Wolf Money(world market review 25-31 Oct 2021)

Liu Kang Singapore 1911-2004

Kampong Scene circa 1951 

Gift of the Artist’s family 

Collection of National Gallery Singapore 

Market Summary 25-31 Oct 2021

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- US GDP grows 2% annualised pace in Q3, slowest in over 1 year on slowdown in consumer spending

- US headline inflation rose at 4.4% annual in Sept, fastest since 1991, pushed by 25% up in energy costs, 4.1% gain in food 

- US core inflation; Fed’s preferred gauge up 3.6% for the 12 mths, also fastest pace in 30 years 

- US personal income declined 1% in Sept, more than expected 0.4% drop

+ US consumers slowed their spending to modest gain of 0.6% in Sept with high inflation 

+ US consumer sentiment rose slightly in late Oct but stayed at low levels over the mth: Uni of Michigan  

- US employment costs rose more then expected at fastest annual pace in 19 years  

- US mortgage rates rise to 8-mth high, refinance demand fell 2% week to week

- US pending home sales fell 2.3% in Sept vs Aug, likely due to higher mortgage rates 

+ US weekly jobless claims at 281,000, below 289,000 estimate to fresh pandemic-era low 

- US billionaires would pay tax on unrealised gains from their assets, according to proposal unveiled 

+ Biden to discuss intensifying supply chain challenge with G20 leaders 

- US Trade Chief Tai said she aimed at reducing temperature of US-China that has become dangerously heated

+ Yellen expects inflationary pressures to ease by H2 of 2022 

+ US Trade Representative Tai to travel to Japan, South Korea, India

+ US and EU reached agreement to settle diplomatic rift over Trump-era steel and aluminium tariffs 

- Pentagon sounds alarm on China’s ‘hundreds’ of hypersonic tests 

+ FDA recommends Pfizer’s low-dose vaccine for kids under 12

- US terminated authorisation for China Telecom’s US unit to conduct business, citing significant national security risks 

+ Boeing working with Chinese regulators to clear its 737 MAX to return to service by end of the year: CEO

+ Microsoft passed Apple in market cap to become world’s most valuable company at nearly US$2.49 trillion market value 

- Apple warns of more supply chain woes after US$6bn revenue hit 

+ Telsa becomes US$1 trillion company 

+ Hertz plans to order 100,000 Tesla EV, representing about US$4.2bn revenue 

+ FB changed its name to “Meta”, to invest billions in metaverse as ad business slows 

- American Airlines cancelled 1400 flights, citing weather and staffing issues 

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+ China published rules required its globally systemically important banks to beef up capacity to absorb losses to head off financially instability 

+ China will defer some taxes for manufacturers for 3 mths due to impact of high raw material prices and production costs 

+ China releases action plan to peak carbon dioxide emissions before 2030 

+ Xi attending G20 Leaders' Summit via video link

+ China issued roadmap for carbon neutrality by 2060

+ China to create rare-earths giant by joining 3 state companies 

+ China mutual funds surged to US$2.75 trillion as retail investors seek stability over volatile real estate, wealth product 

+ China to start vaccinating children as young as age 3

- China to tighten rules on data transfers abroad with review trigger 

+ Chinese bonds overseas investors get 4 more years of tax breaks

- China recorded its highest number of daily local new Covid-19 infection in >6 weeks 

+ China’s securities regulator issued basic system of Beijing Stock Exchange that will start on Nov 15 

- China’s top economic planner said coal prices have further room to drop, set limit for price fluctuation 

+ China to implement punitive compensation system targeting intellectual property infringements 

+ China’s property developers told to pay int’l debts on time, want advance notice from any firm that plans to default 

- PBOC warned online brokerages not licensed in China are acting illegally if they serve Chinse clients via internet

- China instructed Evergrande’s founder to pay down company’s US$300bn debt with personal funds: Bloomberg 

- China’s top 3 power producers lost combined ¥6.9bn in Q3  

+ China triples coal imports from Russia after banning Australian imports 

- China’ steel industry on track to churn out less this year in line with official targets, likely to fall by 30m tons 

+ China newly released quarterly sales data shows increasing reliance of US corporation on growing Chinese market 

+ China’s coal imports from US soared 870% in first 9 mths to 7.2m tons, from Canada rose 92% to 6.6m tons 

- Alibaba has lost US$344bn in market cap over the past year amid China cracks down on tech monopolies 

- Huawei reported revenue of US$71.19bn in first 3 qtrs, down by 32%, but remains profitable 

- Evergrande founder pledges HK luxury house for loan collateral, requested by company’s creditors

+ Evergrande made an overdue US$45.2m payment on a bond, one day before it would have been declared in default 

- Air China posted ¥7.7bn net loss in H1

+ HNA Gp restructuring proposal approved; to be split into 4 independent operating segments 

+ BYD said to hike battery prices by at least 20% next mth as lithium costs soar 

- Yum China’s Q3 earnings fell 76% as outbreak curbs hit sales 

- HK total exports value YoY growth slows to 16.5% in Sept 

+ HKEX govt financial advisory body backed proposal by HKEX to introduce new listing option involving SPACs 

- HK’s decision to pursue zero-Covid strategy is hammering its business reputation: industry group 

