Cox: Stock picking for a “Trump Victory Portfolio” 28 Sep 2016 The U.S. presidential race is tight after the first debate between the two candidates and only six weeks until the election. Investors will have bigger asset-allocation decisions to make in the event Trump wins. A new fund might start by shorting Amazon and going long Greyhound.
German airlines leave logic in the ejector seat 28 Sep 2016 In most sectors, a heavily loss-making company with liabilities that exceed its assets would disappear. Yet German carrier Air Berlin is still airborne, and Lufthansa may take on a chunk of its fleet. Aviation bosses continue to think they can defy financial gravity.
Nike laces up its hurdling spikes 28 Sep 2016 The $90 bln sportswear maker is experiencing a slowdown in orders for sneakers and other gear. Margins also are contracting as challengers like Adidas become fleeter with trendier shoes and apparel. To achieve its lofty sales goal, Nike will have to kick into a higher gear.
Past mortgage fines give Deutsche room for hope 28 Sep 2016 Settlements by other banks imply the German lender owes up to $5.5 bln for mis-selling mortgage-backed securities. That's much less than the $14 bln the U.S. government wants. But a previous Deutsche fine was much bigger than rivals'. Calculating penalties is an inexact science.
Anglo-German mail merge delivers value both ways 28 Sep 2016 Deutsche Post is paying 243 million pounds for UK Mail, in a play for the British e-commerce market. The target's shares have spent a year in the doldrums after problems at its new automated hub. But a 43 percent premium makes the purchase look less opportunistic.
Italy can be bolder with its budget laxity 28 Sep 2016 Rome will delay its deficit goal next year, citing emergency factors like refugees. Brussels may quibble, but Italy needs growth, and a fiscal crunch could hurt Prime Minister Matteo Renzi's chances in a critical referendum. The leeway is too modest and fleeting to ensure either.
Iran’s upper hand in OPEC could be fleeting 28 Sep 2016 The Islamic Republic's resistance to an oil deal leaves its rival Saudi Arabia stuck with low prices. Yet that is pushing Riyadh to launch necessary economic reforms, which should make the kingdom more competitive. Iran, despite its current rapid growth, risks falling behind.
Wells Fargo belatedly answers blaring wakeup call 27 Sep 2016 CEO John Stumpf will forfeit $41 mln and his salary as the bank probes the fake accounts scandal. The ex-head of community banking also will have pay clawed back. The shame is that it took years and a lashing in Congress to get Wells Fargo's board to hold top brass accountable.
Indonesia cashes in on model tax amnesty 28 Sep 2016 Citizens have admitted hiding almost $200 bln in what is shaping up to be one of the world's more effective schemes. Success stems from low charges, credible government, and big penalties for abstainers. The global backdrop makes it a good time for other countries to strike.
Shanghai as financial hub? Don’t believe the hype 28 Sep 2016 Professionals think Shanghai is the world's next upcoming financial centre. In reality the city is losing traction thanks to official neglect, and it's more likely to retreat than advance. Foreign finance executives should put any relocation plans on hold.
Borrowers reign despite Caesars defeat 27 Sep 2016 Efforts by Apollo and TPG to salvage something from their $30 bln casino buyout largely failed after creditors fought back. Under a new deal, junior lenders will recover 66 cents on the dollar. Most debt investors bow to lame terms, however, meaning Caesars will be an exception.
Yelp earns good review for dual-class demise 27 Sep 2016 The $3.3 bln rating site's super-voting stock collapsed as designed. Groupon's is about to do the same even as Facebook and Google entrench founders and Couche-Tard mulls reversing a sunset clause. The least companies can do is give these structures a shelf life and stick to it.
Wells Fargo scandal exposes stodgy board 27 Sep 2016 Its members are the longest-tenured of the major U.S. banks. The lead independent director also gets short shrift. A certain languor may have set in and partly explains the slow response to the fake-accounts mess. There's time to get tough, but the board could use a shake-up.
StanChart picks bad time to test U.S. patience 27 Sep 2016 The emerging markets bank has referred charges of wrongdoing at one of its private equity portfolio companies to authorities. After facing the rap for sanctions abuses in 2012, StanChart is on probation in the U.S. It's a risky situation in such a politically charged atmosphere.
Dutch food IPO has a German fly in the soup 27 Sep 2016 Meal delivery website Takeaway.com is seeking 350 million euros in an IPO. Revenue is growing rapidly, but so too are losses. Investor appetite for a sales valuation in line with profitable Just Eat rests on whether it can dominate the tough German market.
