WSJ : Disney Unveils Billions of Dollars in Theme Park Expansions

Disney Unveils Billions of Dollars in Theme Park Expansions
The Experiences division reveals specific plans for new rides and attractions that die-hard fans have been waiting on

ANAHEIM, Calif.—Villains given the run of the Magic Kingdom. A “Monsters, Inc.”-themed land at Disney’s DIS 0.29%increase; green up pointing triangle Hollywood Studios, complete with Disney’s first-ever suspended roller coaster, where riders zoom around with their legs hanging free. Four new cruise ships.

The scope and details of the tens of billions in planned investment in Disney’s Experiences unit came into clearer focus Saturday night.

The announcements came as part of Disney’s three-day D23 Expo, during a presentation that unfolded over nearly three hours at an arena near Disneyland in Anaheim. Josh D’Amaro, chairman of the division and a short-list candidate to succeed Bob Iger as Disney’s chief executive, regaled theme park habitués with his vision for growth.

From the get-go, D’Amaro moved to fend off criticism, common among Disney fans in recent years, that the company doesn’t have much in the way of shovel-ready projects in the works.

“Everything we’re going to share with you tonight is an active development,” he told the crowd, which Disney counted at 12,000. “I just want to be clear to all the fans out there: This isn’t blue sky.”

The Experiences division that includes theme parks, cruises and videogames produced 69% of the entertainment giant’s operating income in fiscal 2023.

Bloggers and fans regularly dissect Disney’s development pipeline for its theme parks. This year the division is especially under the microscope. In the company’s past two quarterly earnings reports, weakening consumer demand has led to disappointing results in the Experiences division. This has hurt Disney’s share price and raised concerns that the broader theme-park industry may be on course for a reckoning.

Disney is under pressure to offer fans new, exciting attractions to justify recent increases to ticket prices and other rising costs. It also faces growing competition from Comcast’s Universal Studios business, which plans to open a new theme park near Walt Disney World in Florida next year.

At the last D23 Expo, in 2022, the parks panel largely featured ideas far from starting construction. Fans got more details to chew on this year.

Disney is teeing up two major expansions at Walt Disney World’s Magic Kingdom park. One is a long-rumored villains-themed land based on the less savory characters from Disney’s oeuvre. The other is a new section of Frontierland inspired by the Cars franchise that will include two new rides.

The two projects, D’Amaro said, “represent the biggest expansion in the park’s entire history.”

At nearby Animal Kingdom, Disney plans to redo a section of the park now focused on dinosaurs. The new Tropical Americas land will feature rides themed after the Indiana Jones franchise and Disney’s hit film “Encanto.”

The parks presentation and a Friday night showcase introducing Disney’s coming film slate were star-studded. Dwayne “The Rock” Johnson, “Avatar” director James Cameron and composer Lin-Manuel Miranda came onstage to promote new movies on Friday.

To hammer home D’Amaro’s promise to expand Disney’s cruise ship fleet to 13 vessels before 2031, 1990s R&B stars All-4-One performed the song “I Swear.”

Saturday evening also offered details of a new portion of the Hollywood Studios park that will transport visitors to the world of Monstropolis from the Monsters, Inc. films. One of the new rides in this land will be Disney’s first suspended roller coaster.

D23 Expo has grown into a corporate phenomenon. It is a massive pep rally aiming to give fans, who often come dressed as their favorite characters, the sense that they are a part of Disney’s creative planning process. It also helps the company gauge enthusiasm for each new product, movie and character it rolls out.

On Friday night, Iger opened the ceremonies with almost Olympic fanfare, appearing onstage to introduce a presentation of the company’s new film slate. It was his first appearance at a D23 Expo in five years—he came out of retirement in late 2022 to succeed former CEO Bob Chapek.

“Boy, did I miss you,” Iger told fans, who gave him a 20-second standing ovation.

As he finished his remarks, Auli‘i Cravalho, who voices Moana, the Polynesian princess with a sequel opening later this year, burst into a new song, accompanied by dozens of dancers and percussionists. It featured the line, “Finally we’re back to who we’re meant to be!”

When Disney announced last September that it was doubling its planned capital investments in the Experiences division over the next decade, to $60 billion, the news was thin on details.

The company’s shares fell by 3.6% on the day of the announcement. That accelerated a decline that prompted activist investor Nelson Peltz to say months later that he would seek a board seat at Disney. In the proxy fight that followed, Peltz said the parks needed updates. In April, Iger triumphed over Peltz when shareholders voted decisively to keep the investor off the board.

Beyond Walt Disney World, Disney has major expansions planned for its parks in California, France and China.

Disney California Adventure at Disneyland Resort in Anaheim will add a handful of rides based on the Marvel Cinematic Universe, Cameron’s Avatar franchise and the Pixar film “Coco.”

Overseas, the first ride tied to “The Lion King” is being developed for the Disneyland Paris Resort. New Spider-Man-inspired rides are planned for Disney’s parks in Shanghai and Hong Kong.

Executives didn’t share precise timelines for the projects across the globe during Saturday night’s presentation.

>>> Solar energy breakthrough could reduce need for solar farms

Solar energy breakthrough could reduce need for solar farms


Oxford, 9 August 2024, Scientists at Oxford University Physics Department have developed a revolutionary approach which could generate increasing amounts of solar electricity without the need for silicon-based solar panels. Instead, their innovation works by coating a new power-generating material onto the surfaces of everyday objects like rucksacks, cars, and mobile phones.

Their new light-absorbing material is, for the first time, thin and flexible enough to apply to the surface of almost any building or common object. Using a pioneering technique developed in Oxford, which stacks multiple light-absorbing layers into one solar cell, they have harnessed a wider range of the light spectrum, allowing more power to be generated from the same amount of sunlight.

This ultra-thin material, using this so-called multi-junction approach, has now been independently certified to deliver over 27% energy efficiency, for the first time matching the performance of traditional, single-layer, energy-generating materials known as silicon photovoltaics. Japan’s National Institute of Advanced Industrial Science and Technology (AIST), gave its certification prior to publication of the researchers’ scientific study later this year.