- HK rejects pleas from global banks to scrap its Covid zero strategy 

+ HK to further tighten Covid travel restrictions as it bids for quarantine free travel with China 

- HK crackdown on smuggled Australian lobsters defends national security: customs chief 

+ TSMC, Gogoro expressed interest to invest in Indonesia’s battery and EV industries 

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- BOJ revised down its annual growth forecast, maintained its ultra-loose monetary policy

- Japan’s industrial output fell to its lowest level in 13 mths in Sept, sharpest decline on automotive industry 

- Japanese automakers’ domestic output falls nearly 50% in Sept YoY 

+ Japan foreign minister calls for US to join CPTPP

+ Tokyo Stock Exchange to extend daily trading hours by 30 minutes, possibly in H2 of 2024

- Nomura’s profit drops 64% after US$343m charge 

+ Panasonic unveiled a large new prototype battery designed to help Tesla lower EV production costs 

+ Toyota unveiled EV with 500km range 

- ANA to cut workforce by 9000 within 5 years, expect to remain in red for 2nd straight year with Ұ100m net loss in fiscal 2021 

+ Russia-US trade turnover jumped nearly 50% since Jan: customs data 

+ Russia ramps up agricultural exports by almost 20% since Jan, totalling US$26bn as of Oct 

+ Gazprom has ramped up natural gas production to meet as much as 1/3 of world’s increase in consumption this year  

+ G20 endorsed global minimum tax on corporations at Rome summit  

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- Euro Zone companies brace for another year of supply snags: ECB 

+ Euro Zone economy grows at fastest pace in a year in Q3 as Covid-19 restriction steadily eased 

- Euro Zone inflation shot past expectations to 4.1% in Oct to hit another 13-year high, up from 3.4% in Sept 

- EU ministers unable to find common ground over new measures to quell increasing energy prices: EU commissioner 

+ European natural gas prices dropped below US$850 per 1000 cubic meters first time since end Sept  

- German inflation jumps to 28-year high of 4.5% in Oct, with energy prices shotting up 18.6%

- Germany slashes 2021 growth forecast to 2.6% from 3.5% due to supply chain disruptions and shortage of raw materials

+ FTSE Russell included Chinese govt bonds on FTSE WGBI 

+ HSBS reported pre-tax profit US$5.4bn in Q3, up 75.8% YoY, plans share buyback at US$2bn max 

- UK-France faced calls to sort out post-Brexit spat over fishing rights in English Channel 

- France-Australia begin talks in submarine row

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+ Australia’s exports to China jumped 24% from a year ago to reach US$135bn as of August data: Oxford Economics

+ Australia’s central bank extended a currency swap deal with China counterpart early this year: annual report 

+ Australia unveiled 2050 net zero emissions target 

+ South Korea to ease migrant worker ban next mth to tackle labour crunch 

+ Samsung posted 28% jump in operating profit of US$13.5bn in Q3 at 3-year high

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+ ASEAN seeking to strengthen cooperation with China on green energy and carbon markets 

- Indonesia exports to EU might drop 20% without trade deal after 10th negotiation round without breakthrough: union warns 

+ Indonesia telecom tower firm Mitratel aims for country’s biggest IPO to raise up to US$1.76bn 

+ Indonesia to open giant theme park and smart city near Jakarta  

+ Indonesia adoption of cryptocurrency growing rapidly, ranks as world’s top crypto hotspot

+ Indonesia on course to become major solar power exporter 

+ Indonesian firm Medco Power to export solar-generated electricity from Riau Islands to Singapore in a pilot project 

+ Thailand foreign holdings of Thai stocks on local bourse soared 35.5% to over ฿5.09 trillion, highest in 3 years 

- Thailand govt revenue collection in fiscal 2021 falling short of target by 11.5%

+ Thailand to lift ban on alcohol consumption in Bangkok on Nov 1

+ Malaysia unveiled record RM332.1bn (US$80bn) budget to spur post-pandemic recovery 

+ Malaysia mandate public traded firms must have at least one woman director on their board starting next year 

+ YTL Power Seraya won Singapore’s 2-year trial project to import 100 MW of electricity from Malaysia 

+ Malaysia would proceed with procurement of Pfizer Covid-19 vaccine for children aged 5-11 

+ Sg economic growth in 2022 expected to be slower than in 2021 but will be above trend: MAS 

+ Sg trade does not seem to have been materially affected by disruptions in global and regional supply chain: MAS 

- Sg factory output shrank by 3.4% YoY in Sept after 10 mths of growth, on deep contraction in biomedical segment 

+ Sg plans to import 30% of energy or 4 gigawatts of green power from low-carbon sources by 2035

+ Sg residential prices up 7.5% for Q3, 6th straight consecutive quarterly increase: OrganeTee

+ Sg granted in-principal approval on pilot project to import 100 MW solar power from Indonesia 

+ HDB to have 10-year minimum occupancy period for new flat owners in prime areas 

- Sg Covid-19 daily cases breach 5000-mark for the first time  

+ JTC All Industrial Rental Index continued its rebound in Q3, overall occupancy rate stood at 90.1% YoY

+ Sg car buyers bought 517 Tesla cars in Q3, became 6th most popular car brand in Sept 

Contribution by Derek@valueinvestments chat group. Thank you.

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