Major International Business Headlines Brief::: 10 September 2020

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Major International Business Headlines Brief::: 10 September 2020

 


 

 


 <http://www.nedbank.co.zw/> 

 


 

 


 

 

ü  Covid vaccine: 8,000 jumbo jets needed to deliver doses globally, says
IATA

ü  Trade talks: Why chicken, cheese, and cod are a tricky menu

ü  Yum China's HK listing is the latest 'homecoming'

ü  JC Penney: Landlords plot rescue for department store

ü  Morrisons sales rise but profits hit by Covid costs

ü  Amazon pays £290m in UK tax as sales surge to £14bn

ü  David Beckham's Guild Esports to float on London stock market

ü  Ryanair boss Michael O'Leary calls UK travel quarantine 'a shambles'

ü  Russian state hackers suspected in targeting Biden campaign firm –
sources

ü  Wall Street sees a bright side in 'healthy' tech selloff

ü  Reform hopes rise as China focuses on inward economic shift

ü  Facebook, Google, Twitter urged by EU to do more against fake news

ü  European shares inch higher with eyes on ECB

ü  Toyota's research arm says to form an $800 million investment fund

ü  Caution reigns in wake of Nasdaq bounce, euro drifts higher ahead of ECB
meeting

 

 

 

 

 


 <mailto:info at bulls.co.zw> 

 


 


Covid vaccine: 8,000 jumbo jets needed to deliver doses globally, says IATA

Shipping a coronavirus vaccine around the world will be the "largest
transport challenge ever" according to the airline industry.

 

The equivalent of 8,000 Boeing 747s will be needed, the International Air
Transport Association (IATA) has said.

 

There is no Covid-19 vaccine yet, but IATA is already working with airlines,
airports, global health bodies and drug firms on a global airlift plan.

 

The distribution programme assumes only one dose per person is needed.

 

"Safely delivering Covid-19 vaccines will be the mission of the century for
the global air cargo industry. But it won't happen without careful advance
planning. And the time for that is now," said IATA's chief executive
Alexandre de Juniac.

 

While airlines have been shifting their focus onto delivering cargo during
the severe downturn in passenger flights, shipping vaccines is far more
complex.

 

Not all planes are suitable for delivering vaccines as they need a typical
temperature range of between 2 and 8C for transporting drugs. Some vaccines
may require frozen temperatures which would exclude more aircraft.

 

"We know the procedures well. What we need to do is scale them up to the
magnitude that will be required," added Glyn Hughes, the industry body's
head of cargo.

 

Flights to certain parts of the world, including some areas of South East
Asia, will be critical as they lack vaccine-production capabilities, he
added.

 

Distributing a vaccine across Africa would be "impossible" right now IATA
says given the lack of cargo capacity, size of the region and the
complexities of border crossings.

 

Transportation will need "almost military precision" and will require cool
facilities across a network of locations where the vaccine will be stored.

 

About 140 vaccines are in early development, and around two dozen are now
being tested on people in clinical trials.

 

One is being developed by the University of Oxford that is already in an
advanced stage of testing.

 

IATA has urged governments to begin careful planning now to ensure they are
fully prepared once vaccines are approved and available for distribution.

 

Along with making sure they are handled and transported at controlled
temperatures, security is another issue.

 

"Vaccines will be highly valuable commodities. Arrangements must be in place
to keep ensure that shipments remain secure from tampering and theft," added
IATA.--bbc

 

 

 

Trade talks: Why chicken, cheese, and cod are a tricky menu

Coronavirus permitting, there'll be fireworks and parties to mark the
arrival of 2021.

 

But as the clock strikes midnight, it'll also mark the end of the Brexit
transition period. Trading relationships that have been in place for years
will go up in smoke.

 

Civil servants are racing against the clock to replace these relationships
with something even more dazzling and befitting of modern "Global Britain".

 

This week trade negotiators will pursue simultaneous talks with three key UK
partners - the United States, Japan and European Union (EU). If they fail,
businesses and households could pay a high - and very unwelcome - price.

 

What is the UK trying to do?

 

It's been called "cherry-picking" by Brussels. But the UK government would
see its negotiations there as trying to replace its existing relationship
with the EU with one that suits its needs better, while trying to avoid the
imposition of tariffs where there are currently none.

 

With the US, it's designing an arrangement from scratch. And in the case of
Japan, it's simply replicating a deal that that country already has with the
EU - with a few added extras, such as agreements on digital trade.

 

Trade deals aim to increase the choice of what's available from other
countries - and lower prices. But that has to be balanced by protecting the
needs of businesses at home. And this is the tricky bit.