“During just five years experimenting with our stacking or multi-junction approach we have raised power conversion efficiency from around 6% to over 27%, close to the limits of what single-layer photovoltaics can achieve today,” said Dr Shuaifeng Hu, Post Doctoral Fellow at Oxford University Physics. “We believe that, over time, this approach could enable the photovoltaic devices to achieve far greater efficiencies, exceeding 45%.”

This compares with around 22% energy efficiency from solar panels today (meaning they convert around 22% of the energy in sunlight), but the versatility of the new ultra-thin and flexible material is also key. At just over one micron thick, it is almost 150 times thinner than a silicon wafer. Unlike existing photovoltaics, generally applied to silicon panels, this can be applied to almost any surface.

“By using new materials which can be applied as a coating, we’ve shown we can replicate and out-perform silicon whilst also gaining flexibility. This is important because it promises more solar power without the need for so many silicon-based panels or specially-built solar farms,” said Dr Junke Wang, Marie Skłodowska Curie Actions Postdoc Fellow at Oxford University Physics.

The researchers believe their approach will continue to reduce the cost of solar and also make it the most sustainable form of renewable energy. Since 2010, the global average cost of solar electricity has fallen by almost 90%, making it almost a third cheaper than that generated from fossil fuels. Innovations promise additional cost savings as new materials, like thin-film perovskite, reduce the need for silicon panels and purpose-built solar farms.

“We can envisage perovskite coatings being applied to broader types of surface to generate cheap solar power, such as the roof of cars and buildings and even the backs of mobile phones. If more solar energy can be generated in this way, we can foresee less need in the longer term to use silicon panels or build more and more solar farms” Dr Wang added.

The researchers are among 40 scientists working on photovoltaics led by Professor of Renewable Energy Henry Snaith at Oxford University Physics Department. Their pioneering work in photovoltaics and especially the use of thin-film perovskite began around a decade ago and benefits from a bespoke, robotic laboratory.

Their work has strong commercial potential and has already started to feed through into applications across the utilities, construction, and car manufacturing industries.

Oxford PV, a UK company spun out of Oxford University Physics in 2010 by co-founder and chief scientific officer Professor Henry Snaith to commercialise perovskite photovoltaics, recently started large-scale manufacturing of perovskite photovoltaics at its factory in Brandenburg-an-der-Havel, near Berlin, Germany. This is the world’s first volume manufacturing line for ‘perovskite-on-silicon’ tandem solar cells.

“We originally looked at UK sites to start manufacturing but the government has yet to match the fiscal and commercial incentives on offer in other parts of Europe and the United States,” Professor Snaith said. “Thus far the UK has thought about solar energy purely in terms of building new solar farms, but the real growth will come from commercialising innovations – we very much hope that the newly-created British Energy will direct its attention to this.”

“The latest innovations in solar materials and techniques demonstrated in our labs could become a platform for a new industry, manufacturing materials to generate solar energy more sustainably and cheaply by using existing buildings, vehicles, and objects,” Professor Snaith added.

“Supplying these materials will be a fast-growth new industry in the global green economy and we have shown that the UK is innovating and leading the way scientifically. However, without new incentives and a better pathway to convert this innovation into manufacturing the UK will miss the opportunity to lead this new global industry,” Professor Snaith added.

FT : Iran’s president nominates former nuclear negotiator as foreign minister

Iran’s president nominates former nuclear negotiator as foreign minister
Masoud Pezeshkian proposes cabinet that balances reformist instincts with need to keep hardliners on board

Iran’s reformist President Masoud Pezeshkian has nominated a former nuclear negotiator as foreign minister to his proposed cabinet as he faces the dual challenge of resuming talks with western powers about sanctions relief while managing a potential confrontation with Israel.

Abbas Araghchi, a seasoned diplomat who played a key role in the 2015 nuclear accord negotiations, had been sidelined by hardliners in recent years as they consolidated control.

Western diplomats in Tehran and Iran’s business community welcomed Araghchi’s selection, presented to parliament on Sunday along with 18 other cabinet nominations. It was a sign that the republic might adopt a more pragmatic approach to its long-running nuclear stand-off with the west in the hope of securing sanctions relief, they said.

However, there are growing concerns that the republic is on a collision course with Israel as Iranian leaders have vowed to respond to the suspected Israeli assassination of Hamas’s political leader Ismail Haniyeh in Tehran last month.

A senior western diplomat in Tehran highlighted the difficulties of dealing with outgoing hardline officials, saying Araghchi would “make a lot of difference” on routine matters. But the diplomat added that his appointment might not signify a big shift in foreign policy, with key decisions determined by Ayatollah Ali Khamenei, the supreme leader, and the Revolutionary Guards.

The new administration faced an immediate crisis after Haniyeh’s assassination on July 31, hours after he attended Pezeshkian’s inauguration, dealing a significant blow to the republic’s prestige.

Pezeshkian, the country’s first reformist president in two decades, backed Tehran’s right to respond to an attack that Iran claimed was carried out by Israel using a short-range projectile.

Pezeshkian, who unexpectedly won a snap election after the death of former president Ebrahim Raisi in a helicopter crash in May, secured his victory in last month’s run-off against a hardliner.

He has said that Iran’s economy — hampered by currency depreciation, stagnation and years of about 40 per cent inflation — cannot recover while US sanctions on the country’s nuclear programme remain in place. Pezeshkian also promised to ease social restrictions on women, reduce internet censorship, and improve the representation of ethnic and religious minorities, as well as youth, in his government.

Pezeshkian has nominated Farzaneh Sadegh, a prominent architect, as his only female candidate. If approved by the hardline parliament, she would lead the Ministry of Roads and Urban Development and become only the second female minister in the history of the republic.

No cabinet nominations were from the Sunni religious minority, disappointing reformists who had hoped for broader inclusivity. Their exclusion underscores resistance within the Shia-dominated theocracy.

“We are not hopeless but upset with this level of discrimination and being ignored,” said a Kurdish cultural activist. “Everybody knows that the votes of Sunnis and ethnic minorities helped Pezeshkian to win, but this is not reflected in the cabinet’s choices.”

Reformist politicians said Pezeshkian did not go far enough in his cabinet selections, but added that he had to make compromises with hardliners after pledging a government of national unity.

Presidential aides have acknowledged that Pezeshkian consulted Khamenei on his cabinet choices. While this strategy might help him mitigate hardliner resistance and secure support for some limited reforms, it also constrains his ability to fully implement his campaign promises.

