STOCK MARKETS
HK regulator gives life ban
Hong Kong’s Securities and Futures Commission said it banned former Credit Suisse Group AG trader Jagjit Singh Dhillon from the industry for life after he made fictitious trades and covered up losses in 2012. Dhillon, who traded equity derivatives, took steps to hide losses and his true exposure to risk in his trading books between May 8 and May 17, 2012, booked fictitious trades and entered incorrect market data, the regulator said on its Web site yesterday. The trader’s actions led to overstated profits and understated risk exposure, resulting in Credit Suisse having to make US$5.4 million in adjustments to the cumulative monthly profit and loss figure for its trading book on May 18, 2012, the regulator said.
STOCK MARKETS
China to start option trades
China will start trading its first stock options next month, according to the securities regulator, with state media saying yesterday that the move could cause greater market volatility. The Shanghai Stock Exchange will begin offering options on an exchange-traded fund starting on Feb. 9, the China Securities Regulatory Commission (CSRC) said in a statement, which described the launch as a “trial.” “The trial of stock options ... is of great significance to promoting the healthy development and enhancing the global competitiveness of China’s capital markets,” it said in the statement on Friday. However, the move might bring more volatility, state media said, in a stock market dominated by retail investors. Separately, the 21st Century Business Herald said options would benefit the market in the long run by helping investors hedge against risk and discover value investing.
REAL ESTATE
Singapore rates raise prices
A sudden new-year jump in Singapore interest rates threatens to push up mortgage costs and steepen a slide in home prices. The three-month Singapore interbank offered rate, against which most home loans are benchmarked, has risen 18 basis points to 0.6392 percent this year, the highest since April 2010, driven by a stronger US dollar and new liquidity requirements for Singapore banks. Short-term interest rates might head toward 1 percent this year, as a resurgent US economy could spur the US Federal Reserve to raise borrowing costs, according to United Overseas Bank Ltd and Maybank Kim Eng Research Pte. Singapore, which has S$177 billion (US$132 billion) of outstanding mortgage debt, posted a 4 percent drop in home prices last year. Home prices may fall a further 10 percent by the middle of next year, while short-term interest rates could top 1 percent this year, more than double last year’s level, said Vishnu Varathan, an economist at Mizuho Bank Ltd in Singapore
AUTOMAKERS
China car sales to top 25.1m
China’s vehicle sales are forecast to expand 7 percent this year, as the economy cools in the world’s largest car market. Total deliveries may exceed 25.1 million vehicles, from 23.5 million last year, the state-backed China Association of Automobile Manufacturers (中國汽車工業協會) said in Beijing yesterday. That compares with 6.9 percent growth last year and 14 percent in 2013, with the market continuing to add the equivalent of an entire year’s auto sales in some smaller developed markets, such as France or South Korea. Ford Motor Co, General Motors Co and Volkswagen AG each reported record Chinese vehicle deliveries last year, despite economic growth easing to the slowest pace since 1990.
PROTECTIONISM: China hopes to help domestic chipmakers gain more market share while preparing local tech companies for the possibility of more US sanctions Beijing is stepping up pressure on Chinese companies to buy locally produced artificial intelligence (AI) chips instead of Nvidia Corp products, part of the nation’s effort to expand its semiconductor industry and counter US sanctions. Chinese regulators have been discouraging companies from purchasing Nvidia’s H20 chips, which are used to develop and run AI models, sources familiar with the matter said. The policy has taken the form of guidance rather than an outright ban, as Beijing wants to avoid handicapping its own AI start-ups and escalating tensions with the US, said the sources, who asked not to be identified because the
Taipei is today suspending its US$2.5 trillion stock market as Super Typhoon Krathon approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed-income trading, statements from its stock and currency exchanges said. Yesterday, schools and offices were closed in several cities and counties in southern and eastern Taiwan, including in the key industrial port city of Kaohsiung. Taiwan, which started canceling flights, ship sailings and some train services earlier this week, has wind and rain advisories in place for much of the island. It regularly experiences typhoons, and in July shut offices and schools as
FALLING BEHIND: Samsung shares have declined more than 20 percent this year, as the world’s largest chipmaker struggles in key markets and plays catch-up to rival SK Hynix Samsung Electronics Co is laying off workers in Southeast Asia, Australia and New Zealand as part of a plan to reduce its global headcount by thousands of jobs, sources familiar with the situation said. The layoffs could affect about 10 percent of its workforces in those markets, although the numbers for each subsidiary might vary, said one of the sources, who asked not to be named because the matter is private. Job cuts are planned for other overseas subsidiaries and could reach 10 percent in certain markets, the source said. The South Korean company has about 147,000 in staff overseas, more than half
Her white-gloved, waistcoated uniform impeccable, 22-year-old Hazuki Okuno boards a bullet train replica to rehearse the strict protocols behind the smooth operation of a Japanese institution turning 60 Tuesday. High-speed Shinkansen trains began running between Tokyo and Osaka on Oct. 1, 1964, heralding a new era for rail travel as Japan grew into an economic superpower after World War II. The service remains integral to the nation’s economy and way of life — so keeping it dazzlingly clean, punctual and accident-free is a serious job. At a 10-story, state-of-the-art staff training center, Okuno shouted from the window and signaled to imaginary colleagues, keeping
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