 

While the UK has managed to largely replicate the EU's deal with Japan, the
issue of cheese, such as Stilton, has caused a stink.

 

Britain wants better access for its cheese farmers; Japan isn't keen. Is
this really worth the strife, given that Japan only buys about £2m worth of
British cheese? Well, it's not about the current picture, but the potential
for growth.

 

Ditto the US and its chickens. America has made no secret of the fact that
it wants its farmers to have a bigger presence on British plates. That's
currently up for discussion, and may cause ructions.

 

But what isn't being negotiated is a lowering of standards to American
levels - such as the conditions in which chicken can be raised, the reason
they're rinsed in chlorine. That responsibility falls to the UK Food
Standards Agency.

 

And hard to swallow in Brussels has been the UK's demand for the right to
catch more fish in surrounding waters. Fishing makes up less than 0.2% of
the UK economy - but, again, it's about the potential gains.

 

And it's about keeping voters happy: trade deals are as political as they
are economic. So even talks over small-fry matters mean trade deals take
years to hammer out.

 

What are the chances?

Ambitions that a deal with Japan, Britain's first major trophy in the Brexit
era, could be sewn up by the end of July were dashed. And that's with a
partner that accounts for just 2% of British exports. We're edging closer to
the finish line, but it doesn't bode well for talks elsewhere.

 

Meanwhile, hopes for a deal with the US, which buys almost a fifth of
British exports, ahead of the November election have faded. Officials are
now quietly pinning their hopes on an agreement by next spring.

 

As for the EU, the continued impasse where there was once an aim of a deal
by October has seen the chances of a no (trade) deal rise sharply.

 

What if there's no deal?

If there is no agreement by the end of the year, those countries' imports
will face the same charges and rules as those from any other nation with
which the UK doesn't have a deal. They'll have the new UK Global Tariff
imposed on them.

 

Crucially, that would mean that over half of good imports, by value, from
the EU would face extra charges, compared with none at present.

 

The biggest rises would be in the price of cars, and foods such as lamb and
beef, where tariffs are being retained to protect British producers. The
British Retail Consortium has warned of price hikes on staples from olive
oil to cucumbers.

 

Under a previous no-deal plan, the Office for Budget Responsibility reckoned
the total cost of tariffs could mount into the billions - and that's with
fewer tariffs than now envisaged.

 

Those costs would be born by businesses and households, squeezing budgets
and the ability to create jobs, when the economy least needs it. And that's
before taking into account the cost of planning for businesses and potential
for delays at the border.--bbc

 

 

 

Yum China's HK listing is the latest 'homecoming'

Yum China, which runs KFC and Pizza Hut restaurants, listed its shares on
the Hong Kong stock exchange on Thursday amid growing tensions with the US.

 

The fast good giant is also listed in the US where Chinese companies are
coming under increased scrutiny.

 

It is the latest so-called homecoming as China-based firms shift their focus
back onto local markets.

 

Yum China runs around 10,000 restaurants across mainland China in more than
1,400 cities and towns.

 

The company's share price dropped more than 6% on its stock market debut,
although it has raised about $2.2bn (£1.7bn) from the share listing.

 

The move by Yum China, which has traded on the New York Stock Exchange since
2016, comes against a backdrop of tensions between Washington and Beijing.

 

The Trump administration has laid out plans for Chinese companies listed on
the New York Stock Exchange and tech-focused Nasdaq to provide American
regulators with access to their audit reports.

 

Those that don't could be forced to delist and exit US markets.

 

Other "homecoming" listings in Hong Kong this year include internet groups
NetEase and JD.com.

 

The weaker-than-expected stock market debut for Yum China followed strong
demand for its shares during this month's initial public offering (IPO).
Demand for its shares had initially outstripped supply by more than 50
times.

 

Hong Kong-based investment firm Jefferies said the listing may have been
dampened due to rising China-US tensions and Yum China's growth prospects
outside of its main brands, which include Taco Bell.

 

“It might need additional funding should it expand in coffee or other new
models aggressively,” Jefferies said.

 

Yum China also has a stake in Chinese online shopping platform Meituan which
offers entertainment, dining, food delivery and travel services.

 

"Its investment in Meituan has been very successful," Jefferies added.

 

Earlier this week, shares in Chinese bottled water company Nongfu Spring
jumped around 80% following its Hong Kong debut making its founder Zhong
Shanshan China's third-richest person.

 

Alibaba-backed financial technology group Ant also has a Hong Kong stock
market debut planned which could raise a record $30bn.--bbc

 

 

 

JC Penney: Landlords plot rescue for department store

Two of America's biggest shopping mall owners have agreed to take on JC
Penney's retail operations to save the department store from closing.