Notably, Pezeshkian retained the head of the Atomic Energy Organization of Iran and the intelligence minister from the previous hardline government.

Parliament has a week to review the nominees. Khamenei has already urged the legislature to co-operate with the new government to ensure that Iran speaks with “one voice”.

>>> Lykos Therapeutics announces Complete Response Letter for Midomafetamine Cap

Lykos Therapeutics announces Complete Response Letter for Midomafetamine Capsules for PTSD; FDA requests additional Phase 3 study (update)

  • U.S. Food and Drug Administration requests additional Phase 3 study
  • Issues raised in CRL echo those discussed in FDA Advisory Committee hearing
  • The Company intends to pursue all available regulatory pathways to expeditiously bring a potential new treatment to the 13 million Americans who live with PTSD, a condition that has not had new treatments available for nearly 25 years

Announced that the U.S. Food and Drug Administration ("FDA") has issued a complete response letter ("CRL") for the new drug application ("NDA") for midomafetamine capsules for the treatment of post-traumatic stress disorder ("PTSD") in adults. The FDA communicated that it had completed its review of the NDA and determined that it could not be approved based on data submitted to date. The FDA has requested that Lykos conduct an additional Phase 3 trial to further study the safety and efficacy of midomafetamine. Lykos plans to request a meeting with the FDA to ask for reconsideration of the decision and to further discuss the agency's recommendations for a resubmission seeking regulatory approval for midomafetamine capsules.

The issues expressed in the CRL echo those raised during the FDA Advisory Committee meeting on June 4, 2024. The Company and other stakeholders have expressed concerns around the structure and conduct of the Advisory Committee meeting, including the limited number of subject matter experts on the panel and the nature of the discussion, which at times veered beyond the scientific content in the briefing documents. FDA itself has acknowledged potential problems with the Advisory Committee process and has opened a public docket seeking comments on how it can be improved.

Lykos has previously published its response to the substantive issues discussed at the Advisory Committee hearing. Among others, this included concerns that Lykos' clinical data were insufficient to demonstrate durability along with questions about expectancy bias stemming primarily from participants with prior MDMA use. Lykos believes that the data included in the NDA provide sufficient evidence of efficacy and durability in line with the relevant FDA guidance. FDA's draft guidance for industry on psychedelic drugs3 indicates that endpoint data should be collected at 12 weeks; Lykos' Phase 3 studies collected endpoint data at 18 weeks, with additional exploratory endpoints collected six months or more later. In addition, Lykos had aligned with the FDA in the Special Protocol Assessment ("SPA") in 2017 on a variety of bias minimization measures in the study design. Prior MDMA use among participants was not previously viewed as detrimental. As an example, nearly 30% of participants in Lykos' Phase 2 studies reported prior use, which was shared with FDA before establishing the inclusion and exclusion criteria in the Phase 3 trial design.

The Advisory Committee panelists also raised psychotherapy as a concern, with some recommending to further characterize the extent to which psychotherapy contributes to treatment benefit and if it is even necessary. Lykos acknowledges that midomafetamine-assisted therapy represents a novel combination of drug and therapy that raises unique research questions and will continue to engage the FDA as appropriate on these challenges. Lykos remains committed to continuing development of this integrated approach. Lykos will work diligently in the coming months to address FDA's concerns and to take advantage of agency processes to resolve scientific disagreements. Following the FDA meeting, Lykos expects to provide an update on next steps for the resubmission. - Source TradeTheNews.com

FT : Does Europe need Chinese wind technology to meet climate goals?

Does Europe need Chinese wind technology to meet climate goals?
Some say Beijing groups are needed to hit emissions targets while others accuse them of benefiting from unfair subsidies

On a patch of land in northern Serbia, the development of one of Europe’s largest wind farms is a sign of the region’s efforts to meet clean energy targets. Yet the decision to pick a Chinese company to supply the turbines has caused alarm among domestic rivals.

Some fear Italy’s Fintel Energia’s use of Zhejiang Windey to supply turbines for the Maestrale Ring wind farm is part of a growing trend that threatens to repeat problems in Europe’s solar industry, where Chinese companies have undercut domestic groups on price, forcing many to collapse.

Although Chinese manufacturers account for just a fraction of Europe’s €57.2bn wind energy market, Brussels has launched an investigation into whether Beijing groups are using unfair state subsidies to slash prices to create a competitive advantage.

In April, EU competition commissioner Margrethe Vestager accused China of repeating the “playbook” in the wider clean technology sector, including big subsidies, that it has used to dominate the solar panel industry.

Pierre Tardieu, chief policy officer at trade group WindEurope that represents 550 renewable groups in the region, fears a “tipping point” where Chinese companies start to dominate the European turbine market, currently led by Denmark’s Vestas and Germany’s Siemens Gamesa.

“We believe very strongly that this would be very, very bad news for the European wind market and the European economy in general,” he added.

WindEurope, whose members include the region’s big turbine manufacturers, claim Chinese manufacturers are offering prices 40-50 per cent lower than European rivals and allowing developers to defer payments. It argues these prices are not possible without unfair public subsidies.

Last month, German asset manager Luxcara picked Mingyang, China’s fourth largest wind turbine maker by market share in 2023, as its preferred supplier of turbines for an offshore wind project.

Holger Matthiesen, Luxcara project director, said the models were “the world’s most powerful” and the deal would help the company “expedite Germany’s energy transition”.

In the UK, Swedish clean technology group Hexicon also chose Mingyang as its preferred supplier for its planned floating offshore wind project.

Other company bosses admit cheaper prices could persuade them to switch to Chinese suppliers.

“We don’t have any Chinese turbines, but if prices stay at these levels, I think you will start seeing more companies using them,” said Miguel Stilwell d’Andrade, chief executive of Portugal’s wind developer EDP, which is 21 per cent owned by China’s Three Gorges Power Corporation. “We will also consider them if they are more competitive.”

Ignacio Galán, chief executive of Spanish utility Iberdrola, added that the company tends to focus on local suppliers, but if Chinese manufacturers “are making reliable and competitive turbines, we would be ready to consider them as potential suppliers”.


