|Bid||9.980 x 0|
|Ask||9.990 x 0|
|Day's range||9.820 - 10.100|
|52-week range||9.270 - 14.140|
|Beta (3Y monthly)||0.72|
|PE ratio (TTM)||16.74|
|Forward dividend & yield||0.38 (3.70%)|
|1y target est||14.01|
(Bloomberg) -- Hong Kong police deployed water cannons for the first time, fired multiple volleys of tear gas and at least two officers drew weapons in running skirmishes with protesters in the 12th weekend of unrest in the Asian financial center.Police and protesters were involved in several standoffs in the western New Territories district of Tsuen Wan on Sunday afternoon. On Saturday, Hong Kong Chief Executive Carrie Lam held a meeting with former officials and other prominent people to find a way out of the impasse that has rocked the former British colony.The return to violence followed large but peaceful protests last weekend. On Friday, protesters formed a human chain across the city, while a plan to disrupt airport transportation services on Saturday wasn’t successful. Historic mass marches opposing legislation easing extraditions to China began peacefully in June, and have since widened into a broader movement against Beijing’s increasing grip.Key Developments:Police deployed water cannons, fired tear gas and some drew weapons on Sunday as protests turned violent in the Tsuen Wan district.Police arrested more than two dozen protesters on SaturdayChief Executive Lam seeks to build a dialogue platform to address roots of discontentU.K. consulate staffer Simon Cheng was released by China on Saturday after more than two weeks of detentionHere’s the latest:Weapons drawn (8.30 p.m.)At least two police officers drew weapons after they had come come under attack from protesters. Police said a weapon was fired, according to Now TV and TVB, without providing further details. Running battles continued into Sunday night in Tsuen Wan after a march in the area. By 8.30 p.m., most of the streets in the district appeared to have been cleared by police.Some protesters regathered in the Sham Shui Po area, where they faced off with police in a tense standoff.Water canons on the streets (7.30 p.m.)Police used water cannons to clear barricades set up by protesters in Tsuen Wan, after firing multiple rounds of tear gas to try to disperse demonstrators who had occupied roads. Running battles continued There were no protesters present at the time the water cannons were used, the South China Morning Post reported on its website.With train stations in the area closed down, remaining protestersRain march (Sunday 2 p.m.)People took cover from the persistent rain and filled the stands and pitch of the Kwai Chung sports stadium, the starting point for Sunday’s rally. The march from the stadium was granted late-night approval after organizers appealed an earlier objection by authorities.“The rainy weather is good for the protesters but it’s bad for the police, who are wearing heavy gear. It also makes their tear gas ineffective,” said Gloria Mak, a 25-year-old assistant to a Japanese company.Train service suspended (Sunday 11.30 a.m.)MTR Corp., operator of Hong Kong’s rail network, suspended train service to stations near the planned Tsuen Wan march. The company said in a statement that the Kwai Fong, Tsuen Wan and Tai Wo Hau stations would be closed from 1.30 p.m. until further notice.On Saturday, MTR suspended service on parts of its Kwun Tong line because of protests in the area.Operations Director Adi Lau Tin-shing said the current situation was the company’s biggest challenge in its 40 years of operation and that the station closures were an unavoidable decision taken on the grounds of safety.Police condemn ‘radical’ behavior (Sunday, 3:02 a.m.)Police said “radical protesters” in Saturday’s clashes used electric saws to damage a number of smart lampposts, and hurled hard objects, bricks and petrol bombs at officers. They arrested 19 men and 10 women, aged between 17 and 52, for offenses including the possession of offensive weapons and assaulting police officers, the police said in a statement.Bricks and bamboo poles (Saturday 4:20 p.m.)Police fired tear gas to break up demonstrators blocking a road in the Kwung Tong area. Protesters were seen breaking bricks into smaller pieces and using bamboo poles to keep police from getting close to a barricade they erected. Elsewhere, video footage showed a so-called smart lamppost that was toppled and notes declaring “no totalitarian surveillance” were pasted on it.Protesters split up from the authorized march route and some regathered in the neighborhood of Wong Tai Sin, the scene of clashes earlier this month. Police fired tear gas and made arrests after the demonstrators blocked off roads and disrupted traffic.Lam seeks dialogue platform (Saturday 3:10 p.m.)About 30 people were invited to the meeting organized by Lam in Government House, including ex-transport chief Anthony Cheung and Cardinal John Tong, the former bishop of Hong Kong, RTHK reported. Lam said the meeting was not a “dialogue platform” but a gathering to share ideas on how to build dialogue.