Tag Archives: Trade

Taiwan's Foxconn calls Sino-U.S. trade spat a 'tech war'
June 22, 2018 6:10 am|Comments (0)

TAIPEI (Reuters) – Foxconn, the world’s largest electronics contract manufacturer, on Friday said the U.S. and Chinese governments are engaged in a technology war, not a trade war, describing the spat as the biggest challenge the Taiwanese company is facing.

FILE PHOTO: The logo of Foxconn, the trading name of Hon Hai Precision Industry, is seen on top of the company’s building in Taipei, Taiwan March 30, 2018. REUTERS/Tyrone Siu/File Photo

President Donald Trump on Monday said Washington would hit $ 200 billion of Chinese imports with 10 percent tariffs if Beijing retaliates against his previous announcement to target $ 50 billion in imports. The United States has accused China of stealing U.S. intellectual property, a charge Beijing denies.

“The biggest challenge we’re facing is the U.S.-China trade war. In terms of how we manage and adapt, this is something all our high-level managers are making various plans on,” Chairman Terry Gou said at the company’s annual general meeting.

He did not elaborate on the kind of plans under consideration.

“What they are fighting is not really a trade war, it’s a tech war. A tech war is also a manufacturing war,” he said.

Foxconn is formally known as Hon Hai Precision Industry Co Ltd. It employs over a million workers and has clients including Apple Inc.

Analysts have said a Sino-U.S. trade war could disrupt supply chains for the technology and auto industries – sectors heavily reliant on outsourced components such as those supplied by Foxconn – and derail growth for the global economy.

FILE PHOTO: A motorcyclist rides past the logo of Foxconn, the trading name of Hon Hai Precision Industry, in Taipei, Taiwan March 30, 2018. REUTERS/Tyrone Siu/File Photo

The United States and China are Taiwan’s top export markets.

On Wednesday, shareholder adviser Hermes EOS urged Foxconn to provide more details to investors about succession planning for senior executives and consider separating the chairman and chief executive roles.

Gou, who recently celebrated Foxconn’s 30 years of doing business in China, on Friday said he had no plan to retire in the next five years – years which he described as “important”, without elaborating.

Earlier this month, U.S. watchdog China Labor Watch criticized Foxconn for what it described as harsh working conditions. Gou on Friday said issues such as lengthy overtime were products of Chinese law.

For 2018, Gou said it was necessary to be mindful of uncertainties regarding inflation and the pace of interest rate rises, and that China’s economy continues to be affected by “structural adjustments”.

Shares of Foxconn were down 0.7 percent on Friday, in line with the benchmark stock price index.

Reporting by Jess Macy Yu; Writing by Anne Marie Roantree; Editing by Edwina Gibbs and Christopher Cushing

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China's Leshi questioned by bourse over trade suspension risk
May 9, 2018 6:00 am|Comments (0)

HONG KONG (Reuters) – Leshi Internet Information & Technology Corp Beijing has been formally asked whether its assets, which have fallen 98 percent over the past year, are at risk of turning negative and triggering a share trading halt and possible eventual delisting.

The logo of of Leshi Internet Information & Technology Corp is seen on its building in Beijing, China March 15, 2018. REUTERS/Stringer

The Shenzhen Stock Exchange’s website on Wednesday showed the bourse had sent Leshi 33 questions, including about its assets. Under its rules, a year of negative net assets results in “suspension from being a listed company”, with two years ending in delisting.

Leshi, a video-streaming company that also makes internet-connected television sets, has seen revenue and profit dwindle since mid-2017 amid a funding crisis involving parent conglomerate LeEco and its founder Jia Yueting.

Net assets attributable to shareholders stood at 304 million yuan ($ 47.70 million) at the end of March, from 13.6 billion yuan a year earlier. It reported a net loss of 307 million yuan for January-March 2018 and a loss of 13.9 billion yuan for all of 2017.

The Shenzhen bourse also questioned Leshi about its operations, asset impairment and auditing. It asked the firm to detail its debts, explain slumping performance at subsidiaries, and disclose ownership relations with other companies as well as whether units conduct transactions with other group companies.

It also asked for an update on Jia and his related parties’ repayment of debt to Leshi, and whether there has been a change in the company’s decision-making personnel.

