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To start off, we're looking into:
Evergrande ordered to liquidate
The backstory: Once China's biggest property giant, Evergrande has been thriving since 1996 under the leadership of founder and chair Hui Ka Yan. Following the developer's massive success in real estate, it expanded its ventures into sports, entertainment, finance, health, cars and agriculture. But, in 2020, Beijing introduced new regulations to rein in the mounting debts of major real estate players like Evergrande. Its success came crashing down as it racked up more than US$300 billion in liabilities, winning the company a new title – the world's most indebted property developer. It didn't stop there, though. In 2021, it also became the first property giant to default on its debts, and this set off a chain reaction, with defaults piling up, houses left unfinished, homebuyers protesting and the whole Chinese real estate market in crisis.
More recently: To deal with this crisis, the company made plans to restructure its debt, saying it could get back to normal operations within three years if all went according to plan. Evergrande has been in and out of court for about a year and a half trying to get this debt restructuring plan passed – and it's been through a whopping seven extensions. But things pretty much fell apart in September when Evergrande said its founder, billionaire Hui, was under investigation for "suspected illegal crimes."
The development: After the nonstop problems for Evergrande, then failing again to convince the court it had a doable restructuring plan (and requesting yet another three months of leeway on its debts), Judge Linda Chan said, "Enough is enough." Chan ordered the liquidation of the property giant on Monday in Hong Kong, with shares of the company plunging by more than 20% after the hearing before being halted. Click the link here for more.
PayPal's AI leap
The backstory: Online payments giant PayPal is known for its secure money transfers, but it's made some big moves over the last decade. It acquired Venmo in 2013, a mobile payment service that made splitting bills among friends easy. It also stepped into the cryptocurrency world, allowing US users to buy, sell and hold digital currencies. But PayPal's stock hasn't been doing so well, dropping by more than 22% since January 2023. Recently, there was a change in leadership at the company. Alex Chriss was named PayPal's CEO last August, replacing long-time CEO Dan Schulman in September.
More recently: Chriss, in an interview with CNBC earlier this month, teased some exciting changes, saying they would "shock the world." PayPal announced upgrades, including letting users earn cash back through the app and making online checkouts smoother with a new one-click feature that makes payments easier after you save your details.
The development: Now, PayPal is also rolling out some artificial intelligence (AI) products. Chriss is thinking big for 2024, aiming to boost revenues beyond just online transactions. Click the link here for more.
Blizzard’s new president
The backstory: Activision Blizzard, the giant video game company known for mega-hits like Call of Duty, Warcraft and Diablo, made headlines in October when tech giant Microsoft swooped in and bought it for almost US$69 billion. This deal followed a lengthy regulatory process in the UK and the US over worries that the new mega-gaming behemoth would unfairly stifle competition. But, a few agreements were made to reassure regulators, and the deal was done.
More recently: Last week, Blizzard announced a massive round of layoffs of 1,900 employees at Activision Blizzard and Xbox (most of them at Blizzard). With big changes in the air, Blizzard also canceled an upcoming game known as Odyssey, which had been in the works for six years. Odyssey aimed to be a survival game, like Minecraft, but more advanced. But even though it had a strong team, the project ran into problems, especially with the game's engine. The company also parted ways with President Mike Ybarra and Chief Design Officer and co-founder Allen Adham.
The development: On Monday, Blizzard announced the studio's first new leader since the acquisition. Johanna Faries, former Call of Duty and NFL executive, will be Blizzard's president starting February 5. Click the link here for more.
To end, we'll look into:
Why you should get up and move around
Do you sit at a desk all day long for work? A lot of us do. A recent study done over 13 years was published this month in JAMA Network Open, and the results will have you buying that electric standing desk you’ve been thinking about getting for ages.
The study collected data about occupational sitting, leisure-time physical activity habits, and lifestyle through a health surveillance program of nearly 500,000 people in Taiwan from 1996 to 2017. Results showed that those who mostly sit at work have a 16% higher risk of death from all causes and a 34% higher risk of death from cardiovascular disease. Yikes.
But, researchers also said you can counteract these increased risks with an additional 15 to 30 minutes of physical activity each day. **Stands up to walk around for five minutes** Click the link here for more.
In other news ...
📉Market snapshot and key quotes:
- In the US: US stocks edged up on Monday to a new record high, with everyone watching for big tech earnings and the Fed's take on its interest rate policy.
- In Hong Kong: Hong Kong stocks wrapped up Monday on a high note, thanks to China's new moves to boost its markets.
📊Top gainers/losers and company news:
- In the US: iRobot took a hit, dropping over 8%, as Amazon decided to back off from acquiring the company.
- In Hong Kong: Evergrande slipped almost 21% and hit pause on Monday after a Hong Kong court ordered its liquidation.
