Eastern's subsidiary, the Eastern Airlines Industry Investment Co Ltd, will conduct the deal with Juneyao Airlines.  [China Daily]   　
• Country Garden Raises $1B to Refinance Convertible Bonds. Country Garden Holdings Co. raised HK$7.83bn in a convertible bond sale as it takes on higher-cost funding to push out repayments. The company priced its sale of five-year convertible bonds with a 4.5% coupon, according to terms for the deal obtained by Bloomberg.  [Bloomberg]  
• HNA in Talks With China Cinda for Advice on Asset Sales. HNA Group’s vice president Dennis Chen met with Cinda President Chen Xiaozhou on Tuesday to discuss cooperation, Reuters reports. Cinda told HNA it stood ready to help; “Especially when HNA is in a relatively difficult time, there is all the more reason for us to increase our support”: report cites internal memo from Chen Xiaozhou.  [Bloomberg]  
• Dolce & Gabbana China Blunder Rages On as Sites Pull Brand. Thousands of Dolce & Gabbana goods have been pulled from China’s biggest shopping websites and calls for a boycott of the brand are gaining traction as an uproar over the Italian fashion house’s Chinese advertising campaign grows.  [Bloomberg]  
• Tesla Lowers Car Prices in China After Trade War Hits Demand. Tesla Inc. lowered the prices of the Model S and Model X in China, seeking to boost sales after the trade war with the U.S. hit demand in the world’s biggest car market. Tesla said it decided to absorb a “significant” part of the tariffs that China charges on cars imported from the U.S. to make its vehicles more affordable.  [Bloomberg]  
• China’s Cosco Puts Long Beach Container Terminal Up for Sale. China’s Cosco Shipping Holdings is starting the process of selling its large container terminal in Long Beach, California, Wall Street Journal reports. Sale is part of agreement with U.S. regulators that gave co.the green light to buy Orient Overseas International in July.  [Bloomberg]  
• HNA Widens Aviation Asset Sales, Paring Back Core Business. The ­flagship aviation unit of debt-laden Chinese conglomerate HNA Group Co. is selling more assets from its core airlines and related services business, evidence that it’s leaving nothing untouched in the race to raise cash to pay down debts.  [Bloomberg]  
• Apple Supplier Foxconn Signals Deep Cuts as iPhone Demand Wanes. Foxconn Technology Group, the biggest assembler of iPhones, became the latest Apple Inc. supplier to warn of anemic demand, with an internal memo suggesting that expenses will be cut by almost a half next year.  [Bloomberg] 
• Hang Seng Bank Says HSBC Asia Becomes Intermediate Holding Co. HSBC Asia Holdings Limited has acquired an indirect interest in 62.142% of Hang Seng Bank after restructuring, Hang Seng Bank says in HK stock exchange filing. Main purpose of restructuring is to meet certain regulatory requirements by the HKMA and other regulators.  [Bloomberg]  
• Xinyi Energy Starts Gauging Demand for Hong Kong IPO. The company plans to use proceeds for acquisition for utility-scale ground-mounted solar farm project, working capital and loan refinancing, according to terms for the deal obtained by Bloomberg.  [Bloomberg]  
• Nvidia Partners With JD.com, Meituan on Delivery. Nvidia is partnering with JD.com and Meituan Dianping to develop unmanned delivery vehicles, using its chip series, China Daily reports, citing Nvidia CEO Jensen Huang. Report doesn’t give details of the partnership.  [Bloomberg]  
• China Resources Beer Adopts Div Policy; Annual Div Not To Less Than 20% of Profit. China Resources Beer announced that the Board has approved and adopted a dividend policy on 21 November 2018. According to the Dividend Policy, the annual dividend to be distributed by the Company to the Shareholders shall be not less than 20% of the Group’s profit attributable to Shareholders in any financial year.   [AAStocks]  
• Xinyi Solar Shareholders Approve Xinyi Energy's Spin-Off & Listing. Xinyi Solar announced that at the extraordinary general meeting on 21 November, the resolution on the proposed spin-off and listing of Xinyi Energy was approved by shareholders, with 99.86% of shareholders in favour of the resolution.  [AAStocks]