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CSCI Morning News Circular - 20190528

1. Macro News     

• China Projects Confidence in Weaker Economy as Trade War Worsens. China is strong enough to withstand the effects of the trade war with U.S., according to statements from current and former officials. A top financial regulatory official and a vice information technology minister said the impact on the economy of rising U.S. tariffs are manageable, while Chinese firms can deal with the sudden escalation of trade tensions calmly.  [Bloomberg]     
• S. ‘Not Ready’ to Make a Trade Deal With China, Trump Says. The U.S. isn’t ready to make a trade deal with China, President Donald Trump said while on a state visit to Japan. “I think they probably wish they made the deal that they had on the table before they tried to renegotiate it,” Trump said Mon at a joint press conference in Tokyo.[Bloomberg]     
• Turkey Central Bank Raises Foreign-Currency Reserve Requirements. Turkey’s central bank took another step to boost its coffers by raising the amount of foreign currency lenders are required to park at the regulator as reserves. The monetary authority increased reserve requirements for foreign-exchange deposits by 200 basis points, according to a statement on Monday.  [Bloomberg]     

1. Industry News                      

• Chinese local govts racing to roll out 5G network construction. Regions like the Pearl River Delta region, Yangtze River Delta region and Beijing-Tianjin-Hebei region are gearing up to cultivate industrial clusters valued at trillions of yuan, according to a report by Economic Information Daily.  [China Daily]      
• China's auto sales to remain level with last yr. Automobile sales in China will be around 28.1mn units this year, flat from 2018 level, according to a new report on China's auto industry. Sales of passenger vehicles will be about 23.7mn units, a similar amount compared with last year, said the report jointly released by the CAAM and other parties.  [China Daily]     
• China's industrial profits fall in first 4 months. Profits of China's major industrial firms fell 3.4 percent year-on-year in the January-April period, the National Bureau of Statistics said Monday. Combined profits of industrial firms with annual revenue of more than 20mn yuan ($2.9mn) stood at 1.81 trillion yuan in the first four months of 2019.  [China Daily]     
• Corporate News
• Global Switch Is Said to Plan Hong Kong IPO Filing This Week. Global Switch, the U.K. data center operator controlled by Chinese investors, is planning to file for a Hong Kong IPO as soon as this week. The London-based company aims to raise more than $1bn, Bloomberg News has reported in March.  [Bloomberg]
• China East Education Seeks Up to $680 Million in Hong Kong IPO. China East Education Holdings Ltd., a provider of vocational training, started taking investor orders Monday for a Hong Kong initial public offering that could raise as much as $680mn.  [Bloomberg]
• HKEX, Beijing Antaike Information Sign MOU on Nonferrous Metal. HKEX and Beijing Antaike Information signs MOU to further expand cooperation in the spot market of non-ferrous metal on May 24 in Beijing, the Hong Kong bourse says in a statement on website.  [Bloomberg]
• Alibaba Affiliate to Buy 15% of China Transinfo for 3.59B Yuan. Alibaba (China) Network will buy 15% stake in China Transinfo Technology from 3 shareholders including controlling holder Xia Shudong, Shenzhen-listed Transinfo says in a statement to exchange.  [Bloomberg]
• Alibaba Is Said to Weigh Raising $20B in H.K. Share Sale. Alibaba Group Holding Ltd. is considering raising $20 billion via a second listing in Hong Kong after a record-breaking 2014 New York debut, a mega-deal that will bring China’s largest company closer to investors in its home country as U.S. tensions escalate.  [Bloomberg]
• China Everbright Invests About RMB1.3b in Zhejiang Project. China Everbright secures Zhejiang Tongxiang West Area Drinking Water Sources Protection Public-Private Partnership Project with investment of approx RMB1.253b, co. says in exchange filing.  [Bloomberg]
• Baoshang Bank to Receive Liquidity Injection From Regulators. Baoshang Bank, taken over on Friday by China’s central bank and banking regulator for a year, will receive a liquidity injection to prevent systemic risks, according to a statement on People’s Bank of China website.  [Bloomberg]
• China Plans Key Step in Anbang Sale by Removing Toxic Assets. The Chinese government is taking a major step in its efforts to sell a strategic stake in Anbang Insurance Group Co., the acquisitive insurer it took over last year amid a fraud investigation into its former chairman.  [Bloomberg]
• China Railway Group to Buy 26.5% Stake in Beijing Hengtong. China Railway Group plans to buy stake in Beijing Hengtong Innovation Luxwood Technology at 12 yuan per share, with total consideration of 782.2m yuan, according to exchange filing.  [Bloomberg]
• VW to Reshuffle $56Bn Battery Push as Samsung Deal at Risk. Volkswagen AG is reworking its battery-purchasing plan worth about 50bn euros ($56bn) over concerns a supply deal with Samsung SDI Co. Ltd. might unravel. Samsung initially agreed to deliver batteries for just over 20 gigawatt hours, enough to power 200,000 cars with 100 kilowatt hour packs, before different views on production volume and schedule emerged during detailed negotiations.  [Bloomberg]
• Huawei CEO: Protests Retaliation against Apple; Admits US Ban of Denting Huawei Edges. Chinese govt is not going to take any retaliation against Apple Inc. so as to revenge for Huawei being sanctioned by the US, Huawei Founder and CEO Ren Zhengfei told Bloomberg. Even if that is the case, the CEO said, he will be the first one to protest it.  [AAStocks]  
• Fiat Chrysler Unveils Renault Merger Proposal. Fiat Chrysler Automobiles NV is proposing a merger with French rival Renault SA. Fiat said the proposed combined business would be 50% owned by FCA shareholders and 50% by Group Renault shareholders with a “balanced governance structure”.  [WSJ]
• Huawei, Guizhou to deepen partnership in big data area. Huawei Technologies Co will deepen its partnership with Guizhou province in digital governance, data centers and smart city projects, as the Chinese tech heavyweight leverages the southwestern province's resources and booming big data industry to lower costs and fuel growth.  [China Daily]      
• Huaneng Power Completes Issue of 2.3% RMB2Bn Super Short term Debentures. Huaneng Power announced that it has recently completed the issue of the third tranche of the Company’s super short-term debentures for the year. The total issuing amount was RMB2bn with a maturity period of 90 days whereas the interest rate is 2.3%.  [AAStocks]
• China Oilfield Granted 5 Batches of Govt Subsidies YTD, Involving RMB9.329M. China Oilfield announced that the company received five batches of government subsidies related to income from 1 January 2019 to recently for projects which were mainly tasks assigned by the country, involving RMB9.3291 million.  [AAStocks] 
• Sands China Ltd. to Join Macau Non-mandatory Central Provident Fund Scheme from Jul. Sands China Ltd. is to partake in the Non-mandatory Central Provident Fund (CPF) System from 1 July 2019, reported Macau radio. Starting from 1 July 2019, new hires of the company could choose to join the CPF scheme, while existing staff members could either switch to the CPF system or continue with the current private provident fund scheme.  [AAStocks]