 

Simon Property Group and Brookfield Property Partners said they would keep
the majority of JC Penney's stores open, potentially saving 70,000 jobs.

 

JC Penney had about 850 sites and employed more than 80,000 people when it
declared bankruptcy in May.

 

The plan marks the landlords' latest efforts to fend off retail's struggles.

 

Last month, Simon Property Group announced deals with other partners to buy
clothing firms Brooks Brothers and Lucky Brand Jeans, which had filed for
bankruptcy after mass store closures triggered by the coronavirus pandemic.

 

In February, Simon also teamed up with Brookfield to buy Forever 21, after
the clothing chain declared bankruptcy.

 

Retail struggles

The woes of JC Penney, founded in 1902 in Wyoming, also predate the
pandemic.

 

The company thrived during the 20th century, growing to become a staple of
shopping malls throughout the United States. But competition from online
shopping and other rivals saw sales slide in recent years.

 

The firm has since closed hundreds of stores and cut thousands of jobs. Last
year it reported sales of $10.7bn (£8.2bn), a decrease of more than $7bn in
10 years.

 

The pandemic hastened that decline, forcing the temporary closure of its
stores. It has since closed more than 150 locations.

 

The tentative deal to buy JC Penney, which requires court approval to move
forward, would see Simon and Brookfield invest about $300m into the company
and assume $500m in debt, a lawyer for the company said at a court hearing
on Wednesday.

 

The firm is also seeking new financing, while other companies are expected
to win ownership of roughly 160 stores, in exchange for forgiving some of
the JC Penney's $5bn debt load. About 650 stores are expected to stay open.

 

JC Penney, which had warned previously that rescue talks were not going
well, said it planned to seek court approval of a final deal in October.

 

"There have been twists and turns but I think we are at a place now where we
have significant momentum behind us," attorney Joshua Sussberg said.

 

"Simon, Brookfield, the lenders and the company, the creditors committee are
all committed to moving this forward quickly and saving JC Penney as we know
it."--bbc

 

 

 

 

Morrisons sales rise but profits hit by Covid costs

Sales at Morrisons surged in the first half of its financial year but the
supermarket saw profits drop because of coronavirus-related costs.

 

Morrisons said like-for-like sales, excluding fuel, rose by 8.7% in the six
months to the beginning of August.

 

However, pre-tax profit fell by a quarter after its costs rose by £155m to
deal with the pandemic, including temporary workers and staff bonuses.

 

It also said poor fuel sales hit income as more people worked from home.

 

However, Morrisons said the extra costs had been partly offset by four
months of business rates relief of £93m,

 

In March, all UK retailers were given a one-year business rates holiday as
the country entered lockdown. The decision prompted criticism because
supermarkets have seen sales grow strongly during the pandemic.--bbc

 

 

Amazon pays £290m in UK tax as sales surge to £14bn

Online retail giant Amazon paid £293m in tax in the UK last year, while its
sales surged 26% to £13.73bn.

 

The firm, which employs 33,000 people in the UK, said the taxes included
business rates, corporation tax, stamp duty and other contributions.

 

Amazon and other tech firms have faced scrutiny over how much tax they pay
in the UK, prompting the government to launch a digital sales tax in April.

 

Amazon said it pays "all taxes required in the UK".

 

"We are investing heavily in creating jobs and infrastructure across the UK
- more than £23bn since 2010," the company said in a statement.

 

"We pay all taxes required in the UK and every country where we operate," it
said.

 

"Corporation tax is based on profits, not revenues, and our profits have
remained low given retail is a highly-competitive, low margin business and
we continue to invest heavily."

 

Amazon to create 7,000 UK jobs

Amazon tax bill cut by share awards

In April, the UK launched a 2% tax on digital sales amid concerns that big
tech firms we re-routing their profits through low tax jurisdictions.

 

Defending the plan, Chancellor Rishi Sunak said in June that the coronavirus
crisis had made tech giants even "more powerful and more profitable".

 

He added that firms like Google, Amazon and Facebook needed "to pay their
fair share of tax".

 

Amazon has been expanding in the UK this year, as more people shop online
due to lockdown restrictions.

 

The company said last week it would create a further 7,000 UK jobs this year
to meet growing demand, taking its total permanent workforce to 40,000 by
the end of the year.

 

It is also recruiting 20,000 seasonal posts for the festive period.

 

Amazon is led by world's richest man Jeff Bezos, whose personal fortune rose
as high as $200bn (£155bn) in recent weeks as tech firms' stock market
valuations soared.

