TheChek News Flow

Proposed Cybersecurity Act would phase out groups such as Huawei and ZTE from telecom networks and solar energy systems

Brussels is to propose phasing out Chinese-made equipment from critical infrastructure in the EU, barring companies such as Huawei and ZTE from telecommunications networks, solar energy systems and security scanners, according to officials. 

The move comes as the EU revamps its security and tech policy by rethinking its dependence on big US tech companies as well as Chinese “high-risk” suppliers, which some officials fear could be used to collect sensitive data. The US has long banned Huawei from its telecommunications networks.

The EU’s cyber security proposal, which will be presented on Tuesday, is expected to make an existing voluntary regime to restrict or exclude high-risk vendors from their networks mandatory for EU countries, the people said.  

Previous recommendations have been unevenly implemented, with several European countries continuing to rely on such “high-risk” suppliers. Spain last summer signed a €12mn contract with Huawei for it to provide the hardware to store wiretaps authorised by judges for law enforcement and the intelligence services.

“Fragmented national solutions have proven insufficient to achieve marketwide trust and co-ordination,” said an earlier draft of the proposed Cybersecurity Act, which is still subject to change.

It follows increased efforts by Brussels to crack down on Chinese participation in critical European industries. The European Commission has launched probes into train manufacturers and wind turbine makers and raided the European offices of security equipment company Nuctech in 2024.

The exact timeline for the phaseout would depend on the assessed risk the vendor poses to the bloc and the specific sector, the officials said. The proposed timelines would also take costs and the availability of alternative suppliers into account.

More than 90 per cent of solar panels installed in the EU are made in China, for example.

Some industry officials also point to the lack of viable alternatives, given that the EU has to decrease its dependency on both Chinese and US suppliers at the same time. Telecom operators in particular have warned about the impact on consumer prices of a direct ban.

After the commission presents its proposal on Tuesday, the draft law will be negotiated with the European parliament and EU countries. As member states are in charge of national security, the proposed timelines are likely to face resistance from some European capitals. 

The proposal could cause challenges among EU lobby groups such as SolarPower Europe, the solar industry body, of which Huawei is a member, thanks to its production of inverters that are used in solar panels.

The European Commission declined to comment. Huawei did not immediately reply to a request for comment.

Beijing said in November that a Commission push to phase out the use of Huawei and ZTE technology would violate “market principles and the rules of fair competition”.

“Facts have demonstrated that in a handful of countries, the removal of Chinese telecom companies’ quality and secure equipment not only handicaps their domestic technological development but also results in heavy financial losses,” a Chinese foreign ministry spokesperson said then.

NYC may reinvest in Israel bonds in defiance of mayor Mamdani’s stance

Comptroller Mark Levine wants to separate politics from investment strategy to boost public pension fund

New York City’s pension fund could begin reinvesting in Israeli government bonds, even though new mayor Zohran Mamdani supports divesting from Israel over its conduct in the war in Gaza.

“The Israel bonds have performed very well and they continue to be investment grade rated,” Mark Levine, the city’s chief financial officer, told the FT. “My fiduciary responsibility is to make investment decisions based on that record of performance.”

Any investment would bring him into conflict with New York’s mayor. One of Mamdani’s first acts when he took office on January 1 was to revoke an executive order issued by his predecessor Eric Adams that barred city agencies from boycotting or divesting from Israel.

A staunch critic of Israel’s treatment of Palestinians, Mamdani said in a CBS interview ahead of taking office that New York “should not have a fund that is invested in the violation of international law”.

Levine, who is Jewish, said that while he had “plenty of criticisms” of the Israeli government and had “literally been out in the street protesting against” its policies, there was a need to separate investment decisions from political considerations.

“I have deep criticisms of the policies of the US government,” he said. “But we continue to own US Treasury debt.”

The debate over investment in Israel bonds highlights the tension between maximising returns of public funds and responding to social and ethical pressures.

“It illustrates how squishy all this is,” said Zachary Christensen, a researcher at the Reason Foundation think-tank. “It’s very easy to divest and to back it up with fiscal or fiduciary reasoning — and it’s easy not to as well.”

Mamdani did not respond to requests for comment.

Levine’s proposal to resume purchases of Israel bonds could reverse a 2023 decision by his predecessor, Brad Lander, to halt new investment in Israel bonds as existing holdings matured. Lander said at the time that the move was consistent with the city’s policy of avoiding foreign sovereign debt.

During his election campaign last year, Levine pledged to reinvest New York City pension funds in Israel bonds, which he said had “paid solid dividends for 75 years”.

