UNITED KINGDOM
Moody’s raises EU issue
An early referendum on the UK’s membership of the EU carries risks that could threaten its credit rating, according to Moody’s Investors Service. While a vote next year would reduce the period of uncertainty surrounding the issue, it also “increases the risk that the UK government will not manage to secure the changes that it is seeking, which in turn may negatively influence the government’s willingness to support remaining in the EU,” Moody’s said yesterday. “A withdrawal from the EU would have negative implications for the UK’s growth prospects and — in the absence of an alternative trade arrangement with the EU that at least partly replicates the current access to the EU’s single market — would likely put pressure on the UK’s sovereign rating.”
MACROECONOMICS
German trade surplus rises
Germany’s trade surplus widened in April from the previous month as exports grew 1.9 percent, official data showed yesterday. At the same time imports fell by 1.3 percent, pushing the trade surplus up to 22.3 billion euros (US$24.8 billion) in April, according to seasonally adjusted figures published by the federal statistics office, Destatis. In unadjusted terms, the trade surplus contracted slightly from March to 22.1 billion euros. On a year-to-year comparison, exports from Europe’s top economy to non-European countries increased by nearly 12 percent in April, while imports grew about five percent. Its export and import flows with other European nations were also up, by 4.5 percent and 1.7 percent respectively, with the biggest jumps seen with non-eurozone members.
ACQUISITIONS
IRM increases Recall bid
Iron Mountain Inc (IRM) increased its bid for Recall Holdings Ltd a second time, adding a cash component to a deal that would value the data storage company at A$3.4 billion (US$2.6 billion) including debt. The Boston-based company would offer US$0.50 in addition to 0.1722 Iron Mountain shares for each Recall share, it said in a statement yesterday. Recall investors would also have a choice of accepting A$8.50 per share in cash, subject to a cap of A$225 million, with preferential access to the cash pool for the first 5,000 shares owned by each shareholder. Recall had been seeking improved terms after a fall in Iron Mountain’s shares cut the value of its offer for the Atlanta-based company, people with knowledge of the matter said last week. Iron Mountain offered investors the same equity ratio, which was equal to about A$7.86 when the takeover was announced on April 28, after its original bid was rejected in December last year.
STOCKS
Japan wins investors
While China’s world-beating stock market rally is generating headlines, some of the biggest Asia-focused hedge funds are looking further east for profits. Hutchin Hill, Indus Capital Partners and Oasis Management (Hong Kong) are among firms touting winning trades among Japanese power producers, makers of foods and beverages and semiconductor parts. A push by Japanese Prime Minister Shinzo Abe to improve corporate governance has made the market a favorite of hedge funds at the same time as fears that Chinese markets are entering bubble territory mount, following gains of as much as 150 percent in the country’s two best-performing stock market indices during the past year. “Global investors are increasingly viewing the country favorably,” Bank of America-Merrill Lynch Hong Kong-based analyst Ben Williams said.
PROTECTION: The investigation, which takes aim at exporters such as Canada, Germany and Brazil, came days after Trump unveiled tariff hikes on steel and aluminum products US President Donald Trump on Saturday ordered a probe into potential tariffs on lumber imports — a move threatening to stoke trade tensions — while also pushing for a domestic supply boost. Trump signed an executive order instructing US Secretary of Commerce Howard Lutnick to begin an investigation “to determine the effects on the national security of imports of timber, lumber and their derivative products.” The study might result in new tariffs being imposed, which would pile on top of existing levies. The investigation takes aim at exporters like Canada, Germany and Brazil, with White House officials earlier accusing these economies of
Teleperformance SE, the largest call-center operator in the world, is rolling out an artificial intelligence (AI) system that softens English-speaking Indian workers’ accents in real time in a move the company claims would make them more understandable. The technology, called accent translation, coupled with background noise cancelation, is being deployed in call centers in India, where workers provide customer support to some of Teleperformance’s international clients. The company provides outsourced customer support and content moderation to global companies including Apple Inc, ByteDance Ltd’s (字節跳動) TikTok and Samsung Electronics Co Ltd. “When you have an Indian agent on the line, sometimes it’s hard
‘SACRED MOUNTAIN’: The chipmaker can form joint ventures abroad, except in China, but like other firms, it needs government approval for large investments Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) needs government permission for any overseas joint ventures (JVs), but there are no restrictions on making the most advanced chips overseas other than for China, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. US media have said that TSMC, the world’s largest contract chipmaker and a major supplier to companies such as Apple Inc and Nvidia Corp, has been in talks for a stake in Intel Corp. Neither company has confirmed the talks, but US President Donald Trump has accused Taiwan of taking away the US’ semiconductor business and said he wants the industry back
PROBE CONTINUES: Those accused falsely represented that the chips would not be transferred to a person other than the authorized end users, court papers said Singapore charged three men with fraud in a case local media have linked to the movement of Nvidia’s advanced chips from the city-state to Chinese artificial intelligence (AI) firm DeepSeek (深度求索). The US is investigating if DeepSeek, the Chinese company whose AI model’s performance rocked the tech world in January, has been using US chips that are not allowed to be shipped to China, Reuters reported earlier. The Singapore case is part of a broader police investigation of 22 individuals and companies suspected of false representation, amid concerns that organized AI chip smuggling to China has been tracked out of nations such