What to Watch in Asia Today
George Russell in Hong Kong
Events: Thailand’s Constitutional Court will rule on an appeal by the Move Forward party regarding their leader, Pita Limjaroenrat, and his eligibility to become prime minister. The Asia Pacific Orchid Conference, a five-day event, will begin at the Singapore Expo.
Indicators: The Reserve Bank of New Zealand will announce its decision on interest rates, with Bank of America analysts predicting that the official cash rate will remain at 5.5 percent. China will release data on house prices for July, while the Japan National Tourism Organization will provide information on foreign visitor arrivals in July.
Companies: JD.com and Tencent Music, both from China, will present their quarterly earnings. Hong Kong Exchanges and Clearing, as well as Australian drinks and leisure retailer Endeavour Group, will also release their reports.
Shares of Singapore’s Sea plummet as cost-cutting campaign comes to an end
Jaren Kerr in New York
Singapore-based tech group Sea saw a significant drop in its stock on Tuesday after reporting lower-than-expected revenue numbers and announcing the conclusion of a cost-cutting campaign that began last year. The company’s stock fell by 28.7 percent following the release of pre-market earnings. Sea recorded $3.1 billion in revenue for the quarter, which is approximately 3.2 percent below initial estimates. Despite exceeding forecasts with a net income of $510 million (a 15 percent increase), the company plans to invest more in its e-commerce business. This marks the end of a cost-cutting campaign that began in 2022. Sea’s closing price on Tuesday was 88 percent lower than its peak in October 2021.
Occidental expands its carbon business with $1.1 billion acquisition
Myles McCormick in New York
Occidental Petroleum, a US oil and gas giant, has furthered its involvement in carbon capture with a $1.1 billion deal to acquire technology group Carbon Engineering. This purchase demonstrates Occidental’s belief in the growing carbon management sector, which involves capturing emissions and either storing or reusing them, as the energy transition gains momentum. Occidental is already collaborating with Carbon Engineering on the development of “Direct Air Capture,” a nascent technology that aims to remove emissions directly from the atmosphere. One of Occidental’s DAC projects in Texas recently received a generous cash grant from the federal government.
Restaurant chain Cava reports profitable first quarter since IPO
Jaren Kerr in New York
Cava, a popular fast-casual restaurant chain with a Mediterranean-inspired menu, has surprised Wall Street by reporting a profit in its first quarter as a publicly traded company. The company earned 23 cents per share in the three months leading up to July 9, exceeding analysts’ expectations of a loss of 2 cents per share. Additionally, Cava generated $173 million in revenue, surpassing estimates. Share prices rose 5.8 percent in extended trading and have more than doubled since the company’s listing in June. Investors have shown enthusiasm for Cava, which operates nearly 300 outlets across the United States.
VinFast’s valuation surpasses Ford and GM as shares soar on debut
Jaren Kerr in New York
Vietnamese electric vehicle start-up VinFast has achieved a higher valuation than Detroit’s “Big Three” car manufacturers following a surge in its shares after debuting on the Nasdaq. VinFast closed at $37.06 on Tuesday, well above its agreed-upon debut price of $10. Its market capitalization exceeded $85 billion, surpassing the individual valuations of Ford, General Motors, and Stellantis (the parent company of Fiat-Chrysler) by at least $27 billion. VinFast’s founder, Pham Nhat Vuong, owns approximately 99 percent of the company’s shares. The limited number of public shares for VinFast makes it susceptible to significant price fluctuations.
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