 

The company as a whole posted sales of $281bn for 2019 and net profits of
$11.6bn.-bbc

 

 

David Beckham's Guild Esports to float on London stock market

An e-sports company in which David Beckham owns a significant stake is
seeking to raise £20m by listing its shares on the London Stock Exchange.

 

Guild Esports will be the first in the UK to offer fans the chance to put
money into backing its teams of gamers.

 

E-sports, where spectators watch players video gaming, has seen its
popularity rise during lockdown.

 

The company plans to field teams in the global online games Fortnite, CS:GO,
Rocket League and Fifa.

 

It wants to build up its teams' skills using systems similar to the Premier
League's talent academics.

 

Prize and sponsorship money for e-sports run in the millions and audiences
run to more than 100 million for some events, outstripping those for major
sporting events such as Wimbledon and the Tour de France.

 

Figures from from Newzoo, a games market insights company, show that 2019,
e-sports had a total of 443 million viewers in 2020. Newzoo predicts the
market will grow to 646 million viewers by 2023.

 

'Global influence'

The shares will initially be offered to large investors next month, but
afterwards will trade freely on the stock market where anyone can buy them.

 

Money raised from the initial share placing will be used to expand the
business, including recruiting new players.

 

The investment further extends David Beckham's wide-ranging business
interests, which include fashion, fragrances, whisky and a football club in
Florida that he co-owns.

 

Guild Esports said he would use his "global influence and following to
support the development of the company's brand and business".

 

Beckham is one of the founding shareholders in the business, holding what is
described as a "significant minority stake", although the exact investment
is undisclosed.

 

He is not the first footballer to spot the potential opportunities in
e-sports. Wales and Real Madrid player Gareth Bale launched his e-sports
organisation, Ellevens Esports, earlier this year.

 

Carleton Curtis, the executive chairman of Guild Esports, said: "Guild will
be the first e-sports franchise to join the London stock market.

 

"It will provide us with the cache, credibility and capital to fulfil our
ambition to become one of the world's top 10 e-sports franchises within
three years."--bbc

 

 

 

Ryanair boss Michael O'Leary calls UK travel quarantine 'a shambles'

The UK's travel quarantine policy is a "shambles of mismanagement", Ryanair
boss Michael O'Leary has said.

 

In an interview with the BBC, Mr O'Leary said the UK and Irish Governments
"stand indicted".

 

He said the UK quarantine was "lumpy and defective" and that the UK needed
to use testing at airports to help the safe return of international travel.

 

Boris Johnson has said travel quarantines are "vital" to fight Covid-19 as
testing can be unreliable.

 

The policy requires travellers to high-risk countries to isolate for two
weeks on their return to the UK.

 

Mr O'Leary described the record of the UK government as "pretty poor in
almost all respects of dealing with Covid".

 

"They were late into lockdown, they were late into testing, they were late
into face masks, now they're pooh-poohing testing. Testing is the only way
forward here."

 

He cited the Italian and German governments, who allowed intra-European
travel from 1 July, as managing the virus well thanks to "a much more
aggressive test and trace system".

 

Mr O'Leary said he supported a two-test system, where a passenger would be
tested on arrival at an airport and then tested five days later, and if they
got two negative tests they would leave quarantine early.

 

UK government sources have indicated that they are looking at system where
the two tests would be eight days apart to further minimise the risk of
"false negative" results.

 

But Mr O'Leary said a two-test system mitigated against business travel,
noting: "The City of London depends on this type of travel."

 

He also said that the UK tourism sector needed European visitors, and he
questioned why the UK was relying on a "failed quarantine" policy rather
than a better test-and-trace system and testing at airports.

 

"You're much more likely to get Covid in Bolton rather than Barcelona," he
said.

 

Asked whether he had spoken to the Transport Secretary, Grant Shapps about
all of this he said: "Honestly, talking to Grant Shapps is a waste of time

he is the messenger boy for whatever goes on in Number 10 Downing Street."

 

When asked if he had talked to anyone in Number 10, Mr O'Leary said: "I
wouldn't waste my time talking to anyone in the UK government at the moment
given their abysmal record at mismanaging Covid."

 

He claimed that short-haul intra-European business travel and visits "will
return very quickly, once there is an identifiable vaccine".

 

Last week the prime minister appeared to pour cold water over the idea of
tests at airports, saying it would only identify 7% of Covid-19 cases.

 

"That's why the quarantine system that we have has got to be an important
part of our repertoire, of our toolbox, in fighting Covid," he said.

