Global shares advance amid hopes for US-China deal

US shares drifted higher on Monday with Dow futures adding 0.3 percent to 27,931 and S&P 500 futures rising 0.2 percent to 3,119. (Reuters/File)
Updated 25 November 2019

Global shares advance amid hopes for US-China deal

  • Beijing’s new guidelines for protecting intellectual property seen as a key concern for foreign investors

TOKYO: Global shares rose on Monday amid some optimism that the US and China may be edging closer toward a deal on a trade dispute that has been rattling markets for more than a year.

Over the weekend, Beijing issued new guidelines for protecting intellectual property, a key concern for foreign investors and a sore point in the dispute with Washington over trade and technology.

Britain’s FTSE 100 rose 0.9 percent to 7,394, while France’s CAC 40 added 0.4 percent in midday trading to 5,915. Germany’s DAX gained 0.4 percent to 13,221 after a survey showed that German business confidence has increased slightly.

US shares drifted higher with Dow futures adding 0.3 percent to 27,931 and S&P 500 futures rising 0.2 percent to 3,119.

Japan’s benchmark Nikkei 225 surged 0.8 percent to finish at 23,292.81, while Australia’s S&P/ASX 200 added 0.3 percent to 6,731.40. South Korea’s Kospi gained 1.0 percent to 2,123.50. Hong Kong’s Hang Seng jumped 1.5 percent to 26,993.04, while the Shanghai Composite advanced 0.7 percent to 2,906.17.

Investors were watching the situation in Hong Kong, where pro-democracy candidates won a majority of seats in a local district council election Sunday. After nearly six months of often violent protests, it is yet another challenge for CEO Carrie Lam’s government.

“The result might not be market-friendly as it sets to challenge Carrie Lam’s leadership and bring up political uncertainties. But it could also mark a turning point in stopping the violent clashes,” said Margaret Yang, market analyst at CMC Markets in Singapore.

Markets around the world churned last week on uncertainty about whether the US and China can soon halt their trade dispute, or at least stop it from escalating.

Tariffs already put in place have hurt manufacturing around the world, and businesses have held back on spending given all the uncertainty about where the rules of global trade will end up.

New US tariffs are set to hit Dec. 15 on many Chinese-made items on holiday shopping lists, such as smartphones and laptops.

A document issued Sunday called for China to “effectively curb” violations of intellectual property rights such as trademarks and copyrights. The guidelines ordered improvements to laws for protecting such intellectual property, increased compensation for infringements and stricter enforcement of existing laws.

Theft and forced transfers of technology and inadequate protection of copyrights, patents and trademarks are perennial complaints of foreign companies operating in China and are among the key issues in the latest flareup in trade tensions.

President Donald Trump said last week that a deal is “potentially very close” after Chinese President Xi Jinping said Beijing is working to “try not to have a trade war,” but will nevertheless fight back if necessary.

In corporate news, shares in Uber fell about 6 percent in premarket after London’s transit authority refused to renew the San Francisco company’s license to operate there over passenger safety concerns. Uber vowed to appeal the decision, which it called “extraordinary and wrong.” The ride-hailing company has 21 days to file an appeal and can continue operating while the appeals process is under way.

Two blockbuster mergers got Thanksgiving week off to a rousing start Monday morning. Shares of Tiffany & Co. rose nearly 6 percent in premarket trading after Paris-based LVMH said it was acquiring the iconic New York jeweler for $16.2 billion. 

In another massive deal, Charles Schwab said it would buy rival TD Ameritrade in a $26 billion stock swap. With brokerages facing competitive pressure to make it free for customers to trade US stocks online, Schwab’s buyout combines two of the biggest players in the industry, with a combined $5 trillion in client assets. The deal could draw sharp scrutiny from antitrust regulators.


Riyadh property market swells as mortgages surge 250%

Updated 47 min 29 sec ago

Riyadh property market swells as mortgages surge 250%

  • Vision 2030 economic reforms and major infrastructure projects encourage investment into capital’s real estate sector

LONDON: Riyadh recorded a 250 percent jump in mortgages last year as the value and number of property deals surged in the Saudi capital.

The volume of real estate transactions rose by 53 percent in 2019 compared to a year earlier while the value of transactions was up 63 percent according to a report from broker CBRE.

“The recent economic and social initiatives and legislation introduced by the Saudi Government have already had an extremely positive impact on the country’s real estate sector,” said Simon Townsend, head of strategic advisory at CBRE MENAT. “We are already starting to witness impressive growth across major real estate segments including residential, hospitality and retail, and this upwards trajectory is likely to continue in the short to medium term.”

Ongoing economic reforms under the Vision 2030 initiative have encouraged investment into the real estate sector while spending on major infrastructure projects such as the Riyadh Metro and tourism developments on the Red Sea coast have helped to boost confidence despite oversupply concerns.

“Overall, the country is making great leaps in its efforts to become a global business hub and world-class tourism destination, and the market is expected to continue to react positively to the efforts of the public and private sectors alike,” added Townsend.

Residential mortgages for individuals in the Kingdom recorded a growth rate of more than 250 percent in terms of the number of contracts signed from January 2019 — November 2019, according to the CBRE data. The value of contracts rose by more than 160 percent in the same period year-on-year. 

FASTFACT

At the end of last year, the capital’s residential supply stood at 1,290,000 residential units with an expected delivery of 111,000 additional units by 2023.

In October 2019, the Ministry of Housing launched an initiative to support residential renovations by providing financing for residential units more than 15 years old which is expected to result in higher activity among existing aging stock within the central districts of Riyadh.

Beneficiaries of the Saudi Ministry of Housing’s ‘Sakani’ initiative aimed at increasing the national rate of home ownership, grew by about 14 percent in 2019.

At the end of last year, the capital’s residential supply stood at 1,290,000 residential units with an expected delivery of 111,000 additional units by 2023, CBRE said.

Hotel occupancy is also on the rise in the capital and is expected to receive a further boost from Saudi Arabia hosting the G20 summit this year.

The opening of Qiddiya entertainment giga project which is scheduled for 2023 is also expected to benefit the tourism sector.

There are currently about 17,700 hotel rooms in Riyadh with another 4,500 expected to enter the market by 2023. Hotel occupancy has risen by 5 percent year-on-year, CBRE said.