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To start off, we're looking into:
India halts Paytm Bank's operations
The backstory: Indian fintech giant Paytm, also known as One 97 Communications, has long been a key player in India's payment sector, securing early investments from heavyweights like SoftBank and Ant Financial. The company essentially makes it easier for people to make payments and transfer money, kind of like competitors Venmo and Google Pay.
Paytm completes its transactions in India through a separate arm called Paytm Payments Bank, which has gotten heat from regulators after an audit brought up accounting and supervisory problems, according to insiders speaking with Bloomberg. Regulators have warned Paytm about these issues over the past few years. They've also brought up concerns with top execs wearing hats in both the bank and the tech company, which might cause conflicts of interest.
The development: The Reserve Bank of India (RBI) has now hit the brakes on Paytm Payments Bank's operations. The RBI said this was because of persistent non-compliance and supervisory concerns and said the firm has to stop all its mobile wallet and banking activities after February 29. Click the link here for more.
Binance is sued over Hamas link
The backstory: It's no secret that the crypto world has been under a lot of scrutiny, and recent events have brought Binance, the world's largest crypto exchange, into the spotlight as it goes back and forth with the US government over crypto regulation.
More recently: Last March, the US Commodity Futures Trading Commission (CFTC) accused Binance of violating anti-money laundering and sanctions laws, saying it failed to report shady transactions involving terrorist groups, ransomware, scams and more. One big accusation was that Binance was used to send money to Hamas, the Palestinian Islamic Jihad, al-Qaeda and the Islamic State of Iraq and Syria.
Binance pleaded guilty, resulting in a historic US$4.3 billion settlement. Founder Changpeng Zhao also pleaded guilty to charges and stepped down as CEO. He was fined US$50 million and could face time in prison.
The development: Binance is in hot water again for similar allegations. Judith Raanan, an American mom who was held hostage by Hamas along with her daughter, and two relatives of men killed in the October 7 attack on Israel are suing the exchange. Click the link here for more.
India’s role in the AI sphere
The backstory: With artificial intelligence (AI) on the rise all around the world, the race is on for developing, applying and regulating the new technology, and India is emerging as a key player. The International Monetary Fund (IMF) published a piece in December about the potential India has to produce and use AI, saying, "Indians will use AI every day more than in any other country in the world," adding that the nation's on the verge of a technological revolution. With India's advances in space technology last year, this isn't too much of a surprise.
India currently has over 5 million programmers, and it's on track to have one of the largest pools of AI talent for startups and global businesses. As AI advances, expertise in the tech is limited, but India could help solve that problem. Last year, Nvidia CEO Jensen Huang went on a tour of India and said that the country could be the world's largest exporter of AI expertise.
The development: Over the next week, top executives from Microsoft and Alphabet (the parent company of Google) are touring India to introduce themselves to the market and its many programmers while pushing for adopting more AI services. Click the link here for more.
To end, we'll look into:
Temu’s older demographic
Ready to shop ‘til you drop? Temu is an online marketplace with lots of different products, similar to Amazon, but at super low prices. Launched in 2022, Temu is owned by PDD Holdings, the parent company of Chinese retailer Pinduoduo. It first kicked off in the US before expanding to other markets, like the UK, Spain, Italy, France and the Netherlands. It’s easily become one of the most downloaded apps because of its low prices and gamified shopping experience. But surprisingly, it’s resonated particularly with boomers and Gen Xers.
While the Temu app aimed to target younger consumers in the US, older generations have spent a lot more time and money on the platform than the initial target market, according to the Chicago research company Attain. Click the link here for more.
In other news ...
📉Market snapshot and key quotes:
- In the US: US stocks closed higher on Thursday, recovering from a selloff after the Fed hinted at no rate cuts in March.
- In Hong Kong: Hong Kong stocks rose on Thursday after a 3% loss in two days, boosted by hopes for more economic support from China, offsetting the Fed's no-cut warning.
📊Top gainers/losers and company news:
- In the US: Honeywell dropped almost 2.5% as Q4 revenue missed forecasts.
- Peloton fell over 24% due to a weak outlook, making investors nervous.
- In Hong Kong: Meituan jumped 2.5% and Alibaba gained over 2%.
- Longfor Group lost 1.7%, and China Resources Land dropped 1.5%.
👀The numbers everyone is watching:
- In the US: US productivity rose 3.2% in Q4, beating expectations, but unit labor costs increased by 0.5%. Initial jobless claims were higher than expected at 224,000.
- In Hong Kong: The Caixin China manufacturing PMI for January stayed steady at 50.8.
📅To check out our economic calendar for this week, click here.
More headlines ...
📰Middle East update: Over the weekend, a US military base in Jordan (near the Syrian border) was attacked, killing three US soldiers and injuring at least 40 others. The US has said the Islamic Resistance in Iraq, an Iran-backed militant group, was responsible and has announced plans for multiple airstrikes on targets, including Iranian personnel and facilities, in Syria and Iraq, according to CBS news.
