China’s Jingye Group agrees outline deal to rescue British Steel


BEIJING/LONDON (Reuters) – China’s Jingye Group said on Monday it has reached a provisional deal to buy British Steel and promised to invest 1.2 billion pounds ($1.5 billion) over the next decade and save thousands of jobs.

FILE PHOTO: A general view shows the British Steel works in Scunthorpe, Britain, May 21, 2019. REUTERS/Scott Heppell/File Photo

An agreement is of major political significance as Britain prepares to elect a new government on Dec. 12. The lack of opportunities in northern England, where British Steel is based, is an election issue, as the social gap between north and south widens.

The deal has yet to be finalised, but Business Minister Andrea Leadsom said in a video clip she was optimistic it would be.

Jingye Group Chairman Li Ganpo said the ambition was to create a world-class group.

“We believe that this combination will create a powerful, profitable and sustainable business that will ensure the long-term future of thousands of jobs while producing the innovative high-quality steel products that the world needs,” he said in a statement.

The value of the deal was not disclosed. Earlier a BBC report saying a deal was imminent gave a figure of 70 million pounds ($90 million), while sources close to the talks said the price was likely closer to 50 million pounds.

Uncertainty over the future of British Steel has hung over its workforce for much of the year. It was put into compulsory liquidation in May after Greybull Capital, which bought it for one pound from Tata Steel (TISC.NS) in 2016, failed to secure funding to continue its operations.

Its closure would impact 5,000 jobs in Scunthorpe and a further 20,000 jobs in the supply chain.

British Steel, which makes high-margin, long steel products used in construction and rail, would give Jingye access to Europe’s large infrastructure market.

But it could face challenges as the European steel industry grapples with weak demand, high costs for energy and labor and exacting environmental standards.

British Steel did not respond to requests for comment.

A previous deal, announced in August, with Turkey’s military pension fund OYAK fell apart and on Monday the fund said the purchase was not commercially viable.

British commodities tycoon Sanjeev Gupta’s Liberty Steel Group has also expressed interest in buying British Steel.

EMBRACE CHINA

Henri Murison, director of the Northern Powerhouse Partnership, set up to boost the economy in the north of England, said a rescue, if finalised, would be “very welcome news”.

He said it was time to embrace cooperation with China, which is extending its international reach through its Belt and Road global development strategy. Chinese companies also own a steel plant in Serbia and its sole copper mine.

Leading trade union Unite welcomed the prospect of Chinese ownership, but cautioned there had been “a series of false dawns” for the company.

Jingye, which also operates hotels and real estate, employs 23,500 and has registered capital of 39 billion yuan ($5.58 billion), giving it the financial clout to invest.

Under the terms of the agreement, Jingye would acquire certain assets of British Steel from the Official Receiver, subject to regulatory approvals.

The assets include the steelworks at Scunthorpe and Teesside in northern England, as well as its European units FN Steel in the Netherlands and British Steel France.

FILE PHOTO: A British Steel works sign is seen in Scunthorpe, northern England, Britain, May 21, 2019. REUTERS/Scott Heppell/File Photo

Chinese ownership may be contentious, especially in the steel industry. The European Union (EU), which does not include Serbia, has agreed safeguards to protect its own steel industry from competition from cheap imports from China and elsewhere.

Britain has said it will leave the EU but has yet to agree a deal on its departure from the political and economic bloc.

John Cullen,  business recovery partner  at accountancy firm Menzies LLP, said selling the whole British Steel business “in the current trading climate would be no mean feat”.

Reporting by Min Zhang in Beijing, Barbara Lewis and Kate Holton in London, Ceyda Caglayan; editing by Guy Faulconbridge, Josephine Mason and Emelia Sithole-Matarise



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China’s NEV market may contract this year due to subsidy cut: industry association By Reuters


© Reuters. FILE PHOTO: Carrier trailer transports newly manufactured cars at a port in Dalian

By Yilei Sun and Brenda Goh

BEIJING/SHANGHAI (Reuters) – Fewer new energy vehicles (NEV) could be sold in China this year than in 2018, an official at the country’s biggest auto industry association said on Monday, as customers hold back on purchases following a government decision to cut subsidies.

