|Bid||580.00 x 0|
|Ask||630.00 x 0|
|Day's range||583.20 - 610.80|
|52-week range||573.80 - 742.60|
|Beta (5Y monthly)||1.51|
|PE ratio (TTM)||32.11|
|Earnings date||29 Jul 2019 - 02 Aug 2019|
|Forward dividend & yield||0.17 (2.82%)|
|Ex-dividend date||08 Aug 2019|
|1y target est||8.78|
Hong Kong's banks face at least two quarters of worsening asset quality and slowing loan growth as the coronavirus outbreak hits trade and consumer banking, analysts and bankers said. Lenders in the Asian financial hub, including HSBC and Standard Chartered , are seeing a drop in demand for mortgages, credit card usage and corporate loans, bankers with knowledge of the matter said. Hong Kong banks have Asia's largest exposure to China, which accounted for 29.4% of banking system assets in the first half of last year, credit ratings agency Fitch says.
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world threatened by trade wars. Sign up here. A range of early indicators of China’s economy in February confirm that the coronavirus outbreak has crippled production and consumption, as factories remain below capacity and transport is curtailed.Five of the eight indicators tracked by Bloomberg dropped in February from January, with two indicators of business confidence plunging to the lowest on record.The improvement in the headline South Korea exports in first 20 days of the month hides a drop in shipments to China and was flattered by the distortions from the Lunar New Year. Expectations of fresh stimulus have also kept financial markets more buoyant than real activity would suggest.While businesses are restarting and the official data shows the rise in infections slowing, the virus is not yet overcome, and companies and various levels of governments have to weigh the desire to return to normality quickly with the need to stop the disease. The economy is forecast to grow the slowest since 1990 according to the median of recent economists’ reports, with Goldman Sachs Group Inc estimating it will expand only 2.5% in this quarter, before rebounding later.The Data Show China Is Still Struggling to Get Back to WorkA slowdown of that magnitude could lead to higher unemployment, bad loans, and bankruptcies. Already car sales are plummeting and property developers are being squeezed as people hold back on spending as they wait to see what will happen with the disease, and when they can go back to work.The reaction to the outbreak will be visible in the first official statistics for February -- the Purchasing Manager Indexes due on Feb. 29. The indicator for manufacturing is forecast to drop to the lowest since the global financial crisis, although five economists are forecasting it to be even worse than that.“The earliest business surveys have already shown record declines of demand and output. The overall momentum reversed strength in previous months to weakness in February, as the virus hit industrial production, supply chains and consumption,” according to Bloomberg Economics’ Qian Wan. “We expect activity to start to recover from March. Efforts to contain the virus continue, but the government is clearly shifting” toward pro-growth policies to and help companies get back to work after the extended Lunar New Year break, she said.A monthly survey on the health of China’s small and medium-sized businesses plummeted to a record-low in February, highlighting the negative economic impact of the outbreak. A sub-index from the survey by Standard Chartered Plc evaluating “current performance” dropped even more sharply, while the reading for the outlook was better than the headline number, signaling some hope for recovery once the outbreak is contained.About two-thirds of small- and medium-sized companies only have enough cash on hand to survive for up to three months, according to the report from Shen Lan and Ding Shuang at Standard Chartered. Earnings in the first quarter will fall 43%, according to their survey, with the biggest drops in wholesale and retail industries.One bright spot in the indicators Bloomberg tracks has been Chinese stocks, which took just weeks to recover from a record sell-off earlier this month triggered by the virus. But that almost 10% rally since Feb. 3 is built on little more than liquidity, surging partly on hopes that monetary easing and fiscal support measures would help companies weather economic headwinds. Leverage on Chinese exchanges rose above 1 trillion yuan ($143 billion), the highest since early 2016.Cracks Appear in China’s Most Leveraged Stock Market Since 2016Note