US trade deficit at widest level in 10 years
Data shows fall in exports to China
The US trade deficit hit its widest level in a decade in October as the nation registered a record amount of imports and a decline in exports to China.
The Department of Commerce said Thursday the gap between US imports and exports grew 1.7 per cent month-over-month to $55.5bn, the most since October 2008 and the fifth straight month of deficit expansion. Economists polled by Thomson Reuters anticipated a smaller deficit of $55bn.
For September, the US trade deficit was revised to $54.6bn from $54bn.
America’s goods trade deficit with China, which has come under a microscope amid a trade spat between the world’s two largest economies, jumped 7.1 per cent to $43.1bn.
In a back-and-forth exchange of new tariffs, the US has levied import duties on $250bn of Chinese goods in a bid by President Donald Trump to convince Beijing to make economic reforms. Mr Trump has also deployed tariffs on foreign steel and aluminium. China has retaliated with tariffs on politically sensitive goods such as soyabeans, vehicles and orange juice.
Mr Trump and Chinese president Xi Jinping reached a 90-day truce last weekend that called for the two sides to restart negotiations. Under the deal, the US will hold off on carrying out a threat to impose additional tariffs, and China agreed to reduce tariffs and other trade barriers.
US soyabean exports fell by $0.8bn in October, while exports of civilian aircraft and foods, feeds and beverages also declined. Industrial supplies and materials exports rose $0.3bn. Exports of services were up $0.1bn, driven by financial and other business services.
Vehicles, pharmaceutical preparations and travel services lifted imports by 0.2 per cent to $266.5bn, the highest on record.
Adjusted for inflation, the October trade deficit was $87.9bn, up from $87.2bn in the prior month.
Free refuse de jouer un rôle dans le retour à trois opérateurs - http://bit.ly/2SzJHK7
Free n’est pas à vendre et ne cherche à racheter l’un de ses concurrents. Thomas Reynaud, Directeur Général d’Iliad, a fait savoir qu’il ne se sentait pas particulièrement concerné par une consolidation d secteur des télécoms. Tout comme Orange. Pour voir un retour à trois opérateurs, ce sont donc SFR et Bouygues Telecom qui devront bouger.
Free n’est ni acheteur ni vendeur. Thomas Reynaud, Directeur Général d’Iliad, maison-mère de Free, a assuré au micro d’Europe 1 que Free ne sera pas « le déclencheur » d’une éventuelle consolidation du secteur des télécoms en France. Il se dit confiant dans l’avenir avec le lancement de la Freebox Delta et affirme que le FAI n’est « vraiment pas du tout focalisé sur cette question de la consolidation ». Il préfère garder un statut d’observateur sur la question. « On a vocation à rester indépendant, on a aujourd’hui un peu plus de 10.000 collaborateurs, on a des très beaux produits, on a encore de très nombreuses surprises, et cette Freebox Delta », estime-t-il.
Comme Orange, Free n’est ni acheteur, ni vendeur
Si pour Orange un retour à 3 opérateurs est inévitable en 2019, de son côté Free se dit être « dans un état d’esprit où le marché peut rester à quatre opérateurs ». Une des raisons principales résidant dans le fait que si tout le monde s’accorde à dire qu’il est dans leur intérêt de repasser à 3 acteurs majeurs, aucun ne semble vraiment prêt à vendre. Et ce ne sont pourtant pas les tentatives de rachat qui ont manqué.
« Il y a eu au cours des cinq dernières années, je crois, sept tentatives de consolidation », explique Thomas Reynaud. « Nos concurrents ont essayé de se racheter les uns les autres », affirme-t-il, sans qu’un accord n’ait jamais pu être conclu. Dernier cas connu en date, la tentative de rachat de SFR par Bouygues Telecom initiée au printemps 2018. Mais Patrick Drahi s’est montré gourmand alors que son opérateur, filiale du groupe d’Altice, retrouve des couleurs en 2018 avec d’excellents chiffres de recrutement.