Chen Shihua, assistant secretary general at China Association of Automobile Manufacturers (CAAM), made the comment on Monday after the association reported that sales of NEVs fell 45.6% in October from year-ago levels, following a 33% decline in September.

“There is a gap between sales to date and where they were last year, so according to the development trend, we may see negative growth for new energy vehicles this year,” he said.

China has been a keen supporter of NEVs and has implemented sales quota requirements for automakers. But it cut subsidies for NEVs this year as part of an overall plan to reduce subsidies, making the vehicles costlier.

Prior to the subsidy cut, the market for NEVs – which include plug-in hybrids, battery-only electric vehicles and those powered by hydrogen fuel cells – had been a bright spot, having jumped 62% last year.

While NEVs sales rose last year, the world’s largest auto market suffered its first contraction since the 1990s last year.

The trend has remained discouraging with auto sales falling for a 16th consecutive month in October, declining 4% from the same month a year earlier, and followed declines of 5.2% in September and 6.9% in August, CAAM said. September and October, known as “Golden September, Silver October” by China’s auto insiders, are regarded as the high season for sales, with customers traditionally returning to make purchases after the summer. The decline in sales during the high season has dealt a blow to industry executives’ hopes for a turnaround in the second half of this year. As recently as three years ago, automakers had enjoyed double-digit annual growth in China. But the prolonged sales decline has made domestic car makers from Geely (HK:) to Great Wall (SS:) lower their expectations for sales and profit.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Factbox: China’s love of e-commerce powers Alibaba’s Singles’ Day


SHANGHAI (Reuters) – China’s dominant e-commerce firm Alibaba Group Holding raked in $23 billion worth of sales in the first nine hours of its annual Singles’ Day shopping extravaganza on Monday, setting records as the event celebrates its 11th year.

The logo of Alibaba Group is seen during Alibaba Group’s 11.11 Singles’ Day global shopping festival at the company’s headquarters in Hangzhou, Zhejiang province, China, November 10, 2019. REUTERS/Aly Song

The 24-hour shopping event is akin to Black Friday and Cyber Monday in the United States and has become a highlight of China’s e-commerce industry, with other retailers running concurrent promotions. This year, Alibaba netted $1 billion in sales in the event’s first 68 seconds.

Here are some quick facts about China’s e-commerce’s industry:

WORLD’S BIGGEST

China is on track to book $1.94 trillion in e-commerce sales in 2019, more than three times the United States which is in second place with $586.92 billion, a report from researcher eMarketer shows.

China on its own represents 54.7% of the global e-commerce market, nearly twice the share of the next five countries combined, the report showed.

However, the country is ranked fourth when it comes to forecast e-commerce sales growth for 2019, behind Mexico, India and the Philippines, according to eMarketer.

TOP PLAYERS

Alibaba’s e-commerce marketplaces, business-to-consumer Tmall and Taobao, where both individuals and businesses set up shop, are China’s dominant shopping platforms, hosting thousands of merchants selling products as varied as T-shirts, household sundries and four-poster beds.

The firm’s competitors include longtime rival JD.com, which sources goods and sells them directly to consumers, and four-year-old Pinduoduo Inc that managed to break into the top ranks by courting China’s rural residents with deep discounts and a group-buying model.

There are also a range of other e-commerce sites that focus on different market segments, such as cosmetics, groceries and home appliances.

Competition between platforms is rife and has boiled over into the public sphere. This month, regulators summoned over 20 platforms and urged them to stop practices that could be seen as monopolistic.

SECTOR’S BACKBONE

E-commerce in China is heavily reliant on logistics companies, couriers and payment systems such as Alibaba-backed Alipay and WeChat Pay from Tencent Holdings Ltd.

Couriers STO Express Co Ltd, ZTO Express (Cayman) Inc, YTO Express Group Co Ltd, S.F. Holding Co Ltd and Yunda Holding Co Ltd send parcels for as little as 8 yuan ($1.14), making purchases online more convenient at times than offline.