on Early Indicator constructionBloomberg Economics generates the overall activity reading by aggregating the three-month weighted average of the monthly changes of eight indicators, which are based on business surveys or market prices.Major onshore stocks - CSI 300 index of A-share stocks listed in Shanghai or ShenzhenKey property stocks - All the constituents of CSI 300 Index that are in the real-estate industryIron ore prices - Spot price of iron ore for shipment to Qingdao port (dollar/metric tonne)Copper prices - Spot price for refined copper in Shanghai market (yuan/metric tonne)South Korean exports - South Korean exports in the first 20 days of each monthFactory inflation tracker - Bloomberg Economics created tracker for Chinese producer pricesSmall and medium-sized business confidence - Survey of companies conducted by Standard Chartered BankSales manager sentiment - Survey of sales managers in Chinese companies by World Economics Ltd.To contact Bloomberg News staff for this story: James Mayger in Beijing at firstname.lastname@example.orgTo contact the editor responsible for this story: Jeffrey Black at email@example.comFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- South Korea’s won slumped more than 1% and the Singapore dollar slid to the lowest in almost three years as traders dumped riskier assets amid growing concern about the spread of the coronavirus.No Asian currency was spared in the rout which was triggered by a spike in confirmed virus cases in South Korea and two fatalities in Japan. The yuan retreated and the Australian dollar, which is seen as a proxy to the Chinese currency, slid to an 11-year low.“The sudden sharp spike to 82 cases in Korea -- contrary to slowing new cases in other parts of the world including China -- is a wake-up call to market complacency,” said Christopher Wong, senior FX strategist at Malayan Banking Bhd. The won, along with Asian peers such as the Singapore dollar, may be some of “biggest casualties” as the economic fallout continues to worsen.The Thai baht tumbled to an eight-month low while the Indonesian rupiah and Malaysia’s ringgit depreciated at least 0.5%. The offshore yuan extended a decline past 7 per dollar to trade at its weakest since December.South Korea reported that the number of its confirmed virus cases more than doubled in a day, raising concern about the spread of the disease outside China. Japan said two people who were on a cruise ship off Yokohama, a man and a woman in their 80s, had died after being infected.Yen Weakness May Just Be Beginning Amid Japan Fund Exodus FearMarket participants warned that regional currencies could be vulnerable to further losses, with policy makers having little room to act.“The reality of an economic slowdown has hit home,” said Alan Cayetano, foreign-exchange trading head at Bank of the Philippine Islands. “A further deterioration in emerging Asia currencies should be expected as central banks are boxed into a corner with lower rates.”Even stimulus from China -- which had previously helped to stabilize sentiment -- wasn’t enough to allay concerns. Analysts questioned the effectiveness of a move by Chinese banks to cut benchmark borrowing costs for new loans.Infection ThreatThe Singapore dollar fell as low as S$1.4083, the weakest since May 2017, before paring losses to trade 0.3% down. The won sank more than 1% to 1,201.95 per dollar, a level where policy makers may have previously intervened. The baht, the most sensitive in Asia to tourism, dropped 0.7% to 31.406.A gauge of three-month implied volatility for the Bloomberg-JPMorgan Asian Currency Index rose 12 basis points to 4.36%.Singapore Dollar Vulnerable to 2017 Low on Surprise Easing RiskThere could be “further downside pressure on Asian currencies in the near-term as investors assess the negative economic impact from the coronavirus outbreak,” said Divya Devesh, head of Asean and South Asia FX research at Standard Chartered Bank in Singapore.\--With assistance from Kartik Goyal.To contact the reporters on this story: Ruth Carson in Singapore at firstname.lastname@example.org;Chester Yung in Singapore at email@example.comTo contact the editors responsible for this story: Tan Hwee Ann at firstname.lastname@example.org, Liau Y-SingFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
These two FTSE 100 (INDEXFTSE:UKX) shares could offer higher return potential than gold in my opinion.The post Forget gold! I’d buy these 2 FTSE 100 dividend stocks to get rich and retire early appeared first on The Motley Fool UK.
