AUTOPARTS
Takata trade suspended
Shares in Takata Corp were suspended in early trade after the Nikkei business daily reported that the airbag maker was preparing for a possible bankruptcy protection filing of its US unit as recall costs rise. However, Takata said it “has not made any decision nor has facts to be disclosed,” concerning the matter and added there was no new decision since a similar news report last month. The company’s shares eventually resumed trading, closing down 1.74 percent at ￥337, an almost six-month low. Regulators have ordered recalls scheduled into 2019 that could eventually exceed 100 million air bags used by more than a dozen automakers. Potential suitors proposed bankruptcy for Takata’s US unit at meetings with automakers in New York last week.
AUTOMAKERS
BMW Q3 profit rises 1.1%
BMW AG’s third-quarter profit rose 1.1 percent as demand for its sport utility vehicles propelled sales in Europe and China, offsetting a slump in the US. Earnings before interest and taxes climbed from 2.35 billion euros a year earlier to 2.38 billion euros (US$2.61 billion to US$2.64 billion), the Munich-based company said in a statement yesterday. The company repeated that sales and pretax profit at its automotive unit would post “slight increases” this year. Global sales of BMW’s namesake marque rose 6 percent in the year through to September to 1.48 million vehicles, growing at only half the rate of Mercedes, according to data published last month.
BEVERAGES
Starbucks bucks industry trend
Starbucks Corp posted earnings that topped analysts’ estimates as new food items and digital efforts like mobile ordering helped its US business defy a restaurant-industry slowdown. The world’s largest coffee-shop operator said its profit rose to US$0.56 a share, excluding some items, in the most recent quarter. That topped analysts’ average prediction of US$0.55. Globally, same-store sales rose 4 percent. Analysts had projected 4.8 percent. Sales by that measure increased 1 percent in the China and Asia-Pacific unit, and fell 1 percent in Europe, the Middle East and Africa.
AVIATION
Singapore Air to be vigilant
Singapore Airlines Ltd said it would be vigilant on costs as it warned yet again that the weak operating outlook is likely to persist amid excess capacity and aggressive pricing by competitors. The prospects in most major economies remain “tepid,” while passenger airline business continued to be impacted by geopolitical uncertainty and weak global economic conditions, Singapore Air said on Thursday. The premium carrier reported its first quarterly slump in two years, saying passenger and cargo yields — a key measure of profitability in the industry — continue to be under stress.
INDIA
Bonds sales hit record high
Indian companies are selling record amounts of rupee bonds to individuals, tapping savers dissatisfied with deposit rates at decade lows. Debt offerings to the public by companies surged to 239 billion rupees (US$3.6 billion) in the seven months from April through last month, up sixfold from the year-earlier period and the fastest pace on record, Securities & Exchange Board of India data showed. About 94 percent of the 239 billion rupees raised through the public market in the April to October period was by first time issuers.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading
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