“I do not expect dialogue to easily resolve the deadlock, stop demonstrations, or to provide solutions to problems,” she said in a Facebook post. “But continuing to fight is not the way out.”Cathay issues warning (3.30 p.m.)Cathay Pacific Airways Ltd. said it will not tolerate employees supporting or taking part in illegal protests ahead of “planned activities” by the Hong Kong Confederation of Trade Unions on Aug. 26.The Airport Authority Hong Kong obtained a High Court order to extend an interim injunction granted on Aug. 13 banning protesters from unlawfully obstructing access to the airport. That injunction covers Cathay City, “which is the operational hub for our global operations and as such includes facilities that are absolutely critical to our flight operations,” Cathay said in Saturday’s statement.Operations at the city’s airport were disrupted earlier this month when protesters occupied the building.U.K. Consulate Staffer Freed (10:39 a.m.)Chinese police released a U.K. consulate staffer from Hong Kong after more than two weeks in detention. Simon Cheng was set free on Saturday after he was held for violating the Public Security Administration Punishment Law, police in the southern Chinese city of Shenzhen said in a post on the Weibo social media platform. He failed to return home to Hong Kong from an Aug. 8 meeting in Shenzhen.Upcoming ScheduleThe weekend concludes with Sunday protests in the Tsuen Wan and Kwai Chung areas, starting mid-afternoon. Relatives of police also plan a march to the official residence of Chief Executive Lam in support of local law enforcement\--With assistance from Justin Chin, Sheryl Tian Tong Lee and Venus Feng.To contact the reporters on this story: Kari Lindberg in Hong Kong at email@example.com;Annie Lee in Hong Kong at firstname.lastname@example.org;Aaron Mc Nicholas in Hong Kong at email@example.com;Natalie Lung in Hong Kong at firstname.lastname@example.orgTo contact the editors responsible for this story: Shamim Adam at email@example.com, ;Brendan Scott at firstname.lastname@example.org, Stanley James, Andrew JanesFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- The analyst who issued a report warning investors to dump shares of embattled Cathay Pacific Airways Ltd. before they tumble to their lowest levels since 1998, is getting a lot of blowback after his controversial call.“Never before in my 12 years of investment analyst career have I received this much pressure on a particular stock rating,” Zhao Dongchen, who last week issued his inaugural report on Cathay with a “strong sell,” said in an emailed response to Bloomberg queries. “Never before in my 36 years of life am I under such heavy pressure.”Zhao, who’s head of equity research at the investment-banking arm of state-run giant Industrial & Commercial Bank of China Ltd., issued his report as Cathay was under fire from China and facing boycotts from government-run businesses because the carrier’s employees joined the anti-Beijing protests in Hong Kong. No other analyst is advising investors to sell Cathay and Zhao’s HK$6 target price is more than 40% below the stock’s current price.“We have one of China’s biggest state banks issuing an especially bearish and unusual sell recommendation on a private company in H.K. that is already the target of the Chinese state,” said George Magnus, a former UBS Group AG chief economist and author of “Red Flags: Why Xi’s China Is in Jeopardy.” “You don’t have to try hard to conclude that the interests of Chinese state banking institutions and the government are closely aligned.”Since Zhao’s report, which preceded the abrupt resignation of Cathay’s chief executive officer, shares of Hong Kong’s flag carrier have rebounded 4.7%, making them the sixth-best-performer among 64 listed global airlines tracked by Bloomberg.The shares closed 1.4% lower at HK$10.26 in Hong Kong on Friday, marking its fourth straight day of declines.Meanwhile, Zhao has been facing pressure to cancel or delay interviews, change his rating or target price, and refrain from issuing research updates on Cathay since his Aug. 13 report, he said. “A lot of people” tried to persuade him to “go easy” on the company, Zhao said.Still, nobody influenced the report or its timing, and he stands by the call, Zhao said. He said that his research was independent and that people shouldn’t unfairly single out Chinese banks for having state ties because so do lenders in places like the U.K. and Singapore.In his report, entitled “Less Deserved to Fly,” Zhao criticized the Hong Kong carrier for potentially causing “irreversible damage” to the company’s brand because of “poor crisis management” in relation to the protests. The report said that a large-scale management reshuffle would be an “upside risk” for the company.