>>> US Closing Stock Market Summary

Closing Stock Market Summary

The S&P 500 declined just 0.2% on Monday, while the Dow Jones Industrial Average (+0.04%) eked out a record close amid strength in Boeing (BA 366.96, +15.96, +4.6%) and Walgreens Boots Alliance (WBA 62.25, +3.01, +5.1%). The Nasdaq Composite lost 0.1%, and the Russell 2000 lost 0.3%. 

Boeing said it expects 737 MAX deliveries to resume in December and commercial service to resume in January. Walgreens received a leveraged buyout offer from KKR & Co. (KKR 29.26, +0.11, +0.4%), according to Bloomberg. 

The nice gain in Boeing was an influential driver not only in the Dow but also the S&P 500 industrials sector (+0.1%), which joined the real estate (+0.2%) and information technology (+0.1%) sectors in positive territory. The tech sector overcame a negative start, predominately due to Apple (AAPL 262.20, +2.06, +0.8%) extending its record run on no specific catalyst. 

Eight of the other 11 S&P 500 sectors finished in negative territory, with utilities (-0.7%), energy (-0.6%), and health care (-0.4%) underperforming the broader market. 

Despite those losses, today proved to be another resilient session considering the S&P 500 declined as much as 0.6% shortly after the open in a profit-taking trade. Some trade uncertainty and another bout of violence in the democratic protests in Hong Kong may have restrained risk sentiment.

Like past sessions, though, there still wasn't a sustained effort to sell a market trading at all-time highs. Instead, investors bought the dip to quickly pare the market's early losses. 

Separately, T-Mobile US (TMUS 79.62, -1.32, -1.6%) was a notable laggard after The Wall Street Journal reported that its CEO John Legere is in talks to become the next CEO of WeWork. Qualcomm (QCOM 91.84, -2.19, -2.3%) underperformed after the stock was downgraded to Equal-Weight from Overweight at Morgan Stanley.

The U.S. Treasury market was closed for Veterans Day and investors did not receive any economic data. The U.S. Dollar Index declined 0.1% to 98.22. WTI crude declined 0.6% to $56.88/bbl.

On Tuesday, investors will receive the NFIB Small Business Optimism Index for October.

  • Nasdaq Composite +27.6% YTD
  • S&P 500 +23.1% YTD
  • Dow Jones Industrial Average +18.7% YTD
  • Russell 2000 +18.3% YTD

FT : Germany calls on EU to tighten grip on Big Tech

Germany calls on EU to tighten grip on Big Tech
Economic affairs minister Peter Altmaier urges ‘tougher oversight’ to maintain competition

Germany has urged the EU to toughen its approach to Big Tech, as part of a wider push by Berlin to boost Europe’s “digital sovereignty”.

Peter Altmaier, Germany’s economic affairs minister, recently wrote to Margrethe Vestager, the EU’s competition chief, to call for a harder line on dominant online platforms such as Google and Facebook.

“In light of current developments in the global data and digital economy, we require tougher oversight of abusive practices in order to maintain competition,” said Mr Altmaier in a letter seen by the Financial Times.

“Specific rules of behaviour need to be imposed on market-dominating online platforms,” he said.

Mr Altmaier raised the issue of how to boost European tech at a summit in Dortmund last month, as he unveiled plans for a European cloud computing initiative, dubbed Gaia-X. Both France and Germany are keen to break the grip of US cloud computing companies, such as Amazon, Microsoft and Google.

Gaia-X would be a “competitive, safe and trustworthy data infrastructure for Europe”, said Mr Altmaier, adding that a Europe-run cloud system would “help restore our digital sovereignty” and serve as a “basis for a digital ecosystem”.

A spokesperson confirmed Mr Altmaier’s letter, saying it contained proposals “to strengthen the European economy and industry by adjusting the framework conditions for competition and state aid law.

“The goal is to counter unfair competition by state-controlled and state-subsidised companies from third countries, and to toughen up oversight of abuses by market-dominant online platforms.”

Mr Altmaier is also keen to protect the German — and by extension the European — economy from inroads by state-backed Chinese companies.

