CPCAY - Cathay Pacific Airways Limited

Other OTC - Other OTC Delayed Price. Currency in USD
6.73
-0.17 (-2.46%)
At close: 3:45PM EDT
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Previous Close6.90
Open6.67
Bid0.00 x 0
Ask0.00 x 0
Day's Range6.66 - 6.80
52 Week Range5.97 - 8.97
Volume23,170
Avg. Volume20,356
Market Cap5.334B
Beta (3Y Monthly)0.81
PE Ratio (TTM)79.18
EPS (TTM)0.09
Earnings DateN/A
Forward Dividend & Yield0.23 (3.33%)
Ex-Dividend Date2019-09-03
1y Target EstN/A
Trade prices are not sourced from all markets
  • Cathay Pacific’s Crisis Puts Spotlight on Shareholder Air China
    Bloomberg

    Cathay Pacific’s Crisis Puts Spotlight on Shareholder Air China

    Sep.09 -- China’s crackdown on Cathay Pacific Airways Ltd. has raised a new question: could one of its top shareholders take over the airline completely? State-run Air China Ltd. already owns almost 30% of Cathay, leading some to speculate on a potential merger. Angus Whitley reports on "Bloomberg Markets: China Open."

  • Hong Kong Exchange’s China Ties May Backfire in LSE Quest
    Bloomberg

    Hong Kong Exchange’s China Ties May Backfire in LSE Quest

    (Bloomberg) -- When Hong Kong Exchanges & Clearing Ltd. bought the London Metal Exchange in 2012, the access it offered to the Chinese market was a big plus.But with questions mounting over Beijing’s role in Hong Kong affairs, those ties now represent a threat to HKEX’s 29.6 billion-pound ($36.6 billion) bid for the London Stock Exchange Group Plc.It’s an unfamiliar position for the corporate leaders who have made their drama-free links to Beijing key to their international appeal. Amid the U.S. trade war and scrutiny over China’s role in Hong Kong’s social unrest, the connections are emerging as a commercial handicap. Further complicating HKEX Chief Executive Officer Charles Li’s audacious offer is the $27 billion deal LSE made in July for data provider Refinitiv. Scrapping that is a condition of HKEX’s bid.“LSE is at the center of Britain’s financial market,” said Cecelia Zhong, CEO of Guojin Resources Ltd. and a former HKEX executive. “As it is busy focusing on its own data deal right now, the last thing LSE wants to consider is foreign ownership, particularly a Chinese player to control it.”The Hong Kong government, which owns 6% of HKEX, appoints six out of the company’s 13 board members, and the city’s chief executive -- a person appointed by Beijing -- picks the company’s chairman. The structure means the exchange operator comes under a level of political oversight unusual among other developed market bourses.Other Hong Kong companies have faced similar challenges even before the protests exploded earlier this year into the biggest crisis in Hong Kong since the city’s return to China in 1997.Deals VetoedIn November, Australia rejected a A$13 billion ($9 billion) gas project bid by Hong Kong tycoon Victor Li’s CK Infrastructure Holdings Ltd., calling it contrary to national interest. The decision followed a torrent of criticism in Australia that Hong Kong companies were just as susceptible to Beijing’s influence as those on the mainland. U.S. regulators last year rejected a bid by a Chinese-linked consortium to take over the Chicago Stock Exchange, a deal that then-candidate Donald Trump blasted when it was announced in 2016.The unrest also put unwelcome pressure on Hong Kong companies, particularly Cathay Pacific Airways Ltd., which faced a heavy backlash from China in the wake of its employees joining protests.About a month ago, China’s civil aviation authority began clamping down on Cathay, prompting the carrier to fire staff and threaten to terminate workers for even supporting the demonstrations -- let alone participating in them. Both the airline’s chief executive officer and chairman have since announced their resignations.“What we’ve seen with the Cathay Pacific example is that there is, whether direct or indirect, influence and pressure on Hong Kong companies, which I think some hoped was not necessarily there,” said Fraser Howie, who has two decades of experience in China’s financial markets and co-wrote the 2010 book “Red Capitalism.”China told its biggest state-run firms to take control of Hong Kong companies, Reuters reported Friday, a move that could further fuel concern that the mainland is stepping up efforts to play a bigger role in the former British colony. ‘British Institution’In a call with reporters on Wednesday, Li was asked about fears over China’s influence, and referred to the LME takeover. He recalled comments at the time that the deal would amount to a Chinese takeover -- concerns that haven’t borne out, he said.“We do not have Chinese management at all in the London Metal Exchange,” he said. “If you walk onto the floor, you will see a quintessential British institution.”HKEX shares fell 3.5% in Hong Kong on Thursday, and rose 1.3% Friday. LSE is trading at about 14% below the offer price, highlighting skepticism that a deal will get done. A statement from the London bourse called Wednesday’s offer an “unsolicited, preliminary and highly conditional proposal.” LSE was set to spurn the offer, people familiar with the matter said.LSE’s effort to complete its purchase of Refinitiv, the business that used to be Thomson Reuters Corp.’s financial and risk unit, is a big reason why HKEX’s bid is unlikely to succeed, said Jonas Short, head of the Beijing office at Everbright Sun Hung Kai Securities. Likewise, LSE shareholders including Jupiter Asset Management and Aberdeen Standard Investments indicated they prefer the British bourse’s planned takeover of Refinitiv -- a strategic move to expand in data that HKEX wants to scrap.Commercial strategy notwithstanding, the British government has the power to scrap the deal on public-interest grounds. “The London Stock Exchange is a critically important part of the U.K. financial system, so as you would expect, the government and the regulators will be looking at the details closely,” said a spokesperson for the U.K. government on Wednesday.Not all acquisitions involve strategic assets. Victor Li’s CK Asset Holdings Ltd.’s agreed to pay 2.7 billion pounds ($3.3 billion) for Greene King Plc, which operates more than 2,700 British bars, restaurants and hotels.Still, Brock Silvers, managing director at Kaiyuan Capital, said the heightened scrutiny on Chinese entities won’t recede even after an end to the trade war, and it’s almost certain, he said, that HKEX will be viewed as a Chinese company.“An eventual deal would expose LSE to a variety of Chinese corporates and government entities, and some of those relationships could be highly problematic from political, compliance, or know-your-customer perspectives,” he said.(Adds details of Reuters report in 11th paragraph)\--With assistance from Alfred Liu, Lucille Liu and Benjamin Robertson.To contact Bloomberg News staff for this story: Kiuyan Wong in Hong Kong at kwong739@bloomberg.net;Evelyn Yu in Shanghai at yyu263@bloomberg.netTo contact the editors responsible for this story: Candice Zachariahs at czachariahs2@bloomberg.net, James Hertling, Sam MamudiFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Will the Recent Boeing 777X Setback Hurt Airline Industry?
    Zacks

