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China suspends UK stock exchange link

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China has temporarily blocked planned cross-border listings between the Shanghai and London stock exchanges because of political tensions with the United Kingdom, five sources told the Reuters news agency.

Suspending the Shanghai-London Stock Connect scheme casts a shadow over the future of a project meant to build ties between the UK and China, help Chinese firms expand their investor base and give mainland investors access to UK-listed companies.

The sources, who include public officials and people working on potential Shanghai-London deals, cited politics as the reason behind the suspension.

Two of them highlighted the UK’s stance over the Hong Kong protests and one pointed to remarks over the detention of a now-former staff member at its consulate in Hong Kong.

All five sources have been involved in talks with Chinese officials and spoke to Reuters on condition of anonymity because they are not authorised to speak about the matter publicly.

British companies and banks involved in the scheme are watching closely how recently-elected Prime Minister Boris Johnson approaches relations with Beijing and what stance he takes on Hong Kong, which has been roiled by protests.

China blames the Hong Kong unrest, heavily supported by an anti-government movement seeking to curb controls by Beijing, on interference by foreign governments including the United States and the UK.

The China Securities Regulatory Commission and the Shanghai Stock Exchange did not respond to requests for comment. A spokesperson for the London Stock Exchange and a spokeswoman for the UK’s finance ministry declined to comment.

China’s Ministry of Foreign Affairs said in a faxed statement that it was not aware of the specifics, but added that it “hopes the UK can provide a fair and unbiased business environment for Chinese companies that invest in the UK and create the appropriate conditions for both countries to carry out practical cooperation smoothly in various fields”.

Stock Connect, which began operating last year, was devised as a way of improving the UK’s relationship with the world’s second-biggest economy and was seen as a significant step by China to open up its capital markets as well as linking them globally.

China chill

Huatai Securities was the first Chinese company to use the scheme in May, with SDIC Power set to become the second in December with a listing of financial instruments known as global depository receipts (GDRs) in London representing 10 percent of its share capital.

However, the alternative energy operator’s deal was postponed at an advanced stage, with SDIC Power citing market conditions as the main reason.

Five sources told Reuters, SDIC Power’s deal was halted because of Beijing’s suspension of Stock Connect.

GDRs are certificates issued by financial institutions that allow a company’s shares to be traded on an overseas exchange.

Other hopefuls such as China Pacific Insurance, which one of the sources said could have launched a deal as early as the first quarter of 2020, have also been told to put their cross-border listing plans on ice, they added.

SDIC Power and China Pacific Insurance did not respond to requests for comment, Reuters reported.

“It’s not only a big blow to the companies looking to broaden the investor base via listings in London, but also to China’s links with global markets,” one source, who has worked on one of the GDR deals, told Reuters.

The trouble with the scheme comes at a bad time for the UK, which is eager to build ties with non-European Union countries as it prepares to leave the bloc.

The London exchange was set for its worst year in terms of new listings in 10 years as of December 4, Refinitiv data showed, with political volatility and concerns over the UK’s EU divorce crimping stock market fundraising.

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Reuters news agency

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NDP beat Conservatives in federal byelection in Winnipeg

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WINNIPEG – The federal New Democrats have kept a longtime stronghold in the Elmwood-Transcona riding in Winnipeg.

The NDP’s Leila Dance won a close battle over Conservative candidate Colin Reynolds, and says the community has spoken in favour of priorities such as health care and the cost of living.

Elmwood-Transcona has elected a New Democrat in every election except one since the riding was formed in 1988.

The seat became open after three-term member of Parliament Daniel Blaikie resigned in March to take a job with the Manitoba government.

A political analyst the NDP is likely relieved to have kept the seat in what has been one of their strongest urban areas.

Christopher Adams, an adjunct professor of political studies at the University of Manitoba, says NDP Leader Jagmeet Singh worked hard to keep the seat in a tight race.

“He made a number of visits to Winnipeg, so if they had lost this riding it would have been disastrous for the NDP,” Adams said.

The strong Conservative showing should put wind in that party’s sails, Adams added, as their percentage of the popular vote in Elmwood-Transcona jumped sharply from the 2021 election.

“Even though the Conservatives lost this (byelection), they should walk away from it feeling pretty good.”