Quand Orange évoquait un retour à trois opérateurs récemment, il adoptait la même position que Free, à savoir jouer le facilitateur d’un rachat entre d’autres acteurs, mais en ne se positionnant lui-même ni en acheteur ni en vendeur. Il semble donc bien que cela se joue entre SFR et Bouygues Telecom. Reste à savoir qui va avaler qui. Et si cette consolidation dont on entend de plus en plus parler va vraiment avoir lieu dès l’année prochaine.
Eddie Lampert, the billionaire behind Sears, has put forward plans to buy out of bankruptcy “substantially all” the assets of the collapsed department store chain through his hedge fund ESL.
ESL said the bid valued the assets at $4.6bn, of which $1.8bn comprises a so-called credit bid, in which the hedge fund would forgo claims on Sears debt. The retailer filed for Chapter 11 protection in October.
The rest of the bid would be funded from other sources including cash and new lending facilities, for which ESL has yet to secure backing.
Sears has until December 15 to name a stalking horse bidder for its assets. Its plan will ultimately be subject to approval from a bankruptcy court.
ESL is being advised by Moelis. ESL said: “We believe that our strategy will enable Sears to prosper in an integrated consumer and retail landscape and view a going concern transaction as essential to providing optimal value to stakeholders.”
Lyft Sets Stage for Early 2019 IPO
Ride-hailing firm likely remains a step ahead of rival Uber on timing
Lyft Inc. has filed confidential paperwork for its initial public offering, a key step that keeps the ride-hailing firm on pace to hit the public market early next year.
Lyft’s IPO is one of the most anticipated Silicon Valley debuts in recent years. Its confidential filing, which was expected, indicates it likely remains a step in front of rival Uber Technologies Inc. timing-wise, as both firms accelerate toward IPOs in 2019.
Lyft is expected to debut in March or April, according to people familiar with the matter. By filing with the SEC now, the company will have time to answer questions from the agency in the coming months and stick to that potential time frame.
Lyft, the much smaller of the two ride-hailing companies, is widely expected to beat Uber to the public markets, and in doing so would be the first company to allow public investors to buy into its fast-growing industry.
The IPO will be a test of how public investors will value these types of companies. Uber, Lyft and a host of other ride-hailing firms have received vast amounts of money from private investors at high valuations but still need lots of additional capital as they generate big losses.
In October, the Journal reported that Lyft had picked its underwriters for the offering. The firm’s valuation is expected to top the $15.1 billion it was valued at earlier this year.
Meanwhile, Uber, has received proposals from bankers that value it as high as $120 billion, the Journal reported in October. Companies often consider such proposals before hiring IPO underwriters.
Uber Chief Executive Dara Khosrowshahi has said the company would aim to go public in the second half of 2019. But the IPO could come sooner, as Uber looks to tap a robust market for public offerings.
Lyft makes money by taking a commission on rides booked through its app. It posted third-quarter revenue of $563 million, up 88% compared with the year-earlier period, the Journal has reported. It lost $254 million in the quarter.
In November, Uber said its third-quarter revenue rose 38% to $2.95 billion, and it posted a loss of $1.07 billion.
Uber has weathered a series of scandals, including claims of workplace sexual harassment and the alleged theft of trade secrets from rival Alphabet Inc. Mr. Khosrowshahi has sought to win back investors, drivers and riders amid growing competition.
El Paso Electric halts sale consideration, sources say
06 DEC 2018
El Paso Electric’s [NYSE:EE] board of directors has elected to not proceed with a formal sale process, said four sources familiar with the matter.
The decision to hold off a sale of the regional Southwest utility came within the last few weeks after the company’s financial advisor Lazard canvassed a select group of potential buyers, these sources said.
After receiving soft interest, El Paso’s board opted to continue as a standalone business at this point, the sources said. It remains possible the board could change its mind and consider a sale again in the future.
El Paso received an in-bound approach from a strategic suitor earlier this year that led to the company soliciting the advice of an investment bank, as reported by this news service.