In February he unveiled an aggressive new industrial strategy that envisaged the creation of a state investment fund that would step in to pre-empt foreign takeovers of big German companies.

The strategy was designed to create “national and European champions” better able to compete with tech giants in the US and Asia and to build up German competence in critical new technologies such as AI and electric vehicles.

In his letter to Ms Vestager, he also called for changes to EU competition rules to make big M&A deals like Siemens’ planned tie-up with Alstom — which was blocked by EU authorities — much easier.

He wrote: “The global competitive situation . . . should be better taken into account in M&A cases.”

>>> Is it time for a historic paradigm shift in the Persian Gulf? Seyed Hossein

Is it time for a historic paradigm shift in the Persian Gulf?


Seyed Hossein Mousavian

ARTICLE SUMMARY
Could this be the moment for the countries in the Gulf region to realize they have a lot in common and take steps to reduce conflict?

After the recent attempt by the United Arab Emirates to reduce tensions with Tehran, Iranian President Hassan Rouhani sent a letter proposing a peace plan to heads of the Gulf Cooperation Council (Saudi Arabia, Kuwait, Qatar, the UAE, Oman and Bahrain) and Iraq.
Since the 1979 Revolution, Iran and its Arab neighbors have never been able to forge a deep and sustainably friendly relationship. In fact, they have been trying to maintain minimalist diplomatic ties with each other, viewing the status quo as the most effective mode of relations.
Over the past few years, however, the degree of hostilities between Iran and Saudi Arabia, the UAE and Bahrain has reached unprecedented levels, to the extent that observers saw prospects of military confrontation in the region.
The reasons behind the increasing tensions are worth discussing. After the Saudis waged war in Yemen starting in 2015, the UAE and Bahrain became parties to the conflict on the Saudi side, whereas Iran supported the Houthis. In 2016, Saudi authorities executed Sheikh Nimr al-Nimr — a popular Shiite cleric critical of the Saudi government — which was followed by an attack on the Saudi Embassy in Tehran by an angry mob. As a result of the attack, Saudi Arabia and Bahrain cut diplomatic ties with Iran, while the UAE reduced its diplomatic relationship. Last but not least, President Donald Trump's policy of maximum pressure against Iran was supported by US allies in the region, namely, Saudi Arabia, the UAE, Bahrain and Israel.
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While rivalry between Iran and Saudi Arabia has taken hold all over the region, including in Yemen, Lebanon, Iraq and Syria, news about improvement of diplomatic ties between the Arab states of the Persian Gulf and Israel shook Iran. Ongoing Israeli attacks on Syria and Iraq — including on Iran’s bases in these two countries — and the decision by the Trump administration to declare Jerusalem the capital of Israel and recognize the Golan Heights as part of Israel could not have come at a worse time for a Middle East experiencing mounting tensions.
With the new wave of turmoil in Beirut and Baghdad, where determined demonstrators have occupied streets for many weeks calling for the removal of the entire political class, the Middle East is desperate for a serious reconsideration of policies by all parties involved in the region. While the Israeli-Palestinian conflict remains the most vital point of contention in the Middle East, resolving rivalries among the countries around the Persian Gulf, especially Iran and Saudi Arabia, would have a substantial impact on resolving crises in Yemen, Iraq, Syria and Lebanon. But for such efforts and a reshaping of policies to be effective in the Persian Gulf, attention needs to be paid to the following points.
  • First, for the decades following the 1979 Revolution, the countries of the Gulf Cooperation Council (GCC) have been allied against Iran, which has added much to the ethnically belligerent dichotomy of Arab vs. Persian. Over the past few years, tensions between the neighboring Arab countries also increased dramatically. Greater tensions began when Saddam Hussein's regime in Iraq invaded Kuwait in 1990; more recently, a high point in hostilities between GCC countries took place when Saudi Arabia, the UAE and Bahrain cut diplomatic ties with Qatar in 2017. Thus, hostilities in the region are not just limited to Arabs vs. Persians, but also Arabs vs. Arabs. Hence the old formula to ensure peace, security, and stability is obsolete and we need a new one.
