06/07/2026

BIZ & FINANCE MONDAY | JULY 6, 2026

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China investors flock to Hong Kong to trade US stocks

Foxconn Q2 revenue jumps, firm cautions on geopolitics TAIPEI: Foxconn, the world’s largest contract electronics maker, reported a 39.8% year-on-year rise in second-quarter revenue that beat market forecasts on strong demand for AI products, though it cautioned about “volatile” global politics. Revenue for Nvidia’s biggest server maker and Apple’s top iPhone assembler jumped to T$2.513 trillion (RM320 billion) in the April-June quarter, the Taiwan company said in a statement yesterday. That was above a T$2.372 trillion LSEG SmartEstimate, which gives greater weight to forecasts from analysts who are more consistently accurate. Strong AI demand led to robust revenue growth for its cloud and networking products division, while smart consumer electronics, which includes iPhones, posted “significant” growth, the firm said. June revenue alone rose 52.1% year-on-year to T$821.8 billion, a record for that month. Operations are expected to grow both quarter-on-quarter and year-on-year in the third quarter, with AI racks maintaining a growth trend, the company said. However, “it remains necessary to monitor the impact of the volatile global political and economic situation”, Foxconn said, without elaborating. Foxconn, formally called Hon Hai Precision Industry, does not provide numerical forecasts. – Reuters Opec+ set to approve another LONDON: Opec+ is set to agree this week on another increase in output targets from August, sources with knowledge of the matter said, adding to global supply amid falling oil prices due to a gradual reopening of the Strait of Hormuz for oil exports. The oil producing group has agreed in principle to increase quotas by 188,000 barrels per day from August, on top of similar increases for June and July, one Opec+ source said. Two other sources said an increase of this amount was the most likely decision as a result of the online discussion. Seven core members of Opec+, which groups Opec and allied producers including Russia, have increased their output quotas from April through July by almost 800,000 barrels per day. Yet the increase has remained largely on paper because of the US-Israel war on Iran, which closed the Strait of Hormuz for passage of tankers from some of the most important Opec+ members including Saudi Arabia, Kuwait and Iraq. – Reuters output hike, say sources

typically subject to ceilings and strict foreign exchange controls. Designer Iain Wu, a longtime broker platform user, said investors would lose opportunities such as trading newly listed global firms. The measures signal “China’s efforts to control the outflow of citizens’ funds and assets”, he said. “I’m concerned that regulations will tighten even further, such as by limiting the annual investment quota per person,” Wu added. Households, institutions and companies shifted an estimated record of US$807 billion in assets moved out of China in 2025, according to a Bloomberg report citing the Institute of International Finance’s data. The outflows have come as Chinese policymakers have struggled to sustain a post-pandemic economic revival, with annual growth slowing, consumption stuttering and property sector debt mounting. Top leaders have also spooked some investors by signalling a desire to tackle deep-seated wealth inequality. May’s sanctions on brokers are the toughest measures taken by officials in years to plug loopholes that people long used to bypass capital controls. Dick Kay, Deloitte China’s capital market services group leader, said that officials had cracked down on brokers to steer investors towards trading through compliant channels, which are more “manageable”. “Once the so-called grey areas have been narrowed or reduced, the requirements for the legitimate channels... will be expanded”, allowing more people to invest through authorised routes, Kay said. Han Lin, a cross-border finance specialist at The Asia Group consultancy, said Beijing’s move was driven by “concerns over capital outflows, regulatory sovereignty, and unlicensed offshore securities activity”. Investors increasingly see regulatory risk rather than market risk as the key variable shaping overseas investment access, he told AFP. The rules signal that overseas investment should be carried out “on Beijing’s terms”, said Lin. “Future overseas deals will continue, but approvals will increasingly favour strategic sectors aligned with national priorities.”– AFP

crippled the Chinese property sector, long viewed as a safe bet to park assets, analysts told AFP. The new restrictions come after Beijing slapped more than US$330 million in fines in May on major brokers Futu, Tiger and Longbridge, saying they had aided mainland Chinese investors to trade overseas despite lacking the required licences. Authorities ordered the firms to phase out cross-border businesses in China within two years, vowing to “completely eradicate” such illegal operations. Around US$32 billion in Hong Kong and overseas assets held by Chinese investors are traded by the three brokers, according to the companies. An employee from one of the firms told AFP on condition of anonymity that the severity of the crackdown was unprecedented, despite a previous penalty in 2022. Investing in US assets in China usually requires going through officially approved channels and is

capital outflows in recent years. But mainland investors are still streaming to Hong Kong, where regulations are relatively freer, hoping to trade US stocks. Feng, who arrived on an overnight train from eastern China, opened three accounts in one day, telling AFP she did not want to miss the chance to invest in US firms. Although US markets have been volatile recently, “they’re still much better than the Chinese stock market”, she said. Seasoned investor Tao flew to Hong Kong from Shanghai, telling AFP he spent two weeks opening bank and broker accounts to retain access to US stocks. China has long imposed strict foreign exchange controls on its citizens in order to maintain regulatory sovereignty and stabilise the valuation of its currency, the yuan. Mainland investors have been seeking to diversify their holdings in recent years as a debt crisis has

HONG after disembarking at Hong Kong’s train station, Chinese private investor Feng was opening a stock trading account at a nearby brokerage, hoping to evade tighter restrictions on capital leaving the country. Beijing introduced new rules this month cracking down on overseas investments, citing national security concerns and cranking up curbs on buying US shares that were imposed on Chinese investors in May. Market regulators have classified cross-border stock trading by some online brokers as “illegal” and have meted out penalties, hoping to stem what analysts say are record o Beijing introduced new rules this month cracking down on overseas investments KONG: Soon

Individual investors seen at a securities firm in the complex of Hong Kong’s West Kowloon rail station. – AFPPIC

South Korea to create ‘future fund’ from chip windfall SEOUL: South Korea plans to establish a future fund using extra tax revenue generated by a semiconductor boom to invest in growth engines, support for younger generations and efforts to address widening inequality, a top government official said yesterday. Speaking at a meeting between the government and the ruling “At this critical juncture that will determine South Korea’s future, we must not squander additional tax revenue generated by the semiconductor boom and other factors,“ Kang said. He said the fund would support the government’s three “mega Lee’s goal of making South Korea globally “irreplaceable” and urged close cooperation between the government and the ruling party to move quickly. related industries while promoting growth outside the Seoul metropolitan area. Prime Minister Han Sung-sook said yesterday the projects could become a new growth engine if the

The comments come days after Lee unveiled three large-scale industrial projects across the country centred on semiconductors, physical AI and data centres, backed by hundreds of billions of dollars in planned investments by Samsung Electronics, SK hynix and government agencies. The strategy aims to strengthen South Korea’s leadership in chip and AI

government, ruling party and private sector worked as “one team”, describing them as a 30-year strategy linking semiconductors, artificial intelligence, data centres and physical AI. Democratic Party floor leader Han Byung-do vowed legislative and budget support for the projects’ early implementation. – Reuters

projects”, create new growth drivers, respond to what he described as “K-shaped” economic polarisation and provide housing, startup and employment support for people in their 20s and 30s. Kang called the proposed future fund “a cornerstone” for realising

Democratic Party, presidential chief of staff Kang Hoon-sik said President Lee Jae Myung’s administration would use the “Future Response Fund” to help finance major national investment projects and strengthen the country’s long-term competitiveness.