Fears about surging inflation dogged investor confidence in Asia on Thursday, though sentiment was boosted by a report saying teetering Chinese property giant Evergrande had once again avoided a default after meeting bond-payment deadlines.
US investors ran for cover and the dollar soared after a forecast-beating read on the consumer price index, which hit a 31-year high last month, putting fresh pressure on the Federal Reserve to act to prevent inflation from running out of control.
The surge — which came a day after a report showing producer prices accelerating — was fanned by a spike in the cost of various items, particularly gasoline, autos and food prices, and ramped up expectations the central bank will be forced to tighten monetary policy quicker than hoped.
While Fed officials insist the jump will be temporary as the global economy slowly returns to a semblance of normality next year, observers warned the pain could continue for some time.
“Details in the report revealed a broad-based rise in prices, challenging the notion that higher inflation is just a function of transitory factors,” said National Australia Bank’s Rodrigo Catril.
“On top of the several specials from the second quarter reappearing (cars, holidays, etc), rents are trending higher and history shows that once rents get going the trend doesn’t reverse very quickly. Meanwhile, labour costs are also rising.”
And Sarah House at Wells Fargo & Co added: “We’re going to see the inflation picture get worse before it gets better.”
All three main indexes on Wall Street, which started the week posting fresh records, sank into the red for a second successive day.
However, in Asia, the mood was a little lighter after Bloomberg News reported that China Evergrande had stumped up the cash for the interest on bonds due by the end of Wednesday averting a default again, having met two previous deadlines, and slightly easing concerns about its imminent collapse.
Adding to the positive vibe were reports that Chinese authorities were planning to ease some restrictions on developers’ financing, which could give them more leeway to borrow cash to finish projects and raise much-needed cash.
However, Evergrande’s payments were only made after a 30-day grace period that kicked in when it failed to meet its initial deadlines.
And analysts said the outlook for the firm, which is drowning in more than $300 billion of debt, remained uncertain and fears lingered about a spillover into the Chinese or even global economy.
Hong Kong reversed early selling to add one percent, with Evergrande surging 6.8 percent, while Shanghai climbed more than one percent.
Tokyo, Singapore, Wellington, Jakarta and Bangkok were in positive territory. Sydney, Seoul, Singapore, Taipei, Mumbai, Jakarta and Manila all fell.
London dipped after data showed the United Kingdom’s economy expanded 1.3 percent in the third quarter. Paris and Frankfurt were also lower.
Despite ongoing concerns about the outlook, market analyst Louis Navellier remained upbeat.
“Bottom line is that the massive liquidity that has been injected into the capital markets by central banks continues to lift all boats, and stocks continue to possess the best fundamental story with solid earnings, a vibrant IPO market and even many solid dividend plays,” he said.
Shares in Alibaba have fallen as its Single’s Day selling extravaganza was a much more subdued event this yearPhoto: AFP / GREG BAKER
“If inflation is not going to worry investors, what will?”
The dollar held its gains from Wednesday on expectations for higher US interest rates next year, while bitcoin hovered just below $64,900, having clocked another record high of $68,991 as investors increasingly eye the cryptocurrency as a hedge against inflation.
In Hong Kong, Alibaba rose 1.2 percent as it held its latest “Singles’ Day” online sales event.
However, it was a much mode sedate affair compared with previous years. There was hardly any of the razzmatazz it has become known for, with China’s e-commerce giants chastened by a government crackdown on platforms.
Chinese consumers’ demand for smartphone-enabled bargain-hunting has seen the day dwarf the pre-Christmas “Black Friday” promotion in the United States, with Alibaba and rival JD.com reporting combined sales of more than $100 billion in 2020.
But there were no rolling tallies or triumphant comments by executives from major platforms as of Thursday morning, and state media have described a quieter event this year in the wake of Beijing’s campaign to rein in Big Tech.
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Kazakhstan’s President Kassym-Jomart Tokayev issued rare criticism of his long-ruling predecessor Tuesday, and said he expected Russian-led forces to leave the troubled Central Asian country in the next 10 days.
The oil-rich country’s descent into chaos has laid bare infighting at the top of a government once dominated by Tokayev’s mentor, 81-year-old Nursultan Nazarbayev.
The older man retains the constitutional status of “Leader of the Nation” despite stepping down from the presidency in 2019.
Addressing lawmakers in a video conference broadcast live, Tokayev fired an eyebrow-raising broadside at Nazarbayev as the post-Soviet country reels from unprecedented violence that began with peaceful protests over an energy price hike.
Tokayev, 68, said Nazarbayev’s rule had created “a layer of wealthy people, even by international standards”.
Dozens died in the unrest and 10,000 people have been arrestedPhoto: AFP / Alexandr BOGDANOV
“The time has come to pay tribute to the people of Kazakhstan and help them on a systematic and regular basis,” Tokayev added, noting that “very profitable companies” would be asked to pay money into a state fund.
