JAPAN
Machinery orders down
Machinery orders in May fell for the first time since January and at a faster rate than expected, casting doubt on the strength of capital investment over the coming months amid a global economic slowdown. Core machinery orders, a leading indicator of capital expenditure, in May fell 7.8 percent from April, its biggest fall in eight months, Cabinet Office data showed yesterday. Orders slipped 3.7 percent from the previous year. The latest data show that machine orders fell in both the manufacturing and non-manufacturing sectors.
CHINA
Forex holdings increase
Foreign-currency holdings rose for a second month amid potential capital inflows and positive valuation effects, hitting the highest level in more than a year. Reserves last month climbed to US$3.119 trillion from US$3.101 trillion in May, the People’s Bank of China said yesterday. The value of reserves rose due to a weaker US dollar and higher international financial asset prices, the State Administration of Foreign Exchange said in a statement.
TECHNOLOGY
Broadcom prepared to buy
Broadcom Inc has secured financing and identified cost savings for the acquisition of Symantec Corp in an all-cash deal, people familiar with the matter said. The chipmaker received lending commitments from several banks and sees annual synergy potential of about US$1.5 billion, the people said. Separately, Symantec has drawn interest from its former chief executive officer Greg Clark, who has teamed up with buyout firms Advent International and Permira Holdings in an attempt to muster a competing offer, the people said.
INDIA
Effect of tax hike negligible
The government’s decision to raise duties on gasoline and diesel is unlikely to threaten the inflation outlook, keeping alive expectations of more interest rate cuts from the central bank. Minister of Finance Nirmala Sitharaman’s decision on Friday to increase federal taxes on transport fuels by 2 rupees ($US0.17) a liter would have an impact of less than 10 basis points on headline inflation, Nirmal Bang Equities Pvt economist Teresa John said. The second-round effects could push up the inflation rate by slightly more than 10 basis points.
CHINA
Vehicle sales recover
Passenger-vehicle sales showed signs of recovery from a historic rut as dealers offered discounts to clear inventory before new emissions rules kicked in. Retail sales of sedans, sport utility vehicles, minivans and multipurpose vehicles last month rose 4.9 percent to 1.8 million units from a year earlier, according to preliminary numbers from the China Passenger Car Association yesterday. That is the first increase since May last year for the world’s biggest market.
AVIATION
Flyadeal scraps MAX deal
Saudi Arabian budget carrier Flyadeal reversed a commitment to buy as many as 50 Boeing Co 737 MAX jets, becoming the first airline to officially drop the aircraft since its grounding following two deadly crashes. Flyadeal would operate an entirely Airbus SE fleet, the company said in a statment on Sunday, taking as many as 50 A320neo-family airplanes from Boeing’s European rival. Flyadeal is to take delivery starting 2021 of 30 Airbus A320neo aircraft, with an option for an additional 20 aircraft from the A320neo family.
SUPPORT: The government said it would help firms deal with supply disruptions, after Trump signed orders imposing tariffs of 25 percent on imports from Canada and Mexico The government pledged to help companies with operations in Mexico, such as iPhone assembler Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), shift production lines and investment if needed to deal with higher US tariffs. The Ministry of Economic Affairs yesterday announced measures to help local firms cope with the US tariff increases on Canada, Mexico, China and other potential areas. The ministry said that it would establish an investment and trade service center in the US to help Taiwanese firms assess the investment environment in different US states, plan supply chain relocation strategies and
Hon Hai Precision Industry Co (鴻海精密) is reportedly making another pass at Nissan Motor Co, as the Japanese automaker's tie-up with Honda Motor Co falls apart. Nissan shares rose as much as 6 percent after Taiwan’s Central News Agency reported that Hon Hai chairman Young Liu (劉揚偉) instructed former Nissan executive Jun Seki to connect with French carmaker Renault SA, which holds about 36 percent of Nissan’s stock. Hon Hai, the Taiwanese iPhone-maker also known as Foxconn Technology Group (富士康科技集團), was exploring an investment or buyout of Nissan last year, but backed off in December after the Japanese carmaker penned a deal
WASHINGTON POLICY: Tariffs of 10 percent or more and other new costs are tipped to hit shipments of small parcels, cutting export growth by 1.3 percentage points The decision by US President Donald Trump to ban Chinese companies from using a US tariff loophole would hit tens of billions of dollars of trade and reduce China’s economic growth this year, according to new estimates by economists at Nomura Holdings Inc. According to Nomura’s estimates, last year companies such as Shein (希音) and PDD Holdings Inc’s (拼多多控股) Temu shipped US$46 billion of small parcels to the US to take advantage of the rule that allows items with a declared value under US$800 to enter the US tariff-free. Tariffs of 10 percent or more and other new costs would slash such
SENSOR BUSINESS: The Taiwanese company said that a public tender offer would begin on May 7 through its wholly owned subsidiary Yageo Electronics Japan Yageo Corp (國巨), one of the world’s top three suppliers of passive components, yesterday said it is to launch a tender offer to fully acquire Japan’s Shibaura Electronics Co for up to ¥65.57 billion (US$429.37 million), with an aim to expand its sensor business. The tender offer would be a crucial step for the company to expand its sensor business, Yageo said. Shibaura Electronics is the world’s largest supplier of thermistors, with a market share of 13 percent, research conducted in 2022 by the Japanese firm showed. If a deal goes ahead, it would be the second acquisition of a sensor business since