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CSCI Morning News Circular - 20190122

1. Macro News     

• China Posts Weakest Growth Since 2009, Signals Bottoming Ahead. China’s fourth quarter economic data confirmed a slowdown in activity amid a debt cleanup and trade woes, though some signs emerged that the deceleration will be less severe than feared. GDP rose 6.4% in the fourth quarter from a year earlier, the slowest pace since the 2009 financial crisis, and compared with 6.5% in the previous three-month period.  [Bloomberg]
• IMF cuts forecast for global economic growth in 2019 amid trade tensions. The IMF has cut its forecast for world economic growth this year, citing heightened trade tensions and rising interest rates in U.S. The IMF said on Monday it expects global growth this yr of 3.5%, down from 3.7% in 2018 and from 3.7% it had forecast for 2019 in Oct.  [SCMP]  
• China's per capita consumer spending up 6.2% in 2018. China's per capita consumer spending increased by 6.2% YoY in real terms to reach 19,853 yuan ($2,877) in 2018, the National Bureau of Statistics said Monday. The growth rate was 0.8 percentage point higher than that recorded in the previous year.  [China Daily]  

1. Industry News                      

• China's oil imports gallop at double-digit rate, domestic output falls. China's imports of crude oil and natural gas jumped in 2018, official data showed. Crude oil imports surged by 10.1% YoY to 460mn tons last year, a record high, the National Bureau of Statistics said in a statement, Xinhua reports.  [The Standard]
• Grim outlook as China's car sales boom comes to an end. China sold 28.08mn cars last year, down 2.76% from 2017, marking the first fall since 1990 in the world's largest auto market, and the prospects will be no better this year, said officials of the country's leading industry association.  [China Daily]
• China to Move Faster to Open up Banking Sector. The nation will speed up policy implementation to further open up the banking sector and "significantly" widen market access, writes Wang Zhaoxing and Cao Yu, both vice chairmen at China Banking and Insurance Regulatory Commission. China will continue to guide private capital into the banking sector and also promote development of private banks.  [Bloomberg]
• Corporate News5
• Canadian telco Telus backs China’s Huawei as 'viable and reliable'. One of Canada’s largest phone companies is standing by its partnership with Huawei Technologies Co., the Chinese firm at the center of rising diplomatic tensions between Beijing and Ottawa. Telus Corp. sent a memo to employees last week, sticking by its work with Huawei, the Globe and Mail newspaper reported.   [SCMP]
• Huawei founder says West would be ‘foolish’ not to buy its 5G products as they are leading edge. Huawei founder Ren Zhengfei went on China’s state broadcaster to defend the telecom gear supplier’s track record in his first-ever television interview, a move prompted by western government bans on its 5G equipment over security concerns.  [SCMP]
• Huawei Chief Warns of Job Losses Amid 5G Concerns. Huawei founder Ren Zhengfei warned of job losses in an email sent to staff on Friday as several more governments bar the company from supplying equipment for 5G networks, the Financial Times reported, citing the letter.  [Bloomberg]
• Foxconn May Slow Pace of Recruitment at New Wisconsin Plant. Foxconn Technology Group may hire workers at a slower pace for its new Wisconsin plant, adding to mounting gloom over the state of the technology industry and global trade.  [Bloomberg]
• Huaneng Power Int’l, Inc. Power Generation Within China Increased by 9.12% for 2018. According to the preliminary statistics of the Company, in the 4Q of 2018, the Company's total power generation by power plants within China on consolidated basis amounted to 103.707bn kWh, representing an increase of 3.49% YoY.  [Bloomberg]
• China Molybdenum to Fully Acquire BHR Newwood for $1.14 Billion. China Molybdenum Co. plans to fully acquire Chinese private equity firm BHR Newwood DRC Holdings in a deal worth $1.14 billion, expanding its stake in one of the world’s largest producing copper-cobalt mines.  [Bloomberg]
• Thomas Cook and Fosun to Open Two More Hotels in China in 2020. Thomas Cook Group Plc will build two new hotels in China with its joint venture partner Fosun International Ltd., including the first Asian branch of its own Casa Cook brand.  [Bloomberg]
• TSMC Shows Scars From Apple Rout as Key Insights Turn Bearish. Taiwan Semiconductor Manufacturing Co. was among the first major Asian technology companies to report fourth-quarter earnings last week, and the data showed the scars of key customer Apple Inc.’s sales forecast cuts.  [Bloomberg]
• Henan Shuanghui to Buy Out Parent. Henan Shuanghui Investment & Development Co. is planning to take control of the stake of its main shareholder, Henan Luohe Shuanghui Industry Group LLC, via a private placement to Henan Luohe’s sole shareholder, Rotary Vortex Ltd., it said in a statement filed to the Stock Exchange.  [Bloomberg]
• Maoyan Extends IPO Timeline, Xiaomi Joins as Cornerstone. Maoyan Entertainment has extended the bookbuilding for its Hong Kong IPO after three new cornerstone investors including Xiaomi Corp. joined the share sale, according to terms for the deal obtained by Bloomberg.  [Bloomberg]
• CNPC Doubles Earnings in 2018 as Natural Gas Production Climbs. China National Petroleum Corp. says profit totaled 110.6b yuan last year, making it the most profitable co. among the nation’s oil and gas producers, according to statement citing Chairman Wang Yilin at annual work conference.  [Bloomberg]
• Sunac Buys $1.9B of Projects Just as Housing Market Cools. Sunac China Holdings Ltd., the developer known for its aggressive debt-fueled expansion, is buying projects in Beijing and Shanghai for almost $2 billion just as the nation’s property market cools. Sunac is paying 12.6bn yuan ($1.9bn) to purchase Oceanwide Construction Holdings Co., it said in a statement to Hong Kong’s stock exchange Monday. The acquisition is a mix of debt and equity.  [Bloomberg]
• China Res Power, Lawrence Ho's Spade Capital Hail New Energy Cooperation in Greater Bay Area. China Resources Power hailed a JV cooperation agreement with Lawrence Ho Yau Lung's "family office" Spade Capital. Both parties will establish a joint co. to put focus on a series of new energy business development in Guangdong-HK-Macao Greater Bay Area, incl. photovoltaic, waste recycling and new technology applications.   [China Daily]  
• Fosun Tourism predicts 350m yuan net in turnaround. Fosun Tourism Group, which raised HK$3.2bn in a Hong Kong public float in December, said it expects net profit of not less than 350mn yuan for the year ended Dec 31, 2018 compared with a net loss of 295mn yuan for the year ended Dec 31, 2017.  [The Standard]  
• Xiaomi-W To Break into African Mkt. Xiaomi-W is going to set up a unit in African region, where operation will be taken care of by Vice President Wang Lingming who will report to Senior Vice President Wang Xianghui, Mainland media cited Xiaomi-W's internal document.  [AAStocks]