>>> Telegram CEO Released From French Custody

Telegram CEO Released From French Custody

Four days after Telegram’s CEO was arrested at an airport outside Paris, French authorities have released Pavel Durov.

The AP reported that prosecutors in Paris have ordered Durov, who has French citizenship, to appear before a judge to face a possible indictment. French authorities say they are investigating illegal activities on the messaging app, including drug trafficking and child sexual abuse material.

Separately, The Wall Street Journal reported on Wednesday that French spies in 2017 attempted to hack Durov’s iPhone due to their concern over the use of Telegram by terrorists to recruit operatives and coordinate attacks. The story also said that in past years Telegram ignored subpoenas and other legal orders, which accumulated in a company email inbox that Telegram didn’t monitor closely.

>>> Europe : Brokers Upgrades & Downgrades - 28th of August 2024

>>> Up
* ArcelorMittal Raised to Buy at Deutsche Bank
* Bouvet Raised to Buy at Pareto Securities; PT 80 kroner
* Bouvet Raised to Buy at SpareBank; PT 75 kroner
* Bouvet Raised to Buy at Arctic Securities; PT 74 kroner
* Direct Line Raised to Buy at Citi; PT 223 pence
* Friedrich Vorwerk Group Raised to Buy at Berenberg; PT 27 euros
* Moderna Raised to Hold at HSBC; PT $82
* Petrobras ADRs Raised to Outperform at Grupo Santander; PT $20

>>> Down
* Itera Cut to Sell at SpareBank; PT 10.50 kroner
* Kingfisher Cut to Neutral at Citi; PT 292 pence
* Zurich Airport Cut to Equal-Weight at Barclays

>>> Initiation
* Diversified Energy Rated New Overweight at KeyBanc
* Maire Rated New Buy at Jefferies; PT 10 euros
* Mips Reinstated Buy at William O'Neil
* Nanobiotix SA ADRs Rated New Buy at Guggenheim; PT $12

>>> Call

>>> What to look at today - 28th of August 2024

Asian equities slipped on Wednesday as weak corporate earnings in China raised fresh concerns over its flagging economy. Traders are also awaiting Nvidia Corp.’s results for cues on the growth momentum of artificial-intelligence related stocks.
Chinese stocks in Hong Kong fell as much as 1.5%, while those in the mainland declined to their lowest since early February. Bottled water maker Nongfu Spring Co. shares plunged as much as 13% after posting the slowest half-year profit growth in four years, becoming the latest company to issue disappointing results. Most major benchmarks across the region were in the red, with Japan and South Korea also seeing losses. Two-year Treasury yields, which are more sensitive to interest-rate policy, fell three basis points.  Weak sentiment toward China reemerged following sluggish outlook guidance earlier this week from e-commerce firm PDD Holdings Inc. The drum beat of stuttering growth has continued through the commentary of other companies. ANTA Sports Products Ltd. on Tuesday also lowered its full-year sales guidance for one of its core brands amid expectations that it would need to hand out more discounts to woo buyers in the country. Meanwhile, Australia’s Fortescue Ltd. reported full-year profit that missed analyst forecasts, partly due to a slowdown in iron demand demand from biggest customer China. Cnooc Ltd., BYD Co. and Meituan are all set to report on Wednesday. Later in the US, investors will be looking for any clues on whether the artificial-intelligence euphoria has more room to run, with the world’s currently most influential stock, Nvidia, set to report earnings. A gauge of Australian monthly inflation cooled in July, suggesting price pressures began to ease in the current quarter though not fast enough to warrant early interest-rate cuts. The Australian dollar was steady against the greenback after rising as much as 0.3%. The yen extended losses to 0.4% against the dollar, following comments from Bank of Japan’s Deputy Governor Ryozo Himino. The BOJ will raise interest rates as long as inflation moves in line with the bank’s view, and it must monitor developments with “utmost vigilance,” Himino said. Seven & i Holdings Co. shares slipped after the operator of 7-Eleven stores sought a national security-related designation from authorities in a move that may raise potential hurdles for a takeover. Its application came after Alimentation Couche-Tard Inc. approached the company last week.  Sony Group Corp. saw its shares climb as much as 2.7% after saying it will hike the price of its PlayStation 5 in Japan.  “Ultimately what is more important are the economic fundamentals for Japan, which are improving,” David Chao, a global market strategist at Invesco Asset Management, said in a Bloomberg TV interview. “That certainly will be what will drive the Japanese market up in the second half of this year.” In other Asian corporate developments, HSBC Holdings Plc’s shares rose in Hong Kong to outperform the benchmark, after Bloomberg reported that Europe’s largest bank is considering plans that could remove layers of middle management. Shares of China’s top-selling automaker BYD fell as much as 3.1% in Hong Kong despite saying it expects overseas deliveries to account for almost half of total sales in the future. Warren Buffett’s Berkshire Hathaway Inc. sold an additional $982 million in Bank of America shares, according to a regulatory filing. In other markets, Bitcoin fell below the $60,000 level early Wednesday as part of a broad crypto market retreat that included a sharp drop in second-largest token Ether.  Oil was steady after sliding in the previous session to end a three-day rally. Gold retreated after a three-day advance that’s taken it closer to its all-time high. Nvidia Earnings Investors are gearing up for big swings in Nvidia’s shares after the $3.2 trillion company reports. Trading in the options market implies a nearly 10% move in either direction on the day following the results. The stock has rallied about 160% this year and 1,000% from its October 2022 bear-market low. Analysts, on average, are predicting that the giant chipmaker will project revenue growth of more than 70% for the current quarter. Some are estimating an even larger surge. Nvidia’s results and forecast also will serve as a barometer for AI spending across much of the technology industry.  US After Hours AMBA +18%, JWN +7.2%, SMTC +6.2%, BOX +5.1% higher on earnings; NCNO -10.2%, PVH -7.1% lower on earnings; SHAK -1.3% to close 9 stores; ELF +2.8% authorizes new $500 mln share repurchase program

