4 hours ago
China’s largest chipmaker SMIC reports an 80% drop in third-quarter profits, stocks slide
China’s largest chipmaker SMIC reported an 80% drop in third-quarter profit on Thursday as weak global demand hit foundries hard.
Hong Kong-listed shares of SMIC fell 5.98% by midday trading.
Net profit for the quarter slumped 80% year-on-year – more than the 64% decline in the second quarter of 2019, according to company figures.
SMIC, or Semiconductor Manufacturing International Co., posted revenue of $1.62 billion in the third quarter of the year, down 15% year-on-year. Net income was $93.98 million in the period, well below analysts’ expectations of $165.1 million.
Read the whole story here.
— Sheila Chiang, Shreyashi Sanyal
5 hours ago
Wynn Macau shares fall in Hong Kong trading
Hong Kong-listed shares of casino operator Wynn Macau fell 9.33% to their lowest level in almost a year.
The company reported a narrower quarterly net loss of $6.2 million compared to last year’s quarterly loss of $242.0 million.
The results come as Wynn Macau’s controlling shareholder, Wynn Resorts, faces a strike in Las Vegas unless an agreement is reached with workers before the union’s 5 a.m. PT deadline on Friday. The Associated Press reported that the casino operator will have to lay off 5,000 workers if the deadline is not met.
Hospitality workers have already struck deals with rival casino giants Caesars and MGM Resorts.
Wynn Resorts also reported third-quarter earnings overnight. During the earnings call, Chief Financial Officer Julie Cameron-Doe cited $10 million in one-time charges, including “provisions for anticipated increases related to a new union contract.”
Shares of other casinos operating in both Macau and Las Vegas were also lower in Hong Kong trading. MGM China fell 1.73% and Sands China lost 3.29%, while the broader Hang Seng index fell 1.62%.
—Shreyashi Sanyal
7 hours ago
SoftBank shares plunge as WeWork collapses with quarterly loss of $6.2 billion
Shares of Japan’s SoftBank Group fell 7.39% in early trading, hitting their lowest level since early June.
SoftBank posted another loss of 931.1 billion yen ($6.2 billion) in the second quarter, while the LSEG estimate called for a loss of 114.1 billion yen.
Quarterly net sales were 1.67 trillion Japanese yen, versus expectations of 1.6 trillion yen.
SoftBank’s losses were due to the investments and financial support the company provided to co-working space company WeWork, which filed for Chapter 11 bankruptcy protection in the United States this week.
The company said its Vision Fund posted an investment gain of 21.3 billion yen, its second straight quarter of profits. The decisive factor here was a profit from the sale of shares in the chip manufacturer Arm to a subsidiary of SoftBank.
The Japanese blue chip Nikkei 225 fell 1.09% in the first hour of trading.
7 hours ago
New Zealand manufacturing activity contracted in October by the most in over two years
New Zealand’s manufacturing sector contracted for the eighth consecutive month in October, according to a survey.
The Bank of New Zealand-BusinessNZ Performance of Manufacturing Index (PMI) fell to 42.5 in October from 45.1 in September. The value was well below the long-term average activity rate of 52.8.
It was also the sharpest decline since August 2021.
A reading above 50 indicates an expansion in manufacturing activity, while anything below indicates a decline.
BNZ senior economist Doug Steel said: “Today’s PMI is not a good outlook for GDP and employment growth.”
“There is a possibility that the decline could be larger than we think if the PMI does not recover in the final months of the year.”
The number of new orders fell from 44.8 in the previous month to 44.1.
—Shreyashi Sanyal
8 hours ago
CNBC Pro: Eli Lilly and more: Strategist names 5 stocks that promise ‘significant’ earnings growth
Rising interest rates and the possibility of an impending recession have created a “mixed picture” for stock markets, according to a strategist – but several companies can look forward to significantly stronger earnings growth next year.
“If you look at what companies are saying about next year, they’re not really being overly cautious or overly optimistic… So you get the sense that earnings are going to be robust into next year, meaning they’re going to be stable year-over-year. “ [growth]” Rahul Ghosh, portfolio specialist in the equity division at T. Rowe Price, told Street Signs Asia on Thursday.
“But if you’re looking for significant earnings growth, I think that’s probably less likely at the market level. You really need to look at individual companies and sectors.”
Ghosh is positive on three sectors – and named some of his favorite stocks.
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—Amala Balakrishner
8 hours ago
CNBC Pro: China versus India: The pros explain why they prefer China – and share their stock picks
12 hours ago
After this week’s sell-off, oil prices are settling slightly higher
Oil prices settled slightly higher on Thursday, but remained at three-month lows after a sell-off this week sparked by fears that demand could weaken.
Brent crude oil contracts for January rose 47 cents, or 0.59%, to $80.01 a barrel, while West Texas Intermediate contracts for December rose 41 cents, or 0.54%, to $75.74 a barrel Barrels rose.
Oil markets sold off this week on falling Chinese exports and forecasts that the U.S. will consume less crude this year, while fears of a broader war in the Middle East have eased.
–Spencer Kimball
13 hours ago
The Fed has “not confidently” done enough to bring down inflation, Powell says
Federal Reserve Chairman Jerome Powell said in a speech on Thursday that the central bank believes more may be needed to reduce inflation.
“The Federal Open Market Committee seeks to achieve a monetary policy stance that is sufficiently restrictive to reduce inflation to 2 percent over time; we are not confident that we have achieved such a course,” he said in his prepared speech.
After Powell’s comments, stocks fell to their lows of the day.
—Jeff Cox, Fred Imbert
14 hours ago
10-year Treasury yield rises after weak demand after bond auction
The 10-year U.S. Treasury yield rose 11 basis points to 4.622% after weak demand at the 30-year bond auction. The two-year Treasury yield rose around 4 basis points to 4.98%.
Yields and prices move in opposite directions. One basis point is equal to 0.01%.
See grafic…
10-year US Treasury bond yield
16 hours ago
Fed Chairman Bowman Expects Further Rate Hikes; Barkin advises patience
Federal Reserve Governor Michelle Bowman said Thursday she still expects interest rates to rise but supports the decision earlier this month to stay put.
“There is an unusually high level of uncertainty about the economy and my own economic outlook, particularly given recent data surprises, data revisions and ongoing geopolitical risks,” Bowman said in prepared remarks for a speech to bankers in Florida. “Currently, the federal funds rate appears to be restrictive and financing conditions have tightened since September,” she added.
Separately, Richmond Fed President Thomas Barkin said he expects “some sort of slowdown” in the economy but still thinks inflation is too high. After 11 rate hikes totaling 5.25 percentage points, Fed officials are now in a position to monitor how policy affects the economy and make decisions from there, he said.
“Whether a slowdown that calms inflation will require more from us remains to be seen, which is why I supported our decision to maintain interest rates at our last meeting. Given tight interest rates and tightening financial conditions, we have time to reconcile competing narratives as necessary.” “Test different views on where inflation is heading,” Barkin said.
As governor, Bowman is a voting member of the Federal Open Market Committee, which sets interest rates. Barkin is not on the ballot this year but will be in 2024.
–Jeff Cox