Facebook, Twitter and Google are so biased toward the Dems it is ridiculous! Twitter, in fact, has made it much more difficult for people to join @realDonaldTrump. They have removed many names & greatly slowed the level and speed of increase. They have acknowledged-done NOTHING!
I hope the people over at the Fed will read today’s Wall Street Journal Editorial before they make yet another mistake. Also, don’t let the market become any more illiquid than it already is. Stop with the 50 B’s. Feel the market, don’t just go by meaningless numbers. Good luck!
EU Competition Commissioner Vestager: Have concerns about very high speed trains related to Siemens Alstom merger; Important to get Siemens/Alstom market response
- EU takes an interest in Facebook email leaks
- Alitalia investigation still ongoing
SoftBank: Unpacking the massive Masa Son discount
One thing to start: CVC is set to re-enter professional sport with a £225m deal to acquire a minority stake in the parent company behind elite English rugby, providing a crucial capital injection to the cash-starved clubs of the game. Now back to the show . . .
Coming into this year, one major problem was nagging at Masayoshi Son, SoftBank founder and chairman, and his inner circle.
And no, it wasn’t his company’s cosy dependence on the man grinning on the right below. That issue came into focus later on. More on that in a bit.
Instead, SoftBank was frustrated with the enormous discount between the value of its holdings and the value of its shares. To start the year, senior lieutenants inside the company were dispatched around the world to explain the tech-to-telecoms conglomerate better to investors, analysts and others.
To put the discount into perspective, consider that SoftBank’s 28 per cent stake in China’s Alibaba, the ecommerce giant, is worth about $105bn before any tax paid on a hypothetical sale. Compare that with the company’s total equity market capitalisation of roughly $85bn.
You can understand the annoyance that must cause when the company’s holdings also include Arm, the UK chip designer for which it paid $32bn; a wholly owned mobile phone subsidiary in Japan; a majority stake in Sprint in the US; and a sundry of other assets. And that’s all before considering SoftBank is the manager of a near-$100bn investment fund for which it is entitled to management fees and carry.
To address the problem, SoftBank spent much of the year preparing a listing of its Japanese mobile phone unit. That’s set to take place this week, with the company expected to raise $23.5bn from the sale of just over a third of its stake.
To mark the listing, Lex has taken the opportunity to do a deep-dive analysis into SoftBank’s share price discount.
All told, Lex’s Jonathan Guthrie and Sujeet Indap valued SoftBank’s investments at a total of $235bn. That’s a 60 per cent discount to the its market value. One argument is that much of the difference is accounted for by SoftBank’s big debt obligations. Unfortunately, while debts would stay the same in any market rout, the value of SoftBank’s investments would tumble.
You can read the full piece and all of Lex’s analysis here. We’d like to think it’s a nice complement to the comprehensive coverage of SoftBank by the FT throughout the year.
As for the issues with Vision Fund II, we’ve already flagged up that the project is in trouble in the aftermath of the murder of journalist Jamal Khashoggi by agents allegedly from Saudi Arabia.
Last week, we reported that Masayoshi Son confronted Crown Prince Mohammed bin Salman in Riyadh during the “Davos in the Desert” conference, telling him that the Khashoggi crisis had put him in a difficult position, people briefed on the meeting said. The headstrong prince apologised.
Credit Suisse advises clients to consider moving assets out of UK
Lack of clarity around Brexit prompts call by private bankers to top clients
Private bankers at Credit Suisse have advised clients to consider moving assets out of the UK because of a lack of clarity around Brexit.
After Prime Minister Theresa May last week delayed a vote on her deal to leave the EU, wealth managers in London contacted their top customers to warn that a prolonged period of “turmoil” had already caused a rush of clients wanting to “move assets offshore”.
Ultra-wealthy clients were advised that they might want to “accelerate” similar plans before the rescheduled vote in parliament in early January, according to people familiar with the matter.
A Credit Suisse spokesman declined to comment.
The pitch by the private bankers follows a trend of London’s super-rich shunning UK-based assets and diversifying their portfolios outside of the country, particularly using offshore centres, amid fears of both a no-deal Brexit and the possibility of the leftwing Labour party being elected if Mrs May’s Conservative government falls.
Multimillionaires are setting up investment accounts in places such as the Channel Islands and Switzerland, or are shifting the location of UK-registered trusts holding their wealth to outside the country, the Financial Times reported in October. Some are even preparing to emigrate rather than risk becoming subject to a “wealth tax” that Labour leader Jeremy Corbyn has floated in a previous manifesto.
Other wealth managers the FT spoke to said that while they had also noted a marked uptick in concern about the political climate, it was unusual to write to clients explicitly suggesting they move their assets out of the UK.
“We certainly wouldn’t encourage clients to get their money out and run,” said one banker, who asked not to be identified speaking about a competitor. “Our role as wealth advisers is to calm some of the hysteria going on rather than add to it.”