“My strong sell rating is based on the difference between Cathay’s stock price and our target price,” he said. “Simple as that.” He said he won’t shy away from a “shock rating” as he believes contrarian reports to be more helpful to investors.Zhao said Cathay currently trades at a premium to other airlines in Asia, which he believes will “evaporate” because of factors ranging from the unrest in Hong Kong to the effects of the U.S.-China trade war on global commerce.Also, the airline’s management team has shown a “severe lack of composure” in dealing with crises, including a recent data breach and problems with the Chinese regulator, Zhao said.So what’s Zhao’s advice for Cathay now?“Be a better company,” he said.Cathay Pacific declined to comment.Zhao, who typically focuses on raw materials research, runs a team of 21 equity analysts covering 8 sectors at Hong Kong-based ICBC International.Zhao’s primary expertise lies away from airlines, with the analyst voted number one for China energy research by Institutional Investor this year, according to ICBC. He started covering Cathay for ICBC International only in March, though he said he has kept a close watch on industries such as transportation.In 2006, when he first started out in a mutual fund, Zhao said he covered airlines for about three months. “To me, the airlines sector has never been a stranger,” he said.Yet Zhao stands alone among his peers in his bearish view of Cathay. Of the 19 analysts tracked by Bloomberg, 13 have the equivalent of a buy rating and 5 have holds.“Strong sell is the wrong rating on the stock at the moment,” said Mark Webb, an analyst at GMT Research in London who previously covered the stock for 18 years at HSBC Holdings Plc. “Only a significant deterioration in the situation in Hong Kong would make it go significantly lower from here.”Asked why Zhao appears to only assign his harshest ratings to foreign companies such as Rio Tinto Plc, Vale SA and BHP Group Ltd, while only giving buy ratings for Chinese companies such as Shandong Gold Mining Co., Zhao said:“I did just issue a strong sell rating on Cathay Pacific, didn’t I? That’s a Hong Kong-incorporated company, not a foreign one.”(Updates Cathay share prices in fifth, sixth paragraphs)To contact Bloomberg News staff for this story: Evelyn Yu in Shanghai at email@example.com;Gregor Stuart Hunter in Hong Kong at firstname.lastname@example.orgTo contact the editors responsible for this story: Young-Sam Cho at email@example.com, ;Christopher Anstey at firstname.lastname@example.org, Christopher JasperFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Walking a tightrope between anti-government protests and political masters in Beijing, many Hong Kong firms are opting to toe the Communist Party line to avoid potential repercussions having seen what happened at Cathay Pacific Airways. Last week the airline lost its CEO after Beijing exerted political pressure, and on Friday the head of Cathay Dragon's Airlines Flight Attendants' Association said she was fired, without explanation, after managers saw and confirmed her Facebook account. One Hong Kong-based worker of a Chinese state-owned enterprise recently bragged in a WeChat chat group that he had been reporting employees who posted pro-democracy comments regarding the protests to human resources.
Thousands of Hong Kong residents held a sometimes scrappy anti-government protest on Wednesday at a suburban subway station that was attacked by a mob last month, angry that nobody has yet been prosecuted for the violence. Some masked protesters clashed with police, spraying fire extinguishers from the inside of Yuen Long station as others smeared the floor with cooking oil, beer and detergent to stop the police advancing. Others threw empty fire extinguishers at police lines.
HONG KONG/SINGAPORE (Reuters) - Pilots and cabin crew at Hong Kong's Cathay Pacific Airways described a "white terror" of political denunciations, sackings and phone searches by Chinese aviation officials amid anti-government protests gripping the former British colony. Cathay, founded by an American and an Australian during British rule in 1946, was caught in the middle of the crisis 11 days ago, when China demanded it suspend staff involved in the protest movement. The firm agreed, firing two pilots, but has since been plunged into turmoil after CEO Rupert Hogg was replaced last week.
Hong Kong leader Carrie Lam said on Tuesday she hoped a peaceful weekend anti-government protest was the start of efforts to restore calm and that talks with non-violent protesters would provide "a way out" for the Chinese-ruled city. Hundreds of thousands of protesters rallied peacefully in torrential rain on Sunday in the eleventh week of what have been often violent demonstrations. Anger erupted in June over a now-suspended bill that would allow criminal suspects in the former British colony to be extradited to mainland China for trial.
