WORLDWIDE : HEADLINES
Exclusive-Alibaba plans to raise at least $5 billion via dollar bond this month -sources
HONG KONG – Chinese e-commerce leader Alibaba Group Holding Ltd plans to raise at least $5 billion through the sale of a U.S. dollar-denominated bond this month, four people with direct knowledge of the matter said.
Depending on investor response, proceeds could reach $8 billion which Alibaba is likely to use for general corporate expenditure, one of the people said.
The plan, including the timeline, is not final and subject to change, the people said, declining to be identified as they were not authorised to speak to the media.
Alibaba declined to comment.
The debt raising plan comes months after an October speech from billionaire co-founder Jack Ma about regulation stifling innovation that led to the suspension of affiliate Ant Group’s blockbuster $37 billion initial public offering.
Since then, Chinese regulators have launched an antitrust probe into Alibaba and ordered Ant to shake up its lending and other consumer finance businesses including the creation of a separate holding company to meet capital requirements.
Full coverage: REUTERS
NYSE’s U-turn on China telco delistings may reverse again, amid tension and confusion over policy
NEW YORK/WASHINGTON/HONG KONG/ -The New York Stock Exchange is reconsidering its plan to allow three Chinese telecom giants to remain listed, the latest twist amid confusion over rules set by the Trump administration and tension within Washington on China policy.
If it does so, it would mark a second sudden U-turn. The bourse said late Monday it reversed an decision announced just last week to delist China Mobile Ltd, China Telecom Corp Ltd and China Unicom Hong Kong Ltd after consulting with regulatory authorities in connection with the U.S. Treasury’s Office of Foreign Assets Control.
The about-face was due to ambiguity over an executive order issued by President Donald Trump barring investment in firms Washington says are tied to the Chinese military, and whether the three firms were banned under the order, a source familiar with the matter said on Tuesday.
However, it will now go ahead with the delistings, which were planned on or before Jan. 11, if it deems the companies are subject to the order, said the person who asked to remain anonymous because the discussions are ongoing.
Bloomberg earlier reported that the NYSE may flip back.
Full coverage: REUTERS
WORLDWIDE : FINANCE /MARKETS
Stocks fall, bond yields rise as investors brace for possible Democrat triumph in Georgia
TOKYO/NEW YORK – Global stock prices slipped and U.S. bond yields rose on Wednesday as investors braced for the prospect that Democrats could win both races in a U.S. Senate run-off election in Georgia, handing them control of the crucial chamber.
Along with their narrow majority in the House of Representatives, a ‘blue sweep’ of Congress could usher in larger fiscal stimulus and pave the way for President-elect Joe Biden to push through greater corporate regulation and higher taxes.
Democrat candidates took early leads in the twin Georgia Senate races, though the outcome may remain in doubt for days if the margins are razor-thin.
“Having control over both the legislative and executive branches could theoretically lead to sweeping changes to policy,” said Vasu Menon, investment strategy executive director at OCBC Bank.
“With Biden proposing to reverse President Donald Trump’s tax cut, increase the minimum wage, and strengthen oversight on various industries, some might argue that his agenda is not particularly market-friendly.”
Futures for the S&P 500 fell 0.43%, while Nasdaq futures shed 0.7% on fears Democrats could pursue tighter regulations on big tech firms.
Other industries, such as banks, oil and gas and healthcare, could come under heavier scrutiny, while infrastructure and alternative energy sectors could benefit.
Japan’s Nikkei fell 0.4% while MSCI’s index of Asian-Pacific excluding Japan erased earlier gains to stand almost flat.
Full coverage: REUTERS
Brent oil rises to highest since February after Saudi Arabia output cut
TOKYO – Brent oil prices rose on Wednesday to the highest since February after Saudi Arabia agreed to make bigger cuts in output than expected during a meeting with allied producers, while industry data showed U.S. crude stockpiles fell last week.
Brent crude rose as much as 0.6% to $53.94 a barrel, the highest since Feb. 26, 2020. It was at $53.79 a barrel at 0147 GMT and gained 4.9% on Tuesday.
U.S. West Texas Intermediate (WTI) futures gained 13 cents, or 0.26%, to $50.06 a barrel. The contract on Tuesday closed up 4.6% at $49.93, its highest since Feb. 24, 2020.
Saudi Arabia, the world’s biggest oil exporter, agreed on Tuesday to make additional, voluntary oil output cuts of 1 million barrels per day (bpd) in February and March, after a meeting with the Organization of the Petroleum Exporting Countries (OPEC) and other major producers that form the group known as OPEC+.
The reductions agreed by Saudi Arabia were included in a deal to persuade other producers in the OPEC+ group to hold output steady.
With coronavirus infections spreading rapidly in many parts of the world producers are trying to support prices as demand takes a hit from new lockdowns being put in place.
“The decision came as a huge surprise as the organisation struggled yesterday to agree to a deal,” Capital Economics said in a note.
Full coverage: REUTERS
Dollar squeezed as traders wait on Georgia results
SINGAPORE/HONG KONG – The U.S. dollar steadied in Asia on Wednesday as traders looked to the outcome of a Senate election in Georgia to drive the next move in market sentiment.
The dollar had dropped through a major support level against the Japanese yen on Tuesday and it briefly fell to a fresh 10-month low of 102.60 yen on Wednesday before steadying.
The euro also rose past major resistance at $1.2310 to as high as $1.2328 in early Asia trade, its strongest since April 2018, before slipping back to $1.2281 as traders watched close early results from Georgia flow in.
The Australian and New Zealand dollars hung on to hefty gains to trade near multi-year highs, with the Aussie a touch softer at $0.7745 and the kiwi touching a new 32-month top before easing back to $0.7240.
Sterling was slightly softer at $1.3607.
The outcome of the runoff vote to elect two senators in Georgia will determine control of the U.S. Senate, although a final result is not expected before Wednesday morning in the United States – perhaps longer if it is close.
If they win both spots, Democrats will take control of the Senate and would be able to pass their legislative agenda, which could include higher taxes and more stimulus.
“The market reaction to the outcome will probably be dictated by what it is assumed to mean for fiscal policy, rightly or wrongly,” said RBC Capital Markets currency strategist Adam Cole.
Full coverage: REUTERS
