*SWISS ASSET MANAGER GAM HIRES BANKERS TO EXPLORE SALE: SKY
GAM Holding Exploring Strategic Options Including Sale: Sky
- Upgrades:
- Charter Comm (CHTR) upgraded to Equal Weight from Underweight at Wells Fargo; tgt lowered to $340
- Toro (TTC) upgraded to Outperform from Mkt Perform at Raymond James; tgt $130
- Others:
- Anixa Biosciences (ANIX) initiated with a Buy at Chardan Capital Markets; tgt $8
- Array Tech (ARRY) initiated with an Overweight at Cantor Fitzgerald; tgt $26
- Compass Diversified (CODI) resumed with a Buy at Jefferies; tgt $26
- Enphase Energy (ENPH) initiated with an Outperform at Daiwa Securities; tgt $335
- First Solar (FSLR) initiated with an Outperform at Daiwa Securities; tgt $175
- Marsh McLennan (MMC) initiated with a Neutral at Credit Suisse; tgt $157
- SolarEdge Technologies (SEDG) initiated with a Neutral at Daiwa Securities; tgt $325
Passengers flying to UK face months of strike disruption, union chief warns
Border Force officers start eight days of industrial action while Royal College of Nursing announces strike dates in January
Passengers flying into the UK face months of disruption at the border as passport officers gear up for prolonged strikes, the head of the civil service union has warned.
Border Force officers on Friday began eight days of strikes, while the government warned people to prepare for delays and drafted in the military to help those arriving through immigration during one of the busiest travel periods.
NHS patients also face further difficulties as the Royal College of Nursing became the latest health union to signal an escalation in its campaign of industrial action, announcing two consecutive days of action on January 18 and 19.
Earlier on Friday, health service leaders had breathed a sigh of relief after the GMB union called off a planned strike by its ambulance service members on December 28, saying it did not wish to worry the public over Christmas.
The strike will be held on January 11 instead, coinciding with one of two 24-hour strikes already announced by Unison.
As the first passengers landed at airports on Friday morning Mark Serwotka, head of the PCS union, which includes Border Force staff, warned of months of strikes across the civil service.
“I think that not only could there be six months, I think in January what you’ll see is a huge escalation of this action in the civil service and across the rest of our economy unless the government gets around the negotiating table,” Serwotka told the BBC.
Prime minister Rishi Sunak said on Friday he was “sad and disappointed” at the level of disruption being caused by industrial action.
Sunak said his focus was on making the “right long-term” decisions to the benefit of everyone, adding that inflation posed a “major economic challenge” to the UK.
“When it comes to the difficult question of setting public pay, the government has acted fairly and reasonably in accepting all the recommendations of the public sector pay review bodies,” he said.
The morning rush at London’s Heathrow, the UK’s busiest airport, passed without major incident with the immigration halls “free-flowing”, the airport said, the first sign that contingency planning could limit the impact of the walkouts.
The strikes by passport officers in the PCS union will hit six airports: London’s Heathrow and Gatwick, Birmingham, Cardiff, Glasgow and Manchester. The port of Newhaven in East Sussex will also be affected. The industrial action will take place between December 23 and 26 and then between December 28 and 31.
Airport and airline officials are cautiously optimistic that most arriving travellers will not suffer exceptional disruption.
Military personnel will be joined by volunteers from within the civil service at immigration, while airlines flying into Heathrow capped ticket sales to passengers arriving on strike days to keep numbers manageable.
However, John Strickland, an aviation consultant, said Heathrow faced the biggest challenge because it handled so many long-haul flights, which used large aircraft.
The potential problems come as the UK’s Christmas getaway also faces disruption from more train strikes. Rail passengers have been warned to travel only “if absolutely necessary” on Christmas Eve, as the RMT transport union begins another three days of industrial action.
RMT members will also walk out during the first week of January, with services again set to be severely disrupted. A union overtime ban will cause problems for many operators even on non-strike days.
Meanwhile, nurses’ leaders said the new walkouts announced in January, which are limited to England, would affect 25 per cent more hospitals than the stoppages this month.
In Scotland, where RCN members voted “overwhelmingly” to reject the Scottish government’s latest offer of an average 7.5 per cent pay increase, the union will announce strike dates in the new year, the first time the NHS north of the border will have been affected by the current wave of strike action.