 

"What we don't want to see is reinfection coming in from abroad and
quarantine is a vital part of that."--bbc

 

 

 

 

 

Russian state hackers suspected in targeting Biden campaign firm – sources

WASHINGTON (Reuters) - Microsoft Corp (MSFT.O) recently alerted one of
Democratic presidential candidate Joe Biden’s main election campaign
advisory firms that it had been targeted by suspected Russian state-backed
hackers, according to three people briefed on the matter.

 

The hacking attempts targeted staff at Washington-based SKDKnickerbocker, a
campaign strategy and communications firm working with Biden and other
prominent Democrats, over the past two months, the sources said.

 

A person familiar with SKDK’s response to the attempts said the hackers
failed to gain access to the firm’s networks. “They are well-defended, so
there has been no breach,” the person said.

 

SKDK Vice Chair Hilary Rosen declined to comment. A Biden spokesman did not
respond to a request for comment. 

 

The hacking attempts on SKDK come as U.S. intelligence agencies have raised
alarms about possible efforts by foreign governments to interfere in the
November presidential election.

 

Investigations by former special counsel Robert Mueller and the Senate
intelligence committee both concluded that affiliates of the Russian
government interfered in the 2016 presidential election, and Mueller has
warned that Russia was meddling in the current campaign.

 

One of the sources said it was not clear whether Biden’s campaign was the
target or whether the Russians were attempting to gain access to information
about other SKDK clients.

 

SKDK managing director Anita Dunn was a White House communications director
during the Barack Obama presidency and serves the Biden campaign as a senior
advisor.

 

The attempts to infiltrate SKDK were recently flagged to the campaign firm
by Microsoft, which identified hackers tied to the Russian government as the
likely culprits, according to the three sources briefed on the matter.

 

The attacks included phishing, a hacking method which seeks to trick users
into disclosing passwords, as well as other efforts to infiltrate SKDK’s
network, the three sources said.

 

 

A Microsoft spokesman declined to comment.

 

SKDK is closely associated with the Democratic Party, having worked on six
presidential campaigns and numerous congressional races. In addition to its
current work for Biden, the firm in 2018 worked on successful governor’s
races in Kansas and Connecticut.

 

 

 

Wall Street sees a bright side in 'healthy' tech selloff

NEW YORK (Reuters) - Some of Wall Street’s biggest players are viewing the
stock market’s recent tech-led selloff as a bout of turbulence rather than
the start of a longer slide — and they don’t see it as a reason to run for
the door.

 

Invesco this week called the Nasdaq’s sharp decline a “healthy period of
consolidation” while fund manager Lord Abbett said U.S. stock valuations are
likely merited, based on an analysis of companies’ earnings.

 

On Sept. 4, Goldman Sachs reiterated its year-end price target of 3,600 on
the S&P 500, roughly 6% above the index’s close on Wednesday, while UBS
Global Wealth Management recommended clients “ease into the markets” rather
than stay on the sidelines.

 

Their optimism highlights how the Federal Reserve’s pledge to keep interest
rates at record lows and hopes of a breakthrough in a vaccine for COVID-19
have underpinned market gains this year, though many remain wary that the
U.S. presidential election and massive options bets on tech-related stocks
could exacerbate market swings in the remaining months of 2020.

 

“What we think we are going through is a healthy correction, removing the
froth,” said Troy Gayeski, co-chief investment officer of SkyBridge, an
alternative investments firm. “We certainly could fall more. But if you’re a
tech investor you had to understand that the valuations were very high.”

 

The Nasdaq posted its best day since April on Wednesday, a day after falling
into correction territory, commonly defined as a fall of 10% or more from a
recent peak. The other major indexes also rebounded on Wednesday after steep
declines.

 

“I think of this rout not so much as a correction, but as a digestion,”
Kristina Hooper, Invesco’s chief global market strategist, said in a recent
note.

 

Second-quarter reported earnings on the S&P 500 were 23.1% above
expectations, far above the trailing five-year average of 4.7%, analysts at
Lord Abbett said in a recent note.

 

“Earnings momentum, and the magnitude of analyst earnings revisions, is
outpacing that in other markets, suggesting that higher valuations on U.S.
equities are merited,” the report said.

 

Still, some believe more volatility is in store. A recent poll of investors
from UBS Global Wealth Management showed 65% viewed politics as their top
concern, with the Nov. 3 U.S. presidential election just weeks away.

 

Prominent investor Stanley Druckenmiller - a skeptic of this year's rally -
again sounded a bearish note on Wednesday, warning on CNBC here that the
stock market is in a mania fueled by the Federal Reserve.

 

Uncertainty over huge options purchases by SoftBank Group Corp (9984.T) also
hung over markets, creating another risk.

