4/15/2021 Financial News: CCP’s Chip Shortage And Price Increase; The Leverage Ratio Of CCP Securities Firms Hits Record High

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1.Upstream Chip shortages and price hike now have spread to supply chain order delays and consumer market impact

(21st Century Business Herald) Shortage and price surge in wafer and packaging costs with prolonged production cycles have driven up the chip prices and now spread to the entire electronics industry in Pearl River Delta Industrial Zone in Guangdong. TSMC announced that it would increase the price of 12-inch wafers by 25%, and then announced an increase in foundry prices from April.

As demand soars alongside limited manufacturing capacity, suppliers are not sure which order they will receive. Therefore, the manufacturers have to suspend order acceptance or delay the delivery cycle. Chip shortages and price increases have severely impacted the global electronics industry chain. Foxconn says that the global shortage of electronic components is worsening and is expected to continue until 2022. For consumer electronics products, supplier chain impacts have been expanded to the consumption market, especially security products.

2.The leverage ratio of mainstream Securities firms hits a record high

(21st Century Business Herald) According to Wind, the total debt of the brokerage industry is 6.43 trillion RMB in 2020, an increase of 1.09 trillion RMB from 2019. The leverage ratio hit a record high, increasing from 3.48 times in 2019 to 3.57 times in 2020. Large brokerage firms are more active in increasing leverage. The leverage ratio of the top 10 securities firms has increased from 4 times in 2019 to 4.4 times in 2020.

Sealand Securities, Dongxing Securities, Guolian Securities and CITIC Securities have launched refinancing plans early this year. In addition, CITIC Securities, CICC, and Shenwan Hongyuan Securities have been approved to publicly issue large amounts of corporate bonds exceeding 10 billion RMB. The average capital leverage ratio of Communist China’s top securities firms is around 20% at present. Bank of China Securities has the highest capital leverage ratio of 43%.

3.Tesla data collected in Communist China is kept in Communist China

(Beijing Reuters) – Sources told on Friday that the Chinese military had banned Tesla cars from entering its complexes, citing security concerns over cameras installed on the vehicles. Data collected from Tesla Inc’s electric cars in Communist China is stored in Communist China, the U.S. automaker’s vice president responded. Tesla Chief Executive Elon Musk said in March his company would be shut down if its cars were used to spy.

4.Hong Kong’s Grade A office vacancy rate up to 10.3% in the first quarter, retail market slowly picks up

(21st Century Business Herald) The vacant floor area of commercial buildings in Hong Kong has risen to 724,000 square feet, increased by 17% from 618,000 square feet at the end of 2020. According to CBRE data, Hong Kong’s Grade A office rents fell by 3.3% in the first quarter, and fell by 17.2% year on year. The overall vacancy rate rose slightly from 0.4% to 10.3% month-on-month.

With the recovery of the local retail market in Hong Kong, shop rents are expected to be out of the bottom. According to data released by the Hong Kong Special Administrative Region Government at the end of March, the estimated total retail sales value in February was 29.5 billion HKD, an increase by 30% year-on-year. The estimate of the total retail sales volume in the first two months of this year increased by 2.7%, ending the 8th consecutive quarters of negative growth. The market sentiment is up. New commercial and commercial shops are expected to be back shortly.

5. Macau moves step closer to digital currency in threat to casinos

(Bloomberg) Macau has moved a step closer to the potential introduction of a digital currency as it seeks to better combat money laundering and tax evasion in the world’s biggest gambling hub. The government plans to amend laws to regulate the issuance of a virtual legal tender and will work with Communist China’s central bank to “study the feasibility of issuing a digital currency,” “The aim of introducing a virtual currency is to improve effectiveness in reducing money laundering, tax evasion and terrorism financing” according to Chief Executive of Macau Ho Iat Seng.

6. Gary Gensler confirmed by Senate to lead the SEC, Wall Street’s top regulator

(CNBC) Gary Gensler will lead the Securities and Exchange Commission after the Senate voted 53-45 on Wednesday to confirm his nomination to head the nation’s top financial regulator. Gensler will play a key role enforcing and drafting the rules that govern Wall Street, investors and financial entities. Progressives expect him to look into digital currencies, the GameStop trading mania and how corporate America prioritizes environmental, social and governance issues.

By 【Financial Team – Apple】
News Collection: 文罡
Proofreading: Tracy

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