BREAKINGVIEWS

Really Big Data gives China medical AI edge

18 July 2018

Investors at a Hong Kong conference talked up a digital-healthcare revolution. The hype is also palpable in Silicon Valley, where U.S. life-sciences investment hit a record $17 billion last year. It’s early, but Chinese outfits with access to a huge data trove can take the lead.

Race to governance bottom won by China’s Pinduoduo

18 July 2018

The shopping app’s owner apes Alibaba with a partnership that controls the board and an insider committee on top. It then adds super-voting stock for founder Huang Zheng, who is a member of all three groups. Investors who buy into the $1.6 bln IPO are just along for the ride.

Investors bet fake-news swamp is left undrained

17 July 2018

U.S. lawmakers grilled Facebook, Alphabet’s YouTube and Twitter about how they filter an ocean of content. Both questions and answers made any plausible bias-free approach seem remote. Yet the companies’ rising stocks suggest confidence that no serious regulation will follow.

Powell could help stiffen Congress’ spine on trade

17 July 2018

The Fed chief told lawmakers U.S. tariffs could threaten wage growth, but said it was unpredictable. Trade policy isn’t the Fed’s remit. Politicians are, though, worried at the early effects – yet they don’t want to anger Trump. A stronger steer from Powell might tip the balance.

EU-Japan pact too tiny to lift Trump trade blues

17 July 2018

A deal between nations that account for nearly a third of world GDP has symbolic value and may save European companies up to 1 bln euros a year in custom duties. But such benefits are dwarfed by the damage the U.S. president could inflict with more tariffs, say on car imports.

Goldman gets a B-minus on governance

17 July 2018

Strong quarterly earnings may be a reassuring backdrop for boss Lloyd Blankfein’s retirement. But making David Solomon chairman and CEO muddies the Wall Street firm's succession. Splitting the roles would be better, and there’s already a good candidate on the board.

Nordic telecom mash-up gives might to challenger

17 July 2018

Sweden’s Telia is beefing up its Norwegian operations by buying rival TDC’s local business for $2.6 bln. That gives it a sturdier platform to challenge incumbent Telenor. Cost savings should help deliver a decent return – as long as it avoids price wars or a regulatory clampdown.

UK retailers’ pain is ominous for overseas peers

17 July 2018

Debenhams shares hit record lows this week after insurers reduced credit cover for suppliers. Retail is the second-riskiest UK sector for insolvency and Britain is one of the most exposed to the shift to online shopping. Its stores offer an early warning for counterparts abroad.

BYD’s football fumble salts investor wounds

17 July 2018

The $17 bln Chinese car and battery maker says a fraudster struck deals in its name, including with Arsenal. BYD has already squandered a rally in electric vehicle stocks; its muddled response to this scandal will vex stakeholders like Warren Buffett. Patience could run out.

Chinese shopping-app IPO travels long last mile

17 July 2018

Shanghai-based Pinduoduo is seeking a $20 bln valuation in a New York debut. Sales are surging, but its social-networking e-commerce business model targeted at lesser-known areas of China may perplex overseas investors. Unwelcome comparisons to Groupon and Zynga are possible.

Alibaba’s $2 bln food sale hints at indigestion

17 July 2018

The e-commerce firm is raising new funds from outside investors for its meal delivery arm Ele.me, media reports. This comes just three months after Alibaba took full control of the unit. Rival Meituan's mooted $4 bln Hong Kong flotation might be giving Jack Ma stomach jitters.

Netflix growth setback gives rivals an opening

16 July 2018

The streaming-video service attracted fewer new subscribers than forecast in the latest quarter, knocking $20 bln off its value. That will comfort Disney and Comcast as they wage a costly battle for Fox and Sky. Yet with 130 mln customers, Netflix remains far ahead in the race.

Elon Musk outburst puts Tesla board on the spot

16 July 2018

Punishing a CEO who tweets, without evidence, that someone is a pedophile ought to be a no-brainer. But Musk’s fortunes and the electric-car maker’s are symbiotic, and his allies pack the board. Investors should worry for their own sakes if directors fail to act this time.