The sell-off in sterling-denominated assets has accelerated since parliament shelved its Brexit vote last Monday, sparking a sharp drop in the pound and extending the decline for UK stocks this year to 7 per cent, compared with an average of 3 per cent around the world.
More evidence is seen in the housing market, where properties in London’s most exclusive neighbourhoods are being offered at their steepest discounts since 2009 as wealthy foreign buyers avoid the market.
Asian stocks slid on Tuesday as President Xi Jinping offered no fresh commitments to open or stimulate China’s economy in a keynote speech, to the disappointment of some observers.
After another sell-off in U.S. shares that sent the S&P 500 Index to its lowest close in 14 months, Asian equities and U.S. futures put in a mixed performance in the morning, with some markets in the green. The MSCI Asia Pacific then slumped as Xi’s address at a Beijing gathering to mark 40 years of Chinese reforms made no mention of new initiatives. That contrasted with recent news about moves to reduce car tariffs, boost U.S. soybean imports and the consideration of tax cuts. Stock benchmarks fell from Sydney to Shanghai. Oil slid to $49 a barrel in New York, and the yen advanced. Treasuries edged up.
US After Hours ORCL +5% following earnings/guidance, JNJ +1.2% rebounding on reaffirmed guidance/buyback news
Nikkei -1.82% Hang Seng -1.05% CSI -1.01% Shanghai -0.78% Shenzen -0.74%
Eur$ 1.1340 CNH 6.8965 CNY 6.8996 JPY 112.62 GBP 1.2621 CHF 0.9935 RUB 66.8335 TRY 5.3787 WTI$ 49.02 -1.72%
S&P +0.10% EuroStoxx -0.49% Dax -0.57% FTSE -0.85% SMI -0.87%
Macro :
- Hedge Fund Shakeout Is ‘Far From Over,’ IDW’s Weinstein Says
- May Says Brexit Talks Will Go Into 2019 as She Fights for Deal
- Oil Closes Below $50 for First Time in a Year as Glut Fears Grow
Keep an eye on :
- AIR FP : Airbus Ready to Pay Special Bonus to Lowest-Paid Workers: Rtrs
- ALO FP : Siemens, Alstom offer to sell high-speed train technology: sources https://t.co/rcHJjBwZ8J https
- AVTX NA : BASF to Exit Synvina JV With Avantium as of Jan. 15
- BAS GY : BASF to Exit Synvina JV With Avantium as of Jan. 15
- BA US : Boeing Boosts Share Buyback to $20B, Boosts Quarter Dividend
- CEREN FP : Cerenis Therapeutics Says Target Study Met Primary Goal
- CHERB SS : EE Intressenter Offers SEK87 for Each Cherry Share
- CORE GY : Coreo Offering Prices 6.59m Shares at EU1.60/Share
- CSGN SW : Credit Suisse Advises Clients to Move Assets Out of U.K.: FT
- DBK GY : Deutsche Bank, Commerzbank Are Said to Test Frankfurt Swaps Move
- DTE GY : T-Mobile, Sprint Win CFIUS Approval for Merger: WSJ
- EDP PL : EDP Decides to Pay Portugal’s CESE Energy Tax, Expresso Reports
- FGR FP : Eiffage Buys 5.03% of Getlink, Says Intends to Be L/T Investor
- ENGI FP : Glow: Multiple Expressions of Interest in Engie’s Stake
- FGA FP : Figeac Aero Confirms Short and Mid Term Targets
- FCT IM : Salini, Fincantieri, Italferr to Build Genoa Bridge: Repubblica
- FORTUM FH : Fortum Starts 2019-2021 Incentive Plan
- GALP PL : Galp Declines to Comment on Any Impact of Strike at Refineries
- GAM SW : GAM Board Aware of Interim CEO’s Background in Merill: FT
- GET FP : Eiffage Buys 5.03% of Getlink, Says Intends to Be L/T Investor
- GLEN LN : Glencore Lifts Stake in Australian Coal Mines W/ Mitsubishi Deal
- IDIA SW : Idorsia’s P2Y12 Phase 2 Clinical Studies Meet Objectives
- JE/ LN : Just Eat Shareholder Bestinver Opposes Call to Sell iFood
- NDA SS : Nordea Says It Has Been Misused for Money Laundering in Past: JP
- NDX1 GY : Nordex Gets 83MW Follow-Up Order For Vientos Neuquinos Wind Farm
- PAH3 GY : Wolfgang Porsche Doesn’t See Porsche IPO as A Topic Now: FAZ
- RNO FP : Nissan’s Saikawa Said to Travel to Europe for Alliance Meeting
- RNO FP : Documents on Ghosn’s Pay Listed ‘Fixed Remuneration’: Yomiuri
- RIB GY : RIB Software Increases Buyback Program by Up to 2M Shares
- RIO LN : Rio Tinto could partner with private equity to pursue large copper producers , Anglo American , First Quantum, and Freeport as potential targets, the paper said.