In addition, analysts at Aegir Insights say a planned 250-megawatt floating offshore wind farm off the coast of Brittany, France, might not be feasible without cheaper turbines, likely to be Chinese or produced outside Europe. 

However, the Chinese have a long way to go to catch up with their European rivals. Leading turbine producers Goldwind and Windey accounted for just 1 per cent of market share in Europe last year, according to the Global Wind Energy Council (GWEC).

Mads Nipper, chief executive of Danish wind and solar farm developer Ørsted, played down concerns of a Chinese threat to home turbine producers, when he told the Financial Times earlier this year that it was unlikely they would win significant market share in western Europe. 

The Chinese Chamber of Commerce in the EU (CCCEU) insists that “technological competition and intense competition, not state subsidies, drive Chinese companies’ competitiveness”. It added that the EU’s investigation into Chinese subsidies has triggered “profound dissatisfaction and concern”.

China’s Zhejiang Windey backed the chamber, saying there were no “unfair and implicit state subsidies”.

It added: “We also call for a fair, open and transparent wind market without being manipulated by any single party. We just want to contribute to the global energy transition, with our experience and technology.”


GWEC, which has Chinese companies including Zhejiang Windey and Mingyang among its membership, agreed that maintaining “fair and transparent trade practices” was important in the face of measures launched by the EU to protect clean technology jobs against exports from Beijing.

The measures, which include the EU’s subsidies probe, have stoked worries that without Chinese technology the region could miss targets on carbon emissions. The EU has set tough climate targets that it estimates could cost €1.5tn per year in investment. 

“If we in Europe follow a reshoring agenda, with import substitution and domestic manufacturing targets, we risk [ . . .] slowing down the energy transition in Europe as everything would become a little bit more expensive,” said Simone Tagliapietra, a senior fellow at the think-tank Bruegel. 

“Instead of going against gravity and beating the Chinese or trying to compete with the Chinese on the economies of scale they’ve built, we would be better to focus on an innovation-driven industrial policy.”

Jonathan Cole, chair of GWEC but speaking in his capacity as chief executive of global wind developer Corio Generation, agreed. Shutting out Chinese businesses from the global supply chain would “significantly hinder” the ability to hit decarbonisation targets, he said.  

“Positive fiscal policy designed to stimulate the growth of local supply chains is more likely to help meet our targets than a policy designed to discourage or exclude foreign suppliers,” he added. 

Some European politicians also caution against too many barriers to Chinese companies. “We want cheap and fast and domestic production. We can only have two of those three. We should make a tactical choice,” said a senior EU diplomat. 

FT : Chair of Indian regulator invested in funds linked to Adani, alleges Hinden

Chair of Indian regulator invested in funds linked to Adani, alleges Hindenburg Research
Madhabi Buch and her husband deny claims she is biased and say their finances are an ‘open book’

The chair of India’s capital markets regulator held stakes in an offshore fund structure used by Vinod Adani, holding the agency back in investigating fraud charges against the powerful eponymous conglomerate run by his billionaire brother, according to fresh allegations levelled by US short seller Hindenburg Research.

Madhabi Buch, head of the Securities and Exchange Board of India, and her husband had “hidden” holdings in Bermuda and Mauritius entities also drawn upon by the older brother of Adani Group founder Gautam Adani, Hindenburg Research said in a post late on Saturday, citing leaked documents in its possession.

In a statement, the couple said that they “strongly deny the baseless allegations and insinuations made in the report”.

The latest allegations weer made 18 months after Hindenburg first accused Adani’s infrastructure-focused empire of corporate fraud and detailed a web of offshore funds it said were used to evade minimum shareholder listing rules. At the time, it prompted a meltdown across the conglomerate’s listed companies and erased $140bn in market value.

Sebi has yet to make public findings from multiple long-running probes into the Adani Group after India’s Supreme Court in January ordered it to wind up the investigations within three months. In June, Sebi said Hindenburg had “indulged in unfair trade practices” in its bet against the Adani Group and had “deliberately sensationalised and distorted certain facts”.

Hindenburg, making reference to previous Financial Times reporting on Adani’s links to offshore vehicles, said it suspected the alleged fund holdings by Buch — a former chief executive at India’s ICICI Securities who has chaired Sebi since 2022 — were reasons for the regulator’s “unwillingness to take meaningful action” against Adani’s offshore shareholders.

“We do not think Sebi can be trusted as an objective arbiter in the Adani matter,” Hindenburg said.

The couple first made the investments in 2015, two years before Buch joined Sebi, according to Hindenburg. The short seller also questioned Buch’s promotion of real estate investment trusts without disclosing her husband Dhaval’s advisory role with Blackstone, which has sponsored Indian Reits.

“Our life and finances are an open book,” the couple said in response to the allegations. “All disclosures as required have already been furnished to Sebi over the years. We have no hesitation in disclosing any and all financial documents, including those that relate to the period when we were strictly private citizens.”

Adani Group and Blackstone did not immediately respond to a request for comment outside regular business hours, but the conglomerate and its tycoon owner have strenuously and repeatedly denied any wrongdoing.

The renewed scrutiny raised by Hindenburg comes at an awkward time for Adani, which has mounted renewed expansion efforts at home and abroad, and is in the midst of its first share sales since scrapping a $2.4bn raise last year after the short seller’s initial barrage.

That first Hindenburg report into Adani was also used by India’s opposition as a line of attack against Prime Minister Narendra Modi, particularly ahead of this year’s elections, due to his perceived closeness to the tycoon and alleged favouritism, which both have played down and denied.

Jairam Ramesh, a spokesperson for the opposition Indian National Congress, said that it was “shocking that Buch would have a financial stake in these same funds” that were alleged to have amassed “large stakes in Adani Group companies in violation of Sebi regulations”.

Ramesh added that it also raised “fresh questions” about Buch’s two meetings with Gautam Adani in 2022 shortly after she was appointed chair of the market regulator.