Pat Cullen, RCN general secretary, said the government “had the opportunity to end this dispute before Christmas but instead they have chosen to push nursing staff out into the cold again in January”.
Matthew Taylor, chief executive of the NHS Confederation, warned that “trouble awaits” the health service as it braced for four days of strike action next month.
The government “cannot just sit back and let these strikes happen when patient care is on the line and the unions must honour their commitment to protect ‘life and ‘limb’”, he added.
Chinese Pharmacies Struggle to Stock Medication as Covid Spreads
Beijing says medical supplies are sufficient, but drugstores are short of ibuprofen, antigen tests and other essentials
BEIJING—Pharmacies across China reported shortages of ibuprofen, paracetamol and other fever medication as the country struggles to cope with a surge of Covid-19 cases, weeks after Beijing abandoned its three-year effort to contain the fast-spreading virus.
Officials in Beijing deny that there is a shortage of drugs or medical equipment, and have brushed aside offers of help from the U.S. to supply vaccines and other medical goods.
Despite the government reassurances and only a negligible increase in officially reported Covid-19 cases and deaths, anecdotal evidence paints a different picture: crematoriums running at full tilt, hospitals strained and pharmacy shelves wiped out. The drug shortages in China have rippled out to Singapore and Hong Kong, where worried relatives have rushed to send medicines back home.
The absence of data makes it hard to verify the scale or extent of infections now sweeping through China. The government says fewer than 3,000 new cases of Covid-19 have been recorded nationwide on average for the past five days, a number that most health experts say is far short of what their models predict. Chinese health officials also said this week their definition of Covid-related deaths excludes patients with an underlying condition from the tally.
China has bristled at suggestions it has obscured the number of cases. On Thursday, the World Health Organization’s emergencies director, Mike Ryan, said Chinese officials appeared to be struggling to provide an accurate account of events on the ground, citing the discrepancy between the official claim of a low number of cases in intensive care units and anecdotal evidence that those wards are filling up, according to media reports. There were 416 patients classified as severe cases nationwide on Thursday, official data show.
U.S. Secretary of State Antony Blinken, in a phone call with Chinese Foreign Minister Wang Yi on Friday, discussed the coronavirus pandemic and “underscored the importance of transparency for the international community,” according to a statement from the State Department. The Chinese readout didn’t mention Covid.
The Wall Street Journal made phone calls to pharmacies in nine provinces and provincial-level regions—Shanghai, Fujian, Hubei, Sichuan, Qinghai, Guangdong, Guangxi, Anhui and Zhejiang. Pharmacists all said that they were short of fever medicine and cold remedies.
In a reflection of shortfalls of medical supplies, Tencent Holdings Ltd. , operator of the ubiquitous mobile messenger app WeChat, on Wednesday rolled out a new “mutual aid” service in which users can find neighbors in need of essentials and arrange to send them medicine.
One doctor surnamed Zhang, who works at a public hospital in Ningling County in the central Chinese province of Henan, said the hospital was no longer selling fever medication.
Dr. Zhang said that local authorities were concerned about hoarding and price gouging, saying that even hospitals’ own stockpiles were less than adequate. As for antigen testing kits, Dr. Zhang said they couldn’t be bought through regular channels—only second hand, at elevated prices.
“It’s a chaotic situation on the open market,” he said. “The problem right now is that many people are buying up medicine they don’t need out of fear, which causes the shortage. Those who really need the medicine cannot get them.”
Shanghai resident Chris Mei said he has noticed a marked shortage in drugs such as ibuprofen. Mr. Mei said he was just getting over a case of Covid himself, and was able to recover rapidly thanks to Paxlovid antiviral drugs that he had bought during a recent trip to the U.S. He said he keeps a stockpile of everyday drugs in his home, which came in handy in recent weeks as Covid cases spread rapidly in his housing complex.
“We have a lot of neighbors, they don’t have any stock and we’ve been giving them some,” he said. “It’s been difficult for a lot of people to get any of that, even just anti-fever medication.”
Mr. Mei said the spreading outbreak has also been felt at the small plastic-components factory and trading business he helps operate, where around a fourth of his workers are out sick.
