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WhatsApp Makes a U-turn, US-China Kick Off Trade Talks, US Fed May Hike Rates et al

Professor of Financial Economics and Part-time Value Investor, Transfin.
Aug 23, 2018 12:20 PM 2 min read
Editorial

End of Day Wrap-up (Thursday / Aug 23, 2018) #Transfin #WhatsApp #fakenews #L&T #US #China #Xiaomi #Pharma #US #China #tradewars #Fed #FederalReserve #FederalRates #Transfin

Editor's Comment: WhatsApp says it cannot build a software to trace the origin of a message to deter spread of fake information. The company maintains such a software would compromise their end-to-end encryption and is hence not feasible. Disclosure comes a day after the visit of WhatsApp CEO Chris Daniels with India's IT Minister Ravi Shankar Prasad to discuss the fake information issue.



L&T approves its first share buyback of INR9,000cr at a premium of 13% to Tuesday's closing price. Company share price up 2.23% vs Tuesday's close. Commentators mention share buyback may be a result of fallout of limited investment opportunities in engineering, procurement and construction, L&T's aversion to long-gestation projects and strong cash generation.

 

Chinese smartphone maker Xiaomi reports revenues of $6.6bn, +68% yoy in quarter ending June 30th. International revenues up 152%. Company becomes top smartphone seller in India, demonstrates strong profits after difficult IPO in Hong Kong.

 

Indian Pharma Cos approach government to raise ceiling prices of drugs under price control. Companies maintain rising raw material costs are depressing margins which may result in reduced production. Almost 16% of drugs sold in India's domestic market are under price control, with ceilings set by the National Pharmaceutical Pricing Authority.

 

US and China kick off 2 days of trade talks in Washington. China on the back-foot having tried numerous approaches to strengthen economy in the short term, including relaxing credit controls, spiking lending and spending on infrastructure etc.

 

US Federal Reserve signals rate hikes next month. Says if economy continues to perform in line with expectations, they deem “it would likely soon be appropriate to take another step”. Fed also expressed concern over prolonged trade disputes between US and China.