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.
MULTIFACETED: A task force has analyzed possible scenarios and created responses to assist domestic industries in dealing with US tariffs, the economics minister said The Executive Yuan is tomorrow to announce countermeasures to US President Donald Trump’s planned reciprocal tariffs, although the details of the plan would not be made public until Monday next week, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. The Cabinet established an economic and trade task force in November last year to deal with US trade and tariff related issues, Kuo told reporters outside the legislature in Taipei. The task force has been analyzing and evaluating all kinds of scenarios to identify suitable responses and determine how best to assist domestic industries in managing the effects of Trump’s tariffs, he
TIGHT-LIPPED: UMC said it had no merger plans at the moment, after Nikkei Asia reported that the firm and GlobalFoundries were considering restarting merger talks United Microelectronics Corp (UMC, 聯電), the world’s No. 4 contract chipmaker, yesterday launched a new US$5 billion 12-inch chip factory in Singapore as part of its latest effort to diversify its manufacturing footprint amid growing geopolitical risks. The new factory, adjacent to UMC’s existing Singapore fab in the Pasir Res Wafer Fab Park, is scheduled to enter volume production next year, utilizing mature 22-nanometer and 28-nanometer process technologies, UMC said in a statement. The company plans to invest US$5 billion during the first phase of the new fab, which would have an installed capacity of 30,000 12-inch wafers per month, it said. The
Taiwan’s official purchasing managers’ index (PMI) last month rose 0.2 percentage points to 54.2, in a second consecutive month of expansion, thanks to front-loading demand intended to avoid potential US tariff hikes, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. While short-term demand appeared robust, uncertainties rose due to US President Donald Trump’s unpredictable trade policy, CIER president Lien Hsien-ming (連賢明) told a news conference in Taipei. Taiwan’s economy this year would be characterized by high-level fluctuations and the volatility would be wilder than most expect, Lien said Demand for electronics, particularly semiconductors, continues to benefit from US technology giants’ effort
‘SWASTICAR’: Tesla CEO Elon Musk’s close association with Donald Trump has prompted opponents to brand him a ‘Nazi’ and resulted in a dramatic drop in sales Demonstrators descended on Tesla Inc dealerships across the US, and in Europe and Canada on Saturday to protest company chief Elon Musk, who has amassed extraordinary power as a top adviser to US President Donald Trump. Waving signs with messages such as “Musk is stealing our money” and “Reclaim our country,” the protests largely took place peacefully following fiery episodes of vandalism on Tesla vehicles, dealerships and other facilities in recent weeks that US officials have denounced as terrorism. Hundreds rallied on Saturday outside the Tesla dealership in Manhattan. Some blasted Musk, the world’s richest man, while others demanded the shuttering of his
RSS