Lockdown halts China iPhone assembly
The Hang Seng Tech index of large Chinese tech groups fell a record 11 per cent on Monday, after closing at its lowest ever level on Friday. Tougher regulation at home and abroad caused last week’s declines, which have now been extended by a renewed Covid threat.
The tech hub of Shenzhen is one of a number of cities that have been locked down, as China battles its biggest Covid surge since the start of the pandemic.
Apple supplier Foxconn and dozens of other factories in Shenzhen have stopped production. The lockdown is scheduled to last for six days and could compound disruptions to global supply chains that have contributed to rising inflation in the US and Europe.
More than 30 Taiwanese companies, making everything from circuit boards to touchscreen modules, announced production stoppages at their factories in the city.
Foxconn said it had adjusted production at other plants to “minimise the potential impact”, but its two Shenzhen plants are big production hubs for Apple’s iPhones and workers said they had been assembling the latest iPhone 13.
Overall on Monday, Chinese stocks in Hong Kong fell the most since the global financial crisis — the Hang Seng China Enterprises index of mainland Chinese stocks closed more than 7 per cent lower, its largest one-day fall since November 2008.
The Internet of (Five) Things
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Shares in Paytm fell more than 13 per cent on Monday after India’s central bank barred a division of the payment group from signing up new customers. The SoftBank-backed tech company has endured a difficult period as a public company as investors worry about profitability. The Reserve Bank of India demanded that an IT audit firm be appointed for its associate bank “to conduct a comprehensive System Audit of its IT system”.
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San Francisco, Seattle, Austin and New York are becoming stronger as tech hubs, according to new research from the Brookings Institution. While there are a few burgeoning sunbelt spots where tech companies are putting jobs and money — places like Miami, St Louis, Dallas, and Denver — the “rise of the rest” has yet to really take off.
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Tech tools — Vuitton’s Spin Time Air Quantum
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