Ten-year, dollar-denominated Israel bonds — which require a minimum investment of $25,000 — currently offer yields of 5.2 per cent, compared with 4.2 per cent for US Treasuries of a similar maturity.

The yield gap has prompted some US public funds to jump in. Palm Beach County in Florida has become the world’s largest holder of Israel bonds, with total holdings of $1bn, or one-sixth of its assets, after comptroller Mike Caruso authorised a new $350mn purchase this month.

“Israel bonds give us the highest rate of return that we can earn on all of the other investments that we are authorised by the state to invest our tax dollars in,” said County Commissioner Gregg Weiss at a press conference last week.

Levine said he was prepared for further opposition as he weighs whether to resume purchases of Israel bonds. Acknowledging many people, including the mayor, have “sharply different opinions”, he said he “cares a lot” about their views and would “continue to dialogue” with them.

He added that any investment in Israel would make up only a “tiny” share of the $311bn pension fund’s overall portfolio and that a decision would be made after discussions with trustees.

Some analysts said Levine had focused heavily on the strengths of Israel bonds but should pay closer attention to the risks that accompany their higher returns.

“There is no free lunch,” said Christensen. “Any discussion of the issue that does not grapple with both risk and potential returns is problematic.”

Private credit investors pull $7bn from Wall Street’s biggest funds

Funds managed by Apollo, Ares and Blackstone were among those hit by redemption requests in late 2025

Private credit investors pulled more than $7bn from some of the biggest funds on Wall Street in the final months of last year, as jitters over credit quality following the bankruptcies of First Brands and Tricolor hit one of the fastest-growing parts of finance.

Funds managed by Apollo Global Management, Ares Management, Barings, Blackstone, BlackRock’s HPS Investment Partners, Blue Owl, Cliffwater and Oaktree all suffered an uptick in redemption requests, according to filings with the Securities and Exchange Commission and people familiar with the matter.

Redemptions were running at about 5 per cent of the value of the funds’ investment portfolios, net of debt, according to FT calculations. Executives say the $7bn figure will grow as funds report more numbers in the weeks ahead, underscoring how investor appetite for private credit has deteriorated in the wake of the two high-profile corporate failures.

“Redemptions are up across the board,” one senior private credit executive told the FT.

The asset class has been tarnished by the failures of First Brands and Tricolor, despite those companies largely financing themselves through loans and asset-backed securities provided or organised by banks.

Comments from JPMorgan Chase chief executive Jamie Dimon, who last year warned that “when you see one cockroach, there are probably more” after Tricolor’s failure, have added to the investor unease.

“I think there is a lot of fear in the air and time will tell if those fears are well founded,” said Philip Hasbrouck, the co-head of Cliffwater’s asset management business.

Senior figures in the sector also pointed to the decision by private investment firm Blue Owl to call off a merger of two of its funds, which would have inflicted losses on investors in one of the vehicles, as adding to investor angst.

“The stories in October in particular around First Brands and Tricolor were headline grabbing,” another private credit executive said.

Investor interest in the asset class had already started to wane last year as the Federal Reserve signalled it would begin to lower interest rates, reducing the returns on offer across credit markets. That prompted several major private credit funds — which invest in floating rate debt — to cut their dividends.

“There is clearly a reduced amount of demand for floating rate credit strategies given this broader theme around lower rates,” the executive added.

Investor withdrawals have hit so-called non-traded business development companies (BDCs) and interval funds, which have become the primary way that retail and high-net worth individuals invest in the $2.3tn private credit industry.

Funds have thus far agreed to meet redemption requests, including when they have exceeded quarterly thresholds that would otherwise allow a manager to limit withdrawals, typically to 5 per cent in a quarter.

Blackstone’s flagship $79bn private credit fund, the largest in the industry, had $2.1bn of redemption requests in the fourth quarter, or about 4.5 per cent of the fund. That was up from 1.8 per cent in the third quarter. Ares’ $23bn strategic income fund reported just under $600mn of withdrawals, or 5.6 per cent of the fund’s net asset value.

The $25bn BlackRock fund, known as the HPS Corporate Lending Fund, said that redemptions rose to 4.1 per cent from 1.6 per cent, or roughly $475mn in the most recent quarter.

Investors have sought to redeem 5 per cent of their shares from a $34bn Blue Owl fund known by the ticker OCIC, according to a person briefed on the matter. Redemptions from the firm’s technology-focused investment fund, in contrast, surged to roughly 15 per cent from 2.6 per cent, a top executive said last week. Seeing the rise, the firm had lifted the cap on redemptions to 19.3 per cent, allowing investors to exit.