  • The second point comes as a result of the time and energy I have spent in recent years studying — in dialogue with experts of the Middle East and North Africa — both the contemporary and past history of the Arab world and its relations with Iran. It has been obvious to me that there are three main varieties of “fear of hegemony” among the smaller states in the Middle East, namely, the UAE, Qatar, Oman, Bahrain and Kuwait. The “blatant fear” is about Iranian hegemony. The “hazy fear” is about Iraqi hegemony. And the “subtle fear” is about Saudi hegemony and dominance in the region. The new model for sustainable peace and security should leave no place for anyone’s hegemony. I call this the “zero dominance and hegemony” model.
  • Third, all members of the GCC along with Iran and Iraq have complaints about the lack of respect for their sovereignty, interference in their domestic affairs and the tendency for sectarian policies to be bolstered. Therefore, the foundations of the new model for sustainable peace and security should be based on seven factors. These are non-interference; respect for national sovereignty; mutual respect; commitment to abandon sectarian and pan-nationalist policies; commitment maintaining the geographic status quo of the region; commitment to secure mutual interests among states; and commitment to collective security.
While Iran and its neighbors have both contradictory and opposing interests, they also have vital mutual interests. In fact, they share more common interests than contradictory ones. Hence, the neighboring countries must be willing to invest more on common interests rather than on those that are contradictory.
Coexistence and cooperation between the GCC, Iraq and Iran would lead to fundamental changes in the relations that Sunni Muslim communities have with their Shiite counterparts in the world of Islam. It would lead to more solidarity and brotherhood, which would then lead to better prospects of security, stability and economic development on a global scale.
In 1987, under UN Security Council Resolution 598 on the Iran-Iraq cease-fire, the council asked the secretary-general to examine measures to enhance the security and stability of the Persian Gulf in consultation with Iran, Iraq and other states of the region. This was a key task for the secretary-general, but unfortunately no efforts were made to carry out this essential mandate.
Sustainable peace and security in the Persian Gulf require a regional cooperation system similar to the Organization for Security and Co-operation in Europe. Such a system would include the six members of the GCC plus Iran and Iraq to deal with common security concerns, including terrorism, extremism, sectarianism, organized crime, asymmetric threats/warfare and drug trafficking.
This regional cooperation system should take responsibility to guarantee safe maritime passage of energy exports through the narrow Strait of Hormuz and security for a quarter of the world's international energy exports and production with stability in pricing of the region's oil and gas resources. The member states could establish a task force to deal with regional crises such as in Yemen, Syria, Iraq and Afghanistan through multilateral diplomacy and cooperation with influential foreign and regional players such as the United States, the European Union, China, Russia, Turkey, Egypt and the United Nations.
With a United States willing to reduce its presence in the region, such a regional cooperation system could facilitate a gradual withdrawal of US and other foreign military forces from the region by taking responsibility for security in the Persian Gulf region.
The time has come for a new and innovative model for peace in the Persian Gulf. Oman and Kuwait have already made good efforts toward achieving friendly relations and now the role of the UAE could be definitive. Some sources have confirmed that Tehran has received a positive response from Saudi Arabia and Bahrain to Rouhani’s letter on a peace plan with neighbors. In all of this, the UN Security Council must play a more robust role to ensure that security and peace are achieved in the region.
Found in:DEFENSE/SECURITY COOPERATION, YEMEN WAR, GCC RELATIONS, IRAN-US TENSIONS, IRAN REVOLUTION
Seyed Hossein Mousavian is a Middle East security and nuclear policy specialist at Princeton University and a former spokesman for Iran’s nuclear negotiators. He is the author of "The Iranian Nuclear Crisis: A Memoir" (2012) and “Iran and the United States: An Insider’s View on the Failed Past and the Road to Peace” (2014).