 

Gayeski, of Skybridge, said he could see an opportunity to increase equity
risk if there was a sharper drop, such as the Nasdaq falling 20% or the S&P
500 declining 15% from their respective highs and there were other
supportive signs for the market such as the Fed’s expanding its balance
sheet further.

 

Any selling that spreads beyond the big tech-related stocks that have led
markets higher could be an indication that the pullback may be extending
further, said Willie Delwiche, an investment strategist at Baird.

 

In the coming days, Delwiche is looking for signs of increasing investor
caution — such as buying of put options, outflows from equity funds and
diminishing bullish views in surveys — that indicate any over-exuberance has
waned.

 

Another indicator is how investors respond to key technical support levels,
said Keith Lerner, chief market strategist for Truist/SunTrust Advisory. The
Nasdaq, for example, on Tuesday closed below its 50-day moving average for
the first time since April, but was back above it on Wednesday.

 

“If you see these markets just slice through support levels, that’s a sign
that the sellers have the upper hand,” Lerner said.

 

 

 

Reform hopes rise as China focuses on inward economic shift

BEIJING (Reuters) - Chinese reform advocates are hoping President Xi
Jinping’s proposed new economic model, expected to be the centrepiece of a
key conclave next month, is an opportunity to quicken changes to spur
domestic demand and tackle structural woes.

 

The new development model will be discussed at a meeting of the ruling
Communist Party in October, where policies are expected to be built into the
next five-year road-map for the economy, policy insiders said.

 

Xi in May proposed a “dual circulation” strategy for the next phase of
economic development in which China will rely mainly on “domestic
circulation” - an internal cycle of production, distribution and
consumption.

 

That will be supported by “international circulation”, in which China
further integrates with the global economy, opening its doors to more
foreign goods, capital and investment.

 

As tensions between Washington and Beijing rise, the potential decoupling of
the world’s two largest economies presents significant risks, a prospect
that is firming China’s resolve to shift reliance to its own vast domestic
market, policy insiders said.

 

The gathering of the Central Committee, the largest of the Communist Party’s
elite decision-making bodies, will focus on the 2021-2025 plan for the
country’s social and economic development. It will be the 14th such plan
since China embarked on rapid industrialisation under its first five-year
plan in 1953-1957.

 

“It (dual circulation) will be a pivot of the 14th five-year plan. There
will definitely be difficulties to make it work,” said a policy insider.

 

Guided by the new strategy, elements of the 2016-2020 plan, including
supply-side reforms and policies to spur urbanisation and innovation, are
expected to be taken to the next level, the details of which will be
unveiled at the annual parliamentary session next year.

 

Few details have been published on the scheme itself, but economists and
think tanks are proposing various reforms that they deem crucial to steering
a more self-reliant economic course and building long-term growth drivers,
they said.

 

China’s State Council Information Office did not immediately respond to a
faxed request for comment.

 

Government advisers have called for faster reform of China’s land and
residency systems - key obstacles to its goal of building a highly
urbanised, consumer-driven economy - and tackling a yawning rich-poor gap
that has weighed on spending.

 

Overhauling giant state companies would help tackle deep-rooted economic
distortions and help level the playing field for struggling private firms,
they argued.

 

“Domestic circulation won’t take off if we cannot do a good job on reforms,”
said a government adviser who declined to be identified.

 

At a meeting with Chinese economists on Aug. 24, Xi pledged to take more
measures to break down “deep-seated institutional barriers”, and reaffirmed
a longstanding pledge to let markets play a decisive role in resource
allocation.

 

In April, China’s cabinet issued guidelines on improving market-based
allocation of “production factors”, including land, labour, technology and
capital, in a bid to deepen market-oriented reforms.

 

To be sure, rebalancing the economy to rely more on consumer spending and
less on inefficient investment and volatile exports has been a key policy
goal for the past decade.

 

But many Chinese advisers and economists are disappointed over the pace of
reform in recent years, as a stability-obsessed government has plucked lower
hanging fruit and delayed more painful reforms first unveiled at a key party
meeting in 2013.

 

Increased control by the ruling Communist Party over all aspects of society
has raised doubts about faster changes.

 

“If we want to rely on domestic circulation, we must push reforms to unleash
growth potentials,” said Jia Kang, head of China Academy of New Supply-side
Economics, a think tank.

 

‘MIDDLE-INCOME TRAP’

 

The stakes are high.

 

Three decades ago, China took advantage of its abundant cheap labor,
importing parts and components before re-exporting finished products. In
recent years, it has pivoted towards consumption-led growth.

 

Last year, total exports and imports accounted for 32% of gross domestic
product (GDP), down from a peak of 64% in 2006. Consumption as a share of
GDP climbed to 55.4% last year from 49.3% in 2010, but was still far lower
than 70-80% in developed economies.

