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Emerging Markets Daily - February 5
Kuaishou IPO Soars, The $9.2 Trillion Cost of Vaccine Inequality, Oil Prices Hit '21 High, Alibaba Bond Sizzles, Covax Vaccine Shipments to Africa Begins
The Top 5 Emerging Markets Stories - February 5
Kuaishou IPO Soars, Tripling in Value, Hitting $179 Billion Market Cap - The Hollywood Reporter
“The growing short-form video app raised $5.4 billion and reached a market cap of $179 billion, making it bigger than both Twitter and Uber Technologies.”
“Shares of Kuaishou Technology, China’s second-most popular short-form video app behind TikTok owner ByteDance, rocketed nearly 300 percent Friday in their debut on the Hong Kong stock exchange.”
“Shortly after the opening bell, the stock was selling at more than HK$330, nearly triple the initial public offering list price of HK$115 and valuing the company at $179 billion. The firm, which is backed by Chinese technology giant Tencent, raised $5.4 billion in the market debut, making its IPO the biggest since Uber’s $8.1 billion share sale in 2019.”
“Launched in 2012 as an app for making and sharing GIFs, Kuaishou grew into a short-form video behemoth and later added a vibrant live-streaming service. The platform competes head-to-head with Douyin, TikTok’s Chinese version, and makes most of its money by taking a cut of the virtual tipping, or gift-giving, that followers voluntarily offer to their favorite content creators,” The Hollywood Reporter reports.
Vaccine Inequality Could Cost World $9.2 Trillion - Bloomberg
“The global economy’s recovery risks being dampened or even derailed by the lag in coronavirus vaccinations for poorer nations relative to their wealthier peers.”
“Bloomberg’s Vaccine Tracker shows 4.54 million doses were given on average across the world each day over the last week, but it’s far from an even spread. The U.S. and U.K. make up about 40% of the 119.8 million doses administered globally.”
“Developing and emerging markets are, by and large, doing far less well. In Africa, only Egypt, Morocco, Seychelles and Guinea are recorded as having given any of the vaccines at all. Much of Central Asia and Central America has yet to begin vaccinating, or is moving slowly.”
“That means emerging economies risk falling further behind economically and limits room for rebound even in fully-inoculated countries by depriving them of demand for their goods and a supply of manufacturing parts. Worse still, not combating Covid-19 everywhere may mean harder-to-contain mutations of the virus generate fresh health and economic crises…”
“A recent study commissioned by the International Chamber of Commerce concluded an unequal allocation of injections could deprive the world economy of as much as $9.2 trillion,” Bloomberg reports.
Oil Hits New 2021 High Amid Growth Hopes - Reuters
“Oil hit its highest level in a year on Friday, closing in on $60 a barrel on economic revival hopes and supply curbs by producer group OPEC and its allies.”
“New orders for U.S.-made goods rose more than expected in December, pointing to continued strength in manufacturing. The U.S. Congress is also moving ahead on President Joe Biden’s COVID-19 relief plan…”
“Brent is on track to rise more than 6% this week. The last time it traded at $60, the pandemic had yet to take hold, economies were open and people were free to travel, meaning demand for gasoline, diesel and jet fuel was much higher.”
“The rollout of COVID-19 vaccines, however, is fuelling hopes of lockdowns being eased, boosting fuel demand. But even demand optimists such as OPEC do not expect oil consumption to return to pre-pandemic levels until 2022,” Reuters reports.
Alibaba Bond Sale Sizzles, Attracting $38 Billion Interest - South China Morning Post
“Alibaba Group Holding’s US$5 billion bond attracted an avalanche of orders from fixed-income investors, peaking at US$38 billion, on growing confidence that the e-commerce behemoth will emerge relatively unscathed from an antitrust investigation.”
“The scramble to buy the bonds allowed the platform company to sell its new dollar-denominated debt at a more advantageous price than initially expected, according to people familiar with the transaction.”
“The vote of confidence in Alibaba’s long-term future comes after its founder Jack Ma was summoned by China’s regulators for a dressing down in November and Beijing shelved an initial public offering by its financial affiliate Ant Group at the last minute. China’s antitrust watchdog launched an antitrust probe into the firm’s business practices on December 24.”
“‘I’ve long been declaring that the regulatory threat is overblown, so I was supportive of the new dollar bonds,’ said Brock Silvers, chief investment officer at Hong Kong-based investment firm Taiyuan Capital,” South China Morning Post reports.
Covax to Begin Shipping 90 Million Vaccines to Africa - African Business
“Covax, the global initiative to source Covid-19 vaccines for developing nations, aims to start shipping nearly 90 million doses to Africa this month.”
“The initial phase of 90 million doses will help countries to immunise 3% of the African population most in need of protection, including health workers and other vulnerable groups, in the first half of 2021.”
“As production capacity increases and more vaccines become available, Covax aims to vaccinate at least 20% of Africans by providing up to 600 million doses by the end of 2021.”
“The organisation notified countries of their allocation through letters sent on 30 January. The final shipments will be based on the production capacities of vaccine manufacturers and the readiness of countries to receive them,” African Business reports.