FT : China extends travel restrictions in effort to contain coronavirus

China extends travel restrictions in effort to contain coronavirus
Hospitals in Wuhan overwhelmed and cases confirmed in US and across east Asia

China has expanded travel restrictions from Wuhan to at least two nearby cities, as authorities battle to contain a viral outbreak that has overwhelmed local hospitals and sparked global alarm.

In Wuhan, a city of more than 10m people where the coronavirus is believed to have originated, all public transport in and out of the city was closed on Thursday morning ahead of the lunar new year holiday, when hundreds of millions typically travel across the country.

The authorities later extended similar restrictions to Huanggang city, south-east of Wuhan, where residents were told not to leave without a special reason, according to an announcement on a city government website. In nearby Ezhou, trains were stopped from leaving or entering the city. 

The lockdown in Wuhan to curb the outbreak — China’s worst since the Sars epidemic 17 years ago — coincided with an announcement that Beijing was cancelling large public events, including lunar new year celebrations, because of the coronavirus. Beijing’s Forbidden City, one of China’s biggest tourist attractions, said it would close until further notice.

During the 2003 Sars outbreak, thousands of people in Beijing were quarantined in their homes, but a city-level travel ban was not imposed. 

The coronavirus outbreak has officially killed 18 people in China and infected more than 630. State television on Thursday reported three new cases in the north-west Shaanxi province.

China’s state broadcaster CCTV reported doctors in Wuhan as saying that there were too many people presenting at hospitals with fevers and they were unable to treat them all. Late on Thursday China’s finance ministry allocated Rmb1bn ($144m) to Hubei province, where Wuhan is located, to help control the virus.

Cases have also been confirmed in the US, Japan, South Korea, Thailand, Macau, Taiwan, Singapore and Hong Kong.

At least three people were being tested for the virus in the UK after arriving on flights from Wuhan. A UK government official said information flows with the Chinese authorities were not as open as the UK might like and that they were liaising with the World Health Organization. Matt Hancock, UK health secretary, said there was an “increased likelihood” cases might arise in Britain but “we are well-prepared and well-equipped to deal with them”.

Speaking at the World Economic Forum in Davos, Jeremy Farrar, director of the Wellcome Trust and a former professor of tropical medicine at Oxford university, said he believed the coronavirus started in animals, probably bats, in Wuhan’s market.

Subsequent human-to-human transmission “will make it very difficult to bring the virus under control”, he explained, particularly because it was likely to proliferate due to the huge number of people on the move for the lunar new year.

“We can expect many more cases in China,” he said, adding that he expected the virus to continue to spread. “This is now a global issue,” he concluded.

Residents of Hong Kong, which was hit hard during the Sars outbreak, rushed to buy face masks as news broke of the city’s first confirmed case on Wednesday. One pharmacy said it had sold out of its latest order of 200 boxes of masks within half an hour. Hong Kong authorities confirmed a second case in the city on Thursday.

Taiwan stepped up its border control measures. Chinese citizens who were Wuhan residents would be blocked from entering Taiwan with immediate effect, said Chen Shih-chung, health minister. In addition, daily monitoring of people with respiratory symptoms has been broadened from recent arrivals from Wuhan to travellers from anywhere in China, including Hong Kong and Macau.

Singapore’s health ministry confirmed the city-state’s first coronavirus case, a 66-year-old Wuhan man who travelled there from China this week. Two other suspected cases, both from Wuhan, had been identified. Preventive measures at land and sea checkpoints had been stepped up, the ministry added.

China’s benchmark CSI 300 index closed 3.1 per cent lower, marking its worst one-day performance for several months. In Hong Kong, Macau casino operators were among the big fallers with SJM Holdings down 4.5 per cent and Galaxy Entertainment dropping 3.5 per cent.

The World Health Organization was later on Thursday set to meet in Geneva to decide whether to declare a global emergency over the outbreak. If it goes ahead with such a measure, it would be only the sixth time in the past decade.

In Wuhan, some residents said they had attempted to leave before the ban was implemented but were unable to do so. “I heard about the train cancellations in the middle of the night, but came to the station anyway in case I could change my ticket. It looks like that is not possible,” said Li Lei, 24. Private transport by road was still allowed.

Another Wuhan resident said her 57-year-old mother had been experiencing symptoms of the virus for a week but was turned away from several hospitals. “When we arrived at the hospital in the morning, staff said the pulmonology department was closed after four doctors had been diagnosed with coronavirus,” said the person, who asked not to be named.

Beijing is under mounting pressure to prevent a repeat of the Sars crisis, when nearly 800 people died. The reaction this time has been considered somewhat better. While the Sars virus was thought to have emerged in late 2002 it was only reported officially in February 2003 — a delay that gave it more time to spread.

Chinese internet users took to social media to discuss how authorities were handling the outbreak, commenting on the rapid response from the Hong Kong government and condemning the lack of transparency and openness from mainland authorities.