    Will the Recent Boeing 777X Setback Hurt Airline Industry?

    The recent explosion in Boeing's 777X's cargo door forces Boeing to suspend the structural load tests of this jet family.

  • Cathay Pacific freezes new hiring, to focus on cost cuts - memo
    Reuters

    Cathay Pacific freezes new hiring, to focus on cost cuts - memo

    Cathay Pacific Airways Ltd has put a freeze on new hiring, according to an internal memo seen by Reuters, as the airline battles a slump in demand from fliers avoiding Hong Kong amid massive anti-government protests in the city. In a memo to staff on Wednesday evening, new Chief Executive Augustus Tang said he had asked executives to examine spending and focus on cutting costs. The airline will also not replace departing employees in non-flying positions unless approved by a spending control committee, he said.

  • Cathay Pacific freezes new hiring, to focus on cost cuts: memo
    Reuters

    Cathay Pacific freezes new hiring, to focus on cost cuts: memo

    Cathay Pacific Airways Ltd has put a freeze on new hiring, according to an internal memo seen by Reuters, as the airline battles a slump in demand from fliers avoiding Hong Kong amid massive anti-government protests in the city. In a memo to staff on Wednesday evening, new Chief Executive Augustus Tang said he had asked executives to examine spending and focus on cutting costs. The airline will also not replace departing employees in non-flying positions unless approved by a spending control committee, he said.

  • Financial Times

    Cathay Pacific shares dip after passenger traffic drops in August

    Cathay Pacific shares slipped on Thursday after the airline reported a near 40 per cent slump in traffic into Hong Kong in August as tourists and business travellers avoided the disruption caused by anti-government protests in the city and as the airline faces pressure from Beijing. “August was an incredibly challenging month, both for Cathay Pacific and for Hong Kong,” Ronald Lam, the airline’s chief customer officer, said. Demand for flights to Hong Kong from mainland China were “severely hit”.

  • Benzinga

    Cathay Pacific Cargo Sector Takes Hit From Hong Kong Protests

    Hong Kong-based Cathay Pacific Airways (OTCMKTS: CPCAY), alongside its subsidiary Cathay Dragon, reported sinking air cargo numbers for August amid ongoing political unrest in its home city. Cathay Pacific hinted at tough times ahead during its most recent earnings call in early August. The call was before Hong Kong protests descended on the airport itself.

