The downturn in China's real estate market has yet to reach its conclusion, with housing sales and rental rates still feeling the strain, according to Fitch. Fitch predicts a 10% drop in total floor space, coupled with a 5% decrease in the average selling price by 2025.

The decline in China's real estate sector is expected to continue this year due to sluggish home sales and construction operations. Fitch Ratings attributes this to "structural issues" such as excessive supply and decreased affordability.

The rating agency announced on Wednesday that the worth of new home sales is anticipated to decline by 15 per cent, amounting to approximately 7.3 trillion yuan (US$1 trillion). This decrease mirrors a 5 per cent reduction in the average sales price and a 10 per cent decrease in total floor area.

The discrepancy between rental income and mortgage rates in prominent mainland cities implies a potential decrease in property values. In an attempt to revive the housing and stock markets, Beijing initiated a financial boost in September. This was aimed at regaining trust from property investors, however, the initial excitement seems to be diminishing.

"Government policies that are favorable have managed to steady the market outlook for the near future," stated Tyran Kam, the senior director and chief of China property. "However, the continuity of this progress is incredibly unpredictable due to large stockpile quantities, unstable job conditions, and the low affordability of homes."

The property market in China is experiencing its fourth consecutive year of struggle. Prior to the introduction of the "three red lines" policy in August 2020 and the impact of the Covid-19 pandemic, the real estate industry accounted for approximately 25% of China's total economic output.

China's multifunctional application, WeChat, has strengthened its online retail reputation through a feature that enables gift-giving. According to domestic news, this function was responsible for over 80% of recent sales generated by the live-streaming online retail company, East Buy, on WeChat.

This function allows customers to look for items on WeChat using specific words. Once the payment is finalized by the person sending the gift, the individual receiving it has to approve the gift and provide a shipping address within a day. If not, the order gets voided and the funds are refunded to the person who made the payment. Each order on WeChat only allows for one gift to be sent to a single friend.

WeChat's official rules state that the maximum price for products offered through this feature is 10,000 yuan, and it does not include items such as jewellery and tutoring services.

China directs pension and insurance funds to the country's A shares to stabilize the stock market

From this year onwards, regulator Wu Qing stated that 30% of the yearly insurance premium from new policies would be invested in A shares, which are valued in yuan.

Financial authorities in China are directing funds from pensions, insurances, and mutual funds into the country's stocks to secure and balance the biggest capital market in Asia. This move has resulted in the largest single-day increase in a key stock index in over a week.

From this year onwards, 30% of the yearly insurance premium from new plans will be allocated to A shares denominated in yuan, according to Wu Qing, the head of the China Securities Regulatory Commission, who made the announcement at a press briefing in Beijing. He also stated that mutual funds would be encouraged to increase their investments, with the allocation percentage growing by 10% annually for the next three years.

Xiao Yuanqi, the Vice-Chairman of the National Financial Regulatory Administration, has announced that a pilot program will reserve a minimum of 100 billion yuan (equivalent to US$13.8 billion) for the stock market within the first half of the year. He further added that half of this amount would be sanctioned prior to the start of the Lunar New Year, which begins on January 29.

The Finance Ministry is currently revamping the investment management process for retirement funds, with the goal of improving investment proportions and increasing flexibility, as per the Deputy Finance Minister Liao Min's statement.

The guidelines have the potential to provide a crucial boost to the capital market, which has been suffering from a sluggish economy, an extended downturn in the property sector, and weak corporate profits. The CSI 300 Index has seen a decline of roughly 30 per cent from its 2021 high point, while global funds' investment in Chinese stocks is at a five-year low, as per Goldman Sachs.

"Wang Qi, the chief investment officer of UOB Kay Hian, believes that the government is making a wise decision by attempting to bring long-term capital into the market. He thinks this could restore trust and stimulate additional capital influx by fostering a profitable environment."

China is funneling pension and insurance funds into the country's A shares to stabilize the stock market. From this year onwards, regulator Wu Qing stated that 30% of the yearly insurance premium from new policies will be invested in A shares denominated in yuan.