👀The numbers everyone is watching:
- In Hong Kong: Watch for China's factory activity figures and Hong Kong's Q4 GDP this week.
- In the US: Microsoft, Apple, Meta, Amazon, Alphabet, plus Dow players Boeing and Merck, are set to unveil quarterly updates.
📅To check out our economic calendar for this week, click here.
More headlines ...
📰Russia/Ukraine update: At a summit in December, Hungary’s PM Viktor Orban blocked a Ukraine funding package for €50 billion (US$54 billion) in aid from the EU. Ukraine desperately needs the money to continue its fight against Russia. In reaction to this, Brussels has proposed ways to exploit Hungary’s economic weaknesses to pressure it into lifting the veto, according to a confidential doc seen by the Financial Times. Hungary has said this essentially amounts to “blackmail,” and it won’t be bullied into backing down. The European Commission has said it was unaware of the proposal. On Thursday, EU leaders will gather to discuss a plan to provide Ukraine with the crucial financial assistance needed.
🎹British pianist has drama with Chinese tourists: A British pianist recording himself playing in a London railway station has gone viral after he was confronted by a group of people from China who asked him to stop filming, as it infringed on their privacy. The situation escalated to accusations of sexual harassment and racial discrimination. There have been mixed reactions to the video showing the situation unfold, with some saying the Brit was a “champion of free speech,” while others say he intentionally set a trap for the Chinese group and was just trying to drive more views to his YouTube channel.
📄Amazon drops US$1.4 billion deal: Amazon announced in 2022 that it planned to purchase vacuum company iRobot, but after running into a problem with EU regulators, Amazon has backed out of the US$1.4 billion deal. Amazon will pay a US$94 million termination fee to iRobot. This decision is a sign of the continued pressure the tech giant faces to prove it doesn’t harm competition in the industry.
🚭UK disposable vapes ban: The UK government has announced legislation to ban disposable vapes as part of its plan to reduce the increasing number of young people vaping. UK PM Rishi Sunak also announced restrictions on vape flavors and requirements on plain packaging for the products so they don’t appeal to children. The legislation will be voted on in Parliament, and it looks likely to pass.
🧑⚖️Racial profiling case in Japan: Three men filed a lawsuit on Monday with the Tokyo District Court against Japan’s national and local governments over police officers stopping and questioning them based on their appearance – which they say amounts to racial profiling. They are all foreign-born but residents of the country. This is the first time Japan has faced a lawsuit like this, and it comes at a time when more foreign workers are coming to Japan to help with labor shortages due to its declining and aging population.
🚜French farmers protest: French farmers blocked eight main highways into Paris with tractors on Monday in protest of EU and French regulations that they say are causing the collapse of rural life. The interior minister, Gérald Darmanin, said the government sent 15,000 police officers and gendarmes to prevent the tractors from entering Paris and other cities where protests were also taking place. The government is currently in talks with union representatives to address the crisis.
👑Prince Harry urged to quit charity: African Parks, an NGO focused on conservation, is facing allegations that park rangers have raped and beaten Indigenous people in the Congo basin. Prince Harry was president of the charity for six years and is currently listed as a member of the board. He’s now been asked to step down in the hope that it will signal to the organization that human rights abuses won’t be tolerated.
⛸️Russian skater banned for doping: Russian figure skater Kamila Valieva has been found guilty of violating an anti-doping rule by the Court of Arbitration for Sport (CAS) and banned for four years. The court also said she’d lose all results, prizes, medals and awards going back to Christmas Day in 2021 when she failed the drug test, including the gold medal won in a team event at the Beijing Winter Olympics in 2022. Her ban will be lifted by the time the 2026 Milano-Cortina Winter Games rolls around.
🏠Hong Kong home prices drop again: Government data showed on Monday that Hong Kong home prices dropped by 1.4% in December, making it the eighth consecutive month of decline. Prices are at their lowest level since 2017, whereas rent soared by 6.6% in 2023.
🛰️Japan’s lunar spacecraft regains power: We recently reported that Japan made history with its first soft lunar landing, but the spacecraft had some problems because its solar panels weren’t working correctly, and it lost contact shortly after landing. But JAXA confirmed on Monday that it had reestablished communication with its SLIM spacecraft, which appears to be in an upside-down position. The space agency was able to resume observations and start snapping some moon pics again.
🕶️Chinese AR glasses: Chinese startup Xreal is aiming to get ahead of the game and compete with Apple, Meta and Google technology in the augmented reality glasses scene, according to CEO Chi Xu per Bloomberg. The company is raising US$60 million in funding, bringing its total to more than US$300 million, which will help it manufacture, research and make developments to meet the demand for its glasses orders for 2025.
What Chinese real estate developer was just ordered to liquidate?
- Longfor Properties
- Country Garden
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