Asia-Pacific

India is warming up to a cooling China

28 Aug 2023

Narendra Modi’s meeting with Xi Jinping in South Africa signals some thawing of financial ties hamstrung since 2020 by border tensions. Investments from the People’s Republic into its neighbour shrivelled thanks to a screening policy. That now looks ripe for fine-tuning.

Fortescue’s biggest problem sits at the top

28 Aug 2023

The $41 bln Australian iron ore miner is parting ways with CEO Fiona Hick after six months. Hers is the latest in a slew of senior departures that reflect poorly on founder and chair Andrew Forrest. Shareholders can accept he’s becoming a liability, push for his removal, or sell.

Capital Calls: Better.com SPAC

25 Aug 2023

Concise views on global finance: From presidential hopefuls to a new blank-check acquisition, this week was a reminder that the speculative SPAC movement will be hard to kill.

Indian interlopers can disrupt global mining M&A

25 Aug 2023

Sajjan Jindal’s JSW Steel can afford Teck’s coal unit. A full or part bid rivalling Glencore’s $8 bln offer would secure key raw materials and reduce the risk of geopolitical supply shocks. It’s a strong motive for buyers in the fastest growing market for the alloy to do deals.

Arm’s changing business model is wildcard for IPO

24 Aug 2023

As well as jumping on the AI bandwagon, SoftBank’s soon-to-float chip designer has altered the way it charges big customers to boost growth and smooth out revenue. If it works, a valuation north of $60 bln looks slightly less implausible. But investors lack evidence so far.

China’s sliding currency is vote of no confidence

24 Aug 2023

The People’s Republic is scrambling to stop the yuan’s weakening against the US dollar. In this Viewsroom podcast, Breakingviews columnists discuss capital flight pressures and tepid investor interest in the world’s second largest economy, and what that means for the wider world.

Capital Calls: Shein/Forever 21

24 Aug 2023

Concise views on global finance: The Chinese retailer is partnering with Sparc, the operator behind Forever 21. That helps validate Shein before a public listing without the messiness of a merger. Forever 21 gets a new omnichannel and potentially a way to an IPO.

Global insurers surf China’s storm while they can

24 Aug 2023

AIA’s value of new business in Hong Kong more than doubled in the first half. The $100 bln giant and peers are benefitting again from selling policies to returns-hungry mainland visitors. Insurers may become victims of their success if Beijing’s angst over capital flight deepens.

Aussie gas strike risk has market fighting old war

24 Aug 2023

Possible industrial action on key rigs added 41% to the fossil fuel’s European price. Yet with storage nearly full, it trades at a fraction of last year’s peak. Real fear of a new supply crunch would lift it far more. No wonder Woodside and Chevron are taking talks to the wire.

AI frenzy’s feedback loop stuffs Nvidia

23 Aug 2023

The $1.2 trln semiconductor designer’s second-quarter revenue doubled. Tech giants’ valuations are soaring on AI hype, so naturally companies are pouring money into it, including by buying Nvidia's chips. As long as investors quack for more, Jensen Huang's firm gets fed.

Capital Calls: Diversity initiatives

23 Aug 2023

Concise views on global finance: The group that got the Supreme Court to overturn affirmative action at universities is suing financial firms to end programs for diverse applicants. It will make companies rethink recent diversity initiatives.

Italy faces bumpy round trip on the Silk Road

23 Aug 2023

Prime Minister Giorgia Meloni may quit Chinese President Xi Jinping’s infrastructure club. Like other European fans, Italy gained little economic benefit from signing up to the Belt and Road Initiative. Yet leaving may provoke retaliation, perhaps against its luxury industry.

Thailand’s new CEO PM will find it hard to please

23 Aug 2023

Populists and the military voted in Srettha Thavisin, a tycoon. Markets are cheering the end of an impasse. But the $500 bln economy has scant room for handouts and crony capitalism that grew under the prior mogul-turned-leader Thaksin who is back from exile. Relief may be brief.

Volkswagen’s China shortcut will tempt rivals

23 Aug 2023

The $69 bln carmaker is investing in Xpeng and doubling down on cooperation with state-backed SAIC. As Toyota, Ford, BMW and their peers navigate increasingly tough competition in the Chinese market, VW’s plan to reboot its electric vehicles presents a timely but tricky roadmap.

Arm’s IPO risks shine brighter than its potential

22 Aug 2023

SoftBank’s chip group is leaning on the artificial-intelligence boom to justify a hoped-for float valuation north of $60 bln. There’s no evidence to support that in the numbers, which show lumpy, shrinking sales. China risks and lack of investor control also call for a discount.

Capital Calls: Coinbase’s Circle deal

22 Aug 2023

Concise views on global finance: Crypto exchange Coinbase is investing in struggling $26 bln stablecoin issuer Circle. Tokens tracking the US dollar haven’t delivered on hopes of transforming finance; the deal promises little current payoff, but at least keeps the dream alive.

BHP’s dividend cut is canary in ore mine

22 Aug 2023

Boss Mike Henry is talking up the $140 bln miner’s ability to withstand everything from lower commodities prices to China risks. He has a point. But shareholder payouts have fallen to 64% of earnings from last year’s 77%. It suggests some steeling for short-term global shocks.

High food prices put populism on India’s table

22 Aug 2023

The cost of onions and tomatoes are soaring ahead of state elections, ramping up pressure for government relief measures. Modi’s fiscal prudence has helped tame inflation and supports his appeal to global investors. The latest crisis could push everyone out of their comfort zone.

SoftBank Arm deal is expensive gift to Vision Fund

21 Aug 2023

Masayoshi Son’s group bought 25% of the chip designer from its Saudi-backed investment vehicle. It puffs up the fund’s poor returns, but betrays a lack of confidence in an upcoming float. A pricey $64 bln valuation means Son’s fellow SoftBank shareholders will probably lose out.

China woes put global miners’ optimism to the test

21 Aug 2023

BHP boss Mike Henry and Fortescue peer Fiona Hick have remained bullish on the People’s Republic even as the country’s economy, and their own shareholders, waver. Absent Beijing unveiling a big stimulus package, the CEOs are likely to have to revise their enthusiasm.