Despite this, funds have so far continued to take in more new money than they have had to pay out, according to analysts at Barclays, including for Apollo, Ares, Blackstone, BlackRock, Barings and Oaktree.

That has limited the need to tap available liquidity or sell assets to raise capital to meet redemptions. The funds all have access to bank borrowing lines to fund withdrawals and some hold a portfolio of liquid loans that they could sell if needed.

Peter Troisi, an analyst at Barclays, said that new investments into BDCs had also slowed since August, with inflows in December down 26 per cent from the month prior, based on the handful of funds that have already reported.

Executives say they hope that the willingness of funds to meet redemption requests will bolster confidence in the private credit industry and help differentiate the asset class from real estate, which in 2022 was hard hit by the Fed’s rate hikes. Several funds imposed redemption restrictions as the value of their real estate holdings slid, including Blackstone’s mammoth fund known as Breit.

Investors are watching for signs of distress, including an uptick in defaults on private credit loans. But so far, analysts said that credit quality remained stable.

Blue Owl said performance for its technology fund had remained “strong” and that the portfolio was “well positioned and with leverage below target, we maintain substantial liquidity for investments and obligations”.

Ares in December told clients in its fund that its investments remained “healthy” and that it would commit to maintaining its dividend through June. Blackstone said that “investors continue to recognise the premium private credit can offer versus public fixed income”.

Cliffwater’s Hasbrouck said the firm was “not worried about our ability to perform, knowing that we have a lot of liquidity behind us and we think quarter on quarter things will get better.”

BlackRock and Oaktree declined to comment.

Brazil and US eye rare earths deal

Abundant but largely untapped rare earth deposits could offer leverage as diplomatic ties improve

Brazil’s abundant but largely untapped rare earth deposits are drawing interest from the US, with Brasília eyeing the minerals as a potential bargaining chip as it repairs diplomatic ties with Washington.

The South American country holds the world’s second-largest reserves of the elements, which are vital for cutting-edge technologies from electric cars and drones to laser-guided missiles, but whose mining and processing are dominated by China.

Washington has been seeking alternative sources after Beijing restricted exports in reaction to President Donald Trump’s trade tariffs, and sees Brazil as a potential partner, said several people with knowledge of the situation. 

Following a tentative rapprochement between Trump and his Brazilian counterpart, leftwinger Luiz Inácio Lula da Silva, diplomats and lobbyists see a chance for a rare earths accord.

“There’s nothing but opportunity here,” said one official. “Brazil’s government is open to a deal on critical minerals.”

Last year, the US intensified efforts to secure supplies of varying critical minerals — including rare earths — from outside China, striking deals with countries including Australia and the Democratic Republic of Congo.

The Trump administration’s thirst for South American natural resources was dramatically displayed by its military swoop this month to remove the leader of oil-rich Venezuela.

But it faces competition in Brazil: in Rio de Janeiro last week, European Commission President Ursula von der Leyen said Brussels was in talks with Brasília for an agreement on critical raw materials, with a view to joint investments in lithium, nickel and rare earths.

Rare earths are a group of 17 metallic elements that are complex to mine and refine. Some, including neodymium and praseodymium, are used in permanent magnets within products from smartphones to wind turbines and MRI scanners. China especially dominates production of so-called “heavy” rare earths, which are difficult to source elsewhere.

However, the development of these resources in Latin America’s biggest economy has been held back by a lack of local funding and bureaucratic hurdles.

Political analysts see a favourable moment for co-operation with the US. A diplomatic crisis erupted last year after the White House imposed heavy trade tariffs on Brasília and sanctioned officials in a bid to get a criminal case dropped against ex-president Jair Bolsonaro, a rightwing ally of Trump.

But Lula stood firm, and Bolsonaro was convicted of plotting a coup. A détente then began, with meetings and calls between Trump and Lula, as bilateral trade negotiations got under way.

The US has since reversed some tariffs on Brazilian foodstuffs and cancelled sanctions on the supreme court justice who oversaw Bolsonaro’s prosecution.

Talks on rare earths were at an initial stage by late 2025, said people with knowledge of the situation, with the US signalling its interest in private.

America’s top diplomat in the country, chargé d’affaires Gabriel Escobar, has spoken about rare earths with Brazil’s mining industry association, Ibram, and companies exploring prospects there in recent months. 

