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The Week in Numbers: US and China Reportedly Agree to Tentative Trade Truce

The South China Morning Post reported that the United States and China have agreed to a tentative trade truce, ahead of the G-20 summit in Japan this weekend. The agreement would halt the next round of US tariffs on an additional US$300 billion worth of Chinese goods. Trump held trade talks with Xi in Osaka on Saturday 29 June. China and the US have already imposed tariffs of up to 25% on a few hundred billion dollars worth of each other’s imports.

The Singapore Exchange Limited (SGX: S68) drew the 10th highest initial public offering (IPO) proceeds among global exchanges in the second quarter of the year. Year-to-date, SGX accounted for 61% of IPO proceeds in Southeast Asia. So far this year, there were a total of 48 IPOs in the ASEAN region, 8% lower than in the corresponding period last year. In Asia-Pacific, IPO activity fell 12% to 266 IPOs for the year. Total IPO proceeds raised in the Asia Pacific dropped 27% to US$23.3 billion. Globally, deal numbers were down 28% to 507 IPOs, raising a total of US$71.9 billion.

Meanwhile, the Monetary Authority of Singapore expects second-quarter economic growth to come in lower than the decade-low 1.2% achieved in the first quarter. The US-China trade conflict is expected to weigh down on Singapore’s export-reliant economy. The outlook for electronics, which make up 27% of factory output, is particularly weak, owing to US export controls on US chip makers like Broadcom Inc and Intel Corp.

Minority shareholders of IT retailer Challenger Technologies have managed to successfully challenge an S$183 million privatisation offer. About 11.4% of voters present rejected the offer of 56 cents a share by Challenger chief executive Loo Leong Thye and his family and Dymon Asia Private Equity. For the buyout to succeed, it needed to be approved by 75% of shareholders present and voting, and not opposed by 10% or more.

Bitcoin soared above US$13,000 marking an 18-month high. So far this year, Bitcoin has surged more than 260%. The surge was likely due to renewed interest following Facebook’s announcement to offer its own cryptocurrency, the Libra coin by the end of June 2020.

In its annual report media briefing, the Monetary Authority of Singapore (MAS) said that it would not be relaxing property cooling measures for now as there is only a remote chance of a sell-off. Home values fell for a second straight quarter in the quarter ended 31 March. Luxury home prices were down 2.9% for the quarter, the biggest quarterly decline since the quarter ended June 2009.

MAS chief, Ravi Menon also said that the global economy has weakened and is already affecting Singapore. However, he did say that Singapore is well-placed to ride out the storm. The MAS held S$404 billion of official foreign reserves (OFR) as of April. In FY18/19, the total gain of OFR was S$26.2 billion, comprising investment gains and positive currency translation impact.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended shares of Singapore Exchange Limited and Facebook Inc. Motley Fool Singapore contributor Jeremy Chia owns shares of Facebook Inc.