(Bloomberg Opinion) -- It’s hard not to see HSBC Holdings Plc’s exclusion from China’s interest-rate reform as a snub.Hong Kong’s biggest bank wasn’t included in a list of 18 lenders that will participate in pricing for a new loan prime rate that the People’s Bank of China will start releasing Tuesday. The roster includes foreign lenders Standard Chartered Plc and Citigroup Inc., which have smaller China businesses than HSBC.It’s the latest sign that all may not be well in HSBC’s relations with Beijing, after a turbulent period that has seen the departures this month of Chief Executive Officer John Flint and the bank’s Greater China head, Helen Wong. HSBC shares fell 13% in Hong Kong this year through last Friday, compared with a decline of less than 1% in the benchmark Hang Seng Index.London-based HSBC, which is also Europe’s biggest bank, has made China a key plank of its growth strategy. The lender is the third-largest corporate bank in the country by market penetration, according to data provider Greenwich Associates LLC. That places it ahead even of China Construction Bank Corp. and Agricultural Bank of China Ltd., two of the nation’s big four state-owned lenders. Standard Chartered and Citigroup don’t rank among the top five, according Gaurav Arora, head of Asia Pacific at Greenwich.It could be argued that HSBC’s focus on big corporate clients means it’s less attuned to the loan market for small and medium-size enterprises that are the focus of China’s changes to its interest-rate regime. That would be a stretch, though. Corporate banking is a scale game. And even though StanChart may have a greater preponderance of smaller clients, HSBC surely has many similar customers. Citigroup’s inclusion makes more sense: It’s the only U.S. bank in China with a consumer-lending business that spans credit cards to SME loans. The list also includes less influential domestic lenders such as Bank of Xian Co. Those searching for reasons why HSBC may have fallen into China’s bad books may point to Huawei Technologies Co. Liu Xiaoming, China’s ambassador to the U.K., summoned Flint to the embassy earlier this year to interrogate him over the bank’s role in the arrest and prosecution of Meng Wanzhou, the chief financial officer of Huawei, the Financial Times reported Monday. The then-CEO told him HSBC had no option but to turn over information that helped U.S. prosecutors build a case against Meng, the FT said. On Aug. 9, an HSBC spokeswoman denied that Wong’s departure as Greater China head was linked to any issue involving Huawei, pointing out that she announced her resignation before Flint’s departure. Still, the bank has faced criticism in China’s state-owned media over its role in the case. The way HSBC helped the U.S. Department of Justice acquire documents concerning Huawei was unethical, the Global Times reported previously, citing a source close to the matter. The bank was likely to be included in China’s first “unreliable entity” list of companies that have jeopardized the interests of Chinese firms, it said.The timing of China’s interest-rate snub won’t do anything to quell jitters, coming a day after Cathay Pacific Airways Ltd. CEO Rupert Hogg resigned amid criticism from Chinese regulators over its stance on employee participation in Hong Kong’s protests. Beijing is becoming more muscular in its attitude to the city’s unrest and foreign-owned businesses aren’t being spared. In an increasingly politicized environment, even a business that’s been around for 154 years will have to tread carefully. To contact the author of this story: Nisha Gopalan at email@example.comTo contact the editor responsible for this story: Matthew Brooker at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Nisha Gopalan is a Bloomberg Opinion columnist covering deals and banking. She previously worked for the Wall Street Journal and Dow Jones as an editor and a reporter.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
HONG KONG/SINGAPORE, Aug 19 (Reuters) - Cathay Pacific Ltd needs to focus on safety and security, its customers and the completion of a three-year financial turnaround plan, the airline's new chief executive told staff on Monday. Augustus Tang took the top job at the airline following the sudden exit of Rupert Hogg on Friday amid mounting Chinese scrutiny over the involvement of some of the Hong Kong carrier's staff in anti-government protests in Hong Kong.
HONG KONG/SINGAPORE (Reuters) - Cathay Pacific Ltd needs to focus on safety and security, its customers and the completion of a three-year financial turnaround plan, the airline's new chief executive told staff on Monday. Augustus Tang took the top job at the airline following the sudden exit of Rupert Hogg on Friday amid mounting Chinese scrutiny over the involvement of some of the Hong Kong carrier's staff in anti-government protests in Hong Kong. Hogg's departure highlights growing pressure on the corporate sector in the Chinese-controlled former British colony, where Beijing is trying to quell protests that have gone on for 11 straight weeks.
