Trade swings in GDP highlight challenge for Trump 27 Jan 2017 The pace of U.S. economic expansion slowed in Q4 to 1.9 pct. A drop in exports had a big impact, offsetting a third-quarter boost. The president wants more outward trade, but the volatility makes his 4 pct growth target a stretch even before planned import tariffs rock the boat.
Metro AG could be winner in Tesco’s wholesale deal 27 Jan 2017 The German retailer plans to split and form a retail-wholesale group not dissimilar to the British supermarket's 3.7 bln pound acquisition of Booker. If the market's view on Tesco's tie-up is any guide, Metro can argue its own investors aren't giving it full credit.
BT boss is behind Pearson’s in CEO sack race 27 Jan 2017 Both the UK telco and the education publisher have recently released profit warnings wiping a fifth off their market value. BT boss Gavin Patterson has a less-bad shareholder return record than Pearson's John Fallon. Some of the firm's bigger problems are also out of his control.
UBS fate is in hands of fickle markets 27 Jan 2017 The world's largest private bank reckons resurgent investors may rescue its tepid returns after $5.4 billion in net fourth-quarter outflows. Its American and investment banking businesses are bright spots and a strong dollar would help. But UBS is over-reliant on outside help.
Tesco takes tighter grip in retail tug-of-war 27 Jan 2017 A near-20 billion pound merger with wholesaler Booker is a smart response to disruption of the UK group's traditional supermarkets. But it will worry suppliers, who will provide most of the big cost savings. And Tesco may use its surplus to cut prices rather than hike dividends.
Britain’s global trade dream is second-best option 27 Jan 2017 Prime Minister Theresa May is hoping her meeting with U.S. President Donald Trump will open up a trade deal with the United States. China and others may follow. But the resulting boost to UK exports will probably be too small to replace those it risks losing by leaving the EU.
Toshiba can salvage some value for shareholders 27 Jan 2017 The stricken Japanese group will sell a stake in its prized memory-chip business. Then it needs to take further steps to counter the fallout from a huge impending writedown. Today's $10 billion market cap seems a reasonable assessment of what will remain.
Chinese tycoon turns cinema buyout into big score 27 Jan 2017 AMC, the cinema chain backed by China's richest man, is paying nearly $1 bln to become the Nordic No. 1. After a short stint in the director's chair, sellers Bridgepoint will enjoy a blockbuster return. It pays to be a seller when an A-lister like Wang Jianlin has an epic vision.
Trump’s America First drive hits a wall 26 Jan 2017 Taxing imports from Mexico is the administration's latest idea to finance a barrier on the southern border. The plan resembles a border adjustment tax favored by congressional GOPers. It could generate plenty of money, but American consumers - not Mexico - would pay the bill.
Microsoft and Google keep fog around cloud growth 26 Jan 2017 Quarterly results show both firms' on-demand computing units are growing fast. The tech giants are pouring resources into their divisions, as profit is correlated with scale. Microsoft and Alphabet are stingy, however, on essential financial details. These units merit more sunshine.
Holding: U.S. trials courting a welcome comeback 26 Jan 2017 Wells Fargo's crackdown on fake-account cases and judicial digs at in-house SEC tribunals intensify the outcry against stifling of lawsuits. Now the Supreme Court is mulling a revival of the right of workers to sue. Renewed access to judge and jury would be good for U.S. justice.
Viewsroom: Trump’s borderline tax ideas 26 Jan 2017 Two competing tariff ideas from President Trump and congressional Republicans bring merits but mostly unforeseen risks. Meanwhile, any cut in the corporate tax rate will benefit hapless Yahoo and its Asian holdings. Plus, why it pays to bet against Davos Man's thinking.
Jack Ma’s Ant Financial buys an American colony 26 Jan 2017 The $880 mln purchase of remittances firm MoneyGram looks like a counterintuitive bet in a de-globalizing world for the Alibaba founder's financial arm. International payments are a tough business. But MoneyGram gives Ant a U.S. base with tunnels to many developing markets.
Verizon’s ambition brings risk of illogical buying 26 Jan 2017 The $200 bln telco is eyeing $84 bln cable company Charter after taking on smaller AOL and – perhaps – bits of Yahoo. Past splashy bets like its $130 bln purchase of Vodafone are showing signs of structural decline. Verizon's search for new businesses is looking haphazard.
Detroit can power-steer around political obstacles 26 Jan 2017 The new president wants more U.S. factories and jobs. In theory that could cost the car industry $60 bln-plus. But Ford and GM have spare capacity and good PR folks. Other Trump policies should help carmakers, too. They can turn connected and driverless tech to their advantage.
