Aurelia Butler

In a statement issued on Tuesday, U.S.-listed Sea said Tencent and its affiliates, which together hold a 21.3% stake in the company, had given an irrevocable notice to convert all their Class B ordinary shares.Upon conversion, all outstanding class B shares of Sea will be beneficially owned by Forrest Li, the founder, chairman and CEO of Sea, whose market value of $124 billion makes it Southeast Asia’s most valued company.Tencent has also agreed to terminate its proxy to Li after the conversion.Sea is proposing to increase the voting power of each Class B ordinary share to 15 votes from three.”The board believes that, as Sea has scaled significantly to become a leading global consumer internet company, it is in the best interests of the company in pursuing its long-term growth strategies to further clarify its capital structure through the contemplated changes,” it said.Sea did not mention the size of the voting stake previously held by Tencent.Sea said the changes are subject to approval by its shareholders at its annual general meeting set for Feb. 14.It said that once the changes are made, the outstanding Class B ordinary shares beneficially owned by Li are expected to represent about 57% of the voting power, up from about 52%.Separately, Li holds about 54% of the total voting power related to the size and composition of Sea’s board of directors. More

Investing.com — The U.S. posts 1 million Covid-19 cases in a day – and the actual number is probably higher than that. However, markets are still advancing on the assumption that the faster spread of a less virulent strain means the beginning of the end of the pandemic. The Institute of Supply Management publishes its December manufacturing survey, and the Labor Department publishes its JOLTS report for November. China’s manufacturing PMI hits its highest since June, and OPEC meets with its allies to decide on output quotas for February. Here’s what you need to know in financial markets on Tuesday, 4th January.1. Omicron surgeThe U.S. notched more than 1 million new cases of Covid-19 on Monday, beating the previous record for any country worldwide by a distance. The figures are skewed by the holidays, which have delayed reporting in some cases, but which – as usual – sharply increased the potential for transmission.Omicron, the new dominant strain of the disease, appears to cause less severe illness than previous strains: hospitalizations are still around 30% below last year’s peak, and in South Africa, where the new variant first emerged, the wave of infections has peaked without overstraining the country’s health service. Still, the short-term surge in cases is leading to increased absenteeism, especially in service sectors such as airlines and healthcare. Over 4,000 flights were cancelled over the weekend, more than half of them in the U.S.Overseas, the Indian capital of Delhi reimposed a weekend curfew to stem the rise in cases.2. Carriers agree to two-week delay of 5G launchVerizon (NYSE:VZ) and AT&T (NYSE:T) agreed to delay the launch of 5G services for two weeks after more pressure from aviation regulators and airlines, but said that their services would still go live this month.The carriers are in a hurry to start monetizing the investments they’ve made in spectrum and network infrastructure, while the Federal Aviation Authority and airlines are concerned about the risk to cockpit safety systems in an around airports.Airlines 4 America, the industry lobby group, had threatened to cancel thousands more flights unless their concerns were addressed. Airline stocks were broadly higher on perceptions that Omicron will bring an accelerated end to the pandemic without further economic disruptions, while the two carriers’ stocks edged up.3. Stocks set to open higher on pandemic hopesU.S. stocks are set to open at fresh record highs later, on confidence that Omicron will push the U.S. toward herd immunity faster, allowing the economic rebound to continue unimpeded.Sentiment was also boosted by some eye-catching headlines including Tesla’s record deliveries in the fourth quarter and Apple’s brief flirtation with a market value of $3 trillion.By 6:20 AM ET (1120 GMT), Dow Jones futures were up 132 points, or 0.4%, while the S&P 500 and Nasdaq 100 futures contracts were both up in line.In the bond market, 10-Year U.S. Treasury yields were consolidating at 1.62%, after rising 13 basis points in the first days of 2022, amid fears that inflation is likely to stay uncomfortably high for the next few months.4. ISM PMI expected to cool a little; China’s hits 6-month highThe Institute for Supply Management will release its monthly manufacturing survey at 10 AM ET, and is expected to show a slight cooling off in December, both in terms of overall activity and – importantly – in input and output prices.The Labor Department will also publish its monthly Job Openings and Labor Turnover Survey for November, which will show whether October’s dip in the so-called ‘quit rate’ was just a blip or the start of something more like a trend.Economic data from around the world overnight were broadly encouraging, with China’s Caixin manufacturing PMI beating expectations to hit its highest level since June. In the Eurozone, French inflation data supported the European Central Bank’s view that inflation is close to peaking, while German unemployment fell more than expected in December. German retail sales for November were weak, but not as weak as thought.5. OPEC+ set to continue increasing output quotas The Organization of Petroleum Exporting Countries and its allies are expected to go ahead with another 400,000 barrel-a-day increase in output quotas from February when they meet later in Vienna.Whether OPEC countries – in particular those in Africa and Latin America – will actually be able to meet those production quotas is another question. The bloc has missed its production targets for the last three months, due largely to past underinvestment catching up with state oil companies. That is not a constraint for either Russia or Saudi Arabia, the bloc’s two biggest exporters.Elsewhere, China cut export quotas for its refiners substantially in a move that suggests the authorities are keen to keep a lid on domestic prices.U.S. crude futures rose 0.3% to $76.31 a barrel, while Brent futures rose 0.3% to $79.19 a barrel. More

“As has always been the case, you can receive a refund at any time, the company said in an email to one of its customers. Reuters has seen a copy of the email. Starlink, a division of Musk’s SpaceX aerospace company, has already received over 5,000 pre-orders for its devices in India but is struggling to receive commercial licences without which it cannot offer any services in the country. “Unfortunately, the timeline for receiving licences to operate is currently unknown, and there are several issues that must be resolved with the licensing framework to allow us to operate Starlink in India,” the company said in the email. “The Starlink team is looking forward to making Starlink available in India as soon as possible,” it said. Starlink is one of a growing number of companies launching small satellites as part of a low-Earth orbit network to provide low-latency broadband internet services around the world, with a particular focus on remote areas that terrestrial internet infrastructure struggles to reach. But the Indian government has advised people against subscribing to Starlink without a licence and also warned the company, ordering it to refrain from taking bookings and rendering services. Starlink is planning to apply for a commercial licence in India by the end of January, its country head had said in a social media post last month, and a presentation showed with an April roll out it targeted 200,000 devices in India by December 2022. Its competitors include Amazon.com (NASDAQ:AMZN)’s Kuiper and OneWeb – a collapsed satellite operator rescued by the British government and India’s Bharti Group. More

LONDON/TOKYO (Reuters) – Global manufacturing activity remained strong in December as factories took rising cases of the new Omicron coronavirus variant in their stride, although persistent supply constraints and rising costs clouded the outlook for some economies.Rising global infections have inspired policymakers to tread carefully, with outbreaks in China forcing some firms to suspend production and threatening to disrupt output for memory chip giants, such as Samsung Electronics (OTC:SSNLF).Yet for now, the hit from Omicron to output appears to be modest, according to surveys released on Monday and Tuesday.Manufacturing activity in the euro zone remained resilient at the end of 2021 as factories took advantage of some easing in supply chain bottlenecks and stocked up on raw materials at a record pace, a survey showed on Monday.In Britain , manufacturing activity grew slightly faster than originally thought last month, another survey showed on Tuesday.”Supply chain disruptions, however, likely will worsen this month, given that Brexit customs checks have been bolstered and Omicron likely will lead to renewed factory closures in Asia,” said Samuel Tombs, chief UK economist at Pantheon Macroeconomics.In China , factory activity expanded at its fastest pace in six months in December, the Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) showed.The findings from the private survey, which focuses more on small firms in coastal regions, tally with those in China’s official PMI that pointed to an uptick in factory activity.Other parts of Asia also fared well with manufacturing activity