The US Department of Commerce and Brazilian trade ministry have also discussed critical minerals, said a person familiar with the matter. 

An event in Washington about critical minerals in December, with rare earths as a central focus, brought together representatives from both governments, financial institutions, industry and investors. 

A Brazilian congressman preparing a bill on the subject, Arnaldo Jardim, attended and met with commerce department officials, said a person with knowledge of the matter. Jardim declined to comment.

“There were people from the departments of commerce, state, defence and energy, two or three representatives from each,” said one attendee. “They were very interested and said they are making agreements with other Latin American countries regarding rare earths.”

The US-Brazil thaw may be tested by tensions between the two, such as Brasilia’s condemnation of the attack on Caracas and Lula’s veto of legislation reducing Bolsonaro’s sentence.

Christopher Garman, of political risk consultancy Eurasia, said he expected a US-Brazil agreement on critical minerals soon. “We’ve got like a 75 per cent odds of some kind of a deal occurring by Q1.”

For the US, “there’s a massive priority on tackling critical minerals and rare earths because that’s the biggest miscalculation that Trump’s administration had over the entire mandate, the relationship with China, and he wants a deal”, he said.

For both countries “it’s a win-win”, he added. “The timing of a deal may be delayed due to diplomatic tensions on Venezuela, but won’t derail it.”

The US is prepared to channel funding for rare earths ventures in Brazil via public lenders the International Development Finance Corporation (DFC) and Export-Import Bank, as well as support through government departments, said people briefed on the matter.  

Washington is already backing some. The DFC approved a $465mn loan in August for Serra Verde, Brazil’s only operational rare earths mine, in Goias state. Much of its output was initially sold upfront to China, but that contract is due to expire this year. 

China controls about 60 per cent of global rare earths extraction but has more than 90 per cent of processing capacity. Brazil holds 23 per cent of world reserves, according to the US Geological Survey.

Constantine Karayannopoulos, an industry veteran and adviser, said this “extraordinary endowment” could make it a “rare earth superpower”. “If the White House wants to play its cards right they’ll take a more pragmatic and rational approach, rather than forcing [Brazil] into doing things,” he added.

A US-Australia framework on critical minerals and rare earths agreed in October, outlining $3bn of investments over six months, offers a template for any pact between Washington and Brasília.

The DFC has also provided $5mn to fund a feasibility study for another heavy rare earths project under development in Goias by Aclara Resources. Chief executive Ramón Barúa said it hopes to begin production by mid-2028, aiming to sell to western rather than Chinese customers.

“The reception has been amazing,” Barúa said of its engagement with various US government departments. “They are clearly interested.”

Only 30 per cent of Brazil’s territory has been properly mapped for mineralogy, said Valdir Silveira, a director at the Geological Survey of Brazil, so its rare earths deposits could be larger than thought. Yet projects in the country face long waits for permits. The Serra Verde mine took 15 years to enter production.

Brazil’s trade ministry said: “Debate on co-operation in the area of ​​rare earths is part of the economic dialogue between Brazil and the US.”

The White House did not respond to a request for comment.

Demand drop leaves drinks makers with lake of unsold spirits

Groups are halting production and cutting prices to shift stock as sales declines accelerate in key markets

A historic downturn in demand for scotch, whiskey, cognac and tequila has left drinks makers sitting on a lake of unsold spirits, forcing them to mothball distilleries and slash prices to shift bottles piling up in warehouses.

Five of the biggest listed alcohol producers — Diageo, Pernod Ricard, Campari, Brown Forman and Rémy Cointreau — are sitting on $22bn worth of ageing spirits, the highest level of inventory in more than a decade, according to their financial reports.

In the most extreme case, French cognac maker Rémy’s €1.8bn ($2.1bn) of maturing inventory is now almost double its annual revenues and close to its entire market capitalisation.

The pileup of stock is exacerbating drinks makers’ debt burdens and threatening to lead to a price war.

“The build-up of inventories is unprecedented,” said Bernstein analyst Trevor Stirling, adding that among the companies to disclose the information, current stockpiles had surpassed those amassed in the wake of the global financial crisis.

Diageo’s maturing inventories as a share of annual revenues have jumped from 34 per cent in its 2022 financial year to 43 per cent in 2025. The value of the FTSE 100 group’s ageing stock, predominantly American whiskey and Scotch, had reached $8.6bn as of June last year.

Casks of ageing spirits began to pile up after companies reacted to a pandemic-era boom in drinking by dramatically increasing production.