Read more: https://www.al-monitor.com/pulse/originals/2019/11/iran-gcc-reduce-tensions-rouhani-uae-saudi-bahrain.html#ixzz64yv2ZQIt

(Bus. Of Fashion) Investor Patience With Money-Losing Start-ups Wears Thin (FTCH

  • Farfetch reports quarterly results on Nov. 14
  • The online luxury marketplace’s stock has plunged by over 50 percent since reporting larger-than-expected losses in August
  • High costs are overshadowing rapid sales growth on the marketplace and at other fashion start-ups
It was only 14 months ago that Farfetch exploded onto public markets with an IPO that valued the fashion start-up at $6.2 billion. Today, the company’s market capitalisation is less than half that, amid growing concerns about how — or whether — the marketplace will eventually turn a profit. Farfetch’s situation isn’t unique; plenty of other money-losing start-ups, from Uber to WeWork, have seen their aura of invincibility punctured this year. However, Farfetch has made some moves investors find questionable, including its $675 million acquisition of brand factory New Guards Group in August. Farfetch earnings come on the heels of The RealReal’s troubles last week, where a surge in revenue and active users was overshadowed by questions about the quality of the resale platform’s much-vaunted authentication process.
The Bottom Line: Every e-commerce start-up dreams of emulating Amazon, which expanded from a bookseller to an “everything store” selling cloud computing and streaming video. As the recent turmoil at WeWork, with its distracting forays into preschools and wave pools, demonstrates, businesses need to show they can get the fundamentals right before branching out.

WSJ : Florida’s Sunshine and Tax Benefits Beckon Billionaires

Florida’s Sunshine and Tax Benefits Beckon Billionaires
Trump is joining the tradition of wealthy people abandoning New York, New Jersey and Connecticut

President Trump’s recently announced adoption of Florida as his home state over his native New York follows a rich tradition of high-profile financiers who have ditched northeastern states for warmer climes with lower taxes.

David Tepper, Paul Tudor Jones and Barry Sternlicht are among the prominent transplants who have pulled up roots in New York, New Jersey or Connecticut in recent years for Florida. New Yorker Carl Icahn has said he is moving his company to Miami next year.

“One day, I was at my home in Florida and thought, ‘Why the hell am I staying in New York?’” Mr. Icahn, 83 years old, said in a telephone interview.

Mr. Icahn, whose philanthropic stamp on New York includes Icahn Stadium on Randall’s Island and the Icahn School of Medicine at Mount Sinai, said he has lived in New York nearly his entire life and loved it. “But in the last few years, I believe that it is certainly no longer the city of my youth,” he said.

The loss of the super-wealthy isn’t just a matter of reputation. The exodus of billionaires can crimp state budgets.

In 2017, Connecticut’s top 100 filers, out of a base of 1.8 million, paid $1.13 billion in income taxes, the equivalent of 12% of the state’s income-tax revenue for fiscal year 2018.

New Jersey and Connecticut tax officials said it is too early for state revenue data to show whether the 2017 tax law Mr. Trump signed imposing a $10,000 cap on state and local tax deductions has caused high earners to flee. The most recent tax data available is for 2017, and the SALT cap went into effect in 2018.

The SALT cap has widened the gap between Florida and other states with no income tax, such as Wyoming, and New York City, where residents can owe income taxes at rates that approach 13%. Previously, individuals would pay a top rate of 39.6% in federal income taxes, plus state and local income taxes, but those taxes were typically deductible for the highest earners. Now, the state and local rates come atop the highest federal rate of 37%.

Connecticut, with a struggling economy, and New York have been shedding residents. Connecticut’s population of 3.57 million in 2018 represents a decline of 22,000 since its last peak in 2013, according to Census figures. New York’s population dipped to 19.54 million in 2018, marking a drop of about 119,000 from its last peak in 2015. New Jersey’s population has been rising.

Those who have made the move to Florida in recent years cite reasons including anticipation of the 2017 tax law change; the high costs in New York compared with the greater purchasing power of a dollar in their adopted home; and warmer weather in Florida, where many of the transplants already owned vacation homes.

“I moved to Florida because of my age and my arthritis,” said billionaire investor Leon Cooperman, of his decision years ago to relocate from New Jersey to Boca Raton, Fla.

Mr. Cooperman, 76 years old, said he saves more than two hours of commuting time daily because he works out of his home office in Florida, instead of commuting from New Jersey to Manhattan.

The billionaire hedge-fund manager Mr. Tepper moved to Florida in 2016 and relocated his firm’s headquarters there, sparking concern among New Jersey lawmakers about the impact on state revenue.