He said the absence of guidelines from authorities concerning the spread of Covid or what to do about sick employees is a contrast with earlier in the year, when the local government set stringent operating conditions for companies that wished to stay open.
“It’s basically workplace to workplace on what the regulations are if you’re positive,” he said. “It’s basically every company for itself.”
In the near term, China could face another bout of Covid-induced disruption as more workers call in sick. Even with the less lethal strain of the Omicron variant of the coronavirus now driving the outbreak, the lack of exposure to the virus over the past three years means China’s population lacks the so-called hybrid immunity that results in less severe symptoms and lower fatality rates, say experts including Paul Hunter, a professor of medicine at the University of East Anglia in the U.K.
Hybrid immunity comes from the combination of exposure to the virus and vaccination, and provides a stronger and longer-lasting defense against the virus. With almost no exposure to Covid in the country’s 1.4 billion people prior to this month, China is relying on its vaccination program to fend off the virus. But protection from vaccination wanes within a few months—and China’s vaccination drive had stalled early this year, Prof. Hunter said in commentary published by the U.K.-based nonprofit information service Science Media Centre.
The scramble for medicines and antigen testing kits has extended to the overseas Chinese diaspora, though many worried relatives trying to ship supplies back home have been frustrated by lengthy delays in the postal system.
In Singapore’s Chinatown, dozens of people queued at three courier companies waiting to mail medicines to China. Two popular Chinese shipping services, SF Express and Anjie International Express, each said it would take at least a week for the parcels to arrive in China due to surging demand. Staff at Singapore’s national postal service said it would take at least a month for parcels from the city-state to reach recipients in China, up from at most 10 days previously.
Gapping down
In reaction to earnings/guidance:
- AVO -13.7%,
Other news:
- NTNX -15.9% (speculation that Hewlett Packard Enterprise (HPE) is losing interest in acquiring the company)
- FORG -1.3% (receives request for additional info from DoJ regarding merger with Project Fortress)
Gapping up
Other news:
- LPTV +11.7% (files for $150 mln mixed securities shelf offering)
- IMMP +7.9% (announces the results of a "positive" follow-up Type C meeting with the US FDA regarding late-stage clinical development plans for its first-in-class soluble LAG-3 protein, eftilagimod alpha, in conjunction with standard-of-care chemotherapy for the treatment of metastatic breast cancer)
- EVEX +3.1% (announces BNDES approval of $92.5 million line of credit to support eVTOL development program )
- AWK +3% (to acquire West San Martin Water Works potable water distribution system)
- MRSN +1.2% (MRSN and MRK announce collaboration and commercial license agreement),
Analyst comments:
- TTC +3.3% (upgraded to Outperform from Mkt Perform at Raymond James)
- CHTR +1% (upgraded to Equal Weight from Underweight at Wells Fargo),
Early premarket gappers
- Gapping up: LPTV +11.7%, EVEX +3.1%, AWK +2.7%, MRSN +1.5%
- Gapping down: AVO -13.7%, FORG -0.9%
FDA Gains New Power to Oversee Cosmetics Industry
The agency will issue manufacturing standards for cosmetic products and require makers to disclose ingredients under Congress’s spending bill
Congress gave the Food and Drug Administration more power to regulate cosmetics, ensure fast-tracked drugs work and oversee infant formula supplies in its end-of-year spending bill.
The legislation, a wide-ranging bill that authorized $1.65 trillion in federal government spending for fiscal 2023, addresses several gaps in the FDA’s regulatory powers that the agency, lawmakers and some industry groups had been seeking for years to fill.
The Biden administration has said it supports the bill and urged Congress to quickly pass it.
Under the legislation, Congress made the first changes to the FDA’s oversight of cosmetics since 1938. The bill orders the agency to issue manufacturing standards for the products, and requires companies to tell the FDA where their products are made and the ingredients—steps that were previously voluntary.
In addition, the legislation also mandates that cosmetic manufacturers report serious side effects to the FDA, gives the agency power to issue a mandatory recall and requires that cosmetics and fragrances disclose information about allergens on their labels.
“There’s been negotiations for roughly 10 years over cosmetic legislation,” said Peter Barton Hutt, a food-and-drug lawyer who has represented the cosmetics industry. “Congress never got very excited about it because cosmetics are by far the safest thing that FDA regulates.”
