Live news: Taipei mayor to visit Shanghai amid tense cross-Strait relations

Shares in Adyen were volatile on Friday, a day after an earnings miss disappointed investors in the Dutch-listed payments company and wiped almost €20bn off its market cap.

Hiring costs dented first-half earnings, with remuneration soaring 80 per cent, as did competition in the US, where aggressive pricing from local providers such as San Francisco-based Stripe and PayPal’s Braintree is winning over online merchants. 

Adyen ended the day down 39 per cent, valued at less than €30bn, below the valuation of private rivals such as Stripe and London-headquartered Checkout.com. 

Despite the hit, chief financial officer Ethan Tandowsky said the company would continue with its hiring plans for the year, bucking an industry-wide trend of lay-offs and cost-cutting. 

Japan’s Topix posted its sharpest weekly fall in five months on Friday, as global fears over increased bond yields and China’s stagnant economy sapped interest in the country’s equities.

The Topix fell 0.7 per cent on Friday, taking its weekly losses to 2.9 per cent, its worst performance since mid-March.

Japan’s economy this week posted annualised growth of 6 per cent for the second quarter, its highest level in two years and above consensus forecasts. The country’s equities have performed strongly as new stock exchange guidance and a slower pivot away from decades of ultra-loose monetary policy have boosted valuations.

But rising global bond yields and China’s persistently gloomy economic data dented that momentum this week.

British retail sales fell much more than expected in July as an unusually wet month kept shoppers from the high street, according to official statistics.

The quantity of goods bought in Great Britain fell 1.2 per cent between June and July, following an expansion in the previous three months, according to data published on Friday by the Office for National Statistics.

This was a much larger contraction than the 0.5 per cent fall that was forecast by economists polled by Reuters.

Food stores sales volumes fell by 2.6 per cent in July, with supermarkets reporting that the wet weather reduced clothing sales, although food sales also fell back. Retailers indicated that the rising cost of living and food prices continued to affect sales volumes.

Chinese tech stocks declined on Friday, following weak earnings and pessimism over the country’s economic prospects.

The Hang Seng tech index, which tracks the biggest Chinese tech companies listed in Hong Kong, fell 2.6 per cent, with drops of 9.4 per cent and 7.4 per cent for health tech groups JD Health International and Alibaba Health Information, respectively.

Lenovo, the world’s biggest manufacturer of personal computers, lost 3.9 per cent, while electric vehicle maker Xpeng shed 6 per cent. 

The moves followed the release of a disappointing series of earnings across the sector. Enthusiasm for Chinese equities has also been sapped by weak economic data from the country.

Taipei mayor Chiang Wan-an is to visit Shanghai for a bilateral city conference, as Taiwan and China gradually resume some exchanges after an almost complete three-year break in cross-Strait travel because of the pandemic.

Chiang, a member of the Kuomintang, Taiwan’s largest opposition party that advocates closer ties with China, will participate in the Taipei-Shanghai City Forum this year, his office said on Friday.

First held in 2010, the forum was suspended by the pandemic. Its resumption comes at a sensitive time, with China continuing its military intimidation campaign around the island and debate over cross-Strait relations heating up in Taiwan before next January’s presidential elections.

Country ratings: Moody’s is set to release its updated ratings for Switzerland and Moldova on Friday, while Fitch and S&P are due to update their ratings for the Netherlands and Estonia, respectively.

Kingspan: The Ireland-based construction materials company is to release first-half results.

Women’s World Cup final: Spain and England will meet in the 2023 Fifa Women’s World Cup final on Sunday at Stadium Australia in Sydney. Kick-off is at 11am British summer time.

Asian equities edged lower on Friday morning, as investors assessed the possibility of further interest rate increases by the Federal Reserve.

Hong Kong’s Hang Seng index shed 0.1 per cent, Japan’s Topix fell 0.4 per cent and South Korea’s Kospi slid 0.3 per cent. The mainland Chinese benchmark CSI 300 was flat. 

Minutes from the Fed’s last meeting showed that officials were divided over the need for future rate increases, with some seeing “significant upside risks to inflation”. The US Labor Department on Thursday reported a decline in the number of applications for unemployment benefits for the week ending August 12, adding to the case for tight monetary policy.

Bitcoin fell by nearly 8 per cent during an hour of frenzied trading on Thursday afternoon in the US, extending a day of losses that reversed most of the cryptocurrency’s gains since June.

The price of a token briefly fell to as low as $25,409, according to data from CoinMarketCap, before staging a partial recovery.

The whipsaw price action left the digital asset changing hands for 15 per cent less than the $31,814 high registered in July, echoing recent declines in stocks, bonds and other financial assets.

Read more about Bitcoin’s tumble here.

Falling energy prices nudged Japan’s consumer price inflation rate lower in July, confirming the predictions of central bankers that inflation would slow heading into the second half of the year.

The rate of core inflation, which excludes volatile fresh food prices, was 3.1 per cent, down from 3.3 per cent in June and exceeding the Bank of Japan’s 2 per cent target for a 16th straight month.

Underlying “core-core” inflation accelerated to 4.3 per cent from June’s 4.2 per cent as hotel charges and other service prices rose.

At the BoJ’s latest meeting, one committee member said that the year-on-year rate of CPI inflation was likely to decelerate as the effect of high import prices last year began to subside.

Summits: US president Joe Biden hosts Fumio Kishida and Yoon Suk Yeol, his Japanese and South Korean counterparts, at Camp David on Friday. Biden is set to announce a landmark trilateral agreement that will help Washington and its Asian allies boost deterrence against North Korea and China.

Economic data: Malaysia publishes second-quarter GDP figures on Friday. Economists expect the data to show growth slowing in the quarter that ended in June. Japan, meanwhile, releases consumer price index figures for July.

Markets: Stocks futures declined in Japan and Hong Kong on Friday. A rise in US sovereign bond yields, which neared their highest levels since 2007 on Thursday, weighed on the country’s equities, with the Nasdaq Composite dropping 1.2 per cent and the S&P 500 ending 0.8 per cent lower.

Singapore: Prime Minister Lee Hsien Loong is to give a National Day Rally speech on Sunday, some 10 days after the country’s National Day holiday on August 8. The speech is considered among the most significant political addresses of the year in the island-state.

Troubled property group China Evergrande has filed for bankruptcy protection in a New York federal court using the so-called Chapter 15 process for foreign companies seeking recognition of their restructuring in the US.

According to the petition, Evergrande is also pursuing a parallel “scheme of arrangement” in the Cayman Islands, as well as a restructuring proceeding pending before the High Court of Hong Kong.

The petition was signed by Jimmy Fong, who listed himself as a “foreign representative” of China Evergrande Group. A meeting of “scheme creditors” is set for August 23 at the Hong Kong office of Sidley Austin, the US-based law firm representing Evergrande.

Shares in CVS Health fell more than 8.1 per cent at the close on Thursday after a decision was made by the insurer to drop its Caremark unit as its main pharmacy benefit manager (PBM).

The fall was the largest in a single day for shares in the company — one of California’s largest health insurers — since October last year.

Health plan provider Blue Shield of California said it would work with other companies, including Amazon and the Mark Cuban Cost Plus Drug Company, to supply medicines to its 4.8mn customers.

The insurer said the US drug purchasing system, which is dominated by PBMs — essentially drug middlemen — is “broken” and that it expected to save $500mn in annual drug costs with its new model.