Nikkei +0.07% Hang Seng -0.92% CSI -0.76% Shanghai -0.41% Shenzen -0.07%

Eur$ CNH CNY JPY GBP CHF RUB TRY WTI$ Gold BTC ETH

S&P -0.04% Nasdaq -0.16% EuroStoxx +0.10% FTSE +0.11% Dax +0.4% SMI


Macro :
- German Equities Lack Re-Rating Catalysts After 8% SAP-Led Boost
- Gold Set to Go Past $3,000 an Ounce If Fed Cuts Deep: Macro View
- Crypto Stocks Sink as Bitcoin Drops Amid Broader Selloff
- Celsius Creditors Explore Liquidation of New Bitcoin Mining Firm

Keep an eye on :
- AGFB BB : Agfa-Gevaert 2Q Revenue Misses Estimates
- AGS BB : Ageas 1H Net Operating Profit Beats Estimates (1)
- AMBA US : Ambarella Jumps After 3Q Revenue Forecast Tops Estimates
- ALLN SW : Allreal 1H Net Income CHF60.5M Vs. CHF66.7M Y/y
- AT1 GY : Aroundtown Boosts FY FFO I Forecast
- BAC US : Berkshire Sells $982 Million of Bank of America Shares
- BIOGB SS : Biogaia Offering by Holder EQT Prices at SEK117/Share
- BRBY LN : Burberry, EasyJet Indicated to Leave FTSE 100 Index
- CENER BB : Cenergy Offers Up to EU200 Million Shares: Terms
- CIFR US : Cipher Mining Buys New 300 MW Data Center Site in West Texas
- EKTAB SS : Elekta 1Q Operating Profit Misses Estimates
- BAT SS : Eurobattery Minerals, Boliden in Non-Binding Copper Offtake Pact
- XOM US : Exxon Seeks to Sell Conventional Permian Assets for $1 Billion
- GSK LN : GSK Jumps; Drugmaker Greets Delaware Supreme Court Review
- NORSE NO : Norse Atlantic Agrees in Principle Terms to Redeliver 3 787-8s
- NOVN SW : Novartis Leqvio V-Mono Phase III Study Met Primary Endpoints
- NOVOB DC : Lilly’s Move on Zepbound a ‘Modest Step Forward,’ Sanders Says
- PRU LN : Prudential 1H New Business Profit Meets Estimates
- OO6400 KS : Samsung SDI, GM Finalize Agreement for EV Battery Plant in US
- 3382 JP : Seven & I Shares Fall on Potential New Hurdle for Takeover Offer
- SHL GY : Siemens Healthineers Gets India Nod for Mpox Test Kit
- SAABB SS : Thai Air Force to Replace Old F-16s With Swedish Fighter Jets
- SAS SS : SAS Taps Former Novo Executive to Chair Airline After Chapter 11
- SOL SM : Soltec Says Executive Chairman Raul Morales Torres Resigned
- <sraIL SW : Stadler Rail 1H Ebit Misses Estimates
- SMCI US : Super Micro Falls as Hindenburg Takes Aim With Short Report (2)
- TTE FP : Total Unit Fined $48 Million for Attempted Market Manipulation
- TTE FP : Investigation of TotalEnergies CEO Closed After Three Years: AFP
- VAN BB : Van de Velde 1H Revenue EU113.3M Vs. EU120.6M Y/y
- VIG AV : VIG 1H Pretax Profit Beats Est., Sees FY at High End of Goal
- VKTX US : Viking Therapeutics Defended at Truist After Lilly-Related Drop
- WBA US : Walgreens Boots Trades Below $10 per Share, Sinks 60% YTD