Hong Kong is gearing up for further protests this week after hundreds of thousands of anti-government demonstrators braved heavy rain to rally peacefully on Sunday, marking a change to what have often been violent clashes. Sunday's massive turnout, which organisers put at 1.7 million, showed that the movement still has widespread support despite chaotic scenes last week when protesters occupied the Chinese-ruled city's airport. Some activists had apologised for the airport turmoil and on Sunday night protesters could be seen urging others to go home peacefully.
Shares of Cathay Pacific Airways rose more than 2 percent early on Monday after CEO Rupert Hogg resigned in a shock move, as the carrier grapples with the involvement of some of its employees in the city's anti-government protests. Cathay's shares rose as much as 2.3 percent to HK$10.84, their highest in two weeks. Cathay Pacific was blindsided this month when China's aviation regulator demanded it suspend staff supporting the anti-government protest movement.
Investing.com - Asian markets rose in morning trade on Monday. Shares of Hong Kong-listed Cathay Pacific fell as the company’s CEO resigned amid controversy surrounding the Hong Kong protest.
Hong Kong braced for a major anti-government rally planned for Sunday after an unusually calm Saturday night in what has been a summer of violent protests in the Asian financial hub. Demonstrations have lost some intensity since the ugly scenes witnessed during the protesters' occupation of the city's airport earlier in the past week, and Sunday's rally could show whether the movement still has broad-based support. No tear gas was fired on Saturday night during a brief standoff between police and protesters outside a police station in the Mong Kok district - which was noteworthy after the increasingly violent confrontations in the last 11 weeks.
HONG KONG/SINGAPORE (Reuters) - Cathay Pacific Airways CEO Rupert Hogg resigned in a shock move on Friday, amid mounting Chinese regulatory scrutiny of the Hong Kong carrier over the involvement of its employees in the city's anti-government protests. The sudden departure signals growing pressure on the corporate sector in the Chinese-controlled former British colony, home to multinationals such as HSBC Holdings and Jardine Matheson Holdings, to support Beijing. Cathay Pacific, which has already terminated two pilots for engaging in illegal protests at the behest of the Chinese aviation regulator, named Augustus Tang as its new CEO.
The boss of Hong Kong carrier Cathay Pacific Airways quit on Friday, the highest-profile corporate casualty of unrest roiling the former British colony, after Beijing targeted the airline over staff involvement in mass protests. Demonstrators say they are fighting the erosion of the "one country, two systems" arrangement that has enshrined some autonomy for Hong Kong since China took it back from Britain in 1997. Several thousand protesters gathered peacefully at a downtown park on Friday for the "Stand with Hong Kong, Power to the People" rally, which had received police permission.
(Bloomberg) -- It’s turning into a struggle of wills between bears betting against Hong Kong equities and mainland Chinese investors.Short selling volume on Hong Kong’s main board climbed to 17% of total turnover this week, the highest proportion since at least 1998, based on a five-day moving average. That’s not deterred mainland investors, who were net buyers of Hong Kong stocks via exchange links for the 21st day on Friday.So far bears have been winning. The benchmark Hang Seng Index has tumbled by about 15% from its April high to be among the world’s worst performers, while selling momentum this week was the strongest since China’s currency devaluation four years ago. Mainland buyers are seeing some success though -- the gauge has rebounded 1.8% in the three days through Friday.To be sure, previous surges in the short selling ratio haven’t been a great indicator for future moves. Back in 2016, a spike was followed by an almost 70% rally. But the pessimistic case for Hong Kong shares is easy to sketch.The city is facing one of its worst crises in decades as increasingly violent protests mar its image as a safe and easy place to do business and shop. There is now serious debate about whether Beijing will use military measures to quell the protests after stationing troops in a stadium across the border.Companies are falling foul of the newly politicized environment. Cathay Pacific Airways Ltd. shares plunged after being singled out by Chinese entities for not sufficiently punishing employees sympathetic to the demonstrators. The airline, which has since fired staff who’d been suspended in relation to the protests, announced Friday that Chief Executive Officer Rupert Hogg had resigned "to take responsibility as a leader of the company in view of recent events."The trade war with the U.S. is also hurting the local economy, as well as damping demand for Chinese companies listed in Hong Kong. A weak yuan is adding further pressure.Mainland investors have kept the faith, however, purchasing a net $5.8 billion of Hong Kong stocks in the past 21 sessions, the longest run of inflows since February 2018. They bought the most in nearly 18 months on Friday.To contact the reporter on this story: Jeanny Yu in Hong Kong at email@example.comTo contact the editors responsible for this story: Sofia Horta e Costa at firstname.lastname@example.org, David Watkins, Magdalene FungFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
HONG KONG/SINGAPORE Aug 16 (Reuters) - Cathay Pacific Airways CEO Rupert Hogg resigned in a shock move on Friday, amid mounting Chinese regulatory scrutiny of the Hong Kong carrier over the involvement of its employees in the city's anti-government protests. The sudden departure signals growing pressure on the corporate sector in the Chinese-controlled former British colony, home to multinationals such as HSBC Holdings and Jardine Matheson Holdings, to support Beijing.