Leshi, which since July has been managed by second-largest shareholder Sunac China Holdings Ltd, in January said Jia and LeEco owed it 7.5 billion yuan. LeEco disputed the figure.

Jia, who remains Leshi’s largest shareholder, has been residing in the United States to work on his electric vehicle start-up company, though Chinese regulators have requested his return.

The Shenzhen exchange has also asked Leshi to explain how its salary expense rose in 2017 though headcount dropped.

It has requested a reply from Leshi by May 18.

A Leshi spokeswoman said the company had no immediate comment when contacted by Reuters.

Leshi’s shares were down 2.6 percent in morning trade in a flat broader market.

Reporting by Sijia Jiang and Hong Kong newsroom; Editing by Christopher Cushing

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Biotech companies Alnylam, Dicerna settle trade secrets case
April 20, 2018 6:05 pm|Comments (0)

BOSTON (Reuters) – Alnylam Pharmaceuticals Inc said on Friday that Dicerna Pharmaceuticals Inc will pay it $ 25 million in cash and stock to resolve a lawsuit claiming it stole trade secrets about gene-silencing technology used to develop drug treatments.

The settlement between the two biotech companies resolves a lawsuit that Alnylam filed against Dicerna in 2015. The accord came ahead of a jury trial that was set to begin on Monday in state court in Woburn, Massachusetts.

Under the agreement, Dicerna said it will pay Alnylam $ 2 million up-front plus 983,208 shares of its common stock.

Cambridge, Massachusetts-based Dicerna said it will also pay Alnylam another $ 13 million over the next four years, the timing of which is dependent on revenue Dicerna receives pursuant to future RNAi technology-based partnerships under its GalXC brand.

Alnylam, also Cambridge-based, in a statement said the deal would also place certain restrictions on Dicerna. Neither company admitted wrongdoing.

Dicerna’s stock was trading at $ 13.20 midday on Friday, up 29.12 percent. Shares in Alnylam were trading at $ 97.59, up 1.46 percent.

Alnylam’s lawsuit accused Dicerna of misappropriating confidential information related to RNAi technology Alnylam acquired when in 2014 when it bought a Merck & Co Inc subsidiary in a deal it valued in court papers at $ 325 million.

RNAi, or RNA interference, prevents a defective gene from making disease-causing proteins.

The lawsuit said Dicerna, which unsuccessfully tried to acquire RNAi assets from Merck, used confidential information it reviewed while considering the potential transaction in violation of a confidentiality agreement.

Alnylam contended Dicerna also hired several Merck scientists who had been involved in developing the technologies its rival acquired as part of an intentional scheme to gain access to trade secrets and confidential information.

Alnylam in court papers filed in Middlesex County Superior Court said the scheme allowed Dicerna to develop “strikingly similar” technologies within a year and unjustly enriched the company by up to $ 325 million.

Dicerna denied the allegations. It filed a counterclaim alleging Alnylam was pursuing a frivolous lawsuit that improperly interfered with its funding sources and partnership opportunities in order to crush its smaller competitor.

Dicerna sought $ 42.2 million in damages. It also filed a related federal antitrust case against Alnylam, which is also being settled.

Reporting by Nate Raymond in Boston; Editing by Tom Brown

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U.S. biotech companies Alnylam, Dicerna settle trade secrets case
April 20, 2018 6:01 pm|Comments (0)

BOSTON (Reuters) – Dicerna Pharmaceuticals Inc on Friday said that it will pay $ 15 million plus stock to Alnylam Pharmaceuticals Inc to resolve a lawsuit claiming it stole trade secrets about gene-silencing technology used to develop drug treatments.

The settlement between the two biotech companies resolves a lawsuit that Alnylam filed against Dicerna in 2015. The accord came ahead of a jury trial that was set to begin on Monday in state court in Woburn, Massachusetts.

Under the agreement, Dicerna will pay Alnylam $ 2 million up-front plus 983,208 shares of its common stock, worth around $ 13.7 million based on the stock’s price at midday on Friday. Dicerna’s stock price was up 38.68 percent.

Cambridge, Massachusetts-based Dicerna said it will also pay Alnylam another $ 13 million over the next four years, the timing of which is dependent on revenue Dicerna receives pursuant to future RNAi technology-based partnerships under its GalXC brand.