expanding in countries ranging from Vietnam to Malaysia and the Philippines.”Manufacturing PMIs and timely trade data reveal that Asia’s export-focussed industry gained momentum at the turn of the year,” said Alex Holmes, emerging Asia economist at Capital Economics.”While the Omicron variant presents a key threat to the outlook, it is unlikely to cause nearly as much disruption to industry as Delta did in Q3,” he said.In Japan, the world’s third-biggest economy, manufacturing activity in December grew for an 11th straight month while bellwether exporter South Korea saw the fastest pace of expansion in three months, surveys showed.”We expect Asia’s exports and capex upswing to be sustained by continued global recovery, and Asia’s manufacturing PMIs will remain moderately strong over the coming months,” Morgan Stanley (NYSE:MS) analysts wrote in a research note.Japan’s PMI stood at 54.3 in December, remaining above the 50-mark threshold that indicates expansion in activity but lower than November’s 54.5 as new order growth softened.South Korea’s PMI rose to 51.9 from 50.9 in November to mark the 15th consecutive month of expansion, as rising domestic demand offset sluggish overseas sales.India’s manufacturing activity continued to expand in December though at a slower pace than in November, as elevated price pressures remained a concern.”The Omicron variant poses near-term growth risks by delaying the consumption recovery, but higher vaccination rates in Asia could help limit the damage to growth as compared to the Delta wave,” Morgan Stanley analysts said. More

Investing.com — It’s been a grueling 2021. Bereavement, illness, and economic hardship due to lockdowns have been the experience of all too many. However, the economic data show a vigorous rebound from the first year of the pandemic, with trade and employment growing rapidly. Those economic trends are set to continue in 2022, albeit at a more moderate rate. However, progress has been bought at the cost of what is arguably the biggest inflation threat since the 1970s and steering against that threat while avoiding a crash in markets that are still trading at historically high multiples will take some doing. Here are some of the big trends to watch as we enter 2022.1. The Global Monetary Tightening CycleThe next year will be dominated by rising interest rates. In truth, rising interest rates already arrived in style in 2021 in many parts of the world, but the Federal Reserve, guardian of the world’s reserve currency, has now made the process truly global. The first rates to rise will be longer-term ones, as the Fed winds down within the short space of three months a quantitative easing program that is still running at $120 billion a month. It’s expected to raise the target range for Fed funds by as much as 75 basis points between March and the end of the year.Whether it tightens by more or less will depend on the path of inflation in that period. Base effects and – more importantly – a likely slowdown in the economy as the excess savings of 2020 are finally spent, suggest that inflation should weaken in the course of the year: the Fed itself sees core personal consumer expenditures rising only 2.6% next year, after a 5.3% increase this year. The other major factor will be how much pressure the Fed comes under from Congress as the mid-term elections near in November.Either way, as long as the Fed remains in tightening mode, the pressure on other central banks – with the exceptions of Switzerland, Japan, and possibly China – to keep tightening will remain.2. Covid: Year 3 And Counting…The course of the pandemic will arguably be the greatest single influence on the thinking of the Fed and many other central banks. As of the time of writing, the Omicron variant is on a tear through Europe and is now present in 43 of the U.S.’s 50 states.Not enough is known about Omicron to make any forecast with confidence. Initial studies suggest that it is less likely to lead to serious illness than the hitherto-dominant Delta strain, but that it also evades the immune defenses generated by a two-shot vaccination, allowing it to spread faster. Lower virulence will not be enough to avoid fresh lockdowns if the number of infections continues to double every three days, as it is doing in parts of the world at present.Encouragingly, it seems clear that booster shots of the Moderna (NASDAQ:MRNA) and Pfizer/BioNTech vaccines will buy time for new drugs specially tailored to Omicron to be developed. Equally, the supply of vaccines and, increasingly, antiviral drugs continue to expand, especially through the WHO’s Covax program.That should reduce the disparity in access to vaccines that has given the virus freedom to thrive and mutate at will in the world’s poorer countries. The current COVAX