New World declares it's 'business as usual' as the developer denies default risk rumours

The troubled company indicates that residential sales in Hong Kong are showing a steady rise, while sales in mainland China are progressing as expected.

Sales of homes in Hong Kong are steadily increasing, and the firm will persist in promoting its varied ventures in the mainland market, as per the company's announcement.

The team's leadership follows a business strategy based on caution and practicality, fortifying its market-driven approach and improving project profit margins, as per the announcement. The firm has met over 70% of its yearly sales goal for the mainland China market in the six-month period prior to December, the statement additionally mentioned.

Following Bloomberg's earlier reports on Thursday, it was stated that PJT Partners, a firm advising on debt issues, had discussions with a number of the troubled developer's creditors. The talks revolved around the potential that the ongoing debt discussions could result in a default.

Particularly, some bankruptcy provisions in NWD's dollar bonds could possibly be activated after the company started talks with creditors, as per the report.

Experts suggest that Hong Kong has the potential to evolve into a hub for multicurrency bonds with the backing of Beijing. Numerous public institutions in Hong Kong have observed a growing appeal for multicurrency bonds as a means to draw in more global investors, according to UBS.

John Lee Chen-kwok, vice-chairman and co-head of Asia coverage at UBS in Hong Kong, stated that recent strategies implemented by the PBOC, combined with the Hong Kong government's marketing initiatives over the past few years, aim to elevate Hong Kong as a center for bond issuance in various currencies.

Numerous public entities in Hong Kong have noticed a growing fascination for multicurrency bonds among investors keen on diversifying their investments across various currencies.

In 2017, the Bond Connect program was launched to promote the expansion of the bond market in mainland China and Hong Kong. This program enabled international investors to purchase and trade debt that was issued on the mainland. In 2021, the program expanded to include a southbound route, which gave mainland Chinese investors the opportunity to invest in bonds issued in Hong Kong.

Pan made public further improvements to the southbound channel on January 13. Mainland investors are now permitted to purchase bonds valued in US dollars and euros through the connect programme. Additionally, Beijing is set to authorize mainland-based insurance and securities companies to deal in Hong Kong's bond market, a privilege currently limited to banks.

Analysts predict a tumultuous period for Hong Kong residents' MPF investments during the Year of the Snake. They indicate that the impressive yields during the Year of the Dragon may be challenging to replicate, with the US-China trade ties being an unpredictable element.

Philip Tso, who leads institutional business for Allianz Global Investors in the Asia-Pacific region, explained that the snake in the Chinese zodiac represents wisdom, tactical thought, and the capacity to stay calm under pressure. He predicts that under Trump's 'America first' policy and his suggested tariffs, turbulence and global political conflicts will become the primary focus.

The Snake Year is the sixth in the cycle of 12 animal-based years of the Chinese lunar calendar, with each year symbolized by a creature and its alleged characteristics.

From January 21, the 379 MPF investment funds saw an increase of 12.3 per cent in the Dragon lunar year, which started on February 10 the previous year, as reported by MPF ratings, a self-governing research company specializing in pensions. This is set to be the sixth highest lunar-year return since the inauguration of the city's pension plan in December 2000.

According to MPF Ratings, MPF participants experienced a 4.5% loss in the Year of the Rabbit and a 7.8% decrease in the Year of the Tiger over the last two years.

The founder of Nongfu Spring, Zhong Shanshan, has vowed to cease the price war following a year filled with online criticism. He claims that cheap prices are damaging the standard of Chinese goods and negatively affecting the economy.

The relentless chase for cheaper prices, particularly fuelled by online competition, is compromising the quality of Chinese goods and destabilizing China's economy, as stated by the billionaire at a corporate gathering on Thursday. He further mentioned that only those lacking in skill resort to price battles. If one has solid proficiency, superior abilities and genuine innovation, engaging in price wars is not needed.

Although Nongfu expressed its dislike for price competitions, it launched a low-cost bottled water product in April, costing less than 2 yuan (US$0.27), as part of its strategy to recapture its market share.

Zhong confessed in November that the choice to introduce the low-cost item was an impulsive decision. He further stated that the product doesn't hold much value and isn't appropriate for extended use.

Stocks in Hong Kong surge due to Trump's positive outlook on China and a surge on Wall Street

The Hang Seng Index concludes positively for a consecutive week, with Sunny Optical, Xiaomi and Trip.com taking the lead.

The Hang Seng Index saw a 1.9 per cent rise to 20,066.19 this past Friday, marking a second consecutive week of growth with a 1.3 per cent increase over the five-day span. The Hang Seng Tech Index also experienced a significant surge of 3.2 per cent. In mainland China, the CSI 300 Index grew by 0.8 per cent, and the Shanghai Composite Index also saw a slight uptick of 0.7 per cent.

Sunny Optical, a supplier for Apple, was at the forefront with an increase of 8 per cent, reaching HK$73.00. Smartphone manufacturer, Xiaomi, saw a leap of 6.8 per cent to HK$36.85, while travel service provider, Trip.com, moved up 5.3 per cent to HK$541.00.