Many couriers are also part of the Cainiao Smart Logistics Network, majority owned by Alibaba which co-founded it in 2013. Cainiao provides software to and shares data with warehouses, couriers and logistics firms.

JD.com manages its own logistics network, a FedEx-style parcel delivery service which it started last year.

HOW ARE THEY FARING?

The rapid growth of Alibaba and JD.com has tracked that of China’s economy and the expansion of its middle class over the past two decades.

This, however, has also made them vulnerable, as the economy slows to its weakest pace in almost three decades and retail sales post their slowest growth since early 2003.

Alibaba said revenue for the quarter to September-end for its core commerce business rose 40% year-on-year, versus 56% in the same period in 2018.

Their next step, as a result, has been to diversify, with Alibaba moving into financial services, cloud computing and artificial intelligence (AI), while JD.com has invested in AI to improve its logistics and advertising capabilities.

They are also doubling down on reaching consumers in China’s third- and fourth-tier cities, where Pinduoduo currently has a foothold, citing more promising, higher growth.

Reporting by Brenda Goh; Editing by Christopher Cushing and Himani Sarkar



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China’s Exports, Imports Fall Less Than Expected in October By Investing.com


© Reuters.

Investing.com – China’s exports and imports fell less than expected in October, the country’s customs showed on Friday.

In dollar terms, fell 0.9% during the month from a year earlier. The fall was less than the expected 3.9%.

Meanwhile, were down 6.4%, also less than the previous forecast of 8.9%.

for October was $42.81 billion. Analysts had forecast the trade balance to be $40.83 billion.

In yuan terms, trade balance came in at CNY 301.38 billion versus the expected CNY 220.20 billion.

Chinese stocks opened mixed earlier in the day but traded higher following the release of the data.

The Shanghai Component gained 0.4%, while the climbed 0.8% by 10:52 PM ET (02:52 GMT).

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China’s Trade Data Show Brighter Exports, Weak Domestic Demand By Bloomberg



(Bloomberg) — China’s exports declined less than expected in October as optimism rose about an interim trade deal with the U.S., while imports contracted for a sixth straight month.

Exports decreased 0.9% in dollar terms in October from a year earlier, while imports dropped by 6.4%, the customs administration said Friday. That left a trade surplus of $42.81 billion for the month.

Key Insights

  • The improvement in exports will provide some relief to companies, which are being squeezed by falling profits amid factory deflation. Falling imports point to a slowing domestic economy.
  • The U.S. and China have agreed to roll back tariffs on each other’s goods in phases as they work toward a deal, both sides said Thursday.
  • China’s trade surplus with the U.S. was $26.42 billion in October; Exports to the U.S. are now down 11.3% in dollar terms in the year to date from the same period in 2018.
  • At the same time, the date of the summit may be pushed back to December as the two sides wrangle over the details.
  • “There are some signs of stabilization for exporters. And with the possible rollback of tariffs, next year is very likely to stage a recovery for exports,”said Gai Xinzhe, a senior analyst at Sino-Ocean Capital in Beijing.

What Bloomberg’s Economists Say..

“A slower pace of decline in exports in October offers some encouragement for the economy’s performance heading into year-end. That said, a continued slide in imports, coupled with contraction in the new orders component of the official manufacturing PMI, suggest domestic demand remains weak — tempering any optimism about growth bottoming out near term.”

David Qu and Qian Wan, Bloomberg Economics

For the full note click here

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  • Economists had forecast that exports would drop by 3.9% while imports would contract by 7.8%.
  • “The slightly improving imports may be largely due to the moderate pickup in domestic infrastructure investment, and it may last for some time,” said Betty Wang, senior China economist at Australia & New Zealand Banking Group Ltd. in Hong Kong. “On exports, the market is getting excited about the phase-one deal, but we think that is only the short-term optimism instead of long-term certainty. There is still lack of clear sign of recovery. It is too early to say anything now.”