“In 2021 and 2022 everyone lost the run of themselves and thought [demand] would go on like that forever,” said Stirling. 

Soaring inflation ultimately brought the industry back down to earth. A global squeeze on disposable incomes over the past few years has sapped demand for spirits, triggering a series of profit warnings, leadership changes and a shareholder exodus from the sector’s largest names.

Investors have been debating the extent to which the downturn is being driven by more profound societal changes. Some argue that moderating alcohol consumption is primarily linked to the rapid adoption of weight-loss drugs such as Wegovy and Ozempic, allied to a greater focus on health and wellbeing generally.

Volatility is challenging for manufacturers of ageing spirits, which have to forecast demand years in advance.

Cognac makers, for example, must decide how many litres of eau-de-vie, the grape-based spirit which is aged to make cognac, to pour into casks for two, four, 10 or 12 years in the future — the main cognac age profiles.

Sales of the French brandy have been hit particularly hard in the downturn, with exports down 72 per cent year on year in February 2025, according to the Bureau National Interprofessionnel du Cognac (BNIC), a trade body.

China imposed a 34.9 per cent duty on European cognac last year, amid trade tensions with the EU, but exempted Pernod Ricard, LVMH and Rémy Cointreau if they agreed to sell at a minimum price.

At Rémy Cointreau’s half-year trading update in November, where it reported a 7.6 per cent drop in organic cognac revenues, chief executive Franck Marilly suggested that elevated supplies of eau-de-vie meant prices would have to fall.

“We’re in a different world,” Marilly said. During the pandemic LVMH’s Hennessy cognac was priced as high as $45 a bottle in the US but has since been reduced to as low as $35.

The tequila boom of the past decade — fuelled by new brands fronted by the likes of George Clooney, Dwayne ‘The Rock’ Johnson and Kendall Jenner — led producers including Diageo and Brown Forman to spend millions of dollars adding new production capacity.

But as soon as the new facilities were up and running, demand slumped. The FT previously reported that in December 2024 Mexico was sitting on more than half a billion litres of tequila in inventory, almost as much as its annual production.

In the US meanwhile sales of spirits from Don Julio tequila to Jameson Irish whiskey are going from bad to worse. Total spirits sales fell by 3.4 per cent in the four weeks to the end of December, compared with a 2.4 per cent drop over the previous four weeks, according to data from Nielsen.

Analysts said producers had so far resisted the kind of deep discounting that gripped the industry during previous spirits “lakes”, such as the so-called whisky loch of the 1980s. But the heavy investments made into production and storage are weighing heavy on company balance sheets.

Diageo’s leverage is currently 3.4 times its adjusted earnings before interest, tax, depreciation and amortisation, well ahead of its target of less than three times. Pernod’s leverage is 3.3 times earnings, significantly above its historical level of 2.5 to 2.9 times.

Manufacturers have halted production while they try to sell off existing vintages. Japanese drinks group Suntory has closed its main distillery for Jim Beam bourbon, based in Kentucky, for at least a year. Diageo meanwhile has halted whiskey production at its Texas and Tennessee facilities until the summer.

Jefferies analyst Edward Mundy said cutting production of ageing spirits was a risky game, as it could leave producers short of stock in five or even ten year’s time, when demand for a particular brand or category might have reignited. 

“If you cut inventory during a downturn, you have huge problems when you’re trying to satisfy demand in the future,” said Mundy, adding that the spirits boom and bust of the past five years was near impossible to predict.

“Ultimately there’s an element of human judgment,” he said. “[But] you just don’t know what demand will look like in five years’ time.” 

Can India be luxury’s next big thing?

Slowing demand in China has pushed brands to seek pockets of growth in new markets

At a heated polo game in New Delhi — a contest between India and Argentina billed as the “match of the century” — fashion executive Adrian Simonetti explained why he believed India had the potential to be a strong luxury market.

“Luxury in India is no longer about labels, it is about belonging to a global lifestyle,” said Simonetti, co-founder and chief executive of La Martina, a high-end leisure sports and polo gear brand headquartered in Argentina.

“There is a new generation with international exposure, strong purchasing power and a deep appetite for brands that carry authenticity,” he said.

The Argentine retailer is part of a wave of brands searching for growth in India as demand slows in China — which before the Covid-19 pandemic accounted for a quarter of global luxury demand — as a result of a cooling economy and shifting consumer tastes.

But India remains difficult to develop due to logistical challenges, a lack of luxury shopping malls and the tendency of wealthy Indians to travel to Dubai, Singapore or countries in Europe to shop, according to industry experts. High customs duties and bureaucracy have also slowed growth.