"Ever since Donald Trump took office, his remarks have caused a fluctuating trend in the Hong Kong market," stated Louis Wong, the managing director at Phillip Capital Management.

Wong stated that Trump's remarks about wanting the Federal Reserve to lower interest rates could benefit Hong Kong's stock market. However, his statements about imposing tariffs on China might cause instability.

The prediction from American semiconductor manufacturer, Texas Instruments, indicates that the semiconductor industry's downturn is continuing. The firm has experienced a consistent decrease in sales over the last nine consecutive quarters, reflecting the ongoing sluggishness prevalent across the electronics sector.

The company announced on Thursday that earnings for the first quarter are expected to be between 94 cents and $1.16 per share. The average predicted by analysts was $1.17 per share, making the company's midpoint estimate of $1.05 per share considerably lower. Revenue is anticipated to fall between $3.74 billion and $4.06 billion, a range that includes the projected estimate of $3.86 billion.

A significant portion of the electronics sector continues to struggle, leading to a continuous decrease in sales for the company over nine consecutive quarters. Texas Instruments leaders also indicated that manufacturing costs have impacted the company's profits.

The company, which is based in Dallas, generates a significant amount of its revenue from industrial equipment and vehicle manufacturers. This makes its forecasts a reliable indicator for the overall global economy.

A quarter of a year earlier, executives from Texas Instruments indicated that certain sectors of the company's market were displaying signs of recovering from an excess supply issue. However, this recovery has not occurred as swiftly as some investors had hoped.

The firm's stocks declined roughly 3 per cent following the announcement in post-market trading. Prior to the close of usual trading hours, the stock had seen an increase of approximately 7 per cent this year.

Tianqi Lithium forewarns a loss of US$1 billion due to a decrease in price and cessation of growth in Australia. The company's reduced earnings at its Chilean branch, foreign exchange losses, and asset depreciations were significant factors in the unfavorable outcomes in 2024.

The business, headquartered in Chengdu, Sichuan province, informed the Hong Kong stock exchange via a document on Friday that it anticipates a net deficit of between 7.1 billion yuan (US$978.3 billion) and 8.2 billion yuan for the previous year. This is a significant change from 2023, when the company reported a profit of 7.29 billion yuan.

Shares of Tianqi experienced a drop of up to 3.5 per cent, but they managed to recover and actually ended with a gain of 1.3 per cent, closing at HK$23.20. Meanwhile, the Hang Seng Index saw an increase of 1.9 per cent.

"Despite the company's lithium compounds witnessing an increase in production and sales, the overall price faced a substantial decline due to market fluctuations," stated Tianqi.

Tianqi stated that a significant decrease in earnings from its foreign subsidiary, Sociedad Quimica y Minera de Chile, adverse currency exchange losses due to the robustness of the US dollar, and substantial asset devaluations primarily due to the cessation of a project's growth in Australia, all played a role in the yearly loss.

Shanghai releases additional spending coupons following unexpected drop in retail purchases

In 2024, the significant economic center in China experienced a downturn in retail sales, marking only the second occurrence in four decades.

Shanghai has declared its intention to release a new set of consumer coupons, in an effort to counteract a decline in consumer expenditure in the major Chinese city.

On Thursday, the metropolis housing 25 million residents revealed a 3.1 per cent drop in retail sales for 2024. This is only the second instance of a decrease in consumer spending in over four decades.

Shanghai's retail sales experienced a decrease, falling to 1.79 trillion yuan (equivalent to US$246 billion) in the previous year. This significant drop was largely caused by a steep decline in the sales of common household items and food services, as per the data disclosed by the Shanghai Statistics Bureau.

Shanghai has only seen a yearly drop in retail sales once before since 1978, and that was in 2022. This decrease, a significant 9.1 per cent, happened due to the city experiencing a two-month lockdown because of Covid, as per information from Wind.

The findings indicate a persistent absence of trust among consumers during a time of economic instability in China, as families concentrate on reducing their spending and increasing their savings.

The rate of household savings in China soared to 55% in the previous year, marking an 11.2 percentage point rise from 2023 and the highest rate seen since 1952, according to a Monday report from Chinese news source, Caixin.

Hang Lung Properties' earnings have plummeted by 46% due to reduced profits from leasing and increased financial expenses. The corporation acknowledges facing challenges in both China and Hong Kong.

The firm's net earnings credited to shareholders dropped to HK$2.1 billion (US$269.7 million), down from HK$3.97 billion the previous year. The decrease includes a net loss in value on certain properties, as reported in a statement released to the Hong Kong stock exchange on Friday.

Total income from rentals declined by 6 per cent, amounting to HK$9.52 billion. The rent income from properties in the mainland saw a 4 per cent decrease, while in Hong Kong, it fell by 9 per cent.

