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| Issue 508 | 10 May 2022 |
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Corporate News |
Honeywell raises full-year earnings guidance
Honeywell International Inc., (NASDAQ: HON), a US-based diversified technology and manufacturing company, reported its financial results for the first quarter of 2022. Sales were down 1% yr/yr to US$8.4 billion. There was a loss of approximately US$30 million in sales due to the company’s decision to suspend operations in Russia, which also caused operating margin to decrease 260 basis points to 15.2%. Organic sales, which exclude currency moves, acquisitions and divestitures, rose 1% yr/yr. Adjusted earnings were US$1.91 per share, above estimates. Darius Adamczyk, President and CEO of Honeywell, felt optimistic for the rest of 2022 as there was a solid recovery in the commercial aerospace and energy end markets, enabling the firm to absorb the impact of external macroeconomic factors. Thus, the company raised full-year EPS outlook by US$10 cents to be in the range of US$8.50 to US$8.80. |
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| Asia and Australasia |
Hong Kong: Economy shrinks 4.0% in Q1
The Census and Statistics Department released the advance estimates on GDP for Q1 2022. Hong Kong real GDP decreased by 4.0% yr/yr in Q1, reversing an increase of 4.7% in Q4 2021. The decline was mainly attributable to the continued weak performance in both domestic and external demand, as affected by the COVID-19 pandemic. Over the same period, total exports of goods fell 4.5% yr/yr in real terms compared with an increase of 13.5% in Q4 2021. A Government spokesman said that the economy faced immense pressure in Q1 2022. Domestically, a wide range of economic activities as well as economic sentiment were hard hit by the fifth wave of local epidemic and resultant anti-epidemic measures. Externally, moderating global demand growth and epidemic-induced cross boundary transportation disruptions posed substantial drags to exports. With the gradual relaxation of social distancing measures and various support measures from the government, domestic demand was set to recover in the remainder of the year. The improving local epidemic situation should also be conducive to the recovery of trading activities.
Australia: Retail sales expand 1.6% in March
Preliminary figures from the Australian Bureau of Statistics showed that Australia’s retail sales in seasonally adjusted terms rose 1.6% mth/mth to AUD 33.63 billion in March, reaching a new record level. The strong March sales surpassed expectations in a positive sign for the economy as continued easing of COVID-19 restrictions and soaring prices. By industry, department stores (+4.1%), household goods retailing (+3.4%), and cafes, restaurants and takeaway food services (+2.0%) led the growth. Every state and territory saw a rise in retail sales, contributed by Queensland (+3.4%), Western Australia (+1.9%) and Northern Territory (+1.9%), except for South Australia (-0.7%). On a separate note, Reserve Bank of Australia lifted rates by 25 percentage points to 0.35% to combat inflation and the central bank expected the economy to grow 4.25% in 2022 and 2.0% in 2023 despite the ongoing disruptions from COVID-19, the war in Ukraine, and declining consumer purchasing power from higher inflation. |
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| Europe |
UK: BOE raises rates to combat inflation
The Bank of England (BOE) raised interest rates by 0.25 percentage points to 1.0%, the highest since 2009, citing low unemployment and rising inflation. BOE officials forecasted inflation to rise further over the remainder of the year, reaching slightly over 10% at its peak in 2022 Q4, due to the war in Ukraine and lockdowns in China. In terms of economic growth, the bank expected the economy to expand 3.75% in 2022 and contract by 0.25% in 2023, reflecting the impacts of inflation and income squeeze. Also, the bank signaled further tightening in monetary policy might still be appropriate in the coming months. |
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| North America |
US: USTR begins Four-Year Review of China 301 Tariffs
Last week, US Trade Representative (USTR) announced that it commenced the statutory process required leading up to the four-year review of tariff actions, imposed on China-origin goods, under the Section 301 investigation. In the first phrase, USTR would collect comments from US domestic industries that benefit from the tariff actions. In the second phase, all interested persons could provide comments, including elimination of Section 301 tariffs on particular products, among other changes. US Secretary of the Treasury Janet Yellen and Deputy National Security Advisor Daleep Singh both recently talked about the deflationary impact of tariff reductions. In a separate meeting, USTR Ambassador Katherine Tai commented that all tools were on the table to beat inflation, but tariffs were not top of that list. |
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Webinar
Topic :《Seize export opportunities through risk management under global inflation》
Date : 12 May 2022 (Thu)
Time : 4:00 p.m. - 5:00 p.m. |
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Hong Kong Export Credit Insurance Corporation
2/F, Tower 1, South Seas Centre, 75 Mody Road, Tsim Sha Tsui East, Kowloon, Hong Kong
Phone：2732 9988 Website：www.hkecic.com E-mail：info@hkecic.com |
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