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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Good morning. A ransomware attack on China’s largest bank has disrupted the US Treasury market by forcing clients of the Industrial and Commercial Bank of China to reroute trades, market participants said yesterday.
The Securities Industry and Financial Markets Association told members that ICBC had been hit by ransomware software, which paralyses computer systems unless a payment is made, according to several people familiar with the discussions.
Traders and banks said the attack prevented ICBC from settling Treasury trades on behalf of other market participants.
ICBC was starting to restore services as of Thursday afternoon, according to some of the people briefed on the incident. It was, however, “extremely unusual for a bank of their size to be impacted like this”, said Allan Liska, threat intelligence analyst at Recorded Future.
It’s the latest incident of a major ransomware attack, which have proliferated since the pandemic. Earlier on Thursday, “magic circle” law firm Allen & Overy was also hit by hackers. Get the latest on this developing story.
Here’s what else I’m keeping tabs on today and over the weekend:
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US-China relations: US Treasury secretary Janet Yellen and Chinese vice-premier He Lifeng meet for a second day in San Francisco ahead of a summit between Joe Biden and Xi Jinping.
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Economic data: The UK reports preliminary third-quarter GDP figures.
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Singles’ Day in China: Chinese consumers faced with economic headwinds are likely to cut back spending when the world’s biggest annual shopping event begins Saturday. (CNN)
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Five more top stories
1. Nvidia has developed three new chips tailored for China that aim to meet the region’s growing demand for artificial intelligence technology while avoiding US export restrictions. The performance of the technology has been moderated compared with those that Nvidia had previously sold in China. Nonetheless, the new chips are expected to remain competitive in the Chinese market.
2. The US and Israeli spy chiefs held talks on a potential three-day humanitarian pause that would allow as many as 20 hostages to be released by Hamas and more aid to enter the besieged Gaza Strip. The meeting took place in Qatar, which is liaising with Hamas, the Palestinian militant group at war with Israel. The White House said Israel had agreed to shorter four-hour humanitarian pauses each day in the fighting.
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More news: Israel has called for a group of freelance Palestinian photographers who transmitted images of the October 7 Hamas raid to international media should be treated as terrorists, claiming they had prior knowledge of the attack
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How Israel’s spymasters misread Hamas: Overconfident intelligence agencies missed multiple warnings before the October 7 attacks in a “failure of imagination”.
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‘We can’t go south’: Hundreds of thousands of increasingly desperate Palestinians have remained north of the evacuation line amid dire conditions.
3. SoftBank Group posted an unexpected ¥931bn ($6.2bn) net loss in its second quarter. It was the fourth consecutive quarter in the red for the Japanese conglomerate, compounding the pain for shareholders and founder Masayoshi Son after one of the group’s biggest bets, WeWork, filed for bankruptcy this week. Read the details of SoftBank’s disappointing quarter.
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More companies news: Apple has been dealt a blow in its €14.3bn tax dispute with Brussels after an adviser to the EU’s top court said an earlier ruling over its business in Ireland should be shelved.
4. The Bank of Japan will proceed carefully with raising interest rates to avoid bond market volatility and any adverse impact on financial institutions, governor Kazuo Ueda told the FT Global Boardroom conference yesterday. But he said it was “too early” to determine the sequence of its policy normalisation.
5. Homemaking entrepreneur Martha Stewart has praised India’s capability as a textile manufacturing hub and contrasted it with the difficulty of producing goods in China. Speaking to the FT, Stewart also alluded to trade tensions between Washington and Beijing as one of the factors encouraging companies to shift sourcing away from China.
How well did you keep up with the news this week? Take our quiz.
The Big Read
Steering North Korea through a period of extreme isolation to counter Covid-19 while defying tough international sanctions, Kim Jong Un has emerged into the warm embrace of Moscow and Beijing amid intensifying geopolitical tensions in the region. The millennial dictator has strengthened ties with Russian president Vladimir Putin and continued to develop nuclear weapons, illustrating how global chaos has benefited his country.
We’re also reading . . .
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Sino-Russian Arctic ambitions: Moscow has long asserted pre-eminence in the region, while Beijing has commercial and military plans of its own there, writes Kristina Spohr.
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Algorithmic bias: Sarah Meredith was in urgent need of a liver when she found out an algorithm would be making the life-or-death decision.
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WeWork’s bankruptcy: The desk-renting start-up’s implosion ought to teach investors not to bet the future on the recent past, writes Gillian Tett.
Chart of the day
As much of the world battles rising prices, China’s economy edged back into deflation last month. The consumer price index fell 0.2 per cent year on year in October, dragged down by falling prices of pork, China’s staple meat.
Take a break from the news
Afghanistan has emerged as the underdog success story of the cricket World Cup in India, with historic victories that have brought cheer to the crisis-hit nation. The men’s team, a newcomer to high-level cricket, plays South Africa in Ahmedabad today with a slim chance of qualifying for the semi-finals for the first time.
Additional contributions from Tee Zhuo and Gordon Smith