Luxury sales across all emerging markets — spanning Latin America, the Middle East, south-east Asia including India, and Africa — are equivalent to the €40bn to €45bn in sales China is expected to have generated in 2025, according to consultancy Bain & Co.

Louis Vuitton, luxury’s biggest brand with more than €20bn in annual turnover, has three boutiques in India, whereas it has dozens in cities across China. Industry experts have described domestic demand in India as “nascent”.

But despite the hurdles, brands see opportunities for growth in India in its growing ranks of millionaires. Groups including L’Oréal and Estée Lauder, which first began selling products in India in 2005, are expanding in the country.

India can “become a bigger contributor in the growth algorithm of the company”, Estée Lauder’s chief executive Stéphane de La Faverie told the Financial Times in October.

Last year, Stella McCartney’s fashion label became the latest addition to a roster of luxury names, including Burberry, Emporio Armani and Versace, brought into the country through a partnership with Reliance Industries, the conglomerate run by Asia’s richest man, Mukesh Ambani.

French upmarket department store Galeries Lafayette opened its first India outlet in Mumbai in October. Kumar Birla, the billionaire chair of the Aditya Birla Group, which helped bring the store to India, described the partnership as “a coming-of-age moment for Indian luxury retail”.

India ranks among the world’s five fastest-growing luxury markets with a current value of $12bn, according to Euromonitor International.

“India’s trajectory is steeper than most regional peers, supported by rising affluence, expanding retail infrastructure and increasing interest in wellness and experience-led luxury,” said Pallavi Arora, senior analyst at Euromonitor.

India’s high import taxes have been a drag on luxury sales in the country. Taxes on items often exceed 20 per cent, alongside domestic goods and services tax rates of up to 40 per cent, said analysts.

New Delhi has traditionally imposed high import duties, earning it the moniker of “tariff king” from US President Donald Trump, who in August slammed the country with a 50 per cent levy. Under some of the proposed trade deals still being negotiated with the US and EU, tariffs on imported goods could fall, potentially reducing prices.

“Many Indians still prefer to buy luxury goods abroad because prices are lower and product choices are wider,” said Euromonitor’s Arora.

Victor Graf Dijon von Monteton, partner at consultancy firm Kearney, said strong growth in India was far from offsetting the weakness in China.

“The baseline is so much higher in China,” von Monteton said, noting that 4 to 5 per cent growth in China’s luxury market would bring more additional revenue than India in its entirety. He noted that China’s luxury market took about 20 years to mature and India was only halfway along that journey.

One Mumbai-based billionaire told the FT they were sceptical luxury would truly take off, pointing to empty marble-floored malls in Mumbai with many wealthy Indians still preferring to shop during trips to Dubai, Singapore, London and Paris.

The billionaire noted that the pool of consumers with disposable income for luxury purchases remains small, with the country’s GDP per capita at about $3,000 in contrast with China’s $13,810, according to the IMF.

Reliance Retail’s foreign brands division lost about $30mn in the past financial year, according to the company’s last annual results up to March 2025.

“Limited scale, high overheads and regulatory hurdles keep many joint ventures unprofitable,” said Ankit Yadav, engagement manager at Redseer Strategy Consultants, an advisory firm.

“High rentals and the scarcity of grade-A mall infrastructure continue to be major constraints for luxury retail expansion beyond [main cities].”

India’s demand for more “accessible” luxury has prompted many brands to launch “smaller-ticket products and limited-edition collections priced 50 to 70 per cent below flagship offerings to engage aspirational consumers”, Yadav added.

For now, von Monteton said Kearney was advising clients to invest in India because “if you’re coming in at a later stage, you’re probably not going to win over the Indian consumer”.

That is advice that Simonetti is fully on board with as he sat among New Delhi’s elite at the polo field. La Martina has 15 stores in the country in partnership with Reliance and has plans to open 11 more by March.

“Polo already resonates strongly with India’s elite sporting culture,” said Simonetti.

“We are also in south-east Asia and in China, but with smaller operations,” he said, “India is something else.”

Lobbyists want to see legislation passed while Republicans still have control of Congress

Big crypto players have turned against a landmark bill to regulate digital assets, which industry lobbyists had been pushing in a rush to pass a favourable rule book before the midterm elections.

The bill known as the Clarity Act, a sweeping piece of legislation to govern the multibillion-dollar US crypto sector, was delayed in the Senate this week after Coinbase chief executive Brian Armstrong publicly withdrew his support.