forecast projects it will have made 2.39 billion doses available by March, as well as options for a total of over 6.5 billion doses by 2023.3. China’s Trifecta: Omicron, Evergrande and TaiwanOmicron may seem less dangerous to human life than all dominant Covid-19 strains before it, but it still poses a serious threat to financial markets because of the reaction function of the world’s two largest economies.In the U.S., vaccine hesitancy means that the risk of rapid transmission is especially high. That could lead to waves of high absenteeism, making existing labor shortages worse. However, the real supply-side risk is in China, because of its tendency to lock down hard and wide in response to any sign of Covid. Given the reported low efficacy of the two main Chinese vaccines against Omicron, the risk is of renewed closures of important Chinese manufacturing and logistics hubs through the year, which would prolong the problems of other manufacturers and retailers further west.That is not the only challenge facing China next year. At some stage, the country’s authorities will have to decide who gets to bear the losses on debts owed by China Evergrande Group and other over-extended real estate developers. It will have to do so without triggering panic among domestic retail investors, and, preferably, without resorting to yet more borrowing to spend its way out of a growth slowdown. Any sign of financial or even social instability may embolden Beijing to distract attention with a little foreign policy adventure: after ending Hong Kong’s autonomy, President Xi Jinping, with what amounts to a fresh mandate from the Communist Party to rule for life, has made no secret of his desire to restore mainland sovereignty over Taiwan.4. Europe’s Energy CrisisGeopolitical risk is also one element – but only one element – of another story set to dominate headlines in Europe, especially early on in 2022. The old year is ending with Russian President Vladimir Putin threatening an outright invasion of Ukraine, on the spurious basis that NATO’s eastward expansion is an existential threat to it.Most analysts have inclined to the view that the military maneuvers on Russia’s border with Ukraine, where over 100,000 troops are currently massed, are ultimately a pressure tactic to ensure the opening of the controversial Nord Stream 2 pipeline, which promises to be a lucrative earner for Gazprom (MCX:GAZP) and its state owners. However, with Putin expressly talking of “military-technical” action in a speech to his defense chiefs on the Tuesday before Christmas, that can no longer be taken as a given.As in 2008, when oil prices were still above $100 a barrel, Europe’s ability to respond to an invasion would be inhibited by the fact that power and gas prices are already far above previous record highs, due to a shortage of gas in storage, increasing constraints on coal power due to environmental policy, and the declining availability of an aging nuclear fleet that has already been thinned out by environmental zealotry in Germany and elsewhere.The consequences of wishing an Energy Transition into existence without securing supplies have become painfully obvious.The looming explosion of household energy bills is already set to add 1% to U.K. inflation in April, when a regulatory price cap is lifted, and is forcing Italy and Spain to extend subsidies previously built into energy bills as an emergency measure. Gas-intensive industries such as fertilizer makers have already been forced to close factories, and the risk is that more will have to as utilities ration supplies through the end of the winter.5. Can OPEC and the U.S. Keep Pace with Oil Demand?The spread of Omicron has also suspended all bets on when, precisely, global oil demand will top its pre-pandemic peak, but it seems sure to do so sooner rather than later, asking questions of both OPEC and U.S. policy.According to data from the American Petroleum Institute, U.S. demand alone was within 0.4% of its peak by November, before the latest wave of infections put a dampener first on air travel and, most likely, road travel too. When demand does finally recover, it’s not clear that supply will be able to keep pace: economic uncertainty and increasing environmental activism by shareholders and governments have led to falling investment in new production. Barring some miracle in the dying days of the year, discoveries will have fallen to their lowest since 1946 in 2021, according to analysis by Rystad Energy.