“The current system is oriented towards major structures and is based on the principle: ‘everything for friends and laws for everyone else’,” he said.
Both Kazakhstan and Russia have framed last week’s unrest that left dozens dead and almost 10,000 people arrested as a coup attempt assisted by foreign “terrorists”, but have provided little supporting evidence.
Tokayev blamed his predecessor for creating a rich elitePhoto: SPUTNIK via AFP / Yevgeny BIYATOV
Following a request from career diplomat Tokayev, the Moscow-led Collective Security Treaty Organisation (CSTO) deployed troops to bring about order and shore up the authorities.
On Tuesday, Tokayev announced “a phased withdrawal” would begin in two days and take “no more than 10 days”.
“The main mission of the CSTO peacekeeping forces has been successfully completed,” he said.
The CSTO mission of more than 2,000 troops was deployed at the peak of the crisis, after armed clashes between government opponents and security forces and a looting spree trashed parts of the largest city Almaty.
The decision was a first for the CSTO, often touted by Moscow as a NATO equivalent but previously reluctant to interfere in unrest in Central Asia, a region with long historical ties to Russia.
Nursultan Nazarbayev retains the constitutional status of ‘Leader of the Nation’Photo: AFP / NICHOLAS KAMM
Concern has mounted that Moscow could leverage the mission to entrench its influence in Kazakhstan and US Secretary of State Antony Blinken warned that “once Russians are in your house, it’s sometimes very difficult to get them to leave”.
Tokayev appeared to further bolster his position by backing acting prime minister Alikhan Smailov to take on the job permanently on Tuesday — a nomination that won the unanimous support of lawmakers.
Former national security committee chief Karim Masimov — a key Nazarbayev ally viewed as perpetuating the retired president’s influence over the government — was arrested on treason charges Saturday in connection with the unrest.
Even if Nazarbayev — the son of shepherds who rose through the communist party’s ranks — is now being sidelined politically, dislodging his family’s extensive interests in Central Asia’s largest economy may take time.
In a significant move Tuesday, Tokayev announced plans to bring an end to a widely criticised private recycling monopoly linked to Nazarbayev’s youngest daughter, Aliya Nazarbayeva, 41.
“This should be done by a state organisation, like in other countries,” he said of the scheme.
But middle daughter Dinara and her husband Timur Kulibayev control Halyk, the largest commercial bank, and are among the richest people in the country. Kulibayev is moreover a key player in the flagship oil sector.
Oldest daughter Dariga Nazarbayeva’s political career, mainly in the rubber-stamp legislature, has been marked by a series of controversial statements and perceptions of an abrasive style.
The 58-year-old’s reported business interests are also rumoured to be extensive.
Leaks of offshore financial data and a High Court challenge in London have meanwhile revealed the extent of her family’s foreign property holdings — part of a trend of capital leaving that country that Nazarbayev officially discouraged while president.
Many residents of Almaty credited the CSTO as a stabilising force that had helped Tokayev gain control over the situation after spending several days inside as gunfire echoed around the city.
Roza Matayeva, a 45-year-old English teacher, got used to tuning in to her radio during the five-day internet blackout in Kazakhstan’s financial hub that ended briefly Monday morning before the city of 1.8 million went offline again at lunchtime.
News that the Moscow-led bloc had agreed to Tokayev’s request to send a detachment “brought relief and hope that the situation will be decided for the best in the near future,” she told AFP.
“I welcome cooperation with Russia. I think there is no threat to our sovereignty.”
Tim Cook received $98.73 million in total compensation in Apple’s fiscal 2021
The sum included $82.35 million in stock awards, a $12 million bonus tied to performance targets and a $3 million base salary
He reportedly earned $14.8 million in salary in 2020
Apple CEO Tim Cook’s compensation ballooned to nearly $100 million in 2021, a sixfold increase from the prior year.
The 61-year-old executive, who reportedly earned $14.8 million in 2020, received $98.73 million in total compensation in Apple’s fiscal 2021, according to an SEC filing published Thursday. The company’s fiscal year began in September 2020 and ran through September 2021.
Of this amount, $82.35 million came from stock awards. The sum also included a base salary of $3 million and a $12 million bonus for hitting Apple’s performance targets.
Cook also received $1.39 million in other compensation, including $712,488 in personal air travel, $630,630 in security, a $17,400 contribution to his 401(k) plan, $2,964 in life insurance premiums and $23,077 in vacation cash-out.
Despite the negative effects of the COVID-19 pandemic and supply chain issues, Apple reported 33% revenue growth and more than $365 billion in sales. The increase in annual sales reportedly stemmed from the strong demand over the past two years as consumers working from home splurge on upgrades.