Infighting over the legislation, a version of which passed the House of Representatives in July with support from crypto lobbyists, imperils an effort to move the bill through the Senate before lawmakers turn their attention to this autumn’s congressional elections.

“There’s definitely an assumption that crypto is not going to have a friendly Congress post-midterms,” said Gabe Rosenberg, partner at law firm Davis Polk. “This is the shot.”

Discontent around the legislation marks the first big political setback for the American crypto industry since Donald Trump returned to the White House.

His administration has made crypto a national priority and sought to implement crypto-friendly regulations, as well as pardoning well-known crypto figures and signing the so-called Genius Act to regulate stablecoins.

The Clarity Act introduces a sweeping regulatory framework for digital assets, ranging from bitcoin to obscure derivatives, and determines which agency among the country’s securities and commodities regulators should have oversight.

Crypto companies have had to battle bank lobbyists over the bill, with the main dispute relating to the rewards that are paid to people who own stablecoins, digital tokens pegged to the US dollar. 

Banks have fought to limit those rewards — arguing that allowing individuals to earn more interest on dollar-linked tokens than they do in their bank accounts will lead to “deposit flight” and dent lending.

Bank of America chief executive Brian Moynihan, on an earnings call this week, said a movement of funds out of the traditional banking system would “reduce lending capacity of banks, [which would] particularly hurt small and medium-sized businesses” compared to larger borrowers that have access to other sources of debt.

US banks were “spending a lot of money in DC” lobbying to stop crypto companies from being able to pay interest, said Geoff Kendrick, global head of digital assets research at Standard Chartered, adding that the banks “know they’re in trouble” when it comes to competition.

Tokens that represent ownership of stocks are another point of friction, with crypto players crying foul at a last-minute addition of language that would make it harder for these assets to get permission to trade.

Jonathan Jachym, global head of policy and government relations at crypto exchange Kraken, said the changes “created some unnecessary frictions and distraction”.

Meanwhile, decentralised finance groups are fighting against politicians and more traditional market makers over obligations related to anti-money laundering and other controls. They argue these rules would make it more difficult for software developers to build crypto systems that do not have centralised oversight, hampering innovation.

These disputes contributed to Coinbase’s last-minute change of heart and led to a Senate committee review, known as mark-up, being called off the night before it was due to proceed.

“There’s a lot of forces at play here, and that was coming together at the last second for a bill that was still being negotiated hours before the mark-up itself,” said Ron Hammond, the head of policy and advocacy at Wintermute.

Democratic politicians have been pushing for limits on public officials profiting off ties to crypto businesses — a move that partly targets the Trump family’s extensive crypto interests.

Crypto lobbyists fear that if Democrats gain seats after the midterms in November, or take control of either chamber of Congress, the digital asset sector will face a much more sceptical environment.

The fate of the nearly 300-page bill is uncertain as the Senate is on recess and no deadline has been set for another committee vote.

“It’s still got momentum, and that’s the main killer or driver here,” said Hammond. “The second this bill loses momentum politically, I would consider it dead in the water, but right now, it’s got a lot of momentum from all those outside pressures, including the White House.”

KKR just released an 88 page report on their 2026 outlook for public and private markets

--> Have a look : https://x.com/BoringBiz_/status/2012531683484934157?s=20

Mid-cap companies are often overlooked by investors, who either stick with large-cap companies or look to small-cap names if they want to diversify. But 2026 may be the year mid-caps come out of the shadows.

Several factors are coming together that could make this year an exciting time for the stock market’s middle child, say Don Peters and Dante Pearson, managers of the $4.4 billion T. Rowe Price Diversified Mid Cap Growth fund.

Compared with large-cap companies, mid-caps generally need more money to grow, so as the Federal Reserve continues its easing cycle, midsize companies often receive an outsize benefit from lowered borrowing costs. The outlook for earnings growth is strong for 2026, and companies that are going public now are often listing as mid-caps—instead of small-caps—having stayed private for longer. Finally, mergers and acquisitions activity could increase because of an accommodating regulatory environment, further giving mid-caps a boost.

Unlike more-volatile small-cap companies still gaining their footing, or large-cap companies unlikely to experience rapid growth, the best mid-cap companies are transforming into higher-margin, higher-return-on-capital businesses. But only about 15 sell-side analysts on average cover mid-cap companies, so many good ones are growing unnoticed, the fund’s managers say.

“That’s one of the many benefits that we appreciate in mid-cap investing,” Pearson says.

