EQUITIES
Easing fears boost shares
Local shares yesterday closed higher and the TAIEX moved closer to 10,900 points as market sentiment improved amid easing fears over trade tensions between the US and China. While select large-cap technology shares attracted buying, in particular in the late trading session, the petrochemical sector got a significant boost on the back of a spike in international crude oil prices caused by a production cut in Saudi Arabia after drone attacks on the nation’s production facilities. The TAIEX closed up 70.58 points, or 0.65 percent, at the day’s high of 10,898.13, on turnover of NT$116.551 billion (US$3.76 billion). Foreign institutional investors bought a net NT$8.89 billion of shares on the main board, Taiwan Stock Exchange data showed.
EQUITIES
Revenues fall 2.66%
Companies listed on the Taiwan Stock Exchange last month posted combined revenue of NT$2.76 trillion, a 2.66 percent decline from a year earlier, Taiwan Stock Exchange data showed. Of the listed firms, 412 reported year-on-year sales increases, while 522 reported declines, the exchange said. Firms that posted increases were mainly in the information services and semiconductor sectors, while those that posted declines were in the electrical cables, building materials, and oil and gas services sectors, it said.
AVIATION
Tigerair planning to recruit
Low-cost airline Tigerair Taiwan Ltd (台灣虎航) yesterday said it plans to recruit 50 new flight attendants by the end of this year to meet the increased demand. The 50 crew members would go on duty in February next year after completing their training, it said. The airline currently has 200 flight attendants, one-third of whom are male, the highest ratio among all local airlines. Tigerair Taiwan spokesman Bernard Hsu (許致遠) said the company plans to apply for new routes after expanding its fleet in 2021 and aims to debut its shares on Taipei Exchange by the end of this year.
DAIRY PRODUCERS
Mengniu bids for Bellamy’s
China Mengniu Dairy Co (中國蒙牛乳業) yesterday announced that it has made a takeover offer for infant formula producer Bellamy’s Australia Ltd for about US$1 billion. Under the proposed deal, Mengniu would pay A$12.65 (US$8.69) per Bellamy’s share plus a dividend, a 59 percent premium on the closing price on Friday last week. Bellamy’s chief executive Andrew Cohen said that Mengniu had offered a “strong platform for distribution and success in China.” The board of directors at the Australian group have given their support to the takeover bid, which needs the approval of the company’s shareholders and the Australian Foreign Investment Review Board.
STOCK MARKETS
Beijing praises LSE rebuff
Hong Kong Exchanges & Clearing Ltd’s (HKEX) unsolicited takeover bid for London Stock Exchange Group PLC (LSE) suffered a further setback after Beijing praised the British firm’s scathing rebuff. The People’s Daily on Saturday wrote that there are “persistent worries” about Hong Kong given the current unrest and lauded the LSE for citing its existing tie-up with the Shanghai Stock Exchange as its preferred way to access China. Meanwhile, British Financial Conduct Authority chief executive Andrew Bailey yesterday promised tough scrutiny of HKEX if it presses forward with its bid due to the significance of the British exchange.
Three experts in the high technology industry have said that US President Donald Trump’s pledge to impose higher tariffs on Taiwanese semiconductors is part of an effort to force Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to the negotiating table. In a speech to Republicans on Jan. 27, Trump said he intends to impose tariffs on Taiwan to bring chip production to the US. “The incentive is going to be they’re not going to want to pay a 25, 50 or even a 100 percent tax,” he said. Darson Chiu (邱達生), an economics professor at Taichung-based Tunghai University and director-general of
‘LEGACY CHIPS’: Chinese companies have dramatically increased mature chip production capacity, but the West’s drive for secure supply chains offers a lifeline for Taiwan When Powerchip Technology Corp (力晶科技) entered a deal with the eastern Chinese city of Hefei in 2015 to set up a new chip foundry, it hoped the move would help provide better access to the promising Chinese market. However, nine years later, that Chinese foundry, Nexchip Semiconductor Corp (合晶集成), has become one of its biggest rivals in the legacy chip space, leveraging steep discounts after Beijing’s localization call forced Powerchip to give up the once-lucrative business making integrated circuits for Chinese flat panels. Nexchip is among Chinese foundries quickly winning market share in the crucial US$56.3 billion industry of so-called legacy
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
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