“Those who believe most recent price inflation is temporary may misunderstand the time required for oil and gas investments,” Dean Foreman, the API’s chief economist, warned in a recent note. Both OPEC and U.S. producers found themselves more concerned with repairing balance sheets than with increasing supply this year. It will likely take a change of heart in both corners to avoid another surge in oil prices in 2022.6. Crypto’s Watershed YearThe global monetary tightening cycle will provide a stiff test for cryptocurrencies, which have shown an increasingly high correlation to speculative assets in the past year. Speculative assets tend to perform badly when interest rates rise, after all.However, for those who remain committed to crypto, 2022 promises to be an exciting year, in which the U.S., Europe and India are all expected to clarify the regulatory direction of travel, something that should put the asset class on firmer legal ground.On a technical level, the event of the year may be the completion of Ethereum’s transition to the Proof-of-Stake mechanism on its blockchain, moving away from the more energy-intensive Proof-of-Work mechanism that constrains scalability (as well as generating heaps of bad press for crypto on environmental grounds). Given Ethereum’s place in the universe of decentralized finance (DeFi) initiatives now multiplying, the importance of the transition can hardly be overstated.Elsewhere, the progress of Polygon, which provides an infrastructure for different blockchains to communicate with one another, may also expand the ease of use of many coins – although it will make it harder for enthusiasts to argue that the more than 6,000 digital coins now in existence derive their value from their scarcity. More

In December alone, consumer prices jumped 13.58%, official data showed on Monday, further eroding the earnings and savings of Turks hit by a currency crisis and resulting economic upheaval.Despite the price pressure, the central bank slashed its key rate by 500 basis points to 14% since September, sending the lira down as much as 50% in that period alone. As a result, import prices soared and set off what some economists called a “vicious cycle” in which the government responded by lifting minimum wage, taxes, utility tariffs and other prices. Here are some of the price hikes that have been implemented:WAGES AND PENSIONSThe government hiked the monthly minimum wage by 50% to 4,250 lira ($275.44) for 2022 and raised some related taxes on employers. President Tayyip Erdogan said civil servant salaries had been raised by 30.5% from January, and monthly pension payments would jump to 2,500 lira ($189) from 1,500.POWER The Energy Market Regulatory Authority, citing high global energy inflation, said electricity prices were raised by as much as 125% for high-demand commercial users and by around 50% for lower-demand households for 2022.GASNatural gas prices jumped 25% for residential use and 50% for industrial use in January, national distributor BOTAS said. The monthly price rise was 15% for power generators.PETROLPetrol prices, frequently adjusted in line with international prices, rose by more than half a lira per litre, or around 5%, in the latest adjustment, while diesel prices increased by 1.29 liras, the Energy, Petroleum, Gas Stations Employers Union (EPGIS) said. ROAD, BRIDGE TOLLSThe tolls for use of highways and bridges were raised by an average 25%.RAILWAYSTicket prices for the Marmaray rail service through a tunnel underneath the Bosphorus Strait in Istanbul rose by 36%. Turkish Railways raised ticket prices for its high-speed trains by some 20%.CIGARETTES AND ALCOHOLThe special consumption tax on cigarettes and alcohol was raised by 47%, making cigarettes about 20% more expensive and lifting alcohol prices by around 20-33%.GRAINSTurkey’s TMO state grain board announced price hikes of some 23-24% for wheat and barley to support farmers. TAXI, BUS FARESFares for taxis in Istanbul went up by around one third from the start of the year. Bus fares in Istanbul rose by around 36%.CAR INSURANCEThere was a 20% jump in mandatory vehicle insurance costs for those with the highest deductible, which will come into effect as of February.($1 = 13.2386 liras) More

HONG KONG (Reuters) – China Evergrande Group’s shares soared briefly in resumed trade on Tuesday after the developer said a government order to demolish 39 buildings on the resort island of Hainan would not affect the rest of its massive project there. The firm, struggling to repay more than $300 billion in liabilities, also said its contracted sales for 2021 had plunged 39% from the previous year to 443 billion yuan ($69.5 billion).Its shares surged as much as 10% in Hong Kong before trimming gains to close 1.3% higher at HK$1.61, compared to a 3.5% rise in the broader Chinese property sector. Evergrande’s shares were suspended from trading on Monday until Tuesday afternoon, pending the release of a statement from the company, which has become the poster child for troubles in China’s giant property market. Evergrande confirmed late on Monday that