China's financial authorities are redirecting pension, insurance, and mutual funds towards the country's stocks to establish and steady Asia's leading capital market. This move has triggered the most significant single-day increase in a key stock index in over a week.

From this year onwards, Wu Qing, the head of the China Securities Regulatory Commission, announced in a Beijing press conference that 30% of the yearly insurance premium from new contracts will be invested in yuan-denominated A shares. He also mentioned that mutual funds will be encouraged to increase their investments, with the allocation rate growing by 10% annually over the forthcoming three years.

Xiao Yuanqi, the vice-chairman of the National Financial Regulatory Administration, has stated that an initial insurance fund of a minimum of 100 billion yuan (equivalent to US$13.8 billion) will be allocated for the stock market as a part of a trial program in the first half of the year. He further mentioned that half of this amount will be sanctioned prior to the beginning of the Lunar New Year, which starts on January 29.

Meanwhile, the Finance Department is in the process of updating the investment management structure for pension funds. The goal is to improve investment proportions and increase adaptability, as stated by the Deputy Finance Minister, Liao Min.

The new orders might offer a critical boost to the capital market, which has been suffering due to a weak economy, a sustained decline in the property market, and lackluster corporate profits. The CSI 300 Index has seen a roughly 30% decrease from its 2021 high point, while international funds' investment in Chinese stocks is at a five-year low, as per Goldman Sachs.

Wang Qi, the head of investment at UOB Kay Hian, expressed his approval of the government's efforts to inject long-term capital into the market. He believes that this move could bolster confidence and stimulate the generation of profit, attracting more capital in the future.

Hong Kong's stock market experiences a downturn as China's strategy to stimulate the market falls short of traders' expectations. Regulators indicate that a minimum of 100 billion yuan from insurance funds will be channelled into A shares as part of an experimental scheme within the initial six months.

The Hang Seng Index experienced a drop of 0.4 per cent, closing at 19,700.56 on Thursday, despite having climbed up to 1.3 per cent earlier. Meanwhile, the Hang Seng Tech Index saw a decline of 1.4 per cent, overturning its initial rise of up to 1.7 per cent.

The CSI 300 Index on the mainland experienced a 0.2 per cent increase, despite an earlier surge of up to 1.8 per cent, marking its greatest rise since January 14. Meanwhile, the Shanghai Composite Index saw a growth of 0.5 per cent.

From this year onwards, 30% of the yearly insurance premium generated from fresh policy sales will be funneled into China's domestic markets, according to Wu Qing, the head of the China Securities Regulatory Commission. He made this announcement at a press briefing in Beijing on Thursday. He also mentioned that these investments would see an annual growth of 10% for the coming three years.

These actions are being taken by China in an attempt to combat the potential impact of tariffs threatened by Trump, who indicated he might impose a 10 per cent tariff on goods imported from China starting from February 1.

Samsung introduces Galaxy S25 smartphones with AI capabilities, exclusively using Qualcomm chips

In a blow to its chip business, Samsung disclosed new AI enhancements in its recent models, completely avoiding the use of the company's Exynos processors.

Samsung gave a sneak peek of a more streamlined variant of their leading models at a California event's conclusion, with plans to release the Galaxy S25 Edge in the initial half of this year, before Apple's expected launch of its thinner iPhone.

Samsung managed to outpace Apple in introducing a smartphone powered by artificial intelligence, however, it struggled to reclaim its top spot in the worldwide smartphone industry last year. This was due to high competition from its American competitor in the luxury market, and from Chinese companies in the more affordable sector.

"In terms of providing AI capabilities, we're leading the industry," said Park Ji-sun, the Executive Vice President in charge of Samsung's Language AI division, in a conversation with Reuters. "I'm confident we're on the right track."

Samsung maintained the cost of its Galaxy S25 series, keeping it steady between $799 and $1,299.

SK Hynix's earnings exceed that of Samsung, yet stock prices fall due to reduced demand for memory chips. The firm indicated that high-performance chips will continue to experience supply shortages, while the need for older models is expected to drop rapidly.

Prior to the announcement of the outcome, the stock of SK Hynix had surged approximately 30% this year due to optimistic outlook fueled by its business negotiations with Nvidia. This performance surpassed Samsung, whose shares only increased by 2% during the same timeframe.