Gas deal pushes limits of U.S. energy M&A thaw 27 Sep 2016 Rice Energy's $2.7 bln swoop on Vantage, which was planning an IPO, follows transactions in oilier shale regions. Paying partly in shares will limit debt, but unlike in EOG Resources' recent deal, Rice's shares fell. Maybe gas isn't yet inspiring the same animal spirits as oil.
Richard Perry calls tough time for hedge funds 27 Sep 2016 Industry-wide, decent returns are hard to find even before fees – which some firms, like Brevan Howard, are cutting. Perry, a former star once in charge of $15 bln of assets, is giving up. Management turnover hasn't helped, but the veteran clearly expects headwinds to continue.
Deutsche Bank has airbags – but only one matters 27 Sep 2016 The German lender’s market value has shrunk below 14.5 bln euros on fears of big fines. Yet markets seem calm about knock-on effects. It’s less that post-crisis bank rules are fit for purpose, and more that Chancellor Merkel would have to be brave or foolish to let Deutsche fail.
UniCredit fire sale need not destroy its returns 27 Sep 2016 The Italian bank is selling its most profitable assets to plug a capital shortfall. New CEO Jean-Pierre Mustier can recoup some lost earnings by cutting costs. Even then, UniCredit's returns might not exceed its cost of equity - but they would be a good bit better.
U.S. election campaign wags global currency market 27 Sep 2016 Forex traders decided Hillary Clinton won the first debate. A stronger Mexican peso suggests President Trump is a bit less likely, while the safe-haven yen weakened. Further gyrations will follow. But as the Brexit referendum showed, markets are bad at predicting elections.
Debate affirms worst, best of candidates’ beliefs 27 Sep 2016 The U.S. Republican nominee was brash about his business and reiterated huge growth promises. Hillary Clinton was armed with policy and a sober jobs plan. Voters didn’t learn anything new in the first presidential face-off but it reinforced views on who is ideal to spur growth.
Shrinking China stock premium has lasting quality 27 Sep 2016 Punters from China are rushing south, causing the premium at which shares on the mainland trade to those in Hong Kong to halve to 20 pct. The long overdue rebalancing looks sustainable this time around, thanks to regulatory tolerance and changing attitudes.
India’s lenders deserve to be rich global outliers 27 Sep 2016 Lenders like HDFC are among the world's priciest, trading on price-to-book ratios up to 7 times higher than Citigroup or BNP Paribas. They are well-capitalised, earn high returns, and are growing fast. The secret is lending to people, not companies. Headwinds look limited too.
Trump debate win could torpedo Mexican peso 26 Sep 2016 The currency is near a historic low. Mexico has other problems, but the polling gains of the Republican U.S. presidential candidate – who has denigrated immigrants and trade relationships – have helped weaken the peso 9 pct in three weeks. Monday's debate may deal another blow.
U.S. presidential debate has clear winner: TV 26 Sep 2016 The first of three formal wars of words between Hillary Clinton and Donald Trump is expected at attract some 100 mln viewers. A Super Bowl-sized audience would set a record. With Facebook, Twitter and Snapchat looming, broadcasters can use every big live event they can find.
Stress-test shakeup squeezes big banks again 26 Sep 2016 The largest U.S. financial institutions would be required to carry a larger capital cushion as part of new changes to the annual exams. That might shrink investor payouts. Smaller lenders, meanwhile, get relief. The Fed seems to be on a steady mission to cut banks down to size.
HSBC CEO role calls for a superbanker 26 Sep 2016 The sprawling $150 bln bank has its work cut out to replace CEO Stuart Gulliver. The job requires a multitasker who can manage huge workforces, is compliance savvy, an expert in finance, and has the knack of being able to appear in several places almost at once.
CBOE hits multiple buttons with $3.2 bln BATS deal 26 Sep 2016 The Chicago-based options exchange is paying over the odds for the NYSE competitor: the value of expected synergies falls short of covering the deal premium. But BATS' technology is a plus for CBOE, and bulking up in equities in a consolidating industry adds extra strategic heft.
Pfizer’s pricey non-split may only defer problem 26 Sep 2016 After years of study costing $600 mln, the drugmaker says it won't break itself up. Boss Ian Read always seemed keener on acquisitions. It's true the process helped close a conglomerate discount. But Pfizer's sprawl and tendency to overpay means the gap may soon reappear.
Dubai could create its own demographic dividend 26 Sep 2016 The emirate has weathered low oil prices, but an unbalanced workforce means it is missing an economic opportunity. Only one in 23 active workers is a local, official data suggests. If Dubai can't turn citizens into workers, it might as well turn skilled workers into citizens.