WSJ : Telegram Founder Was Wooed and Targeted by Governments

Telegram Founder Was Wooed and Targeted by Governments
Pavel Durov had lunch with the French president six years ago. His phone was hacked the previous year by French and U.A.E. spies.

Six years before Pavel Durov landed in a French holding cell, the antiestablishment founder of the messaging app Telegram was in a very different position in France: having lunch with President Emmanuel Macron.

At the lunch in 2018, which hasn’t been previously reported, Macron invited the Russian-born Durov to move Telegram to Paris, people familiar with the discussions said. Durov declined at the time. The French leader even discussed granting French citizenship to him, one of the people said.

On Saturday, French authorities detained Durov in an investigation that poses the most serious threat to the antiauthority ethos of Telegram since the app was founded in 2013. His arrest has brought into sharp focus the fraught relationships the 39-year-old Durov has had with governments around the world, which have attempted to both woo and control him, often failing at both.

In 2017, the year before the meeting with Macron, French spies targeted Durov in a joint operation with the United Arab Emirates that hacked his iPhone, according to people familiar with the matter. The spy operation, which also hasn’t been previously reported, was code-named “Purple Music,” the people said. French security officials were acutely concerned about Islamic State’s use of Telegram to recruit operatives and plan attacks.

Governments have targeted Durov because of the groups that were drawn to his app, which range from pro-democracy demonstrators and dissidents to Islamist militants, drug traffickers and cybercriminals.

For years, the company ignored subpoenas and court orders sent by law-enforcement authorities, which piled up in a rarely checked company email address, according to a person close to Durov.

Telegram says it now complies with the European Union’s Digital Services Act, which requires online companies to cooperate with authorities in countering the spread of illegal content on their platforms.

This week, the Paris prosecutor’s office said Durov was detained as part of an investigation into whether platforms are enabling online criminality, including the exchange of child pornography, drug trafficking and the sale of unauthorized encryption software. Investigators are examining whether online platforms are breaking French law by refusing to cooperate with authorities in countering illegal content.

Prosecutors said they haven’t named Durov or anyone else as a target in their investigation.

While there is no indication that those earlier discussions with Macron or the hacking of Durov’s phone played a role in his detention, the details shed new light on Durov’s long and complicated relationship with France and the U.A.E.

France and the U.A.E. granted Durov citizenship in 2021, and the Gulf country invested more than $75 million into his platform that year.

Durov, by his own account, fought to keep governments from controlling Telegram while cultivating his personal image as an iconoclast. He became a hero to internet libertarians such as Elon Musk and Edward Snowden, who rallied to his defense when he was detained Saturday. Durov has used his own profile on the app to paint a colorful portrait of his life.

In a post last month, he said he was a multinational sperm donor and had fathered more than 100 children for couples in 12 countries. He recently posted a series of photos of himself shirtless on his Instagram account, including a dip into an ice bath.

“Fearless curiosity drives innovation,” he wrote in one post, followed by: “The best way to start a day is a few minutes in 0⁰C water mixed with ice.”

Durov gained early fame in Russia as a tech entrepreneur with a libertarian streak. His political leanings and interest in encrypted-messaging systems made him an irritant to Russian and Western security services alike.

In 2006, he started a Facebook-like media site, VKontakte, which quickly gained traction as a useful channel for members of Russia’s political opposition. The Kremlin demanded information about VKontakte’s users, which Durov resisted. By 2011, the site had become a tool for critics of Vladimir Putin to organize mass protests to challenge his rule. The Kremlin began pressuring Durov to sell VKontakte to a confidant of Putin, Igor Sechin. Durov resisted the sale.

Durov was already working on a new messaging app that would later morph into Telegram. Durov described it as a platform with servers spread around the world that would be essential for anyone trying to evade government surveillance.

