AUTOMAKERS
BMW may invest in CATL
BMW AG is the first overseas automaker to get a potential toehold in Chinese electric-car battery maker Contemporary Amperex Technology Co (CATL, 宇德時代), obtaining the right to make an equity investment of as much as 2.85 billion yuan (US$427 million) for an estimated 2 percent stake. BMW Brilliance (華晨寶馬汽車), its Chinese joint venture, is entitled to invest in CATL if the company plans to sell shares in China or abroad, according to a statement from the battery maker yesterday. BMW Brilliance will also prepay 2.85 billion yuan as part of a long-term contract to buy batteries from CATL. Additionally, it is purchasing an 815 million yuan battery-production project from the supplier to make designated products, according to the statement.
E-COMMERCE
Amazon sales a success
Amazon.com Inc’s sales rose sharply during the first three hours of its Prime Day sales event, dispelling fears that the technical glitches that incensed shoppers would significantly hurt business. Shoppers spent 54 percent more in the first three hours of this year’s event — from 3pm to 6pm — than in the first three hours of a year ago, when the shopping bonanza began at 9pm, according to Feedvisor, which sells software to set prices in e-commerce. Amazon’s annual 36-hour shopathon had been expected to drum up US$3.4 billion of spending. However, the e-commerce giant on Monday said that shoppers were having trouble on the site, while numerous customers vented their frustrations on social media with the hashtag #PrimeDayFail. Feedvisor’s estimates that the glitches limited sales in only the first hour of the event, when sales were down 5 percent before recovering in the second and third hours.
AUTOMAKERS
UK first-half sales fell 6.3%
UK car sales fell 6.3 percent during the first half of the year, running counter to rising demand on the continent, indicating the planned withdrawal from the EU is hurting consumer confidence. Business optimism last month dropped to the lowest level this year, as Britons became markedly more gloomy and unwilling to make purchases, according to separate indices on economic mood from Lloyds and Gfk. Overall new-car registrations across Europe rose 2.8 percent in the first six months, led by gains in France and Spain, according to figures released yesterday by the Brussels-based European Automobile Manufacturers’ Association. Germany, the largest market, also rose 2.9 percent.
E-COMMERCE
Pinduoduo plans IPO
Pinduoduo Inc (PDD, 拼多多), the Chinese e-commerce operator backed by Tencent Holdings (騰訊), plans to raise as much as US$1.6 billion in a US initial public offering (IPO) to bankroll a fight against rivals like Alibaba Group Holding (阿里巴巴). The Shanghai-based firm is offering 85.6 million American depositary shares at US$16 to US$19 apiece, it said in a stock exchange filing. PDD became one of China’s fastest-growing start-ups by creating a sort of Facebook-Groupon mashup that challenged the e-commerce duopoly of Alibaba Group Holding (京東). PDD, which has yet to turn a profit, popularized a format where people spot deals on products from fruit and clothing to toilet paper, then recruit friends to buy at a discount. It can offer savings of up to 20 percent on market prices by letting consumers buy directly from manufacturers, cutting out resellers and advertising.
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
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
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