French elections beat Brexit for market disquiet 30 Jan 2017 The Gallic vote is worrying investors more than Britain leaving the EU. It now costs over a third more to insure against a French default than a UK one, though rating firms see little chance of either going bust. It's the scope to weaken its currency that gives Britain an edge.
Publicis boss exit plan is bad ad for succession 27 Jan 2017 Maurice Levy is finally stepping down from running the $16 bln advertising firm, but he'll only move to the supervisory-board chairman's office. The presence of Levy, in charge for 30 years and a proven reluctant ex-CEO, risks clipping the wings of the new leader, Arthur Sadoun.
France’s Macron is gifted risky centre ground 23 Jan 2017 The presidential hopeful looks increasingly like the lone mainstream candidate in the country's coming election. It's a huge opportunity to attract voters turned off by more radical solutions from the left and right. Yet appearing conventional carries its own dangers.
Safran tries too hard to please Zodiac insiders 19 Jan 2017 The French group’s $10 bln offer for the plane-parts maker only flies if most shareholders take cash, leaving shares for Zodiac’s controlling families. There’s a wrinkle: the strategic logic, and Safran’s superior performance, make the stock alternative appealing to others too.
Carrefour’s contrarian strategy fails to stack up 19 Jan 2017 Revenue in the grocer's French hypermarkets fell 1.2 percent in Q4 - the fifth consecutive quarter of negative like-for-like sales. Carrefour is more wedded to troubled big-box retail than European peers. Proceeds from an IPO of its property arm would be best spent elsewhere.
French Socialists compete to be first among losers 18 Jan 2017 The winner of the imminent primaries for the ruling party is unlikely to make it to the second round of the Gallic presidential race. Yet the economic policies of the also-ran may determine whether the National Front’s Marine Le Pen gets through to the final face-off.
Losing Luxottica could be strangely good for Italy 16 Jan 2017 The sunglasses-maker will lose its Milan listing in merging with France's Essilor. It follows the sale of other Italian icons like Italcementi and Pirelli, and may fuel angst over Gallic takeovers. In reality, it shows Italy is open for business, and cleans up a messy situation.
Eyewear megadeal more corrective than visionary 16 Jan 2017 Luxottica's founder is backing a 50 bln euro merger with French lens-maker Essilor, and is willing to cede control and some value to get the deal done. For the Italian group's other shareholders, that's a fair price for fixing governance issues and perhaps selling more specs.
PETA’s anti-leather push at LVMH faces handbagging 13 Jan 2017 The animal-rights group has acquired an undisclosed stake in the French luxury firm. It will keep LVMH on its toes. Yet a likely rebound in bag margins this year means that the usual goal of the activist – disposals of offending businesses – is firmly off the agenda.
Sterling crash mystery lacks suspect – and victims 13 Jan 2017 There was no single trigger for the sudden 9 percent drop in the value of the pound on Oct. 7, a committee of central bankers has found. Big banks avoided major losses, and other markets were unaffected. Investors will have to learn to live with sharp but short-lived gyrations.
Valeant’s failed idea had a grain of truth 10 Jan 2017 Drugmakers spend $50 bln a year on R&D, but the payoff keeps declining. The projected return for the dozen biggest-spending companies is now less than 4 pct, according to Deloitte. Valeant tried to slash outlays and jack up prices. But it went too far and made things worse.
EU banks handed new way to lose business 9 Jan 2017 The European Central Bank will set tougher rules than American peers to limit risky lending. The limits could make it harder for Europe’s banks to compete with U.S. or UK ones in lucrative private equity deals. The upshot may be safer lenders – but ones that make even less money.
Le Pen’s post-euro pitch is naïve but beguiling 5 Jan 2017 Far-right presidential hopeful Marine Le Pen wants to reintroduce a national currency in France alongside the euro. Her plan would face huge obstacles and involve big risks. Yet the idea of a painless reversal of the single currency project may seduce voters in France and beyond.
Bank fine-fighting begins to have some logic 5 Jan 2017 Barclays is battling U.S. authorities over charges it mis-sold mortgage bonds. UBS has contested accusations it aided tax evasion in France. With fewer outstanding legal bills and regulators habitually levying huge penalties, lenders have more to gain from pushing back.
Euro zone revival carries sting in tail 4 Jan 2017 After years in the doldrums, increased business activity and slightly rising prices are good news for the single currency area. Besides, inflation is still a long way below the European Central Bank target. But a sustained pickup would expose the euro zone's two-speed recovery.
Germany’s thriving job market no solace for Merkel 3 Jan 2017 Unemployment has fallen to its lowest since 1981, and the number of people in jobs is at a record. Chancellor Angela Merkel presided over this happy state but will struggle to leverage it in upcoming elections. Voters are more focused on less predictable flows of migrants.
Investment banks’ next trade will be EU education 30 Dec 2016 No European city has as many international school places as London. That’s a problem for firms thinking of asking staff to move their families out of the UK capital following the Brexit referendum. The solution will be for banks to get into the education business themselves.
Hadas: Russian Revolution won’t be the last 30 Dec 2016 Soviet communism initially looked like the future, but rapidly became a cruel failure. Its disappearance left big-government democratic capitalism as the sole surviving system. A century later, that hybrid model is now under global threat. It might not last another century.
Banking whales have had their day 29 Dec 2016 A year ago, Bank of England boss Mark Carney suggested regulators had cracked the "too big to fail" bank problem. Yet new rules keep coming, and international cohesion is fading. The biggest cross-border lenders like HSBC will find it ever harder to make their cost of capital.
Europe’s best antidote to populism is unpopularism 28 Dec 2016 Parties that promised to take on the elite had a roaring 2016. Even so, the withering of the moderate centre isn’t inevitable. In Greece the pendulum is swinging away from radical government. Liberals with sound economic policies can win – if they’re willing to make enemies.