Cook became CEO of Apple in August 2011 after the company’s late founder Steve Jobs stepped down. Jobs died of pancreatic cancer that October.
In 2021, Apple marked the 10th anniversary of Cook’s leadership as CEO.
In September last year, Cook reportedly received 333,987 restricted stock units, in his first stock grant since 2011 as part of a long-term equity plan. He will be eligible to receive additional units in 2023.
A report by Reuters noted that Cook’s 2021 pay was 1,447 times that of the average Apple employee.
In 2021, the median pay for employees was $68,254. In 2020, the median pay was $57,783, 256 times Cook’s salary, according to the publication.
Cook, who has already donated tens of millions of dollars to various charities, previously stated he plans to give away most of his fortune before he dies.
Cook’s net worth was $1.5 billion as of Tuesday, according to a Forbes estimate.
Prior to being named CEO, Cook was Apple’s senior vice president of worldwide operations. At the time, he was earning $500,000 per year. When he became CEO of Apple in 2011, Cook’s salary increased to $900,000 per year.
Between 2011 and 2020, Cook reportedly received $963.5 million in total compensation.
Apple CEO Tim Cook attends Apple’s “Ted Lasso” season two premiere event red carpet at the Pacific Design Center, in West Hollywood, California, July 15, 2021Photo: AFP / VALERIE MACON
The United Nations said Tuesday it needed $5 billion in aid for Afghanistan in 2022 to avert a humanitarian catastrophe and offer the ravaged country a future after 40 years of suffering.
In its biggest-ever single-country appeal, the UN said $4.4 billion (3.9 billion euros) was needed within Afghanistan, while a further $623 million was required to support the millions of Afghans sheltering beyond its borders.
The UN said 22 million people inside Afghanistan and a further 5.7 million displaced Afghans in five neighbouring countries needed vital relief this year.
“A full-blown humanitarian catastrophe looms. My message is urgent: don’t shut the door on the people of Afghanistan,” said UN aid chief Martin Griffiths.
“Help us scale up and stave off wide-spread hunger, disease, malnutrition and ultimately death.”
Since the Taliban hardline Islamist movement seized control of Afghanistan in mid-August, the country has plunged into financial chaos, with inflation and unemployment surging.
Washington has frozen billions of dollars of the country’s assets, while aid supplies have been heavily disrupted.
Afghanistan also suffered its worst drought in decades in 2021.
Without the aid package, “there won’t be a future”, Griffiths told reporters in Geneva.
The Taliban authorities said the aid appeal for suffering Afghans was “very needed”.
“But at the same time I would like to say the need is for all this assistance approved in the past to be delivered during this harsh winter,” senior Taliban leader and the group’s designated UN representative, Suhail Shaheen, told AFP.
He said the inflow of funds would also help in the functioning of the now dilapidated banking system, adding that any cash coming into the country will help rein in the inflation.
The UN said $4.4 billion (3.9 billion euros) was needed within Afghanistan to avert humanitarian disasterPhoto: AFP / Mohd RASFAN
“The banks are not working properly so there is also a need to control the inflation and that can be controlled when dollars … hard currency come to Afghanistan,” Shaheen said.
Griffiths said the appeal, if funded, would help aid agencies ramp up the delivery of food and agriculture support, health services, malnutrition treatment, emergency shelters, access to water and sanitation, protection and education.
An estimated 4.7 million people will suffer from acute malnutrition in 2022, including 1.1 million children with severe acute malnutrition.
Griffiths said that without humanitarian aid, distress, deaths, hunger and further mass displacement would follow, “robbing the people of Afghanistan of the hope that their country will be their home and support, now and in the near term”.
However, if international donors come forward, “we will see the opportunity for an Afghanistan which may finally see the fruits of some kind of security.”
Griffiths said the security situation for humanitarian organisations in Afghanistan was probably better now than for many years, adding that the staff in the ministries in Kabul largely remained the same as before the Taliban takeover.
He said the UN Security Council’s move in December to help humanitarian aid reach desperate Afghans, without violating international sanctions aimed at isolating the Taliban, had made the operating environment for donors and humanitarians on the ground much more comfortable.
The money will go to 160 NGOs plus UN agencies delivering aid. Some will be used to pay frontline workers such as healthcare staff — but not via the Taliban administration.
Around eight million children could miss out on their education because teachers largely have not been paid since August, Griffiths said.
UN refugees chief Filippo Grandi said the aid package’s goal was to stabilise the situation within Afghanistan, including for internally displaced people, thereby preventing a further flood of migrants fleeing across the country’s borders.
“That movement of people will be difficult to manage, in the region and beyond, because it will not stop at the region,” he said.
“If those efforts are not successful, we will have to ask for $10 billion next year, not $5 billion.”