U.S. economic data in danger of taking Chinese turn 26 Jan 2017 Donald Trump and his aides often question figures like the jobless rate. Now he is in charge of agencies supplying data, like the 2016 GDP reading due on Friday. Such statistics are hard to fudge but the new regime's penchant for extreme spin puts their credibility at risk.
Merkel ignores dark side of job boom at her peril 26 Jan 2017 Rises in employment and real incomes mask the problem of growing income inequality in Germany. Chancellor Angela Merkel’s ability to fend off an election challenge from the rebooted centre-left Social Democrats may hinge on how she proposes to stop the poor becoming poorer.
J&J bid lets Actelion have $30 bln cake and eat it 26 Jan 2017 Johnson & Johnson has offered $280 per share for the Swiss drugmaker - 70 pct more than it was worth last November. That's a full price to bolster the U.S. group's specialist drugs portfolio. Meanwhile, Actelion shareholders get to keep most of the upside from its R&D pipeline.
Sky’s rising costs highlight Murdoch bid’s appeal 26 Jan 2017 The pay-TV group's operating profit dropped 9 pct in the six months to December as pricey soccer rights kicked in. An unappealing mix of higher content costs and greater customer churn in the UK should make Sky investors look more favourably on Fox's 11 bln pound takeover offer.
RBS takes baby step on road to U.S. redemption 26 Jan 2017 The UK bank's latest $3.8 billion charge almost doubles provisions relating to alleged mis-sellling of U.S. mortgage securities. The final cost could be far higher, since RBS is probably a year away from a settlement. Still, the extra bit of balance sheet clarity is welcome.
Line delivers a disappointing status update 26 Jan 2017 Unexpectedly weak results from Japan's top chat app sent its shares crashing. Line outdoes WhatsApp in making money from selling games, stickers and services to users. But sales growth is slowing - and it now looks more reliant on advertising than previously thought.
Next HK leader needs Beijing’s help on inequality 26 Jan 2017 The race for Hong Kong's top job is on. Rising inequality and house prices are choking the middle class. It's a ticking social bomb, but Beijing seems focused on stifling local radicals. Empowering a leader to fight vested business interests should be the immediate priority.
Syngenta forces hedgies to read Chinese tea leaves 26 Jan 2017 Investors have swung from despair to optimism over the agribusiness giant's $43 bln sale. The implied probability of ChemChina's bid for Syngenta succeeding has leapt from 10 pct to over 60 pct in a few short weeks. Beijing's involvement means extra complexity for arbitrageurs.
Harvard transfers to new school of investing 25 Jan 2017 After years of lagging returns on its $36 bln pot, the Ivy League endowment is slashing staff to rely more on outside managers. New boss N.P. Narvekar is also getting a tighter grip on the portfolio's underlying risks. Harvard is finally admitting it can learn from others.
Trump’s Mexican standoff a lose-lose proposition 25 Jan 2017 The American president unveiled border-wall plans as Mexican officials arrived in Washington to discuss reworking NAFTA. Trump has blasted the pact as a terrible deal. Mexico says it could ditch it entirely. A better relationship is possible, but so too is an economic disaster.
Italy’s Renzi has chance to stage feeble comeback 25 Jan 2017 The country's highest court has overhauled an electoral law crafted by Matteo Renzi. The ruling allows early elections, but that will be small consolation for the former prime minister. Even if he regains power, he may have to rely on a weak coalition that will enact few reforms.
Gary Cohn banks perfect hedge against Trump role 25 Jan 2017 Cashing out of Goldman with the stock near a high and helping the Dow top 20,000 is worth at least $100 mln to the bank's ex-No. 2. Not only is he an early beneficiary of the new regime, he's protected if the policies he promotes as the president's top economic adviser fail.
Cisco pays fantastical price to capture unicorn 25 Jan 2017 The networking giant's core switch and router businesses face tough times. Buying software firm AppDynamics for $3.7 bln offers some respite from hardware woes. At an estimated 12 times revenue, Cisco is paying over the odds to add a bit of excitement to its story.
Breakdown: Border tariff vs. border-adjustment tax 25 Jan 2017 Donald Trump wants to hit firms that outsource with a simple levy on imports. GOPers in Congress have pitched a more complex idea built into a corporate-tax overhaul, which might more reliably offset the effects of lower tax rates. The plans create different winners and losers.
Trump can teach May about the art of the deal 25 Jan 2017 A trade pact between the UK and the United States could be helpful to both. The faster it comes, the less comprehensive it would be. Yet what an accord between the two leaders might lack in scope would be made up for by the creation of a clear loser: Europe.