INVESTMENTS
Investors ditch biggest ETF
Investors abandoned the world’s biggest passive fund during the onset of market mayhem last week as the SPDR S&P 500 exchange-traded fund (ETF) suffered a record US$23.6 billion in outflows amid the worst momentum swing in history for the underlying US equity benchmark. Outflows amounted to 8 percent of the fund’s total assets at the start of the week, a rate of withdrawals not seen since August 2010. A blowup in volatility-linked products sent markets haywire, eliciting waves of risk aversion from jittery investors. The combination of price declines and withdrawals erased US$38.6 billion in the fund’s assets. That is nearly double the second-worst showing of US$19.4 billion in asset shrinkage during the week ending Aug. 21, 2015, when China’s surprise devaluation of the yuan roiled markets.
AUTO PARTS
Takata reaches deal in US
Takata Corp’s US unit has reached a settlement with representatives of those injured by lethally defective air bags, paving the way for the company to exit Chapter 11 bankruptcy and move forward with a reorganization plan. The agreement between the Japanese auto parts supplier, injured drivers and creditors, was outlined in documents filed on Saturday in a Delaware bankruptcy court. Two groups representing people suing over the air bags have dropped their opposition to the plan. Under the settlement, a trust fund is to be established to resolve the lawsuits.
BEVERAGES
Heineken to miss target
Heineken NV, the world’s second-largest brewer, forecast that profitability this year will be below its medium-term target as it integrates a Brazilian business it bought from Japanese rival Kirin Holdings Co. The operating profit margin will expand about 25 basis points this year as sales gain, the brewer said in a statement yesterday. Volume growth was led by Asia-Pacific, where Vietnam is one of Heineken’s largest markets. Heineken’s medium-term target is for a 40 basis-point increase in profitability each year, excluding acquisitions and unforeseen events. Revenue last year rose 5 percent on a so-called organic basis, the company said.
UNITED KINGDOM
House prices decline
House prices recorded an annual drop for the first time in almost six years at the start of this year, with London leading the slump. Values last month fell 0.4 percent compared with a year earlier, according to a report published yesterday by Acadata. Detailed data covering the fourth quarter of last year showed London fell 4.3 percent — the most since the depths of the recession in 2009. Comparing last month to December last year, values rose 0.2 percent, the first monthly increase since September last year. That left the average at £301,477 (US$416,000). In London, the average is £589,553.
CRYPTOCURRENCIES
Bitcoin recovers after rout
Bitcoin yesterday clawed its way back from the four-month low of US$5,922 it touched on Tuesday last week, rebounding 53 percent to US$9,069. Bitcoin’s supporters were quick to extol the cryptocurrency’s virtues as an asset that is uncorrelated to the broader market — independent from any single country, company or central bank — which can serve as a haven in times of market turmoil. The “do no harm” approach to cryptocurrencies taken by US regulators at a US Senate hearing on Tuesday last week sparked the rebound.
Nearly half of China’s major cities are suffering “moderate to severe” levels of subsidence, putting millions of people at risk of flooding, especially as sea levels rise, according to a study of nationwide satellite data released yesterday. The authors of the paper, published by the journal Science, found that 45 percent of China’s urban land was sinking faster than 3mm per year, with 16 percent at more than 10mm per year, driven not only by declining water tables, but also the sheer weight of the built environment. With China’s urban population already in excess of 900 million people, “even a small portion
UNSETTLING IMAGES: The scene took place in front of TV crews covering the Trump trial, with a CNN anchor calling it an ‘emotional and unbelievably disturbing moment’ A man who doused himself in an accelerant and set himself on fire outside the courthouse where former US president Donald Trump is on trial has died, police said yesterday. The New York City Police Department (NYPD) said the man was declared dead by staff at an area hospital. The man was in Collect Pond Park at about 1:30pm on Friday when he took out pamphlets espousing conspiracy theories, tossed them around, then doused himself in an accelerant and set himself on fire, officials and witnesses said. A large number of police officers were nearby when it happened. Some officers and bystanders rushed
HYPOCRISY? The Chinese Ministry of Foreign Affairs yesterday asked whether Biden was talking about China or the US when he used the word ‘xenophobic’ US President Joe Biden on Wednesday called for a hike in steel tariffs on China, accusing Beijing of cheating as he spoke at a campaign event in Pennsylvania. Biden accused China of xenophobia, too, in a speech to union members in Pittsburgh. “They’re not competing, they’re cheating. They’re cheating and we’ve seen the damage here in America,” Biden said. Chinese steel companies “don’t need to worry about making a profit because the Chinese government is subsidizing them so heavily,” he said. Biden said he had called for the US Trade Representative to triple the tariff rates for Chinese steel and aluminum if Beijing was
Beijing is continuing to commit genocide and crimes against humanity against Uyghurs and other Muslim minorities in its western Xinjiang province, U.S. Secretary of State Antony Blinken said in a report published on Monday, ahead of his planned visit to China this week. The State Department’s annual human rights report, which documents abuses recorded all over the world during the previous calendar year, repeated language from previous years on the treatment of Muslims in Xinjiang, but the publication raises the issue ahead of delicate talks, including on the war in Ukraine and global trade, between the top U.S. diplomat and Chinese