(Updates with exports to U.S. in Key Insights section)

To contact Bloomberg News staff for this story: Miao Han in Beijing at mhan22@bloomberg.net;Tomoko Sato in Tokyo at tsato3@bloomberg.net

To contact the editors responsible for this story: Jeffrey Black at jblack25@bloomberg.net, Sharon Chen

©2019 Bloomberg L.P.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China’s Oct. exports fall, but less than expected as trade war grinds on By Reuters


© Reuters. FILE PHOTO: Containers are seen at a port in Ningbo, Zhejiang

By Lusha Zhang and Ryan Woo

BEIJING (Reuters) – China’s exports and imports contracted less than expected in October, providing some relief for the economy as Beijing tries to reach a partial trade deal with Washington.

But even if a U.S.-China trade deal is signed soon, economists say it is unlikely to help boost exports and manufacturing for some time yet and could still mean more stimulus is needed from Beijing to avert a sharper downturn.

China’s October exports fell for the third straight month, down 0.9% from a year earlier, customs data showed on Friday, less than a 3.9% fall forecast in a Reuters poll and September’s 3.2% contraction.

“Even if the “phase one” U.S.-China trade deal crosses the finish line, it is unlikely to alleviate the main headwinds facing exporters and outbound shipments look set to remain weak in the coming months,” said Martin Rasmussen, China economist at Capital Economics.

He attributed the rise in exports to a pick-up in U.S. demand after both countries outlined an interim deal and Washington suspended a threatened tariff hike set for Oct. 15.

There were other bright spots in the data. Exports to the United States in October fell 16.2%, less than a 21.9% drop the previous month, according to Reuters calculation based on customs data.

Betty Wang, senior China economist at ANZ, said anecdotal evidence also showed exports may have been boosted as Chinese firms rushed out hi-tech shipments after the U.S. government put some of the country’s tech firms on a trade blacklist.

If a partial deal is reached this month, it is widely expected to include a U.S. pledge to scrap tariffs scheduled for Dec. 15 on about $156 billion worth of Chinese imports, including cell phones, laptop computers and toys. 

So far, U.S. President Donald Trump has only cancelled a scheduled Oct. 15 tariff increase on $250 billion goods.

China’s imports shrank for the sixth consecutive month, though the 6.4% drop was smaller than an expected 8.9% and September’s 8.5% decline.

That left China with a trade surplus of $42.81 billion in October, versus September’s $39.65 billion surplus. Analysts had forecast a $40.83 billion surplus.

Despite the more modest drop in imports, domestic demand appeared to remain weak, with imports of iron ore and falling.

The trade data lines up with recent readings on shrinking factory activity and bleak producer prices. The slowdown points to lingering weakness in domestic demand and the limited impact of policy stimulus so far.

TARIFF ROLLBACK?

Beijing and Washington have been locked in a trade feud for 16 months, but hopes have risen that an initial deal may be signed soon.

In a new sign of progress that lifted market sentiment, Beijing and Washington agreed to roll back tariffs on each other’s goods as part of the first phase of a trade deal, officials from both sides said on Thursday.

The Chinese commerce ministry, without laying out a timetable, said the two countries had agreed to cancel the tariffs in phases.

In what could be another gesture to boost optimism, China’s state news agency Xinhua reported late on Thursday that the Chinese customs and Ministry of Agriculture are considering removing restrictions on U.S. poultry imports.

China’s trade surplus with the United States was at $26.42 billion in October, up from $25.88 billion in September, according to Reuters calculation based on customs data.

Economists and analysts warn that the path toward a full deal is still highly uncertain and expect that a partial trade deal may only relieve some pressure on the world’s second-largest economy.

“We remain cautious on this. It is unlikely that the bulk of existing tariffs will be removed soon and other types of restrictions are also coming, implying decoupling and tension,” said Louis Kuijs, head of Asia economics at Oxford Economics.

Kuijs and others noted an improvement in import volumes, which could continue to gradually recover especially as local government step up infrastructure spending.

China’s third-quarter economic growth cooled to its weakest pace in almost three decades hurt by soft global demand, slowing consumption at home and heightened trade risks.

To boost credit, the People’s Bank of China cut the interest rate on its one-year medium-term lending facility (MLF) loans on Tuesday for the first time since early 2016.

