U.S. election jam bolsters Big Tech as safe haven 4 Nov 2020 Technology stocks like Facebook and Alphabet rose more than non-tech peers after neither Donald Trump nor Joe Biden got a quick win. The sector has soared since Covid-19 hit. Likely Washington paralysis means tech giants should escape the most damaging antitrust backlash.
Powell is Fed boss any U.S. president would keep 4 Nov 2020 The central bank chair will keep monetary policy easy and could get a second term from either Donald Trump or Joe Biden. He’ll have to live with heavy spending and borrowing either way. If the Democrat wins, there is one area that will be a better fit: a focus on racial equity.
Uber victory saves its model not its valuation 4 Nov 2020 California voters approved measures that keep the ride-sharing firm from treating drivers as employees but require it to pay healthcare and other perks. Uber avoided punishing costs. But its expensive fight underscores how much the environment for the shared economy has changed.
Close-shave U.S. election may leave many losers 4 Nov 2020 With no clear winner and the count likely to drag on, a divided government is getting more likely. Markets may be jittery temporarily. Those who stood to lose from a “blue wave,” like Wall Street and Silicon Valley, will be relieved. It bodes less well for struggling Americans.
Big democratic dividend paid out in 2020 election 4 Nov 2020 Setting aside the final decision, America at least deserves an A for participation. Voters turned out in record numbers, with perhaps two-thirds of those eligible casting ballots – the most in more than a generation. The world’s first modern democracy is far from moribund.
Next U.S. president inherits a dollar in decline 4 Nov 2020 Donald Trump failed to bend the currency to his will – it firmed when he wanted it to soften, and vice versa. While Trump may buoy the dollar more than Joe Biden in the short term, the greenback’s status as the premier reserve currency will be tested whoever wins the White House.
Bristol Myers deal gamble pays off twice over 3 Nov 2020 The pharma firm had to sell assets to close its $74 bln purchase of Celgene in 2019. It took a high-risk gamble – sell a blockbuster to Amgen and keep an unproven drug. A trial shows it got the better end of the bargain. Bristol increasingly looks like it bought Celgene cheap.
Chinese regulators add Ant to cursed mega-IPOs 3 Nov 2020 The fintech group suspended its record-breaking $37 bln share sale after watchdogs met founder Jack Ma. Other big offerings like Saudi Aramco and Facebook also hit temporary snags. Whatever happens next, the delay reflects badly on Shanghai as a venue for corporate fundraising.
Chinese tech giants take proxy war to New York 3 Nov 2020 Alibaba is jostling for a stake in U.S.-listed online fashion retailer Farfetch. That would put Jack Ma’s behemoth in contention with rivals JD and Tencent, who also have their fingers on the UK firm. Courting such investors will better equip Farfetch in its battle with Amazon.
SPACs give Wall Street another slice of the pie 3 Nov 2020 Blank-check companies generate smaller fees than traditional public offerings. But they also bring less financial and reputational risk for banks who underwrite them. As SPACs go mainstream, they could give equity bankers a new raison d’etre.
UK’s moonshot Covid test plan risks crash landing 3 Nov 2020 Prime Minister Boris Johnson is rolling out mass testing in the city of Liverpool to fight the coronavirus. Such plans have worked in China, but infected British citizens may resist being quarantined. Without penalties or more help, the scheme may be an elaborate waste of money.
Aramco’s mighty value reflects mini investor base 3 Nov 2020 Shares in the $1.8 trln Saudi oil giant are flat since January, while those of western rivals like BP have halved. Aramco’s solid and more-secure dividend explains some of the difference. But a tiny free float comprised of investors who are less likely to sell helps, too.
BNP Paribas second-wave defences look solid enough 3 Nov 2020 The $45 bln French bank reported a 2% drop in quarterly profit as bumper trading offset retail lending falls. Solid risk control bolsters CEO Jean-Laurent Bonnafé’s boast of a modest 2020 earnings decline. Even if bad debts do spike, BNP’s discount to tangible book should close.
Corona Capital: Ferrari, E-commerce, Fox 3 Nov 2020 Concise views on the pandemic’s corporate and financial fallout: Ferrari leaves its auto rivals in the dust; Russia’s online marketplace Ozon heads for a New York IPO; and Fox avoids the virus-induced advertising drought.
Beijing puts Ant on a shorter leash 3 Nov 2020 Days ahead of the company’s record-setting $34 bln IPO, founder Jack Ma was hauled in by regulators for a chat. Newly unveiled rules also would treat tech middlemen more like banks. It's the clearest sign yet that China wants to tame a wild market that’s helping fuel Ant mania.
Credit Suisse nexus may underpin Aussie deal 3 Nov 2020 U.S. investment firm Ares has provisionally offered $4.5 bln for embattled wealth manager AMP. Both the seller and suitor count alums from the Swiss bank among their senior ranks. Cosy connections could prove useless, though, if the approach kicks off a full-blown bidding war.
Facebook-Instagram can open up instead of break up 2 Nov 2020 U.S. regulators are reviewing the 2012 social media merger. Unwinding deals years later is almost impossible. Busting up what exists today is one option. But forcing tech giants to make switching to rivals easier could be a more productive way to boost competition.
Broadband pass-the-parcel still has shiny wrapper 2 Nov 2020 TPG is selling a U.S. cable internet rollup to buyout rival Stonepeak for $8.1 billion including debt. It's offloading Astound at a hefty profit, perhaps more than tripling its money. Yet the buyer has room to capitalize on Americans' growing need to get online at high speed.
Only a twin-track approach will rescue UK economy 2 Nov 2020 Finance minister Rishi Sunak will spend more to soften the impact of a new lockdown and the Bank of England is likely to loosen policy again. It won’t stop insolvencies or economic scarring. Retraining workers of all ages and encouraging productivity-boosting investment is vital.
U.S. farm aid bonanza is free market nightmare 2 Nov 2020 Farmers are receiving a record $50 billion in federal aid this year. Covid-19, trade and politics are partly to blame, but the bigger problem is too many uncompetitive farms. More handouts or price controls would further distort markets. Governments could help more by doing less.
Double deal keeps payments M&A bandwagon rolling 2 Nov 2020 Weeks after agreeing a merger with domestic peer Sia, Italian group Nexi is seeking to buy Nordic operator Nets for around 7 bln euros. A quick deal brings cost savings and geographical diversification when rivals are tied up. But swallowing another large target adds complexity.
Corona Capital: Friendly’s and Dunkin’ Donuts 2 Nov 2020 Concise views on the pandemic’s corporate and financial fallout: Two Massachusetts casual-dining chains change hands, one in bankruptcy. Friendly's found Covid-19 even more unfriendly than did Dunkin' Brands.
Carmakers head towards Wile E. Coyote moment 2 Nov 2020 The cartoon character is noted for hanging suspended before falling to earth. Similarly, soaring second-hand sales are shoring up used-car values and carmaker balance sheets. As and when state support for workers rolls off, a wave of defaults could send both downwards.
Brace for a post-euphoric Ant IPO swoon 2 Nov 2020 Investors set records in their bids for the Chinese fintech giant’s $34 bln stock sale. The fear of missing out is a powerful drug. Even if Jack Ma’s company eventually lives up to mammoth expectations, the market honeymoon can be short if Facebook and Alibaba are any guide.
China’s latest five-year plan girds for battle 2 Nov 2020 The 2021-2025 blueprint lacks a growth target despite a longer-term GDP per capita goal. That suggests Beijing is aiming for quality over quantity. An emphasis on military defence and technology self-sufficiency also speaks to anticipated geopolitical and corporate arms races.