(Bloomberg) -- Hong Kong travelers to China are being asked to unlock their smartphones so Chinese agents can examine chat messages and social media, the latest move by authorities to prevent the financial hub’s months-long protests from spreading.One fund manager said he was told to unlock his phone this week at the Shenzhen border, after which officials inspected his Whatsapp and WeChat apps, as well as his photos. The agents asked how the fund manager had obtained pictures of the protests and why he had stored them, and took down information from group discussions about the demonstrations, said the person, who declined to be named.The phone checks add to signs that Beijing is stepping up efforts to control the flow of information on the protests amid fears it could inspire similar unrest in China or embolden pro-independence forces in Taiwan. Domestic media coverage has been tightly controlled, and many cities are keeping a closer eye on citizens traveling to the former British colony.Another Hong Kong student said a border security official went through the photos on his phone when he visited mainland China on Sunday. He said many of the people whose phones were searched appeared to be under 40 years old.The South China Morning Post earlier reported that 10 people said their phones had been checked while they were crossing into mainland China from Hong Kong.Phone calls to China’s Hong Kong and Macau Affairs Office were not answered. The National Immigration Administration and the Shenzhen-based agency handling border inspections do not provide contact information on their websites.Officials at all Chinese ports of entry were told to proactively check the phones of suspicious-looking individuals entering from Hong Kong and delete pictures related to the protests, a person familiar with the directive said.New devicesBankers who travel frequently between Hong Kong and mainland China are swapping their personal phones and laptops for new devices or ones that have been wiped clean, according to three financial professionals in the city, who asked not to be named because of the security risk.One of the bankers said she left her personal mobile phone containing images of the protests at home and took an old iPhone on a recent trip to Shenzhen. She also refrained from packing any outfits in black, the color worn by the protesters, while her colleague deleted Whatsapp from their phone before crossing the border.Multiple Chinese cities this month began barring travel agents and couriers from helping individuals apply for the permits that Chinese citizens need to travel to Hong Kong. People now have to appear in person so their identities can be verified.There are also indications China may be restricting travel from Hong Kong to the mainland. A group of Hong Kong students was told in July their application to enter the country as a tour group was denied because of the protests, a person familiar matter said.(Updates with more details of phones being checked.)\--With assistance from Ben Scent, Gao Yuan, Alfred Liu and Wendy Hu.To contact the reporters on this story: Lulu Yilun Chen in Hong Kong at email@example.com;Fion Li in Hong Kong at firstname.lastname@example.org;Steven Yang in Beijing at email@example.comTo contact the editors responsible for this story: Daniel Ten Kate at firstname.lastname@example.org, Sharon Chen, Sam MamudiFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg Opinion) -- After 10 weeks of silence, Hong Kong’s business elite have started voicing opposition to the city’s increasingly violent protests. The cracking in the facade of neutrality comes amid mounting damage to the Hong Kong economy and pressure from Beijing for public displays of loyalty. Being forced to take sides is unlikely to end happily for them.On Monday, property billionaire Peter Woo called on protesters to quit and wrote that some people were aiming to “purposely stir up trouble.” A day later, Sun Hung Kai Properties Ltd., the city’s biggest developer by market value, issued a statement condemning violent protests. Former Wheelock & Co. Chairman Woo, Sun Hung Kai Chairman Raymond Kwok and his brother Thomas Kwok are among Hong Kong’s 10 richest people, each worth more than $10 billion.The reticence of Hong Kong’s tycoons has been understandable. In normal circumstances, business can be expected to range on the side of the establishment and the forces of law and order. However, overwhelming public support for the protests triggered by a proposed extradition bill has forced them to consider the consequences of potentially alienating employees and customers in the city. Moreover, the business community itself expressed severe misgivings over a law that would have allowed people accused of a crime in China to be sent for trial in the mainland’s politically controlled legal system. Indeed, opposition from companies was an obvious