(Bloomberg) -- South African President Cyril Ramaphosa announced sweeping changes to the nation’s electricity industry to address energy shortages and reduce reliance on debt-stricken state power utility Eskom Holdings SOC Ltd.The government will invite private companies to submit bids to supply additional renewable energy to the grid, while businesses will be allowed to produce unlimited electricity for their own use, Ramaphosa said in his state-of-the-nation address in Cape Town on Thursday. Additional capacity will be purchased from existing solar and wind plants, and independent producers will also be permitted to sell their output directly to municipalities.“We will be implementing measures that will fundamentally change the trajectory of energy generation,” Ramaphosa said.Eskom provides about 95% of South Africa’s power, but isn’t generating enough income to cover its costs. While the measures announced by Ramaphosa could further deplete its revenue base, its aging power stations don’t generate enough electricity to meet demand. That’s resulted in rolling blackouts and with several of its plants due to be retired over the next few years, urgent intervention is needed to avert an even deeper crisis.Ramaphosa announced the overhaul after being forced to delay his speech for 90 minutes because of repeated interruptions by the opposition Economic Freedom Fighters. The party’s members demanded that Public Enterprises Minister Pravin Gordhan be fired -- for failing to address the energy crisis -- before they walked out of the chamber.The rand weakened as much as 0.8% before trimming its losses to trade 0.6% weaker at 11 p.m. in Johannesburg, after Ramaphosa’s speech had ended.The protest made for “good political theater, but wasn’t really a surprise to observers,” said Ilya Gofshteyn, a New York-based strategist at Standard Chartered Bank. “Reform progress is likely to continue to be halting, but I do not think that EFF behavior today materially changes the outlook.”Since succeeding Jacob Zuma as president in February 2018, Ramaphosa has faced mounting pressure to revive the economy and create jobs for the 29% of the workforce that’s unemployed.Besides constraining economic growth, Eskom, South African Airways and several other state companies are stretching the government’s already limited finances with constant demands for bailouts to stay afloat.Ramaphosa warned the nation’s debt trajectory is unsustainable and said Finance Minister Tito Mboweni will announce measures to cut spending when he delivers his budget speech on Feb. 26. The government is in talks with labor unions about reducing the state wage bill, he said.“We need to fix our public finances,” Ramaphosa said. “We cannot continue along this path, nor can we continue to stand still.”The energy reforms and others announced by Ramaphosa will take some time to implement, and his speech doesn’t signal a fundamental shift in policy or approach, said Peter Attard Montalto, head of capital markets research at Intellidex.‘Short-Term Lift’“He could have gone harder on specifics of timelines and responsibilities,” Attard Montalto said. “At the margin, the market is going to have a short-term lift on this going into the budget, but I think it will then fade after that.”Mineral Resources and a Energy Minister Gwede Mantashe signaled the measures to boost energy production will be speedily implemented.“The president mentioned the generation capacity outside of Eskom” must be increased, he said in an interview. “To me that’s an order.”Ramaphosa’s address struck the right chord with the Congress of South African Trade Unions, the country’s biggest labor group and a member of the nation’s ruling coalition.“The president focused on the key issues of growing the economy and restoring the capability of the state,” said Matthew Parks, the group’s parliamentary liaison officer. “Eskom is a key factor and we know that negotiations are proceeding positively between government, business and labor to sort out Eskom’s financial situation.”Other Highlights:A sovereign wealth fund will be established to preserve the nation’s wealth.The government will press ahead with plans to establish a state bank.Far-reaching economic reforms, including a number that were proposed by the National Treasury, will be implemented.South African Airways will be restructured to ensure it is commercially and operationally sustainable.The auction of additional broadband spectrum will be concluded this year.The Treasury will set aside 1% of the budget to address youth unemployment.Efforts will be stepped up to tackle crime and corruption.(Updates with energy minister’s comment in second paragraph below Short-Term Lift subheadline.)