SERVICES
Chinese PMI rises to 53.5%
Activity in China’s services sector accelerated last month, the HSBC/Markit Purchasing Managers’ Index (PMI) showed yesterday, as new business rose at the fastest pace in three years. The headline PMI for last month was 53.5, up from 52.9 in April and well above the 50-point level that separates expansion from contraction. Last month was the fourth straight month of acceleration. The services sector has accounted for the bigger part of China’s economic output for at least two years, with its share rising to 48.2 percent last year, compared with the 42.6 percent contribution from manufacturing and construction.
ELECTRONICS
Fitbit predicts IPO funds
Fitbit Inc on Tuesday told US regulators that it might raise more than US$500 million when it makes its New York Stock Exchange debut, but remained silent as to when that would happen. The San Francisco-based company — known for wearable devices designed to promote healthy lifestyles by tracking activity — raised the high end of its target to US$549 million for the initial public offering (IPO), indicating in a filing that shares would be priced between US$14 and US$16 each. Based on the proposed share pricing, Fitbit would have a market value in the range of US$2.9 billion to US$3.3 billion given the number of shares it expects to sell.
JAPAN
Bankruptcies tipped to rise
Corporate bankruptcies linked to the yen’s slide might accelerate a few months from now, reflecting the latest rapid drop in the currency, Teikoku Databank Ltd researcher Osamu Naito said. While overall corporate bankruptcies decreased in the fiscal year through March, there has been an increase in company failures linked to the yen’s depreciation. It might accelerate from about August through the end of the year and has the potential to “trigger” an increase in the overall number of bankruptcies, Naito said. “Further weakness in the yen could become a matter of life and death for many small and medium-sized companies,” he said. There is typically a lag of three months to six months from the time a currency changes to the impact being felt in bankruptcies, Naito added.
SHIPPING
Maersk to buy vessels
Danish shipping giant A.P. Moeller-Maersk on Tuesday said that it had agreed to buy 11 “mega” container ships for US$1.8 billion with the option to acquire another six from South Korea’s Daewoo. Maersk Line, the world’s largest container transporter, said these vessels will help it stay competitive in the Asia-Europe trade and key in its strategy to grow with the market. The mega ships are 400m long and 58.6m wide and will each be capable of carrying more than 19,000 containers, it said.
SOCIAL MEDIA
Facebook opens Paris lab
Facebook Inc on Tuesday announced the opening of a new “artificial intelligence” lab in Paris to expand a push to make its online social network more profitable. The facility — the third after two it operates in the US — has six researchers at work and will more than double that number by the end of the year, executives from the US-based company said. The recruits are to come from France’s top public and private technological institutions.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
Apple Inc has been developing a homegrown chip to run artificial intelligence (AI) tools in data centers, although it is unclear if the semiconductor would ever be deployed, the Wall Street Journal reported on Monday. The effort would build on Apple’s previous efforts to make in-house chips, which run in its iPhones, Macs and other devices, according to the Journal, which cited unidentified people familiar with the matter. The server project is code-named ACDC (Apple Chips in Data Center) within the company, aiming to utilize Apple’s expertise in chip design for the company’s server infrastructure, the newspaper said. While this initiative has been
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that revenue would rise moderately in the second half of this year, driven primarily by robust demand for advanced wafers used in high-bandwidth memory (HBM) chips, a key component of artificial intelligence (AI) technology. “The first quarter is the lowest point of this cycle. The second half will be better than the first for the whole semiconductor industry and for GlobalWafers,” chairwoman Doris Hsu (徐秀蘭) said during an online investors’ conference. “HBM would definitely be the key growth driver in the second half,” Hsu said. “That is our big hope
The consumer price index (CPI) last month eased to 1.95 percent, below the central bank’s 2 percent target, as food and entertainment cost increases decelerated, helped by stable egg prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday. The slowdown bucked predictions by policymakers and academics that inflationary pressures would build up following double-digit electricity rate hikes on April 1. “The latest CPI data came after the cost of eating out and rent grew moderately amid mixed international raw material prices,” DGBAS official Tsao Chih-hung (曹志弘) told a news conference in Taipei. The central bank in March raised interest rates by