  • Reuters

    UPDATE 3-Hong Kong protesters hit pause in memory of Sept. 11

    Hong Kong activists called off protests on Wednesday in remembrance of the Sept. 11, 2001 attacks on the United States and denounced a Chinese state newspaper report that they were planning "massive terror" in the Chinese-ruled city. Hong Kong has been rocked by months of sometimes violent unrest, prompted by anger over planned legislation to allow extraditions to China, but broadening into calls for democracy and for Communist rulers in Beijing to leave the city alone. "Anti-government fanatics are planning massive terror attacks, including blowing up gas pipes, in Hong Kong on September 11," the Hong Kong edition of the China Daily said on its Facebook page, alongside a picture of the hijacked airliner attacks on the twin towers in New York.

  • Cathay Pacific's Crisis Puts Focus on Air China’s Next Move
    Bloomberg

    Cathay Pacific's Crisis Puts Focus on Air China’s Next Move

    (Bloomberg) -- Sign up for Next China, a weekly email on where the nation stands now and where it's going next.China’s crackdown on Cathay Pacific Airways Ltd. has raised questions about the government’s insider at the carrier: Air China Ltd.State-run Air China has quietly owned almost 30% of Cathay for more than a decade, giving the national flag carrier a ringside view of the Hong Kong airline’s worldwide operations. Restrictions imposed on Cathay by China’s aviation regulator last month -- after some pilots and cabin crew supported pro-democracy demonstrations in Hong Kong -- have put a spotlight on Air China’s plans for its investment, and its role within the airline.Several options are open. It could gain more clout as Cathay’s new leadership bows to Beijing, or it could cut ties with a company that has fallen out of favor with investors and drawn the Chinese government’s ire. Either way, analysts say there’s no simple, risk-free path forward.Below are some of the arguments for Air China to raise, hold or fold.Buy MoreAn Air China-Cathay Pacific merger has long been speculated on, but recent weeks have shown where the power lies. Cathay has said it will comply with all of last month’s demands from China’s aviation regulator, its chief executive and chairman have both resigned, and staff have been ordered not to take part in illegal protests.“It’s a matter of time” before China takes over Cathay completely, and it’s in Air China’s interest to own more Cathay shares, said Shukor Yusof, founder of aviation consulting firm Endau Analytics. The Civil Aviation Administration of China could squeeze Cathay until it capitulates, he said.“From Air China’s perspective, Cathay is definitely a prize they would want to get hold of,” said Paul Yong, an analyst at DBS Bank Ltd. in Singapore.But Air China would need to find a seller. Swire Pacific Ltd. owns 45% of Cathay and Qatar Airways owns about 10%, so there are few freely traded Cathay shares available.“As a long-term shareholder in Cathay Pacific for over 70 years, Swire is firmly committed to the airline,” spokesman James Tong wrote in an email. “We have full confidence in its long-term prospects.”Air China representatives didn’t reply to emails seeking comment. The South China Morning Post reported Monday that Air China non-executive director Stanley Hui said the Chinese carrier isn’t interested in a takeover and has no desire to get involved in Cathay’s day-to-day operations.From a financial perspective, Cathay shares are relatively cheap. The stock has more than halved from a 2010 high and is down around 6% since mass protests kicked off in Hong Kong in early June. Cathay rose 0.4% to HK$10.46 at 10:28 a.m. in Hong Kong on Tuesday, still below the HK$12.88-a-share that Air China paid in 2009.Status QuoAir China’s stake in Cathay sits just shy of the 30% threshold that would trigger a takeover offer. But it may not need to own more to extract benefits from the company.“There are still things Air China can learn from Cathay Pacific, especially on the premium product side,” said DBS’s Yong.Air China and Cathay, which owns 18% of Air China, have said they plan to renew until the end of 2022 a collaborative agreement covering everything from catering and ground support to code sharing and aircraft leasing. The two companies also own a cargo business in mainland China.“It would make a lot of sense” for Cathay and Air China to be part of the same group and share knowledge of each other’s markets, said Torbjorn Karlsson, a partner specializing in aviation at Korn Ferry International in Singapore. Air China doesn’t need to own Cathay, he said. “Control and ownership is less relevant than the blend of experience, skills and leadership.”The Emergency ExitDumping Cathay stock would allow Air China to cut ties with a carrier in the government’s line of fire. China’s regulator threatened to bar Cathay from mainland airspace, state-owned companies have boycotted flights, and state-backed ICBC International released an unusually bearish report on the airline last month.But an exit would deprive Air China of leverage over Cathay, and may be the least likely course of action.“Why would they do that?” said Yusof at Endau Analytics. “They have a vested interest in seeing Cathay civilized, reformed and overhauled.”(Updates with Cathay’s stock price on Tuesday in the 11th paragraph.)To contact the reporters on this story: Angus Whitley in Sydney at awhitley1@bloomberg.net;Kyunghee Park in Singapore at kpark3@bloomberg.netTo contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Will DaviesFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Air China has no plans to take over Cathay Pacific: media report
    Reuters