\--With assistance from Robert Brand, Justin Villamil and Antony Sguazzin.To contact the reporters on this story: Mike Cohen in Cape Town at email@example.com;Paul Vecchiatto in Cape Town at firstname.lastname@example.orgTo contact the editors responsible for this story: Paul Richardson at email@example.com, Rene VollgraaffFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- When bankers fret about contagion, it’s usually the financial kind. DBS Group Holdings Ltd. is battling a different outbreak. The full-year results of Singapore’s largest lender are pre-coronavirus. Still, they offer clues to what investors in banks with pan-Asian heft — including HSBC Holdings Plc, Standard Chartered Plc and Citigroup Inc. — should be watching.A day before its earnings report Thursday, DBS had to evacuate an entire floor of 300 people in its headquarters after one employee tested positive for the virus. Stressful as such situations are, big organizations like DBS have protocols to preserve business continuity. The bank, which now does a growing chunk of its business online, ought to be able to supply banking services reasonably efficiently. The main concern is whether the epidemic, which has hit its key markets of Singapore, Hong Kong and China, will sap demand for financial intermediation. Things were looking tough even before the virus, though DBS ended the year with record earnings of S$6.39 billion ($4.6 billion), a 14% increase. Loans grew 4% last year, slowing from 7% in 2018. The Singapore mortgage business lost momentum after the government surprised the market in July 2018 by introducing measures to curb price gains. Net interest margin peaked at 1.91% in the first half before stumbling to 1.86% in December, as the Federal Reserve stopped raising interest rates and started cutting.That’s a less favorable stage than the 2003 Severe Acute Respiratory Syndrome epidemic, when DBS had better margins than now.If the top headache for trade finance in 2019 was the U.S.-China spat, supply-chain disruptions would be this year’s migraine. Assuming the outbreak is under control by summer, DBS foresees a 1% to 2% hit to annual revenue. But what if the public health scare lasts longer and spreads wider? Add the risk that the Fed may be forced to cut interest rates further to deal with the fallout from the disease, and the outlook for loan pricing is dimmer than two months ago. Singapore is expected to vigorously prime its fiscal pumps next Tuesday to support virus-hit businesses, such as hospitality and retail. With local infections climbing, DBS should assume that the first half of 2020 may be a washout in its home market. What’s more relevant is whether there will be a sharp recovery, which is what happened after SARS. After dropping 13% in the first half, net profit for 2003 tapered to a smaller 7% fall. It almost doubled the following year. DBS had to face SARS when its balance sheet hadn’t fully healed from the 1997-98 Asian financial crisis. Nonperforming loans, which had surged to 13% of the total in 1999, were still elevated at about 6% in December 2002. Contrast that with 1.5% bad loans at the end of last December; it’s a figure that will keep coming back for scrutiny as the year progresses.The credit quality in Singapore might still hold up, as banks proactively manage their borrowers’ liquidity. United Overseas Bank Ltd., the smallest of Singapore’s three homegrown lenders, said Wednesday that it’s setting aside S$3 billion to provide relief, especially to small companies. Those affected will meet only interest obligations this year. Principal repayment can wait. But DBS’s regional presence could be problematic. A sharp tumble in either the over-leveraged Chinese economy, the epicenter of the epidemic, or turbulence in the frothy Hong Kong property market would put investors’ focus back on provisions for bad debt. Subdued loan volumes, pricing pressures and spikes in credit costs will complete the trifecta of risks for Asian regional banks.Globally, banks garner the biggest chunk of their near $2 trillion annual pretax profit from Asia. The growth rate of that earnings pool collapsed to just 3% between 2014 and 2018 from 12% in the preceding four years, according to new research by McKinsey & Co., which comes with a dire message: “Asia's banks must reinvent themselves or risk disappearing.”When the dust settles, there may be acquisition opportunities for a well-capitalized lender like DBS. That’s a story for a later time. The worry right now is that customers won’t be doing M&A deals because of business uncertainty and anxiety about travel and meetings. That can’t be good news for investment banking fees. To contact the author of this story: Andy Mukherjee at firstname.lastname@example.orgTo contact the editor responsible for this story: Patrick McDowell at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Libya’s oil production is down to less than 200,000 bpd, and the uncertainty surrounding the outage create complications for OPEC+ as it looks to cut deeper