“With today’s announcement of a settlement with Alnylam, we are now able to focus the entirety of our resources on the advancement of our key clinical and discovery programs,” Dicerna Chief Executive Douglas Fambrough said in a statement.

Alnylam, also Cambridge-based, did not respond to a request for comment.

Alnylam’s lawsuit accused Dicerna of misappropriating confidential information related to RNAi technology Alnylam acquired when in 2014 when it bought a Merck & Co Inc subsidiary in a deal it valued in court papers at $ 325 million.

(Corrects settlement amount in first paragraph to say $ 15 million)

Reporting by Nate Raymond in Boston; Editing by Tom Brown

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Sentiment Speaks: Mining Stocks Have Been The Most Frustrating Trade For The Last Year
February 11, 2018 6:01 pm|Comments (0)

For those that follow me regularly, you will know that I have been tracking a set up for the VanEck Vectors Gold Miners ETF (NYSEARCA:GDX), which I analyze as a proxy for the metals mining market. I believe that the GDX can outperform the general equity market once we confirm a long term break out has begun, and I still think we can see it in occur in 2018. But, after last week’s break down below the December 2017 low, the set up will have to be resurrected first in the coming months.

I am not sure what more there is to say. We have had several break-out set ups break down in the GDX over the last year. Yet, all the market has done is consolidate sideways for an entire year. Clearly, this is not something I would have or could have expected. Moreover, we still have a 5-wave structure off the 2015 lows, which still keeps us in a longer term bullish perspective.

Since the GDX is a composition of a whole host of mining stocks, I think I have to resolve myself to understanding that the weaker stocks have certainly been a strong drag on the overall fund. So, until the weaker stocks prove they have a bottom in place, it seems quite clear that the GDX will continue to frustrate us.

With that being said, the miners we are holding in our EWT Miners Portfolio are presenting as exceptionally strong, especially relative to the GDX as a whole. Many of them seem as ready to break out similarly to the manner in which GLD seems poised to break out. Yet, when I go back to look at stocks like ABX, it seems quite clear why the GDX has been underperforming.

As you can see from the attached ABX chart, it has followed through down to lower lows in this current pullback. When I highlighted this chart a few months ago to our members of my The Market Pinball Service, I noted this lower low potential, and the ABX is now fulfilling that potential. But, as I also noted in those updates, the long-term potential being presented by this chart is quite strong. As you can see, the positive divergences evident on this chart as the market has dropped down to just below its .618 retracement of its 2016 rally is quite stark. This is often a precursor to a strong reversal which will likely kick off the larger degree 3rd wave which has failed to take hold over the last year.

Within the micro count of ABX, it would seem we are completing the wave v of (C) of y of ii. But, within wave v, we may still see another 4-5 structure before this completes its downside. That means that the 14 region is going to be the resistance over which it will have to rally in impulsive fashion to begin to signal that this wave ii has finally completed. Should that occur, we may see the ABX catch up quite quickly to the rest of the complex behind which it has been lagging.

So, in order to align the GDX chart with the ABX chart, I have to consider any bounce below the 22-22.66 region as being a 4th wave bounce, similar to the potential we see in the ABX. It will take an impulsive rally through the 22.66 region to suggest that the lows have been struck in the GDX, assuming the ABX is also impulsively rallying through its 14 region. Again, we will have to start seeing the laggards in this complex catch up and potentially even outperform to signal that a true low has been struck.

But, in conclusion, even though the GDX technically broke its recent (1)(2) structure, the metals charts still give me reason to remain bullish in the larger degree. As I noted to my subscribers, the short-term indications in my 144-minute silver chart suggest it is trying to bottom out, while the longer-term structure in ABX suggests it should also catch up to the rest of the market, which would allow the GDX to finally break out when the ABX is finally able to complete its longer-term pullback. Until such time, it seems the market is trying to teach us a lesson in patience, such as that exhibited by the biblical figure Job.

Housekeeping Matters

Lastly, it seems that Seeking Alpha has changed the way they tag articles. So, while my articles used to be sent out as an email to those that follow the metals complex, they are now only being sent out to those that have chosen to “follow” me. So, if you would like notification as to when my articles are published, please hit the button at the top to “follow” me. Thank you.

Disclosure: I am/we are long PHYSICAL METALS AND VARIOUS MINING STOCKS.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: I significantly reduced my hedges, and only hold an appropriate amount for portfolio insurance at this time.

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