The People’s Daily, the official Chinese Communist party mouthpiece, reported the outbreak far down on its homepage on Thursday, below news about President Xi Jinping wishing the Chinese people a happy new year. A report on the virus appeared more than 30 minutes into state television’s nightly news show the previous day.

>>> MAKOR INGENICO 2020 REPORT


Ingenico (ING FP): Fundamentals & Speculative - There is no Taboo – In GENIOUS Co.

 

Following horrible FY2018 during which INGENICO issued 3 profit warnings making the company market capitalisation divided by 2, early 2019 the Board has reshuffled the management with the departure of Mr Lazare and has decided to separate the functions of Chariman and CEO. Mr B.Bourigeaud (Founder of Atos) has been appointed Chairman of the Board and Mr N. Huss(former Visa Europe CEO before being bought by Visa Inc.) has been appointed CEO. We would add as other top managers Ms J.Miles, ex N.2 at Verifone after being bought by Francisco Partners, that has a deep knowledge of Ingenico main competitors and North America markets; Mr J.Tjarnberg, ex Bambora CEO and Point Group being bought by Verifone and Mr N.Santschi, ex CEO of BSPAyone after the JV made by Ingenico and ex CEO of Six Payment Services after being bought by Worldline.

Last Spring 2019, during its Capital market Day, the management has presented the “Fit for Growth” strategy aiming at reinforcing/restructuring Ingenico into 2 business units : Banks & Acquirors (mainly Terminals) and Retail (payment solutions/services). Over the 2019 year, Ingenico share price performance (up 95%) has clearly highlighted the good performance of the company that translated in its Q3 2019 results’ presentation to slightly upgrade its FY 2019 targeted revenues and EBITDA. Since January 1st  2020, the 2 BU are now reporting indepently suggesting a possible spin-off / sale of the B&A division or full sale to a potential acquiror (During the 2018 “crisis”, Natixis Payment was rumored to be interested by the Retail division to strengthen its position in the sector.

Despite its tremendous share price performance, Ingenico is still laging peers in the sector that has experienced a major wave of consolidation : Verifone bought by Francisco partners for x11.2 EV/EBITDA, Vantiv/Fiserve/Worldpay, Nets by Hellman & Friedman, Paysafe by CVC/Blackstone…

 

CONCLUSION: The split into 2 Reporting independent business units will highlight the growth potential of the Retail Unit. Ahead of Ingenico FY 19 results to be published on February 25th, we would highlight investors that  our base case valuation would stands in the EUR115/120 range. Applying peers multiple would give a EUR130/135 target price and our Blue sky scenario (applying precedent multiples‘ transactions with a premium due to Ingenico leadership position eg x12 EV/EBITDA for B&A and x15 EV/EBITDA for retail) could see Ingenico reach the EUR165 price. All in all, we think that the potential upside stands in the range of 20 to 40%and would therefore recommend investors to initiate a position.

 

 

>>> US Gapping down

 Gapping down
In reaction to disappointing earnings/guidance
:

  • VFC -4.8%, PRA -4.2% (reports preliminary loss estimates; sees $37 mln of adverse development in Specialty Property & Casualty segment), RJF -4.2%, WBS -3.1%, FUL -2.8%, TCBI -2.6%, HBAN -1.9%, TRV -1.8%, PG -1.7%, TXN -1.1%, AAL -1%, CADE -0.9%, LUV -0.9%

Other news:

  • KRTX -13.7% (still looking around for catalyst)
  • AUTL -11.8% (prices offering of 7.25 mln ADSs at $11.00 per ADS)
  • IMGN -7.3% (prices offering of 21.325 mln shares of common stock at $4.25 per share)
  • ZYME -5.6% (announces pricing of $279.0 mln public offering)
  • ACRE -3.6% (prices underwritten public offering of 4,000,000 shares of common stock for total estimated gross proceeds of approximately $64.4 mln)
  • NK -3.6% (modestly pulling back from today's 15% move higher)
  • MSON -2.9% (commences underwritten public offering of its common stock)
  • XENE -2% (prices offering of 3.75 mln shares of common stock at $16.00 per share)
  • MGY -1.2% (downgraded to Neutral at Credit Suisse)

Analyst comments:

  • TSLA -1.8% (downgraded to Neutral from Outperform at Exane BNP Paribas)
  • ALTR -1.4% (downgraded to Sell from Neutral at Guggenheim)
  • W -1.2% (downgraded to Hold from Buy at Loop Capital)
  • COP -1% (downgraded to Sector Perform from Sector Outperform at Scotiabank)
  • DLTR -0.9% (downgraded to Neutral from Buy at BofA/Merrill)
  • BJ -0.7% (downgraded to Neutral from Buy at BofA/Merrill)
  • ORLY -0.7% (downgraded to Underweight from Neutral at Atlantic Equities)
  • XOM -0.5% (downgraded to Sector Underperform from Sector Perform at Scotiabank)

>>> US Gapping up

Gapping up
In reaction to earnings/guidance
:

  • HZO +30.1%, SLM +22.1%, TER +9.2%, PTC +8.8%, STM +7.2%, CTXS +4.3%, STLD +4%, BANC +3.6%, JBLU +3.1%, MTB +2.4%, CMCSA +2.1%, KMI +1.2%, UMPQ +0.8%, KMB +0.8%

Other news:

  • EYE +8.4% (amended Walmart management & services agreement adding new vision centers)
  • PCG +4.9% (reaches agreement with ad hoc noteholder committee; to support PG&E's plan of reorganization)
  • PAYC +4.5% (to join S&P 500)
  • BHVN +2.1% (Biohaven Pharmaceutical collaborators receive FDA approval to proceed with clinical investigation of verdiperstat in ALS)
  • ELAN +1.1% (priced its previously announced concurrent public offerings of 22,694,732 shares of its common stock at $32.00/share)

Analyst comments:

  • LB +4.7% (upgraded to Overweight from Underweight at Barclays)
  • WDC +3.3% (upgraded to Overweight from Equal-Weight at Morgan Stanley)
  • GE +2.3% (upgraded to Overweight from Equal-Weight at Morgan Stanley)
  • ASC +2% (upgraded to Buy from Hold at Stifel)
  • MU +1.9% (upgraded to Overweight from Equal-Weight at Morgan Stanley)
  • SAN +1% (upgraded to Buy from Neutral at UBS)

>>> Ex-UBS dealer Kweku Adoboli is now trying it in Ghana

Ex-UBS dealer Kweku Adoboli is now trying it in Ghana

The trader Kweku Adoboli became famous for giving UBS a billion dollar loss. Now he is aiming for a comeback in Ghana.

Kweku Adoboli, the former UBS Group AG trader, had been fighting a deportation from the UK to his native country after he was convicted of losing $ 2.3 billion to the Swiss bank. Now he's aiming to make a comeback in Ghana with a plan to boost the mortgage-backed bond market there.

The 39-year-old was extradited to the West African country in November 2018 after being detained in 2012. The first nine months he spent mostly indoors as he struggled with depression. The support of family and friends helped him to give up the desire to return to England, where he had lived since he was 12 years old. He finally managed to make peace with a new life in Tema, a port city east of the capital Accra.

Today Adoboli speaks - albeit with a British accent - as if he had never set foot from Ghana when he talked about the gaps in the country's mortgage financing market.

"Our job is now to find ways to expand banks' balance sheets and create a mortgage market that allows us to increase demand-side housing finance," said Adoboli during a Bloomberg interview in a lounge area Five star hotels in Accra. "What will we do in 30 years if our population doubles?"

The former banker, who left Ghana at the age of four, was convicted of covering up failed bets in a market sell-off in July and August 2011. Adoboli served around half of a seven-year prison sentence for the business and was released from prison in 2015. The case had made waves at UBS in Zurich and at the London financial center.

Small market
Adoboli estimates that the platform he plans to develop could include $ 100 million in mortgage-backed securities after the first year of operation. The banks would also be offered to join as shareholders, he said.

It won't be easy. Ghana has low mortgage lending, nascent capital markets, high interest rates and a banking sector that has just left a crisis behind. Most people buy their land with their savings and then slowly build their house, often until they retire without ever taking out a mortgage.

The government estimates that the country, where 30 million people live, lacks two million homes. Given an average economic growth of 7 percent in the past three years, the middle class is increasing. According to World Data Lab, about 9 million Ghanaians earn more than $ 11 a day. That number could increase to 14 million by 2030.

Adoboli is confident that it is possible. A study he and his business partners conducted showed that 2.5 million households can afford a $ 50,000 home loan, he said. However, he did not want to give the names of his business partners.

By bundling existing and new mortgages into securities that are then sold to investors, banks could be relieved to boost lending and expand the market.

Rapid growth
The value of home loans rose by almost 10 percent to 4.5 billion cedi (720 million euros) in the nine months to September. This is less than 1 percent of mortgages in South Africa, a five times larger economy and an active securitization market, data collected by Bloomberg shows

Adoboli is trying to raise $ 6 million from investors. This is intended to finance the company's accreditation, licensing and software for the creation of a mortgage syndication platform. He plans to open the company at a financial conference in Ghana in May.

"The long-term goal is to create a sustainable platform that allows the economy to grow," said Adoboli.

>>> US Early premarket gappers

Early premarket gappers

  • Gapping up:
    • SLM +23.2%, TER +9.6%, EYE +8.4%, PTC +8.1%, STM +6.7%, PAYC +4.4%, CTXS +4.1%, STLD +4%, BANC +3.6%, CRON +0.8%, UMPQ +0.8%, STL +0.5%
  • Gapping down:
    • KRTX -11.9%, AUTL -11.2%, IMGN -8.1%, ACRE -4.5%, PRA -4.2%, RJF -4.2%, NK -3.9%, XENE -3.5%, MSON -2.9%, TCBI -2.6%, LUV -1.8%, MGY -1.2%, FUL -0.7%, TXN -0.6%