factor in the government’s decision to suspend the bill, as we wrote in June.Threading that needle has now become close to impossible. As the weeks have stretched on and the protests have intensified, China’s central government has become increasingly alarmed. The State Council’s Hong Kong and Macau Affairs Office has staged three press conferences in the past month, having held none in the first 22 years after the former British colony returned to China.Beijing is now demanding order. On Aug. 7, the office called on Hong Kong’s elite to “have no fears and stand up” to protesters, urging them to safeguard the city’s stability and demonstrate “positive energy.” The following day, 17 real estate companies including Sun Hung Kai and Li Ka-shing’s CK Asset Holdings Ltd. released a statement saying Hong Kong had been suffering from “violence perpetrated by a small group of individuals” whose actions had “deviated from the original intent of the peaceful demonstrations and are bringing distress to the business community and the general public as a whole.” Woo is the most prominent businessman to have spoken out against the protests in his own name. With more than $7 billion of his wealth in Wheelock stock, he may be in a more precarious position than most. Subsidiary Wharf Real Estate Investment Co. put up signs at its Harbour City mall this month asking police not to enter unless a crime had been committed, after anti-government protesters threatened to disrupt business at the complex, the South China Morning Post reported. Harbour City and Wharf REIC’s Times Square between them account for 10% of Hong Kong’s retail sales, according to Bloomberg Intelligence analyst Patrick Wong. The company put up the signs after clashes between police and demonstrators last month at a shopping center in the suburban town of Sha Tin that prompted criticism of owner Sun Hung Kai. In that case, the developer denied protesters’ allegations that it invited police to enter the mall.Placating protesters comes with the risk of enraging China, though. For evidence of the costs of being insufficiently supportive, look no further than Cathay Pacific Airways Ltd. Last Friday, China’s civil aviation authority issued a warning to the airline for failing to take appropriate action against employees who took part in illegal protests and demanded a raft of changes, ordering the carrier to suspend all such staff from duty on flights to the mainland.That was just the start. At least two Chinese state-run companies told their employees not to fly on Cathay, and the investment-banking arm of the nation’s biggest lender cut the company’s stock to a “strong sell,” citing damage to its brand from the Hong Kong protests. Cathay shares fell to a 10-year low this week. On Tuesday, Cathay’s parent company Swire Pacific Ltd., said it “resolutely” supports the Hong Kong government and police in restoring law and order. The statement followed a visit by Chairman Merlin Swire to meet with China’s aviation regulators in Beijing on Monday.Expect more such declarations. Like Swire, which has bottling and property operations in China, Hong Kong’s real estate tycoons have major mainland businesses to protect. Wheelock, for example, gets about 38% of its revenue from the mainland.But beware the backlash at home. Hong Kong’s property billionaires hold huge sway over the economy, in a city where inequality has been exacerbated by the world’s least affordable home prices. If seen to be lining up behind forces that aim to perpetuate that system and reject all protesters’ demands – which include greater democracy – they may themselves become tempting targets for popular ire. It’s a no-win situation. To contact the author of this story: Nisha Gopalan at email@example.comTo contact the editor responsible for this story: Matthew Brooker at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Nisha Gopalan is a Bloomberg Opinion columnist covering deals and banking. She previously worked for the Wall Street Journal and Dow Jones as an editor and a reporter.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
HONG KONG/BEIJING (Reuters) - Cathay Pacific Airways has terminated the employment of two pilots, the company said on Wednesday, after it suspended them in the past week over their involvement in protests in Hong Kong. "In response to media enquiries, Cathay Pacific confirms that two pilots have been terminated in accordance with the terms and conditions of their employment contracts," the Hong Kong-based airline said in an e-mailed statement. "One is currently involved in legal proceedings.
After mass flight cancellations on Monday and Tuesday, Hong Kong’s airport resumed operations, although many flights remain delayed or cancelled.
Investing.com - Asian stocks rose in morning trade on Wednesday following U.S.’s decision to delay imposing tariffs on some Chinese goods.