on Dec. 30 authorities in Danzhou city, Hainan province, had ordered it to demolish 39 buildings at Ocean Flower Island, a massive integrated resort development where Evergrande has spent 81 billion yuan ($13 billion) to build over 60,000 homes.It did not disclose the reason for the demolition order and Reuters could not reach Hainan provincial authorities for comment.Local media, citing a screenshot of the official order, reported prior to Evergrande’s confirmation on the demolition that the buildings needed to be demolished within 10 days for illegal construction and environmental violations.The order did not involve other plots of land in the project, Evergrande said on Tuesday.”The company will actively communicate with the authority in accordance with the guidance of the decision letter and resolve the issue properly,” it added in the filing.On its liquidity status in general, the firm said it would continue to actively maintain communication with creditors. With Evergrande finding it tough to pay its suppliers and contractors due to the liquidity squeeze, some of its projects were halted. But the company said last week 91.7% of its projects nationwide had resumed construction, and over 100 developments totalling 39,000 units would complete building in December.J.P. Morgan said in a report early this week that most developers had missed their 2021 sales targets, although sales still managed average growth of 3% on-year. The investment bank expected yearly sales growth to continue to shrink in the first quarter due to a very high base and weak market sentiment. ($1 = 6.3717 Chinese yuan renminbi) More

Chinese coal futures rose on Tuesday ahead of a review of an export ban announced last week by Indonesia, one of the world’s largest exporters of the fossil fuel, stoking fears of knock-on effects for the global economy.The most active contract traded on the Zhengzhou Commodity Exchange rose as much as 8 per cent on Tuesday compared with its Friday closing price, with several other contracts also up more than 6 per cent at midday.Indonesia’s state utility provider said on Monday that the country’s coal supply situation was facing a “critical period”. This followed an energy ministry announcement at the weekend that the government would seek to ban coal exports for the month of January.The energy ministry said the ban would help to avoid outages at power plants run by the state utility PLN. The ban has fuelled fears of further increases in commodity prices after pandemic-led supply shortages around the world. As well as being China’s largest foreign source of coal, Indonesia is also an important supplier to India and south-east Asia. The country provided a record of more than 21m tonnes of coal to China in September, up from 17m in August. “The move could potentially have knock-on effects in China and India, which are the usual destinations for Indonesian coal,” said Warren Patterson, head of commodities strategy at ING.Coal prices in China have been particularly volatile during the pandemic, with futures surging to as much as Rmb2,301 ($362) in October as the country’s economic recovery increased demand while lockdowns to combat the Delta coronavirus variant crimped supply. That compared with about Rmb700 for most contracts traded in Zhengzhou on Tuesday. Coal prices in China later dropped after Beijing introduced measures including instructing domestic miners to increase production.In a statement on Monday, PLN said it had received commitments for an additional 3.2m tonnes of coal for its plants in January with help from the government. But it said it needed a total of 5.1m additional tonnes to avoid widespread outages in the country. It warned that ensuring supply was in the “national interest” and should be “prioritised” ahead of a review of the ban by ministers on Wednesday.President Joko Widodo said supplying PLN was “a must” and called on coal producers to fulfil domestic needs before exporting.Analysts at Morgan Stanley said the potential loss of Indonesian coal exports, which account for about 40 per cent of the so-called seaborne market, could trigger a similar coal price rise to that of October. At that time, the price of high-energy Australian coal, the benchmark for the Asian market, rose to a record of more than $270 a tonne. It is at present trading at about $150 a tonne.“That said, the export ban could still be reassessed/fine-tuned, with a meeting between the government and miners scheduled for 5 January,” said the Morgan Stanley analysts.Shares in Whitehaven Coal, one of Australia’s largest independent coal suppliers, rose 5.8 per cent to A$2.76 on Tuesday on news of Indonesia’s ban. London-listed Glencore, which also operates coal mines in Australia, gained as much as 3.3 per cent in morning trading. More