    Air China has no plans to take over Cathay Pacific: media report

    Air China Ltd has no plans to take over Hong Kong's Cathay Pacific Airways Ltd , an independent director of the state-owned Chinese carrier told the South China Morning Post newspaper. "Based on what I know, I wouldn't think that is anywhere on the agenda, no way," Air China non-executive director Stanley Hui told the newspaper when asked if the carrier, a 30% shareholder, might seek to buy Cathay outright. The Hong Kong airline has become the biggest corporate casualty of anti-government protests after China demanded it suspend staff involved in, or who support, demonstrations that have plunged the former British colony into a political crisis.

  • Cathay Pacific Chairman Resigns Weeks After CEO Steps Down
    Bloomberg

    Cathay Pacific Chairman Resigns Weeks After CEO Steps Down

    (Bloomberg) -- Merlin Swire, the scion of the U.K. family that controls Cathay Pacific Airways Ltd., is running out of concessions to offer after his employees angered China by joining the anti-Beijing protests in Hong Kong.Less than a month ago, China’s civil aviation authority began clamping down on Hong Kong’s flag carrier, prompting Swire to swiftly fly to Beijing to try to smooth things over with officials. Since then, Cathay has fired staff and threatened to terminate workers for even supporting the demonstrations -- let alone participate in them. The airline’s chief executive officer quit and on Wednesday, Chairman John Slosar announced his resignation.Swire’s response to the crisis illustrates the lengths companies will go to avoid falling afoul of the Chinese government. The cautionary tale, involving an airline whose business would be crippled if it lost access to China, has prompted multinational companies such as KPMG and PwC to take steps to avoid giving the appearance of siding against the mainland.“They’re using Cathay as an example on how far they can go, how far economically and financially strangle you,” said Shukor Yusof, founder of aviation consultant Endau Analytics. “I don’t know whether China will see this as far enough.”Cathay stock fell as much as 3.9%, before trading down 2.6% at HK$10.42 at 1 p.m. in Hong Kong. That trimmed the airline’s market value to HK$41 billion ($5.2 billion).Slosar, 63, will be replaced by Patrick Healy, a 31-year veteran of Cathay’s parent Swire Group who has spent years in China.Cathay’s troubles began emerging after employees took part in a general strike last month that caused a shutdown of Hong Kong’s airport, canceling hundreds of flights from the carrier’s hub. Chinese authorities soon threatened to ban Cathay flights from flying into mainland airspace and imposed a swathe of demands. Then some Chinese state-owned firms boycotted the airline.Cathay and Swire have since cracked down on employees, warning workers multiple times not to participate in or support any illegal protests.Though it’s unclear how big the financial toll will be, the airline has warned that it expects “significant impact” on its revenue from August and beyond as the protests weigh on travel demand. Both business and leisure travel into Hong Kong has “weakened substantially” and traffic from the city has started to soften, especially on short-haul routes to China and South Korea, Cathay has said.‘Company in Crisis’Zhao Dongchen, the analyst at state-backed ICBC International who last month issued his inaugural report on Cathay with a “strong sell,” said the resignations may not be enough to turn around the carrier.“Management changes are generally good for a company in crisis,” he said in response to Bloomberg queries. “But I think Cathay still has a lot to do to turn its current negative public perception.“Slosar, also a Swire veteran, ran Cathay as CEO from 2011 before becoming its chairman in 2014. As CEO, he faced challenges including intensifying competition, rising fuel costs and union demands -- yet succeeded in keeping profitability and maintaining revenue growth.‘They’re All Adults’As chairman when the demonstrations in Hong Kong intensified, Slosar seemed reluctant to rein in Cathay’s workforce.“We certainly wouldn’t dream of telling them what they have to think about something,” Slosar said at an earnings briefing on Aug. 7, days after Cathay pilot and flight-crew unions took part in a general strike coordinated by protesters. “They’re all adults, they’re all service professionals. We respect them greatly.”Slosar’s replacement, 53-year-old Healy, has worked his way up at Swire’s various businesses in Hong Kong, China and Germany, and is currently heading Swire’s Coca-Cola operations. He graduated from St. John’s College, Cambridge University, in July 1988 with a Bachelor’s degree in modern languages.Healy and the new CEO, Augustus Tang, now have a delicate task of continuing to placate China, an increasingly important market for the seven-decade-old airline. The new leaders also need to minimize the fallout from staff, customers and investors as the unrest in its home base continues to simmer.After former CEO Rupert Hogg‘s departure, the Global Times, a newspaper published by China’s Communist Party, said the resignation may not be enough to atone for Cathay’s “lukewarm attitude” to dealing with its “radical” employees. Pilots and flight attendants from the airline took part in strikes and demonstrations related to the protest, which has morphed from opposing an extradition bill into a mass repudiation of China’s hold over the territory it took back in 1997.There are signs that investors are betting Cathay will be able to soothe Beijing. After tumbling to a decade low last month in the depths of the crisis, the shares have since rebounded as the fourth-best-performer among 64 listed global airlines tracked by Bloomberg.\--With assistance from Evelyn Yu and Angus Whitley.To contact the reporter on this story: Kyunghee Park in Singapore at kpark3@bloomberg.netTo contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Ville HeiskanenFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Cathay shares fall nearly 4% after chairman resigns
    Reuters

