MACROECONOMICS
US GDP shrank 2.9% in Q1
The US economy contracted at a much steeper pace in the first quarter than previously estimated, turning in one of its worst-ever non-recession performances, but growth already appears to have rebounded strongly. The US Commerce Department said on Wednesday that GDP fell at a 2.9 percent annual rate, the sharpest decline in five years, instead of the 1 percent pace it had reported last month, as the economy was held back by an unusually cold winter, the expiration of long-term unemployment benefits and cuts to food stamps, which curbed consumer spending. The economy was also weighed down by a slowdown in the pace of restocking.
FINANCE
LSEG to buy Russell
The London Stock Exchange Group (LSEG) has agreed to buy US asset manager Russell for US$2.7 billion in order to diversify and grow its business in the US, it said yesterday. The deal, worth the equivalent of 1.98 billion euros, also involves the group buying Russell’s index business from parent NorthWestern Mutual. The British group said it would raise US$1.6 billion from the sale of new shares to help fund the deal.
RETAIL
Ikea raises US hourly pay
Ikea’s US division is raising the minimum wage for thousands of its retail workers, pegging it to the cost of living in each location, instead of its competition. The 17 percent average raise, expected to be announced yesterday, is the Swedish ready-to-assemble furniture chain’s biggest in 10 years in the US. The pay hike is to take effect on Jan. 1. It will translate to an average wage of US$10.76 an hour, a US$1.59 increase from the previous US$9.17. About half of its 11,000 hourly store workers will get a raise.
MEDICAL
Philips, Salesforce team up
Royal Philips NV and Salesforce.com Inc say they are jointly developing a software platform for medical services. In a statement yesterday the companies said the system would be used for “patient relationship management,” for instance allowing doctors and nurses to collaborate on patient treatment. Philips is a major maker of medical devices and medical information systems, while San Francisco-based Salesforce.com operates an Internet-based system that helps companies keep track of their customers. The companies did not reveal any financial terms of the deal, or any targets.
BANKING
PRC bank buys London office
China Construction Bank Corp (中國建設銀行), the nation’s second-largest lender, bought an office building in London for £110 million (US$187 million) as it expands in Europe after becoming the city’s first yuan clearing bank. Construction Bank will use the 11,420m2 building on 111 Old Broad Street as its European headquarters, Knight Frank LLP, which advised on the sale, said in an e-mailed statement yesterday. The seller, Belgian bank KBC Groep NV, will remain in the building under a lease agreement.
E-COMMERCE
Rakuten to take airline stake
Japan’s top e-commerce site operator Rakuten will enter the air travel business by allying with Asia’s biggest budget carrier, Malaysia-based AirAsia, a report said yesterday. Rakuten is preparing to make a capital injection in AirAsia’s Japanese unit, possibly next year, the Toyo Keizai economic magazine said on its online edition. Two or three more Japanese companies may also put cash into AirAsia Japan, it said.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the