 

While rebalancing has gained some traction, economists said further
transformation is needed to help China evade the so-called “middle-income
trap”, a situation where an economy stagnates at middle-income levels.

 

The main obstacles are growing competition from countries with advanced
technologies, as well as economies with lower labour costs.

 

China’s economy has to grow 5% annually in the next five years to help it
become a high-income nation, policy insiders said.

 

But growth this year, pummeled by the coronavirus crisis, is likely to slow
to its weakest pace since 1976 - the final year of Mao Zedong’s Cultural
Revolution. [ECILT/CN]

 

“The next five years will be a crucial period for bypassing the ‘middle
income trap’,” said Xu Hongcai, deputy director of economic policy
commission at China Association of Policy Science.

 

“As a big country, it’s not realistic to rely on external demand, and we
should strengthen stability of domestic supply chains and push
transformation to move up the value chain.”

 

 

 

 

Facebook, Google, Twitter urged by EU to do more against fake news

BRUSSELS (Reuters) - Two years after agreeing to a self-regulatory code of
practice to tackle disinformation, Facebook, Alphabet’s Google, Twitter and
other tech rivals must try harder to be more effective, the European
Commission said on Thursday.

 

Fake news related to COVID-19 has accelerated calls for social media to be
more proactive in combating the issue.

 

The companies, including Mozilla and trade bodies for the advertising
industry, signed up to the code in 2018 in a bid to stave off more
heavy-handed regulation. Microsoft and TikTok subsequently joined the group.

 

There are, however, several shortcomings in the code following an assessment
of its first year in operation, the commission said, according to a report
seen by Reuters.

 

“These can be grouped in four broad categories: inconsistent and incomplete
application of the code across platforms and member states, lack of uniform
definitions, existence of several gaps in the coverage of the code
commitments, and limitations intrinsic to the self-regulatory nature of the
code,” the report said.

 

The commission vice president for values and transparency, Vera Jourova,
called for more action to counter new risks.

 

“As we also witness new threats and actors the time is ripe to go further
and propose new measures. The platforms need to become more accountable and
transparent. They need to open up and provide better access to data, among
others,” Jourova said.

 

Jourova is currently working on a European Democracy Action Plan to make
democracy more resilient to digital threats.

 

The commission is also set to propose new rules called the Digital Services
Act by the end of the year which will increase social media’s
responsibilities and liability for content on their platforms.

 

 

 

 

European shares inch higher with eyes on ECB

(Reuters) - European shares edged higher on Thursday, with investors
awaiting signs of more stimulus from the European Central Bank in the face
of a strong euro, although it is expected to keep its policy unchanged.

 

The pan-European STOXX 600 index rose just 0.2%, as traders stayed away from
making big bets ahead of the policy statement.

 

Investors will be focused on commentary from ECB President Christine
Lagarde, who will address a surging euro amid an economic recovery losing
steam and anaemic inflation expectations.

 

The rate-sensitive European banks sector index .SX7P was down 0.2%, while
travel and leisure stocks .SXTP bounced 0.7% following steep declines in the
previous session.

 

Norway’s Equinor (EQNR.OL) rose 0.9% after it agreed to sell a 50% stake in
two U.S. offshore wind power development projects to energy major BP (BP.L)
for $1.1 billion. BP shares fell 1.0%.

 

 

 

 

Toyota's research arm says to form an $800 million investment fund

TOKYO (Reuters) - Toyota Motor Corp’s (7203.T) research arm said on Thursday
that it would create an $800 million global investment fund.

 

The fund called Woven Capital is to invest in companies in areas including
autonomous mobility and smart cities, Toyota Research Institute-Advanced
Development said in a statement.

 

Earlier this year, the Japanese automaker unveiled a plan to build a
prototype “city of the future” called Woven City at the base of Japan’s
Mount Fuji, powered by hydrogen fuel cells and functioning as a laboratory
for autonomous cars.

 

 

 

Caution reigns in wake of Nasdaq bounce, euro drifts higher ahead of ECB
meeting

SINGAPORE (Reuters) - Stock markets rose on Thursday, but without the spring
of Wall Street’s tech rebound as Asia’s investors trod carefully, while the
euro crept higher as currency traders stood by for a crucial European
Central Bank meeting later in the day.

 

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS
snapped its longest losing streak since February with a 0.7% gain. Japan's
Nikkei .N225 rose 0.9% and Chinese blue chips .CSI300 rose 0.8%.