    Cathay shares fall nearly 4% after chairman resigns

    Shares in Cathay Pacific Airways Ltd fell nearly 4% in early trade on Thursday following the resignation of its chairman after the market closed on the previous day. The departure of John Slosar was announced less than three weeks after mounting Chinese regulatory scrutiny led to the shock exit of its chief executive, Rupert Hogg. Cathay shares had closed 7.2% higher on Wednesday as the Hong Kong market was lifted by reports of the withdrawal of a controversial extradition bill, which was officially announced after the market closed.

  • Financial Times

    Cathay Pacific chairman John Slosar quits after Beijing crackdown

    Cathay Pacific’s chairman John Slosar resigned on Wednesday as he became the latest casualty at the Hong Kong flag carrier after Beijing’s crackdown following anti-government protests in the territory. a controversial extradition bill that sparked the worst political crisis in Hong Kong since the territory was handed back from the UK to China more than 20 years ago. Cathay has been the biggest corporate casualty of the three month-long political crisis sweeping Hong Kong after Beijing demanded the airline suspend staff who were involved in, or supportive of, the protests.

  • Cathay Chairman Slosar resigns weeks after CEO left, deepening reshuffle
    Reuters

    Cathay Chairman Slosar resigns weeks after CEO left, deepening reshuffle

    Hong Kong's Cathay Pacific Airways shook up its top ranks further as Chairman John Slosar resigned on Wednesday, less than three weeks after mounting Chinese regulatory scrutiny led to the shock departure of its chief executive. The airline has become the biggest corporate casualty of anti-government protests after China demanded it suspend staff involved in, or who support, demonstrations that have plunged the former British colony into a political crisis. Slosar, 63, will be replaced by Patrick Healy, a long-time executive at the airline's top shareholder and manager Swire Pacific Ltd , Cathay announced.

  • Reuters

    UPDATE 12-Hong Kong leader pulls extradition bill, but too little too late, say some

    Hong Kong leader Carrie Lam on Wednesday withdrew an extradition bill that triggered months of often violent protests so the Chinese-ruled city can move forward from a "highly vulnerable and dangerous" place and find solutions. The withdrawal needs the approval of the Legislative Council, which is not expected to oppose Lam. The bill would have allowed extraditions to mainland China where courts are controlled by the Communist Party.

  • Reuters

    REFILE-UPDATE 1-Hong Kong's Cathay Pacific warns against protest outside its premises

    Hong Kong carrier Cathay Pacific Airways warned against what it described as an illegal protest planned outside its offices on Wednesday and that it had zero tolerance for "violent activities" and any staff who took part. Cathay has been caught in the crosswinds between authorities in Beijing and anti-government protesters who have staged sometimes violent demonstrations since June that have grown to pose the city's biggest challenge since it returned to Chinese rule in 1997.