Durov eventually left Russia in 2014, saying he faced pressure from the Kremlin to disclose communications of Ukrainian protesters. “Providing personal data of Ukrainians to Russian authorities would not only be a violation of the law, but also a betrayal of all those millions of Ukrainians who trusted us,” he wrote on VKontakte.

Afterward, one of VKontakte’s biggest shareholders said Durov was no dissident but a thief, claiming he embezzled money from the company to develop Telegram. Durov has denied the claims.

He then hopscotched between the Middle East, Europe and the Americas, accumulating passports along the way. In addition to France and the U.A.E., Durov has citizenship in St. Kitts and Nevis, a Caribbean island nation that offers it to those who can pay. He eventually based Telegram in the U.A.E.

The French passport allowed him to move freely in Europe, including on a bike trip last year to Normandy, according to his social-media posts. He traveled to the U.S. several times, the entrepreneur told the former Fox News host Tucker Carlson this year, adding that he is always greeted by Federal Bureau of Investigation agents at the airport and elsewhere, trying to obtain his cooperation.

“My understanding is they wanted to establish a relationship to, in a way, control Telegram better,” Durov said.

The FBI declined to comment.

French authorities took him into custody Saturday night after his private jet landed at Le Bourget Airport, north of Paris. Under French law, authorities have 96 hours, or until Wednesday evening, to question Durov before releasing him or charging him with a crime.

Despite the 2018 visit with Macron, French authorities long viewed Telegram with suspicion. A former French intelligence official from France’s General Directorate for Internal Security said that compromising Telegram had been a long-term effort of the country’s spy services, but didn’t comment on the hacking operation against Durov.

France’s new hard line reflects growing concern, particularly in Europe, about the threat that big digital companies pose to society. Authorities worry that Telegram, X, TikTok and other platforms are spreading misinformation, fueling antisemitism and racism and tolerating illegal commerce on their platforms. A French law signed this year requires online platforms to cooperate with authorities in rooting out such content.

That law is mirrored by the EU’s Digital Services Act, which subjects “very large” online platforms to enhanced monitoring and enforcement. Telegram said this week that it is still below the threshold of 45 million active monthly users in the bloc to be considered very large.

Durov spent years dodging the Kremlin and Western intelligence agencies. The importance of Telegram only grew during that time, particularly since Russia invaded Ukraine in 2022. Russians and Ukrainians rely on the app for news from the front, while authorities on both sides use its channels to broadcast their narratives about the war.

A Kremlin spokesman, Dmitry Peskov, told reporters Tuesday that the case against Durov could be considered to be political and a direct attempt to restrict freedom of communication, if France doesn’t present serious evidence of Durov’s guilt.

“The Kremlin has reconciled itself to Telegram at this point,” said Thomas Graham, a distinguished fellow at the Council on Foreign Relations, adding that it was ironic that the Kremlin had pivoted to voicing outrage about Durov’s arrest after trying to shutter the app a few years ago.

In his current home in the U.A.E., where political freedoms are sharply curtailed, Durov’s antiestablishment bent seems to be an odd fit. Telegram voice calls, like those of most internet calling apps, are blocked in the U.A.E., which sees encrypted calls as a security risk. Durov would occasionally have to apologize to callers when Telegram calls failed, trying out a few rival apps before finding one that might work, according to a person close to him.

U.A.E. officials didn’t immediately respond to requests for comment. In a statement after Durov’s arrest, the U.A.E. said it was closely following the case and submitted a request to France to provide him with consular services.

FT : Chinese EV maker Xpeng unveils $20,000 car with self-driving features

Chinese EV maker Xpeng unveils $20,000 car with self-driving features
Carmaker acquired project from ride-hailing giant Didi as it retrenched during Beijing’s tech crackdown

Chinese carmaker Xpeng has launched a low-priced electric vehicle based on technology sifted from the ashes of ride-hailing group Didi’s thwarted efforts to break into the country’s highly competitive automotive sector.

The Mona M03 saloon, based on an unfinished car project Didi sold to Xpeng for HK$5.84bn ($744mn) last year, features a Tesla-like button-free dashboard and an artificial intelligence-powered self-driving system.

With a starting price of just Rmb119,800 ($16,800), half that of Tesla’s Model 3 standard version, the M03 is competing against the US EV manufacturer and models offered by Chinese domestic market leader BYD.

He Xiaopeng, Xpeng co-founder and chief executive, said at a launch event in Beijing on Tuesday night that it was “the only car with advanced autonomous driving” selling for less than Rmb200,000. The “Max” version with self-driving features starts at Rmb155,000.