Dance told reporters Monday night she wants to focus on issues such as the cost of living while working in Ottawa.

“We used to be able to buy a cart of groceries for a hundred dollars and now it’s two small bags. That is something that will affect everyone in this riding,” Dance said.

Liberal candidate Ian MacIntyre placed a distant third,

This report by The Canadian Press was first published Sept. 16, 2024

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Trudeau says ‘all sorts of reflections’ for Liberals after loss of second stronghold

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OTTAWA – Prime Minister Justin Trudeau say the Liberals have “all sorts of reflections” to make after losing a second stronghold in a byelection in Montreal Monday night.

His comments come as the Liberal cabinet gathers for its first regularly scheduled meeting of the fall sitting of Parliament, which began Monday.

Trudeau’s Liberals were hopeful they could retain the Montreal riding of LaSalle—Émard—Verdun, but those hopes were dashed after the Bloc Québécois won it in an extremely tight three-way race with the NDP.

Louis-Philippe Sauvé, an administrator at the Institute for Research in Contemporary Economics, beat Liberal candidate Laura Palestini by less than 250 votes. The NDP finished about 600 votes back of the winner.

It is the second time in three months that Trudeau’s party lost a stronghold in a byelection. In June, the Conservatives defeated the Liberals narrowly in Toronto-St. Paul’s.

The Liberals won every seat in Toronto and almost every seat on the Island of Montreal in the last election, and losing a seat in both places has laid bare just how low the party has fallen in the polls.

“Obviously, it would have been nicer to be able to win and hold (the Montreal riding), but there’s more work to do and we’re going to stay focused on doing it,” Trudeau told reporters ahead of this morning’s cabinet meeting.

When asked what went wrong for his party, Trudeau responded “I think there’s all sorts of reflections to take on that.”

In French, he would not say if this result puts his leadership in question, instead saying his team has lots of work to do.

Bloc leader Yves-François Blanchet will hold a press conference this morning, but has already said the results are significant for his party.

“The victory is historic and all of Quebec will speak with a stronger voice in Ottawa,” Blanchet wrote on X, shortly after the winner was declared.

NDP Leader Jagmeet Singh and his party had hoped to ride to a win in Montreal on the popularity of their candidate, city councillor Craig Sauvé, and use it to further their goal of replacing the Liberals as the chief alternative to the Conservatives.

The NDP did hold on to a seat in Winnipeg in a tight race with the Conservatives, but the results in Elmwood-Transcona Monday were far tighter than in the last several elections. NDP candidate Leila Dance defeated Conservative Colin Reynolds by about 1,200 votes.

Singh called it a “big victory.”

“Our movement is growing — and we’re going to keep working for Canadians and building that movement to stop Conservative cuts before they start,” he said on social media.

“Big corporations have had their governments. It’s the people’s time.”

New Democrats recently pulled out of their political pact with the government in a bid to distance themselves from the Liberals, making the prospects of a snap election far more likely.

Trudeau attempted to calm his caucus at their fall retreat in Nanaimo, B.C, last week, and brought former Bank of Canada governor Mark Carney on as an economic adviser in a bid to shore up some credibility with voters.

The latest byelection loss will put more pressure on him as leader, with many polls suggesting voter anger is more directed at Trudeau himself than at Liberal policies.

This report by The Canadian Press was first published Sept. 17, 2024.

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NDP declares victory in federal Winnipeg byelection, Conservatives concede

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The New Democrats have declared a federal byelection victory in their Winnipeg stronghold riding of Elmwood—Transcona.

The NDP candidate Leila Dance told supporters in a tearful speech that even though the final results weren’t in, she expected she would see them in Ottawa.

With several polls still to be counted, Conservative candidate Colin Reynolds conceded defeat and told his volunteers that they should be proud of what the Conservatives accomplished in the campaign.

Political watchers had a keen eye on the results to see if the Tories could sway traditionally NDP voters on issues related to labour and affordability.

Meanwhile in the byelection race in the Montreal riding of LaSalle—Émard—Verdun the NDP, Liberals and Bloc Québécois remained locked in an extremely tight three-way race as the results trickled in slowly.

The Liberal stronghold riding had a record 91 names on the ballot, and the results aren’t expected until the early hours of the morning.

This report by The Canadian Press was first published Sept. 16, 2024.

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