Country Garden Holdings, a Chinese property firm, has announced plans to issue HK$270 million worth of new shares to repay its loans. The shares will be issued at a 15.38% discount to the closing price on Tuesday. Investment holding firm Ever Credit, owned by laminates manufacturer Kingboard Holdings, will be the subscriber of these shares, giving Kingboard a 1.25% stake in Country Garden. The company’s aim is to preserve cash resources, reduce gearing, and strengthen its financial position.
Shares of Chinese electric vehicle maker Nio have plunged 8.30% following the announcement of a net loss of 6.06 billion yuan ($831.65 million) in the second quarter, wider than the previous year’s net loss. Nio sold 23,520 vehicles in the quarter but expects an increase in deliveries in the third quarter. However, price cuts may impact profitability in the coming quarters.
Australia’s consumer price index grew 4.9% year-on-year in July, lower than the 5.4% in June. Excluding volatile items, the inflation rate was 5.8%, down from the revised June figure. Increases in housing prices and food and non-alcoholic beverages were the main contributors to the annual increase.
Chinese state-owned banks are expected to lower interest rates on existing mortgages, marking the first time since the global financial crisis, according to Reuters. The size of the cuts will vary depending on clients and location but could be as much as 20 basis points in some cases.
Morgan Stanley Investment Management’s Andrew Slimmon predicts a “strong rally” in markets by the end of the year, with the S&P 500 reaching 5,000. He named three stocks to buy.
Costco in China is experiencing higher foot traffic compared to its U.S. stores, indicating that the premium market in China is performing well. However, companies are cautious about marketing spend due to uncertainty about future growth.
UBS warns investors about a potential “pain trade” as Chinese stocks rise, which could lead to a “bear trap” where traders close out short positions when markets rise.
The U.S. dollar has reached its highest level against the Japanese yen this year, up 0.5% at 147.24. The Nikkei is down -2.85% in August, heading towards its worst month since December 2022.
All three major indices, S&P 500, Nasdaq Composite, and Dow Jones Industrial Average, are trading above their respective 50-day moving averages on Tuesday.
U.S. Treasury yields have declined as investors anticipate key economic data releases that will provide insights into inflation and labor market developments, potentially influencing the Federal Reserve’s monetary policy decisions.
Apple has sent out invites for its September press event, where it is expected to announce the iPhone 15 and new Apple Watches. The new iPhone models may feature a USB-C charging port and could be made out of titanium. Apple’s stock has risen nearly 2% following the announcement.