>>> Barron's Weekend Summary

Barron's Weekend Summary: Wall Street experienced a wild week with dramatic stock swings

Cover:
-Wall Street experienced a wild week with dramatic stock swings, currency convulsions, and a surge in stock market volatility not seen since 2020. Despite the trading losses, the investment world saw a wake-up call from a weak July jobs report and an uptick in Japan's ultralow interest rates, which shattered complacency about the status quo. Skeptics have begun to question whether artificial intelligence will deliver on the promise implied by the near-vertical rise of the market's largest technology stocks this year. A contentious US election season and heightened global turmoil could pose more worries for the markets. Despite US stocks regaining ground, it is hard to say the turmoil is over, so it is a good time to diversify into less highly valued corners of the market than some of the Magnificent Seven tech stocks and other richly priced shares.

Interview:
-Torsten Sløk, chief economist and partner at Apollo Global Management, is known for his insightful observations on the economy and financial markets. His daily emails are filled with topics such as household wealth, commodity prices, small-cap earnings, the Treasury yield curve, and yen appreciation. Sløk joined Apollo in 2020 after 15 years at Deutsche Bank and has worked at the Organization for Economic Cooperation and Development and the International Monetary Fund. He is often consulted about the markets' latest tantrum, economic outlook, and future interest rate trajectory. On Aug. 5, he discussed topics such as the yen carry trade, inflation expectations, and the Federal Reserve's upcoming conference in Jackson Hole, Wyo.

Tech Trader:
-A federal judge has ruled that Google has monopolized internet search in a landmark antitrust ruling. The ruling is expected to significantly impact internet search or revenue for Google-parent Alphabet, as other antitrust cases involving Google and Microsoft had little impact on the internet industry. Apple could prove the bigger loser, as it gets a big chunk of its profits from that exclusive arrangement. Google is appealing the ruling, as Apple gets a big chunk of its profits from that exclusive arrangement. Investors don't seem to see the distinction, with Alphabet stock losing 2.8% since the ruling, while Apple is off 3%. The court must now conduct a separate trial on a remedy for the Google monopoly, as antitrust remedies have had an ineffective history on the internet.

The Trader:
-On Monday morning, investors were left with a white-knuckle market, with Japan's Nikkei 225 index falling 12.4%, its worst plunge since 1987, due to disappointing U.S. economic data and a surge in the Japanese yen. The S&P 500 index dropped 3%, while the Nasdaq Composite fell 3.4%. The Dow Jones Industrial Average was down 2.6%. Most observers took it in stride, as the S&P 500 had climbed 15% in the first half of the year and set over 30 new closing records. A reset could create a more solid foundation for a push higher over the rest of the year, assuming the U.S. labor market holds together. The tech-heavy NASDAQ Composite was down 13% from its mid-July peak. The move is magnified by unprecedented concentration, as tech stocks had ballooned to the point that any natural rotation away from those names caused waves rather than ripples in the broader market.
-TJX Cos experienced a 3.8% drop in its worst percentage decrease in over two years during Monday's selloff, with retail in general being affected by fears of deteriorating economic conditions. Consumers are already feeling stretched by inflation, so a worsening macro backdrop would likely mean less willingness to spend on discretionary goods. However, TJX's decline looks like an overreaction, as the company has long been a market-share gainer in retail and does particularly well in times of economic turmoil due to its value focus. TJX's core customers are wealthier than those of peers Burlington Stores and Ross Stores, meaning they are more likely to trade down to discounters rather than cut out discretionary spending altogether. TJX looks particularly well positioned during the key back-to-school shopping season, given ongoing economic uncertainty.

Features:
-The Magnificent Seven have significantly boosted the S&P 500 index over the past year and a half, but their high valuations have caught up with them, and the catalyst for propelling less-loved equities higher is becoming clearer. The Fed's recent indication of a rate cut at its September meeting is more likely than not. Investors are considering preparing their portfolios for a market where the recent drivers of gains, big technology stocks, are not as dominant. To prepare, consider whether your portfolio is equity heavy, considering the percentage of large caps in your portfolio at the beginning of 2023 compared to now. Rebalancing your portfolio towards long-term targets, such as dumping stocks and buying bonds, may be necessary. Small-cap stocks and other lagging equities are also in the limelight as gains broaden across the market. Their valuation is at a significant discount compared to large-cap stocks, even relative to their own history.
-Trump Media & Technology Group (DJT) reported sales of $837,000 and a net loss of $16.4M for the quarter ending June 30, an improvement from the previous year. The company's losses were mainly due to legal expenses from its merger with Digital World Acquisition Corp. Losses per share declined to 10 cents, but sales fell by 30% from $1.2M a year ago. Cash equivalents were $344M, up from $2.6M a year ago. Trump Media has no debt and is minimizing its reliance on Big Tech by creating its own hardware infrastructure and software system. Shares peaked on March 27 at $66 a share, but have fallen more than 60% since then.

European Trader:
-Inditex, the owner of Zara, is targeting the US market as a potential growth engine. Despite having 101 stores in the US, the company has only expanded under CEO Oscar Garcia Maceiras. Over the next two years, Inditex plans 30 projects, including new stores, relocations, and enlargements, in major American cities. The US has become Inditex's second-biggest market, accounting for 7% to 8% of total revenue and less than 2% of its global store network. The company faces competition from Chinese fast-fashion company Shein, which has grown since surpassed Zara and its rival H&M (Hennes & Mauritz) in late 2021. However, Zara's more upmarket price point should give it a distinct position in the US. Analysts at UBS suggest Zara could aim for a similar density. The company sees significant long-term growth opportunities in the US, as it takes less than 50 cents for every $100 of fashion sold.

Emerging Markets:
-Emerging market bonds are a mix of a haven and a risk asset due to the recent global market turmoil. Around 60% of the asset class consists of sovereign debt from investment-grade countries, including Poland, Saudi Arabia, and South Korea. Yields on these bonds fell as stocks hit an air pocket in early August. However, spreads over US Treasuries widened by about 20 basis points to 130 basis points, affecting high-yield emerging market paper and causing a selloff in turnaround stories like Argentina, Turkey, and Ecuador. The lower the credit rating, the larger the selloff has been. Local-currency debt is also in danger, but managers worry about the fading of the yen carry trade, which involves borrowing cheaply in Japan to reinvest in high-yielding Latin American markets. As equities continue to gyrate, the prevailing mood on emerging market bonds is to wait and see, with activity muted and bid/ask spreads very wide.

