Index inclusion promises Saudi a pre-Aramco bump 29 Mar 2018 FTSE Russell will add the kingdom to global and emerging-markets indexes. MSCI is likely to follow suit, which could steer billions in index funds to the Riyadh exchange. That will make the Saudi market more international even if Aramco’s privatization stays local – or on hold.
Barclays settlement fixes one of several headaches 29 Mar 2018 The UK lender is paying $2 billion to settle U.S. regulators’ claims of mortgage securities mis-selling. That’s less than peers paid and removes some uncertainty. But the outcome of a UK investigation is still pending and CEO Jes Staley has yet to turn the investment bank around.
Facebook’s size is its other looming problem 28 Mar 2018 The social network – like Google – collects massive amounts of intel on users to sell advertising. The more Google knows, the better its search results get. But adding ever more data risks making Facebook less entertaining – and its users more wary of compromising their privacy.
CME stretches to kill NEX bidding war 29 Mar 2018 The Chicago Mercantile Exchange owner is buying Michael Spencer’s broker for 3.9 billion pounds. Meshing U.S. Treasury futures trading with NEX’s currency and bonds business is a good idea. The hefty premium may deter rival bidders but requires the deal to be perfectly executed.
Tricky Renault-Nissan deal would be rewarding 29 Mar 2018 The French and Japanese groups chaired by Carlos Ghosn may merge to create a carmaker that trades as a single stock. The Gallic state, which owns 15 pct of Renault, would put up roadblocks. But after 19 years of cooperation, margins are low enough to make the union worth a try.
Legal woes could impair SocGen’s 2020 vision 29 Mar 2018 The French lender says it is close to settling with U.S. regulators over investigations relating to Libya and Libor. A sanctions-busting probe could pose a sterner test, though. Any fine above 1.8 bln euros could threaten SocGen’s capital target – and put pressure on dividends.
China’s business culture sabotages its art culture 29 Mar 2018 Art Basel’s Hong Kong fair kicked off on Thursday. Mainland sales rose 14 pct to $13.2 bln in 2017; exhibitors hope enthusiasm will prove contagious. But Chinese art prices and volumes are unreliable. An excess of auction houses draws speculators and deters real collectors.
Shareholders could upset Hyundai overhaul 29 Mar 2018 South Korea’s second-largest conglomerate is finally moving to simplify its elaborate corporate structure. But the first stage of the rejig short-changes minority investors in a key unit. The controlling Chung family might have to improve the terms to get this done.
Chinese food-to-flights app offers half-baked IPO 29 Mar 2018 Meituan-Dianping may float in Hong Kong this year. That looks premature, as fights loom over takeaways and taxis. Stock investors could punish the $30 billion startup for burning cash to win market share. It would be better to stay private until it has a clearer edge over rivals.
Rocket-fueled stocks finally feel the burn 28 Mar 2018 Amazon lost as much as $50 bln in value, perhaps partly because Donald Trump isn’t a fan. Tesla’s stock fell another 8 pct-plus. Facebook has shed nearly $100 bln of market cap. Investors once whistled past concerns that haven’t changed much. Maybe they are opening their ears.
Equifax CEO pick has lesson for Facebook 28 Mar 2018 The hacked $14 bln credit-scorer’s new boss is more technocrat than tech nerd. Then again, Facebook’s poor handling of its data woes suggests having a coding genius in charge is no certain solution. Hiring an outside manager willing to ask tough questions is a step forward.
Unilever-FTSE standoff is test of index power 28 Mar 2018 The benchmark compiler must decide whether to keep the Marmite maker in the FTSE 100 after it opted for a Dutch head office. Recent tax changes and activist pressure may prompt similar rejigs at heavyweights Shell and BHP. The index may have to bend its rules to retain its clout.
UK gender pay gap requires “just do it” approach 28 Mar 2018 Disclosures have revealed discrepancies, especially in finance, which will not close on their own. The state can help. Fining employers which fail to make progress over several years would align the interests of women and investors. CEOs would have to match words with actions.
Apple stores up Yahoo-like trouble in China 28 Mar 2018 Keeping Chinese iCloud user data inside the People's Republic invites controversy amid Facebook's latest woes. After Yahoo shared emails with Beijing in 2004, Jerry Yang and other bosses were hauled up to Capitol Hill and called moral "pygmies." Apple should brace for blowback.
Coal clearout puts Rio on path to greener deals 28 Mar 2018 The Anglo-Australian miner has raised $4.2 bln this month getting out of coal. That implies more buybacks and fewer environmental concerns, helping lift Rio Tinto’s modest valuation. It can also focus on future growth, including investments in battery ingredients like lithium.
Chinese banks healthy enough for stronger medicine 28 Mar 2018 Stable real estate and solid corporate profits helped boost annual earnings at AgBank, CCB, ICBC and others. Manic asset growth slowed and risk buffers thickened. The way is clear for reformers to tolerate more defaults and address flaws in China’s debt-for-equity swap programme.
Cox: A beneficent billionaire should buy Remington 27 Mar 2018 The AR-15 maker filed bankruptcy papers a day after millions of Americans marched in favor of banning its products. Owners and creditors just want out in a hurry. But Bloomberg, Gates or Bezos could turn Remington into a force for sensible gun policies with mere pocket change.
Deutsche CEO quest will be hard work 27 Mar 2018 The German lender has begun looking for a new boss. Replacing John Cryan may prove difficult until the company figures out whether to be a global investment bank or return to its more modest corporate lending roots. Nor are there obvious fixes for an ailing business model.
Drug companies take the anti-Amazon pill 27 Mar 2018 Novartis is selling its consumer health assets to GSK for $13 bln. It makes sense for the former to focus on traditional drugs given the threat from e-commerce. For the latter, the purchase is less risky than a Pfizer deal and may still allow investment in its core business.
Carlyle’s $12.6 bln Akzo deal has good chemistry 27 Mar 2018 The U.S. private equity group is buying a speciality chemical unit that the Dutch company put on the block after a failed PPG bid. Carlyle knows the industry and has slashed costs at Axalta. While there may be less scope for huge cuts this time, decent returns are still on offer.