(Bloomberg) -- Markets are underpricing the risk that U.S. President Donald Trump may lose this year’s election and investors should consider buying the yen as a hedge, according to Standard Chartered Plc.The Dollar Index has gained more than 2% since the start of the year as it tracked Trump’s online re-election odds in a stronger-than-expected correlation, according to StanChart’s head of global G-10 FX research Steve Englander. But with polls and online markets suggesting that Trump isn’t a shoo-in, investors may want to hedge the risk with the dollar-yen pair, he said.“We like USD-JPY downside as a hedge when it moves into the 109.50-110.50 range,” Englander wrote in a report Monday. “The limited upside on JPY, its low implied volatility, and the responsiveness to negative political and economic shocks make it an attractive hedge to long risk positions.”The yen is a good hedging tool as it’s responsive to downside economic shocks while largely staying stronger than 110 per dollar since May, according to Englander. Japanese policy makers may want to avoid having an overly weak yen that could become a political issue during a U.S. election year, he said.Markets have already started to price in uncertainty around this year’s American presidential election, particularly given Wall Street’s concerns about the chance that a progressive candidate such as Elizabeth Warren or Bernie Sanders might win the nomination, or even the presidency. The Cboe Volatility Index futures curve is just one place showing bets on heightened volatility.The dollar-yen pair has climbed more than 5% to 109.87 since reaching the lowest in almost three years in August.\--With assistance from Christopher Anstey.To contact the reporter on this story: Joanna Ossinger in Singapore at firstname.lastname@example.orgTo contact the editors responsible for this story: Christopher Anstey at email@example.com, Liau Y-Sing, Nicholas ReynoldsFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Oil declined after an industry report showed a rise in U.S. crude stockpiles, deepening losses after closing below $50 a barrel for the first time in a year amid fears the lethal coronavirus will imperil crude demand.Futures fell 1.5% in New York Tuesday after the American Petroleum Institute reported that U.S. crude inventories rose 4.18 million barrels last week, according to people familiar with the data. The rise intensified fears of a supply glut that has rattled investors with demand uncertainty stemming from China’s coronavirus outbreak.“We’re getting close to the bottom and it’s clear OPEC is not going to sit on their hands,” said Phil Flynn, an analyst at Price Futures Group Inc. “There’s some dire predictions being priced in right now.“The deadly virus has menaced markets by upending trade flows and is estimated to have cut 20% from China’s oil demand as quarantined cities and closed factories cripple industrial activity in the second largest economy in the world. Refineries are curbing operations, while the nation’s top processor is trying to resell millions of barrels of crude it no longer needs. The crisis could wipe out a third of the growth in global consumption this year, said BP Plc Chief Financial Officer Brian Gilvary.OPEC+ consulted with China in an urgent assessment of how the coronavirus may hurt oil demand, and what measures the group could take to stop prices falling any lower. A full meeting of the Organization of Petroleum Exporting Countries and its allies is currently scheduled for March, but the group is considering whether to hold that gathering earlier. The coalition is expected to discuss potential production cuts in response to the outbreak in China on Wednesday.West Texas Intermediate for March delivery traded at $49.44 a barrel at 4:41 p.m. after ending the session at $49.61 a barrel on the New York Mercantile Exchange. Prices had briefly rebounded to $51.55 earlier in the day.Brent for April delivery lost 66 cents to $53.79 on the London-based ICE Futures Europe exchange.The API report also showed distillate supplies fell by 1.78 million barrels last week, while gasoline stockpiles increase by 1.96 million barrels.Traders are wary the virus-induced sell-off has driven prices to alarming levels that could ignite a crash resembling the plunge in October 2018 when Wall Street banks rushed to sell futures to cover options contracts, sparking further declines.“WTI is trying to hold on to that $50 support level,” says Olivier Jakob, analyst at Petromatrix. “But it’s going to be difficult unless OPEC takes decisive action, otherwise we’ll get to the lows of 2018.”The extent of OPEC’s decision will also hinge on Libya’s oil output, Standard Chartered Plc analysts including Paul Horsnell wrote in a report. The country has been roiled by a political crisis that led to a blockade of its ports last month. Production has fallen to about 187,000 barrels a day, according to state oil firm National Oil Corp.\--With assistance from James Thornhill, Sharon Cho, Alex Longley and Grant Smith.To contact the reporter on this story: Jackie Davalos in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: David Marino at email@example.com, Mike Jeffers, Catherine TraywickFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Here's why how cheap or expensive shares in large cap Banks operator Standard Chartered (LON:STAN)matters. Stacks of academic research covering different time8230;