Commodities:
-No update

Streetwise:
-JP Morgan predicts that cruises are 20% cheaper now than land-based alternatives, compared to 10% to 15% cheaper in 2019. This market share shift is part of why it recently covered Six Flags Entertainment at Underweight and added Overweight-rated Royal Caribbean Group to its Analyst Focus List. Walt Disney World in Florida has seen higher prices for admission, hotels, and restaurants due to the pandemic, with discounts becoming skimpy and free perks like airport bus service and parking for hotel guests taking on surcharges. Disney World prices remain high, but discounts have grown larger and some surcharge backtracking has occurred. Disney's results for its fiscal third quarter showed meager growth in its Experiences division, which includes parks, and management foresees flat revenue and a small decline in operating profit. With theme park prices up 37% since 2019, there will be limited opportunity for companies to juice results by charging more. Disney's streaming operations have reached modest profitability, and its studios are on a record-setting summer box-office haul from Inside Out 2, an animated film featuring personified emotions.

>>> Weekend Papers Summary

Weekend Papers Summary

FINANCIAL TIMES
-Wall Street saw gains on Friday that erased losses from a week of volatile trading, including some of the worst and best days for US stocks in almost two years. The benchmark S&P 500 and the tech-heavy NASDAQ closed 0.5% higher in New York, leaving both little changed on the week. Friday's gains lifted the S&P 500 more than 4% above the lows it touched on Monday when a global sell-off sparked by weak US jobs figures turned into a full-scale rout. However, indices remain below the levels from before the US jobs report last week, which first fuelled concerns about the health of the world's biggest economy and triggered the selling spree. The S&P 500 needs to gain another 2% to recover its levels from before the sell-off began, while the Nasdaq Composite remains about 2.7% short.
-The US market has experienced a significant shift in recent weeks, with signs of increased volatility following years of calm. The market was initially complacent, believing a soft landing would be possible, leading to a "repricing of that thinking." Most observers believe the scale of the recent moves was out of proportion to the initial triggers. The sell-off was triggered by economic updates in August, such as a survey of manufacturing companies and official figures on the labor market, which heightened concerns about the US economy heading for recession and the Federal Reserve's slow rate of interest rate cuts. The jobs data in July was well short of expectations, with the US economy adding only 114,000 new jobs compared to expectations of around 175,000. This is not the worst result of the year.
-Ukraine's military has captured a crucial gas transit point for Europe, marking its most ambitious incursion into Russian territory in a decade of war. The surprise offensive, which lasted for a fourth day, is the largest attack by Kyiv's forces on Russian soil since President Vladimir Putin's full-scale invasion of Ukraine in 2022 and the Kremlin's covert invasion of Crimea and the Donbas 10 years ago. The aim is to divert Russia's troops from the east, expose its weaknesses, and strengthen Kyiv's position in future negotiations with Moscow. The first Ukrainian public confirmation of the incursion was published late on Friday, with soldiers at the office of Russian state energy group Gazprom at the Sudzha gas measuring station.
-The White House has strongly criticized Israel's finance minister, Bezalel Smotrich, for his criticism of a Gaza ceasefire deal. US National Security Council spokesman John Kirby denounced Smotrich's remarks, stating that it is not the time for a capitulating deal that ends the war before eliminating the Hamas Isis Nazis. Kirby argued that Smotrich's views would sacrifice the lives of Israeli hostages, his own countrymen, and American hostages, and contradict Israel's national security interests at this critical stage of the war. While disagreements between Israeli and American officials are common, they are usually not made public and it is rare for an American official to criticize an Israeli minister.
-Susan Wojcicki, one of Google's earliest employees and former YouTube CEO, has passed away at 56. Her husband Dennis Troper announced her death on Facebook, expressing his profound sadness and calling her a brilliant mind, loving mother, and a dear friend. Sundar Pichai, chief executive of Google parent Alphabet, expressed his unbelievably saddened sentiments. Wojcicki was a loving mother and a dear friend to many.
-Denmark is enhancing border controls with Sweden following a surge in shootings in Copenhagen involving Swedish teenagers. Justice Minister Peter Hummelgaard announced that police will increase inspections on trains across the Øresund bridge linking Denmark to Malmö and monitor car traffic on the road crossing. The increase is part of a strategy to prevent hired Swedish child soldiers who carry out tasks related to gang conflicts. Since April, 25 incidents have been linked to Danish criminal gangs hiring "child soldiers" to commit crimes in Denmark. Sweden has experienced growing gang violence, from one of Europe's lowest fatal shooting rates to one of the highest in the past decade. Swedish police argue that powerful criminal gangs often use children to commit murders, as they receive light sentences.
-Bangladeshi school pupils, students, and volunteers are cleaning and repainting Dhaka's streets following the collapse of Prime Minister Sheikh Hasina's autocratic regime. With police in hiding, children and university students are cleaning and repainting streets with revolutionary slogans, pulling over cars for inspection, and guarding Hasina's ransacked official residence. Sania Mahabub Moon, 15, and her family spent a rest day sweeping roads in Dhaka, the heart of an urban area of over 20M people. They want to rebuild the country after the collapse of the autocratic regime.
-US medicines regulators have rejected a bid to get MDMA, or party drug ecstasy, approved as a treatment for post-traumatic stress disorder. The US Food and Drug Administration issued Lykos Therapeutics, the biotech behind the treatment, with a "complete response letter" asking the company to carry out costly fresh phase-three trials due to concerns over the way the original studies had been conducted. The FDA advisory committee voted overwhelmingly against approving the treatment, which combined MDMA with therapy, citing concerns over the way Lykos's clinical trials had been designed.
-Algerian boxer Imane Khelif has been crowned Olympic champion after winning her gold-medal bout in Paris. Khelif, who also competed in the Tokyo Games in 2021, was disqualified from last year's world championships by the International Boxing Association (IBA) after failing to meet gender eligibility criteria following tests during the tournament. The International Olympic Committee has been involved in a growing controversy around gender eligibility rules. Khelif's progress through the women's 66kg competition has garnered worldwide attention and drawn the International Olympic Committee into a growing controversy. The IBA disqualified Khelif and Taiwan's Lin Yu-ting from last year's world championships after failing to meet "gender eligibility" criteria.
-Venezuela's President Nicolás Maduro has blocked access to the social media platform X for 10 days due to a dispute with its owner Elon Musk and a clampdown on dissent over his disputed re-election. Maduro accused Musk of posting on X to promote protests triggered by the election, painting the billionaire and unrest as part of a US-backed "fascist, imperialist" coup attempt in Venezuela. Maduro accused Musk of violating all rules of the social network and inciting hatred, fascism, civil war, death, and confrontation between Venezuelans. Venezuela's National Commission of Telecommunications will remove the X social network from circulation in Venezuela for 10 days. By Friday morning, posts on X had stopped loading for users inside the country, and only those with VPN access could use the site. The move comes amid a nationwide furore following Maduro's victory in the July 28 presidential election.
-China has implemented a 20-step formula to support sectors such as electronic sports, nursing care, and cruise ship development. However, experts are calling for more stimulus to stimulate consumption, especially after economic growth slowed in the second quarter due to weak household spending. China's latest trade figures showed export growth slightly slowed to 7.7% year on year in July, while imports expanded 7.2% on industry demand for overseas machinery and technology components. Fred Neumann, chief Asia economist at HSBC, said that consumption is the weak link in China's economic wobbles. The soft demand is questioned whether it is cyclical or if the problems run deeper. The soft demand is a result of household balance sheets recovering from the property bubble and the pandemic.
-Perplexity AI, an artificial intelligence search start-up, has seen a seven-fold increase in monthly revenues and usage since the start of the year, following a $250M round of funding. The AI-powered search engine answered around 250M questions in the last month, compared to 500mn queries for the whole of 2023. This growth highlights Perplexity's position as one of the fastest-growing generative AI applications since OpenAI's ChatGPT launched in November 2022. Founded by former Google intern Aravind Srinivas, Perplexity uses AI software to answer questions, using real-time information from the web, including news websites. Starting the year with $5M in annualized revenues, it now makes more than $35M on the same basis.