"Concerns are mounting for the memory chip industry this year due to escalating trade restrictions and increasing geopolitical threats, as PC and smartphone manufacturers modify their stocks," stated SK Hynix's CFO Kim Woo-hyun during a financial results discussion with analysts.

The firm announced that the availability of high-performance chips will continue to be limited due to increasing demand. However, the demand for older products is expected to drop at a faster rate.

BNK Investment & Securities analyst, Lee Min-hee, stated that despite a strong performance in the fourth quarter, SK Hynix's shipment predictions for the first quarter chips were not as robust as projected, leaving investors dissatisfied.

The finance sector in China is experiencing an increase in salary caps as part of the 'common prosperity' initiative. A number of government-supported securities companies have already set annual salary limits for top executives. Up next to follow this trend are major banks, insurance companies, and stock exchanges.

Numerous Chinese government-supported financial organizations have already instituted yearly wage limits for their top executives, according to our sources. This move is part of Beijing's ongoing efforts to reduce income inequality.

Financial institutions owned by the central government have established a salary cap of merely 1 million yuan for top executives. However, their subsidiary companies continue to adhere to the prior 3 million yuan limit for these positions, according to an anonymous source.

Brokerage companies are spearheading the implementation of the wage limit, with some still pending to distribute the 2023 yearly bonuses to their employees, according to another insider from a securities company.

The campaign's next targets will be major government-owned banks, insurance firms, stock markets, and regulatory bodies, according to the source.

The creditor of Chinese builder Shimao is pursuing a private lending agreement for a loan worth US$1.3 billion. The loan, coming due on September 30, is supported by a property in the Kowloon Tong district of Hong Kong.

The United Overseas Bank (UOB), headquartered in Singapore, has recently been in contact with potential investors about a loan deal, according to sources. The loan, which Shimao obtained in 2022, is due for repayment on September 30. The lending agreement is secured by the Beacon Peak complex, situated in the Kowloon Tong district of Hong Kong.

The construction company, seeking to sell off properties to repay its lenders, listed 13 sections of the development for sale this month, as per sales paperwork. As of January 18, it has successfully sold three of these, with sales prices varying between HK$28 million and HK$37 million, as confirmed by records.

"Shimao could potentially face difficulties in obtaining a strong sales rate for its latest venture, Beacon Peak project in Kowloon, due to its remote location from transportation hubs," stated Bloomberg Intelligence analysts Kristy Hung and Monica Si in their commentary.

Shimao didn't respond promptly to a call for a remark. UOB didn't react to emails requesting a comment, and phone calls went unanswered.

In a noteworthy business deal, HongShan is set to purchase the sound company Marshall for a sum of US$1.1 billion, according to insider information. The company, which hails from Stockholm, is renowned for their guitar amplifiers that have been favored by celebrated musicians including Jimi Hendrix, Eric Clapton, and Lana del Rey.

HongShan Capital Group is close to finalizing an agreement to purchase the renowned sound gear manufacturer, Marshall Group, according to sources knowledgeable about the situation.

A potential agreement might put the valuation of the Stockholm-based firm, known for its guitar amplifiers used by famous musicians such as Jimi Hendrix, Eric Clapton, and Lana del Rey, at roughly US$1.1 billion, according to sources who wish to remain anonymous due to the private nature of the discussions. The Marshall family, who founded the company, could possibly keep a portion of their share in the business in any deal, the sources indicated.

HongShan, an investment company previously recognized as Sequoia China, appears to be the most probable purchaser of Marshall due to its higher bid compared to other funds, according to sources. The two companies are currently finalizing the details of a possible agreement that may be reached in the upcoming days, the sources added. However, discussions are still ongoing and no definitive decisions have been reached yet.

Numerous private equity companies, which have historically concentrated on China, are now redirecting their focus towards other regions like Southeast Asia, Japan, and Europe.

HongShan operates as a venture capital and private equity company, with investments spread across the technology, healthcare, and consumer industries. Established in 2005, the firm's portfolio includes support for over 1,500 businesses, as indicated on their website. Notable companies they've invested in include Alibaba Group Holding, BYD and ByteDance.