  • Hong Kong protesters denounce Cathay Pacific for firing cabin crew
    Reuters

    Hong Kong protesters denounce Cathay Pacific for firing cabin crew

    Hundreds of people protested in Hong Kong on Wednesday to denounce Cathay Pacific Airways for dismissing crew taking part in or supporting anti-government rallies that have swept the Chinese-ruled city for weeks. The Hong Kong Confederation of Trade Unions (HKCTU) switched the protest venue, originally planned to be outside the airline's airport headquarters, Cathay City, to the central financial district after police refused permission. Cathay was targeted for sacking 20 pilots and cabin crew and what staff have described as "white terror", a phrase used to describe anonymous acts that create a climate of fear.

  • Qatar Airways has full confidence in Cathay Pacific, eyes bigger stake
    Reuters

    Qatar Airways has full confidence in Cathay Pacific, eyes bigger stake

    Qatar Airways has full confidence in Cathay Pacific Airways Ltd and will increase its 10% stake in the Hong Kong carrier if it has any opportunity to do so, the Qatari airline's chief executive said on Tuesday. Cathay has become the biggest corporate casualty of political unrest in Hong Kong after China demanded it suspend staff involved in, or who support, anti-government demonstrations. "Cathay Pacific is there to stay, and to expand and to serve the people of both Hong Kong and China, as Hong Kong is an integral part of mainland China," Qatar Airways' Chief Executive Akbar al-Baker said.

  • Reuters

    UPDATE 2-Hong Kong government warns of great danger after weekend of violence

    Illegal violence is pushing Hong Kong to the brink of great danger, the city government said on Monday, after a weekend of clashes that included the first gun-shot and the arrest of 86 people, the youngest just 12. Police fired water cannon and volleys of tear gas in running battles with protesters who threw bricks and petrol bombs on Sunday, the second day of weekend clashes in the Chinese-ruled city. "The escalating illegal and violent acts of radical protesters are not only outrageous, they also push Hong Kong to the verge of a very dangerous situation," the government said in a statement.

