Politics

Italian corporate finance suffers political shock

18 June 2018

The country’s election and its turbulent aftermath contributed to a sharp drop in capital markets activity. Despite still-buoyant M&A, total investment banking fees are down 30 pct year-on-year. This is bad news for banks, but worse still for local companies seeking funding.

Argentina’s road to normality hits more zigzags

15 June 2018

The replacement of the central bank chief should help stabilize the peso, along with IMF assistance, despite Thursday’s 6 percent drop. It’s all part of President Macri’s long haul to turn his country’s economic pathology into more mainstream travails. It won’t be smooth going.

Colombia’s likely leader less safe than he looks

15 June 2018

Conservative Ivan Duque leads polls ahead of Sunday’s presidential runoff. He is the more markets-friendly candidate, though his animosity to a peace deal with FARC rebels and Colombians’ distrust of business and political elites may spell discord if he wins, spooking investors.

Trump’s trade animus undermines valid China beef

15 June 2018

The White House on Friday imposed tariffs on Chinese goods in response to intellectual-property theft. It’s a legitimate issue that also plagued Obama. But Trump’s other anti-trade moves hurt his case – and U.S. importers. He also isn’t tackling China’s long-term economic threat.

Review: The other side of Trumpismo

15 June 2018

Mexico and the U.S. share complex, ever-deeper ties that contradict Donald Trump’s hostile rhetoric, Andrew Selee writes in “Vanishing Frontiers.” Bicultural businesses, movies and even co-hosting soccer’s 2026 World Cup are better signposts to the future than nationalist rants.

The Exchange: Italy’s almost premier

15 June 2018

Carlo Cottarelli talks about how he nearly led a caretaker government after President Sergio Mattarella last month rejected a euroskeptic finance minister put forward by the parties that won March elections. The former IMF economist has some advice for Italy’s new bosses.

Gary Cohn only delayed inevitable trade war

14 June 2018

The Goldman Sachs banker who went to the White House says U.S. trade spats could wipe out the benefits of tax cuts he championed. President Trump may yet escalate his campaign against China. Cohn was a helpful buffer, but Trump’s anti-globalist instincts are now in full control.

Viewsroom: AT&T win is unlikely to muzzle watchdogs

14 June 2018

The telco firm prevailed against the DOJ and can now legally buy Time Warner for $85 bln. The green light doesn’t mean that regulators will roll over for other deals however. T-Mobile US and Sprint may still be in the crosshairs. Plus: An Australian bank cartel runs into trouble.

China starts trading debt for growth

14 June 2018

Shadow bank lending slowed sharply in May, and investment growth slipped to just 6.1 pct. For now, Beijing’s target of increasing GDP by 6.5 pct annually is safe. But officials will be thinking about creative ways to keep credit flowing, even as they discourage riskier behaviour.

Italy and ArcelorMittal can unpick steel knot

13 June 2018

The government’s largest party has campaigned for shutting Europe’s top smelter, now being sold to the Indian steel group. At the very least, Italy will demand more environmental and labour pledges. Yet the fact Arcelor doesn’t look to be overpaying suggests room for compromise.

AT&T deal approval doesn’t mean anything goes

13 June 2018

The U.S. Justice Dept gambled when it sued to block the $85 bln Time Warner sale. Its failure means business as usual for vertical mergers, like Comcast’s likely bid for Fox. Big firms that directly compete will still face tough scrutiny – and prosecutors eager for a clear win.

Hadas: This should be an anti-dollar moment

13 June 2018

Discontent with the world’s dominant currency is not new, but the Trump effect is something new. A trade circuit free from the U.S. president’s idiosyncratic America-first policies is urgently needed. The euro and renminbi can provide a base, but the politics are unpromising.

Cox: The big Italy short was hiding in plain sight

12 June 2018

James Bond-style plots by hedge fund managers betting against Italy make for titillating reading. But the right-wing League has never made a secret of its dislike of the single currency. For as long as Matteo Salvini’s party remains in government, Italy will pay up for capital.

Trump and Kim’s TV diplomacy lacks definition

12 June 2018

A meeting between U.S. President Donald Trump and North Korea’s leader was mostly for the cameras. "Denuclearization" remains a distant prospect. Still, engagement reduces the risk of ruinous conflict and might even pry open Pyongyang’s closed economy, benefiting neighbours.

USG pokes hole in U.S.-Europe trade drywall

11 June 2018

The building products outfit agreed to a $6.1 bln takeover by German rival Knauf. It did well to get a 5 pct top-up given 31 pct owner Warren Buffett was already on board. In the wake of a rancorous G7 it shows companies can still transact when politicians keep out of the way.

Trump-Kim parley has a downside for Xi

11 June 2018

A breakthrough in Singapore between the mercurial U.S. and North Korean leaders would be an economic win for Seoul and others in the region. China might even profit from the détente. President Xi Jinping also could lose negotiating leverage, though, as trade tensions escalate.

Italy finance chief’s calm words clash with policy

11 June 2018

Newly appointed Economy Minister Giovanni Tria soothed investors by promising to stick with the euro and cut debt. His comments are a marked departure from the radical government’s budget-busting promises. The economics professor’s orthodox stance may prove politically untenable.

Italy’s new cabinet dials up protectionist signal

8 June 2018

Prime Minister Giuseppe Conte’s government declared a listed telco in which Libya has long been the top investor a strategic asset, hitting shares. Retelit says it can handle the state oversight. But it sends a warning to foreigners seeking to buy Italian infrastructure.

Exclusive: “Quitaly clause” marks new risk level

8 June 2018

As Rome fumbles its single-currency bona fides, global investors are taking steps to protect themselves. In a possible legal first, lawyers added language to a share purchase deal to guard against Italy leaving the euro zone, “voluntarily or by means of expulsion”.

Argentina’s $50 bln IMF deal has a year to work

8 June 2018

President Macri, like Cardinal Mazarin’s preferred generals, has been lucky as well as bold so far in his efforts to fix Latin America’s No. 3 economy. With elections not due until late 2019 and the deal shielding social spending, he has time to beat opponents’ IMF-phobia - just.