Most of his investment staff continues to work in Short Hills, N.J. They remain visually connected to the owner of the Carolina Panthers pro football team through an iPad system, said people familiar with the arrangement.

Others who have switched their domiciles to Florida include Mr. Sternlicht, whose Starwood Capital Group changed its headquarters from Greenwich, Conn., to Miami in 2016, and John Phelan, the cofounder of Michael Dell’s family office MSD Capital, which opened an office in West Palm Beach in 2016.

At least one financier has decided that New York is still worth embracing. John Paulson, who made billions betting against the U.S. housing market before the financial crisis, said last year he was thinking of moving to Puerto Rico after his children, both teenagers, finish high school. His spokeswoman said last week he was no longer considering moving out of New York.

>>> US Gapping down

Gapping down
In reaction to disappointing earnings/guidance:

  • CRR -31.4%

Select China related names showing weakness:

  • BZUN -1.4%, JD -1.2%, WB -1.2%, SINA -1%, BIDU -0.9%, CAT -0.8%

Select metals/mining stocks trading lower:

  • RIO -3.4%, BBL -2.8%, BHP -2.2%, CLF -1.7%, X -1%

Other news:

  • NXTC -58.3% (reports clinical data from NC318 Phase 1/2 Clinical Trial)
  • ASLN -18.3% (announces topline results from treetopp global pivotal study of varlitinib in biliary tract cancer; study did not meet its co-primary endpoints)
  • FOMX -16.8% (Foamix and Menlo Therapeutics (MNLO) to merge; Foamix stock will be exchanged for 0.5924 of a share of Menlo common stock and a contingent stock right)
  • TUP -9.5% (suspends quarterly dividend)
  • ARGX -5.5% (entered into $20 mln common stock sales agreement with H.C. Wainwright)
  • FTSI -4.6% (files for ~76.4 mln share common stock offering by holders)
  • MUX -3% (files for 300K share common stock offering by holders)
  • MYOK -1.7% (announced topline data from MAVERICK-HCM, the company's Phase 2 clinical trial of mavacamten in patients with non-obstructive hypertrophic cardiomyopathy) .

Analyst comments:

  • SMAR -6.9% (downgraded to Neutral from Outperform at Wedbush)
  • GDOT -5.6% (downgraded to Neutral from Buy at Guggenheim)
  • LITE -3.8% (downgraded to Equal-Weight from Overweight at Morgan Stanley)
  • ACRX -3.6% (downgraded to Neutral from Outperform at Credit Suisse)
  • RLGY -2.9% (downgraded to Negative from Neutral at Susquehanna)
  • QCOM -1.6% (downgraded to Equal-Weight from Overweight at Morgan Stanley)
  • CSCO -1.3% (downgraded to Neutral from Overweight at Piper Jaffray)
  • HD -1% (downgraded to Hold from Buy at Edward Jones)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance:

  • QRTEA +6.4%, FOLD +4%

Other news:

  • NKTR +7.8% (presents data from first-in-human Phase 1a study on novel t regulatory cell stimulator; was safe and well tolerated in this first-in-human study consistent with prior reported results)
  • SPWR +5.7% (plans to separate into two independent, complementary, strategically-aligned and publicly-traded companies -- SunPower and Maxeon Solar Technologies)
  • OCUL +3.9% (announces operational restructuring plan and strategic update)
  • AL +1.9% (initiates portfolio sale of 19 aircraft to Thunderbolt III Aircraft Lease Limited)
  • AKBA +1.7% (reports 52-week efficacy and safety data for Vadadustat; each study met its primary endpoint)
  • GWPH +0.5% (receives positive NICE recommendation for Epidyolex oral solution for the treatment of seizures in patients with two rare, severe forms of childhood-onset epilepsy)

Analyst comments:

  • MR +1.6% (upgraded to Outperform at Imperial Capital)
  • ROST +0.9% (initiated with an Outperform at RBC Capital Mkts)
  • HPE +0.7% (upgraded to Neutral from Sell at UBS)
  • TEX +0.6% (upgraded to Outperform from Neutral at Robert W. Baird)