Analysts said the cut, while modest, may be a sign the central bank is turning more proactive, following a slew of downbeat economic data suggesting more stimulus is needed soon.



China’s October exports, imports to contract at sharper pace: Reuters poll By Reuters



BEIJING (Reuters) – China’s exports and imports probably fell at a slightly faster rate in October, pointing to a worsening outlook for the country’s manufacturers as Beijing remains embroiled in a trade standoff with Washington, a Reuters poll showed.

The forecasts come despite optimism that a first-phase trade deal could be signed this month between China and the United States to resolve a 16-month long trade war that has raised the risk of a global recession and roiled financial markets.

The “phase one” deal is widely expected to include a U.S. pledge to scrap tariffs scheduled for Dec. 15 on about $156 billion worth of Chinese imports, including cell phones, laptop computers and toys.

China’s October exports are expected to have contracted for a third month, falling 3.9% from a year earlier, according to the median estimate of 26 economists in the poll, worsening from a 3.2% drop in September.

The existing tariffs, including the latest additional levies by the United States on Chinese imports from Sept. 1, have hit the county’s outbound shipments, along with stubbornly weak global demand.

That is also evidenced by worsening export orders in an official factory survey.

Though the possibility of a thaw in tense trade relations between the world’s top two economies is rising, economists warn the path towards a full deal is still highly uncertain and expect that a partial trade deal may only relieve some of the pressure on the world’s second-largest economy.

So far, U.S. President Donald Trump has only canceled a scheduled Oct. 15 tariff increase on $250 billion goods. And U.S. officials said they are still considering the fate of the Dec. 15 tariffs on Chinese-made goods.

“The September and scheduled December tariff hikes will likely weigh on exports and growth in the coming two quarters. Higher tariffs and trade war uncertainties may continue to hurt corporate earnings and manufacturing sector investment,” analysts with UBS wrote in a note.

Imports, meanwhile, are also likely to remain in contraction, shrinking 8.9% from a year earlier, the sharpest drop since July 2016, versus an 8.5% decline in September, the poll showed.

The forecasts point to a rocky outlook ahead for the trade-reliant economy in the last quarter of the year, despite more than a year of growth boosting measures.

China’s third-quarter economic growth slowed more than expected to its weakest pace in almost three decades, with gross domestic product rising just 6.0% on year, weighed down by cooling domestic demand, sluggish investment and weak exports.

China on Tuesday kicked off a giant import fair in Shanghai, trying to showcase its free trade credentials, temper criticism of its policies and deepen its global economic influence.

But critics say the week-long Chinese buying spree once a year does little to address structural concerns, including weak intellectual property protection, entry barriers and the lack of a level playing field for foreign businesses in China.

In a reassurance to investors worries that higher inflation could prevent the central government from delivering fresh stimulus measures, China’s central bank cut the interest rate on its one-year medium-term lending facility (MLF) loans on Tuesday for the first time since early 2016.

Analysts said the cut, while modest, may be a sign the central bank is turning more proactive, following a slew of downbeat economic data suggest more stimulus is needed soon.

“With economic activity likely to come under further pressure in the months ahead, we think more easing will be needed to prevent growth from slowing too sharply. We expect another 70 (basis points) of reductions in the MLF rate by the middle of next year,” analysts at Capital Economics said.



China’s factory activity shrinks at sharper pace, services weaken as risks grow By Reuters


© Reuters. Worker inspects a tunnel boring machine (TBM) at a production facility of China Railway Engineering Equipment Group in Zhengzhou

By Gabriel Crossley and Ryan Woo

BEIJING (Reuters) – Factory activity in China shrank for the sixth straight month in October and by more than expected, while service sector growth eased as firms grapple with the weakest economic growth in nearly 30 years.

The world’s second-largest economy is facing heightened risks from slowing global demand and the Sino-U.S. trade war, adding pressure on policymakers to roll out more stimulus to avoid a sharper slowdown and bigger job losses.