- RIO LN : Rio Could Boost Returns On Exit From Grasberg, Macquarie Says
- ROCKB DC : Rockwool’s Russian Business Is Doing Well, CEO Tells Borsen
- SFL IM : Safilo Says 80.7% of Offering Was Subscribed
- SHB LN : Norges Bank Raises Stake in Shaftesbury to 24.5%: Telegraph
- SON PL : Sonae MC Agrees Sale-Leaseback of Continente Store for EU27.8M
- TIT IM : Elliott Could Weigh Raising Stake in Telecom Italia: MF
- TIT IM : *DI MAIO: GOVT NOT ASKING CDP TO RAISE TEL. ITALIA STAKE: ANSA
- THULE SS : Thule Buys Tepui Outdoors for $9.5m on Cash/Debt-Free Basis
- UMI BB : Umicore Expands Production Capacity for Fuel Cell Catalysts
- UNI SM : Unicaja, Liberbank Mull Selling Stakes in Caser: Expansion
- VLTSA FP : Voltalia Reaffirms Confidence in Ability to Reach ’20 Targets
- VOW3 GY : About 185,000 VW Customers Sign Up in German Case Over Diesel
- VOW3 GY : Wolfgang Porsche Says VW Key Stakeholders Back Ford Plans: FAZ
>>> Up
* ABN Amro GDRs Upgraded to Top Pick at RBC; Price Target 30 Euros
* Cineworld Upgraded to Top Pick at RBC; Price Target 3.50 Pounds
* CompuGroup Raised to Buy at Baader Helvea; Price Target 49 Euros
* Eiffage Upgraded to Hold at Kepler Cheuvreux; PT 91 Euros
* JCDecaux Raised to Equal-weight at Morgan Stanley; PT 24 Euros
* Remy Cointreau Raised to Market Perform at Bernstein
* Technotrans Upgraded to Buy at HSBC; PT 34 Euros
* Zalando Upgraded to Buy at DZ Bank; PT 28 Euros
>>> Down
* Asos Downgraded to Hold at Santander; PT 40.79 Pounds
* Coface Downgraded to Hold at Kepler Cheuvreux; PT 7.50 Euros
* Nemetschek Downgraded to Reduce at Kepler Cheuvreux; PT 85 Euros
* Pfeiffer Vacuum Downgraded to Hold at HSBC; PT 127 Euros
* Worldpay Downgraded to Outperform at RBC; PT $107
>>> Initiation
* BioInvent International Rated New Buy at Pareto Securities
* Cewe Stiftung Rated New Buy at Kepler Cheuvreux; PT 94 Euros
* Colonial Rated New Neutral at Citi
* IG Group Rated New Buy at Peel Hunt; PT 7.75 Pounds
* Logitech Rated New Outperform at Wedbush; PT 40 Francs
* Merlin Rated New Neutral at Citi
* M1 Kliniken Rated New Buy at Commerzbank; PT 19 Euros
* Plus500 Rated New Hold at Peel Hunt; PT 15 Pounds
* SGL Rated New Hold at Deutsche Bank; PT 7 Euros
* Zooplus Rated New Underperform at MainFirst; PT 114 Euros
>>> Call
After Hours Summary: ORCL +5% following earnings/guidance, JNJ +1.2% rebounding on reaffirmed guidance/buyback newsAfter Hours Gainers:
Companies trading higher in after hours in reaction to earnings/guidance: ORCL +5%, JNJ +1.2% (announces $5 bln share repurchase plan, reaffirms full year guidance)
Companies trading higher in after hours in reaction to news: PBYI +10.9% (announces top line results of the Phase III NALA Trial of Neratinib in patients with HER2-positive metastatic breast cancer; hit PFS primary endpoint, misses OS endpoint), SGH +5.9% (to join S&P SmallCap 600), BA +1.9% (raises dividend 20%, increases share repurchase authorization to $20 billion), TLRY +1.6% (following 14% move lower on LOI news to purchase hemp-derived CBD isolate from LiveWell Canada), XRX +1% (after closing ~13% lower on the day following Moody's downgrade of senior unsecured debt ratings), OKTA +0.9% (ticking higher following Cramer mention), CBS +0.9% (completed its investigation of former Chairman and CEO Leslie Moonves, CBS News, and cultural issues at CBS; determined that there are grounds to terminate Leslie Moonves for cause), ABX +0.4% (raises quarterly dividend to $0.07/share from $0.03/share)
After Hours Losers:
Companies trading lower in after hours in reaction to news: OPRX -2.5% (proposed underwritten public offering by WPP Luxembourg Gamma Three of 2,103,702 shares of common stock), EHTH -1.9% (ticking lower; files for $150 mln mixed securities shelf offering), UXIN -1.2% (after stock continues to rally -- month-to-date is higher by more than 150%)