UNITED STATES
Survey suggests easing
JPMorgan Chase & Co said the Treasury market is acting like the US Federal Reserve is more likely to ease policy than to tighten. The bank’s client survey showed 75 percent of respondents were neutral on the bond market, a five-year high. Curiously, the poll has only favored neutrality to such an extent on 22 occasions in its 26-year history. “Every other instance has occurred just prior to or during a Fed easing regime,” JPMorgan said. “Investors appear to be de-risking as geopolitical tensions have risen and in anticipation of domestic fiscal issues, which could further contribute to uncertainty in September.” Yields on 10-year Treasuries dropped to a nine-month low of 2.08 percent this week, as North Korea lobbed missiles over Japan.
MINING
Sibanye not paying dividend
Sibanye Gold Ltd said it would not pay an interim dividend for the first time since it began trading in 2013, as the biggest producer of South African gold reported a first-half loss. The results in the six months through June were affected by a big impairment charge on unprofitable mines it plans to close, provision for a settlement in a lung disease class-action lawsuit and financing costs following its US$2.2 billion purchase of US platinum-group metals producer Stillwater Mining Co. Sibanye’s net debt following the Stillwater deal rose to US$1.69 billion at the end of June.
BANKING
ICBC’s Q2 profits rise 2.3%
Industrial & Commercial Bank of China Ltd (ICBC, 中國工商銀行) the world’s largest lender by assets, reported a 2.3 percent gain in second-quarter profit as it reined in bad loans. Net income for the three months through June rose to 77.2 billion yuan (US$11.7 billion), from 75.45 billion yuan a year earlier, according to quarterly figures derived from first-half earnings ICBC reported to Hong Kong’s stock exchange yesterday. China’s economic recovery has helped fuel loan growth at the four biggest banks, which together control about one-third of the nation’s US$36 trillion of banking assets.
BANKING
Berkshire buys BoA shares
Warren Buffett’s Berkshire Hathaway Inc exercised warrants to buy 700 million shares of Bank of America Corp (BoA), locking in an US$11.5 billion investment gain in a move that was telegraphed earlier this year. Buffett invested US$5 billion in the bank in 2011, in exchange for preferred stock and the right to buy common shares. The cash infusion helped the bank put to rest doubts about whether it had enough capital and its shares have more than tripled since then.
ENERGY
Petrofac earnings fall 10.7%
British oilfield services company Petrofac Ltd yesterday reported a 10.7 percent fall in core earnings for the first-half, as subdued oil prices forced exploration and drilling companies to defer or cancel service contracts. The order backlog stood at US$12.5 billion as of June 30, said the company, which designs, builds, operates and maintains oil and gas facilities. Earnings before interest, tax, depreciation and amortization fell to US$323 million for the first half ended June 30. Revenue for the half year fell about 20 percent to US$3.13 billion. Petrofac also declared a dividend of US$12.7 per share for the half year, a reduction of 42 percent compared to last year.
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