VIETNAM
Central bank calms market
The State Bank of Vietnam yesterday sought to calm markets after investors sold financial stocks, and customers of the nation’s fifth-largest commercial bank raced to withdraw their savings following a police probe into a prominent real-estate tycoon. The benchmark index and bank stocks plunged after police over the weekend announced the detention of Truong My Lan, chairwoman of Van Thinh Phat Holdings Group, and other company officials for allegedly obtaining property through fraudulent means. The move was in relation to an investigation into the issuance and trading of bonds in which vast sums of currency were allegedly appropriated in 2018 and 2019.
SINGAPORE
MAS urges greater scrutiny
The Monetary Authority of Singapore (MAS) yesterday urged asset managers to ramp up pressure and scrutiny on environmental, social and corporate governance issues in their portfolio companies. “We encourage institutional investors to take the lead in exercising responsible investor stewardship,” MAS Deputy Managing Director Ho Hern Shin (何亨申) said at a corporate governance conference. This could be done through engagement with companies and proxy voting, she added. On pay transparency, Ho said it was “concerning” that most listed companies do not adhere to laws requiring disclosure of how much their CEOs and directors are paid.
AUTOMAKERS
Renault in Nissan sale talk
Renault SA’s stock surged after the automaker confirmed talks that could lead to the French company cashing in some of its 6.1 billion euros (US$5.9 billion) of shares in alliance partner Nissan Motor Co. The stock rose as much as 6.6 percent as of 9:30am yesterday in Paris after Renault said that it was discussing several initiatives with Nissan. The talks include the Japanese manufacturer potentially investing in the new electric vehicle entity that Renault is planning to create. People familiar with the matter said that as part of these talks, Renault is open to reducing it stake in Nissan, a prospect that has been cheered by several analysts.
ENERGY
Energean gas flow tests start
Energean PLC has begun pumping gas to its floating production facility in the offshore Karish gas field as part of reverse flow testing procedures approved by the Israeli government, the London-listed energy group said on Sunday. The testing phase is an important step in the commissioning process of the so-called FPSO Energean Power facility, it said. The development of the Karish field, about 80km west of the Israeli city of Haifa, has raised tensions between Israel and Lebanon in their protracted dispute over maritime boundaries. The US has been mediating indirect talks on the issue since 2020.
FINANCE
Auto debt market risks high
Ark Investment Management LLC founder and CEO Cathie Wood yesterday flagged the risk of “serious losses” in the trillion-dollar auto debt market, after statistics showed that used vehicle prices in the US decreased last month. Writing on Twitter, Wood cited a shift in consumer tastes toward electric vehicles as leading to a drop in the price of gasoline-powered vehicles. Wood also posted data released by Manheim Auctions, the world’s largest reseller of used vehicles. That organization’s US Used Vehicle Value Index showed a 3 percent drop last month from August.
ADVANCED: Previously, Taiwanese chip companies were restricted from building overseas fabs with technology less than two generations behind domestic factories Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp, would no longer be restricted from investing in next-generation 2-nanometer chip production in the US, the Ministry of Economic Affairs said yesterday. However, the ministry added that the world’s biggest contract chipmaker would not be making any reckless decisions, given the weight of its up to US$30 billion investment. To safeguard Taiwan’s chip technology advantages, the government has barred local chipmakers from making chips using more advanced technologies at their overseas factories, in China particularly. Chipmakers were previously only allowed to produce chips using less advanced technologies, specifically
The New Taiwan dollar is on the verge of overtaking the yuan as Asia’s best carry-trade target given its lower risk of interest-rate and currency volatility. A strategy of borrowing the New Taiwan dollar to invest in higher-yielding alternatives has generated the second-highest return over the past month among Asian currencies behind the yuan, based on the Sharpe ratio that measures risk-adjusted relative returns. The New Taiwan dollar may soon replace its Chinese peer as the region’s favored carry trade tool, analysts say, citing Beijing’s efforts to support the yuan that can create wild swings in borrowing costs. In contrast,
TARIFF SURGE: The strong performance could be attributed to the growing artificial intelligence device market and mass orders ahead of potential US tariffs, analysts said The combined revenue of companies listed on the Taiwan Stock Exchange and the Taipei Exchange for the whole of last year totaled NT$44.66 trillion (US$1.35 trillion), up 12.8 percent year-on-year and hit a record high, data compiled by investment consulting firm CMoney showed on Saturday. The result came after listed firms reported a 23.92 percent annual increase in combined revenue for last month at NT$4.1 trillion, the second-highest for the month of December on record, and posted a 15.63 percent rise in combined revenue for the December quarter at NT$12.25 billion, the highest quarterly figure ever, the data showed. Analysts attributed the
Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) quarterly sales topped estimates, reinforcing investor hopes that the torrid pace of artificial intelligence (AI) hardware spending would extend into this year. The go-to chipmaker for Nvidia Corp and Apple Inc reported a 39 percent rise in December-quarter revenue to NT$868.5 billion (US$26.35 billion), based on calculations from monthly disclosures. That compared with an average estimate of NT$854.7 billion. The strong showing from Taiwan’s largest company bolsters expectations that big tech companies from Alphabet Inc to Microsoft Corp would continue to build and upgrade datacenters at a rapid clip to propel AI development. Growth accelerated for
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