■ Yuanta may buy company
Yuanta Core Pacific Securities Co (元大京華證券), Taiwan's largest brokerage, said it may take over a financial holding company, giving it a license to lend, sell insurance, manage assets and bid for other financial institutions.
"There are two possible targets among the 14 financial holding companies" in Taiwan, Yuanta President and Managing Director Lee Chang (張立秋) said. Chang declined to identify the two companies or give a timeframe for any purchase.
Yuanta is also looking to expand in South Korea. The brokerage was chosen as a preferred bidder to buy LG Investment & Securities Co, Korea Development Bank, the sale's arranger, said last month. LG Investment is Korea's second-largest brokerage.
Chang said the company plans to pay cash for LG Investment, declining to say how much it's prepared to bid for the brokerage.
■ Foreign funds flee Taiwan
Overseas investors sold more Taiwan stocks than they bought in May on concerns about rising oil prices and possible interest rate increases. There was a net outflow of funds for the first time in 15 months.
The Securities and Futures Commission said net sales of shares by foreign investors totaled NT$76.3 billion (US$2.3 billion).
"Net outflows of foreign funds were even larger at US$3.1 billion in May, the first since February last year," said Huang Yun-chih, a division chief at the commission, clarifying local newspaper reports that net fund outflows in May totaled US$3.6 billion.
Analysts had attributed the outflow to recent oil price surges, possible interest rate increases, terror attacks in the Middle East and well as China's moves to slow its overheated economy.
■ Formosa Plastics head in China
Formosa Plastics Group (台塑) Chairman Wang Yung-chin (王永慶) is currently visiting China and is probably inspecting a petrochemical zone in southeastern China, an executive said yesterday.
Wang's trip comes at a sensitive time with China stepping up verbal attacks on Taiwan businessmen, especially Chi Mei Group Chairman Hsu Wen-lung(許文龍).
The 87-year-old tycoon, who departed Wednesday, is expected to return to Taiwan Monday. He is probably inspecting the petrochemical zone in Ningpo, Zhejiang province, the executive said.
■ Buy NT dollar: Merrill Lynch
Merrill Lynch & Co recommends that investors buy the New Taiwan dollar, Thai baht and Chinese yuan on expectations China will try to engineer a gradual economic slowdown, maintaining demand for the region's exports.
"We expect growth and inflation in China to surprise on the upside over the course of the year, with positive implications for the regional economy," Hong Kong-based chief Asia-Pacific economist T.J. Bond and Vincent Low, foreign-exchange strategist in Singapore, wrote in the report.
Expectations of rising consumer prices in Taiwan and Thailand may prompt "policy tightening" in the form of higher domestic interest rates or a stronger currency, they wrote.
By contrast, the "considerable slack" in US product and labor markets will help curb inflationary pressures and lower expectations of an interest rate increase by the Federal Reserve, the report said.
■ NT dollar loses ground
The New Taiwan dollar yesterday continued to lose ground against its US counterpart, reflecting hopes that key oil producers would raise output in a bid to help curb record oil prices, dealers said.
The NT dollar dropped NT$0.032 to close at NT$33.591 against the greenback on the Taipei foreign exchange market, on a turnover of US$546 million.
POOR INTERNAL CONTROLS: Insurance Bureau Director-General Shih Chiung-hwa said the company is expected to get back on track while its chairman is suspended The Financial Supervisory Commission (FSC) yesterday fined Shin Kong Life Insurance Co (新光人壽) NT$27.6 million (US$939,415) for a reckless investment that endangered its solvency, and suspended its chairman Eugene Wu (吳東進) for poor supervision. The penalty is the second-highest in a single case after Nan Shan Life Insurance Co (南山人壽) was fined NT$30 million in September last year and its chairman Du Ying-tzyong (杜英宗) suspended for two years, the commission said. In three rounds of special and regular examinations conducted since last year, the commission found that Shin Kong Life had given too much power to an asset and liability management committee
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Continental AG, which makes control units for Daimler AG cars, cannot pursue antitrust claims against a group of patent owners, including Qualcomm Inc, which are seeking royalties on telecommunications technology, a federal judge in Texas ruled. Avanci LLC, a licensing pool formed by Qualcomm, Nokia Oyj, Sharp Corp and other owners of patents on technology standards, is not breaching antitrust laws when it negotiates license agreements with automakers rather than the component makers, Barbara Lynn, chief district judge for the Northern District of Texas, said in dismissing the suit in a decision posted on Friday. The licensing group charges US$15 per vehicle
Sony Corp has cut its estimated Play Station 5 (PS5) production for this fiscal year by 4 million units, down to about 11 million, following production issues with its custom-designed system-on-chip (SOC) for the new console, people familiar with the matter said. The Tokyo-based electronics giant in July boosted orders with suppliers in anticipation of heightened demand for gaming in the holiday season and beyond, as people spend more time at home due to the COVID-19 pandemic. However, the company has come up against manufacturing issues, such as production yields as low as 50 percent for its SOC, which have cut into