  • Water Cannons, Tear Gas and Drawn Weapons: Hong Kong Update
    Bloomberg

    Water Cannons, Tear Gas and Drawn Weapons: Hong Kong Update

    (Bloomberg) -- Hong Kong police deployed water cannons for the first time, fired multiple volleys of tear gas and at least two officers drew weapons in running skirmishes with protesters in the 12th weekend of unrest in the Asian financial center.Police and protesters were involved in several standoffs in the western New Territories district of Tsuen Wan on Sunday afternoon. On Saturday, Hong Kong Chief Executive Carrie Lam held a meeting with former officials and other prominent people to find a way out of the impasse that has rocked the former British colony.The return to violence followed large but peaceful protests last weekend. On Friday, protesters formed a human chain across the city, while a plan to disrupt airport transportation services on Saturday wasn’t successful. Historic mass marches opposing legislation easing extraditions to China began peacefully in June, and have since widened into a broader movement against Beijing’s increasing grip.Key Developments:Police deployed water cannons, fired tear gas and some drew weapons on Sunday as protests turned violent in the Tsuen Wan district.Police arrested more than two dozen protesters on SaturdayChief Executive Lam seeks to build a dialogue platform to address roots of discontentU.K. consulate staffer Simon Cheng was released by China on Saturday after more than two weeks of detentionHere’s the latest:Weapons drawn (8.30 p.m.)At least two police officers drew weapons after they had come come under attack from protesters. Police said a weapon was fired, according to Now TV and TVB, without providing further details. Running battles continued into Sunday night in Tsuen Wan after a march in the area. By 8.30 p.m., most of the streets in the district appeared to have been cleared by police.Some protesters regathered in the Sham Shui Po area, where they faced off with police in a tense standoff.Water canons on the streets (7.30 p.m.)Police used water cannons to clear barricades set up by protesters in Tsuen Wan, after firing multiple rounds of tear gas to try to disperse demonstrators who had occupied roads. Running battles continued There were no protesters present at the time the water cannons were used, the South China Morning Post reported on its website.With train stations in the area closed down, remaining protestersRain march (Sunday 2 p.m.)People took cover from the persistent rain and filled the stands and pitch of the Kwai Chung sports stadium, the starting point for Sunday’s rally. The march from the stadium was granted late-night approval after organizers appealed an earlier objection by authorities.“The rainy weather is good for the protesters but it’s bad for the police, who are wearing heavy gear. It also makes their tear gas ineffective,” said Gloria Mak, a 25-year-old assistant to a Japanese company.Train service suspended (Sunday 11.30 a.m.)MTR Corp., operator of Hong Kong’s rail network, suspended train service to stations near the planned Tsuen Wan march. The company said in a statement that the Kwai Fong, Tsuen Wan and Tai Wo Hau stations would be closed from 1.30 p.m. until further notice.On Saturday, MTR suspended service on parts of its Kwun Tong line because of protests in the area.Operations Director Adi Lau Tin-shing said the current situation was the company’s biggest challenge in its 40 years of operation and that the station closures were an unavoidable decision taken on the grounds of safety.Police condemn ‘radical’ behavior (Sunday, 3:02 a.m.)Police said “radical protesters” in Saturday’s clashes used electric saws to damage a number of smart lampposts, and hurled hard objects, bricks and petrol bombs at officers. They arrested 19 men and 10 women, aged between 17 and 52, for offenses including the possession of offensive weapons and assaulting police officers, the police said in a statement.Bricks and bamboo poles (Saturday 4:20 p.m.)Police fired tear gas to break up demonstrators blocking a road in the Kwung Tong area. Protesters were seen breaking bricks into smaller pieces and using bamboo poles to keep police from getting close to a barricade they erected. Elsewhere, video footage showed a so-called smart lamppost that was toppled and notes declaring “no totalitarian surveillance” were pasted on it.Protesters split up from the authorized march route and some regathered in the neighborhood of Wong Tai Sin, the scene of clashes earlier this month. Police fired tear gas and made arrests after the demonstrators blocked off roads and disrupted traffic.Lam seeks dialogue platform (Saturday 3:10 p.m.)About 30 people were invited to the meeting organized by Lam in Government House, including ex-transport chief Anthony Cheung and Cardinal John Tong, the former bishop of Hong Kong, RTHK reported. Lam said the meeting was not a “dialogue platform” but a gathering to share ideas on how to build dialogue.“I do not expect dialogue to easily resolve the deadlock, stop demonstrations, or to provide solutions to problems,” she said in a Facebook post. “But continuing to fight is not the way out.”Cathay issues warning (3.30 p.m.)Cathay Pacific Airways Ltd. said it will not tolerate employees supporting or taking part in illegal protests ahead of “planned activities” by the Hong Kong Confederation of Trade Unions on Aug. 26.The Airport Authority Hong Kong obtained a High Court order to extend an interim injunction granted on Aug. 13 banning protesters from unlawfully obstructing access to the airport. That injunction covers Cathay City, “which is the operational hub for our global operations and as such includes facilities that are absolutely critical to our flight operations,” Cathay said in Saturday’s statement.Operations at the city’s airport were disrupted earlier this month when protesters occupied the building.U.K. Consulate Staffer Freed (10:39 a.m.)Chinese police released a U.K. consulate staffer from Hong Kong after more than two weeks in detention. Simon Cheng was set free on Saturday after he was held for violating the Public Security Administration Punishment Law, police in the southern Chinese city of Shenzhen said in a post on the Weibo social media platform. He failed to return home to Hong Kong from an Aug. 8 meeting in Shenzhen.Upcoming ScheduleThe weekend concludes with Sunday protests in the Tsuen Wan and Kwai Chung areas, starting mid-afternoon. Relatives of police also plan a march to the official residence of Chief Executive Lam in support of local law enforcement\--With assistance from Justin Chin, Sheryl Tian Tong Lee and Venus Feng.To contact the reporters on this story: Kari Lindberg in Hong Kong at klindberg13@bloomberg.net;Annie Lee in Hong Kong at olee42@bloomberg.net;Aaron Mc Nicholas in Hong Kong at amcnicholas2@bloomberg.net;Natalie Lung in Hong Kong at flung6@bloomberg.netTo contact the editors responsible for this story: Shamim Adam at sadam2@bloomberg.net, ;Brendan Scott at bscott66@bloomberg.net, Stanley James, Andrew JanesFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Reuters

    WRAPUP 5-Hong Kong protests met with tear gas; China frees UK mission staffer

    Hong Kong police fired volleys of tear gas to break up anti-government protests in a gritty industrial suburb on Saturday after activists threw petrol bombs and bricks, as China freed a British consulate worker whose detention had fuelled tensions. Four MTR subway stations were closed around Kwun Tong, a densely populated area of the Chinese-ruled city on the east of the Kowloon peninsula, but thousands packed the streets anyway, most carrying umbrellas against the sun.

