Top stories for the morning: Sony Financial's IPO soars, SEC head on canceling quarterly reports

Sony has successfully spun off its finance business, setting an example of restructuring large Japanese conglomerates. Shares of the spun-off company jumped by more than a third. Alibaba emerged as a growth leader in Hong Kong thanks to its bet on cloud services and partnership with Nvidia. Chinese automaker BYD lowered its sales forecasts but is betting on expansion outside mainland China. The head of the U.S. regulator promised to accelerate the abandonment of quarterly business reports. About these and other topics - in our review of key events for the morning of September 29.

Shares of Sony Financial Group jumped 37% on the first day of trading on the Tokyo Stock Exchange after the spin-off from Sony Group, which will now be able to focus on entertainment and image sensors, Bloomberg reports. The new company's papers started at 205 Japanese yen with a reference price of 150 Japanese yen, giving it a capitalization of about 1 trillion yen (about $6.7 billion). This is the first direct listing in Japan in more than two decades, the agency points out.

Richard Howe, founder of research firm Stock Spin-off Investing, called the separation of Sony's business a logical step: insurance and banks are easier to value separately from movies, music, games and semiconductors. The deal also demonstrates an example of corporate restructuring in Japan - the authorities and the stock exchange are actively incentivizing such moves with tax breaks, Bloomberg notes.

Shares of Alibaba Group Holding became the growth leader among Chinese tech giants in Hong Kong, adding almost 50% in a month, Bloomberg writes. On Monday, the securities rose another 4.1%, the best result since the company listed in 2019. Analysts attribute the rally to its improving prospects in the cloud and AI business.

Morningstar raised its fair price target on Alibaba's securities by nearly 50% to $267 per depositary receipt and HK$260 per share, citing its success in developing international data centers, proprietary chips and open source AI models. Morgan Stanley also raised its target to $200 and forecast Alibaba's cloud revenue growth of 32% in 2026 and 40% in 2027 - driven by increased investment, partnership with Nvidia and overseas expansion.

The S&P 500 index is trading near record levels and its multiples are being compared to the dot-com days, Yahoo Finance writes. However, some strategists believe that high valuations should be perceived as the new normal. For example, Bank of America noted that accelerated adoption of AI and steady growth in corporate profits are changing the perception of "fair" levels. CFRA Research believes that when compared to the last five years, rather than long-term history, the market premium does not look so extreme.

Fears of market overheating are reminiscent of Alan Greenspan's warnings of "irrational exuberance" in 1996, but then stocks were growing for several more years, the publication notes. Today, strategists point out that the income of companies keep up with the growth of quotations: technology and communications sectors form 44% of the capitalization of the S & P 500 and already 37% of the index profit. Meanwhile, record amounts of investor cash, strong GDP growth and consumer demand are supporting the market.

US Securities and Exchange Commission (SEC) Chairman Paul Atkins has promised to accelerate the elimination of quarterly reporting for public companies, he wrote in a column for the Financial Times. He noted that he intends to pursue a policy of minimal regulation and accelerate President Donald Trump's initiative to abandon the publication of financial results on a quarterly basis.

"Government should provide the minimum necessary dose of regulation that protects investors but still allows businesses to grow," Atkins urged.

The regulator now requires public companies to file financial reports every 90 days. Atkins did not give a specific timeline for possible changes.

Some market participants warned that abandoning quarterly reporting could lead to less transparency and more volatility in the market, and thus make U.S. stocks less attractive, Reuters recalls .

Chinese electric car manufacturer BYD forecasts that in 2025 exports will account for about 20% of the company's global sales, or 800 thousand to 1 million cars out of a total volume of 4.6 million, Reuters reports. For comparison, in 2024, BYD's share of foreign deliveries did not exceed 10% with 4.26 million cars sold.

The company previously cut its overall sales target for 2025 by 16%, reflecting a slowdown in growth to a five-year low. This is a signal that the era of record expansion is coming to an end, the agency said.

According to BYD brand and PR manager Li Yunfei, new models and BYD's own fleet of car transporters will be the drivers of exports, and international sales will play an increasingly important role in the company's business.

- Japan's broad Topix index fell 1.4 percent, while the Nikkei 225 declined 0.7 percent.

- In South Korea, the Kospi index jumped 1.4 percent, while the Kosdaq small-company index rose 1.3 percent.

- Australia's S&P/ASX 200 added 0.8%.

- Futures on the Nasdaq 100 rose 0.4 percent, while contracts on the S&P 500 and Dow Jones Industrial Average were up about 0.3 percent.

This article was AI-translated and verified by a human editor