Big Oil’s profit bonanza raises flaring risk 2 Nov 2018 Exxon and Chevron posted sharp earnings gains and the strongest cash flows since days of $100 crude. Texas drilling is rising and areas like Guyana are booming. But price rises may not last and investors are demanding greater returns. It’s not a time for spendthrifts.
Google staff protests point to growing labor clout 2 Nov 2018 They were aimed at the company’s failures in tackling sexual harassment. Ditto at McDonald’s a few weeks ago. When executives at such different firms have to listen, though, it’s another sign – backed up by the latest U.S. jobs data – that workers are becoming a scarce commodity.
Alibaba feeds fears of cooling Chinese consumption 2 Nov 2018 Quarterly sales hit $12 billion, but the e-commerce titan missed expectations and trimmed guidance. That suggests local shoppers and advertisers may be pulling back. It won't reassure investors rattled by trade tensions and lacklustre spending during a big October holiday.
Starbucks hasn’t got recipe quite right yet 1 Nov 2018 The coffee chain’s same-store sales increased 3 percent, as it got customers to spend more per transaction while tweaking menus and working practices. Boss Kevin Johnson’s experiments are helping to turn around the lackluster U.S. business. But profitability isn’t keeping pace.
Apple’s pricey strategy carries risk 1 Nov 2018 Making its new iPhones more expensive helped boost the tech giant’s revenue 20 percent in the latest quarter. Now Tim Cook is applying the same formula to the company’s Macs, iPads and accessories. But a warning that growth may slow suggests even Apple fans have price limits.
China trade-secrets case brings sanctions closer 1 Nov 2018 State-backed chipmaker Fujian Jinhua was indicted for allegedly stealing designs from U.S. rival Micron. It was already barred from buying U.S. parts, so this raises the stakes. Former President Obama mulled sanctions for industrial espionage. That idea could be in play again.
Goldman gets no closure from banker’s 1MDB plea 1 Nov 2018 Former star banker Tim Leissner pleaded guilty in the Malaysian money-laundering scheme. The firm can cite his lies and deception. But fat fees from bond offerings should’ve raised red flags. U.S. authorities have punished Wall Street for past examples of poor oversight.
Cox: A dead president is revived for wrong reasons 1 Nov 2018 While midterm U.S. elections may be a referendum on the living president, in one California town the fight is over William McKinley’s legacy. Citizens will vote on removing a statue of the “Napoleon of Protection”. Tragically overlooked in the debate are his faulty economics.
Dan Loeb wins if he loses at Campbell Soup 1 Nov 2018 The activist rightly blames bad dealmaking for the near-halving of the foodmaker’s share price, and wants shareholders to replace the whole board. Yet cost cuts from those bad deals should raise Campbell’s valuation whatever happens. A mass ousting is neither likely nor helpful.
Viewsroom: Europe faces life after Angela Merkel 1 Nov 2018 Germany’s chancellor won’t seek re-election in 2021 and is stepping down as party chair next month after electoral setbacks. It may herald a rightward swing at home and less EU unity. Plus: investors’ embrace of Brazil’s far-right President-elect Jair Bolsonaro may prove risky.
Spotify’s profitability song skips a beat 1 Nov 2018 The Swedish music-streaming service is attracting paying users at a slower rate, and plans to increase spending on tech and tools for artists. Both trends will forestall its efforts to move into the black. Jumpy tech investors hardly need much of a reason to sell.
U.S. vote could put Wall St, Big Tech in same boat 1 Nov 2018 Polls give Democrats a good shot at taking control of the U.S. House in next week’s elections. That would mean more scrutiny for big banks like Wells Fargo and Silicon Valley titans. Tension with the White House would rise, but mortgage agency reform may spur rare bipartisanship.
DowDuPont needs its breakup more than ever 31 Oct 2018 Recession fears and a writedown have burned off a quarter of the chemical giant’s value. It’s too strong a reaction: its businesses won’t suffer equally in a downturn. Dow’s worth some $175 bln, 40 pct above its current value. Next year’s three-way split should crystallize that.
Bitcoin remains a triumph of hope over experience 31 Oct 2018 The digital money is marking its first decade with a punishing slump. Fraud and regulatory zeal have dried up issuance of rival cryptocurrencies. The underlying blockchain technology has yet to produce its first killer app. It’s a long way from Satoshi’s revolution.
Mark Zuckerberg serves platter of creepy crawlies 31 Oct 2018 The Facebook boss candidly addressed the social network’s problems - encouraging for a company with grave transparency issues. Zuckerberg still lacks answers on how to squeeze revenue from things like private messaging and video ads, but at least the bogeyman is in plain sight.
U.S. regional banks finally feel watchdog warmth 31 Oct 2018 The Federal Reserve wants to modestly loosen liquidity rules for commercial banks like U.S. Bancorp and PNC. That will leave the United States’ biggest global lenders – the likes of JPMorgan and BofA – the only ones stuck with a largely undiluted post-crisis Dodd-Frank regime.
GM’s share price doesn’t add up 31 Oct 2018 The carmaker won a near-$15 bln valuation for its autonomous-vehicles unit by ringfencing it and selling chunks to SoftBank and Honda. If that price is right, though, it means the rest of GM is valued as if it's ready for the scrap heap. Decent earnings suggest that’s unfair.
Trade and pig diseases infect China’s pork giant 31 Oct 2018 WH Group, $11 bln owner of U.S.-based Smithfield, is fighting a losing battle on two fronts. Deadly swine fever is sweeping China, while tariffs hammer its American market. Quarterly earnings fell by almost a third from a year earlier. It will get worse before it gets better.
Facebook heads into an earnings pincer movement 30 Oct 2018 The $410 bln social-media giant’s slowing sales growth is likely to continue. Combatting that, and the problems caused by fake posts, means spending more. That’ll hit both top and bottom lines and may force CEO Mark Zuckerberg to take rash countermeasures, like ill-planned M&A.
Trump red-tape cost-cuts forget clean-air benefits 30 Oct 2018 The White House touts reductions in U.S. regulatory costs of $33 bln since the president took office. Yet clean air and water, in particular, bring huge social and financial benefits, including reduced rates of dementia. Saving short-term pennies will cost long-term pounds.