Marshall, a company specializing in audio, technology, and design, originated from the UK in 1962, as stated on their website. They offer a variety of products including amplifiers, headphones, and wireless speakers. The company operates in over 90 different markets.

The US-based fund manager, Federated Hermes, is considering opening an office in Hong Kong as part of its expansion strategy in Asia, according to the CEO. In 2024, the firm managed assets worth $800.5 billion, out of which $3.4 billion were from Asia, not counting Japan.

Chris Donahue, CEO of the globally recognized fund management firm Federated Hermes, which is listed in New York, revealed they are contemplating establishing a branch in Hong Kong. This move aims to broaden their private wealth management and family office services in China and the Asia-Pacific region.

The firm holds a positive outlook towards Asian markets and is particularly taken with the regulatory landscape in Hong Kong. This includes the dedication of market regulators to stimulate expansion in the financial center, even amidst complications such as geopolitical strife.

"He expressed in a recent discussion that Hong Kong serves as a great insight into China," he stated, mentioning that the company is vigorously interacting with customers in the city. "Regardless of the political occurrences, we discard that distraction and focus on the possibilities."

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Trump reveals plans to contemplate a 10% import duty on goods from China, beginning February 1st.

Donahue, who also serves as the company's president and chairman, made his inaugural appearance at the Asia Financial Forum in Hong Kong earlier this month.

Federated Hermes operates out of Pittsburgh, employing over 2,100 people worldwide. The company's Asian base is in Singapore, but it also maintains offices in Australia and Japan. Previously identified as Federated Investors, the company expanded its Asian presence in 2021 when it acquired UK-based Hermes Investment.

The annual report revealed that the managed assets increased by 5.7% in 2024, reaching an unprecedented sum of US$800.5 billion. Approximately US$84 billion of this total was allocated to international stocks, with Asia (excluding Japan) accounting for US$3.4 billion of that investment.

Hong Kong has emerged as a very open market after the conclusion of the Covid-19 pandemic and is a crucial part of Federated Hermes' growth strategies in the area, according to Jim Roland, the chief of Asia-Pacific distribution, who had discussions with a number of regional regulators earlier this month.

Bitcoin ETFs in Hong Kong might become available to investors in the Greater Bay Area due to new regulations. These modifications to China's financial market rules could provide a few individuals from the mainland the opportunity to invest in cryptocurrency products for the first time.

New investment regulations from China, intended to liberalize financial markets, have sparked optimism that inhabitants of the Greater Bay Area in mainland China may soon be able to invest in cryptocurrency-related offerings in Hong Kong, including bitcoin exchange traded funds (ETFs).

The People's Bank of China (PBOC) along with four other financial regulatory bodies declared on Wednesday their plans to enhance the Cross-boundary Wealth Management Connect scheme in the bay area. They intend to aid mainland residents of the region in buying "suitable investment products" provided by financial establishments in Hong Kong and Macau. Moreover, they are looking to broaden the range of institutions involved and the products that qualify.

The regulations don't explicitly refer to digital currencies in Hong Kong, however, the city has initiated several ETF products that directly invest in bitcoin and ether, as part of its goal to evolve into a digital asset center. At present, mainland investors are prohibited from trading in cryptocurrency, but the introduction of this new regulation implies the potential for a limited legal pathway for such investments.

According to Liu Honglin, founder of the Shanghai-based Mankun law firm that focuses on blockchain matters, the guidelines present promising prospects for the crypto and blockchain sector. He shared with the Post on Thursday that it's inevitable for the residents of the bay area mainland to gain permission to access cryptocurrency ETFs.

The interest of citizens from mainland China in digital assets has risen in tandem with Bitcoin's rise to a "conventional alternative asset", according to Liu. He also suggested that due to the growing demand from investors, Chinese authorities might consider "redirecting the flow" to Hong Kong.

Jill Wong, a partner at Reed Smith Richards Butler, a law firm based in Hong Kong, expressed optimism about the reconsideration of cryptocurrency in mainland China. However, she pointed out it's unclear if these new regulations would include crypto assets.