Several factors provided headwinds for a sale of the west Texas utility. El Paso has a highly-levered balance sheet, a disparate and politically-strained territory located along the border of the US and Mexico and a challenging regulatory environment, as reported.
Sister publication SparkSpread reported in May that El Paso received an unsolicited approach from an undisclosed company about a deal and that a formal review would likely come after Labor Day. This news service reported in early October that Lazard was contacting a small group of potential suitors.
El Paso Electric has a USD 2.31bn market cap and its shares closed at USD 56.25 on Tuesday compared to a 52-week high of USD 64.35.
The utility services 424,000 retail customers in southeast New Mexico and west Texas. Its 2 gigawatt generation fleet is comprised of about 70% natural gas-powered facilities and 30% nuclear, with 1,848 miles of transmission lines, according to an investors presentation.
El Paso did not return calls for comment.
FED Kaplan (Dov, Non voter): Going to be cautious, patient with policy, we're a little below neutral policy rate
- My view is neutral rate is at the lower end of the 2.5-3.5% range - Seeing high level of uncertainty
- Companies are widely affected by trade tensions
With US Futures down 1.5-2% in the pre-market, most stocks are trading lower. The following represents a list of stocks with identified catalystsGapping down
In reaction to disappointing earnings/guidance:
- MOMO -11.1%, THO -9.4%, PLCE -9.1%, OLLI -6.7%, GWRE -6.4% (issued downside guidance for Q2 and mixed guidance for FY19), MEI -2.8%, HPE -2.7%, HQY -1.9%, GIII -1.8%, MDB -1.5% (guided Q4 revs above consensus)
Other news:
- CNAT -54.4% (reports data from from ENCORE-PH Phase 2b; misses primary endpoint)
- SUPN -41.8% (announces positive topline results from each of two pivotal Phase III studies of SPN-812 in children for the treatment of attention deficit hyperactivity disorder
- NPTN -18% (Huawei uncertainty)
- AVA -14.8% (receive regulatory decision from the Washington Utilities and Transportation Commission denying their proposed merger)
- APHA -12.2% (announces special committee to review governance processes related to LATAM acquisition)
- TDOC -4.7% (issues statement refuting SIRF report claims)
- TTD -4.4% (announced departure of COO Rob Perdue)
- ALV -4% (updates on European Commission's investigation of suppliers of occupant safety systems; believes EC will seek to impose fine in connection with remaining portion of investigation)
- LRCX -2.8% (CEO Martin Anstice resigns amid investigation into alleged workplace misconduct; guidance reaffirmed)
- BIDU -2.7% (priced offering of $250 mln aggregate principal amount of notes)
- ABBV -2% (to stop enrollment for the TAHOE trial following recommendation from Independent Data Monitoring Committee) .
Analyst comments:
- BLUE -3.7% (downgraded to Neutral from Overweight at Piper Jaffray)
- FB -2.8% (downgraded to Hold from Buy at Stifel)
- HQY -1.9% (downgraded to Hold from Buy at SunTrust)
Gapping up
In reaction to strong earnings/guidance:
- LE +6%, MIK +6%, OKTA +4.7%, SGU +3.6%, MRVL +3.2%, CLDR +3.2%, ESTC +2.7% (also issued upside guidance for Q3 and FY19), ZS +2.1% (guided Q2 and FY10 EPS and revs above consensus), FIVE +1.8%, SCWX +1%, KLXE +1%, NWE +0.9% (reaffirmed fiscal 2018 guidance), HOME +0.7%, BF.B +0.6%, .
Other news:
- AXON +6.7% (announces feedback from a face-to-face pre-IND meeting with the FDA regarding AXO-Lenti-PD for patients with Parkinson's disease)
- ADC +1.1% (increased quarterly cash dividend)
- RBC +0.9% (to sell Regal Drive Technologies to an affiliate of Sun Capital Partners)
- MNK +0.5% (to spin-off of specialty generics business)
Analyst comments:
- EPR +4.8% (upgraded to Outperform from Mkt Perform at Raymond James)