The Purchasing Managers’ Index (PMI) fell to 49.3 in October, China’s National Bureau of Statistics said on Thursday, versus 49.8 in September. The 50-point mark separates growth from contraction on a monthly basis.

Economists polled by Reuters had expected the reading would be unchanged from September.

Weighed down by cooling domestic demand, sluggish investment and a protracted trade war with the United States, China’s economic growth slowed to a near 30-year low of 6.0% in the third quarter, raising expectations that Beijing will need to roll out more support measures soon.

New export orders fell for the 17th month in a row in October, with the sub-index down to 47.0 from 48.2 in the previous month.

Total new orders, which includes those for export and domestic use, fell back to contractionary territory and erased September’s fleeting growth, suggesting continued weakness in demand at home.

Demand contraction would put a dent on prices and further chip away the already-thin margin for manufacturers. In September, China’s producer prices posted the steepest decline in more than three years, while industrial profits shrank for the second month.

Factories continued to shed jobs in October on weakening demand and rising business uncertainties. The sub-index for employment was at 47.3 in October compared with 47.0 the previous month.

China’s manufacturing sector will remain under pressure in the coming months as the nearly 16-months long Sino-U.S. trade war remains unresolved although Washington and Beijing are working on a first-phase trade accord that could be finalised soon.

But even if a “phase one” trade deal were signed it would be unlikely to have a significant positive impact on industrial activity, said Raymond Yeung, ANZ’s chief Greater China economist in Hong Kong. Slumping price indexes in both the manufacturing and services PMIs point to increasing deflationary risk amid a pointed slowdown in economic momentum, he said.

Activity at larger firms slipped back into contractionary territory after a slight recovery in September. Gauges of activity at small- and medium-sized firms continued to be even lower.

“The official PMIs fell by more than expected this month, reinforcing our view that the improvement at the end of Q3 didn’t mark the start of a sustained recovery,” said Julian Evans-Pritchard, senior China economist at Capital Economics.

He said in a research note the construction index picked up, suggesting that building activity remained a bright spot, but adding this was overshadowed by a large drop in the index for service sector activity.

Growth in China’s services sector activity slowed in October, flagging a further weakening in domestic demand.

The official services PMI fell to 52.8 from 53.7 in September, the lowest it has been since February 2016 but still above the 50-mark that separates contraction from expansion, according to a separate NBS survey.

Beijing has been counting on robust services firms to partly offset sluggish domestic and global demand for its manufactured products.

The services sector, which makes up more than 50% of the economy, has been propped up by Chinese consumers’ rising wages and robust spending power in recent years. However, the services sector cooled late last year amid a broader economic downturn.

“We expect the official manufacturing PMI to remain sluggish in coming months, the growth slowdown could gather pace, and markets could become more volatile in coming months,” said analysts from Nomura in a note, adding that Beijing will likely ramp up stimulus measures in the coming quarters.

GROWTH FEARS

The ruling Communist Party’s People’s Daily said stabilising growth should be made more of a priority. The commentary published on Thursday called for expanding investment in infrastructure where it is needed.

A Reuters poll showed China’s gross domestic product growth is expected to slow to 6.2% in 2019 and then hit 5.9% in 2020.

“Current economic conditions are very similar to 2009,” said ANZ’s Yeung, but he thinks Beijing will not launch a major stimulus as it did then.

While there is room for lower rates, Yeung said Beijing is more likely to rely on industrial policy and fiscal support measures to keep the slowdown gradual and ensure a so-called “soft landing” for the economy.

China’s southern province of Guangdong plans to use some of its 2020 bond issuance quota to issue debt as early as November, three sources with knowledge of the situation told Reuters.

Local government bond issuance typically begins in March but the statistics bureau has said the country would front-load some 2020 special local government bond issuance to this year.



China’s bitcoin miner Canaan Creative files for $400 million IPO on Nasdaq By Reuters


© Reuters. FILE PHOTO: Picture illustration of a small toy figurine and representations of the Bitcoin virtual currency displayed in front of an image of China’s flag

BEIJING (Reuters) – Canaan Creative, one of China’s biggest bitcoin mining hardware makers, filed to publicly list on the Nasdaq on Monday to raise $400 million, marking at least its third attempt to do so after previous failed tries in mainland China and Hong Kong.