Microsoft Tech to Boost London Stock Exchange’s Quest for Data Dominance
Deal strengthens challenge to Bloomberg’s financial-data business, analysts say
LONDON—The London Stock Exchange LSEG -0.06% Group PLC has staked its future on financial data. A new deal with Microsoft Corp. MSFT -2.55% means it poses a bigger threat to industry leader Bloomberg LP, analysts say.
LSEG said last week it would spend $2.8 billion over the next decade on Microsoft products, mainly the latter’s cloud service. As part of the deal, Microsoft will take a 4% equity stake in LSEG, buying stock from some of the company’s major existing shareholders.
LSEG is Europe’s largest exchange operator, based on the market value of its own shares. While it runs storied exchanges in London and Milan, nowadays much of its focus is on financial data.
The company owns a mountain of data, thanks partly to all the trades that its platforms handle and through its $15 billion purchase of Refinitiv Holdings Ltd., the financial-information and terminal business. That purchase, from a consortium of Blackstone Inc. BX -1.98% and Thomson Reuters Corp. TRI -0.32% , was announced in 2019 and closed last year.
Refinitiv is one of Bloomberg’s top competitors in selling financial data to investors, corporations and other clients. Bloomberg and Refinitiv compete with Dow Jones & Co., the parent company of The Wall Street Journal.
Microsoft, meanwhile, has the Azure cloud-computing platform, Teams conferencing software and other technology.
Melding LSEG’s data and Microsoft’s tech represents the biggest threat yet to Bloomberg’s financial-data business, said Robert Iati, managing director of research firm Burton-Taylor International Consulting. Bloomberg’s competitors include LSEG’s Refinitiv unit and FactSet Research Systems Inc.
Bloomberg didn’t respond to requests for comment.
For years, companies have attempted to take on Bloomberg’s terminal business but failed to make much headway, largely because users struggled to communicate while using real-time data, Mr. Iati said.
“Everybody wants to get Bloomberg,” he said. “One of the primary reasons that the Bloomberg terminal is so sticky is its communication,” he said, pointing to the terminal’s instant-messaging feature.
Integrating Teams into the Refinitiv platform could change that, he said. “I think it’s a really good move for the LSE,” Mr. Iati added.
LSEG leaders and others said by shifting to the cloud, Refinitiv will save on data-storage costs, and data will be more readily available outside the office.
“With cloud you just call up Microsoft—they already have the capacity,” rather than buying more servers, said Michael Werner, a UBS analyst. “It just makes it easier to be more flexible in how much data and processing power you demand.”
“If this collaboration is successful we will see increasing market share and better pricing power,” Mr. Werner said. Still, he added, investors remain skeptical and any benefits could take years to materialize.
Anna Manz, LSEG’s chief financial officer, said Microsoft’s tech, including machine learning and cloud computing, will make financial models that use LSEG’s data more accurate.
Incorporating Teams will speed up financial trades and enhance communication between advisers and their clients, she said. “We can make it a much more valuable tool than a portal that contains data and analytics,” Ms. Manz said.
LSEG is at least the third big exchange since fall 2021 to reach a cloud-computing deal with a big tech company, joining CME Group Inc. and Nasdaq Inc.
The deal comes at a critical moment for the London exchange and the city as a financial hub. Initial public offerings are down sharply since the pandemic, and London is facing growing competition from Amsterdam, Paris and other cities as Europe’s biggest financial center after Britain’s exit from the European Union. The LSE is trying to woo Softbank Corp.’s Arm Ltd., Britain’s biggest tech company, to list in London instead of on the Nasdaq Stock Market.
For years, LSEG has pushed to broaden its business, reducing its reliance on traditional sources of revenue for a stock exchange such as trading and listing fees, and moving into areas such as compiling indexes. Investors tend to value predictable revenue streams, like recurring sales from data subscriptions, more highly than volatile ones.
Buying Refinitiv represented a step change. Three years ago, LSEG derived most of its money from traditional sources. Today, nearly three-quarters of its revenue comes from subscriptions—mainly the fees that clients pay for data.
“It’s no longer really an exchange business—it’s a data business now,” Mr. Werner at UBS said.
As of Thursday’s close, LSEG’s stock is up 3.7% this year, slightly ahead of the benchmark FTSE 100 index, which is up 1.2%.