Sent from Bloomberg Professional for Android
Sent from Bloomberg Professional for Android
Sent from Bloomberg Professional for Android
Sent from Bloomberg Professional for Android
Bridgewater Associates (Raymond Dalio) discloses updated portfolio positions in 13F filing: New ENDP CNX FXI positions
Highlights from 2019 Q2 filing as compared to Q1 2019:
- New positions in: ENDP (~3.15 mln shares), CNX (~1.81 mln), FXI (~0.72 mln), MCHI (~0.5 mln), CNP (~0.43 mln), SLB (~0.41 mln), BK (~0.38 mln), QRTEA (~0.32 mln), DISCA (~0.31 mln), BWA (~0.29 mln)
- Increased positions in: SWN (to ~15.52 mln shares from ~3.18 mln shares), MRO (to ~0.79 mln from ~0.15 mln), BBBY (to ~3.66 mln from ~1.55 mln), KR (to ~1.81 mln from ~0.05 mln), NLY (to ~1.18 mln from ~0.34 mln), CCL (to ~1.02 mln from ~0.21 mln), RLGY (to ~2.54 mln from ~1.79 mln) IPG (to ~1.49 mln from ~0.79 mln), XEC (to ~0.76 mln from ~0.1 mln), CMCSA (to ~0.7 mln from ~0.15 mln)
- Maintained positions in: IAU (~11.68 mln shares), EWZ (~9.43 mln shares), GLD (~4.06 mln shares), VEA (~4.05 mln shares), LQD (~2.63 mln shares)
- Closed positions in: BMY (from ~0.99 mln shares), MOS (from ~0.79 mln), RF (from ~0.74 mln), KEY (from ~0.54 mln), DISH (from ~0.51 mln), AN (from ~0.44 mln), HBAN (from ~0.28 mln), BAC (from ~0.15 mln), BBT (from ~0.14 mln)
- Decreased positions in: T (to ~0.1 mln shares from ~0.87 mln shares), AMTD (to ~0.22 mln from ~0.57 mln), DVA (to ~0.11 mln from ~0.43 mln), EMN (to ~0.3 mln from ~0.6 mln), WU (to ~0.39 mln from ~0.66 mln), MNST (to ~0.31 mln from ~0.55 mln), URI (to ~0.16 mln from ~0.38 mln), EWY (to ~3.57 mln from ~3.77 mln), CVS (to ~0.45 mln from ~0.64 mln), TXT (to ~0.14 mln from ~0.33 mln)
Baupost Group (Seth Klarman) discloses updated portfolio positions in 13F filing: New XPO positions, exited CELG
Highlights from 2019 Q2 filing as compared to Q1 2019:
- New positions in: XPO (~1.5 mln shares)
- Increased positions in: BMY (to ~13 mln shares from ~4 mln shares), LBTYK (to ~41.94 mln from ~39.09 mln), LBTYA (to ~7.44 mln from ~4.96 mln), TBIO (to ~8.84 mln from ~6.49 mln), CBS (to ~10 mln from ~8.54 mln) ATRA (to ~7 mln from ~6.38 mln), TMQ (to ~13.64 mln from ~13.05 mln) NXST (to ~1.4 mln from ~1 mln),
- Maintained positions in: CLNY (~49.69 mln shares), AR (~28.59 mln shares), FOXA (~27.32 mln shares), PCG (~24.5 mln shares), AKBA (~24.47 mln shares), VSAT (~13.73 mln shares), UNVR (~9.5 mln shares), TBPH (~9.31 mln shares), FOX (~5.68 mln shares),
- Closed positions in: CELG (from ~4 mln shares), PXD (from ~2 mln), DIS (from ~0.4 mln)
- Decreased positions in: EBAY (to ~24.15 mln shares from ~29.29 mln shares), SYF (to ~9.26 mln from ~14.26 mln), SBGI (to ~0.55 mln from ~2.91 mln), LNG (to ~10.67 mln from ~12.62 mln), QRVO (to ~8.68 mln from ~10.59 mln), TAK (to ~9.44 mln from ~10.67 mln), AGN (to ~3.68 mln from ~4.77 mln), MCK (to ~2.6 mln from ~2.82 mln), ABC (to ~2.21 mln from ~2.4 mln)
After Hours Summary: REAL +12%, GO +11%, MYGN -16.5%, ADPT -10.2%, CDK -9%, TLRY -8.5% among notable earnings/guidance moversAfter Hours Gainers:
Companies trading higher in after hours in reaction to earnings/guidance: REAL +11.7%, GO +11%, CHNG +10.2%
Companies trading higher in after hours in reaction to news: OCN +2.6% (Pres/CEO, Chief Growth Officer, and two Directors disclosed insider purchases), DCPH +1.6% (continued strength; also commences public offering of $200 mln in shares of common stock), CTRA +1.3% (announces board and leadership changes; appoints Jason Whitehead as Chief Operating Officer)
After Hours Losers:
Companies trading lower in after hours in reaction to earnings/guidance: CPLG -18.5%, MYGN -16.5%, ADPT -10.2%, CDK -8.9%, TLRY -8.5%, PSNL -5.6%
Companies trading lower in after hours in reaction to news: G -4.9% (light volume; announces secondary public offering of 12.5 mln common shares by selling stockholders), RKDA -3.9% (extending today's 12% move lower), IVR -2.5% (plans to make a public offering of 14 million shares of its common stock), W -2% (announces intention to offer $750 mln in convertible senior notes due 2026)
Tilray (TLRY) earnings/guidance is weighing on a few cannabis names: CGC -1.8% (also ACRGF reported earnings), APHA -1.7%, ACB -1.1%
Closing Stock Market SummaryU.S. stocks rallied on Tuesday after the White House announced that it will delay the 10% tariff rate for some items imported from China, including cell phones and laptops, until Dec. 15. Apple (AAPL 208.97, +8.49, +4.2%) led the broad-based advance and contributed to the solid gains in the S&P 500 (+1.5%), Dow Jones Industrial Average (+1.5%), and Nasdaq Composite (+2.0%). The Russell 2000 increased 1.1%.