  • Analyst Who Cut Cathay to Sell Says He Faces Huge Pressure
    Bloomberg

    Analyst Who Cut Cathay to Sell Says He Faces Huge Pressure

    (Bloomberg) -- The analyst who issued a report warning investors to dump shares of embattled Cathay Pacific Airways Ltd. before they tumble to their lowest levels since 1998, is getting a lot of blowback after his controversial call.“Never before in my 12 years of investment analyst career have I received this much pressure on a particular stock rating,” Zhao Dongchen, who last week issued his inaugural report on Cathay with a “strong sell,” said in an emailed response to Bloomberg queries. “Never before in my 36 years of life am I under such heavy pressure.”Zhao, who’s head of equity research at the investment-banking arm of state-run giant Industrial & Commercial Bank of China Ltd., issued his report as Cathay was under fire from China and facing boycotts from government-run businesses because the carrier’s employees joined the anti-Beijing protests in Hong Kong. No other analyst is advising investors to sell Cathay and Zhao’s HK$6 target price is more than 40% below the stock’s current price.“We have one of China’s biggest state banks issuing an especially bearish and unusual sell recommendation on a private company in H.K. that is already the target of the Chinese state,” said George Magnus, a former UBS Group AG chief economist and author of “Red Flags: Why Xi’s China Is in Jeopardy.” “You don’t have to try hard to conclude that the interests of Chinese state banking institutions and the government are closely aligned.”Since Zhao’s report, which preceded the abrupt resignation of Cathay’s chief executive officer, shares of Hong Kong’s flag carrier have rebounded 4.7%, making them the sixth-best-performer among 64 listed global airlines tracked by Bloomberg.The shares closed 1.4% lower at HK$10.26 in Hong Kong on Friday, marking its fourth straight day of declines.Meanwhile, Zhao has been facing pressure to cancel or delay interviews, change his rating or target price, and refrain from issuing research updates on Cathay since his Aug. 13 report, he said. “A lot of people” tried to persuade him to “go easy” on the company, Zhao said.Still, nobody influenced the report or its timing, and he stands by the call, Zhao said. He said that his research was independent and that people shouldn’t unfairly single out Chinese banks for having state ties because so do lenders in places like the U.K. and Singapore.In his report, entitled “Less Deserved to Fly,” Zhao criticized the Hong Kong carrier for potentially causing “irreversible damage” to the company’s brand because of “poor crisis management” in relation to the protests. The report said that a large-scale management reshuffle would be an “upside risk” for the company.“My strong sell rating is based on the difference between Cathay’s stock price and our target price,” he said. “Simple as that.” He said he won’t shy away from a “shock rating” as he believes contrarian reports to be more helpful to investors.Zhao said Cathay currently trades at a premium to other airlines in Asia, which he believes will “evaporate” because of factors ranging from the unrest in Hong Kong to the effects of the U.S.-China trade war on global commerce.Also, the airline’s management team has shown a “severe lack of composure” in dealing with crises, including a recent data breach and problems with the Chinese regulator, Zhao said.So what’s Zhao’s advice for Cathay now?“Be a better company,” he said.Cathay Pacific declined to comment.Zhao, who typically focuses on raw materials research, runs a team of 21 equity analysts covering 8 sectors at Hong Kong-based ICBC International.Zhao’s primary expertise lies away from airlines, with the analyst voted number one for China energy research by Institutional Investor this year, according to ICBC. He started covering Cathay for ICBC International only in March, though he said he has kept a close watch on industries such as transportation.In 2006, when he first started out in a mutual fund, Zhao said he covered airlines for about three months. “To me, the airlines sector has never been a stranger,” he said.Yet Zhao stands alone among his peers in his bearish view of Cathay. Of the 19 analysts tracked by Bloomberg, 13 have the equivalent of a buy rating and 5 have holds.“Strong sell is the wrong rating on the stock at the moment,” said Mark Webb, an analyst at GMT Research in London who previously covered the stock for 18 years at HSBC Holdings Plc. “Only a significant deterioration in the situation in Hong Kong would make it go significantly lower from here.”Asked why Zhao appears to only assign his harshest ratings to foreign companies such as Rio Tinto Plc, Vale SA and BHP Group Ltd, while only giving buy ratings for Chinese companies such as Shandong Gold Mining Co., Zhao said:“I did just issue a strong sell rating on Cathay Pacific, didn’t I? That’s a Hong Kong-incorporated company, not a foreign one.”(Updates Cathay share prices in fifth, sixth paragraphs)To contact Bloomberg News staff for this story: Evelyn Yu in Shanghai at yyu263@bloomberg.net;Gregor Stuart Hunter in Hong Kong at ghunter21@bloomberg.netTo contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, ;Christopher Anstey at canstey@bloomberg.net, Christopher JasperFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.