The company stated that on the mainland, consumer trust has suffered due to mediocre economic circumstances, political conflicts, and a faltering worldwide economy.

"The company stated that although the latest economic stimulus actions initiated by China's central government aim to enhance the financial forecast, it's unclear how much they will uplift the entire economy."

Income from rent and sales from its mainland shopping center collection saw a decrease of 3 per cent and 14 per cent, respectively.

The value of occupied residential properties in Hong Kong has decreased for the third consecutive year, marking the most significant downturn since 2003. The cost of previously owned homes experienced a decrease in December, ending a short-lived recovery of two months. Over the past three years, these prices have fallen by 27 per cent.

Residential property prices in Hong Kong dropped in December, marking a continuous three-year decline, amid uncertainties over global politics and inflation that make further interest-rate reductions by worldwide central banks unlikely.

The value in the secondary market saw a decrease of 0.65% in the previous month, a reversal from the increases observed in October and November, as per the information released by the Rating and Valuation Department. The yearly reduction in prices was 7.13%, continuing the downward trend with a 15% fall in 2023 and a 7% shrinkage in 2022.

The aggregate decrease of 27% over the previous three years marks the second most prolonged downturn since the initiation of official monthly records in 1993. The most severe crash in Hong Kong's housing market history occurred from 1997 to 2003, amid the Asian financial turbulence and the dot-com bubble burst, plummeting by 58%.

Derek Chan, the research head at Ricacorp Properties, stated that Donald Trump's victory in the November presidential elections created uncertainty around interest rate predictions. This led to a calming effect on the market and consequently compelled owners of used properties to reduce their prices.

Trump resumed his duties at the White House on January 20, sparking fears that his strategies might fuel inflation and disrupt international commerce. Although the Federal Reserve initiated its cycle of reducing rates in September, economists are now more wary about the extent and pace of these reductions for this year.

One hour and fifty

Trump announces contemplation of a 10% duty on Chinese imports, beginning February 1.

"Trump's decisions can affect the future of interest rates," stated Raymond Cheng, the managing director at CGS International Securities, located in Hong Kong. In addition, he remarked that China's economic forecasts and the performance of its stock market are significant factors influencing the real estate market mood.

ByteDance board member William Ford is hopeful that TikTok can find alternatives to selling in the U.S., according to a report. Ford states that looking into options other than selling is crucial in the company's negotiations with the Trump administration.

TikTok is exploring different options rather than selling its US operations, as ByteDance, its parent company, persists in its efforts to retain its 170 million American users following a respite from the Trump administration, according to a statement by a ByteDance board member cited by Chinese publication Caixin.

William Ford, a board member of ByteDance, expressed confidence in the company's ability to resolve the US government's national security worries without needing to sell off TikTok's US operations, as per a Caixin report on Thursday. Ford shared these views while attending the 2025 World Economic Forum in Davos, Switzerland.

This marks the inaugural occasion where a ByteDance board member has openly discussed the future of TikTok since the commencement of Trump's second term in office.

The chairman of General Atlantic, a ByteDance stakeholder, Ford, has reportedly stated that investigating alternatives to sale is crucial in the firm's discussions with the Trump administration. However, interaction with the Biden administration has been limited.

In a different conversation with Bloomberg TV, Ford suggested that potential solutions might involve "some sort of shift in local control" to adhere to US laws.

Ford conveyed strong optimism for conversations between US President Donald Trump and Chinese President Xi Jinping. He suggested to Bloomberg TV that such discussions could promote a more cooperative atmosphere and a heightened sense of involvement, potentially resulting in a favorable resolution.

Land sales in Hong Kong are projected to bring in approximately US$76 million, despite developers' reservations. The sole residential site available in the New Territories during the last quarter has drawn interest from six developers.

Six property developers from Hong Kong are competing for the sole residential land parcel offered by the government in the previous quarter. However, surveyors anticipate that the bids will be conservative due to economic instability and elevated interest rates.

Among those who placed bids were CK Asset Holdings, Sun Hung Kai Properties, Sino Land, K&K Property Holdings, and China Overseas Land & Investment.

The bidding process for the 3,580-square-meter property located on Mei Tin Road in Tai Wai, Sha Tin, concluded on Friday at midday. The property, capable of accommodating 360 apartments, is roughly a 15-minute walk from the Tai Wai MTR station and is also accessible via a mini-bus route, according to property assessors.

"Anticipations are that the property could fetch a price ranging from US$76 million to HK$620 million, which corresponds to a housing value of HK$3,050 to HK$3,200 per square foot," stated Alex Leung, CHFT Advisory and Appraisal's senior director. He further indicated that the projected apartment price might be approximately HK$16,500 per square foot.

The project's moderate size leads to a relatively low investment sum and risk, stated Alvin Lam, a board member at Midland Surveyors. He added that due to the successful sale of two residential properties in Sha Tin by tender in 2024, the location will likely attract attention as future new supply in the area is anticipated to be limited.