Originally, the 10% tariff rate on $300 billion of mostly consumer goods was set to go into effect Sept. 1. Most products will still be taxed on that date, but the decision to delay some big-ticket items followed a "public comment and hearing process," according to the USTR. Other items will be also removed from the tariff list based on "health, safety, and national security" factors.
President Trump told reporters he wanted to delay the tariffs so consumers would not be hurt during the Christmas shopping season and said he had a very productive call with China. On a related note, China's Ministry of Commerce indicated that trade talks will resume over the phone within the next two weeks.
In turn, the upbeat news contributed to gains in all 11 S&P 500 sectors and a 4% rally in oil prices ($57.04/bbl, +$2.23, +4.1%). Nine sectors advanced at least 1.0%, led by the information technology (+2.5%), consumer discretionary (+1.7%), and communication services (+1.5%) sectors. The Philadelphia Semiconductor Index climbed 3.0%.
Although structural trade issues remain, the news did serve as a temporary relief to the market that had been grappling with geopolitical uncertainty, growth concerns, weakness in global equities, and declining U.S. Treasury yields.
For instance, prior to the tariff news, attention remained heavily centered on the Hong Kong protests that continued to escalate. Riot police confronted protesters at the city's airport after flights were canceled for the second consecutive day on Tuesday.
Shorter-dated U.S. Treasuries sold off, driving yields higher in another curve-flattening trade. The 2-yr yield increased nine basis points to 1.67%, and the 10-yr yield increased four basis points to 1.68%. The general risk-on mood helped the market overlook the continued compression in yields. The U.S. Dollar Index advanced 0.5% to 97.82.
Reviewing Tuesday's economic data, which included the Consumer Price Index for July and the NFIB Small Business Optimism Index for July:
- Total CPI increased 0.3% m/m in July, as expected, while core CPI, which excludes food and energy, also increased 0.3% (consensus 0.2%) for the second straight month. Those readings left total CPI up 1.8% yr/yr, versus 1.6% in June, and core CPI up 2.2% yr/yr, versus 2.1% in June.
- The key takeaway from the report is that it muddles the monetary policy outlook. The year-over-year readings are not exactly "rate-cutting" material, but with everything else going on, the market will be left to conclude that another rate cut is likely since the Fed will want to ensure that everything else going on doesn't lead to a caustic slide in inflation expectations.
- The NFIB Small Business Optimism Index for July increased to 104.7 from 103.3 in June.
Looking ahead, investors will receive the weekly MBA Mortgage Applications Index, and Export and Import Prices for July on Wednesday.
- Nasdaq Composite +20.8% YTD
- S&P 500 +16.7% YTD
- Dow Jones Industrial Average +12.6% YTD
- Russell 2000 +12.0% YTD
Aston Martin: driving a hard bargain
If another cash outflow occurs, market doubts about its future will strengthen
Convertible top down. Hair blowing in the wind. Pedal to the metal. That scenario applies both to a Sunday drive and the vertiginous ending of the 1991 movie Thelma & Louise. The career of an Aston Martin Lagonda is beginning to resemble the latter. Shares fell more than 3 per cent on Tuesday after the Financial Times reported rising short positions. They have lost three-quarters of their value since October’s stock market flotation.
As faith in the UK luxury carmaker’s growth plan dwindles, attention is focusing on its financial solidity. Aston Martin’s capital expenditure is expected to exceed £300m annually for the next few years. Net debt at June was already three times forward ebitda. Rising bond shorts anticipate growing strains.
Last month Moody’s noted an unexpected half-year cash outflow of more than £17m due to rising inventories in preparation for higher sales in the second half. The rating agency downgraded the junk bonds of the group one notch. If another cash outflow occurs in the second half, the market’s doubts about Aston Martin’s future will harden.