THE NEW YORK TIMES
-Kamala Harris and her running mate, Minnesota Governor Tim Walz, have gathered 15,000 at a rally near Phoenix, marking her largest rally yet. The campaign believes that to win in Arizona, they will need a diverse coalition that gave President Biden the state in 2020. Harris and Walz delivered a stump speech that is barely a week old, yet familiar enough to an impassioned new following. The rally was her fourth in four days with an arena-filling crowd, demonstrating the degree to which her candidacy replacing President Biden's had remade the 2024 race.
-Former President Donald Trump has resorted to using Kamala Harris's words against her at a rally in Montana. Trump played two video compilations of past remarks by Harris that his campaign hopes will portray her as overly liberal and inept. The first video drew on statements made during the 2020 presidential campaign, when she tacked to the left and backed progressive ideas on criminal justice reform. The second video was a montage of interviews and speeches that Trump's campaign used to mock her speaking style and insult her intelligence.
-Former California lawmaker Willie Brown has accused Donald Trump of mixing up one Black lawmaker for another during a recent news conference at his Mar-a-Lago Club. Trump claimed to have nearly crashed during a helicopter ride with Brown, a notable Black California politician. He threatened to sue The New York Times for reporting the story as untrue and posted on his social media site that there were "Logs,' Maintenance Records, and Witnesses" to back up his account. Trump claimed that it was Brown, who was mayor of San Francisco and speaker of the California Assembly, but Brown denied the trip. Brown, who was 90, gave several interviews on Thursday and Friday saying such a trip never occurred. The incident has raised questions about the accuracy of Trump's claims and the validity of his claims.
- A passenger plane carrying 61 people crashed in Brazil, killing all on board. The crash occurred outside São Paulo, and the cause of the crash is unknown. The plane, operated by VoePass, was carrying 61 people and was spinning in circles. Residents began filming the scene, which showed the plane falling from the sky and a black plume of smoke rising from the spot. A house on fire, a swimming pool full of debris, and a group of men peering over a scene of carnage in a yard were also seen. The airline, VoePass, has stated that the cause of the crash is unknown.
-Nationalist hatred has been linked to economic problems such as stagnant wages and declining services, even though research shows immigration benefits many economies. In Britain, such as Hartlepool, a seaside town, the rise of anti-immigrant attitudes has led to economic problems such as disposable income below the national average, more people out of the workforce, fewer active businesses, lower healthy life expectancy, and a higher crime rate. In Britain, Europe, and the United States, economic problems such as stagnant wages, roaring inequality, and declining public services have been linked to the rise of anti-immigrant attitudes. Far-right politicians have been able to exploit these frustrations to energize supporters and gain political power, despite research showing that immigration is an overall plus for most economies.
-Bangladesh, once a economic miracle, was once renowned for its focus on textiles and apparel exports. This strategy led to rapid growth, lifting millions out of poverty and earning the country's Prime Minister, Sheikh Hasina, fame and admiration. However, her abrupt exit from power has exposed the limitations of this strategy, as Bangladesh struggles to combat steep inflation and joblessness. Economists argue that poor policy decisions are largely the result of these issues. Her increasingly authoritarian rule and widespread corruption only added to the frustration that boiled over and forced her ouster. Now, Bangladesh must decide its future, as the country must decide its future.
-A report by independent investigators has revealed that Russian cruise missiles are used in combat, sometimes just weeks after rolling off the factory floor. The Kh-101 missile used in a Russian strike on a children's hospital in Kyiv last month was made this spring before the attack, according to a report by a nongovernmental organization. The report suggests Russian forces are using weapons like this as soon as they roll off the production line. This is also proof that Russia has continued to produce advanced weapons despite Western-led sanctions aimed at slowing their production. The attack on the hospital on July 8 killed two people and injured more than 30, including eight children. The Kh-101 is the Russian military's most advanced cruise missile.
-NASA's Near-Earth Object Wide-field Infrared Survey Explorer (NEOWISE), a spacecraft that studied cosmic objects before shifting its focus closer to Earth, has reached the end of its life. The spacecraft, which spent over a decade scrutinizing the skies for asteroids and comets that could pose a threat to our planet, closed its telescopic eyes for the final time at the end of last month. The mission, launched in 2009, was known as WISE and spent the next year peering at faraway objects in the universe radiating infrared light.