On Thursday, the US also launched two strikes in Yemen against the Houthis, also an Iran-backed militant group that has been causing widespread disruption in the Red Sea. One of the strikes took out 10 Houthi drones and a drone-control center that officials said was a threat to US Navy vessels and merchant vessels, and the other strike destroyed a Houthi surface-to-air missile that was going to be launched later that day, according to US Central Command.
Also on Thursday, the Qatari foreign minister said that Hamas had given "initial positive confirmation" to a proposal for a truce in Gaza and the release of hostages. There's no deal yet, and talks will continue this week, mediated by Qatar, the US and Egypt. The US Biden administration also imposed sanctions on four men accused of being involved in settler violence in the West Bank. UN data shows that daily settler attacks have more than doubled since the October 7 attack by Hamas.
🗞️Russia/Ukraine update: In an EU summit in December, Hungary's PM Viktor Orbán blocked the EU's €50 billion (US$54 billion) aid package for Ukraine, which it needs to continue fighting Russia. Orbán was under pressure from other EU leaders to lift the block since Hungary was the only holdout, and on Thursday at another EU summit, Orbán agreed to approve the package. Ukrainian President Volodymyr Zelenskiy welcomed this agreement as the war approaches its 3-year mark. The first chunk of the money is expected to be sent over in March, and EU leaders hope this will encourage the US to approve the aid package currently being held up by opposition in Congress.
🚢South China Sea update: Amid growing tensions over disputed territory in the South China Sea, the Philippines has announced plans to spend up to 2 trillion pesos (US$35 billion) to enhance its military's capabilities over the next decade and purchase the country's first submarine to defend its maritime sovereignty. This is the final stage of a three-phase modernization plan that began in 2013.
💻Chinese hackers: The US has accused a Chinese hacker group, Volt Typhoon, of attempting to hack key infrastructure systems, like power grids and gas and water pipelines, in an effort to target US civilians. The group also allegedly tried to access government email accounts last May. The FBI said it had completed a campaign to shut down the group.
😲Beheading video on YouTube: In a story that's gone viral online and shocked the world, 32-year-old Justin Mohn was arrested in the US and charged with murder and abusing a corpse on Wednesday after he decapitated his father. Mohn uploaded a 14-minute-long video to YouTube where he ranted about the government and showed his father's decapitated head on screen. YouTube removed the video and said it's closely monitoring for any reuploads. But the video got thousands of views in the hours it was available, bringing more heat to social media companies over how they monitor offensive and illegal content.
😡Singaporean backlash against US Senator: In a US Senate hearing on Wednesday addressing child safety on social media platforms with industry CEOs, TikTok's CEO Shou Chew was asked a series of questions about his nationality and his links to the Chinese Communist Party (CCP) by US Senator Tom Cotton. TikTok is owned by Chinese tech firm ByteDance. Chew repeatedly reiterated that he is Singaporean, not Chinese. Many Singaporeans have since taken to social media saying that Cotton was being racist, and the hashtag #Singaporean was trending internationally on X. "Just because he looks Chinese does not mean he's from China," said one post. "When it's 2024 but people still think Singapore is in China" was posted with a clip of the exchange by popular Instagram meme page, @Yeolo.sg.
💳Cashless Hong Kong cabs: Under a new trial scheme, more Hong Kong taxis are set to begin accepting cashless payments using the "CabCab" meter technology. Developers said on Wednesday it would be tested on 100 red and green taxis under a pilot scheme in March before accepting cashless payments as early as April. But there may be an extra fee in the future for passengers using the service.
🐒Monkeys take over Thai city: Lopburi in Thailand is well known for its monkeys, which have long been a tourist attraction, and it even holds an annual monkey festival to thank them for drawing in tourists. But the monkey business has gotten out of control. A large part of Lopburi city has been overrun with some 3,500 monkeys destroying shops and harassing visitors, leading to many companies and stores closing down and leaving the area. Chinese investments in the city are now on hold, and it's at risk of becoming a ghost town if the situation doesn't improve.
🏎️Hamilton goes Ferrari: In a racing bombshell, Formula One's most successful driver of all time, seven-times world champion Lewis Hamilton, has activated a release in his Mercedes contract, and he'll race for Ferrari from 2025. Hamilton has driven for Mercedes since 2013 and is in his 12th season this year.
⚽Messi in Hong Kong: Renowned football player Lionel Messi is due to arrive in Hong Kong on Friday with his teammates from Inter Miami for a friendly game against Hong Kong's local premier league team. Messi and his team will be welcomed with a ceremony at the airport, and roads on Hong Kong Island will be closed over the weekend near Hong Kong Stadium. Fans are pretty pumped up, with Inter Miami kits flying out of local stores ahead of the team's arrival.
🤷♀️Margot Robbie responds to Oscar's snub: Many people have been talking about "Barbie" star Margot Robbie and the film's director Greta Gerwig not being nominated in their respective categories at the Oscars this year. After comments from co-star Ryan Gosling, who was nominated for best supporting actor, saying he was disappointed at the snub, Robbie has broken her silence on the matter. "There's no way to feel sad when you know you're this blessed," she said. But she did say that "Barbie" director Gerwig should've been nominated.
What country is emerging to be a key player in developing AI, according to industry leaders?
- The United States
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