TURKEY
Economy battling to recover
The economy slowed in the second quarter, but fared better than forecast, as the country’s recovery struggled to take hold at a time of political uncertainty. GDP expanded a seasonally adjusted 1.2 percent from the previous three months, according to data released yesterday, down from a revised 1.6 percent in the first quarter. From a year earlier, GDP shrank 1.5 percent. The slowdown in quarterly growth was driven by a slump in investments, which shrank 7.4 percent from the previous three-month period, a breakdown of GDP data by the Turkish Statistical Institute showed.
SOUTH KOREA
Export slump continues
Exports extended their slump last month as an escalating feud with Japan adds to uncertainties for the economy already elevated amid the US-China trade dispute. Exports fell 13.6 percent from a year earlier, a ninth consecutive month of contraction, data from the Ministry of Trade, Industry and Energy showed on Sunday. Imports fell 4.2 percent, and the trade surplus was US$1.7 billion, the ministry said. Shipments to China dropped 21.3 percent, a reflection of slowing growth in the world’s second-largest economy and South Korea’s biggest export destination. Semiconductor exports fell 30.7 percent by value, while volume was up 4.5 percent.
BANKING
Baring Vostok faces seizure
A court in Russia’s Far East ordered the seizure of a stake in Vostochny Bank held by private equity group Baring Vostok Capital Partners at Vostochny Bank’s request, court documents published yesterday showed. Baring Vostok has been in the spotlight since the arrest earlier this year of several of its executives, including US investor Michael Calvey, on embezzlement charges. They deny wrongdoing and say the case is being used against them in a corporate dispute over control of the bank. Vostochny Bank had requested the seizure of more than 334 billion shares held by a firm controlled by Baring Vostok.
FRANCE
Lottery to be privatized
The country aims to privatize its national lottery company, Francaise des Jeux (FDJ), in November, Minister of Finance Bruno Le Maire said on Sunday. The French state that controls 72 percent of FDJ, has said it plans to retain at least 20 percent of Europe’s second-biggest lottery operator following the sell-off, promised for this year. Le Maire said the privatization would most likely occur “during the month of November” barring any sharp stock-market downturn. He was speaking in an interview with CNEWS televsion, Europe 1 radio and daily Les Echos.
AVIATION
Norwegian Air asks for help
Budget airline Norwegian Air is asking bondholders to extend the maturity of its debt by up to two years, and would in return pledge valuable take-off and landing slots at London Gatwick Airport as security, it said yesterday. While the indebted carrier’s operational performance has improved since mid-July, the company’s working capital has decreased this year amid ongoing engine problems and the grounding of its fleet of Boeing MAX aircraft, it said. Norwegian’s bonds, which mature in December and August next year with a combined outstanding amount of US$380 million, would be extended to November 2021 and February 2022 if bondholders accept the revised terms.
Japanese technology giant Softbank Group Corp said Tuesday it has sold its stake in Nvidia Corp, raising US$5.8 billion to pour into other investments. It also reported its profit nearly tripled in the first half of this fiscal year from a year earlier. Tokyo-based Softbank said it sold the stake in Silicon Vally-based Nvidia last month, a move that reflects its shift in focus to OpenAI, owner of the artificial intelligence (AI) chatbot ChatGPT. Softbank reported its profit in the April-to-September period soared to about 2.5 trillion yen (about US$13 billion). Its sales for the six month period rose 7.7 percent year-on-year
CRESTING WAVE: Companies are still buying in, but the shivers in the market could be the first signs that the AI wave has peaked and the collapse is upon the world Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported a new monthly record of NT$367.47 billion (US$11.85 billion) in consolidated sales for last month thanks to global demand for artificial intelligence (AI) applications. Last month’s figure represented 16.9 percent annual growth, the slowest pace since February last year. On a monthly basis, sales rose 11 percent. Cumulative sales in the first 10 months of the year grew 33.8 percent year-on-year to NT$3.13 trillion, a record for the same period in the company’s history. However, the slowing growth in monthly sales last month highlights uncertainty over the sustainability of the AI boom even as
AI BOOST: Next year, the cloud and networking product business is expected to remain a key revenue pillar for the company, Hon Hai chairman Young Liu said Manufacturing giant Hon Hai Precision Industry Co (鴻海精密) yesterday posted its best third-quarter profit in the company’s history, backed by strong demand for artificial intelligence (AI) servers. Net profit expanded 17 percent annually to NT$57.67 billion (US$1.86 billion) from NT$44.36 billion, the company said. On a quarterly basis, net profit soared 30 percent from NT$44.36 billion, it said. Hon Hai, which is Apple Inc’s primary iPhone assembler and makes servers powered by Nvidia Corp’s AI accelerators, said earnings per share expanded to NT$4.15 from NT$3.55 a year earlier and NT$3.19 in the second quarter. Gross margin improved to 6.35 percent,
FAULTs BELOW: Asia is particularly susceptible to anything unfortunate happening to the AI industry, with tech companies hugely responsible for its market strength The sudden slump in Asia’s technology shares last week has jolted investors, serving as a stark reminder that the world-beating rally in artificial intelligence (AI) and semiconductor stocks might be nearing a short-term crest. The region’s sharpest decline since April — triggered by a tech-led sell-off on Wall Street — has refocused attention on cracks beneath the surface: the rally’s narrow breadth, heavy reliance on retail traders, and growing uncertainty around the timing of US Federal Reserve interest-rate cuts. Last week’s “sell-off is a reminder that Asia’s market structure is just more vulnerable,” Saxo Markets chief investment strategist Charu Chanana said in
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