 

Markets in Sydney and Hong Kong .HSI were just better than flat and, in a
sobering reminder of the risks, Jakarta .JKSE nosedived 5% on plans to
re-introduce COVID-19 social restrictions in the Indonesian capital.

 

“They’re half-hearted moves in Asia ... nothing that smacks of conviction
really,” said Mizuho Bank’s head of economics and strategy in Singapore,
Vishnu Varathan.

 

“There are some questions about what exactly triggered this turnaround (on
Wall Street). It wasn’t as if the sun came poking out and it’s all blue
skies.”

 

Futures traded either side of steady, with Euro STOXX 50 futures STXEc1 last
up 0.3% and FTSE futures FFIc1 down 0.2%, while futures for the S&P 500 ESc1
rose 0.1% and Nasdaq 100 NQc1 futures were up 0.4%.

 

Varathan said investors were grappling with whether this month’s U.S. tech
selloff was really done, and beyond that an increasingly uncertain U.S.
political outlook and persistent Sino-U.S. tensions.

 

Fuel demand fears also had oil prices back under pressure, in an indication
of wavering confidence in global growth. [O/R]

 

Brent crude futures LCOc1 fell a fraction to $40.77 a barrel after bouncing
back from a three-month low overnight. U.S. crude futures CLc1 slipped 0.2%
to $37.99 a barrel.

 

Bond buyers also returned after a tepid response to a $35 billion U.S.
10-year auction overnight, pushing the yield on U.S. 10-year debt down by a
whisker to 0.6968%. [US/]

 

EURO WAITS FOR ECB

Currency markets were mostly steady through the Asia session as investors
look to the ECB policy statement due at 1145 GMT and a subsequent news
conference from 1230 GMT.

 

Earlier concerns that the bank may turn dovish, or sound worried about the
euro’s rise, have started to give way to an expectation it might be more
upbeat about the economic outlook.

 

Bloomberg News reported on Wednesday that the ECB might leave its economic
projections broadly steady - not exactly bullish, but enough to leave the
euro EUR= drifting higher to $1.1821 in Asia.

 

“The risk now is that the euro could lift after the ECB meeting, if that is
the case and there is more confidence,” said Commonwealth Bank of Australia
currency analyst Kim Mundy, something that would pull other currencies
higher with it.

 

The pound GBP= was on a knife-edge ahead of emergency talks between Britain
and the European Union on Thursday after a British proposal to ignore parts
of the Brexit divorce pact threw trade negotiations into turmoil.

 

Sterling last sat at $1.3006 and 90.91 pence per euro EURGBP=.

 

U.S. jobless claims figures are also due at 1230 GMT and investors are also
intently focused on whether the U.S. stock market bounce can actually hold
firm.

 

Wednesday’s Nasdaq rebound has recouped about a quarter of the index’s
losses since it plunged from a record high on Sept. 2, but it has also
highlighted how stretched some stocks are.

 

“It’s too soon to say whether the rout is over, or whether last night’s
recovery is simply a pause,” ANZ analysts said in a note on Thursday.

 

Gold XAU= was steady at $1,947 an ounce.

 

 

 

 

 

 

 

 

 

 

 

 

 

 


 


 


Invest Wisely!

Bulls n Bears 

 

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INVESTORS DIARY 2020

 


Company

Event

Venue

Date & Time

 


 

 

 

 

 


 

 

 

 

 


 

 

 

 

 


Companies under Cautionary

 

 

 


 

 

 

 


Bindura Nickel Corporation

 

 

 


Padenga Holdings

 

 

 


Delta Corporation

 

 

 


Meikles Limited

 

 

 


 <mailto:info at bulls.co.zw> 

 


 

 


DISCLAIMER: This report has been prepared by Bulls ‘n Bears, a division of
Faith Capital (Pvt) Ltd for general information purposes only and does not
constitute an offer to sell or the solicitation of an offer to buy or
subscribe for any securities. The information contained in this report has
been compiled from sources believed to be reliable, but no representation or
warranty is made or guarantee given as to its accuracy or completeness. All
opinions expressed and recommendations made are subject to change without
notice. Securities or financial instruments mentioned herein may not be
suitable for all investors. Securities of emerging and mid-size growth
companies typically involve a higher degree of risk and more volatility than
the securities of more established companies. Neither Faith Capital nor any
other member of Bulls ‘n Bears nor any other person, accepts any liability
whatsoever for any loss howsoever arising from any use of this report or its
contents or otherwise arising in connection therewith. Recipients of this
report shall be solely responsible for making their own independent
investigation into the business, financial condition and future prospects of
any companies referred to in this report. Other  Indices quoted herein are
for guideline purposes only and sourced from third parties.

 


 

 


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