Morningstar gives Mid Cap Growth five stars and a silver medal, which means the firm has a high conviction the fund will outperform its index and its peers over a full market cycle on a risk-adjusted basis. The no-load fund charges annual fees of 0.84%, which Morningstar calls below average.

The fund beats its peers across short- and long-term time frames. It has a 14% 10-year annualized return versus peers’ return of 12.1%, putting it in the top 10% of mid-cap growth funds. Mid Cap Growth also beats the Russell Mid Cap Growth index’s 10-year return of 13.3%, net of fees.

Peters has run the fund since its 2003 inception, and Pearson has worked with Peters since joining T. Rowe in 2017, first as an analyst; he was officially named associate portfolio manager in 2024. At the end of December, Pearson will take over as lead portfolio manager, and Peters will leave the fund after a transition. Peters will continue to manage the $1.4 billion T. Rowe Price Tax-Efficient Equity fund. “It will be the most uneventful transition on record because we’ve worked together for years,” Pearson says. “Consistency is the approach.”

The duo seeks steady, long-term outperformance through disciplined stock selection, rather than by timing the market or making big sector bets.

“We want to have companies that we think will grow up to become larger and successful,” says Peters. “Successful companies are good capital allocators, have management teams that execute well, and aren’t overvalued.”

They rely on T. Rowe analysts’ bottom-up fundamental research to find companies trading at discounts relative to their history and that show signs Wall Street is underestimating long-term revenue growth. Peters and Pearson have found over the years that, more than any other metric, the strength of analysts’ expectations is key to how well stocks will perform.

“Nothing always works, but when good news is happening to companies, when numbers are moving up, your hit rate goes up substantially. That’s our focus more than any specific style or [metric],” Pearson says.

They also have sharp risk controls. Every six months they review all their investments, looking at corporate debt levels and revisiting portfolio positioning to map out how each holding correlates with other investments and to estimate how each name would perform during bearish market extremes. Peters says they consider risk management as a contributor to their excess return.

Peters and Pearson let their winners ride to take advantage of compounding, but they will gradually sell when mid-caps graduate to large-caps, using the Russell Mid Cap benchmark cutoff as their guide.

One of the bigger mid-cap names they own is No. 1 holding Howmet Aerospace, which they first bought in 2022. The specialty-parts manufacturer of aerospace components contributed handsomely to last year’s strong performance. It is currently trading at 47 times 12-month forward earnings, which Peters says is somewhat expensive, but it boasts consensus estimates of 23.8% on long-term revenue growth over three to five years.

Mid Cap Growth bought luxury-goods company Ralph Lauren this past summer, and the duo are impressed with how management continues to nurture the brand. It trades at 21.7 times 12-month forward earnings, and long-term revenue growth is estimated at 13.5%.

“They’re playing the long game and are cheaper than the traditional European luxury companies,” Peters says, also pointing out that Ralph Lauren isn’t overly dependent on any one region for growth, unlike some peers that were overexposed to Chinese consumers when that economy softened.

Two purchases in the past 12 months demonstrate how Peters and Pearson think about portfolio composition to keep their roughly 245 holdings diversified.

They bought Encompass Health, the dominant player in the patient rehabilitation hospital market, in June 2024. They expect it to benefit from demographic demand as baby boomers and Gen Xers need services such as joint replacements and have major medical events such as strokes. Costs for these services are cheaper at hospitals like Encompass, Peters says. The stock trades at 18.2 times 12-month forward earnings, with long-term growth estimates around 14.4%. They expect this lesser-known company will be a solid compounder.

Peters and Pearson are impressed by the way Colleen Keating, the relatively new CEO of Planet Fitness, seems to be turning around the company. She was brought on in June 2024, and the duo bought the low-cost gym franchise a month later, with an eye on the trend of healthy living.

“It’s easy to join and quit, so it’s not a roach motel for customers,” Peters says, noting that it trades at 29.2 times 12-month forward earnings, with growth estimates at 15.6%.

Mid Cap Growth’s portfolio is intentionally structured to prevent a few holdings from dominating returns. That diversity also helps the portfolio perform in various economic environments, the duo says. With its focus on valuation, the fund tends to lag behind its peers when market leadership is driven by speculative or risk-seeking markets, or when markets are driven strongly by momentum.

While they see 2026 as being a good year for mid-caps, Peters and Pearson don’t take views on the economy, market direction, or other macroeconomic calls as they look for potential new holdings.

“We generally just try to find low-cost producers that have good capital allocation,” Peters says.