BANKING
Central banks cut Fed swaps
From Monday next week, the world’s top central banks will reduce the frequency of their US dollar operations with the US Federal Reserve after volatility in financial markets receded, the banks said in a joint statement yesterday. The European Central Bank (ECB) the Bank of Japan, the Bank of England and the Swiss National Bank have been conducting daily US dollar swaps with the Fed for the past month, but will revert to weekly tenders, given improvements in US dollar funding conditions, they said. The daily tenders were made available after the failure of Silicon Valley Bank and the sale of Credit Suisse sent jitters across financial markets, raising the risk of liquidity shortages in case confidence falls further. However, the facility was barely used and the takeup was at or near zero on most days since the facility was announced on March 19. “These central banks stand ready to re-adjust the provision of US dollar liquidity as warranted by market conditions,” the ECB said in a statement.
FOOD
Price hikes lift Nestle sales
Nestle SA’s sales growth unexpectedly accelerated, bolstered by Purina and Friskies petfood and as the maker of Nescafe coffee raised prices further. Sales rose 9.3 percent on an organic basis in the first quarter, Nestle said yesterday. Demand was more resilient than expected, as the maker of KitKat bars kept boosting prices near the highest rate in decades. Nestle said pet owners helped drive an increase of 16 percent in petcare revenue. The next biggest gains were in confectionery and coffee, it said. Despite very strong headline numbers, individual units betrayed some weaknesses: Sales declined at Nespresso and Nestle’s vitamins, supplements and minerals business. Capacity constrains also weighed on the water brand Perrier, the company said.
PHARMACEUTICALS
Novartis raises profit outlook
Parmaceutical giant Novartis AG yesterday said it was increasing its full-year sales and profits outlook after strong earnings in the first quarter on the back of a handful of new drugs. The Swiss drugmaker said that its medicines for heart disease, cancer and multiple sclerosis had buoyed earnings in the quarter. The group reported a 3 percent increase in net profit in the first quarter to nearly US$2.3 billion, while sales also rose 3 percent compared with the previous three months to almost US$13 billion. Novartis said that its operating profit would likely increase in the high single-digits this year on the back of strong momentum at the start of the year, while group sales are expected to grow in mid-single digits.
INDUSTRIALS
ABB raises sales forecast
ABB Ltd yesterday raised its guidance for the year after a surge of new orders added to its backlog and higher prices drove better-than-expected results. The Swiss industrial manufacturer now expects comparable revenue to increase more than 10 percent this year, after estimating about 5 percent in February, it said in a statement. New customer orders reached US$9.5 billion in the first quarter, an increase of 1 percent from a year earlier and exceeding an average analyst estimate of US$8.3 billion, it said. ABB added that it plans to delist its American depositary receipts from the New York Stock Exchange, saying it is no longer necessary that investors can trade digitally on multiple platforms. The delisting is expected to take effect on or around May 23.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday said that its investment plan in Arizona is going according to schedule, following a local media report claiming that the company is planning to break ground on its third wafer fab in the US in June. In a statement, TSMC said it does not comment on market speculation, but that its investments in Arizona are proceeding well. TSMC is investing more than US$65 billion in Arizona to build three advanced wafer fabs. The first one has started production using the 4-nanometer (nm) process, while the second one would start mass production using the
When an apartment comes up for rent in Germany’s big cities, hundreds of prospective tenants often queue down the street to view it, but the acute shortage of affordable housing is getting scant attention ahead of today’s snap general election. “Housing is one of the main problems for people, but nobody talks about it, nobody takes it seriously,” said Andreas Ibel, president of Build Europe, an association representing housing developers. Migration and the sluggish economy top the list of voters’ concerns, but analysts say housing policy fails to break through as returns on investment take time to register, making the
‘SILVER LINING’: Although the news caused TSMC to fall on the local market, an analyst said that as tariffs are not set to go into effect until April, there is still time for negotiations US President Donald Trump on Tuesday said that he would likely impose tariffs on semiconductor, automobile and pharmaceutical imports of about 25 percent, with an announcement coming as soon as April 2 in a move that would represent a dramatic widening of the US leader’s trade war. “I probably will tell you that on April 2, but it’ll be in the neighborhood of 25 percent,” Trump told reporters at his Mar-a-Lago club when asked about his plan for auto tariffs. Asked about similar levies on pharmaceutical drugs and semiconductors, the president said that “it’ll be 25 percent and higher, and it’ll
CHIP BOOM: Revenue for the semiconductor industry is set to reach US$1 trillion by 2032, opening up opportunities for the chip pacakging and testing company, it said ASE Technology Holding Co (日月光投控), the world’s largest provider of outsourced semiconductor assembly and test (OSAT) services, yesterday launched a new advanced manufacturing facility in Penang, Malaysia, aiming to meet growing demand for emerging technologies such as generative artificial intelligence (AI) applications. The US$300 million facility is a critical step in expanding ASE’s global footprint, offering an alternative for customers from the US, Europe, Japan, South Korea and China to assemble and test chips outside of Taiwan amid efforts to diversify supply chains. The plant, the company’s fifth in Malaysia, is part of a strategic expansion plan that would more than triple
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