Didi has been forced to rein in its ambitions since becoming a prime victim of Beijing’s tech crackdown when it listed on the New York Stock Exchange in 2021.

It subsequently delisted and suffered restrictions on signing up new customers and drivers, as well as an Rmb8bn fine for “vile” breaches of China’s data security laws.

“Didi sold the project to Xpeng due to financial issues,” said Wu Zhefeng, a Mona product manager who moved to Xpeng from Didi after the acquisition. A new car project required heavy investment “that was very challenging for Didi”, he added.

“The more in-depth co-operation with NavInfo and AutoAi will be centred on the area of smart transport, exploring more scenarios of intelligent mobility,” Didi said in a statement.

Didi recently sold its smart driving and “cockpit assets” unit AutoAi to state-backed digital mapping company NavInfo for Rmb450mn, according to a stock exchange filing on Wednesday.

The sale of its car-related businesses contrasts with the initial success of Chinese tech giant Huawei in establishing itself as a leading supplier to EV makers and its rival Xiaomi’s rapid launch of its own electric vehicle.

Xpeng’s He said Didi’s design concept and use of its driver data in the development of self-driving had meant major savings that made it easier to push down the M03’s price.

The new model was not intended for use in the ride-hailing company’s fleet or those of its rivals, he said, adding: “Our vision is instead to [serve] young individual customers who favour autonomous driving technologies.” The Max version can park itself without anyone behind the wheel and drive itself on frequently visited roads.

Analysts said the M03 marked a departure from Xpeng’s established image as a premium EV brand and would take the Volkswagen-backed company into the crowded affordable market segment dominated by BYD.

Xpeng’s move to widen its range is seen as an effort to boost sales volumes even at the expense of profit margins amid a prolonged price war in the world’s largest car market.

“Considering the stiff competition in the Chinese market, car companies only care about how to win as many orders as possible with an attractive price, while neglecting the costs,” said Li Yanwei, a member of the China Automobile Dealers Association’s expert committee.

The Mona M03 passed 10,000 orders within an hour of going on sale, Xpeng said in a social media post on Tuesday. The carmaker delivered 30,200 cars in the second quarter, a fraction of BYD’s 982,700 units in the same quarter.

With the new model set to squeeze Xpeng’s profitability, its chief executive acknowledged it faced a major challenge.

“Only seven major automakers will survive in the Chinese market over the coming decade,” He said at the launch, adding that annual sales of 1mn AI-equipped cars would be “the ticket to the final battle”.

>>> US After Hours Summary: AMBA +18%, JWN +7.2%, SMTC +6.2%, BOX +5.1% higher o

After Hours Summary: AMBA +18%, JWN +7.2%, SMTC +6.2%, BOX +5.1% higher on earnings; NCNO -10.2%, PVH -7.1% lower on earnings; SHAK -1.3% to close 9 stores; ELF +2.8% authorizes new $500 mln share repurchase program

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: WALD +36.2%, AMBA +18%, OOMA +7.5%, JWN +7.2%, SMTC +6.2%, BOX +5.1% (also authorizes new $100 mln share repurchase program), VNET +5%, TWFG +3.5%, S +2.4%

Companies trading higher in after hours in reaction to news: OCS +7.6% (stock offering by selling shareholder), DRS +5.5% (receives $117 mln US Army order for thermal weapon sights), HLX +4% (announces new contracts with PBR), AVPT +3.9% (commences offer to purchase all of its outstanding public warrants), ELF +2.8% (authorizes new $500 mln share repurchase program), SPIR +2.6% (provides update on new contracts), AVAV +2.3% (awarded $990 mln US Army contract), CIFR +2.1% (to acquire a new data center in West Texas), GEOS +1% (sells OBX-750E data acquisition nodes), UFPI +0.5% (CEO to become Exec Chairman; names new CEO; also CFO to add new role), WMT +0.2% (Walmart Marketplace accelerates growth; launches category expansion), NSP +0.1% (CFO to retire, names new CFO)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: NCNO -10.2%, PVH -7.1%, SHAK -1.3% (to close nine company-owned stores; reiterates Q3 and FY24 guidance)

Companies trading lower in after hours in reaction to news: LAMR -2% (increases dividend), ICL -0.6% (signs 5-yr agreement of ~$170 mln with AMP Holdings), GM -0.2% (adds another ex-Apple exec to oversee software unit, according to Bloomberg), SVM -0.1% (issues updated technical report)