(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here. China’s central bank took its first concrete steps to cushion the economy and plunging markets from the blow of a spreading new virus, providing short-term funding to banks and cutting the interest rate it charges for the money.The People’s Bank of China added a net 150 billion yuan ($21.4 billion) of funds on Monday using 7-day and 14-day reverse repurchase agreements. The rate for both was cut by 10 basis points, driving down the cost of the money to “ensure ample liquidity during the special period of virus control,” it said in a statement. PBOC adviser Ma Jun indicated he expects further rate cuts later in the month.The cash injection was part of a raft of supportive measures announced over the weekend to soften a market sell-off and help firms affected by the disease outbreak and extended holiday. While the government said Monday that it’s confident it can minimize the economic impact of the coronavirus, the central bank and regulators may well continue to step up support as the effects of the epidemic become clearer.“It’s a tricky moment, and the central bank needs to wait to see how it plays out,” said Nie Wen, an economist at Huabao Trust Co. in Shanghai. “It has to make sure the economy can grow steadily while leaving policy room for the future -- the next week or two will be crucial for them to decide whether the economic shocks would be temporary or extend over the mid-term.”A senior Chinese official on Monday acknowledged the impact on the economy, especially on tourism, transportation, hotels, catering, movies and entertainment, adding those difficulties are “temporary.”“Many people tend to use SARS in 2003 as a reference to gauge the economic impact. But China’s economic strength, material foundation and ability to respond to emergencies are significantly stronger than in 2003,” Lian Weiliang, deputy head of the National Development and Reform Commission said at a press conference on Monday. “We are fully capable and confident to minimize the impact of the epidemic on the economy.”Lian also said that while the government would work to ensure the coronavirus didn’t spread further, it would encourage major projects and enterprises in good condition to resume work and production. Policy makers will also roll out measures to soften the impact of the epidemic on a case-by-case basis, especially to try to help industries that have been hit hard, Lian said.Vice Commerce Minister Wang Bingnan said at the same press conference that many exporters in China have been resuming production, and local governments have been issuing policies to help small and medium-sized companies.Authorities have pledged to provide abundant liquidity and there seems to be more easing measures in the pipeline. In an interview with the PBOC’s Financial News newspaper, central bank adviser Ma Jun said he expects the PBOC to push the interest rate for new loans lower and to also cut the rate for medium-term funding in February if it uses that facility mid-month, as it usually does.If that were to happen, it would be a change to a “rather strong” easing bias for the central bank, according to Peiqian Liu, China economist at Natwest Markets Plc in Singapore.What Bloomberg’s Economists Say...The PBOC is combining lower borrowing costs and increased liquidity to cushion the blow from the spreading coronavirus. “We think this signals its major policy rates will also be guided lower.”\-- David Qu and Chang Shu, Bloomberg EconomicsClick here for the full reportHaving moved away from its historic one-year lending rate, China’s central bank now conducts policy with a range of instruments that add short and mid-term funds to the market and banks at varying interest rates. The new loan prime rate -- which is based on the interest rate for one-year loans that 18 banks offer their best customers -- is set to be announced on Feb. 20.Markets PlungeChinese stocks, the yuan and commodity futures sank Monday as trading restarted following the holiday break. The onshore bond and currency markets also opened Monday for the first time since Jan. 23, with the yuan weakening through 7 per dollar. The yield on China’s most actively traded 10-year government bonds dropped the most since 2014.After markets closed, the central bank affiliated Financial News published a commentary saying “the sell-off in the stock markets is caused by many irrational factors, or even a panic triggered by ‘herd effects.’” The impact from the epidemic is “temporary” and “limited” and the first quarter’s contribution to full-year growth is normally small, according to the article.“The swift response by the PBOC suggests it is very keen to support the economy by lowering the overall cost of funding,” said Becky Liu, head of China macro strategy at Standard Chartered Plc. “Cash bonds will likely continue to outperform in the near term,” with the 10-year government yield likely to drop to 2.6%, she said after the bank’s actions in the morning. That level would be the lowest yield since 2002.(Updates with Bloomberg Economics’ report.)To contact the reporters on this story: Tian Chen in Hong Kong at firstname.lastname@example.org;Yinan Zhao in Beijing at email@example.com;Miao Han in Beijing at firstname.lastname@example.orgTo contact the editors responsible for this story: Sofia Horta e Costa at email@example.com, ;Malcolm Scott at firstname.lastname@example.org, James Mayger, Robert FennerFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Emirates Global Aluminium (EGA), one of the largest industrial companies in the United Arab Emirates (UAE), said on Monday it had secured a $600 million three-year revolving loan from UAE and international banks. Commercial Bank of Dubai, Emirates NBD, Mashreqbank and Standard Chartered were joint lead arrangers and bookrunners for the deal, the company said in a statement.