The Hangzhou-based company, which describes itself as the world’s second largest bitcoin mining machine designer and maker in its prospectus, said it wanted to use the cash to fund research into artificial intelligence and blockchain research, as well as pay off debts.

It did not say why it had decided to try again for another initial public offering at this time. It tried to list itself in China three years ago through a reverse merger by buying a Shandong-based electric equipment maker and then again filed for a Hong Kong float last year, however both plans fell through as regulators had doubts about its business model and prospects.

Its application on Nasdaq comes shortly after Chinese President Xi Jinping made comments last week encouraging the development of blockchain technology, which sent the shares of blockchain and digital currency-linked firms, and the bitcoin price, soaring.

The fate of bitcoin and bitcoin mining in China, however, remains unclear as Beijing shut down local cryptocurrency exchanges in 2017 and in April signaled that it wants to eliminate bitcoin mining in the country. Chinese state media have also said that blockchain innovation should not be seen as a boost for virtual currency speculation.

Founded in 2013, Canaan designs and sells high-performance integrated circuits and is behind the Avalon series of bitcoin mining machines. Banks working on Canaan’s Nasdaq IPO are Credit Suisse (SIX:), Citigroup (NYSE:), China Renaissance and CMB International.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China’s factory activity seen contracting for sixth month on trade pressure: Reuters poll By Reuters


© Reuters. Workers check on seamless steel pipes at a factory of a steel products manufacturer in Cangzhou, Hebei

BEIJING (Reuters) – China’s factory activity is expected to have shrunk for the sixth month in October, a Reuters poll showed, suggesting hardly any let up in pressure on the domestic and export sectors from slowing global demand and a trade war with the United States.

The official Purchasing Managers’ Index (PMI) for October was seen at 49.8, unchanged from September, but still below the 50-point mark that separates expansion from contraction, according to the median forecasts of 35 economists.

The extended downturn in manufacturing reinforces evidence of further weakening in the world’s second-biggest economy and puts pressure on authorities to roll out more stimulus to avert a sharper slowdown and large-scale job losses.

While U.S. and Chinese trade negotiators are working on nailing down a “Phase 1” trade deal for their presidents to sign next month, analysts and investors remain cautious given there are still a number of differences between the two sides on key issues.

Many expect a durable resolution to the protracted trade war is unlikely in the near term. China still faces new U.S. tariffs set to kick in on Dec. 15, on top of the existing 25% tariffs on $250 billion of Chinese imports.

That is likely to weigh on businesses and consumers.

China’s gross domestic product growth slowed more than expected to 6.0% year-on-year in the third quarter, its weakest pace in almost three decades.

For the whole of 2019, GDP growth is expected to cool to 6.2% and then hit 5.9% in 2020, according to a Reuters poll, underlining the growing challenges faced by Beijing in its efforts to stabilise the economy.

In September, a slide in China’s exports picked up pace while imports contracted for a fifth straight month, official data showed.

Profits at China’s industrial firms fell in September for the second consecutive month as the cooling economy and trade war weighed on corporate balance sheets.

For January-September, industrial firms earned profits of 4.59 trillion yuan, down 2.1% from a year earlier, and worse than the 1.7% reading in the first eight months.

China unexpectedly kept unchanged its new benchmark lending rate in October after reductions in August and September, suggesting Beijing is keen to avoid overly loosening monetary policy for fear it may push up already-high debt levels across the economy.

The government has been trying to spur domestic demand for over a year through higher infrastructure spending, but the measures have been slow to gain traction.

A private survey – the Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI)- which focuses more on small- and medium-sized, export-driven Chinese firms, is expected to show factory activity expanded in October.

However, it is still forecast to show subdued growth with the headline gauge edging lower to 51.0 from 51.4 in September.

The official PMI and its sister survey on the services sector will be released on Thursday.

The Caixin manufacturing PMI will be published on Friday and the Caixin services PMI survey will be out on Nov. 5.

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