THE NEW YORK POST
-Former President Donald Trump accused Vice President Kamala Harris and her new running mate, Minnesota Gov. Tim Walz, of running on a "fake record" during a campaign rally in Montana. Trump, who was diverted to Billings due to mechanical problems, wasted little time going after his 2024 opponent. He criticized Harris' refusal to give media interviews or hold press conferences since replacing President Biden at the top of the Democratic ticket. Trump also referred to Harris and Walz as having a fake record, a reference to Walz, who has been criticized by Republicans and veterans for embellishing his military service.
-A growing condo crisis in South Florida is attributed to a new state law requiring condominium boards to set aside reserves for repairs and maintenance, leading to a spike in active condo listings. The number of total active condo listings in Miami-Dade, Broward, and Palm Beach counties has nearly tripled in a year, as condo owners grapple with the burden of association fees that have risen by nearly 60% over the past five years. In Miami-Dade, the median monthly condo association fee rose from $567 in 2019 to $900 this year. Condominium owners in South Florida are putting their properties up for sale due to mounting HOA fees and other costs. In Broward County, condominium owners saw their HOA fees surge by 56%, from $392 in 2019 to $613 this year. Ingrid Vassell, a condominium owner from Plantation, expressed concern about how she would stay in her property if things continued to rise.

Fortune : Canada Goose CEO isn’t worried about diluting the brand as it expands—

Canada Goose CEO isn’t worried about diluting the brand as it expands—but experts caution there are graveyards of companies that have tried

When you think of Canada Goose, you probably picture its trademark fur-trimmed parka, which is designed to keep people warm in sub-zero temperatures.

But today, the $1.5 billion winterwear company’s logo can actually be found on sneakers, T-shirts, socks and more. “We don’t just make outerwear anymore,” CEO Dani Reiss tells Fortune.

Soon, you’ll even be able to buy Canada Goose for your home.

But the leap from the safety of clothing retail—the space the brand has operated in since 1957—to the highly competitive market of homewares is a gamble, experts tell Fortune.

Canada Goose’s rapid expansion
Since taking the helm of his grandfather’s company in 2001, Reiss has scaled Canada Goose from relative obscurity into a globally recognized brand with 68 stores around the world, including in sweltering spots like Miami and Australia.

“We began with lightweight down in 2011, leveraging our reputation for extreme warmth to approach this new category with purpose,” Reiss explains.

Since then, it has ventured deeper into apparel, with its first knitwear collection hitting stores in 2017, followed by footwear in 2021.

Now, its non-heavyweight down products make up nearly half of Canada Goose’s revenue, according to Reiss. So it’s easy to see why the company is looking to continue emulating the success it’s experienced outside of parkas with eyewear, luggage, and even homeware looking ahead.

However, it’s not a guaranteed easy win for the brand, say marketing experts.

The marketing agency Live & Breathe has worked for decades with retailers like Morrisons, Real Techniques and World Duty Free on launching campaigns and brand extensions.

As its chief strategy officer Ben Alalouff points out, previous Canada Goose product launches—from trail boots to light gilets—have all tapped into the brand’s core messaging to get outdoors wearing Canada Goose.

“You don’t necessarily think about Canada Goose when you’re at home,” he says. “You look at the website, you look at the socials and it’s all about premium outerwear. There’s nothing about having a cozy or premium home… It’s building from scratch, so that could be a problem.”

The other elephant in the room is that many people splurge on Canada Goose because it’s a premium product. Dipping its toes into new categories to boost its bottom line could cheapen the brand.

Julio Hernandez, who leads KPMG’s global customer advisory practice, tells Fortune that “there’s graveyards out there of companies that have tried to do that and haven’t done it successfully.”

“We used to have a very famous brand here in the United States, a beer company called Schlitz,” he highlights.


During the 1970s, in an attempt to cut production costs and keep up with growing demand, Schlitz’s owners reformulated its recipe. “Almost overnight they lost their their following,” Hernandez says.

Likewise, consumers who splash out on Canada Goose expect a certain quality.

“The fact is you go on their website, they’ll tell you what’s the temperature rating etc. There’s some science behind that—it’s like ‘oh man, these guys really know what they’re doing,’” Hernandez adds.

“Is that ‘they really know what they’re doing’ [going to] translate into a new mug? I don’t know.”

Canada Goose wants to be like Apple
Canada Goose wouldn’t reveal the exact homeware products it’ll be releasing. However, its previously released limited edition heavy-weight blankets could serve as a hint.

“Canada Goose probably has enough of a pedigree to take a baby step,” Alalouff says, adding that picnic accessories, blankets, and candle holders would tie its new indoors collection with its existing outerwear reputation.

“Take that small step rather than that huge leap of immediately saying, ‘OK, we are now a homeware brand.’ You’re not, you’re an outdoors brand,” he adds. “Test the waters and then over time, you play a bigger part in your consumer’s lifestyle.”

Either way, diluting the brand isn’t something Canada Goose’s CEO is concerned about as it forays into homeware, eyeware, warm-weather clothing, luggage and more.

“I think about it, but I’m not worried about it,” Reiss says. “The reason I’m not worried about it is because I look at other brands out there in the world and some of the strongest brands in the world are much, much bigger than us.”

Instead of thinking like a fashion brand, he tells Fortune he’s looking up to the likes of Rolex, Range Rover and Apple for inspiration.


“These are the kinds of brands I look at that are big, and they’re not in my, in our industry,” the 50-year-old exec explains, adding that they’re “great examples of building a brand the right way.”

“We became a leader of what we do, by doing our own thing. We chose to stay being made in Canada, when everybody else in Canada—even in North America, and in many cases in Europe—were leaving the West to go manufacturing in lower-price environments…. That decision made us the company we are today. So that’s why I look at brands outside of this space.”

Plus, even after more than two decades at Canada Goose’s helm, Reiss asserts that he’s still thinking about the brand’s growth “in generations, not quarters.”

But ultimately, Alalouff warns that brands that think too ahead of themselves could end up in an early grave.

“Strategically, you can do whatever you want if you’re a cool enough brand and you have enough buy-in,” he argues. “But to think that you are going to play this incredibly wide impact on someone’s life, unless you’re the likes of Apple, is a toughie.

“As soon as a brand starts to think about itself as more than just something useful in a moment of a consumer’s life and starts to think about itself as something that matters all the time, that’s when you start to think a bit too much of yourself and start to get into trouble.”