At the current pace of cash burn, the luxury carmaker ostensibly has enough to last well into 2021. By then its big hope, a new sport utility vehicle called the DBX, will have launched. This £150,000 SUV is expected around April next year. Supply chain problems following a no-deal Brexit could spoil that. A bottleneck late last year forced Aston Martin to draw down its bank credit line. That has not all been paid back. Indeed, by June it was almost fully used up, highlighting cash flow pressures.
The question is whether the market can expect good news on sales. Unless the global economy improves, perhaps not. How might Aston Martin then raise cash? Debt is one option. But its sterling bonds already yield 8.6 per cent, more than 460 basis points above other European corporate high-yield bonds. Its two big shareholders, the Italian private equity firm Investindustrial and a group of Kuwaiti holders, have about 61 per cent of the company. But the Kuwaitis have been selling down. They are unlikely to put up fresh equity.
With its shares down more than half this year, even a £100m rights issue would represent just a 10th of Aston Martin’s market value. Aston Martin still has gas in its tank and a highway ahead. But its options, like the heroines of Thelma & Louise, are increasingly narrow.
Beny Steinmetz denies Swiss bribery charges over mining deal
Prosecutor accuses tycoon of ‘bribing foreign officials and forgery’ in Guinea between 2005-10
Israeli diamond tycoon Beny Steinmetz has denied charges made by Swiss prosecutors that he bribed Guinean officials to win lucrative mining licences in the west African country.
Mr Steinmetz and two associates are alleged to have paid $10m to one of the wives of Lansana Conté, the former president of Guinea, in order to secure rights to one of the world’s largest untapped reserves of iron ore, partially through Swiss bank accounts. Prosecutors are seeking prison terms of two to 10 years for the three.
The Israeli billionaire has been enmeshed in legal battles around the globe stemming from allegations that his business orchestrated a bribery scheme to win the prized mining prospect, a source of the key ingredient needed to make steel.
In an indictment filed with Geneva’s criminal court, a prosecutor accused Mr Steinmetz of “bribing foreign officials and forgery” in Guinea between 2005-2010 while operating his business from Geneva.
Claudio Mascotto, the Geneva prosecutor, said he had been investigating the case since 2013. The bribery allegations were first revealed in the Financial Times in 2012.
Mr Steinmetz paid “bribes to one of the wives of former Guinean president Lansana Conté with a view to ousting a competitor and granting Beny Steinmetz Group Resources [BSGR] mining rights in the region of Simandou,” the prosecutor’s office said in a statement.
The bribes were hidden using forged documents and “false invoices”, according to the indictment.
Marc Bonnant, Mr Steinmetz’s Geneva-based lawyer, said the charges were baseless.
“Beny Steinmetz denies categorically any wrongdoings,” he told the FT. “He never paid a single cent to any president in Guinea or to any public agent in Guinea, neither did he ever give instructions for such monies to be paid.”
Mr Steinmetz now lives in Israel, but returned to be questioned by prosecutors and attended every hearing over the past six years, Mr Bonnant said. The billionaire will attend the trial, he added.
Mr Steinmetz has long denied wrongdoing in his dealings in Guinea, which have been the subject of a series of corruption probes in Guinea, the US, Switzerland and Israel, where he was detained and questioned by police in 2016.
Earlier this year, Mr Steinmetz reached a settlement with Guinean authorities over the rights to portions of the giant Simandou project in which both parties agreed to “waive all outstanding procedures”.
The Guinean government also granted another mining license to a group in which Mr Steinmetz is an investor.
“Not only do the Guinean authorities recognise today that there has never been corruption, but they give back [another mining license] to the alleged corruptor,” Mr Bonnant said.
The deal in February brought an end to a saga that began in 2008 when Mr Conté stripped Anglo-Australian miner Rio Tinto of its license for the northern half of the deposit. Days before he died later that year, Mr Conté granted the same rights to BSGR, a mining arm of Mr Steinmetz’s business empire.
His successor, Alpha Condé, later launched an inquiry into the deal and concluded the rights had been won through bribery. He cancelled BSGR’s claims on Simandou and Zogota, another large deposit, though the company denied any wrongdoing and fought the decision through international arbitration.
Under the February deal, BSGR relinquished its rights to blocks 1 and 2 of the project, and Guinea asked a group of investors, including Mr Steinmetz and former Xstrata boss Mick Davis, to develop Zogota.
BSGR said: “The indictment announced by the Swiss prosecutor’s office is as misjudged as it is absurd in view of the dropping of all claims against BSG Resources and Beny Steinmetz by the Guinean government.”
Last year BSGR was placed into administration in the face of the legal battles swirling around its dispute with Guinea.
BSGR was ordered to pay iron ore producer Vale $1.25bn after it was found liable for fraudulent misrepresentations, including a bribery scheme, by a London arbitration court.
Details of the award, made in April, emerged in the US where Vale is seeking a court order to enforce the decision, which relates to an ill-fated joint venture in Guinea.