(Bloomberg Opinion) -- Being a shopping-mall landlord is a risky business in the age of e-commerce, even in retail-crazy Singapore. So it’s only sensible that CapitaLand Mall Trust is merging with CapitaLand Commercial Trust, which owns offices.The S$8.3 billion ($6.2 billion) deal between the two sister real estate investment trusts, or REITs, will create a property owner of some heft. The combined entity will have the firepower to undertake up to S$4.6 billion in overseas acquisitions. At home, the revenue stream from shops — under pressure from online sales — will get commingled with more stable office rents.That will be a relief. CapitaLand Mall Trust’s income available for distribution grew a healthy 7.5% last year, but the REIT’s tenants saw sales decline 1.4% on a per-square-foot basis, with electrical and electronics, home furnishings and information technology and telecommunications recording falls of more than 10%, according to figures released Wednesday.This is part of a global trend. As I wrote in July, Singapore’s Generation Z — those born after 2000 — won’t be mall rats. It will be a challenge for landlords to eke out positive rental “reversions” when tenancies come up for renewal. More than half of Rafffles City Singapore, a marquee property in the trust’s portfolio, was leased out again last year, and the owner saw no increase in rates. At The Atrium@Orchard — another prestigious downtown location — rentals dropped 6.5% from when CapitaLand Mall signed them three years earlier.Mind you, Singapore’s office market is also showing signs of fatigue. Rents for Grade A offices stopped rising in the December quarter as the city’s small, open economy slowed amid U.S.-China trade tensions. Colliers International Group Inc. forecasts they will climb just 1% in 2020, before sliding 4% next year. Things could get uglier still if the co-working trend comes under strain following last year’s WeWork debacle.Even those worried about the shared-space segment should be encouraged by the technology industry — especially fintech. With 21 bids for up to five new digital bank licenses, the outlook for the city’s office market is more optimistic than it is for retail. CapitaLand Commercial Trust generally experienced positive rental reversions during the December quarter. Properties such as Six Battery Road, formerly Standard Chartered Plc’s Singapore headquarters, and 21 Collyer Quay, where WeWork will move in after HSBC Holdings Plc moves out, could do even better after the landlord spruces them up this year.Singapore’s office market will also undergo transformation as city planners make a deliberate attempt to have more people living in and around the central business district. The idea is to increase the utility of the island’s priciest real estate so that it’s not a ghost town after working hours. As part of the plan, old office towers near the central bank and the stock exchange will be redeveloped as mixed-use properties that have more space to sell or rent out. Neither these structural changes nor the cyclical ebb and flow of office demand and supply is a surprise to property builders and owners. Assessing the retail industry is trickier. Not only could it be facing terminal decline because of surging digital consumption, it’s also driven by tourism. Interest in the city peaked after the 2018 release of “Crazy Rich Asians,” and continued to rise — to about 5 million visitors in the third quarter of 2019 — after Hong Kong’s anti-government protests. The recent outbreak of a new respiratory virus, however, is a reminder of how ephemeral such gains could be.The virus, which originated in the central Chinese city of Wuhan, may or may not be a repeat of the deadly 2003 SARS epidemic, which hit Singapore hard. Yet it gives real-estate investors another reason to want their rents coming from a combined pool of retail and offices. That way, the profit available for distribution will become more future-proof — at least until artificial intelligence makes it unnecessary for humans to show up for work at all.To contact the author of this story: Andy Mukherjee 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 Bloomberg LP and its owners.Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He previously was a columnist for Reuters Breakingviews. He has also worked for the Straits Times, ET NOW and Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Standard Chartered CEO Bill Winters said investors have 'an enormous opportunity and I would say obligation' to invest in green projects.